Republic of the Philippines 09
House of Representatives JUL 2013
Quezon City i

Sixteenth Congress
First Regular Session

1240

HOUSE BILL NO.

Introduced by Representative DEOGRACIAS B. RAMOS, Jr.

EXPLANATORY NOTE

This bill seeks to bar local government units from obtaining loan for
infrastructure projects one (1) year prior to every National and/or Local
Elections. In the same vein, this is also intended to stop lending institutions
from approving it, or releasing its proceeds to the local government.

Loans of any kind are burden to local governments. As such, it must be use to
serve its purpose and not to fatten the pockets of public officials. But unlike
loans for social services, loans for infrastructure are source of graft and
corruption especially when election draws near. It is arguably the milking cow
of crooked politicians and the money stashed from this practice is used during
elections.

On the other hand, corrupt public officials can hardly reap monetary windfall
from livelihood projects, and financial (burial, educational, medical and
transportation) assistance to indigent constituents because of the very nature
of this service.

This will serve us guaranty to our people that loans contracted by their local
government units one year before the election will be for social services only.

The immediate approval of this bill is earnestly sought.

DE@GRAC! RAMOS, IR.
District, Sorsogon


Republic of the Philippines
House of Representatives
Quezon City

Sixteenth Congress
First Regular Session

1240

HOUSE BILL NO.

Introduced by Representative DEOGRACIAS B. RAMOS, Jr.

AN ACT PROHIBITING LOCAL GOVERNMENT UNITS FROM APPLYING

FOR LOANS TO FINANCE INFRASTRUCTURE PROJECTS AND LENDING

INSTITUTIONS FROM APPROVING IT OR RELEASING THE PROCEEDS
ONE YEAR BEFORE ELECTIONS.

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

SECTION 1. Short Title. This Act shall be known as Loan Election Ban of
2013.

SECTION 2. Declaration of Policy. The State shall maintain honesty and
integrity in the public service and take positive and effective measures against
graft and corruption.

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

(a) “Infrastructure loan” shall mean loan made by a local government unit
from any private or public lending institution for the purpose of financing
the construction, rehabilitation, repair or improvement of local
infrastructure project.

(b) “Local government unit” shall mean political subdivision of the State duly
constituted by law which has substantial control of local affairs. It shall
refer to barangay, municipality, city, province and the Autonomous
Region in Muslim Mindanao (ARMM).

(c) “Local infrastructure project” shall include but is not limited to the
construction, repair, rehabilitation or improvement of buildings, roads,
bridges, public markets, pavements, pathways, footbridges, fences,
stages, police/jail/fire stations, housing units, flood control, water supply
system, irrigation _projects/facilities, electrification —_ projects,
septage/sewerage project.


SECTION 4. Prohibited Acts. The following acts shall be prohibited:

(a) The enactment of a resolution by the sangguniang barangay,
sangguniang bayan, —sangguniang —_panlungsod, — sangguniang
panlalawigan, or the Regional Legislative Assembly (ARMM) authorizing
the local government unit, through the punong barangay, mayor or
governor, as the case may be, to apply or obtain loan for local
infrastructure projects one (1) year before the local or national elections;

(b) The signing or execution of any infrastructure loan agreement involving
the local government unit and the private or public lending institution one
(1) year before the local or national elections;

(©) The approval by the private or public lending institution of the
infrastructure loan application of the local government one (1) year
before the local or national elections; and

(d) The release by the private or public lending institution of the amount or
proceeds of the infrastructure loan to the local government one (1) year
before the local or national elections.

SECTION 5. Criminal Liability. - (a) Any elective local official who commits
an act prohibited under this law shall be punished by imprisonment of three
years and one day to six years.

(b) Any public employee or private individual who knowingly participated in
the commission of an act prohibited under this law shall be punished by
imprisonment of one year and one day to three years,

SECTION 6. Separability Clause. - If any section or part of this Act is held
unconstitutional, no other section or provision shall be affected.

SECTION 7. Repealing Clause. All laws, decrees, executive orders, rules
and regulations, issuances or any part thereof inconsistent with the provisions
of this Act are deemed repealed,

SECTION 8. Effectivity. - This Act shall take effect (15) days after its
publication in at least two (2) national newspapers of general circulation.

Approved,