Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City

THIRTEENTH CONGRESS,

House Bill No._220

Introduced by Hon. Rozzano Rufino B. Biazon

EXPLANATORY NOTE

The country is beset by the problem of shelter. It is evident especially in highly
urbanized cities and municipalities where colonies of informal settlers can be seen
sprouting in private and public land. Even danger zones such as railroad tracks and the
banks of esteros and rivers have become sites of improvised settlements for our less
fortunate countrymen.

While at present, there exist government agencies tasked to address certain
aspects of the shelter program, the government needs to focus its efforts and its limited
available resources to make it more effective and efficient.

This bill seeks to create a Department of Housing and Urban Development to
rationalize the shelter and urban development program of the national government. It will
streamline the bureaucracy and the process of formulating human settlement programs to
meet the demands of our increasing population and decreasing space. As a full-pledge
Department, the shelter program shall likewise be elevated in priority and the attention
given by national government to the problem of shelter will become focused and
significant.

Because this bill has been pending in the past three Congresses, it is the desire of
this representation that this proposal be approved and passed into law in the 13”

Congress.
ROJFANO RUFINO B. BIAZON

Representative
Lone District of Muntinlupa City


Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City
THIRTEENTH CONGRESS

First Regular Session

House Bill No._ 220

Introduced by Hon. Rozzano Rufino B. Biazon

AN ACT
CREATING THE DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT,
RATIONALIZING THE ORGANIZATION AND FUNCTIONS OF GOVERNMENT
AGENCIES AND CORPORATIONS RELATED TO HOUSING AND URBAN
DEVELOPMENT, AND FOR OTHER PURPOSES

Be it enacted by the Senate and House of Representatives of the Philippines in Congress
assembled:
CHAPTER I
GENERAL PROVISIONS

SEC. |. Title. - This Act shall be known as the “Omnibus Housing and Urban Development Act of
2004.”

SEC. 2. Declaration of Policy. — It is hereby declared the policy of the State to:

(a) Undertake a comprehensive and continuing program of housing and urban development which
will make available at affordable cost, decent housing and basic services to the Filipino people, especially
those who are underprivileged and homeless;

(b) Adopt workable policies that will guarantee the rationalization and optimum utilization of land
and resources in order to meet the spatial and physical requirements of housing and urban development
and create a more balanced urban-rural interdependence;

(c) Develop a sustainable and viable housing finance system that shall tap alternative, including
non-traditional sources of funds, for the government's housing program;

(d) Rationalize and strengthen the urban development and shelter delivery system of the
government by enhancing local autonomy and decentralization and provide local government units more
power, authority, responsibility and resources; and

(e) Encourage more effective peoples’ participation by institutionalizing their involvement at all
levels of the urban planning and development process.

SEC. 3. Definition of Terms. ~ For purposes of this Act, the terms or words and phrases used shall
mean or be understood as follows:

(a) “Abot-Kaya Pabahay Fund” refers to the fund established under Republic Act No. 6846,

otherwise known as “The Social Housing Support Fund Act”, as amended by Republic Act No.
7835, otherwise known as “The Comprehensive and Integrated Shelter Financing Act of 1994.”
The Fund shall be used exclusively to enhance the affordability of low-cost housing by


low-income families through its four (4) components, namely: amortization support,
developmental financing, cash flow guaranty, interest subsidy and liquidity support.

(b) Agricultural Land Conversion refers to the undertaking of any activity that will modify
or alter the physical characteristics of agricultural lands to render them suitable for non-
agricultural purposes with an approved order of conversion from the secretary of the Department
of Agrarian Reform (DAR).

(c) CISFA refers to Republic Act No. 7835.

(d) “Community mortgage program” refers to the mortgage-financing program of the
National Home Mortgage Finance Corporation (NHMFC), which assists legally organized
associations of underprivileged and homeless citizens to purchase and develop a tract of land
under the concept of community ownership.

(e) “Formal sector” refers to members of the Government Service Insurance System
(GSIS), Home Development Mutual Fund (HDMF) and the Social Security System (SSS).

(e) “Homeless and underprivileged” refers to the beneficiaries of Republic Act No. 7279,
otherwise known as the “Urban Development and Housing Act” (UDHA), and to individuals or
families whose income or combined household income falls within the poverty threshold as
defined by the National Economic and Development Authority (NEDA), who do not own
housing facilities, who live in makeshift dwelling units, and do not enjoy security of tenure.

(f) “Informal sector” refers to non-members of the GSIS, HDMF and the SSS.

(g) “New town” refers to any large-scale planned development, which includes housing,
work places, and related facilities within a more or less self-contained environment.

(h) “Secondary mortgage market” refers to the system, which entails purchase, acquisition,
discounting or refinancing of loan and mortgage packages or participations therein, These
instruments, in turn, are traded in the financial market through issuance and/or sale of bonds,
promissory notes, debentures, conveyances and other financial instruments or participation
therein, backed by the same pool or mortgages, securitizations, and other assets.

(i) “Socialized housing” refers to housing programs and projects covering houses and lots
or home lots only undertaken by the goverment or the private sector for the underprivileged and
homeless citizens which shall include sites and services development, long term financing,
liberalized terms on interest payments, and such other benefits in accordance with the provisions
of this Act.

(j) “Urban development” refers to the process of occupation and use of land or space for
such activities as residential, industrial, commercial and the like, necessary to carry out the
functions of city life. It entails building or rebuilding of more or less permanent structures over
Jand that is often withdrawn or converted from its original use, resulting in the creation of the
built environment.

(k) “Urban planning” refers to a process, also called city planning or town planning, that

involves planning for diverse elements that comprise an urbanized area, including its physical


infrastructure, environment, housing and transportation, and management of land use and urban
growth.

(1) “Urban renewal” refers to the idea of consciously renewing the outwom areas of towns
and cities, through redevelopment and rehabilitation.

SEC. 4. Statement of Objectives. — Toward this end, the State shall:

(a) Formulate and oversee the implementation of a comprehensive housing and urban
development policy as an integral part of national development plans to regulate and direct urban
growth and expansion towards a dispersed urban net and to achieve a more balanced urban-rural
interdependence;

(b) Undertake with the participation of the private sector a continuing comprehensive,
affordable and sustainable housing program;

(c) Establish a sustainable housing finance system that ensures affordable housing through
low down payment, long-term financing and low interest rate;

(d) Improve coordination of national government housing and urban development policies
and programs and extend adequate technical and material assistance to local government units;

() Encourage participation of all stakeholders in housing and urban development, such as
local government units (LGUs), nongovernmental organizations (NGOs), peoples’ organizations
(POs) and the private sector;

(f) Rationalize the structure, powers and functions of the different housing and urban
development agencies and integrate all housing and urban development policies, plans, programs
and projects of various government corporations and agencies to expedite the delivery of decent,
affordable and sustainable housing and urban development programs and projects; and

(g) Promote the application of technologies that reduce costs and improve the quality of
habitability of housing.

CHAPTER IL
THE DEPARTMENT PROPER,

SEC. 5. Creation of the Department of Housing and Urban Development. - To carry out
the above-declared policy, there is hereby created a Department of Housing and Urban
Development, hereinafter referred to as the Department.

The Department shall be the primary agency of government that will prepare, integrate,
coordinate and supervise plans, programs, projects and activities of the government relative to
urban planning, development, and renewal, including land use and zoning, housing provision,
regulation and finance, and marginal settlement assistance and services.

SEC. 6. Powers and Functions, - The Department shall have the following powers and
functions:

(a) Formulate, implement and update, consistent with approved national development plans
and guidelines on land use, a comprehensive National Urban Development and Housing

Framework. This Framework will specify the policies, plans, programs, strategies and


mechanisms in order to promote a sustainable, ecologically-sound and well-govemed housing
and urban development;

(b) Provide for the development of: (1) a sustainable market-oriented housing finance
system which promotes the adequate flow of private funds into the primary and secondary
mortgage markets; and (2) a complementary system of well-targeted and transparent housing
subsidy mechanisms for the less privileged and homeless;

(c) Ensure the provision of adequate housing stock to meet the needs of all income groups,
especially the underprivileged and homeless in urban centers and in resettlement and rural areas;

(d) Pursue an urban renewal of blighted and slum areas, the resettlement and relocation of
informal dwellers, and the containment of squatting, pursuant to law, in a just and humane
manner;

(©) Supervise all corporations and agencies attached to the Department namely: Home
Guaranty Corporation (HGC), National Housing Authority (NHA), National Home Mortgage
Finance Corporation (NHMFC), Home Development Mutual Fund (HDME), and Housing and
Urban Development Adjudication Commission (HUDAC), to: (1) ensure adherence, consistency
and integration with Department policies, plans and programs; and (2) monitor the performance
and soundness of their management and financial policies in accordance with the government’s
housing and urban development framework;

(©) Promulgate, amend or repeal such rules and regulations as may be necessary to
complement the intent and purposes of this Act, which, upon approval by the President and after
due publication thereof, shall have the force of law;

{g) Effect and oversee a single regulatory system that shall govern all activities relative to
the planning, production, marketing and maintenance of residential and commercial development
projects;

(h) Develop and establish a sector performance monitoring and assessment mechanism and
monitor and report on the performance of the sector, national government agencies and LGUs in
urban development and housing to enable continuing improvements in sector policy and strategy
formulation;

(i) Adopt and promulgate development standards and guidelines that shall govern the
preparation and implementation of land use plans and zoning ordinances of LGUs and property
development of the public and private sectors;

{j) Provide technical assistance and information to assist LGUs in developing solutions to
problems on housing, community, and urban development and/or renewal;

(k) Coordinate the development activities of LGUs toward a more effective housing
delivery, optimal land use, and the balanced growth of urban and urbanizing communities in

relation to demographic factors, productive capacity and natural resource endowment;


(I) Exercise initiative and, under the directions of the President, assume a lead role in
coordinating the activities of other agencies and instrumentalities that impact on urban
development;

(m)Call on other agencies or instrumentalities of the government and private entities for
cooperation and assistance in the performance of its functions;

(n) Monitor compliance and provide policy directions, standards and technical assistance to
LGUs in the preparation of their respective land use plans and zoning ordinances, subject to the
over-all land use plan of the regional development councils and the NEDA:

(0) Undertake a rational, balanced, orderly and efficient development of new settlements
and the redevelopment of existing urban communities that indicate potentials for accelerated
growth. Such activities shall assure the dwellers thereon of decent and affordable housing, job
and livelihood opportunities, efficient mass transit, public safety, health care, educational
opportunities and clean environment;

(p) Conduct continuing research and development of innovative and indigenous
technologies that will enhance housing affordability;

(q) Ensure consumers’ education and protection and establish and administer mechanisms
such as the development, maintenance, updating and upgrading of an industry information
system and data bank which shall include a master list of beneficiaries;

() Establish a mechanism to identify, update, validate and determine full eligibility of
target beneficiaries for socialized housing programs and projects in order to maximize
government resources and avoid double availment of such programs and projects;

(s) Discharge all responsibilities of government that may arise from agreements and other
commitments on housing, land use and urban development to which it is a signatory, including
the determination of forms of assistance for housing, land use and urban development to be
extended through multilateral or bilateral assistance program;

(t) Determine, fix and collect reasonable amounts to be charged as administrative fees,
fines and penalties; as well as issue motu propio, after the conduct of appropriate investigation,
notices of violation, cease and desist and/or closure and demolition orders, ejectment and
summary abatement orders, necessary for the effective implementation of all laws, rules and
regulations, and other legal issuances enforced by the Department;

(u) Determine, fix and collect reasonable amounts to be charged as administrative fees,
fines and penalties on any natural or juridical person who practice real estate services without
any license; and

(v) Perform such other acts not inconsistent with this Act as are necessary to achieve its
purposes.

SEC. 7. Composition. — The Department shall be headed by a Secretary. The Department
proper shall be composed of the Office of the Secretary, the Offices of the Undersecretaries and
Assistant Secretaries, the bureaus, services, and other offices of the Department.


SEC. 8. The Secretary. — The Secretary shall be appointed by the President, subject to the
confirmation by the Commission on Appointments.

The Secretary in addition to the regular powers and functions provided under Section 7,
Chapter 2, Book IV of the Administrative Code of 1987, shall have the following powers and
functions:

(a) Provide executive direction, control and supervision over the entire operations of the
Department;

(b) Rationalize delivery systems as is necessary for the effective attainment of the
objectives of the Department, including the creation of regional and field offices, other service
units and divisions, and the delegation of authority to regional and field offices for decentralized
programs, subject to the provisions of existing laws;

(c) Call on other government and private entities for cooperation and assistance in the
performance and discharge of the Department's functions;

(d) Coordinate with LGUs, other agencies, and public and private interest groups,
including NGOs and POs on Department policies and initiatives;

(e) Restructure the internal organization of the Department, subject to the approval of the
President;

(f) Recommend to the President on the restructuring of the structures of its attached
agencies and corporations;

(g) Review existing rules and regulations governing financing schemes, homeowners
associations and other issues attendant to the different shelter programs and projects, with the
‘end in view of ensuring their effectiveness and efficiency; and

(h) Formulate such rules and regulations and exercise such other powers as may be
necessary to implement the objectives of this Act.

SEC. 9. The Undersecretaries. — The Secretary shall be assisted by two (2)
Undersecretaries, who shall be appointed by the President upon the recommendation of the
Secretary: Provided, That one of the Undersecretaries shall be a career officer coming from the
ranks of the existing government housing agencies and offices. They shall have the powers and
functions as provided for in Section 10, Chapter 2, Book IV of the Administrative Code of 1987,
and other powers and functions that will be assigned by the Secretary.

The Offices of the Undersecretaries shal] consist of the Undersecretaries and their
respective immediate staff.

SEC. 10. Assistant Secretaries. ~ The Secretary shall be assisted by a maximum of three (3)
Assistant Secretaries who shall be career officers appointed by the President upon the
recommendation of the Secretary.

The respective assignments of the Assistant Secretaries shall be determined by the
Secretary.


SEC. 11. Qualifications. - No person shall be appointed Secretary, Undersecretary or
Assistant Secretary of the Department unless he is a citizen and a resident of the Philippines, of
good moral character, and of proven competence and integrity,

SEC. 12. Bureaus. — The Department shall have the following Bureaus: (a) Financial and
Institutional Development Bureau, (b) Urban Development Bureau, (c) Housing Technology
Bureau, (d) Realty Regulation and Consumer Protection Bureau, and (e) Settlements and Social
Housing Bureau.

The bureaus shall perform the following functions:

(a) Financial and Institutional Development Bureau —

(1) Provide fiscal and financial incentives to LGUs, the private sector, NGOs and POs to
encourage their full participation in ensuring adequate housing stock especially for low-income
families;

(2) Institute a mechanism to ensure a consistently high collection efficiency and the
viability of the national shelter program;

(3) Assist in and facilitate the sourcing of adequate housing and urban development funds
from foreign, local and other alternative sources;

(4) Facilitate the development of a sustainable market-oriented housing finance system
which promotes the adequate flow of private funds into the primary and secondary mortgage
markets;

(5) Administer programs to LGUs, community associations, cooperatives and other private
groups to improve their capability to engage in all aspects of urban development/renewal
programs, housing and resettlement, including the restoration of neighborhoods, the investment
in or improvement of public facilities, and the rehabilitation of housing;

(6) Extend technical assistance to the local housing board or any special body on housing
within an LGU and housing cooperatives in the preparation of local shelter plans and projects;

(7) Accredit, train and extend assistance to homeowners’ associations or cooperatives of
targeted beneficiaries for purposes related to housing, and evaluate and recommend the same for
possible availment of a housing program or project;

(8) Monitor the implementation of projects and programs under its jurisdiction; and

(9) Perform such other related functions as may be assigned to it by the Secretary.

(b) Urban Development Bureau —

(1) Promulgate appropriate rules and regulations for the proper implementation and
enforcement of predetermined national standards and guidelines on land use, urban planning and
development;

(2) Install new and appropriate mechanisms for the extension of technical and other forms
of assistance to LGUs to ensure that their land use plans and zoning ordinances are consistent
with prescribed standards and guidelines and national policies and other issuances of the
Department and the NEDA;


(3) Coordinate with the Public Estates Authority (PEA) in the development of new towns
with complete basic facilities and services in urbanizable and urbanizing areas, including the
identified growth areas such as, but not limited to, CALABARZON, East Asian Growth Area
and the North Quadrangle, in order to decongest existing urban communities;

(4) Assist the LGU in undertaking a rational, well-balanced, orderly and efficient
redevelopment/renewal of existing urban communities;

(5) Assist in the formulation and updating of national objectives for housing and urban
development, specifically the National Urban Development Framework;

(6) Monitor the implementation of projects and programs under its jurisdiction; and

(7) Perform such other related functions as may be assigned to it by the Secretary.

(c) Housing Technology Bureau —

(1) Study and promulgate appropriate standards on all types of housing construction;

(2) Review and update national standards and technical requirements for economic and
socialized housing projects;

(3) Accredit, promote and encourage the development and utilization of innovative
housing technology that can reduce the cost of housing and within the reach of the poor without
sacrificing safety requirements, and provide for the prototyping/piloting of the same;

(4) Provide awards, incentives and citations to innovative and ingenious discoveries and
inventions in coordination with the Department of Science and Technology (DOST) and the
Board of Investments (BOD);

(5) Publicize findings and research on new technologies;

(© Participate in local and international expositions, competitions, and various research
and development activities on housing technology;

(7) Monitor, evaluate and validate the programs and projects under its jurisdiction; and

(8) Perform such other related functions as may be assigned to it by the Secretary.

(d) Realty Regulation and Consumer Protection Bureau —

(1) Oversee the enforcement of the approved rules, regulations and standards on all types
of housing developments such as subdivision, condominium, townhouse, single-detached or
multi-unit housing, industrial subdivisions, industrial condominiums, farm subdivisions, resort
and leisure estates, memorial parks, office/commercial condominiums, condominium-hotels
(condotels) and commercial centers;

(2) Oversee the issuance by the regional offices of certificates of registration and licenses
to sell for all real estate development projects, and the collection of the necessary penalties, fines
and fees, and monitor, assess and investigate compliance with approved subdivision and
condominium plans;

(3) Continually streamline the implementation and enforcement of regulations, including
the regulatory aspect of the urban land reform program, the Subdivision and Condominium


Buyer's Protective Decree, land value and building rental regulations, Rent Control Law, and
other related laws;

(4) Undertake the acceptance and initial processing of complaints of housing related cases
mentioned in Section 23 of this Act and the referral of the same to the housing arbiters;

(5) Accredit duly licensed brokers, through their organizations, to source lands for project
development and to market certain housing inventories or to solicit qualified beneficiaries;

(6) Accredit developers to undertake the development of certain urban lands;

(7) Register, issue certificates of incorporation to, and regulate homeowners’ associations
and condominium corporations organized pursuant to Presidential Decree No. 957, Republic Act
No. 4726, Presidential Decree No. 902-A and other related laws;

(8) License real estate brokers, real estate appraisers and real estate consultants;

(9) Develop and implement real estate consumer education and protection programs;

(10) Promote public trust and consumer education through the implementation of a
strategic communications plan that will offer timely dissemination of accurate and updated
information on the department’s policies, plans, programs and projects;

(11) Monitor the implementation of projects and programs under its juris

ction; and

(12) Perform such other related functions as may be assigned to it by the Secretary.

(@) Settlements and Social Housing Bureau —

(1) Ensure that relevant government housing programs shall make available to the lowest
thirty percent (30%) of the income earners decent and affordable housing with basic services and
employment opportunities;

(2) Formulate and ensure the enforcement of policies, rules and regulations governing
socialized housing provision, upgrading provision of tenure and improvement of informal
settlements;

(3) Formulate and enforce policies, rules and regulations governing resettlement,
relocation, eviction and demolition activities and for this purpose, issue relocation/eviction
compliance clearances for national or local government projects which will involve the eviction
or demolition of structures of homeless and underprivileged citizens in accordance with Republic
‘Act No. 7279 (UDHA) and implementing rules and regulations (IRR);

(4) Implement the conduct of pre-relocation and post-relocation activities for national
government programs and projects in accordance with Section 28 of Republic Act No. 7279
(UDHA) and IRR;

(5) Coordinate with the local housing board or any special body on housing or urban poor
concerns within the LGUs and other concerned agencies on the pre-relocation and post-
relocation activities in accordance with Section 28 of Republic Act No. 7279 (UDHA) and IRR;

(6) Monitor compliance with the balanced housing requirement under Republic Act No.
7279 (UDHA) and IRR;


(7) Coordinate with concemed agencies and the LGUs in the formulation, development and
implementation of an information system that will provide the government and the general
public with timely, accurate and reliable data on the underprivileged and homeless citizens;

(8) Administer, through the regional offices, homeless assistance advances/grants to LGUs
and NGOs and private communities for temporary and emergency housing, as well as building
renovation, improvements, in coordination with the Department of Social Welfare and
Development (DSWD);

(9) Administer the amortization support component of the Abot-Kaya Pabahay Fund, and
other similar funds;

(10) Institute measures such as but not limited to the setting up of an LGUcled Anti-
Squatting Task Force to detect and thwart squatting and to address such other concomitant
problems as rural-to-urban migration;

(11) Monitor the implementation of projects and programs under it

(12) Perform such other related functions as may be assigned to it by the Secretary.

SEC. 13. Services. — The Department shall have the following services: (a) Planning and
Management Service (b) Administrative and Financial Service, and (c) Legal Service.

‘The services shall perform the following functions:

(a) Planning and Management Service —

(1) Formulate, update and ensure the implementation of an integrated national housing and
urban development framework that will provide policy directives, guidelines, strategies and
support mechanisms for active multi-sectoral participation;

(2) Conduct continuing comprehensive studies and research on housing and urban
development necessary for policy and program review and formulation;

(3) Develop and provide legal, regulatory and supervisory frameworks that promote the
development of a sustainable market-oriented housing finance system to ensure the adequate
flow of private funds into the primary and secondary mortgage markets;

(4) Develop clearly defined, transparent and well-targeted housing subsidy mechanisms to
enhance access by low-income housing beneficiaries;

(8) Establish and maintain a management information system and sub-systems for
monitoring and evaluating Department-wide programs and projects, including those that are
executed by operating bureaus and offices;

(6) Manage and maintain a housing and urban development data bank to include a shelter
indicator system, beneficiary profile, and other national database on shelter and urban
development;

(7) Formulate policies, plans and procedures for data control and systems management;

(8) Act as the central repository of existing and future computer files;

(9) Maintain and operate the Department's library; and


(10) Establish and maintain a viable information network with other government agencies
and instrumentalities.

(b) Administrative and Financial Service —

(1) Provide the Department with economical, efficient and effective services relating to
personnel, communication, procurement, supplies, equipment, transportation services,
collections, disbursement, security, and property management;

(2) Conduct in-house training; and

(3) Provide disbursement, budgeting, accounting, comptrollership and internal audit service
to the Department.

(c) Legal Service -

(1) Conduct research on such matters brought before the Department’s attention by
interested parties and offices seeking legal advice, opinion and assistance;

(2) Recommend the issuance of opinions and the adoption of policies, rules and regulations
based on the foregoing;

(3) Draft, recommend and review proposed legislative measures;

(4) Prepare and maintain an index, compilation, annotation and digest of laws, rules,
regulations, commission and court decisions relevant to the Department’s mandates;

(5) Review proposed contracts and/or agreements of the Department to ensure their
consistency with existing laws, rules and regulations;

(6) As Special Counsels duly deputized by the Office of the Solicitor General (OSG),
represent the Department in court for the purpose of defending the official acts of its officers and
employees that were regularly and diligently performed in the course of the normal discharge of
their functions;

(7) Prepare pleadings and other legal documents and submit progress reports on the cases
handled by them;

(8) Attend and participate in congressional hearings and inter-agency meetings relative to
the formulation of legislative measures, proposed executive issuances, rules and regulations
and/or Memoranda of Agreement with other offices and agencies or the private sector; and

(9) Provide/extend legal advice assistance to other offices of the Department.

SEC. 14. Regional and Field Offices. - Consistent with the requirements of economy and
efficiency, there shall be established a Regional Office, which shal! be headed by a Regional
Director, in every administrative region and in as many field offices as are necessary: Provided,
That they are established in accordance with the regional pattern as prescribed by existing laws.

SEC. 15. Functions of the Regional Directors and Regional Offices. — While program

bureaus exercise technical supervision functions over regional counterparts, the Regional
Director shall be the responsible line official for all Department programs in the administrative
region. The Regional Director shall be appointed by the President and shall report to the
Secretary,


The Regional Office shall perform the following functions:

(a) Ensure that Department program-goals are met and that programs are implemented in
accordance with the duly adopted policies, standards and guidelines;

(b) Ensure the consistency between the overall regional development goals and programs
and the National Urban Development Strategy and between Department programs and regional
plans of other government agencies;

(©) Directly manage and implement Department programs in the immediate geographic
area;

(d) Direct and evaluate the performance of field offices in the region;

(e) Monitor, investigate and assess compliance with approved subdivision and
condominium plans, endorse and recommend the filing of appropriate charges for violations
thereof;

() Coordinate with the LGUs with regard to their local urban development, land use and
shelter plans, and provide the necessary technical assistance on devolved powers related to
housing and urban planning as mandated by the Local Government Code and other related laws;

(g) Administer the registration of homeowners’ associations and condominium
corporations;

(h) Undertake the issuance of certificates of registration and licenses to sell for
condominium and subdivision projects, and collect fees for the purpose;

(Advise and coordinate the plans and programs of the Regional and Field Offices of the
attached agencies and corporations; and

(j) Perform such other functions as may be provided for by law and by the Secretary.

SEC. 16. Functions of Field Directors and Offices. — A Field Director shall head a Field
Office and shall be accountable to the Regional Director. The Field Officer shall directly
administer Department programs in his/her jurisdictional area and shall ensure their proper
implementation.

The field direotor shall maximize his/her detail in the areas under jurisdiction by closely
coordinating with the local planning officer, the pertinent sanggunian committee, the Urban Poor
Affairs Office (UPAO), and the local housing boards, if any, for program monitoring,
implementation and enforcement.

SEC. 17.Relationship Among the Regional and Field Offices of the Department, its
Attached Agencies and Corporations, and the LGUs. ~ The relationship among the Regional and
Field Offices of the Department, its attached agencies and corporations, and the LGUs, shall be
purely coordinative.

CHAPTER Ill
ATTACHED AGENCIES AND CORPORATIONS

SEC. 18. Attached Corporations and Agencies and their Functions. — Any provision of law

or their respective charters to the contrary notwithstanding, the following corporations and


agencies are hereby attached to the Department for general supervision, and policy and program
coordination. They shall continue to operate and function in accordance with their respective
charters, laws or orders creating them insofar as they are not inconsistent with this Act:

(a) Home Guaranty Corporation (HGC);

(b) National Housing Authority (NHA);

(c) National Home Mortgage Finance Corporation (NHMFC);

(d) Home Development Mutual Fund (HDMF), and

(©) Housing and Land Use Regulatory Board (HLURB), hereby renamed the Housing and
Urban Development Adjudication Commission (HUDAC).

‘Any and all exemptions from the compensation and position classification provided for
under Republic Act No. 6758, otherwise known as the “Compensation and Position
Classification Act of 1989” which were previously granted to any and all of the abovementioned
attached agencies and corporations, are hereby withdrawn.

Any provision of law or the respective charters of the abovementioned corporations and
agencies to the contrary notwithstanding, the Secretary shall, in a concurrent capacity, be the ex
officio Chairman of the respective boards of HGC, NHA, NHMFC and HDMF.

SEC. 19. Reconstitution of the Governing Bodies of Attached Corporations and Agencies. —
‘The governing bodies of the corporations and agency attached to the Department are hereby
reconstituted as follows, any provision of law or their respective charters to the contrary
notwithstanding:

(a) Home Guaranty Corporation (HGC). The Board of Directors of the HGC shall be
composed of the Secretary as ex officio chairman, the Secretary of Finance as vice chairman, and
the following as members: the President of the HGC, the Director-General of the NEDA, and
three (3) others to be appointed by the President of the Philippines, who shall serve for a term of
five (5) years: Provided, That the person appointed shall be of good moral character, of
unquestionable integrity, of known probity and patriotism, and with expertise and experience of
at least ten (10) years in business, finance, and in their professions: Provided, further, That in the
event of a vacancy, the successor appointed to fill the said vacancy shall serve only the
unexpired portion of the term of the member he succeeds.

(b) National Housing Authority (NHA). The Board of Directors of the NHA shall be
composed of the Secretary as chairman, the General Manager of the Authority as vice chairman,
and the following as members: the Secretary of the Department of the Interior and Local
Government (DILG), the Chairman of the National Anti-Poverty Commission, the Chief
Executive Officer of the NHMFC and two (2) others to be appointed by the President of the
Philippines, one of whom shall represent the real estate and housing industry and the other shall
represent the NGOs or POs.

(c) National Home Mortgage Finance Corporation (NHMFC). The Board of Directors of
the NHMFC shall be composed of the Secretary as chairman, the Chief Executive Officer of the


NHMFC as vice chairman, and the following as members: the Administrator of the SSS, the
General Manager of the GSIS, the Chief Executive Officer of the HDMF, and two (2) others to
be appointed by the President of the Philippines, one of whom shall represent the real estate and
housifig industry and the other shall represent the NGOs or POs.

(d) Home Development Mutual Fund (HDMF). The Board of Trustees of the HDMF shall
bé.composed of the Secretary as chairman, the Secretary of the Department of Finance (DOF) as
“vice chairman, and the following as members: the Secretary of the Department of Budget and

” Management (DBM), the Secretary of the Department of Labor and Employment (DOLE), the
Chief Executive Officer of the HDMF, two (2) representatives of private employees, two (2)
representatives of private employers, one (1) representative of government employees, and one
(1) representative of the real estate and housing industry.

The representatives of the priva:- employers and employees shall each be appointed by the
President for a term of two (2) years: Provided, however, That of the first set to be appointed,
one (1) representative of the employees «suid one (1) representative of the employers shall have a
term of only one (1) year. The representatives of the goverament employees and the real estate
and housing industry shall be appointed by the President for a term of two (2) years.

CHAPTER IV
REAL ESTATE ADJUDICATION COMMISSION

SEC. 20. Renaming the Housing and Land Use Regulatory Board (HLURB). — The
HLURB is hereby renamed and reconstituted as the Housing and Urban Development
Commission (HUDAC), which shall be attached to the Department for program and policy
coordination and administrative supervision.

The regulatory functions of the former HLURB shall be performed by the Department with
the HUDAC retaining the quasi-judicial functions thereof.

The Commission shall be composed of a chairman and eight (8) full-time members to be
appointed by the President, majority of whom shall be members of the Philippine Bar while the
others shall have a background or experience in urban development planning, management,
architecture, civil engineering or other related fields. The chairman shall have the rank of a
Commission Chairman [V while the commissioners shall each have the rank of a Commission
Member IV. They must have been engaged in the practice of their respective professions or
specialization or employed in an appropriate office for a period of at least five (5) years. In
addition, no person who has been convicted of a crime involving moral turpitude shall be
appointed as a chairman or a member of the Commission.

The incumbent full-time commissioners of the present HLURB shall remain in office
unless they opt to avail of the retirement and separation benefits provided in Section 38 of this
Act or are sooner removed for cause.

Upon expiration of their terms, they shall be entitled to retire under existing laws, if they

are so qualified to retire thereunder, or to receive a compulsory retirement gratuity equivalent to


the total of two (2) times their basic salary as commissioner, for every year of service, whichever
is higher.

The Commission may sit en banc or in three (3) divisions, each composed of three (3)
members. The Commission shall sit en banc only for purposes of promulgating rules and
regulations governing the hearing and disposition of cases before any of its divisions and
regional branches, hearing and disposition of motions for reconsideration and formulating
policies affecting its administration and operations. The Commission shall exercise its
jons: Provided, That the

commission sitting em banc may, on temporary or emergency basis, allow cases within the

adjudicatory and all other powers, functions and duties through its div

jurisdiction of any division to be heard and decided by any other division whose docket allows
the additional workload and such transfer will not expose litigants to unnecessary additional
expense.

‘The concurrence of two (2) commissioners of a division shall be necessary for the
pronouncement of judgment or resolution. Whenever the required membership in a division is
not complete and the concurrence of two (2) commissioners to arrive at a judgment or resolution
cannot be obtained, the chairman shall designate such number of additional commissioners from
the other divisions as may be necessary.

The conclusions of a division on any case submitted to it for decision shall be reached in
consultation before the case is assigned to a member for the writing of the decision. It shall be
mandatory for the division to meet for purposes of the consultation ordained herein, A

jon shall be issued

certification to this effect signed by the presiding commissioner of the di
and a copy thereof attached to the record of the case and served upon parties.

The Commission, when sitting en banc shall be assisted by the executive clerk and, when
acting through its divisions, by the division executive clerks in the performance of such similar
or equivalent functions and duties as are discharged by the Clerk of Court and Deputy Clerks of
Court of the Court of Appeals.

SEC. 21. Term and Compensation. — The members of the HUDAC shalll be appointed for a
term of six (6) years without reappointment. Appointment to any vacancy shall be only for the
unexpired term of the predecessor and shall receive the same salaries and emoluments of a
Commissioner of the National Labor Relations Commission (NLRC).

SEC. 22. Power and Authority of the Commission. —In the exercise of its judicial functions,
the HUDAC shall be governed by the principles of justice, equity and faimess. It shall act as an
impartial and independent tribunal and shall render judgment in accordance with law, evidence
and merit of the case. In particular, the HUDAC shall have the following powers and authorities:

(a) Promulgate rules and regulations governing the hearing and disposition of cases filed
before it and those pertaining to its internal functions and such other regulations as may be
necessary to carry out the purposes of this Act: Provided, That it shall not be bound by technical
rules of procedure but shall proceed to hear and decide all cases, disputes or controversies in a


most expeditious manner, employing all reasonable means to ascertain the facts of every case
including conducting clarificatory hearing, if necessary, in accordance with justice, equity and
merit;

(b) Exercise exclusive appellate jurisdiction over all cases decided by the housing and
urban development arbiters. However, the Secretary may assume jurisdiction over any complaint
or case and decide the same or certify such case for decision by the Commission if, in his
opinion, he believes that the controversy involves massive fraud or unsound business practices or
critical socioeconomic or environmental considerations that has serious potential impact on the
interests of the sector of the general welfare;

(c) Administer oaths, summon the parties to a controversy, issue subpoenas requiring
attendance and testimony of witnesses or the production of such books, papers, contracts,
records, agreements, and other documents of similar nature as may be material to a just
determination of the matter under investigation or hearing conducted in pursuance under this
Act;

(d) Issue cease and desist orders, preliminary or permanent injunctions, whether
prohibitory or mandatory, in all cases in which it has jurisdiction, and in which the pertinent
provisions of the rules of civil procedure shall apply;

(e) Hold any person in contempt, directly or indirectly, and impose appropriate penalties
therefor;

(0) Impose administrative fines and/or penalties for violation of this Act, Republic Act No.
7279, and other laws implemented by the HUDAC, including pertinent rules and regulations,
orders, decisions and rulings: Provided, That the maximum imposable. fines or penalties shall
not exceed Five hundred thousand pesos (P500,000);

(g) To establish offices to cover as many provinces and cities, whenever and wherever it
may be expedient, necessary and feasible;

(h) Deputize any law enforcement agency in the execution of its final orders, rulings or
decisions;

(i) Directly utilize income generated from fees, fines, charges and other collections in the
performance of its functions to defray operating expenses and provide allowances for its

personnel;

(j) Issue writs, orders to execute demolition, or seizure or closure of property in
accordance with its decision; and

(k) Exercise such other powers as implied, necessary or incidental to the carrying out the
express powers granted to the HUDAC or to achieve the objectives and purposes of this Act, and
other laws implemented by the Commission.
‘The Chairman, aided by the Executive Clerk Court IV shall have administrative

supervision over the Commission and its regional branches and all its personnel including the

Housing and Urban Development Arbiters.


SEC. 23. Jurisdiction of the Housing and Urban Development Arbiters. - The Housing and
Urban Development Arbiters shall have original and exclusive jurisdiction to hear and decide
cases of the following nature:

(a) On Real Estate —

(1) Unsound and fraudulent real estate business practices;

(2) Claims for refund against project owners, developers, dealers, brokers or salespersons;

(3) Specific performance of contractual and statutory obligations filed by buyers of
subdivision lots or condominium units against the owner, developer, dealer, broker or
salesperson;

(4) Squatting on subdivision lots;

(5) Disputes involving buyer-financing agreements with any financing institution for
condominiunvsubdivision projects;

(6) Easements or rights of way affecting or involving subdivision and condominium
projects;

(7) Disputes between: (i) landowners and developers, and (ii) banks and developers,
whenever the interest of buyers of subdivision lots, or house and lots, or condominium units are
involved;

(8) Partial redemption and release of mortgage titles of subdivision lots and condominium
units;

(9) Disputes involving easements of waterways, drainage, connections to public utilities,
and light and view affecting subdivision and condominium projects;

(10) Disputes involving homeowners’ associations and condominium corporations, whether
intra-corporate or inter-corporate;

{11)Claims of brokers and/or salespersons for unpaid commissions for sales of
condominium and/or subdivision projects and all other real estate brokerage transactions;

(12) Disputes between lessors and lessees affecting subdivision and condominium units;

(13) Cases filed by subdivision or condominium owners or developers and mortgage
financing institutions against lot or unit buyers for collection of unpaid amortization; and

(14) Other related cases arising from contractual or statutory obligations of owners, dealers,
brokers or salespersons towards lot or unit buyers.

(b) On Housing and Land Use Planning and Regulation

Complaints in areas without local zoning administrators and/or local zoning boards of
appeals involving: (i) opposition to any land use or development project; and (ii) petitions for
recall or revocation of the grant by a local government official of any zoning or locational
clearance permit, both on the ground that the same is violative of land use planning laws and/or
zoning ordinances.”

(c) On Shelter Rights —


SEC. 23. Jurisdiction of the Housing and Urban Development Arbiters. - The Housing and
Urban Development Arbiters shall have original and exclusive jurisdiction to hear and decide
cases of the following nature:

(a) On Real Estate —

(1) Unsound and fraudulent real estate business practices;

(2) Claims for refund against project owners, developers, dealers, brokers or salespersons;

(3) Specific performance of contractual and statutory obligations filed by buyers of
subdivision lots or condominium units against the owner, developer, dealer, broker or
salesperson;

(4) Squatting on subdivision lots;

(5) Disputes involving buyer-financing agreements with any financing institution for
condominium/subdivision projects;

(6) Easements or rights of way affecting or involving subdivision and condominium
projects;

(7) Disputes between: (i) landowners and developers, and (ii) banks and developers,
whenever the interest of buyers of subdivision lots, or house and lots, or condominium units are
involved;

(8) Partial redemption and release of mortgage titles of subdivision lots and condominium
units;

(9) Disputes involving easements of waterways, drainage, connections to public utilities,
and light and view affecting subdivision and condominium projects;

(10) Disputes involving homeowners’ associations and condominium corporations, whether
intra-corporate or inter-corporate;

(11) Claims of brokers and/or salespersons for unpaid commissions for sales of
condominium and/or subdivision projects and all other real estate brokerage transactions;

(12) Disputes between lessors and lessees affecting subdivision and condominium units;

(13) Cases filed by subdivision or condominium owners or developers and mortgage
financing institutions against lot or unit buyers for collection of unpaid amortizations; and

(14) Other related cases arising from contractual or statutory obligations of owners, dealers,
brokers or salespersons towards lot or unit buyers.

(b) On Housing and Land Use Planning and Regulation

Complaints in areas without local zoning administrators and/or local zoning boards of
appeals involving: (i) opposition to any land use or development project; and (ii) petitions for
recall or revocation of the grant by a local government official of any zoning or locational
clearance permit, both on the ground that the same is violative of land use planning laws and/or
zoning ordinances.”

(c) On Shelter Rights —


(1) Violations of the provisions of the Urban Development and Housing Act (Republic
Act No. 7279), including but not limited to the following:

(1.1) Just and humane eviction/demolition procedure under Section 28 and pertinent
implementing rules and regulations;

(1.2) Prohibition against professional squatters and squatting syndicates under Section
27 and pertinent implementing rules and regulations;

(1.3) Inventory of lands under Section 7 and pertinent implementing rules and
regulations;

(1.4) Identification of sites for socialized housing under Section 8 and pertinent
implementing rules and regulations;

(1.5) Limitations on the disposition of land for socialized housing under Section 14 and
pertinent implementing rules and regulations;

(1.6) Registration of socialized housing beneficiaries under Section 17 and pertinent
implementing rules and regulations; and

(1.7) Balanced housing development under Section 18 and pertinent rules and
regulations.

(2) All ejectment cases where the party defendants are underprivileged and homeless
citizens as defined by the UDHA (Republic Act No. 7279) or a duly registered association
whose members are underprivileged and homeless citizens as defined by the UDHA (Republic
Act No. 7279).

‘SEC. 24. Criminal Prosecution. — Criminal prosecution for violation of housing laws and
regulations shall be instituted before regular courts with appropriate jurisdiction.

SEC. 25, Housing and Urban Development Arbiters, Qualifications and Compensation. -
The Secretary, upon recommendation of the chairman of the Commission, shall appoint housing
and urban development arbiter as the needs of the service may require for each administrative
region. No person shall be appointed housing and urban development arbiters unless he has been
a member of the Philippine Bar for at least five (5) years with at least two (2) years experience or
exposure in the field of housing, real estate and/or land use planning and zoning.

The Housing and Urban Development Arbiters shall receive an annual salary and be
entitled to the allowances and benefits equivalent to the salaries, allowances and benefits of labor
arbiters of the National Labor Relations Commission.

SEC. 26. Sheriff. - The Commission shall appoint a sheriff or such number of sheriffs in its
central and regional branches. No person shall be appointed to the position of sheriff unless he is
a second grade civil service eligible and has finished at least two (2) years of college. The
sheriff shall be responsible for the service or execution of all writs, summons and orders and
other process of the Commission.

SEC. 27. Appearances. — A lawyer appearing for a party is presumed to be properly
authorized for that purpose. A non-lawyer may appear before the HUDAC or the Housing Urban


Development Arbiter only if: (a) he/she represents himself/herself as party to the case; ot (b)
he/she represents an organization: Provided, That he/she shall be made to present written proof
that he/she is properly authorized.

SEC. 28. Appeals. — Decisions, awards or orders of the Housing Urban Development
Arbiter shall be final and executory unless appealed to the HUDAC within ten (10) calendar days
from receipt of such decisions, awards or orders.

Decisions of the Commission shall be appealable only to the Court of Appeals by way of a
petition for review within fifteen (15) days from notice of judgment, award or order, pursuant to
Rule 43 of the 1997 Rules of Civil Procedure

SEC. 29. Prohibition Against Restraining Order or Injunction. — No court of the
Philippines except the Supreme Court and Court of Appeals shall have jurisdiction to issue any
restraining order or writ of preliminary or permanent injunction against the HUDAC or its
regional offices in any case, dispute or controversy arising ftom, necessary to, or in connection
with the application, implementation, enforcement or interpretation of this Act and other
pertinent laws on housing and eviction/demolition procedures.

SEC. 30. Pending Cases, - All cases pending in court not within the original and exclusive
jurisdiction of the former HLURB as defined under Presidential Decree No. 957 as amended by
Executive Order No. 648 shall continue to be heard, tried and decided into their finality:
Provided, That enforcement of decisions in pending ejectment cases which eventually violate
Section 28 of Republic Act No. 7279 may be subjected to the original and exclusive jurisdiction
of the HUDAC.

CHAPTER V
PUBLIC ESTATES AUTHORITY

SEC. 31. Public Estates Authority (PEA). ~ In addition to the existing mandate of the PEA
created under Presidential Decree No. 1084, as amended by Executive Order No. 525, (series of
1979) and Executive Order No. 654 (series of 1981), the PEA is hereby mandated to ensure that
its programs and projects are in accordance with the broader objective of the national urban
development and housing framework. In coordination with the Department, the PEA shall
undertake the development of new towns with complete basic facilities in urbanizable and
urbanizing areas including growth areas to decongest existing urban communities.

The governing board of the PEA is hereby reconstituted to include the Secretary of the
Department of Housing and Urban Development and the Secretary of the DILG as ex officio
members.

CHAPTER VI
SHELTER FINANCE

SEC. 32. Housing Assistance for HDMF, SSS and GSIS Members. — As provided for in

their respective charters, the HDMEF, SSS and GSIS shall allocate annually funds to implement

home lending and housing assistance programs which qualified members of these institutions


may avail of. For this purpose, the HDMF, SSS and GSIS shall provide annually the maximum
limit of their investible funds for their housing programs. Any provision to the contrary
notwithstanding, the integrity and character of the funds of the SSS, GSIS and HDMF for the
benefit of its members shall not be prejudiced.

The funds allocated shall be used exclusively for home financing and no part thereof shall
be used for administrative or operating expenses of these institutions.

New members of the HDMF shall be allowed to pay the required two (2)-year membership
contribution in lump sum to immediately qualify for home lending and housing assistance
programs.

Within thirty (30) days from the effectivity of this Act, the HDMF, SSS and GSIS shall
jointly formulate the policies and specific terms that will govern implementation of their
respective facilities for Retail Loan and Development Loan Programs. The same guidelines shall
be adopted by government and private financial institutions implementing retail and
developmental home financing programs.

SEC. 33. Social Housing Fund, — There is hereby established a Social Housing Fund (SHF)
composed of the following fund sources:

(a) Amounts provided for socialized housing under the annual General Appropriations Act;

(b) Fifty percent (50%) of the twelve percent (12%) of all the proceeds of any sale, after
deducting all expenses related to the sale, portions of military camps as provided in Republic Act
No. 7227, as amended;

(©) Loans, grants, bequests and donations, whether from local or foreign sources;

(d) Proceeds ftom forfeited customs bonds; and

(e) Ten percent (10%) of the mandatory annual contributions of the Philippine Charity
Sweepstakes Office (PCSO) to the charity fund as provided for in Section 6 of Republic Act No.
1169 shall be channeled to this fund.

In addition, Sixty-five billion pesos (P65,000,000,000.00) from the unused portion of the
Agri-Agra funds of banks to be accessed over a period of four (4) years from the effectivity of
this Act shall be invested in low-cost and socialized housing.

The SHF shall be administered by the Department and shall be allocated solely for housing
programs for the low-income group of the informal sector such as squatter relocation, sites and
services program, urban renewal, rental housing, land banking and livelihood assistance
programs in resettlement areas, The programs and projects that will be funded under said fund
and the implementing bureau or agency shall be determined by the Department.

CHAPTER VIL
TRANSITORY PROVISIONS

SEC. 34. Transfer of Powers and Functions. ~ Within six (6) months after the approval of
this Act, the powers and functions of the Housing and Urban Development Coordinating Council
(HUDCC) shall be transferred to the Department. The foregoing transfer of powers and functions


shall include all applicable funds and appropriations, records, equipment, property and personnel
as may be necessary. The same shall apply to agencies and government units which have not
been abolished but whose functions have been transferred to the Department except the assets,
pertinent funds, records, property, equipment and personnel of the HLURB needed for
adjudicatory and related support functions. All purely governmental functions being performed
by the HLURB shall be transferred to the Department. Likewise, all existing powers and
functions of these agencies in their charters which are inherent and incidental to their corporate
mandates shall be retained with the concemed agencies.

Alll ex officio functions of the Chairman of the HUDCC are likewise transferred to the
Secretary.

SEC. 35. Transfer of Rights, Assets and Liabilities. - The Department shall, by virtue of
this Act, be subrogated to all rights and assume all the liabilities of the HUDCC and all other
agencies, or government units whose functions and powers have been transferred to the
Department, and all their funds, records, property, assets, equipment and such personnel, as may
be necessary, including unexpended appropriations and/or allocations except the assets, pertinent
funds, records, property, equipment and personnel of the HLURB needed for adjudicatory and
related support functions. All contracts and liabilities of the said offices are hereby transferred to.
and assumed by the Department and shall be acted upon in accordance with the Auditing Code
and other pertinent laws, rules and regulations: Provided, That existing officers and employees
of said agencies/corporations, shall continue to assume their posts in holdover capacity until their
new appointments are issued.

SEC. 36. Rationalization or Transfer of Functions of Attached or Related Agencies. ~ The
land use planning and enforcement functions including monitoring and issuance of licenses and

permits of the HLURB as provided for under Sections 5a, 5b, Sc, Sd, 5g and Sh of Executive

Order No. 648 and similar provisions in Executive Order No. 90; the implementation of the pre-
relocation and post-relocation activities mentioned in Section 12 (¢) 4 of this Act, as provided for
in Section 28 of Republic Act No. 7279; and the powers, authorities and responsibilities vested
in the HLURB with respect to the registration of homeowners’ associations as provided for under
Section 26 of Republic Act No. 8763 shall be transferred to the Department.

SEC. 37.Siructure and Staffing Pattern, — Except for the position of Secretary,
Undersecretary and Assistant Secretary, there shall be no hiring of new personnel for the
Department. Within ninety (90) days from the effectivity of this Act, the Secretary shall
formulate and submit to the Oversight Committee for its review and approval the Department's
proposed organizational structure and staffing pattern that shall ensure that there is no
duplication of functions between the Department and its attached agencies. After the Oversight’s
review and approval, the proposed organizational structure and staffing pattem of the
Department shall be submitted to the President for final approval through the DBM within ninety
(90) days.


The Oversight Committee shall be composed of the following:

(a) The Chairpersons of the Senate Committee on Housing, Resettlement and Urban
Planning, and the House Committee on Government Reorganization, as co-Chairpersons; and

(b) The Chairpersons of the Senate Committee on Finance and the House Committee on
Housing and Urban Development, the House Committee on Government Enterprises and
Privatization, and the House Committee on Appropriations, as members,

‘The authorized positions created therein shall be filled by regular appointment by the
President or the Secretary, as the case may be: Provided, That in the filling of positions created,
the Secretary shall create an ad hoc committee composed of management and staff of the
concemed agencies to ensure that preference shall be given to the personnel of the corporations
or agencies affected by the restructuring provided in this Act: Provided, further, That such
individuals comply with the qualification standards set by the Civil Service Commission (CSC)
for the positions they shall be appointed to: Provided, finally, That if such individuals possess
the same qualifications, seniority shall be given priority.

SEC. 38. Separation from the Service. — Employees separated and/or phased-out from the
service as a result of the abolition and/or reorganization under the provisions of this Act shall
within six (6) months from their separation and/or phase-out from the service receive a
separation pay equivalent to two (2) times the monthly basic salary for every year of service in
the government and the refund of their personal contribution plus interest including the
government share to the GSIS. In addition, those who are qualified to retire shall be allowed to
retire and be entitled to all benefits provided, under any of the existing retirement laws. The
miscellaneous personnel benefits, the organization adjustment, and corporate funds may be used
to fund the purpose.

CHAPTER VIII
FUNDING

SEC. 39. Appropriations. — The amount needed for the initial implementation of this Act
shall be charged against the current year’s appropriations of HUDCC and all corporations herein
attached to the Department. Thereafter, such sums as may be necessary for the continued
implementation of this Act shall be included in the annual General Appropriations Act.

SEC. 40. Additional Funding. — Subject to existing rules and regulations, the funds and
monies collected or which otherwise come into possession of the Department and its bureaus
from fees, surcharges, fines and penalties which the Department and its bureaus may impose and
collect under this Act, as well as an amount to be determined at the beginning of every calendar
year representing twenty percent (20%) of the outstanding balance of the funds and monies shall
be deposited as a special account in the General Fund and shall be disbursed for expenses
necessary for the effective discharge of the powers and functions of the Department under this
Act, except personal services requirements.

CHAPTER IX


MISCELLANEOUS AND FINAL PROVISIONS

SEC. 41. Social Housing One-Stop Processing Centers. - For purposes of socialized, low-
cost, economic and middle-income housing development, the Department shall establish Social
Housing One-Stop Processing Centers (SHOPCs) in the regions, which shall centralize the
processing and issuance of all required permits, clearances and licenses: Provided, That for the
foregoing purpose, the respective ceilings for socialized, low cost/economic and middle-income
housing shall be jointly determined by the Department and the NEDA: Provided, further, That
at any time, but not more often than once every two (2) years, such ceilings may be reviewed or
revised to conform to prevailing economic conditions. All agencies involved in the issuance of
said permits, clearances and licenses shall be represented in the SHOPC and shall assign to
SHOPC regional centers personnel who shall be sufficiently authorized to process and issue the
same.

SEC. 42. Identification and Designation of Lands for Housing and Urban Development. ~
The Department of Housing and Urban Development (DHUD), the Department of Agrarian
Reform (DAR) and the Department of Agriculture (DA) shall, within ninety (90) days from
effectivity of this Act, jointly identify agricultural lands which under Republic Act No. 6657,

otherwise known as the Comprehensive Agrarian Reform Law, and other existing laws, rules and
regulations are already exempted from conversion requirements and which can be devoted for
housing and urban development purposes: Provided, That the list shall exclude lands that are
declared as non-negotiable for or protected from conversion under existing laws and issuances
and those lands covered under Republic Act No. 6657: Provided, further, That the designation
of lands for housing and urban development purposes shall neither prejudice the rights of
qualified beneficiaries under Republic Act No. 6657 nor undermine the protected agricultural
areas intended to ensure the attainment of food security under Republic Act No. 8435, otherwise
known as the Agriculture and Fisheries Modernization Act (AFMA) and other existing laws:
Provided, finally, That in the case of lands exempted from conversion and those whose
application for conversion has been approved by the DAR, the applicant shall be allowed to
proceed with any horizontal or vertical development without need for any prior clearance or
approval from the DAR or the DA consistent with the terms of the approved order of conversion.

SEC. 43. Creation of an Advisory Committee. - The Department, within thirty (30) days
from the effectivity of this Act, an advisory committee consisting of key representatives from the
urban poor organizations and other marginalized groups, nongovernment organizations,
academe, private sector, local government, the Presidential Commission for the Urban Poor
(PCUP), and national government agencies shall be created to provide a forum for broader sector
participation and dialogue on key housing and urban development issues and policies. The
representatives of the urban poor and other marginalized groups shall be selected by their
respective National Anti-Poverty Commission (NAPC) sectoral councils.


SEC. 44. Disclosure and Divestment of Financial Interest. — Before assumption into office,
the Secretary, the Undersecretaries and the Assistant Secretaries shall submit to the CSC a list of
all companies, partnerships or business enterprises, including non-profit organizations, in which
they or any immediate member of their families within the second degree of consanguinity or
affinity, have any form of financial interest or employment relationship, including consultancy:
Provided, however, That all other forms of employment relationship held by the heads of the
Offices of the Department shall be immediately terminated upon assumption into office.

Within thirty (30) days thereafter, complete divestment of financial interests in any
institution, form or company, which falls under the supervisory or regulatory jurisdiction of the
Department shall be made: Provided, however, That in cases where confirmation of
appointments by the Commission on Appointments is required, the divestment, mandated herein
shall be complied within thirty (30) days after such confirmation.

The divestment provided in the preceding paragraph shall likewise apply to the members or
the immediate members of their families within the second degree of consanguinity having
interest in any institution or activity which falls under the regulatory jurisdiction and supervision
of the Department and the attached agencies and corporations.

SEC. 45. Relationship with Other Government Departments. — The Department and its
priority projects shall enjoy preferential attention from the DENR, DAR, DA, Department of
Justice and the LGUs, relative to the issuance of necessary permits and licenses necessary for the
implementation of housing and urban development programs and projects.

Upon request of the Department or any of its bureaus, all government agencies with
functions relative to the approval of the projects of the Departments or its duly authorized and
endorsed entities, whether government or private, shall act upon and resolve the matter within
ten (10) working calendar days. Toward this end, the Secretary with the approval of the
President may establish an inter-agency Secretariat for the purpose of expediting the approval of
said projects.

SEC. 46. Mandatory Review Two (2) Years Afier the Enactment of this Act. — The
Department shall review the charters and mandates of attached agencies and corporations and
recommend the necessary legislation to ensure consistency with the policy of this Act and avoid
duplication of functions or any other dysfunction among the attached agencies and corporations.

SEC. 47. Formulation of the Implementing Rules and Regulations — Within three (3)
months after the approval of this Act, the President shall convene an Inter-Agency Committee
that shall formulate and issue the appropriate rules and regulations necessary for the efficient and
effective implementation of any and all provisions of this Act, including applicable existing
housing laws, formation of homeowners association to manage subdivision and condominium
projects and availment of loans on terms easily affordable to all.

The Inter-Agency Committee shall be composed of the following:

(a) The Secretary of the DHUD, as chairman;


(b) The Secretaries of the DOF, DILG, DAR and DENR;

(c) The heads of the GSIS, SSS, NHA, NHMFC, REAC, HDMF and HGC;

(d) The Chairpersons of the Senate Committees on Finance and Housing, Resettlement and
Urban Planning; and the House Committees on Government Reorganization, Housing and Urban
Development, Government Enterprises and Privatization, and Appropriations;

(e) Two (2) representatives each from the dominant urban poor organization and NGOs, to
be appointed by the Chairpersons of Joint Congressional Committee; and

(®) Two (2) representatives each from the respective organizations of real estate brokers,
real estate appraisers and real estate consultants.

SEC. 48. Penal Provision. — The Department shall impose a maximum imposable fine for
violations of its standards, rules and regulations should not exceed Five hundred thousand pesos
(P500,000.00): Provided, That said limit shall be accordingly adjusted by the Secretary, and
such adjustment shall be reflective, but not exceed the annual rate of increase of the Consumer
Price Index: Provided, further, That the Secretary may adjust such rates not more than once
every three (3) years.

SEC. 49. Separability Clause. - If, for any reason or reasons, any part or provision of this
‘Act shall be held to be unconstitutional or invalid, other parts or provisions hereof which are not
affected thereby shall continue to be in full force and effect.

SEC. 50. Repealing Clause. — Provisions of laws, decrees, orders, proclamations, rules,
regulations or parts thereof which are inconsistent herewith are hereby repealed, amended or
modified accordingly.

SEC. 51. Effectivity. - This Act shall take effect fifteen (15) days following its complete

publication in at least two (2) national newspapers of general circulation.

Approved,