FIFTEENTH CONGRESS OF THE 
REPUBLIC OF THE PHILIPPINES 
Second Regular Session 
S EN A TE 
S.B.No. 3097 
Introduced by Senator LOREN B. LEGARDA 
EXPLANATORY NOTE 
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 contanimation brought about by indiscrimate logging, extensive land-use and 
farming. These findings further raise the alarm on the lake's situation following earlier 
reports that around 90 percent of its endemic fresh.water species are already extinct due 
to the introduction of foreign species in the lake and the construction of hydro-electric 
power plants 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. The National Grid Corporation of the Philippines estimated 
that low water levels in Lake Lanao and the Pulangi River back in 2010 cost the country 
PhP 62 billion in economic losses as the island suffered rotating brown outs that time. 
The Lake's continued deterioration is most unfortunate given its historical, cultural, 
economic and ecological importance to the country. Known as one of the world's 17 
ancient lakes and the country's largest freshwater lake, Lake Lanao is found in the 
province of Lanao del Sur which is part of the Autonomous Region of 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 Maranao 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 
hydroelech'ic powerplants, collectively responsible for 70 percent of the island's energy 
needs. 
Though the poor state of the Lake is attributed to man-made activity, this was further 
compounded by the absence of a clear framework in managing the its water and 
watershed resources. Following its declaration as a Watershed Area in 1992, Lake Lanao 
was first managed by the Department 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 DENR and the President of the National Power Corporation 
(NPC) as Vice- Chair. Other council members include the regional governor of the 
Autonomous Region of Muslim Mindanao (ARMM), the provincial governors of Lanao 
1 


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 provision of which 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 Lanao Area, trained especially for 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. 
~-q~~~~ 
LOREN B. LEGARDA 
2 


FIFTEENTH CONGRESS OF THE 
REPUBLIC OF THE PHILIPPINES 
Second Regular Session 
SENATE 
S. B. No. 3097 
Introduced by Senator Loren Legarda 
AN ACT 
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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: 
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SECTION 1. Title. - This Act shall be known as the "Lake Lanao Development 
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Authority of 2012". 
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SEC. 2. Declaration of Policy - It is hereby declared the policy of the State to 
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promote and develop Lake Lanao in a sustainable manner along with the surrounding 
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areas that comprise its region, hereinafter referred to as the Lake Lanao Area, with Lake 
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Lanao as its focal point whose water resources must be systematically managed and 
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protected for various uses. 
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For this purpose, the State adopts and integrated water resources management 
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approach, using the lake's watersheds/ sub- watersheds as planning units to 
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interconnect and integrate its various ecosystems pursuant to Art. II, Sec. 16 of the 1987 
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Constitution: "The State shall protect and advance the right of the people to a balanced 
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and healthful ecology in accord with the rhythm and harmony of nature." 
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In accordance with the integrated water resources management approach, any 
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development program in the region shall always be undertaken with due regard to 
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suitable environmental management and the prevention of undue ecological 
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disturbances, resource deterioration and pollution with the end in view of enabling the 
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lake to safeguard its historical, cultural, economic and spiritual importance among the 
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communities living in its environs, and to realize its full potentials, including among 
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other uses as a major resource in power generation. 
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SEC. 3. Lake Lanao Area- For purposes of this Act, the Lake Lanao Area, 
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hereinafter referred to as the Area, shall primarily comprise all the cities, towns or 
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municipalities within Lanao del Sur. Provided, that any new province, city, town or 
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municipality created in the future out of the aforementioned province, city, town or 
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municipality that are critical in ensuring effective conservation and management of 
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Lanao Lake shall form part of the Lake Lanao Area. Provided, further, that the Lanao 
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Lake Development Authority, upon consultation and approval, of the National Water 
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Resources Board (NWRB) and the Department of Environment and Natural Resources 
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(DENR), may include nearby rivers and watersheds, which are deemed critical for the 
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conservation of the Lake Lanao Watershed. 
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SEC. 4. Creation of the Lake Lanao Development Authority. - To effectively 
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carry out the declared policy, there is hereby created under the Office of the President 
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of the Philippines, a body corporate to be known as the Lake Lanao Development 
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Authority hereinafter referred to as the Authority, which shall pursue environment 
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friendly development of the Area. It shall have exclusive jurisdiction to issue 
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Environmental Compliance Certificates (ECCs)/ Certificates of Non Coverage (CNCs) 
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required under Presidential Decree No. 1586 and grant permits for any projects or 
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activities in or affecting the Area including, but not limited to, industrial and 
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commercial activities, navigation, irrigation, power generation, housing, resettlement 
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and other forms of land developments, construction and operation of fishpens/ 
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fishcages, aquaculture development, reclamation, and similar or related activities. 
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SEC. 5. Powers and Functions. - The Authority shall have the following 
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purposes and functions: 
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(a) Make a comprehensive survey of the Lake Lanao Area, including its socio-
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economic conditions, lake water quality, irrigation, water supply, transport 
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route, reservoir of floodwater, hydroelectric power supply, scenic and tourist 
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spots, state of its watersheds, the tributary rivers and other physical and natural 
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resurce potentials, and on the basis thereof, to craft a comprehensive and 
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detailed Lake Lanao Development Plan to promote its sustainable development; 
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Provided, that, the Authority shall prepare the plan in consultation with other 
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stakeholders of Lake Lanao including, but not limited to, representatives of 
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indigenous peoples, agricultural, commercial, industrial users, hydrology 
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experts, the academe, civil society organizations active in conservation of Lake 
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Lanao, and local government units; Provided, further, that, the implementation 
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of all plans and programs of the Authority shall require prior consultation with 
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the the National Economic and Development Authority (NEDA), the Mindanao 
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Development Authority (MinDA), and the NWRB to ensure that such plans and 
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programs are consistent with national plans and programs; 
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(b) Pass upon and approve all plans, programs and projects proposed by local 
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government units, public corporations and private entities that is related to the 
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utilization of the resources and the development of Lake Lanao and the Area, 
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and monitor the proper implementation of said plans, programs and projects, 
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consistent with the objectives and purposes of this Act. With mandatory prior 
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consultation with the DENR, the Authority shall issue the necessary permit for 
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approved plans, programs and projects, Provided, That, any application for 
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permit that has been disapproved by the Authority may be appealed to the 
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Office of the President within fifteen (15) days from receipt of such disapproval, 
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whose decision shall be final; 
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(c) Harness and promote private participation in business ventures in terms of 
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capital expenditures~ land, expertise, financing and their facilities for the 
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development and growth of the Area; 
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(d) Plan, program, finance and/ or undertake infrastructure projects such as river, 
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flood and tide control works, waster water and sewerage works, water supply, 
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roads, pot works, irrigation, housing and related works when so required within 
the context of its development plans and programs, including the readjustment; 
relocation or restoration, or resettlement of population, as may be deemed 
necessary and beneficial by the Authority: Provided, That, should any project be 
financed wholly or in part by the Authority, it is hereby authorized to collect 
reasonable fees and toIrs as may be fixed by its Board of Directors from users 
and/ or beneficiaries thereof to recover costs of construction, operation and 
maintenance of the projects: Provided, Further, That if the Authority should find 
it necessary to undertake such infrastructure project as social overhead capital 
projects, the Authority shall be authorized to receive financial assistance from the 
government and foreign donors, subject to such terms and conditions that may 
be imposed by the Government; 
(e) Reclaim or cause to be reclaimed portions of Lake Lanao or undertake 
reclamation projects and/ or acquire such bodies of land from the Lake which 
may be necessary to accomplish the aims and purposes of the Authority; 
Provided, That, the land so reclaimed shall be the property of the Authority and 
title thereto shall be vested in the Authority: Provided, further, That the resulting 
lakeshore area shall continue to be owned by the National Government; 
(f) Establish research centers to undertake studies on the marine and other natural 
resources of Lake Lanao for policy or plan formulation and project 
implementation; 
(g) Exercise surface and groundwater rights within the Area; 
(h) Exercise exclusive jurisdiction to issue, renew, or deny permits for the use of the 
lake waters for any projects, including navigation, construction, operation of fish 
pens, fish enclosures, fish corral and the like, and to impose necessary safeguard 
for lake quality control and management and to collect necessary fees for said 
activities and projects: Provided, That, the Authority's Board may determine new 
areas of fishery development or activities, taking into account the over-all 
development plans and programs for Lake Lanao: Provided, further, that the 
Authority shall, subject to the approval of the President of the Philippines, 
promulgate such rules and regulations which shall govern fisheries development 
activities in Lake Lanao, including the advisability of placing the supervision of 
said activities under the Bureau of Fisheries and Aquatic Resources of the local 
government units in the Area; 
(i) Issue orders or decisions, after notice and hearing, to insure compliance with the 
provisions of this Act and its implementing rules and regulations; 
0) After due notice and hearing, revoke, suspend or modify any permit issued 
under this Act whenever the same is necessary to prevent or abate pollution; 
(k) Deputize in writing, or request assistance of, appropriate govermnent agencies 
or instrumentalities for the purpose of enforcing this Act and its implementing 
rules and regulations and the orders and decisions of the Authority; 
(I) Impose administrative fines of not less than PhP 50,000.00 and other penalties it 
may deem reasonable and appropriate for non-compliance with permit 
conditions and for undertaking development without clearance from the 
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Authority against any person juridical or otherwise within the Area who may be 
found violating, or have in fact violated, any of its rules and regulations; 
The Authority is likewise hereby authorized to institute the necessary legal 
proceedings against those who shall commence to implement any project, plan or 
program within the Area not cleared and approved by the Authority; 
(m) 
Require the cities and municipalities embraced within the area to pass 
appropriate zoning ordinances and regulatory measures to carry out the 
objectives of the Authority and to enforce the same with the assistance of the 
Authority; 
(n) 
Authorize its bonafide representatives at all reasonable times to enter any 
public property and private property devoted to industrial, manufacturing, 
processing, or commercial use for the purpose of inspecting and investigating 
conditions related to pollution or possible or imminent pollution; 
(0) Promulgate and establish, in coordination with the DENR and other existing 
government agencies, water quality standards for industrial, agricultural and 
municipal waste discharges into the Lake and to ensure the cooperation of said 
existing agencies of the Government in enforcing such standards; 
(p) Undertake studies on the improvement and maintenance of the desirable water 
quality of Lake Lanao, and in pursuance thereof, prepare a water quality 
management program on a continuing basis, which the Authority shall carry out 
with the assistance and support of the national and local government units 
involved in water quality management; 
(q) Monitor water quality not only in the Lake proper but also in its major tributary 
rivers; 
(r) 
Conduct activities that promote the cultural, economic, environmental, and 
historical importance of Lake Lanao in the overall development of the Area and 
of Mindanao among the communities living within the Area, emphasizing a 
multi-stakeholder approach in conserving the Lake; and 
(s) 
Exercise such powers and peform such other functions as may be necessary to 
carry out its duties and responsibilities under this Act. 
Sec. 6. Corporate Powers. - The Authority shall exercise the following powers 
and functions: 
a. Sue and be sued in Its corporate name; 
b. Adopt and use a corporate seal with judicial notice; 
c. Undertake the programs and projects specified in Section 4 hereof; 
d. Engage in agricultural, industrial and commercial or other activities necessary 
or directly contributory to the socio-economic development of the Area, and, for 
this purpose, whether by itself or in cooperation with private entities, to 
organize, finance, invest in, and operate subsidiary corporations: Provided, That, 
the Authority shall engage only, unless public interest requires otherwise, in 
those activities as are in the nature of new ventures or are clearly beyond the 
scope, capacity or interest of private enterprises; 
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e. Invest in or otherwise acquire, own, hold, use, operate, sell, assign, transfer, 
2 
exchange, mortgage, pledge, lease, develop or otherwise deal in, real property of 
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every kind and description, including shares of stock, bonds, debentures, notes, 
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evidence of indebtedness, and other securities; 
5 
f. Exercise the right of eminent domain or acquire by purchase, privately owned 
6 
land within the area for purposes of implementing projects of the 
7 
Authority; 
8 
g. Borrow funds from any local or foreign financial institutions independent of 
9 
the bonds it may issue to carry out the purposes of the authority; 
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h. Acquire, lease, or own such property or assets in whatever form and serve as 
11 
the custodian of such properties or assets, real or movable, and sell or otherwise 
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dispose of the same as the Authority may deem it necessary in the pursuit of its 
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aims, objectives and purposes; 
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i. Lend or facilitate the extension of financial assistance andJ or act as surety or 
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guarantor to worthwhile agricultural, industrial and commercial enterprises; 
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j. Accept grants, donations, gifts, bequests, funds andJ or properties in whatever 
17 
form and whatever source in coordination with the appropriate agency and 
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administer the same in accordance with the terms thereof, or in the absence of 
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any condition, in such manner consistent with the policy, aims and objectives of 
20 
the Authority provided for in this Act; 
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k. Enter into a contract of any kind and description to enable it to carry out its 
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purposes and objectives; 
23 
1. Iss1.!e such rules and regulations as may be necessary to effectively carry out 
24 
the powers and purposes herein provided, including plans, programs and 
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projects of the Authority, the same to take effect thirty (30) days after publication 
26 
thereof, in a newspaper of general circulation; and 
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m. For the purposes of attaining or in furtherance of any of its objectives, to 
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perform any and all acts which a corporation, co-partnership, or natural person 
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is authorized to perform under the laws existing or which may be enacted 
30 
hereafter. 
31 
Sec. 7. Board of Directors. - The corporate powers and functions of the 
32 
Authmity shall be vested in and exercised by a Board of Directors, hereinafter referred 
33 
to as the Board, which shall be composed of the following: 
34 
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(1) Secretary of Environment and Natural Resources, Chairman 
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(2) General Manager, Lanao Lake Development Authority, Vice- Chairman 
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(3) Secretary of Energy 
38 
(4) Regional Governor, Autonomous Region of Muslim Mindanao 
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(5) Governor, Lanao del Sur 
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(6) Governor, Lanao del Norte 
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(7) Mayor, Marawi City 
42 
(8) Representative, Hydroelectric powerplant owners 
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(9) Representative, Mindanao State University 
44 
(10) 
Representative, Indigenous Peoples 
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(11) 
Representative, Civil Society Organization 
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All representatives, to be appointed by the President of the Republic of the Philippines, 
47 
shall serve for a term of three (3) years, unless sooner removed from or is incapacitated 
48 
to perform functions of the office; Provided, further, that, representatives have widely 
49 
known expertise andJ or track record in the sector they appointed to represent in the 
50 
Board; 
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SEC. 8. Powers and Functions of the Board. - The. Board of Directors shall 
exercise the following powers and functions: 
(a) Prescribe rules and regulations to govern the conduct of business of the 
Authority; 
(b) Approve the Authority's organizational structure and corresponding staffing 
pattern; 
(c) Fix the compensation of all officials from department heads, and others of 
comparable rank including two (2) Assistant General Managers upon the 
recommendation of the General Manager; 
(d) By a majority vote of all members of the Board, suspend, remove or otherwise 
discipline for just cause all officials appointed by the Board; 
(e) Approve the annual working program and budget of the Authority; 
(f) Perform such other acts and functions as may be necessary to carry out the 
provisions of this Act; 
SEC. 9. Power to Incur Debts and to Issue Bonds. - Whenever the Board of 
Directors may deem it necessary for the Authority to incur an indebtedness or to issue 
bonds to carry out the provisions of this Act, it shall, by resolution, so declare and state 
the purposes for which the proposed debt is to be incurred. The resolution shall be 
passed by the affirmative vote of at least six (6) members of the Board and approved by 
the President of the Philippines upon the recommendation of the Secretary of Finance in 
consultation with the National Economic Development Authority (NED A) and the 
Monetary Board. 
SEC. 10. Board Meetings. - The Board shall meet preferably at its principal office 
at least once a month and as frequently as necessary to discharge its duties and 
responsibilities properly. The Board shall be convened by the Chairman or upon the 
written request of a majority of its members. Except when otherwise provided for in 
this Act, the vote of a majority of the members constituting a quorum shall be sufficient 
for the adoption of any rule, resolution, decision or any act of the Board. 
Sec. 11. Quorum. - The presence of six (6) members of the Board, including the 
Chairman or Vice-chairman, shall constitute a quorum for the transaction of the 
business of the Board. 
SEC. 12. Per Diems and Allowances. - The members of the Board shall receive a 
per diem of PhP 2,500.00 for every meeting but in no case will the total amount received 
exceed the sum of PhP 5,000.00. Members of the Board shall be entitled to commutable 
transportation and representation allowances in the performances of official functions 
for the Authority the aggregate amount of Php 5,000.00 for anyone month. 
SEC. 13. Prohibition against Conflict of Interest. - No member of the Board 
shall be financially interested, directly or indirectly, in any contract entered into by the 
Authority or in any special privilege granted by the Authority during his term of office. 
All contracts entered into in violation of the provision of this Section shall, by two thirds 
(2/3) vote of the Board, automatically be disqualified from serving his unexpired term, 
and he shall furthermore be perpetually disqualified for membership in the said Board; 
SEC. 14. General Manager, Powers and Functions. - The General Manager 
shall be the chief executive of the Authority, as such, he or she shall have the follOWing 
powers and functions: 
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(a) Submit, for the consideration of the Board, the policies and measures which he or 
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she believes to be necessary to carry out the purposes and provisions of this Act; 
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. (b) Execute and administer the policies, plans, programs and projects approved by 
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the Board; 
5 
(c) Direct and supervise the operation and internal administration of the Authority. 
6 
The General Manager may delegate some of his or her administrative 
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responsibilities to other officers of the Authority subject to the rules and 
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regulations of the Board; 
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(d) Prepare the annual budget of the Authority for the consideration of the Board; 
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(e) Prepare the plantilla and appoint officials and employees below the rank of 
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division heads, to positions in the approved budget upon written 
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recommendations of the division head concerned, using as a guide the standard 
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set forth and such other reports as may be required; 
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(f) Exercise such other powers as may be vested in him by the Board. 
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SEC. 15. Representation of the Authority. - The General Manager shall be the 
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principal representative of the Authority. He shall be empowered, in such capacity and 
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in accordance with the instructions of the Board: 
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(a)Represent the Authority in all dealings with other offices, agencies, and 
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instrumentalities of the Government and with all other persons and entities, 
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whether public or private domestic, foreign or international; 
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(b) Sign contracts concluded by the Authority, annual reports, balance sheets, profit 
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and loss statements, correspondences and other documents of the Authority; and 
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(c) Represent the Authority, either personally or through counsel, in any legal 
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proceedings or actions. 
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SEC. 16. Tenure of Office of the General Manager. - The General Manager shall 
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be appointed by the President of the Philippines for a fixed term of six (6) years, unless 
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otherwise earlier removed from office for cause. In case of resignation, retirement, 
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separation, transfer, re-assignment, removal and other cause of cessation from office, 
29 
the replacement shall serve only for the unexpired portion of the term. 
30 
SEC. 17. Compensation. - The General Manager shall receive compensation 
31 
subject to the determination by the Board chargeable against the annual appropriation 
32 
of the Authority. The Board may provide him/her per diems and allowances to 
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supplement his basic salary. 
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SEC. 18. Departments. - There shall be created the following departments within 
35 
the authority: the Administrative, Corporate Legal Affairs, Finance, Policy Planning and 
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Management Services, 
Environmental Protection, Integrated Water Resources 
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Management Services, The head of each Department shall be appointed by the Board 
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upon recommendation of the General Manager, and shall receive an annual 
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compensation as may be fixed by the Board. 
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The Board shall periodically review the appropriateness of the existing 
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organizational structure and amend the same whenever it may deem necessary and 
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beneficial to achieve the purposes of this Act and to be able to respond efficiently and 
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effectively to th!" Authority's mandate as herein provided; 
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SEC. 19. Personnel. - The Board of Directors shall provide for an organization 
2 
and staff of officers and employees of Lake Lanao Development Authority and upon 
3 
recommendation of the General Manager, fix their renumerations and other 
4 
emoluments) All positions in the Authority shall be governed by the compensation, 
s 
position classification system and qualification standards approved by the General 
6 
Manager with the concurrence of the Board of Directors based on a comprehensive job 
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analysis of actual duties and responsibilities. 
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The compensation plan shall be comparable with the prevailing compensation 
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plans in the Philippine Economic Zone Authority (PEZA), the Bases Conversion 
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Development Authority (BCD A), the Clark Development Corporation (CDC) and the 
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private sector and shall be subject to the periodic review by the Board of Directors every 
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two (2) years, without prejudice to yearly merit reviews or increases based on 
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productivity and profitability. The Authority shall be exempt from existing laws, rules 
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and regulations on compensation, position classification and qualification standard. It 
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shall however endeavor to make its systems conform as closely as possible with the 
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principles under the Compensation and Position Classification Act of 1989 (RA No. 
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6758, as amended). 
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Employees and officers of the Authority including the appointed Members of the 
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Board shall not engage directly or indirectly in partisan activities or take part in any 
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election, except to vote. 
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No officer or employee of the Authority subject to civil service laws and 
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regulations shall be removed or suspended except for a cause, as provided by law. 
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SEC. 20. Auditing. - The auditing department shall be headed by the duly 
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appOinted representative of the Commission on Audit whose salary shall be determined 
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and paid according to law. All personnel of the auditing department shall be appointed, 
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and their number and salaries fixed by the Commission on Audit. 
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SEC. 21. Damages. - Compensation for any damage to the water and aquatic 
28 
resources of Lake Lanao and its tributaries resulting from failure to meet established 
29 
water and effluent quality standards or from such other wrongful act or omission of a 
30 
person, private or public, juridical or otherwise, punishable under the law shall be 
31 
awarded to the Authority for water quality control and watershed management 
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projects. 
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SEC. 22. Annual Fees. - The Lake Lanao Development Authority is hereby 
34 
authorized to collect annual fees for the use of the lake waters and its tributaries for all 
35 
beneficial purposes including fisheries, aquaculture, municipal, industrial, agricultural 
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including irrigation, hydroelectric power generation, transport and navigation, waste' 
37 
disposal purposes, and recreation among others. All the fees collected shall be 
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accordingly appropriated for the sustainable development of the lake and its watershed 
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areas, The Authority's collection of fees shall form part of its corporate funds and shall 
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not be remitted to the National Treasury as an exemption to the provisions of 
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Presidential Decree No. 1234. 
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SEC. 23. Capitalization. - The Authority shall have an authorized capital of Two 
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Billion Pesos (2,000,000,000 PhP) no par value shares, of which the amount of One 
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Billion Pesos (1,000,000,000 PhP) shall be subscribed by the province, cities, and 
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municipalities in the Area and at least twenty-five percent (25%) shall be subscribed by 
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the National Government. 
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SEC. 24. Appropriations. - The sum of Fifty Million Pesos (50,000,000 PhP) 
4 
necessary for the initial operating expenses of the Authority is hereby charged to the 
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appropriations authorized for the Regional Development Fund. Thereafter, the sum 
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necessary for the continued operation and maintenance of the Authority shall be 
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included in the annual budget of the Office of the President. 
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SEC. 25. Creation of a Public Hearing Committee. - For the purpose of 
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effectively carrying out the quasi-judicial powers of the Authority within the Lake 
10 
Lanao Watershed Area, a Public Hearing Committee is hereby created composed of a 
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Chairman and two (2) other members to be designated by the General Manager. Any 
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decision, order or resolution must be concurred by the majority member of the 
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Committee and duly approved by the General Manager. 
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SEC. 26. Creation of Lake Police Force. - The National Police Commission shall 
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constitute and assign a special police force, to be known as the Lake Lanao Police, 
16 
exclusively for the Lake Lanao Area, trained especially for enforcement of 
17 
environmental and fisheries laws and the rules and regulations promulgated by the 
18 
Lake Lanao Development Authority. 
. 
19 
The extent of operational supervision and control by the General Manager over 
20 
the Lake Lanao Police shall be the same as that of local chief executives over police force 
21 
of local government units (LGUs) as defined in the Department of Interior and Local 
22 
Government (DILG) Act of 1990 (RA 6975), in relation to Sec. 73 of the Local 
23 
Government Code of 1991 (RA 7160). 
24 
SEC. 27. Exemption from Tax. - The Authority shall be exempt from payment of 
25 
all taxes imposed by the National Government, its provinces, cities, municipalities and 
26 
other government agencies and instrumentalities: Provided, That, its subsidiary 
27 
corporations shall be subject to all said taxes five (5) years after their establishment 
28 
under a graduated scale. Such exemption shall include any tax or fee imposed by the 
29 
Government ott the sale, purchase or transfer of foreign exchange and all notes, bonds, 
30 
and debentures, and other obligations issued by the Authority, both as to the principal 
31 
and interest. 
32 
SEC. 28. Penal and Civil Liability Clause. - Any person, natural or juridical, 
33 
who shall violate any of the provisions of this Act or any rules and regulations 
34 
promulgated by the Authority pursuant thereto shall be liable to imprisonment of not 
35 
exceeding three (3) years or to a fine not exceeding Fifty Thousand Pesos 
(PhP 
36 
50,000.00) or both at the discretion of the court. This is wihout prejudice to the 
37 
imposition of penalties as may be provided under relevant and existing laws, rules, and 
38 
regulations; Provided, that, for every two (2) years, periodic adjustments as 
39 
recommended by the National Statistics Office (NSO), shall be implemented to maintain 
40 
the deterrent function of the fine. 
41 
SEC. 29. Repealing Clause. - All republic acts, executive orders, rules and 
42 
regulations, and other issuances,. or parts thereof, that are inconsistent with the 
43 
provisions of this Republic Act are hereby repealed or modified accordingly. 
11 


1 
SEC. 30. Separability Clause. - If tor any reason or reasons, any part or provision 
2 
of this Act shall be declared or held to be unconstitutional or invalid other parts or 
3 
provisions hereof, which arc;, not affected thereby shall continue to be in full force and 
4 
effect. 
5 
SEC. 31. Effectivity. - This Act shall take effect fifteen (15) days following its 
6 
publication in at least two (2) national newspapers of general circulation. 
7 
Approved. 
12