Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City

SIXTEENTH CONGRESS
First Regular Session

874

House Bill No.

Introduced by REP. CESAR V. SARMIENTO

EXPLANATORY NOTE

Cities play a pivotal role in the development of a society. Ancient cities
became the seat of civilization. Commerce, trade, industry and culture started in the
cities. Interestingly, cities are always the precursor to modernization and
industrialization. The socio-economic growth of a place can be gauged as to the
establishment of a city in that particular area. Indeed, it is undeniable that cities are
central to economic and societal progress.

In 1900, only 13 percent of the world's population lived in cities. Two years
ago, more than half of the world’s population lives in urban areas. By 2050, that
number will rise to 70 percent according to studies.

The Philippines, being an archipelago, needs to be economically and socio-
culturally consolidated as a whole and the establishment of at least one city per
province, the capital town that is, will pave the way towards the economic
independence of each province while securing the well being of the whole nation.

Corollary, there is a need to revisit and further amend the provisions of the
Local Government Code of 1991, as amended, to exempt capital towns of the
provinces in the Philippines with the requirements set forth in the law for capital
towns to become cities. Given their roles as the commercial, political, and socio-
cultural centers in their respective provinces, it becomes necessary to further
capacitate these municipalities by elevating their status to component cities. Such
change of status will give them more autonomy and taxation powers and an
increased share in the internal revenue allotment. More importantly, cityhood will
boost investor confidence and invigorate the business and even tourism climate.

Cities are important catalyst of fiscal and societal change. We cannot tarry
behind in the global arena just because we refuse to upgrade our capital towns to
cities. As Samuel Palmisano puts it, “Therefore, it is in our cities, | believe, that we
can see the most promising opportunity for an intelligent upgrade in how the world
works and how we live.”


The proposed bill, in essence, seeks to assist capital towns in considerably
improving the lives and well-being not just of their populace but the rest of the
country. Thus, the passage of this bill is highly called for.

rm FO

CESAR V. SARMIENTO


Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City

‘SIXTEENTH CONGRESS
First Regular Session

House Bill No. G74

Introduced by REP. CESAR V. SARMIENTO

AN ACT AMENDING SECTION 450 OF REPUBLIC ACT 7160 OTHERWISE
KNOWN AS THE LOCAL GOVERNMENT CODE OF 1991, AS AMENDED BY
REPUBLIC ACT NO. 9009, BY EXEMPTING CAPITAL TOWNS OF PROVINCES
WITHOUT CITIES FROM THE INCOME REQUIREMENT SET FORTH THEREIN
AND FOR OTHER PURPOSES

Be it enacted by the Senate and the House of Representatives of the
Philippines in Congress assembled:

Section 1. Section 450 of Republic Act No. 7160, as amended by Republic
Act No. 9009, is hereby further amended to read as follows:

“Section 450. Requisites for Creation. - (a) A municipality or a cluster of
barangays may be converted into a component city if it has an average annual
income, as certified by the Department of Finance, of at least one hundred million
pesos (P100,000,000.00) for the last two (2) consecutive years based on 2000
constant prices, and (b) if it has either of the following requisites:

(i) A contiguous territory of at least one hundred (100) square kilometers,

as certified by the Land Management Bureau; or

(ii) A population of not less than one hundred fifty thousand (150,000)

inhabitants, as certified by the National Statistics Office;


Provided, That, the creation thereof shall not reduce the land area, population,
and income of the original unit or units at the time of said creation to less than the
minimum requirements prescribed herein.

PROVIDED FURTHER, THAT CAPITAL TOWNS OF PROVINCES WHERE
THERE ARE NO EXISTING CITY SHALL BE EXEMPT FROM THE ANNUAL
INCOME REQUIREMENT OF ONE HUNDRED MILLION PESOS (P100,000,000)
AS PROVIDED FOR IN PARAGRAPH (A) HEREOF TO BE QUALIFIED FOR
CONVERSION INTO A CITY;

PROVIDED FINALLY, THAT CAPITAL TOWNS OF PROVINCES WHERE
THERE ARE NO EXISTING CITY SHALL HAVE PRIORITY FOR CONVERSION
INTO COMPONENT CITIES;

(b) The territorial jurisdiction of a newly-created city shall be properly identified
in metes and bounds. The requirement on land area shall not apply where the city
proposed to be created is composed of one (1) or more islands. The territory need
not be contiguous if it comprises two (2) or more islands.

(c) The average annual income shall include the income accruing to the
general fund, exclusive of specific funds, transfers, and non-recurring income.”

Sec. 2. Plebiscite — Existing capital towns of provinces without cities are
hereby converted into component cities upon approval by a majority of the votes cast
in a plebiscite to be held in the said capital towns. The Department of Interior and
Local Government (DILG) shall submit to the Commission on Elections (COMELEC)
the list of capital towns, which qualify under this Act, within forty five (45) days from

the effectivity of this Act.


The COMELEC shall conduct and supervise such plebiscite in qualified towns
within one hundred twenty (120) days from receipt of the said list from the DILG.
The expenses of such plebiscite shall be borne by the capital towns concerned.

Sec. 3. Rules and regulations. — The DILG shall issue the necessary rules
and regulations within forty five (45) days after the effectivity of this Act.

Sec. 4. Applicability of Laws. - The provisions of Republic Act No. 7160
otherwise known as the Local Government Code of 1991, and other laws as are
applicable to cities, shall govern the capital towns, which are converted into cities
under the immediately preceding section, insofar as they are not inconsistent with
the provisions of this Act.

Sec. 5. Repealing Clause.— All laws, decrees, orders, rules and regulations,
and other issuances or parts thereof, Which are inconsistent with this Act, are hereby
repealed or modified accordingly.

Sec. 6. Effectivity. — This Act shall take effect fifteen (15) days after its
complete publication in at least two (2) national newspapers of general circulation.

Approved,