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Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City

EIGHTEENTH CONGRESS
First Regular Session

4759

HOUSE BILL NO.

Introduced by Hon. John Marvin “Yul Servo” C. Nieto

EXPLANATORY NOTE

This bill seeks to provide a large-scale housing development plan that will integrate
all new and existing housing programs in the country. It will then be the
responsibility of the State, consistent with ali pertinent rules and regulations, to
support through appropriations and institutionalization of programs the alleviation
of the perennial housing and resettlement problems that continue to plague our
country.

Socialized housing projects, without the access to necessary public services, is futile.
Relocated families will have to suffer long distances just to avail of basic health care,
education, and other public goods and services. This will inevitably pose additional
and unnecessary financial burden to our kababayans, which they do not, in any way,
deserve. Our countrymen deserve the best housing and resettlement policies, and
this bill aims to achieve just that.

As a manifestation of support to the initiative of Senator Bong Go, as well as the
consolidated efforts of the Department of Housing and Urban Development, the
National Housing Authority and aii its instrumentaiities, this representation
respectfully files this bill.



Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City

EIGHTEENTH CONGRESS
First Regular Session

House Brito. 4759

Introduced by Hon. John Marvin “Yul Servo” C. Nieto

AN ACT
PROVIDING FOR A NATIONAL HOUSING DEVELOPMENT, PRODUCTION,
AND FINANCING PROGRAM, REGULARIZING ITS APPROPRIATION FOR ITS

IMPLEMENTAION

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

SECTION 1. This Act shall be known as the “NATIONAL HOUSING
DEVELOPMENT, PRODUCTION, AND FINANCING (NHDPF) ACT OF 2020”

SECTION 2. Declaration of Policy. -It is hereby declared a policy of the State to:

a) Undertake, in cooperation with the private sector, a continuing program of
housing and urban development which shall make available at affordable cost,
decent housing and basic services especially to the underprivileged and
homeless citizens;

b) Pursue the realization of a modern, humane, economically viable, and
environmentally-sustainable society where the urbanization process is
manifest in towns and cities being centers of productive economic activity and
is led by market forces; where urban and rural areas have affordable housing,
sustainable physical and social infrastructure and services facilitated under the
democratic and decentralized system of governance; and where urban and
rural areas provide the opportunities for an improved quality of life and
eradication of poverty;

c) Ensure that poor dwellers shall be provided with appropriate and innovative
housing program and support mechanisms to discourage further growth of

blighted communities; and,

d) Encourage on-site development, whenever feasible, in the implementation of
housing programs and shall promote the creation of new settlements with
basic facilities and utilities and development of sustainable urban renewal

programs.

Cognizant of the role of housing as stimulus of economic growth and development,
it is hereby declared a state policy to strengthen, promote, and support the
component activities of housing production and finance by ensuring


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continuous/sustained funding support to scale-up the implementation of the major
components of the National Housing Development and Production Program

SECTION 3. Statement of Objectives. - Towards this end, the State shall:

a) Increase housing production by forging partnership among housing stakeholders
to address the housing needs of the Filipino families by 2040.

b) Generate and mobilize funds for housing purposes of Filipino families, giving
priority to the homeless and underprivileged.

c) Ensure the provision of support mechanisms/subsidy program to improve access
of Filipino families to a variety of housing options.

d) Guarantee the development of a strong, sustainable, accessible, and affordable
housing finance system

e) Encourage public and private sector participation in the implementation of
government National Housing Development and Production Financing Program.

SECTION 4. National Housing Development Production Program
Implementation — Consistent with the aforementioned policy and objectives, the
Department of Human Settlements and Urban Development (DHSUD) and its
attached Key Shelter Agencies, shall intensify the implementation of the vital
components of the National Housing Development Production and Financing
Program. The implementation of this program shall be carried out by the following

agencies:

National Housing Authority (NHA) - the sole national government agency tasked to
implement and develop the following housing programs intended for the bottom
30% of the income population:

(1) Resettlement - This program addresses the requirements of families
affected by

a. Government infrastructure projects,

b. Those living along danger areas and,

c. Those affected Supreme Court Mandamus. It entails the provision of
vertical (from 5 to 15-storey residential building) and/or horizontal
housing units, community facilities, socio-economic and other
community support programs.

The program also involves the implementation of local/regional
resettlement projects as joint National Government-Local
Government undertakings to address the resettlement requirements
of Local Government Units (LGUs) outside Metro Manila involving
families in danger areas, those affected by infrastructure projects,
indigenous peoples and former rebels.

The government infrastructure agencies shall submit an inventory of
Informal Settler Families to be affected by their projects and their
location to the appropriate housing agencies at least two years prior
to its implementation and shall incorporate in their respective project
costs the amount needed for the relocation and resettlement of
affected families.

(2) Government Employees Housing Program - This program is intended to
provide decent and affordable housing to low-salaried government
employees.


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(3)

(4)

(5)

Settlements Upgrading - This program aims to address the security of
tenure and infrastructure requirements of informal settlements on
government-owned lands proclaimed or designated as socialized
housing sites.

Housing Program for Calamity Victims — this program is intended to
respond to the housing needs of low and marginal-income and/or
informal shelter families for transitional and/or permanent shelter
affected by calamities such as typhoons, landslides, earthquakes, and
fires for relocation to safe areas.

Land Banking - this refers to the acquisition of land, which includes the
idle government lands, at values based on existing use in advance of
actual need to promote planned development and socialized housing
programs with a view to distribute the land to qualified socialized
housing beneficiaries.

Tt covers survey and titling of individual lots for disposition to qualified
occupants, infrastructure development, housing construction and
rehabilitation of existing project sites.

Social Housing Finance Corporation (SHFC) - mandated to undertake social housing
programs that will cater to the formal and informal sectors in the low-income bracket
and to take charge of developing and administering social housing programs,
Particularly the Community Mortgage Program and its different modalities:

(6)

Community Mortgage Program (CMP) - this is a mortgage financing
program, which assists legally organized associations of underprivileged
and homeless citizens to purchase and develop a tract of land under the
concept of community ownership. The primary objective of the program
is to assist residents of blighted or depressed areas to own the lots they
occupy, or where they choose to relocate to, and eventually improve
their neighborhood and homes to the extent of their affordability. The
different modalities of the CMP are as follows:

a. Sectoral CMP - a CMP modality that caters to the different sectoral
groups including but not limited to the basic sector groups needing
resettlement assistance. A sectoral group represents a group or
coalition of persons who share similar concerns and interests and
intend to avail of resettlement assistance from SHFC, including

Indigenous Peoples (IPs), Indigenous Cultural Communities (ICCs)

and other ethnic minority groups.

Housing for Peace Process and Nation Building CMP - a CMP modality

which would lead to the achievement of national peace and

development through the provision of housing to former rebels/rebel
returnees (FR/RR). This also includes rebuilding damaged or
destroyed homes in post conflict areas of internally-displaced persons

(IDPs).

c. Post-Disaster Rehabilitation and Reconstruction CMP - a CMP
modality which provides assistance to community housing projects in
times of disaster. This program allows the communities to
immediately embark on house construction and site development
which adhere to the minimum standards and specifications of the

b,


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design and structural components of disaster-resilient housing
projects, as well as materials.

d. Industrial Workers CMP - a CMP modality intended primarily for low-
income employees of companies engaged in agro-industrial,
industrial processing zone, tourist, recreational, commercial, and
other enterprises.

e. Site Upgrading/Development CMP - a CMP modality intended to
provide site development and housing/building construction loans for
projects whose lands are donated by private or public entities
applicable to both on-site or resettlement projects.

f. Mixed-Use CMP - a CMO modality aimed at developing a self-
sustaining community by having a balanced mix of residential and
commercial spaces, well developed infrastructure and recreational
amenities along with green and open spaces and wellness areas.
Under this modality, 9% of the project area shall be allotted for green
spaces and 1% of project area for friendly facilities of Persons with
Disabilities (PWD)

National Home Mortgage Finance Corporation (NHMFC) - A government corporation
mandated to increase the availability of affordable housing loans to finance the
Filipino homebuyers on their acquisition of housing units through the development
and operation of a secondary market for home mortgages.

(7)

Securitization - this refers to the development of secondary market for
home mortgages and other housing related receivables, conveyances,
and financial instruments and the development/promotion of and
investments in new housing-related financial instruments and
investment vehicles and the capital markets thereof. Furthermore, this
would also increase and sustain funds available for housing and home
development.

Department of Human Settlements and Urban Development (DHSUD) - the primary
national government entity responsible for the management of housing, human
settlements, and urban development including the implementation of the following

programs:

(8)

(9)

Public Housing - this is a housing program that is owned and/or
managed by the government for the purpose of providing security of
tenure to the underserved families including but not limited to the
development of proclaimed socialized housing sites intended to promote
the establishment of new towns, new settlements, and urban renewal.

The term “underserved families” refers to those who are disadvantaged
in terms of access to basic services because of inability to pay or other
disparities by reason of economic or social status, ethnicity,
geographical isolation, and other circumstances.

Subsidy - this is a financing assistance scheme intended to enhance the
affordability of well targeted and most financially incapable segment of
the society. It is a grant extended to qualified low-income beneficiaries
under the National Housing Development and Production Financing
Program under any of the following alternative subsidy schemes:


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a. Extension of Interim Shelter Fund to each of the family-beneficiaries
which they can use to find safe residency and livelihood to support
their families, pending the completion of their housing units in the
relocation sites.

b. Payment for upfront cost equivalent to 5% of the project cost (e.g.
mortgage insurance, titling, etc.); and

c. Monthly payment subsidy for the first five years of the loan period in
accordance with Section 3 (a) of RA 6846 or the Social Housing
Support Fund Act. The department shall be authorized to establish
the qualification and income requirements of borrowers who will
qualify for the amortization support subsidy.

The DHSUD, in coordination with the LGUs and other national government agencies,
shall be authorized to formulate the criteria and guidelines to select the beneficiaries
that may qualify for the subsidy program.

(10) Public Rental Housing - this program involves the extension of fiscal
assistance of up to a maximum of 50% of the total construction cost for
the National Government Agencies (NGAs) and Local Government Units
(LGUs) that shall construct and operate public rental accommodation to
eligible low-income families and housing safety net for the vulnerable
sectors (e.g. senior citizens, person with disabilities, etc.)

The DHSUD shall formulate the guidelines in the implementation of
public rental housing assistance including the adoption of the
lease/rental buy-back scheme.

(11) Survey of proclaimed lands for socialized housing and inventory of
government idle lands - this involves the survey of all occupied
government lands proclaimed by the President as suitable for socialized
housing and conduct of inventory of government lands which have been
idle for more than ten (10) years except lands owned by the GOCCs and
government financial institutions engaged in shelter financing as part of
its fiduciary obligations to its members and/or taken possession of in
their ordinary conduct of business.

(12) Such other program components as may be determined by the DHSUD

SECTION 5. Appropriations by the National Government. The amount of One
Hundred = Thirty-Five billion, One Hundred Fourteen Million Pesos
(P135,114,000,000.00) or such amount necessary to carry out the provision of this
Act is hereby authorized to be appropriated annually though the General
Appropriations Act over a period of twenty (20) consecutive years commencing from
the year immediately succeeding the effectivity of this Act or until such time that
the total fund requirements provided for in this act shall have been fully released.

A total amount of Two Trillion, Six Hundred Sixty-Seven Billion, Two Hundred
Ninety-Three Million Pesos (P2,667,293,000,000.00) covering the continuing
requirement of this Act shall be appropriated to the DHSUD and Key Shelter
Agencies for the implementation of the following component programs of the NHDPF
Program:

(1) One trillion, seven hundred twenty-two billion, four hundred fortyOsix
million pesos (P1,722,446,000,000.00) for the implementation of the
following programs of NHA:


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a. Eight hundred billion and six hundred ninety million pesos
(P800,699,000,000.00) to finance the Resettlement Program under
Section 4(1) of this Act;

b. Five hundred forty-three billion and four hundred nineteen million pesos
(P543,419,000,000.00) as subsidy for Government Employees Housing
under 4(2) of this Act;

c, One hundred sixty-four billion and two hundred sixty-five million pesos
(P164,265,000,000.00) for the Settlements Upgrading under Section
4(3) of this Act;

d. One hundred one billion and seven million pesos (P101,007,000,000.00)
for the Housing Program for Calamity Victims Section 4(4) of this Act;
and

e. Sixty-three billion and fifty-six million pesos (P63,056,000,000.00) for
the Land Banking under Section 4(5) of this Act.

(2) Four hundred fifty-three billion, two hundred million pesos
(P453,200,000,000.00) for the implementation of the Community
Mortgage Program under Section 4(6) of this Act.

(3) _ Fifty billion (P50,000,000,000.00) for the Capitalization of NHMFC under
Section 4(8) of this Act.

(4) Four hundred seventy-six billion, six hundred forty-seven million pesos
(P476,647,000,000.00) for the implementation of the following program of
the DHSUD

a. Three hundred sixtyOfive billion, nine hundred seventy-nine million
pesos (P365,979,000,000.00) to finance the Public Housing under
Section 4 (8);

b. Eighty-nine billion, one hundred thirty-one million pesos
(P89,131,000,000.00) as subsidy under Section 9, broken as follows:

i. Eighteen billion, five hundred thirty-one million pesos
(P18,131,000,000.00) as interim shelter finance assistance for
the informal settler-families who will be relocated under Section 4
(9a)

ii. Sixty-three billion, seven hundred ninety-six million pesos
(P63,736,000,000.00) as upfront subsidy under Section 4(9b)

iii. Six billion, eight hundred four million pesos (P6,804,000,000.00)
as amortization support under Section 4 (9c)

c. Twenty billion, four hundred fifty-six million pesos
(P20,456,000,000.00) to finance public rental housing under Section
4(10); and

d. One billion, eighty-one million (P1,081,000,000.00) to finance survey of
proclaimed lands and conduct of inventory of government idle lands
suitable for socialized housing under Section 4 (11).

SECTION 6. LGU Sources of Funds. Section 43 RA 7279 on Socialized Housing
Tax is hereby amended, to read as follows:

Consistent with the constitutional principle that the ownership and enjoyment of
property bear a social function and to raise funds for the Program, all local
government units are hereby authorized to impose an additional one-half-percent
(0.5%) tax on the assessed value of all lands in urban areas. The proceeds from the
imposition of Socialized Housing Tax shall accrue to the special funds of the LGUs,


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which shall be used for the development of socialized housing projects and
construction and estate management of public rental housing of the LGUs.

SECTION 7. Implementation of the Securitizaton, Capital, and Secondary
Mortgage Operations Program. The NHDP Securitization for the development of
the secondary market for home mortgages of and other housing related receivables,
conveyances, and financial instruments and the development/promotion of and
investments in new housing related financial instruments and investment vehicles
and the capital markets thereof, to increase and sustain funds available for housing
and home development shall be implemented as follows:

1. The NHMFC shail be the sole impiementing agency for the NHDP securitization;
and

2. The NHMFC in coordination with the DHSUD, DOF, and BSP, and other
concerned agencies and private sector organizations, shall formulate a
program, the proceeds of which shall accrue to the Centralized Housing Fund.

3. The mortgages to be generated as a result of the implementation of the
component programs of the NHDP Program shall be sold and transferred to
NHMFC, which shall also serve as asset pool for securitization.

4. The NHMFC as the sole agency for the implementation of the NHDPA
Securitization shall manage the whole securitization process which includes
the following activities: determining the eligibility criteria for the asset pooi;
defining the preliminary structure of the notes, bonds and or instruments to
be issued, third parties to be hired; and education/briefing of target investors
for all the issues.

5. The NHMFC and NHDPFA-issued bonds, notes, and securities shall be exempt
from the registration requirements under the Securities Regulation Law in
order to accelerate the issuance of its housing related securities/financial
instruments and, this, more reasonably provide the necessary fund for
housing developments.

6, Transactions by banks involving the purchase and sale of housing bonds,
debentures and such other similar instruments shall be exempt from the
twenty percent (20%) final tax on income, documentary stamps tax, gross
receipts tax, and value added tax.

7. The investors’ yield or income from any socialized housing or economic
housing-related bond or asset-backed securities (ABS) issued by NHMFC
directly or through a special purpose entity under the Securitization Act shall
be exempt from the income tax. Such issuances shall enjoy all the tax
exemptions granted under Republic Act No. 9627 or the Securitization Act of
2004 pursuant to the State’s policy of promoting the securitization of
mortgage and housing-related receivables of government housing agencies,
to generate investment and accelerate the growth of the housing finance
sector, especially for socialized and economic housing.

8. Bonds purchased by private real estate developers shall be considered as an
alternative compliance to the balanced housing requirements under section
18 of RA 7279 as amended by RA 10884, subject to the rules promulgated by
the Department of Human Settlements and Urban Development.

9. The Philippine Guaranty Corporation created pursuant to Executive Order No.
58 (S. 2018) shall guaranty payment of the balance outstanding and due on
the guaranteed principal obligation, plus interest and yields thereon up to
eleven percent (11%) per annum for socialized housing packages, ten percent
(10%) per annum for low-cost housing packages, nine and a half percent


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(9.5%) per annum for the medium-cost housing packages and eight and one
half percent (8.5%) per annum for open housing packages.

SECTION 8. Capitalization of National Home Mortgage Finance Corporation
(NHMFC). The authorized capital stock of the NHMFC is hereby increased from
P5,500,000,000.00 pesos to P50,000,000,000.00) pesos to expand its leveraging
capacity based on the volume of mortgage loans being serviced to improve its
profitability by reducing the average cost of its fund made available for home lending
programs.

The capital of the National Home Mortgage Finance Corporation (NHMFC) shall be
Fifty billion pesos (P50,000,000,000.00), to be full subscribed by the government of
the Republic of the Philippines, hereafter referred to as the Government: Provided,
that the P25,000,000,000.00 of the capitalization shall be funded from the General
Appropriations Act and the remaining P25,000,000,000.00 shall be funded from the
declared dividend of the NHMFC in favor of the National Government shall be
deposited in a special account in the General Fund, and earmarked for the payment
of NHMFC;s increase in capitalization. Such payment shaii be released and disbursed
immediately and shall continue until the increase in capitalization has been fully

paid.

SECTION 9. Tax Exemptions. - The NHMFC shall be exempt from ail nationai,
provincial, municipal, and city taxes on income derived from its governmental
functions specifically income from its activities or transactions in the exercise of its
mandates.

SECTION 10. Multi-Year Obligational Authority — The Secretary of the DHSUD
and Heads of its attached housing agencies, pursuant to the National Housing
Development, Production and Financing Program, projects and appropriations
approved by Congress, shall, subject to the provisions of existing laws and
regulations including those of the Commission on Audit and other such terms and
conditions most favorable to the government, be given multi-year obligational
authority for housing program or project which will take more than one year to
complete that requires multi-year appropriations.

SECTION 11. Private Sector Participation - To fast trach the approval and
implementation of housing projects and reduce the cost of socialized and low-cost
housing units, the Bureau of Internal revenue, the Department of Agriculture, the
National Irrigation Authority, the Philippine Coconut Authority, the Sugar Regulatory
Administration, the Department of Agrarian Reform, the Department of Environment
and Natural Resources, the Mines and Geosciences Bureau, the Laguna Lake
Development Authority, the Department of the Interior and Local Government, the
Local Government Units, the Land Registration Authority, and the Department of
Human Settlements and Urban Development shall facilitate the release of the
required housing-related permits, licenses, certifications and tax exemptions/rulings
in accordance with the Republic Act 11032 or an Act Promoting Ease of Doing
Business and Efficient Delivery of Government Services Amending for the Purpose
Republic Act 2485 Otherwise Known as the Anti0Red Tape Act of 2007 and Other
Purposes and Executive Order No. 45 (S. 2001).

In case the responsible officers of the agencies concerned fail or refuse to dispose
of the application within the periods prescribed under RA 11032, the applicable
administrative criminal liability as stated in Section 22 of RA 11032 shall be imposed.


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SESSSRSEESRRERR SESS

ROBSUVAAETRESBSS

All the incentives enumerated under Section 20 of Republic Act 10884 or an Act
Strengthening the Balanced Housing Development Program, Amending for the
Purpose Republic Act No. 7279, as Amended, Otherwise known as the Urban
Development and Housing Act if 1992 shall be extended to the Private sector
engaged in socialized and low-cost housing development including the construction
and estate management of public rental housing.

The participation of owners and/or developers in any of the component Programs of
NHDPFA shall be treated as one of the manners of compliance to the balanced
housing requirements subject to the conditions set forth under RA 10884.

SECTION 12. Collection Efficiency. - In order to improve collection efficiency,
the NHA, SHFC, and NHMFC shall have the authority to foreclose mortgages, and/or
evict beneficiaries in accordance with existing laws.

Section 13. Implementing Rules and Regulations. - The DHSUD shall
promulgate rules and regulations necessary for the implementation of this Act.

Section 14, Repealing Clause. - All laws, decrees, executive orders,
proclamations, rules and regulations and the issuances, or parts thereof which are
inconsistent with the provisions of this Act, are hereby repealed, amended or
modified accordingly.

Section 15. Penal Clause. - Any person who violates any provision of this Act
shall be imposed the applicable administrative and criminal liability as stated in
Section 22 of RA 11032 or the Ease of Doing Business and Government Service
Delivery Act of 2018.

Section 16. Separability Clause. - if for any reason, any provision of this Act is
declared invalid or unconstitutional, the remaining proviscions not affected thereby
shall continue to be in full force and effect.

Section 17. Effectivity Clause. - This Act shall take effect fifteen (15) days after
its complete publication in at least two (2) national newspapers of General
Circulation.

Approved,