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HOUSE OF REPRESENTATIVES
RECEIVED
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RERSTR TION UNIT
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Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City, Metro Manila

Seventeenth Congress
First Regular Session

House Bill No.__2.5'7 _

Introduced by Honorable Roy M. Loyola

EXPLANATORY NOTE

This bill was originally filed during the Second Regular Session of the
Fifteenth Congress. It was approved by the House and transmitted to the
Senate. Meanwhile, Hon. Panfilo M, Lacson introduced a parallel bill which was
referred to the Senate Committee on Local Government. Joint committee
hearings were conducted to deliberate upon the said bills,

The primordial reason for converting a municipality or cluster of
barangays into a city is to ensure its economic viability (Latasa v Commission
on Elections, G.R. No. 154829, December 10, 2003), As a general rule, the
creation of a local government unit or its conversion from one level into another
shall be based on verifiable indicators or viability and projected capacity to
provide services, specifically income, population and land area (Section 7, RA
No, 7160, Local Government Code of 1991).

Among the three, there is no doubt that the income requirement is the
most controlling. In recognition of such fact, the Code sets forth the following
criterion: Income — It must be sufficient, based on acceptable standards, to
provide for all essential facilities and services and special functions
commensurate with the size of its population, as expected of the local
government unit concerned (Section 7(a), supra).

With regards to the population requirement, the Code merely provides:
Population — It shall be determined as the total number of inhabitants, within
the territorial jurisdiction of the local government unit concerned (Section 7(b).
supra)

And lastly, with regards to the land area, the Code merely requires that
the same be contiguous; properly identified by metes and bounds; and more
importantly, must be sufficient to provide for such basic services and facilities to
meet the requirements of its populace (Section 7(c), supra)



As our law stands today, before a municipality or cluster of barangays
could be converted into a component city, it must have an annual income of at
least One Hundred Million Pesos (P100,000,000,00) and a territory of at least
‘one hundred (100) square kilometers or a population of not fess than one
hundred fifty thousand (150,000) Sec. 450, R.A. No. 7160, Local Government
Code, as amended by R.A. 9006).

However, there are some municipalities which, despite of its small land
area or population, have nevertheless demonstrated its unquestionable
capacity to provide essential government facilities, social services to lis
inhabitants, comparable or even superior to existing cities.

As we all know, living in a city has its corresponding economic
advantage. Thus, it would be utterly unfair to the inhabitants of municipalities to
forever foreclose their right to the benefits of cityhood simply because such
municipalities’ land area and population is less than one hundred (100) square
kilometers or one hundred fifty thousand (150,000), respectively.

While there is no hard and fast rule to determine the optimum populace
or land area for a city, applying the principles of political law for creation of a
sovereign state, the population must be numerous enough and able to
procreate in order to ensure perpetuation of the political entity. With regards to
its land area, the same must be large enough to be able to sufficiently provided
for its people.

Noteworthy are the small states, specifically: Monaco, a tiny state along
the French Riviera which has an area of just 0.7 square miles (1.81 sq. km.)
and a population of just 32,000, The island state of Naura, became
independent in 1968, and has an area of just 8.5 square miles (22 sq. km.) and
population of just 13,000. Tuvalu, formerly known as Ellice Islands, gained its
independence in1978, and has an area of just 9 square miles (23.3 sq. km.)
and a population of 12,000. San Merino, located at Mt. Titano in north central
Italy, which has an area of just 24 square miles (62.13 sq. km.) and a
Population of just 29, 000.

If the above political entities have attained their status as an
independent state despite its small population and land area, all the more
reason for municipalities which have time and again demonstrated their
capacity to thrive despite their small population and land area to be allowed to
upgrade its status to that of a city.

Just like in any other law, there is a general rule and there is an
exception. For purposes of this bill, the general rule remains — that for creation
of or conversion into a city, a municipality must have an income of at least
P100,000,000.00 and a land area of at least 100 square kilometers of
population of at least 150,000. The exception is that, if the municipality
generates a local income of at least double than that of the general rule, that is.
Two Hundred Twenty Million Pesos (P200,000,000.00), then it is qualified to be
converted into a city without regard to the size of its land area or population


In view thereof, support and approval of this measure is earnestly
sought

YY M. LOYOLA


Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City, Metro Manila

Seventeenth Congress
First Regular Session

257

House Bill No.

Introduced by Honorable Roy M. Loyola

AN ACT EXEMPTING FROM THE POPULATION AND THE LAND AREA
REQUIREMENTS THE CONVERSION OF A MUNICIPALITY INTO A
COMPONENT CITY IF IT HAS A LOCALLY GENERATED AVERAGE
ANNUAL INCOME OF AT LEAST TWO HUNDRED FIFTY MILLION
PESOS (P250,000,000.00), AMENDING FOR
THE PURPOSE SECTION 450 OF REPUBLIC ACT NO. 7160,
AS AMENDED BY REPUBLIC ACT NO. 9009, OTHERWISE KNOWN AS
THE LOCAL GOVERNMENT CODE OF 1991

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

1 SECTION 1. Section 450 of Republic Act No. 7160 as amended,
2 otherwise known as the Local Government Code of 1991, as amended by
3 Republic Act No. 9009, is hereby further amended to read as follows:

4“ SEC. 450. Requisites for Creation — (a) A municipality or a cluster of
5 barangays may be converted into a component city if it has a locally
6 generated average annual income, as certified by the Department of Finance,
7 of at least One hundred million pesos (P100,000,000.00) for the last two (2)
8 consecutive years based on 2012 constant prices, provided, that:

9 (i) @ contiguous territory of at least one hundred (100) square
10 kilometers, as certified by the Lands Management Bureau; or

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

12 inhabitants, as certified by the National Statistics Office.


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“PROVIDED, FURTHER, THAT THE REQUIREMENT ON
POPULATION AND ON LAND AREA PRESCRIBED HEREIN
SHALL NOT APPLY _IF_A_MUNICIPALIT A
CLUSTER OF BARANGAYS HAS A LOCALLY GENERATED
AVERAGE ANNUAL INCOME, AS CERTIFIED BY THE
DEPARTMENT OF FINANCE, OF AT LEAST TWO HUNDRED
FIFTY MILLION PESOS (P250,000,000.00) FOR THE LAST
TWO (2) CONSECUTIVE YEARS BASED ON 2012
CONSTANT PRICES AND HAS EITHER THE

TION OR___LAND_ AREA REQUIREMENT.
PRESCRIBED FOR THE CREATION OF A MUNICIPALITY
UNDER SECTION 442 OF THIS CODE . PROVIDED,
FURTHERMORE, THAT THREE (3) YEARS AFTER THE
EFFECTIVITY OF THIS ACT AND EVERY THREE (3) YEARS
THEREAFTER, THE THRESHOLD AMOUNT OF TWO
HUNDERED FIETY MILLION. PESOS
(P_250, 000, 000.00) SHALL BE INCREASED BY FIVE
PERCENT (5%).”

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

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

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

SECTION 2. If any provision of this Act shall be declared invalid or
unconstitutional, the remaining part or provisions not otherwise affected shall
remain in force.

SECTION 3. Any law, decreed, ordinance, administrative circulars not
consistent with any provision of this Act is hereby amended, repealed or
modified accordingly

SECTION 4. This Act shall take effect fifteen (15) days after its
complete publication in the Official Gazette or in at least two (2) newspapers
of general circulation.

Approved,