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THIRTEENTH CONGRESS OF THE REPUBLIC 
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$h(%i 3Q p5 :20 
OF THE PHILIPPINES 
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First Regular Session 
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S E N A T E  
S. No. 
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Introduced by Senator S. R. Osmefia 111 
EXPLANATORY NOTE 
It is the government’s moral duty to provide its population what is 
necessary to enable it to live a useful and productive life. Physical infrastructure 
is therefore vital, as it directly affects people’s everyday living. Infrastructure 
development, maintenance and improvement are historically considered to be 
one of the State’s most fundamental responsibilities, since it is concerned with 
the upkeep and enhancement of the country’s over-all land-area. 
However, the large financial requirements place a demanding pressure on 
the already-deficient national budget. The de-prioritization has resulted to a 
deteriorating infrastructure base, making the average Filipino contend with even 
more difficult circumstances. Roads, mass transportation and modern means of 
communication-necessary 
to sustain and develop the citizenry-have 
been 
regarded as significantly less important, relative to more pressing “immediate” 
concerns. 
The Build-Operate-Transfer (BOT) scheme was established in cognizance 
of the fact that there is an absence of support from the government for 
infrastructure undertakings. It was envisioned that the BOT would result to a 
well-conceptualized and coordinated infrastructure program that would correlate 
with the national development agenda. The private sector could be tapped to 
plug the inadequacy, recognizing its role as the government’s partner in nation- 
building. However, the contribution has so far been minimal, especially in the 
road construction portion. The required capital and financial outlay is believed to 
be prohibitive, and since projects of this nature usually realize returns over the 
long-term, private sector participation has expectedly been limited. This set-up 
has resulted in arbitrary participation and has hence made the general 
infrastructure situation uncoordinated, lacking, and at times, even redundant. 
But despite the seeming obstacle of procuring loans for funding, project 
proponents usually still end-up with considerable profits. It should be posed 
then, that if the private sector has found infrastructure projects to be viable-- 
notwithstanding its profit-driven paradigm and the incurred borrowing and 
financing costs-- what more the government whose sole responsibility is to look 
after the general welfare of its people? It is clear that the government is the only 
sovereign body that has the resources, capability and expertise to plan and 


coordinate infrastructure programs, consistent with its responsibility enshrined in 
the Constitution. 
Moreover, given the same amount of financing, it could 
construct more and better road networks and highways. 
This Bill seeks to establish a corporate body which shall be called the 
“Road Development Authority,” (hereinafter referred to as “Authority”) which will 
be under the Office of the President. The Authority shall have the responsibility 
to ensure the easy mobility of people and goods all over the country, by being 
the central agency that will handle, coordinate and assure the building of roads, 
highways, bridges and other necessary physical infrastructure, complementary to 
the national development efforts. It shall be allowed to secure loans and grants 
toward this end, and shall be in-charge of initiating projects that do not get 
subscribed by the private sector. Due to the nature of its mandate, it shall work 
closely with the Department of Public Works and Highways and the Department 
of Transportation and Communications. 
Due to the foregoing, early passage of this Bill is earnestly sought. 
/ 
SERGIO OSMENA 111 
Senator 
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JUld 3u p5 20 
THIRTEENTH CONGRESS OF THE WEPUBLl 
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OF THE PHILIPPINES 
1 
First Regular Session 
s. No. 
Introduced by Senator S. R. Osmefia 111 
AN ACT 
CREATING A ROAD DEVELOPMENT AUTHORITY, PROVIDING FUNDS 
THEREFOR AND FOR OTHER PURPOSES 
Be it enacted by the Senate and fhe House of Representatives of the 
Philippines in Congress assembled: 
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SECTION I. 
Title. - This Act shall be known as the “Road Development 
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Act of 2004.” 
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SECTION 2. Declaration of Policy. - It is hereby declared the policy of 
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the State to implement an integrated program for the planning, development, 
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financing, construction, maintenance and operation of major highways and public 
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thoroughfares all over the country to spur economic development. 
SECTION 3. Creation of the Road Development Authority. - There is 
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hereby created a body corporate to be known as “Road Development Authority,” 
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hereinafter referred to as “Authority,” which shall be attached to the Office of the 
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President and charged primarily for the construction and/or rehabilitation, 
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complement the over-all national development efforts, where there are no takers 
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from the private sector. The principal office of the Authority shall be located in 
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Metropolitan Manila, but it may establish offices elsewhere in the Philippines as 
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may become necessary for the proper and efficient conduct of its business 


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SECTION 4. Powers and Functions of the Authority. -- 
a.) The corporate powers of the Authority shall be as follows: 
(i) 
(ii) 
To success in its corporate name; 
To sue and be sued in such corporate name; 
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(iii) 
To adopt, alter and use a corporate seal which shall be 
judicially noticed; 
To create or alter its own organization, and staff such an 
organization with appropriate and qualified personnel in 
accordance with what may be deemed proper and 
necessary to achieve the objectives of the Authority; 
To make or enter into contracts of any kind or nature to 
(iv) 
(v) 
enable it to discharge its functions under this Act; 
(vi) 
To acquire, purchase, own, lease, mortgage, sell or 
otherwise dispose of any land or property of any kind, 
whether movable or immovable; 
To exercise the right of eminent domain, by expropriating 
the land or areas along proposed highways or public 
thoroughfares; 
To construct, operate and maintain toll facilities in major 
roads, highways and public thoroughfares vested in or 
belonging to the Authority; 
To collect, subject to the determination and approval *
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of the 
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Toll Regulatory Board, just and reasonable tolls, fees, 
rentals or charges for the use of the toll facility; 
To reclaim, excavate, enclose or raise any part of the lands 
vested in the Authority; 
(vii) 
(viii) 
(ix) 
(x) 
(xi) 
To raise and/or borrow, within the limitation provided by law, 
the necessary funds from local and international financial 
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institutions and to issue bonds, promissory notes and other 
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securities for that purpose and to secure the same by 
guarantee, pledge, mortgage, deed of trust, or assignment 
of its properties held by the Authority for the purpose of 
financing its projects and programs within the framework and 
limitations of this Act; 
To do all such other things and to transact all such business 
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(xii) 
directly or indirectly necessary, incidental or conducive to the 
attainment of the purposes of the Authority; 
To exercise all the powers of a corporation under the 
Corporation Law insofar as they are not inconsistent with the 
(xiii) 
provisions of this Act; 
b.) 
The corporate functions of the Authority shall be as follows: 
(i) 
To formulate, in coordination with the National Economic 
Development Authority and the Department of Public Works 
and Highways, a comprehensive and practicable and major 
highways and public thoroughfares development plan for the 
State and to program its implementation; 
To construct, maintain, operate and provide such facilities 
(ii) 
and services as are necessary in the major highways and 
public thoroughfares vested in, or belonging to the Authority; 
To coordinate with the Bureau of Lands or any other 
(iii) 
government. agency or corporation in the development of 
any foreshore area; 
To exercise such powers as may be essential, necessary or 
incidental to the powers granted to it in the preceding sub- 
(iv) 
paragraph as well as to carry out the policies and objectives 
in this Act. 
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SECTION 5. Board of Directors. -- 
a.) 
The corporate powers of the Authority shall be vested in and 
exercised by a Board of Directors, hereinafter referred to as the 
Board, which shall consist of the following: 
The Chairman of the Board and Administrator of the Authority 
who shall be appointed by the President of the Philippines to 
serve for a term of six (6) years, unless sooner removed for 
cause. In case of removal for cause, the replacement shall 
serve only the unexpired portion of the term; . 
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The Secretary of the Public Works and Highways; 
The 
Director-General of the 
National Economic 
and 
Development Authority; 
The Secretary of Transportation and Communications; 
The Secretary of Finance; 
Two (2) other persons who shall be appointed by the 
President of the Philippines, representing the private sector, 
who by reason of their knowledge or experience are, in the 
opinion of the President, fit and proper persons to be directors 
of the Board. They shall hold office for a period of three (3) 
years from the date of their appointment and shall be eligible 
for reappointment upon the completion of such period; 
b.) 
The Directors listed under sub-sections a.) (ii) to (v) shall be ex- 
officio members of the Board of Directors: Provided, That in their 
absence the Directors concerned shall delegate the officer next in 
rank to them in their department or office to act on their behalf as 
Director; 
c.) 
The members of the Board or their respective alternates shall 
receive a per diem of not more than Five thousand Pesos 
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(P5,OOO.OO) for every Board meeting actually attended by them: 
Provided, however, That the per diem collected per month shall not 
exceed the equivalent of four (4) meetings: Provided, further, That 
the amount of per diem shall not be increased within two (2) years 
after its last increase: Provided, finaly, That the ex-officio members 
shall not be paid other allowances or any form of compensation, 
except actual expenses in traveling to or form their residences to 
attend Board meetings. 
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d.) 
Chairman/ Administrator - The President of the Ph 
appoint a professional manager as Administrator of 
who shall be the Chairman of the Board and Chief 
of the Authority. 'He shall receive pay and allowances 
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lippines shall 
the Authority 
Exxutive Officer 
and privileges. 
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SECTION 6. 
Organizational Structure. - The Administrator shall, 
subject to the approval of the Board, determine the organizational structure, the 
staffing pattern and the number of personnel of the Authority, define their duties 
and responsibilities, and fix their salaries and emoluments that are comparable 
to those of similar positions in other government-owned corporations, the 
provisions of existing rules and regulations on wage and position classification 
notwithstanding. The Administrator shall, subject to the approval of the Board, 
appoint and remove personnel below the rank of Assistant Administrator. The 
number of Assistant Administrators of the Authority shall in no case exceed three 
(3) who shall each receive a salary to be determined by the Board and approved 
by the President. 
SECTION 7. General Powers and Duties of the Administrator and 
Assistant Administrators. - a.) General Powers and Duties of the 
Administrator - The Administrator shall be responsible to the Board and shall 
have the following powers, functions and duties: 
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(i) 
To implement, enforce and apply the policies, programs, 
guidelines, procedures, decisions, rules and regulations 
promulgated, prescribed, issued or adopted by the Authority; 
To manage the day-to-day affairs of the Authority, and ensure 
the operational efficiency of all its officers; 
(ii) 
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(iii) 
To sign contracts, to approve expenditures and payments 
within the budget provisions, and generally do all acts for the 
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proper and efficient operations of the Authority; 
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(iv) 
To undertake research, studies and investigations and other 
activities to support the preparation of plans for the 
infrastructure projects that have to be undertaken and submit 
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the same for the information and approval of the Board; 
(v) 
To negotiate with local and international financial institutions in 
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order to raise and/or borrow the necessary funds to finance 
proposed infrastructure projects; 
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(vi) 
To perform such other duties as the Board may assign from 
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time to time. 
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a.) General Powers and Duties of the Assistant Administrators - The 
Assistant Administrators shall be responsible to the Administrator of 
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the Authority and shall have the following general powers, functions 
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and duties: 
(i) 
To assist the Administrator in implementing, enforcing and 
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applying the policies, programs, guidelines, procedures, 
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decisions, rules and regulations 
promulgated, prescribed, 
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issued, or adopted by the Authority; 
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(ii) 
To assist the Administrator in the performance of his other 
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functions and duties; 
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(iii) 
To perform such other duties as the Administrator may assign 
from time to time. 
SECTION 8, Capitalization. - The Authority shall have an authorized 
capital of TEN (I 
0) BILLION PESOS (P10,000,000,000.00). The initial paid-up 
capital shall consist of: 
a.) 
Cash contribution by the Government in the amount of TWO 
HUNDRED MILLION PESOS (P200,000,000.00) a year for the next 
three (3) years; which is hereby appropriated out of any fund in the 
National Treasury not otherwise appropriated; 
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b.) 
AI1 other assets which the President may transfer to the Authority as 
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SECTION 10. 
Borrowing Powers. -- 
The Authority may, after 
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consultation with the Bangko Sentral ng Pilipinas and the Department of 
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Finance, and with the approval of the President of the Philippines, raise funds, 
part of the equity contribution of the Government. 
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either from local or international sources, by way of loans, credits or 
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indebtedness or issue bonds, notes, debentures, securities, and other borrowing 
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instruments, including the power to create pledges, mortgages, and other 
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voluntary encumbrances on any of its assets or properties. The loans contracted 
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by the Authority under this Section together with all interests and other sums 
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payable in respect thereof, shall constitute a charge upon all the revenues and 
assets of the Authority and shall rapk pari passu with one another, but shall have 
priority over any other claim or charge on the revenue and assets of the 
Authority: Provided; That this provision shall not be construed as a prohibition or 
restriction on the power of the Authority to create pledges, mortgages and other 
voluntary iiens or other encumbrances on any property of the Authority. 
Except as expressly authorized by the President of the Philippines, the 
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total outstanding indebtedness of the Authority in the principal amount in local 
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and foreign currency shall not ,at any time exceed the authorized capitalization.of 
the Authority. 
The President of the Philippines, by himself or through his duly authorized 
representative, is further hereby authorized to guarantee in the name and on 
behalf of the Republic of the Philippines, the payments of loans or other 
indebtedness of the Authority up to the amount herein authorized. 
All interests paid or payable by the Authority on its loans or other forms of 
indebtedness shall be exempt from taxes of whatsoever nature. 
SECTION I O ,  Annual Accounts. -- The Board shall cause proper 
accounts and other records of the Authority in relation thereto to be kept. An 
annual statement of account shall be rendered in respect to each year. The 
Authority shall maintain such accounts and other records under a commercial 
system of accounting. The accounts of the Authority shall be kept and made up 
to 31 December in each year. 
The annual statement of accounts of the Authority shall present a true and 
fair value of the financial position of the Authority and of the results of the 
operations of the Authority for the year to which it relates. 
SECTION 11. Auditor. -- The Commission on Audit (COA) shall be the 
full time auditor of the Authority. For this purpose, the COA shall designate its 
representative who shall perform the actual audit of the 'accounts of the' 
Authority. The Authority shall provide the COA representative and hidher staff 
with a suitable office space, supplies, equipment, furniture and other necessary 
operating expenses for its proper maintenance, including expenses for travel and 
transportation. The salaries and allowances of the COA representative and his 
staff shall be paid directly by the COA from its own appropriations and other 
contributions. The COA representative shall, as soon as possible, but not later 
than three (3) months after the accounts have been submitted for audit, send an 
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audit report to the Board. He may also submit such periodical or special reports 
to the Board as may to him appear necessary. 
SECTION 12. Annual Report. - The Board shall submit to the President 
of the Philippines together with the Auditor’s Report on the relevant accounts, .an 
annual report generally dealing with the activities and operations of the Authority 
during the preceding year and containing such information relating to the 
proceedings and policies of the Authority. 
SECTION 13. Separability Clause. - If any provision of this Act shall be 
held unconstitutional or invalid, the other provisions not otherwise affected shall 
remain in full force and effect. 
SECTION 14. Repealing Clause. - All laws, executive orders, or parts 
thereof which are inconsistent herewith are hereby repealed or accordingly 
amended. 
SECTION 15. Effectivity. - This Act shall take effect upon its publication 
in at least two (2) newspapers of general circulation. 
Approved,