Republic of the Philippines ome ell

HOUSE OF REPRESENTATIVES Ss
Quezon City RrCeved 4
THIRTEENTH CONGRESS Ot 200k
First Regular Session

HOUSE BILLNo. 04

Introduced by: HON. EMILIO C. MACIAS II

EXPLANATORY NOTE

Presidential Decree No. 269, as amended otherwise known as the Rural Electrification
Decree was issued in 1973 with the objective of attaining total electrification of the entire
Philippines. However, it has already been more then two (2) decades now since the electrification
program was launched, yet, there are still numerous areas in the countryside which do not have
supply of electricity.

The national government has a perennial funding problem and therefore local
government units, if only to pursue the objective of the law, must be given reasonable discretion
to tap any available sources of funding to enable them to collaborate with the national
government in such kind of worthy undertaking for the benefit of the poor people, particularly in
remote areas. This kind of undertaking however, may not be possible due to the existence of a
provision in the Local Government Code which provides restrictions on how the share of local
government units will be spent.

Section 294 of the Local Government Code expressly limits the use of the share of the
proceeds derived from the development and utilization of sources of energy to the reduction of
the cost of electricity in the area where such a source is located. If the number of population is
considered, the application of the proceeds to lower the cost of electricity will be negligible,
particularly in densely populated area, but the amount may be sufficient to finance the
electrification of other areas within the province where the source of energy is located.

‘The local government units are supposed to be in a better position to determine the needs
of their constituents and what is best for them. However, local government units are severely
restrained to exercise their best option due to the existence of the aforementioned provision in the
Code which dictated upon them what to do with their own money. This system runs counter to the
attainment of local autonomy.

A curative legislation therefore that will allow local goverment units to use the share of
the proceeds derived ftom the development and utilization of various sources of energy as
intended in this bill is highty recommended.

It is important to note that the House of Representatives and the Senate Committee on
Locel Government had elready approved this bill. Unfortunately, however, the Senate failed to
act on the same for lack of material time.

MILIO C. MACIAS II M.D.
Representative
‘Second Dist., Negros Oriental


Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City

THIRTEENTH CONGRESS
First Regular Session

rn
HOUSE BILLNo.__ 04

Introduced by: HON. EMILIO C, MACIAS IT

AN ACT

AUTHORIZING LOCAL GOVERNMENT UNITS TO APPLY THE SHARE OF
THE PROCEEDS DERIVED FROM THE DEVELOPMENT AND UTILIZATION
OF HYDROTHERMAL, GEOTHERMAL, AND OTHER SOURCES OF
ENERGY FOR ELECTRIFICATION OF OTHER AREAS WITHIN THE
PROVINCE WHERE THE SOURCE OF ENERGY IS LOCATED AMENDING
FOR THE PURPOSE SECTION 294 OF REPUBLIC ACT NO. 7160
OTHERWISE KNOWN AS THE LOCAL GOVERNMENT CODE OF 1991

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

SECTION 1. Section 294 of Republic Act No. 7160 otherwise known as the
Local Government Code of 1991 is hereby amended to read as follows:

“SECTION 294. Development and Livelihood
Projects. The proceeds from the share shall be appropriated
by their respective sanggunian to finance local development
and livelihood projects: Provided, however, that at least
eighty percent (80%) of the proceeds derived from the
development and utilization of hydrothermal, geothermal
and other sources of energy shall be applied [solely] FOR
ELECTRIFICATION OF OTHER AREAS WITHIN THE
PROVINCE OR to lower the cost of electricity in the local
government unit where such a source of energy is located,”

SEC. 2. This Act shall take effect upon its approval.

Approved,