Republic of The Philippines
HOUSE OF REPRESENTATIVES ae Mey

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Quezon City, Metro Manila A RECEIVED
© oye, OCT 19 200

SEVENTEENTH CONGRESS
Second Regular Session

HOUSE BILL No, 6624

Introduced by: Rep Josephine Y. Ramirez-Sato

EXPLANATORY NOTE

Having a component city is a catalyst for change and development in a province. Its
character complements each other and carries economic gains in adjacent municipalities.
Having at least one component city in a province is instrumental in boosting socio-economic
development in the area. It promotes commerce, improved delivery of services, tourism and
alternative sources of income to the communities.

This bill seeks to create a component city in provinces that does not have an existing
component city. Based on the Philippine Statistics Authority, there are thirty-two (32)
provinces without a component city that will benefit from this legislation. Of the qualified
Provinces, sixteen (16) are in Luzon, six (6) in Visayas, and ten (10) in Mindanao.

_To function and become a city is more of a character rather than just financial,
population or land requirement. Even a small municipality can qualify as a city when it can
perform and has the character and functions of a city. It can even excel further if the qualified
municipality is the center of commerce to neighboring towns, provides services and
maintains supply of goods.

The bill also aims to boost development by helping a qualified municipality in
province to become a component city. It is a supportive and proactive bill seeking to attract
more investments to support the municipalities reach their financial targets rather than wait

for a municipality to develop on its own, slowly reaching the required financial quota.


Our government needs to support this bill because it does not only promote inclusive
growth, it can also be an investment target by private companies and financial institutions
knowing that the municipality is qualified and up for conversion. Their planned investment or
expansion will surely hit the mark knowing the area will be developed to a city.

Urban development today cannot just be classified simply on number of population,
land area and income. A growing and functional city is defined by its purpose and
development role to its constituents and nearby municipalities in the aspects including
business, tourism, transportation, food security, peace and order, disaster response, and social
services. The people and their commitment to service is also integral to city development.
The proper legislation and support is much needed to attain these objectives.

In view of the foregoing, the approval of this bill is earnestly sought

HON/JOS! INE Y. IREZ-SATO
Lonf Distrff of Occider lindoro


Republic of The Philippines
HOUSE OF REPRESENTATIVES
Quezon City, Metro Manila

SEVENTEENTH CONGRESS
Second Regular Session

HOUSE BILL No._ 6624

Introduced by: Rep Josephine Y. Ramirez-Sato

AN ACT ALLOWING THE CONVERSION OF A MUNICIPALITY INTO A
COMPONENT CITY IN A PROVINCE THAT DOES NOT HAVE AN EXISTING
COMPONENT CITY, AMENDING FOR THE PURPOSE SECTION 450 OF RA
7160, AS AMENDED BY RA 9009, 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 450 of Republic Act No. 7160 as amended by Republic Act No.
9009, otherwise known as the Local Government Code of 1991 is hereby further amended
to read as follows:

“SECTION 450. Requisites for Creation- (a) A municipality or cluster of
barangays may be converted into a component city if it has a locally generated average
income, as certified by the Department of Finance, of at least One hundred million pesos
(P100,000,000.00), for the last two (2) consecutive years based on [2000] 2012 constant
prices, and if it has either of the following requisites:

(i) _ A contiguous territory of at least one hundred (100) square kilometers, as
certified by the Land Management Bureau; or


(ii) A population of not less than one hundred fifty thousand (150,000)

inhabitants, as certified by the National Statistics Office.

THE REQUISITES FOR CREATION PRESCRIBED HEREIN SHALL
NOT APPLY IF THE MUNICIPALITY BELONGS TO A PROVINCE THAT
DOES NOT HAVE AN EXISTING COMPONENT CITY, PROVIDED THAT THE
MUNICIPALITY SHALL QUALIFY WITH THE REQUIREMENTS AND
CHARACTER OF A CITY AS PROVIDED UNDER THIS BILL.

SECTION 2. Prioritization.- For provinces without an existing component city, 1" class
municipalities with the highest locally generated average annual income will be
prioritized, as certified by the Department of Finance. If no 1" class municipality, the
highest annual income for the 2™ class municipality shall be the candidate.

In provinces with no 1* or 2™ class municipalities, the Capital Municipality, upon
meeting the indicators, shall be the sole candidate

SECTION 3, Requirements.- After determination of the candidate municipality, it shall
undergo compliance with the following requirements and characteristics of a city. It is the
Department of the Interior and Local Government (DILG) who shall evaluate and issue

the certificate of compliance.

The following requirements and categories for compliance are:

(a) Aside from the mandatory offices in its charter, the following local government
offices, including personnel should be established. Any 3 out of the 4 should be
established. (3/4)

1. DRRM Office
Local Economic and Investment Promotion Office
Tourism Office

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Environment Office

(b) Should have at least 3 out of the 6 plans for submission. (3/6)
1. 10-Year Solid Waste Management Plan
2. Local Shelter Plan


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Peace and Order and Public Safety Plan
. Comprehensive Land Use Plan and/or Comprehensive Development Plan
Human Resource Management and Development Plan
Gender and Development Plan

(c) Should have established at least 3 out of the 6 Infrastructure for evaluation, (3/6)

1
2:
3.

Central Market
Unified PUV terminal
Solid Waste Facilities (Central MRF, MRF or MRS in barangays, approved
disposal facility/access to approved disposal facility)
Evacuation center
. Road networks (paved roads)
Drug rehabilitation center and/or Special Drug Education Center

(d) Should have at least 3 out of the 6 economic characteristics similar to a city. (3/6)

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High business retention with an approved business and investment
incentive code
Has a central business district
Business friendly
Average revenue growth for the last 3 years is positive
. Local development fund allocation is followed and is disbursed
. High employment density compared to other municipalities in province

SECTION 4. Additional Exemption.- To facilitate the intent of this bill, all

municipaliti

ies that will qualify as potential candidates shall be exempted from the

Personnel Services Limitation upon effectivity of this bill. Such exemption shall be

effective for at most two (2) years or until a municipality within the province has been

converted into a city, whichever comes first.

Ifa candidate municipality qualifies and is subsequently converted into a city, the
exemption in this item shall apply for an additional three (3) years from the date of its

conversion,


SECTION 4. Funding.- The Department of Budget and Management (DBM) shall
allocate funds for the first three (3) years of Internal Revenue Allotment (IRA) of the
newly established component cities. This allocation will be an additional and separate
from the IRA of already existing cities so as to not drastically decrease the allocation for

all cities.

SECTION 5. Effectivity.- This act shall take effect fifteen (15) days after its publication
in the Official Gazette or in a newspaper of general circulation

Approved.