Republic of the Philippines

HOUSE OF REPRESENTAT! STs
Quezon City 1™. Gig
BY:
Seventeenth Congress REGISTRATION UNIT
First Regular Session BILLS AND INDE X SERVICE
642

HOUSE BILL NO.:

Introduced by: REP. HARLIN NEIL J. ABAYON III
Party-list, AANGAT TAYO

EXPLANATORY NOTE

This bill seeks to provide for the restructuring of arrearages
and condonation of interests and surcharges due as well as other
interest that may accrue on the principal obligation incurred by
Northern Samar Electric Cooperative, Inc. (NORSAMELCO) payable
to the Power Sector Assets and Liabilities Management Corporation
(PSALM).

In 2003, NORSAMELCO incurred accounts payable due for its
power bills in the amount of twelve million five hundred twenty-
seven thousand five hundred thirty-five pesos (P12,527,535.00).

For the past eleven (11) years, NORSAMELCO has not been
able to pay in full its yearly power bills. So, its outstanding balance
as of December 2014 with PSALM ballooned to six hundred eighty-
four million two hundred seventy-three thousand one hundred
sixty-one 60/100 pesos (P 684,273,161.60).

NORSAMELCO was continuously paying its payables but
insufficient to cover the indebtedness in full.

Its payments that where initially applied for interests and
surcharges since 2003 amounting to two hundred twelve million
four hundred twenty-nine thousand three hundred three 28/100
pesos (P 212,429,303.28) shall now be applied to the outstanding
balance of six hundred eighty-four million two hundred seventy-
three thousand one hundred sixty-one 60/100 pesos (P

HOUSE WF REPRESENTATIVES
RECEIVED
pare, 30 JUN 2016

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684,273,161.60). Thus, reduces the indebtedness and left a
remaining balance of four hundred seventy-one million eight
hundred forty-three thousand eight hundred fifty-eight 32/100
pesos (P 471,843,858.32).

NORSAMELCO is heavily burdened by its arrearages with
PSALM thus constantly impeding its mandate to render efficient
service and regular supply of electricity to Nortehanons.

As shown above, PSALM should be considerate by applying
leniency to NORSAMELCO in its arrearages by restructuring the
same and condoning the interests and surcharges due as well as
other interest that may accrue therefrom until the effectivity of this
Act.

Henceforth, the remaining balance of four hundred seventy-
one million eight hundred forty-three thousand eight hundred fifty-
eight 32/100 pesos (P 471,843,858.32) shall be paid free of interest
in twenty (20) years with monthly amortization of two million one
hundred eighty-four thousand four hundred sixty-two 31/100
pesos (P2,184,462.31) or equivalent to yearly payment of twenty-six
million two hundred thirteen thousand five hundred forty-seven
60/100 pesos (P26,213,547.68) with two (2) years grace period. All
interests and surcharges due and payable as well as other interests
that may accrue therefrom until the effectivity of this Act shall be
condoned.

Further, it is to be noted that through electric cooperatives
total electrification of the country is being pursued by enhancing
distribution development. It is therefore imperative to restructure
ailing electric cooperatives with the view of making them
economically and financially viable.

In view of the foregoing, the immediate passage of this bill is

imperative.
HARLI on J. ABAYON III


Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City

Seventeenth Congress
First Regular Session

HOUSE BILL NO.: Gas

Introduced by: REP. HARLIN NEIL J. ABAYON II
Party-list, AANGAT TAYO

AN ACT PROVIDING FOR THE
RESTRUCTURING OF ARREARAGES AND
CONDONATION OF INTEREST AND SURCHARGES DUE
AS WELL AS OTHER INTEREST THAT MAY ACCRUE ON
THE PRINCIPAL LOAN INCURRED BY NORTHERN
SAMAR ELECTRIC COOPERATIVE, INC. (NORSAMELCO)
PAYABLE TO THE POWER SECTOR ASSETS AND
LIABILITIES MANAGEMENT CORPORATION (PSALM)

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

Section 1. Title. This Act shall be known as the Northern
Samar Electric Cooperative (NORSAMELCO) Arrearages
Restructuring and Condonation Act. It shall hereinafter referred to
as the Act.

Section 2. Declaration of Policy. It is hereby declared the
policy of the State to promote sustainable development in the rural
areas through rural electrification; empower and strengthen the
NEA to pursue the electrification program and bring electricity,
through the electric cooperatives as its implementing arm, to the
countryside even in missionary or economically unviable areas; and
empower and enable electric cooperatives to cope with the changes
brought about by the restructuring of the electric power industry
pursuant to Republic Act No. 9136, otherwise known as the
“Electric Power Industry Reform Act of 2001.”


Section 3. Definition of Terms. As used in this Act:

a. Accumulated — means gathered or collected together in an
increasing quantity;

b. Accrued — means gain, addition or increment;

c. Condonation — refers to the relief granted by law in the
payment of unpaid interest and surcharges;

d. Arrearages restructuring — refers to the process where the
principal terms and conditions of the original loan are
modified in accordance with an agreement setting forth the
new schedule of payment;

e. NORSAMELCO - refers to Northern Samar Electric
Cooperative, Inc;

f. Power bill — refers to the statement of account indicating the
products, quantities and prices for the products and/or prices
provided by the seller to the buyer;

g. PSALM - refers to the power supplier Power Sector Assets and
Liabilities Management Corporation

Section 4. Condonation of Interests and Surcharges. The
interests including other interests that may accrue until the
effectivity of this Act and surcharges on the principal obligation
incurred by Northern Samar Electric Cooperative, Inc.
(NORSAMELCO) payable to Power Sector Assets and Liabilities
Management Corporation (PSALM) incurred from 2003, in whatever
accumulated amount or sum of interest and surcharges as there
may be are hereby condoned, thereby perpetually relieving
NORSAMELCO from payment thereof.

The amount paid in the sum of two hundred twelve million
four hundred twenty-nine thousand three hundred three 28/100
pesos (P 212,429,303.28), which was applied in payment of
interests and surcharges, shall be applied to, and deducted from
the outstanding balance of six hundred eighty-four million two
hundred seventy-three thousand one hundred sixty-one 60/100
pesos (P 684,273,161.60) instead.


Section 5. Restructuring of arrearages. The principal terms
and conditions of the remaining balance of the arrearages in the
sum of four hundred seventy-one million eight hundred forty-three
thousand eight hundred fifty-eight 32/100 pesos (P
471,843,858.32) are hereby modified and restructured.

The arrearages shall be paid free of interest in twenty (20)
years with monthly amortization of two million one hundred eighty-
four thousand four hundred sixty-two 31/100 pesos
(P2,184,462.31) or equivalent to yearly payment of twenty-six
million two hundred thirteen thousand five hundred forty-seven
60/100 pesos (P26,213,547.68) with two (2) years grace period.

Section 6. Effectivity. This Act shall take effect fifteen (15)
days after its publication in at least two (2) newspapers of general
circulation.

Approved.