The Maharashtra government has introduced stricter guidelines for the utilization of Member of Legislative Assembly (MLA) Local Area Development (LAD) funds in cooperative housing societies. As per the new government resolution (GR) issued this week, societies must meet specific financial and compliance criteria to be eligible for these funds.
The move aims to ensure transparency, financial discipline, and accountability while allowing cooperative housing societies to undertake infrastructure improvements and sustainability projects using MLA funds.
Stricter Eligibility Criteria for Housing Societies
To qualify for MLA LAD funds, housing societies must now meet the following requirements:
Three Years of Statutory Audits
- The society must have undergone statutory audits for the last three years.
- The society must have received at least a ‘B’ audit grade, which is considered difficult to obtain.
No Major Outstanding Dues
- Over 50% of the society’s members must not have outstanding arrears related to maintenance and common area upkeep.
Compliance with General Body Meetings & Reports
- Societies must have conducted regular general body meetings within the time frame prescribed under the Maharashtra Co-operative Societies Act, 1960, and Rule 1061.
- They must have submitted the minutes of these meetings along with the audit reports to the Registrar of Cooperative Societies.
No Legal Action Under the Cooperative Societies Act
- Societies must not have faced action under Sections 83 and 88 of the Maharashtra Co-operative Societies Act, which relate to mismanagement and misuse of funds.
Permissible Uses of MLA LAD Funds in Housing Societies
The Maharashtra government first approved the use of MLA funds in cooperative housing societies in 2022 to support sustainability initiatives and infrastructure improvements. Permissible projects include:
Water and Energy Conservation Initiatives
- Installation of rainwater harvesting systems
- Setup of solar panels for energy efficiency
Infrastructure and Common Area Development
- Internal road repairs and paver block installation
- Construction of jogging tracks, gymnasiums, and small parks
MLA Fund Allocation Limits for Housing Societies
Under the MLA LAD scheme, the government has set clear financial limits for fund allocation:
- Up to ₹50 lakh can be allocated to a single housing society.
- A total of ₹1.5 crore can be distributed across multiple societies per year by an MLA.
- Societies must contribute 25% of the project cost, while the remaining 75% is covered by MLA funds.
- MLAs cannot allocate funds to the same society for two consecutive years.
Political and Social Impact of MLA LAD Funds in Housing Societies
The MLA LAD fund scheme has had a significant impact on urban housing societies, particularly in Mumbai, Pune, and Thane. Unlike slum areas where election campaigns often involve cash or liquor inducements, politicians in urban areas woo voters in housing societies by funding infrastructure improvements and paying property tax bills.
With the implementation of stricter eligibility norms, the Maharashtra government aims to ensure that MLA LAD funds are used ethically and efficiently, benefiting societies that demonstrate good financial management and transparency.
Conclusion
The new regulations for MLA LAD funds reflect the Maharashtra government’s commitment to accountability and structured development in cooperative housing societies. By enforcing stringent audit and compliance requirements, the government ensures that only financially responsible and well-managed societies receive these funds. The move is expected to enhance the sustainability and quality of urban living while preventing misuse of public money.
