i ©
Republic of the Philippines
HOUSE OF REPRESENTATIVES iS RECEIVED
Quezon City TE DATE September 14, 2022
* TIME 8:57am.
19 CONGRESS
First Regular Session

HOUSE BILL NO. _4806 _

Introduced by. REP. JUAN CARLOS “ARJO” ATAYDE

AN ACT
PROVIDING FOR A NATIONAL HOUSING DEVELOPMENT, PRODUCTION AND
FINANCING PROGRAM REGULARIZING ITS APPROPRIATION FOR ITS.
IMPLEMENTATION

The 1987 Constitution recognizes the right of the Filipino people to decent
housing. Article XIII provides, “The State shall, by law, and for the common good,
undertake, in cooperation with the private sector, a continuing program of urban land
reform and housing which will make available at affordable cost, decent housing, and
basic services to underprivileged and homeless citizens in urban centers and
resettlement areas. It shall also promote adequate employment opportunities to such
citizens. In the implementation of such a program, the State shall respect the rights of
‘small property owners.”

In furtherance of the afore quoted provision, this measure seeks to address the
right of the underprivileged to affordable and decent housing services. Likewise, this
measure aims to strengthen, promote, and support the component activities of housing
production and finance by ensuring continuous and sustained funding support to scale
up the implementation of the major components of the National Housing Development
and Production Program.

In view of the foregoing, the approval of this bill is earnestly sought.

REP. JUAN CARLOS “ARJO” ATAYDE


RONnS

Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City

19" CONGRESS
First Regular Session

HOUSE BILL NO. _ 4806

Introduced by. REP. JUAN CARLOS “ARJO” ATAYDE

AN ACT
PROVIDING FOR A NATIONAL HOUSING DEVELOPMENT, PRODUCTION AND
FINANCING PROGRAM REGULARIZING ITS APPROPRIATION FOR ITS.
IMPLEMENTATION

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

SECTION 1. Title. - This Act shall be known as the "National Housing
Development, Production and Financing (NHDPF) Act of 2020."

SEC. 2. Declaration of Policy. - It is hereby declared a policy of the state to:
undertake, in cooperation with the private sector, a continuing program of housing and
urban development, which shall make available at affordable cost, decent housing and
basic services, especially to the underprivileged and homeless citizens. It shall
likewise pursue the realization of a modem, humane, economically viable and,
environmentally-sustainable society where the urbanization process is manifest in
towns and cities being centers of productive economic activity and is led by market
forces; where urban and rural areas have affordable housing, sustainable physical and
social infrastructure and services facilitated under the democratic and decentralized
system of governance; and where urban and rural areas provide the opportunities for
an improved quality of life and eradication of poverty.


anon

carne

20
21
22
23
24

25
26
27
28
29

Cognizant of the role of housing as a stimulus for economic growth and
development, it is hereby also declared a state policy to strengthen, promote and
Support the component activities of housing production and finance by ensuring
continuous and sustained funding support to scale up the implementation of the major
components of the National Housing Development and Production Program.

SEC. 3. National Housing Development Production Program Implementation. -
Consistent with the aforementioned policy and objectives, the Department of Human
Settlements and Urban Development (DHSUD) and its attached Key Shelter
Agencies, shall intensify the implementation of the vital componentsof the National
Housing Development Production and Financing Program. The implementation of this
program shall be carried out by the following agencies:

A. National Housing Authority (NHA) - the sole national government agency tasked to
implement and develop the following housing programs intended for the bottom 30%
of the income population:

1. Resettlement - This program addresses the requirements of families
affected by: a) government infrastructure projects; b) those living along danger areas;
and c) those affected by Supreme Court Mandamus. It entails the provision of vertical
(from § to 15-storey residential building) and/or horizontal housing units, community
facilities, socio-economic and other community support programs.

The program also involves the implementation of local/regional resettlement
projects as joint National Government-Local Government undertakings to address the
resettlement requirements of Local Government Units (LGUs) outside Metro Manita
involving families in danger areas, those affected by infrastructure projects, indigenous
peoples and former rebels.

The government infrastructure agencies shall submit an inventory of Informal
Settler Families to be affected by their projects and their location to the appropriate
housing agencies at least two years prior to its implementation and shall incorporate
in their respective project costs the amount needed for the relocation and resettlement
of affected families.


on

cane

"
12
13

14
15
16

7
18
19
20

2
22
23
24
25
26
27
28

2. Government Employees Housing Program - this program is intended to
provide decent and affordable housing to low-salaried government employees.

3. Settlements Upgrading - this program aims to address the security of
tenure and infrastructure requirements of informal settlements on government-owned
lands proclaimed or designated as socialized housing sites.

4. Housing Program for Calamity Victims - this program is intended to
respond to the housing needs of low and marginal-income and/or informal shelter
families for transitional and/or permanent shelter affected by calamities such as
typhoons, landslides, earthquakes, and fires for relocation to safe areas.

5. Land Banking - this refers to the acquisition of land, which includes idle
government lands, at values based on existing use in advance of actual need to
promote planned development and socialized housing programs with a view to
distribute the land to qualified socialized housing beneficiaries.

It covers survey and titling of individual lots for disposition to qualified
occupants, infrastructure development, housing construction and rehabilitation of
existing project sites.

6. Social Housing Finance Corporation (SHFC) - mandated to undertake
social housing programs that will cater to the formal and informal sectors in the low-
income bracket and to take charge of developing and administering social housing
programs, particularly the Community Mortgage Program and its different modalities:

a. Community Mortgage Program (CMP) - this is a mortgage financing
program, which assists legally organized associations of underprivileged
and homeless citizens to purchase and develop a tract of land under the
concept of community ownership. The primary objective of the program
is to assist residents of blighted or depressed areas to own the lots they
occupy, or where they choose to relocate to, and eventually improve
their neighborhood and homes to the extent of their affordability. The
different modalities of the CMP are as follows:


Noanwn a

10
"1
12
13

2
22
23
24

25
26
27
28

29

31

i. Sectoral CMP - a CMP modality that caters to the different
sectoral groups including but not limited to the basic sector groups
needing resettlement assistance. A sectoral group represents a
group or coalition of persons who share similar concems and
interests and intend to avail of resettlement assistance from
SHFC, including Indigenous Peoples (IPs), Indigenous Cultural
Communities (ICs), and other ethnic minority groups.

li. Housing for Peace Process and Nation Building CMP - a CMP

modality that would lead to the achievement of national peace and
development through the provision of housing to former
rebels/rebel retumees (FR/RR). This also includes rebuilding
damaged or destroyed homes in post-conflict-areas of internally-

displaced persons (IDPs).

il, Post-Disaster Rehabilitation and Reconstruction CMP - a CMP
modality that provides assistance to community housing projects
in times of disaster. This program allows the communities to
immediately embark on house construction and site development
which adhere to the minimum standards and specifications of the
design and structural components of disaster-resilient housing
projects, as well as materials.

iv. Industrial Workers CMP - a CMP modality intended primarily for
low-income employees of companies engaged in agro-industrial,

industrial processing zone, tourist, recreational, commercial, and

other enterprises.

v. Site Upgrading/Development CMP - a CMP modality intended to
provide site development and housing/building construction
loans for projects whose lands are donated by private or public
entities applicable to both on-site or resettlement projects.

vi. Mixed-Use CMP - a CMP modality aimed at developing a self-
sustaining community by having a balanced mix of residential and

commercial

spaces,

4

well-developed

infrastructure,

and


RON

eorxnoa

10
"1
12
13
14

15
16
7

19
20
21
22
23

24
25
26

27
28
29

recreational amenities along with green and open spaces and
wellness areas. Under this modality, 9% of the project area shall
be allotted for green spaces and 1% of the project area for friendly
facilities for Persons with Disabilities (PWD)

B. National Home Mortgage Finance Corporation (NHMFC) - A government
corporation mandated to increase the availability of affordable housing loans to finance
Filipino homebuyers on their acquisition of housing units through the development and
operation of a secondary market for home mortgages.

7. Securitization - this refers to the development of the secondary market
for home mortgages and other housing-related receivables, conveyances and
financial instruments and the development/promotion of and investments in new
housing-related financial instruments and investment vehicles and the capital markets
thereof. Furthermore, this would also increase and sustain funds available for housing
and home development.

C. Department of Human Settlements and Urban Development (DHSUD) - the
primary national government entity responsible for the management of housing,
human settlements and urban development including the implementation of the
following programs:

8. Public Housing - this is a housing program that is owned and/or
managed by the government for the purpose of providing security of tenure to the
underserved families including but not limited to the development of proclaimed
socialized housing sites intended to promote the establishment of new towns, new
settlements, and urban renewal.

The term "underserved families" refers to those who are disadvantaged in terms
of access to basic services because of inability to pay or other disparities by reason of
economic or social status, ethnicity, geographical isolation, and other circumstances.

9. Subsidy - this is a financing assistance scheme intended to enhance the
affordability of well targeted and most financially incapable segment of the society. It
is a grant extended to qualified low-income beneficiaries under the National Housing


1
2

oan

~

10

12
13

14
15
16

7

19
20
2
22

23
24

25
26
27
28
29

Development and Production Financing Program under any of the following alternative
subsidy schemes:

i. Extension of Interim Shelter Fund to each of the family-beneficiaries
which they can use to find safe residency and livelihood to support their
families, pending the completion of their housing units in the relocation
sites.

Payment for upfront cost equivalent to 5% of the project cost (eg.,
mortgage insurance, titing, etc.); and

Monthly payment subsidy for the first five years of the loan period in
accordance with Section 3 (a) of RA 6846 or the Social Housing Support
Fund Act. The department shall be authorized to establish the
qualification and income requirements of borrowers who will qualify for
the amortization support subsidy.

The DHSUD, in coordination with the LGUs and other national government
agencies, shall be authorized to formulate the criteria and guidelines to select the
beneficiaries that may qualify for the subsidy program.

10. Public Rental Housing - this program involves the extension of fiscal
assistance of up to a maximum of 50% of the total construction cost for the National
Government Agencies (NGAs) and Local Government Units (LGUs) that shall
construct and operate public rental accommodation to eligible low-income families and
housing safety net for the vulnerable sectors (e.g., senior citizens, person with
disabilities, etc.)

The DHSUD shall formulate the guidelines for the implementation of public
rental housing assistance including the adoption of the lease/rental buy-back scheme.

11. Survey of proclaimed lands for socialized housing and inventory of
government idle lands - this involves the survey of all occupied government lands
prociaimed by the President as suitable for socialized housing and conduct of
inventory of government lands which have been idle for more than ten (10) years
except lands owned by the GOCCs and government financial institutions engaged in


Secarnaarn

12
13

15
16
7

18
19
20

2
22
23

24
25
26

27
28
29

Shelter financing as part of its fiduciary obligations to its member and/or taken
Possession of in their ordinary conduct of business.

12. Such other program components as may be determined by the DHSUD.

SEC. 4. Appropriations by the National Goverment. - The amount of One
Hundred Thirty-Five Billion One Hundred Fourteen Million Pesos (Php
135,114,000,000) or such amount necessary to carry out the provision of this Act is
hereby authorized to be appropriated annually through the General Appropriations
Act over a period of twenty (20) consecutive years commencing from the year
immediately succeeding the effectivity of this Act or until such time that the total fund
requirements provided for in this Act shalll have been fully released.

A total amount of Two Trillion, Six Hundred Sixty-Seven Billion, Two Hundred
Ninety-Three Million Pesos (Php 2,667,293,000,000) covering the continuing
requirement of this Act shall be appropriated to the DHSUD and Key Shelter Agencies
for the implementation of the following component programs of the NHDPF Program:

1. One trillion, seven hundred twenty-two billion, four hundred forty-six
million pesos (Php 1,722,446,000,000) for the implementation of the following
programs of NHA:

2

Eight hundred billion and six hundred ninety million pesos (Php
800,699,000,000) to finance the Resettlement Program under Section
3.A(1) of this Act;

s

Five hundred forty-three billion and four hundred nineteen million pesos
(Php 543,419,000,000) as subsidy for Government Employees Housing
under 3.A(2) of this Act;

°

One hundred sixty-four billion and two hundred sixty-five million pesos
(Php 164,265,000,000) for the Settlements Upgrading under Section
3.A(3) of this Act;

2

One hundred one billion and seven million pesos (Php 101,007,000,000)
for the Housing Program for Calamity Victims Section 3.A(4) of this Act:
and


14
15
16

7
18
19
20

21
22
23

24
25

26
27

@. Sixty-three billion and fifty-six million pesos (Php 63,056,000,000) for the
Land Banking under Section 3.A(5) of this Act.

2. Four hundred fifty-three billion, two hundred million pesos (Php
453,200,000,000) for the implementation of the Community Mortgage Program under
Section 3.A(6) of this Act.

3. Fifty billion (Php 50,000,000,000) for the Capitalization of NHMFC under
Section 4(8) of this Act.

4. Four hundred seventy-six billion, six hundred forty-seven million pesos
(Php 476,647,000,000) for the implementation of the following programs of the
DHSUD:

»

Three hundred sixty-five billion, nine hundred seventy-nine million pesos
(Php 365,979,000,000) to finance the Public Housing under Section
3.C(8);

s

Eighty-nine billion, one hundred hirty-one million pesos (Php
89,131,000,000) as subsidy under Section 3.C(9), broken down as
follows:

i. Eighteen billion, five hundred thirty-one million pesos (Php
18,531,000,000) as interim shelter finance assistance for the
informal settler-families who will be relocated under Section
3.C(9i);

|. Sixty-three billion, seven hundred ninety-six million pesos
(Php 63,796,000,000) as upfront subsidy under Section
3.C(Qii);

iii, Six billion, eight hundred four million pesos (Php
6,804,000,000) as amortization support under Section 3.C (Gili.

c. Twenty billion, four hundred fifty-six million pesos (Php 20,456,000,000)
to finance public rental housing under Section 3.C(10); and


d. One billion, eighty-one million (Php 1,081,000,000) to finance ‘survey of
proclaimed lands and conduct of inventory of government idle lands
suitable for socialized housing under Section 3.C(11).

SEC. 5. LGU Sources of Funds. - Section 43 of RA 7279 on Socialized Housing
Tax is hereby amended, to read as follows:

SEC. 43. Socialized Housing Tax. - Consistent with
the constitutional principle that the ownership and
enjoyment of property bear a social function and to
raise funds for the Program, all local goverment
units are hereby authorized to impose an additional
one-half percent (0.5%) tax on the assessed value
of alll lands in urban areas in-excess—ot Fifty

thousand—peses—{P50,000). THE PROCEEDS
FROM THE IMPOSITION OF SOCIALIZED

HOUSING TAX SHALL ACCRUE TO THE
SPECIAL FUNDS OF THE LGUS, WHICH SHALL
BE USED FOR THE DEVELOPMENT OF
SOCIALIZED HOUSING PROJECTS AND
CONSTRUCTION AND ESTATE MANAGEMENT
OF PUBLIC RENTAL HOUSING OF THE LGUS.

SEC. 6. Implementation of the Securitization, Capital and Secondary Mortgage
Operations Program. - The NHDP Securitization for the development of the secondary
market for home mortgages of and other housing related receivables, conveyances
and financial instruments and the development/promotion of and investments in new
housing related financial instruments and investment vehicles and the capital markets
thereof, to increase and sustain funds available for housing and home development
shall be implemented as follows:

3 The NHMFC shall be the sole implementing agency for the NHDP
‘securitization; and


16
7
18
19

20
a
22
23
24
25
26
27

28
29

2. The NHMFC in coordination with the DHSUD, DOF and BSP and other
concemed agenciesand private sector organizations, shall formulate a program, the
proceeds of which shall accrue to the Centralized Housing Fund.

3. The mortgages to be generated as a result of the implementation of the
component programs of the NHDP Program shall be sold and transferred to NHMFC,
which shall also serve as an asset pool for securitization.

4. The NHMFC as the sole agency for the implementation of the NHDPA
Securitization shall manage the whole securitization process which includes the
following activities: determining the eligibility criteria for the asset pool; defining the
preliminary structure of the notes, bonds and or instruments to be issued, third parties
to be hired; and education/briefing of target investors for all the issues.

5. The NHMFC and NHDPFA-issued bonds, notes and securities shall be
exempt from the registration requirements under the Securities Regulation Law in
order to accelerate the issuance of its housing related securities/financial instruments
and, thus, more reasonably provide the necessary fund for housing developments.

6. Transactions by banks involving the purchase and sale of housing
bonds, debentures and such other similar instruments shall be exempt from the twenty
percent (20%) final tax on income, documentary stamps tax, gross receipts tax and
value added tax.

7. The investors’ yield or income from any socialized housing or economic
housing-related bond or asset-backed securities (ABS) issued by NHMFC directly or
through a special purpose entity under the Securitization Act shall be exempt from
income tax. Such issuances shall enjoy all the tax exemptions granted under Republic
Act No. 9627 or the Securitization Act of 2004 pursuant to the State's policy of
promoting the securitization of mortgage and housing- related receivables of
government housing agencies, to generate investment and accelerate the growth of
the housing finance sector, especially for socialized and economic housing.

8. Bonds purchased by private real estate developers shall be considered
as an alternative compliance to the balanced housing requirements under section 18


15
16
7
18
19
20
a
22
23
24

25
26
27

28
29
30
31

of RA 7279 as amended by RA 10884, subject to the rules promulgated by the
Department of Human Settlements and Urban Development.

9. The Philippine Guaranty Corporation created pursuant to Executive
Order No. 58 (S. 2018) shall guaranty payment of the balance outstanding and due on
the guaranteed principal obligation, plus interest and yields thereon up to eleven
Percent (11%) per annum for socialized housing packages, ten percent (10%) per
annum for low-cost housing packages, nine and a half percent (9.5%) per annum for
medium-cost housing packages and eight and one-half percent (8.5%) per annum for
open housing packages.

SEC 7. Capitalization of National Home Mortgage Finance Corporation
(NHMFC). - The authorized capital stock of the NHMFC is hereby increased from Php
5,500,000,000 pesos to Php 50,000,000,000 pesos to expand its leveraging capacity
based on the volume of mortgage loans being serviced to improve its profitability by
reducing the average cost of its fund made available for home lending programs.

The capital of the NHMFC shall be Fifty billion pesos (Php 50,000,000,000), to
be fully subscribed by the Government of the Republic of the Philippines, hereafter
referred to as the Government: Provide That the Php 25,000,000,000 of the
capitalization shall be funded from the General Appropriations Act and the remaining
Php 25,000,000,000 shall be funded from the declared dividends of the NHMFC in
favor of the National Government. For this purpose, any and all declared dividends of
the NHMFC in favor of the National Government shall be deposited in a special
account in the General Fund, and earmarked for the payment of NHMFC's increase in
capitalization. Such payment shall be released and disbursed immediately and shall
continue until the increase in capitalization has been fully paid.

SEC. 8. Tax Exemptions. - The NHMFC shall be exempt from all national,
provincial, municipal and city taxes on income derived from its governmental functions,
specifically income from its activities or transactions in the exercise of its mandates.

SEC. 9. Multi-Year Obligational Authority - The Secretary of the DHSUD and
Heads of its attached housing agencies, pursuant to the National Housing
Development, Production and Financing Program, projects and appropriations
approved by Congress, shall, subject to the provisions of existing laws and regulations

"1


Ron

corona

19
20
2
22

23
24
25
26
27
28

29
30
31

including those of the Commission on Audit and other such terms and conditions most
favorable to the government, be given multi-year obligational authority for housing
program or project which will take more than one year to complete that requires multi-
year appropriations.

SEC. 10. Private Sector Participation - To fast track the approval and
implementation of housing projects and reduce the cost of socialized and low-cost
housing units, the Bureau of Internal Revenue, the Department of Agriculture, the
National Irrigation Authority, the Philippine Coconut Authority, the Sugar Regulatory
Administration, the Department of Agrarian Reform, the Department of Environment
and Natural Resources, the Mines and Geosciences Bureau, the Laguna Lake
Development Authority the Department of the Interior and Local Government, the
Local Government Units, the Land Registration Authority and the Department of
Human Settlements and Urban Development shall facilitate the release of the required
housing-related permits, licenses, certifications and tax exemptions/rulings in
accordance with Republic Act 11032 or an Act Promoting Ease of Doing Business and
Efficient Delivery of Government Services Amending for the Purpose Republic Act
9485 Otherwise Known as the Anti-Red Tape Act of 2007 and for Other Purposes and
Executive Order No. 45 (S. 2001).

In case the responsible officers of the agencies concemed fail or refuse to
dispose of the application within the periods prescribed under RA 11032, the
applicable administrative and criminal liability as stated in Section 22 of RA 11032
shall be imposed.

All the incentives enumerated under Section 20 of Republic Act 10884 or an
Act lo Strengthening the Balanced Housing Development Program, amending for the
Purpose Republic Act No. 7279, as Amended, otherwise known as the Urban
Development and Housing Act of 1992 shall be extended to the private sector engaged
in socialized and low-cost housing development including the construction and estate
management of public rental housing.

The participation of owners and/or developers in any of the component
programs of the NHDPFA shall be treated as one of the manners of compliance to the
balanced housing requirements subject to the conditions set forth under RA 10884.

12


13
14

15

SEC. 11. Collection Efficiency. - In order to improve collection efficiency, the
NHA, SHFC and NHMFC shall have authority to foreclose mortgages, and/or evict
beneficiaries in accordance with existing laws.

SEC. 12. Implementing Rules and Regulations. - The DHSUD shall promulgate
Tules and regulations necessary for the implementation of this Act.

SEC. 13. Separability Clause. - Any portion or provision of this Act that is
declared unconstitutional shall not have the effect of nullifying other portions or
Provisions hereof as long as such remaining portions can stil subsist and be given
effect in their entirety.

SEC. 14. Repealing Clause. - All laws, ordinances, rules, regulations, other
issuances, or parts thereof, which are inconsistent with this Act, are hereby repealed
or modified accordingly.

SEC. 15. Effectivity. - This Act shall take effect after fifteen (15) days following
its publication in the official Gazette or in a newspaper of general circulation.

Approved,