SIXTEENTH CONGRESS OF THE 
REPUBLIC OF THE PHILIPPINES 
First Regular 5ession 
SENATE 
680 
S.B.No. __ _ 
Introduced by Senator LOREN LEGARDA 
EXPLANATORY NOTE 
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Lake Lanao and its watersheds'are now in the middle of an ecological crisis. A 
2006 study made by the Mindanao State University found that the Lake suffers' 
from. massive algae contamination brought about by indiscriminate logging, 
extensive lami-use and farming. These findings further raise the alarm on the 
lake's, situation following earlier reports that around 90 percent of, its endemic 
freshwater species are already extinct due to the introduction of foreign species 
in the lake and the construction of hydro-electric power 1:l1ants in the area, which 
disturbed the watershed's ecological balance. Widespread illegal logging in its 
watersheds has also affected the Lake's ability to supply water to the Agus River 
which serves as its only outlet and supports six hydroelectric powerplants. 
Tl;te ' Lake's continued deterioration is most unfortunate given its historical, 
cultural, economic and ecological importanceto<the country. Known as one of 
'the wqrld's 17 ancient lakes and the country's largest freshwater lake, Lake 
Lanao is found in the province of Lanao del Sur w1Uch is part of the Autonomous 
Region in Muslim Mindanao (ARMM). Being the only ancient lake in the 
Philippines, Lake Lanao is considered of prime ecological importance which 
justified the establishment of the Lake Lanao Watershed way back in 1992 
pursuant to Presidential Proclamation No. 871. 
Considered as part of their 
ancestral domain, Lake Lanao is also of significant historical and cultural 
importance to indigenous, peoples, particularly the Mi\ranao peoples who 
continue to live in areas surrounding the lake. More importantly, it plays an 
important role in securing Mindanao's energy needs as it supplies water for six 
of its existing hydroelectric powerplants, collectively responsible for 70 percent 
of the island's, energy needs. 
Though the·poor state of the Lake is attributed to·mancmade activity, this was 
further compounded by'the absence of a clear framework in managing its water 
and watershed resources. Following its declaration as a Watershed Area in 1992, 
Lake Lanao was first managed by the DepC\rtment of Environment and Natural 
Resources. With the issuance of Memorandum Order (MO) No. 421-1992, further 
amended by MO No. 242- 2007 however, management of the Lake Lanao 
Watershed was transferred to the Lake. Lanao Watershed Protection and, 
Development Council (LLWPDC) which was chaired by the Secretary of the 
Department of Environment and Natural Resources (DENR) and the President of 
the National Power Corporation (NPC) as Vice- Chair. Other council members 
include the regional governor of the ARMM, the provincial governors of Lanao 
del Norte and Lanao del Sur, and the mayor of Marawi City. Apart from the 
LLWPDC, other agencies also exercise administrative functions over the lake and 


its watersheds such as the NPC and the DENR. Further complicating matters is 
its location within the ARMM which naturally places it within the management 
of the regional government. And yet, due to its status as a Protected Watershed 
area, jurisdiction was transferred to the national government. 
The bill seeks to establish an effective policy and regulatory administration over 
Lake Lanao thru the Lake Lanao Development Authority, thereby ensuring the 
promotion and development of Mindanao's important natural resource base in a 
sustainable manner.. The salient provisions are as follows: 
(a) Granting the Lake Lanao Development . Authority the exclusive 
jurisdiction to issue Environmental Compliance Certificates (ECCs)/ 
Certificate of Non Coverage (CNCs) required under PreSidential Decree 
No. 1586 and grant permits for any projects or activities in or affecting the 
Lake Lanao Area; 
(b) Adopting the integrated water resources management to promote 
sustainable development in the Area; 
(c) Creating the Public Hearing Committee to strengthen Lake Lanao 
Development Authority's ability to resolve disputes; 
(d) Mandating the National Police Commission to create the Lanao Lake 
Police exclusively for the Lake Lmao· Area, trained· especially for 
I 
enforcement of fisheries and environmental laws and the rules and 
regulations duly promulgated by the Lake Lanao Development Authority. 
In view of the foregoing, the passage of this bill is earnestly sought. 
~~> 
L 
GARDA 
Senator 


SIXTEENTH CONGRESS OF THE 
REPUBLIC OF THE PHILIPPINES 
First Regular Session 
SENATE 
Sl'tlZlh\ 
tQthft of tltl! ,~~rrrptMl! 
'13 
JUL -9 A 9 :26 
____________________ 
S_.B_._N_O. __ 6_.8_'_O ________ ~RF_;t_"f_:l_V_E!_)_g_y:~~ 
Intrqduced by Senator LOREN LEGARDA 
AN ACT 
ESTABLISHING THE LAKE LANAO DEVELOPMENT AUTHORITY, DEFINING 
ITS POWERS, FUNCTIONS AND DUTIES, APPROPRIATING FUNDS THEREFOR 
AND 'FOR OTHER PURPOSES 
Be it enacted by the Senate and the House of Representatives of the Philippines in the 
Congress assembled: 
1 
SECTION 1. Title. - This Act shalI be known as the "Lake Lanao Development 
2 
Act of 2013". 
~ 
3 
SEC. 2. Declaration of Policy - It is hereby declared the policy of the State to 
4 
promote. and develop Lake Lanao in a sustainable manner'along with the surrounding 
5 
areas that comprise its region, hereinafter referred to as the Lake Lanao Area, with Lake 
6 
Lanao as its focal point whose water resources must be systematicalIy managed and 
7 
protected for various uses. 
8 
For this purpose, the State adopts an integrated water resources' management 
9 
approach, using' the lake's' watersheds! sub-watersheds as .planning units to 
10 .' interconnect and integrate its various ecosystems pursuant to Art. II, .Sec. 16 of the 1987 
11 
ConStitution: "The State shalI protect and advance the right of the people to a balanced 
12 
and healthful ecology in accord with the rhythm and harmony of nature." 
13 
In accordance with the integrated water resources management approach, an)\ 
14 
development program in the region shalI always be undertaken with due regard to 
15 
suitable environmental .management and. the prevention' of undue ecological 
16 
disturbances, resource deterioration and pollution with the end in view of enabling the 
17 
lake to safeguard its historical, cultural, economic and spiritual importance among the 
18 
communities living in its environs, and to realize its full potentials, including among 
19 
other uses as a major resource in power generation. 
20 
SEC. 3. Lake Lanao Area- For purposes of this Act, the Lake Lanao Area, 
21 
hereinafter referred to as the Area, shalI primarily comprise all the cities, towns or 
22 
municipalities within Lanao del Sur. Provided, that any new province, city, town or 
23 
municipality created in the future out of the aforementioned province, city, town or 
24 
municipality that are critical in ensuring effective conservation and management of 
25 
Lanao Lake shall form part of the Lake Lanao Area. Provide<;l., further, that the Lanao 
26 
Lake Development Authority, upon consultation and approval, of the National Water 
27 
Resources Board (NWRB) and the Department of Environment and Natural Resources 
28 
(DENR), may include nearby rivers and watersheds which are deemed critical for the 
29 
conservation of the Lake Lanao Watershed. 
1 


1 
SEC. 4. Creation of the Lake Lanao Development Authority. - To effectively 
2 
carry out the declared policy, there is hereby created under the Office of the 'President 
3 
of the Philippines, a body corporate to be known as the Lake Lanao Development 
4 
Authority hereinafter referred to as the Authority, which shall pursue enviro.nment 
5 
friendly development of the Area. It shall have exclusive jurisdiction to issue 
6 
Environmental Compliance Certificates (ECCs)! Certificates of Non Coverage (CNCs) 
7 
required under Presidential Decree No. 1586 and grant permits for any projects or 
8 
activities in or affecting the Area including, but not limited to, industrial and 
9 
commercial activities, navigation, irrigation, power generation, housing, resettlement 
10 
and other forms of land developments, construction and operation of fishpens! 
11 
fishcages, aquaculture development, reclamation, and similar or related activities. 
12 
SEC. 5. Powers and Functions. - The Authority shall have the following 
13 
purposes and functions: 
14 
(a) Make a comprehensive survey of the Lake Lanaci Area, including its socio-
15 
economic conditions, lake water quality, irrigation, water supply, transport 
16 
route, reservoir of floodwater, hydroelectric power supply, scenic and tourist 
, 
17 
spots, state of its watersheds, the tributary rivers and other physical and natural 
18 ' 
resurce potentials, and on the basis thereof, to craft a comprehensive and 
19 
detailed Lake Ul.nao Development Plan tCl promote its sustainable development; 
20 
Provided, that, the Authority shall prepare ,the plan in consultation with other 
21 
stakeholders of Lake Lanao including, but not limited to, representatives of 
22 
indigenous peoples, agricultural, commercial, industrial users, hydrology 
23 
experts, the academe, civil society organizations active in conservation of Lake 
24 
Lanao, and local government units; Provided, further, that, the implementation 
25 
'of all plans and programs of the Authority shall require prior consultation with 
26 
the National Economic and Development Authority (NEDA), the Mindanao 
27 
Development Authority (MinDA), and the NWRB to ensure that such plans and 
I 
28 
programs are consistent with natiop.al plans and programs; 
29 
(b) Pass upon and approve all plans, programs and projects proposed by local 
30 
government units, pUblic corporations and private entities that are related to the 
31 
utilization of the resources anel the development of Lake Lanao and the Area, 
32 
and monitor the proper'implementation of said plans, programs and projects, 
33 
consistent with the objectives and purposes of this Act. With mandatory prior 
34 
consultation .with the DENR, the Authority shall issue the necessary permit for 
35 
approved plans, programs and projects, Provided, That, any application for 
36 
permit that has been disapproved by the Authority may be appealed to the 
37 
Office of the President within fifteen (15) days from receipt of such disapproval, 
38 
whose decision shall be final; 
39 
(c) Harness and promote private participatiol,1 in business ventures in terms of 
40 
capital . expenditures, 'land, expertise, financing and their facilities for the 
41 
development and growth of the Area; 
42 
(d) Plan, program, finance and! or undertake infrastructUre projects. such as river, 
43 
flood and tide control works, waster water and sewerage works, water supply, 
44 
roads, pot works, irrigation, housing and related works when so required within 
45 
the context of its development plans and programs, including the readjustment; 
46 
relocation or restoration, or resettlement. of population, as may be deemed I 
47 
necessary and beneficial by the Authority: Provided, That, should any project be 
2 


1 
financed wholly or in part by the Autho.rity, it is hereby authorized to collect 
2 
reasonable fees and tolls as may be fixed by its Board of Directors from users 
3 
and/ or beneficiaries thereof to recover costs of construction, operation and 
4 
maintenance of the projects: Provided, Further, That if the Authority should find 
5 
it necessary to undertake such infrastructure project as social overhead capital 
6 
projects, the Authority shall be authorized to receive financial assistance from the 
7 
government and foreign donors, subject to such terms and conditions that may 
8 
be imposed by the Government; 
9 
(e) Reclaim or cause to be reclaimed portions of Lake Lanao or undertake 
10 
reclamation projects and/or acquire such bodies of land from the Lake which 
11 
may be necessary to accomplish the aims and purposes of the Authority; 
12 
Provided, That, the land so reclaimed shall be the property of the Authority and 
13 
title thereto shall be vested in the Authority: Provided, further, That the resulting 
14 
lakeshore area shall continue to be owned by the National Government; 
15 
(f) Establish research centers to undertake studies on the marine and other natural 
16 
resources of Lake Lanao for policy or plan formulation and project 
17 
implementation; 
18 
(g) Exercise surface and groundwater rights within the Area; 
19 
(h) Exercise exclusive jurisdiction to issue, renew, or deny permits for the use of the 
20 
lake waters for any projects, including navigation, construction, operation of fish 
21 
pens, fish enclosures, fish corral and the like, and to impose necessary safeguard 
22 
for lake quality control and management and to collect necessary fees for said 
23 
activities and projects: Provided, That, the Authority's Board may determine new 
24 
areas of fishery development or activities, taking into account the over-all 
25 
development plans and programs for Lake Lanao: Provided, further, that the 
26 
Authority shall, subject to the approval of the President of the Philippines, 
27 
promulgate such rules and regulations which shall govern fisheries development 
28 
activities in Lake Lanao, including the advisability of placing the supervision 'of 
29 
said activities under the Bureau of Fisheries and Aquatic Resources of the local 
30 
government units in the Area; 
31 
(i) Issue orders or decisions, after notice and hearing, to ensure compliance with the 
32 
provisions of this Act and its implementing rules and regulations; 
33 
G) After due notice and hearing, revoke, suspend or modify any permit issued 
34 
under this Act whenever the same is necessary to prevent or abate pollution; 
35 
(k) Deputize in writing, or request assistance of, appropriate government agencies 
36 
or instrumentalities for the purpose of enforcing this Act and its implementing 
37 
rules and regulations and the orders and decisions of the Authority; 
38 
(I) Impose administrative fines of not less than Fifty Thousand Pesos (PhP 50,000.00) 
39 
and other penalties it may deem reasonable and appropriate for non-compliance 
40 
with permit conditions and for undertaking development without clearance from 
41 
the Authority against any person juridical or otherwise within the Area who may 
42 
be found violating, or have in fact violated, any of its rules and regulations; 
3 


1· 
The Authority is likewise hereby authorized to institute the necessary legal 
2 
proceedings against those who shall commence to implement any project, plan or 
3 
program within the Area not cleared and approved by the Authority; 
4 
(m) . Require the cities and municipalities embraced within the area to pass 
5 
appropriate zoning ordinances and regulatory measures to carry out the 
6 
objectives of the Authority and to enforce the same with the assistance of the 
7 
Authority; 
8 
(n) A\:!thorize its bonafide representatives at all reasonable times to enter any pUblif 
9 
property .and private property devoted to industrial, manufacturing, pracessing, 
10 
·or commercial use for the purpose of inspecting and investigating conditions 
11 
related to pollution or possible or imminent pollution; 
, 
12 
(0) Promulgate and establish, in coordination with the DENR a~d other existing 
13 
government agencies, water quality standards for industrial, agricultural and 
14 
municipal waste discharges into the Lake and to ensure the cooperation of said 
15 
existing agencies of the Government in enforcing such standards; 
:).6 
(p) Undertake studies on the improvement and maintenance of the desirable water 
17 
quality of Lake Lanao, and in pursuance thereof, prepare a water quality 
18 
management program on a continuing basis, which the Authority shall carry out 
19 
with the assistance and support of the. national and loca] government units 
20 
involved in water quality management; 
21 
(q) Monitor water quality not only in the Lake proper but also in its major tributary 
22 
rivers; 
23 
(r) Conduct activities that promote the cultural, economic, environmental, and 
24 
historical importance of Lake Lanao in the overall. development of the Area and 
25 
of Mindanao among the communities living within the Area, emphasizing a 
26 
multi-stakeholder approach in conserving the Lake; and 
27 
(s) Exercise such powers and peform such other functions as may be necessary to 
28 
.carry out its duties and responsibilities under this Act. 
29 
Sec; 6. Corporate Powers. - The Authority shall exercise the following powers 
30 
and functions: 
31 
a: Sue and be sued in its corporate name; 
32 
b. Adopt and use a corporate seal with judicial. notice; 
33 
c. Undertake the programs and projects specified in Section 4 hereof; 
34 
d. Engage in agricultural, industrial and commercial or other activities necessary 
35 
or directly contributory to the socio-economic development of the Area, and, for 
'.36 
this purpose, whether by itself or in cooperation with private entities, to 
37 
organize, finance, invest in, and operate subsidiary 'corporations: Provided, That, 
38 
the Authority shall engage only, unless public interest reqUires otherwise, ~n 
39 
those activities as are in the nature of new ventures or are clearly beyond the 
40 
. scope, capacity or interest of private enterprises; 
41 
e. Invest in or· otherwise acquire, own, hold, use, operate, sell, assign, transfer, . 
42 
exchange, mortgage, pledge, lease, develop or otherwise deal in, real property of 
43 
every kind and description, including shares of stock, bonds, debentures, notes, 
44 
evidence of indebtedness, and other securities; 
4 


1· 
f. Exercise·the right of eminent domain or acquire by purchase, privately owned 
2 
. land within the area for purposes of implementing projects of the Authority; 
3 
g. Borrow.funds from any local or foreign fin~ncial institutions independent of 
4 . 
the bonds it may issue to carry out the purposes of the authority; 
5 
h. Acquire, lease, or own such property or assets in whatever form and serve as 
6 
the custodian of such properties or assets, real or movable, and sell or otherwise 
7 
dispose of the same as the Authority may deem it necessary in the pursuit of its 
8 
aims, objectives and purposes; 
9 
i. Lend or facilitate the extension of financial assistance and/ or act as surety or 
10 
guarantor to worthwhile agricultural, industrial and commercial enterprises; 
11 
j .. Accept grants, donations, gifts, bequests, funds and/or properties in whatever 
12 
form and whatever source in coordination with the appropriate agency and 
13 
administer the same in accordance with the terms thereof, or in the absence of 
14 
any condition, in such manner consis,tent with the policy, aims and objectives of 
15 
the Authority provided for in this Act; 
16 
k. Enter into a contract of any kind and description to enable it to carry out its 
17 
purposes and objectives; 
18 
L . Issue such rules and regulations as may be necessary to effectively carry out 
19 
the powers and purposes herein provided,. including plans, programs and 
20 
projects of the Authority, the same to take effect thirty (30) days after publication 
21 
thereof, in a newspaper of general circulation; and 
22 
m. For the purposes of attainir)g or in furtherance qf any of its objectives,. to 
23 
perform any and' all acts which a corporation, co-partnership, or natural person 
24 
is authorized to perform under the laws existing or which may be enacted 
25 
hereafter. 
I 
26 
. Sec. 7. Board of Directors. - The corporate powers and functions of the 
27 
Authority shall bevested in and exercised by a Board of Directors, hereinafter referred 
28 
to as the Board, which shall be composed of the following: 
29 
30 
(1) Secretary of Environment and Natural Resources, Chairman 
31 
(2) General Manager, LanaQ Lake Development Authority, Vice- Chairman 
32 
(3) Secretary of Energy 
33 
(4) Regional Governor, Autonomous Region'in Muslim Mindanao 
34 
(5) Governor, Lanao del Sur 
35 
(6) Governor, Lanao del Norte 
36 
(7) Mayor, Marawi City 
. 
37 
(8) Representative, Hydroelectric powerplant owners 
38 
(9) Representative, Mindanao State University' 
39 
(10) 
Representative, Indigenous Peoples 
40 
(11) 
Representative, Civil Society Organization. 
41 
All representatives, to be appointed by the President of the Republic of the Philippines, 
42 
shall serve for a term of three (3) years, unless sooner removed from or is incapacitated 
43 
to perform functions of the office; Provided, further, that, representatives have Widely 
44 
known expertise and/or track record in the sector they appointed to represent in the 
45 
Board. 
46 
47 
SEC. 8. Powers and Functions of the Board. - The Board of Directors shall 
48 
exercise the following powers and functions: . 
49 
(a) Prescribe rules and regulations to govern the conduct of business of the 
50' 
Authority; 
5 


1 
(b) Approve the Authority's organizational structure and corresponding staffing 
2 
pattern; 
3 
(c) 'Fix the compensation of all officials from department heads, and others of 
4 
comparable rank including two (2) Assistant General Managers upon the 
5 
recommendation of the General Manager; 
I 
6 
(d) By' a majority vote of all members of the Board, suspend, remove or otherwise 
7 
discipline for just cause all officials appointed by the Board; 
8(e)' Approve the annual working program and budget of the Authority; 
9 
,(f) Perform such other acts and functions as may be necessary to carry out the 
10 
pro.visions of this Act; 
11 
SEC. 9. Po.wer to. Incur Debts and to Issue Bonds. - Whenever the Board of 
, 
, 
12 
Directors may deem it necessary for the Authority to incur an indebtedness or to issue 
13 
,bonds to carry out the provisions of this Act, it shall, by resolution, so declare and state 
14 
the purposes for which the proposed debt is to be incurred. The resolution shall be 
15 
passed by the affirmative vote of at least six (6) members of the Board and approved by 
16 
the President of the Philippines upon the recommendation of the Secretary 'of Finance in 
17 
consultation with the National Economic Development Authority (NED A) and the 
18 
Monetary Board. 
, i 
19 
SEC 10. Board Meetings. - The Board shall meet preferably at its principal office 
20 
at least, once ,a month and as frequently ,as necessary to discharge its duties and 
21 
responsibilities properly. The Board shall be convened by the Chairman or upon the 
22 
written request of a majority of its members. Except when otherwise provided for in 
23 
this Act, the vote of a majority of the members constituting a quorum shall be sufficient 
24 
for the adoption of any rule, resolution, decision or any act of the Board. 
25 
SEC. 11. Quo.rum. - The presence of six (6) members of the Board, including the 
26 
Chairman or' Vice-chairman, shall constitute a _ quorum for the transaction of the 
27 
business of the, Board. 
28 
SEC. 12. Per Diems and AIIo.wances. - The members of the Board shall receive a 
29 
per diem of Two Thousand Five Hundred Pesos (PhP 2,500.00) for every meeting but in 
30 
no case will the total amount received exceed the sum of ,Five Thousand Pesos (PhP 
31 
5,000.00).' Members of the Board shall be entitled to commutable transportation and 
32 
representation allowances in the performances'of official functions for the Authority the 
33 
aggregate amount of Five Thousand Pesos (Php 5,000.00) for anyone month. 
34 
SEC 13. Prohjbition against Conflict o.f Interest. - No member of the Board 
35 
shall be financi~lly interested, directly or indirectly, in any contract entered into by the 
36 
Authority or in any special privilege granted by the Authority during his term of office. 
37 
All contracts entered into in violation of the provision of this Section shall, by two thirds 
38 
(2/3) vote of the Board, automatically be disqualified from serving his unexpired term, . 
39 
and he shall furthermore be perpetually disqualified for membership in the said Board; 
40 
SEC 14. General Manager, Powers and Functio.ns. - The General Manager 
41 
shall be the chief executive of the Authority, as such, he or she shall have the following 
42 
powers and functions: ' 
43 
(a) Submit, 'for the consideration of the Board, the policies and measures which he or 
44 
she believes to be necessary to carry out the purposes and provisions of this Act; 
45 
(b) Execute and administer the policies, plans, programs and projects approved by 
46 
the Board; 
6 


1 
(C) Direct and supervise the operation and internal administration of the Authority. _ 
2 
The General Manager may delegate some of his or her administrative 
3 
responsibilities to other officers of the Authority subject to the rules and 
4 
regulations of the Board; 
5 
(d) Prepare the annual budget of the Authority for the consideration of the Board; 
6 
(e) Prepare the plantilla and appoint officials and employees below the rank of 
7 
division heads" to positions in the approved - budget upon written 
8 
recommendations of the division head concerned, using as a guide the standard 
9 
set forth and such other reports as may be required; 
10 
(f) Exercise such other powers as may be vested in him by the Board. 
11 
SEC 15. Representation of the Authority. - The General Manager shall be the 
12 
principal representative of the Authority. He shall be empowered, in such capacity and 
13 
in-accordance with the instructions of the Board: 
14 
(a) Represent the Authority in all dealings with other offices, agencies, and 
15 
instrumentalities of the Government and with all other persons and entities, 
16 
whether public or private domestic, foreign or international; 
17 
(h) Sign contr~cts concluded by the Authority, annual reports, balance sheets, profit 
18 
and loss statements, correspondences and other documents of fhe Authority; and 
19 
(c) Represent the Authority, either personally or through counsel, in any legal 
20 
proceedings or actions. 
- -
21 
SEC. 16. Tenure cif Office of the General Manager. - The General Manager shall 
22 
be appointed by the President of the Philippil;tes for a fixed term of six (6) years, unless 
23 
otherwise earlier removed from office for cause. In case of resignation, retirement, 
24 
separation, transfer, re-assignment, removal and other cause of cessation from office, 
25 
the replacement shall serve only for the unexpired portion of the-term. 
26 
SEC 17. Compensation. - The General Manager shall receive compensation 
27 
subject to the determination by the Board chargeable against the annual appropriation 
28 
_ of the Au~hority. The Board may provide him/her re;lsonable per diems and allowances 
29 
to supplement his basic salary. 
-
30 
SEC. 18. Departments. - There shall be created the following departments within 
31 
the authority: the Administrative, Corporate Legal Affairs, Finance, Policy Planning and 
32 
Management Services, Environmental Protection, Integrated Water Resources 
33 
Management Services, The head of each Department shall be appointed by the Board 
34 
upon recommendation of the General Manager, and shall receive an annual 
35 
compensation as may be fixed by the Board. 
36 
The Board- shall periodically review the appropriateness of the existing 
37 
organizational structUre and amend the same whenever it may deem necessary and 
38 
beneficial to achieve the purposes of this Act and to be able to respond efficiently and 
39 
effectively to the Authority's mandate as herein provided; 
_ 40 
SEC 19. Personnel. - The Board of Directors shall provide for an organization 
41 
and staff of officers and employees of Lal<e Lanao Development Authority and upon 
42 
recommendation of the General Manager, fix their renumerations and other 
43 
emoluments; All positions in the Authority 811all be governed by the compensation, 
44 
- position classification system and qualification standards approved by the General 
45 
Manager with the concurrence of the Board of DIrectors based on a comprehensive job 
46 
analysis of actual duties and responsibilities. 
7 


i 
The compensation plan shall be comparable wit):l the prevailing compensation 
2 
plans in the Philippine Economic Zone Authority (PEZA), the Bases Conversion 
3 
Development Authority (BCDA), the Clark Development Corporation (CDC) and the 
4 
private sector and shall be subject to the periodic review by the Board of Directors every 
5 
two (2) years, withQut prejudice to yearly merit reviews or increases based on 
6 
productivity and prOfitability. The Authority sharI be exempt from existing laws, rules 
7 
and regulations on compensation, position classification and qualification standard. It 
8 
,shall however endeavor to make its systems conform as closely as possible with the 
9 
principles under the Compensation and Position Classification Act of 1989 (RA No. 
10 
6758, as amended). 
11 
Employees and officers of the Authority including the appointed Members of the 
12 
Board, shall not engage directly or indirectly in partisan activities or take part in any 
13 
election, except to vote. 
14 
No officer or employee' of the Authority subject to civil service laws and 
15 
regulations shall be removed or suspended except for a cause, as provided by law. 
16 
SEC. 20. Auditing. - The auditing department shall be headed by the duly 
17 
appointed representative of the Commission on Atidit whose salary shall be determined 
18 
and paid according to law. All personnel of the auditing department shall be appointed, 
19 
and their number and salaries fixed by the Commission on Audit. 
20 
SEC. 21. Damages. - Compensation for any damage to, the water and aquatic 
21 
resources of Lake Lanao and its tributaries' resulting from failure to meet established 
,22, 
water and effluent quality standards or from such other wrongful act or omission of a 
23 
,person, private or public, juridical or otherwise, pUNishable under the law shall be 
24 
awarded to the Authority for water quality control and watershed management 
25 
projects. 
, 26 
SEC. 22. Annual Fees. - The Lake Lanao Development Authority is hereby 
27 
authorized to collect annual fees for the use of the lake waters and its tributaries for all 
28 
beneficial purposes including fisheries, aquaculture, municipal, industrial, agricultural 
29 
including irrigation, hydroelectric power generation, transport a~d navigation, waste 
30 
disposal purposes, and recreation among others. All the fees collected shall be 
31 
accordingly appropriated for the sustainable development of the lake and its watershed 
32 
areas. The Authority's collection of fees shall form part of its corporate funds and shall' 
33 
not be remitted to the National Treasury as' an exemption to the proviSions of 
34 
Presidential Decree No. 1234. 
' 
35 
SEC. 23. Capitalization. -.The Authority shall have an ~uthorized capital of Two 
36, 
Billion Pesos (PhP2,OOO,OOO,OOO) no par value shares, of which the amount of One 
37 
Billion Pesos (PhP1,OOO,OOO,OOO) shall be· subscribed by the province, cities, and 
38 
municipalities in the Area and at least twenty-five percent (25%) shall be subscribed by 
39 
the National Government.' 
40 
SEC. 24. Appropriations. - The sum of Fifty Million Pesos (PhP50,OOO,OOO) 
41 
necessary for the initial operating expenses of the Authority is hereby charged to the 
42 
appropriations authorized for the Regional Development Fund; Thereafter, the sum 
43 
necessary for the continued operation and maintenance of the Authority shall be 
44 
included ,in the annual budget of the Office of the President. , 
8 


1 
SEC. 25. Creation of a Public Hearing Committee.- For the purpose of 
2 
effectively carrying out the quasi-judicial powers of the Authority within the Lake 
3 
Lanao Watershed Area, a. Public Hearing Committee is hereby created composed of a 
4 
Chairman and two (2) other members to be designated by the General Manager. Any 
5 
decision, 'order or resolution must be concurred by the majority member of the 
6· 
Committee and duly approved by the General Manager. 
7 
SEC. 26. Creation of Lake Police Force. - The National Pblice Commission shall 
8 
constitute and assign a special police force, to be known as the Lake Lanao Police, 
9 
exclusively for 'the Lake Lanao Area, trair\ed especially for enforcement of 
10 
environmental and fisheries laws and the rules and regulations promUlgated by the 
11 
Lake Lanao Development Authority. 
12 
1;'he extent of operational supervision and control by the General Manager over 
13, 
the Lake Lanao Police shall be the same as that of loca,l chief executivE;$ over police force 
14 
of local government units (LGUs) as defined in the Department of Interior and Local 
.15 
Government (DILG) Act of 1990 (RA6975), in relation to Sec. 73 of the Local 
16 
Government Code of 1991 (RA .7160). 
17 
' SEC. 27. Exemption from Tax. - The Authority shall be exempt from payment of 
18 
all taxes imposed by the National Government, its provinces, cities, municipalities and 
19 
other government agencies and instrumentalities: Provided, That, its subsidiary 
20 
corporations shall be subject to all said taxes five (5) years after their establishment 
21 
under a graduated scale. Such exemption shall include any tax or fee imposed by the 
22 
Government on the sale, purchase or transfer of foreign exchange and all notes, bonds, 
23 
and debentures, and other obligations issued by the Authority, both as to the principal 
24' 
and interest. 
25 
SEC. 28. Penal and Civil Liability Clause. - Any person, natural or juridical, 
26 
who shall violate any of the provisions of this Act or any rules and regulations 
27 
promulgated by the Authority pursuant thereto shall be liable to imprisonment of not 
28 
exceeding three (3) years or to a fine not exceeding Fifty Thousand Pesos 
(PhP 
29 
,50,000.00) or both at the discretion of the court. This is wihout prejudice to the 
30 
imposition of penalties as may be provided under relevant and existing laws, rules, and 
31 
reguiations; Provided, that, for every two (2) years, periodic adjustments as 
32 
recommended by the National Statistics Office (NSO), shall be implemented to maintain 
33 
the deterrent function of the fine. 
34 
SEC. 29. Repealing Clause. - All republic acts,executive orders, rules and 
35 
regulations, and other issuances, or parts thereof, that are inconsistent with the 
36 
provisions of this Republic Act are hereby repealed or modified acwtdingly. 
37 
SEC. 30. Separability Clause. - If for any reason or reasons, any part or provision 
38 
of this Act shall be declared or held to be unconstitutional or invalid other parts or 
39 
provisions hereof, which are not affected thereby shall continue to be in full force and 
40 
effect. 
41 
SEC. 31. Effectivity. - This Act shall take effect fifteen (15) days following its 
42 
publication in at least two (2) national newspapers of general circulation. 
43 
Approved. 
44 
9