LC EPRESS

Republic of the Philippines f
HOUSE OF REPRESENTATIVES
Quezon City

Eighteenth Congress
First Regular Session

4944
HOUSE BILL NO.

Introduced by Representative JOEY SARTE SALCEDA

AN ACT
ESTABLISHING THE NATIONAL FRAMEWORK FOR WATER RESOUCE
MANAGEMENT AND CREATING THE DEPARTMENT OF WATER RESOURCES
AND THE WATER REGULATORY COMMISSION, AND FOR OTHER PURPOSES

EXPLANATORY NOTE

1. Department of Water Resources

A 2015 World Resources Institute study warned that the Philippines will likely
experience a "severe water shortage" in the year 2040. This is not surprising given the fact that
in the World Bank’s 2003 Philippine Environment Monitor, it was already reported that as of
year 2000, compared to other countries in Southeast Asia, the Philippines already ranked 2nd
to the lowest in terms on annual renewable water resources per capita.

Climate change hazards (rainfall variability, increasing temperatures, rising sea level
and more extreme weather) which pose major risks to water resources and a growing
population will further aggravate this situation. PAGASA’s downscaled climate projections
have shown that the country’s water resources will be one of the most adversely affected by
climate hazards. This highlights the urgent need to properly plan for and manage our finite
water resources in order to meet the increasing demand of a growing population, continuing
economic development amidst many competing users.

The outcome document of the Rio +20 Earth Summit, entitled “The Future that We
Want” emphasized just how important water is by stating that that “Water is at the Core of
Sustainable Development”. It is acknowledged that there can be no development without water,
there can be no life without water. Or to put it more succinctly, Water is Life!

Access to safe and potable drinking water as a basic right was recognized by the United
‘Nations as one of its Millennium Development Goals (MDGs) In July 28,2010. 122 countries
formally acknowledged this "right to water” in a UN General Assembly. Barely two months
later, the ITN Human Rights Council adopted a binding resolution recognizing that the human
right to water and sanitation is part of the right to adequate standard of living.


Yet, in the Philippines, as of 2015, more than 12 million people still get water from
unsafe sources. More than four million people do not have access to sanitary toilets and thus,
defecate openly. An additional two million are limited to unimproved sanitation facilities.

As pointed out by the Philippine Water Supply and Sanitation Master Plan (PWSSMP),
it is imperative that these present problems are addressed considering the adverse impacts that
unsafe water supply and polluted waters have on people’s health, and the economy.

Based on the 5-year data from the National Epidemiology Center of the Department of
Health, 31% of illnesses was water related.' It has been estimated that the economic impacts
of poor sanitation to be in the order of US$ 1.4 billion, equivalent to about 1.5% of GDP in
2005 with health impacts accounting for 72% at US$1B. Episodes of red tides and fish kills in
different parts of the country highlight the extent of the losses of livelihood of our fisherfolks
from polluted waters. And the recent closure of Boracay due to severely polluted waters
(mainly coming from sewage) also highlights the adverse impacts of dirty waters on the tourism
industry, which is a major contributor to economic growth.

Unfortunately, the management of the country’s water resources remains fragmented
and uncoordinated with over 30 government units and agencies at national and local levels
implementing separate and disharmonized policies, plans and programs to develop and operate
water facilities and infrastructure for various uses, regulate water use and set tariffs, and
monitor water-related parameters. This continued overlapping and fragmented management
and regulation of water resources and services hinders the enactment and implementation of a
comprehensive, integrated and doable long-term solution to address keener competition,
imbalance resource utilization and conflict of interests among water users, especially in areas
already identified as water-stressed. It puts at risk the attainment of the SDG target of universal
‘access to safe water supply and improved sanitation by 2030.

There is an urgent need for an integrated and coordinated planning and implementation
of programs and projects that promote synchronized, sustainable and science-based
management of the country’s water resources that would address the imbalance in water
resource utilization, reduced water availability, declining water quality, recurrent flooding, and
other water-related issues in many parts of the country. This cannot be achieved without
addressing the fundamental governance and institutional issues of the sector.

Consistent with the various studies, plans, and initiatives conducted in the past two (2)
decades which have supported the need for the establishment of a strong apex body for the
water resources sector, the Philippine Development Plan (2017-2022) identified as a primary
strategy for the water supply, sewerage and sanitation sub-sector the creation of an apex body
for water resources management and the formulation of masterplans to address the fragmented
structure and that foster coordinated efforts across the country. This actually holds true for the
entire water sector.

‘An apex body for the water sector is critically needed in order to have a single entity
that will be in charge of the overall planning, programming, policy formulation, and
management for the sector. It will serve as the sector’s champion and ensure that subsector
policies and plans are aligned with the overall Sector Master Plan. It will coordinate, monitor
and evaluate sector performance and take appropriate action as needed. It will conduct

* excluding Timor Leste and Brunei who were not included in the study


extensive and regular hydrological studies/analyses which are very vital for water planning and
allocation purposes.

It is thus proposed that a Department of Water Resources be created to ensure that
Filipinos benefit from this fundamental human right and that this finite resource will be
sustained.

IL. Water Regulatory Commission

Based on the 2015 Family Income and Expenditure Survey of the Philippine Statistics
Office, 87.2% of the population has access to water from formal providers, but only 43.6%
have piped connection, 11.2% use communal faucets and the remaining 45.2% rely on point
sources. The remaining 12.8% of the population use various means of getting water including
fetching water from rivers, digging shallow wells or buying vended water. On wastewater
treatment services, coverage is dismal. Roughly 4% of the population is connected to sewerage
systems. It is only in Metro Manila where the service providers, in this case private
concessionaires, have a program for septage management services and future plans to put in
place improved wastewater treatment collection and treatment services. The inadequate safe
water and wastewater services result to significant economic losses, attributed to health costs,
losses from tourism and fisheries industries. Diarrhea, the most significant waterborne disease,
remains as one of the leading causes of morbidity and mortality in the Philippines, an easily
preventable disease.

The problem is not in access alone; the water supply level of service (i., from point
sources or communal faucets to piped connection) and quality of service (for example
achieving 24/7 supply, adequate pressure and drinking water quality) must be improved
considerably also.

While there are many facets to the problem, poor economic regulation has been
identified as a critical structural weakness in the sector. Because of the lack of or poor
enforcement of economic regulations, water utilities are not compelled to expand coverage or
improve quality of service, tariffs are not set rationally, operations are not efficient, and few
service providers are financially viable. The inability of the formal service providers to expand
coverage encouraged “work-around” solutions that eventually aggravated the problem
including spawning of many small-scale water service providers. Based on the nationwide
registry of water service providers’, there is an estimated 23,603 water service providers from
1,451 municipalities and cities in the Philippines, 90% of which have connections of less than
5,000. Hence, by and large there are no economies of scale resulting to inefficiencies and
inherent limitations for growth.

In the Philippine context poor economic regulation is a result of fragmentation; there
are several agencies doing economic regulation, (e.g, LWUA, MWSS, LGUs, NWRB,
TIEZA). Apart from NWRB, regulators have conflicts of interest in their dual role as financier,
as in the case of LWUA or as direct service providers, as in the case of municipal or city
‘governments thus effectively practicing self-regulation.

This bill also intends to address the issue of fragmentation through the rationalization
of the economic and administrative regulation of water utilities through an independent, quasi-

2 The “Listahang Tubig” managed and implemented by the National Water Regulatory Board


judicial body called the Water Regulatory Commission. Among its functions will be to enforce
service coverage and quality of performance targets, toward the objective of providing every
Filipino safe water supply and adequate wastewater services.

The immediate passage of this bill is earnestly sought.

JOEY SARTE SALCEDA


Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City

Eighteenth Congress
First Regular Session

944
HOUSE BILL NO.

Introduced by Representative JOEY SARTE SALCEDA

AN ACT
ESTABLISHING THE NATIONAL FRAMEWORK FOR WATER RESOUCE
MANAGEMENT AND CREATING THE DEPARTMENT OF WATER RESOURCES
AND THE WATER REGULATORY COMMISSION, AND FOR OTHER PURPOSES

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

CHAPTERI
GENERAL PROVISIONS

SECTION 1. Short Title. — This Act shall be known as the National Water Act of 2019.

SEC. 2. Declaration of Policy. — It is hereby declared the policy of the State to ensure
the provision of safe, adequate, affordable and sustainable water supply and improved
sanitation services, while maintaining the protection, preservation and revival of the quality of
the country’s water resources and ecological balance. In pursuit of this policy, this Act shall
have a principal objective of ensuring and accelerating universal access to water supply and
sanitation services, in a regulatory regime that encourages responsible private sector
participation and involvement, and fosters and prioritizes infrastructure and public works
which adopt innovative solutions and international best practices to address the challenges of

climate change.

SEC. 3. Definition of Terms. ~ For purposes of this Act, the following terms are hereby
defined


(a) Bulk water suppliers shall refer to any entity, natural or juridical, whether public or
private, supplying or intending to supply large quantities of raw or treated water to
buyers who will use it for own consumption, such as industrial companies, or for retail
distribution to consumers, such as Water Districts or subdivisions managing their own
distribution network

(b) Commission shall mean the Water Regulatory Commission.

(c) Department refers to the Department of Water Resources Management (DWRM).

(d) Flood Control refers to methods, acts and protocols to be observed in order to prevent
and reduce the detrimental and catastrophic effects of flood waters which include
sediment-laden or turbid flows, hyper-concentrated flows or debris flows.

(e) Flood Risk Management (FRM) refers to such acts of defining and determining the
appropriate methods, acts and protocols aimed at preventing and reducing the risk of
incurring loss of both life and property due to flood waters. Flood risk management
consists of a cycle of prevention, mitigation, adaptation, preparedness and early
warning, and, finally response and recovery. The elements of FRM include: integrating
land-use planning, coastal zone management into water management; adopting a
holistic approach so that FRM is part of wider risk or multi-hazard management
(earthquake, landslides, storm surge, etc.); managing risk and uncertainty as a whole so
it is not only hydrological uncertainties but also social, economic and political
uncertainties in view of the human behavior and cultural dimensions of FRM.

(f) Gender Equality refers to the principle asserting the equality of men and women and
their right to enjoy equal conditions realizing their full human potentials to contribute
to and benefit from the results of development, and with the State recognizing that all
human beings are free and equal in dignity and rights. 5

(g) Infrastructure and public works as used in this Act should be read to apply only to
wholly or primarily water-related projects and shall not be read to incorporate projects
which would not otherwise fall within the purview of the objectives, power and duties
of the Department.

(h) JWRM refers to the Integrated Water Resource Management or to a systematic,
collaborative and multi-stakeholder process, which promotes the coordinated
development and management of water, land and related resources within geophysical
boundaries in order to maximize the resultant economic and social welfare in an
equitable manner and without compromising the sustainability of vital ecosystems.

(i) Levels of water supply service shall mean as follows:


1. Level I (point source) ~ a protected well or a developed spring with an outlet but
without any distribution system, generally adaptable for rural and upland areas
where the houses are thinly scattered. A Level | facility usually serves an average
of 15 households.

2. Level II (communal faucet system or stand posts) — a system composed of a water
source, a reservoir, a piped distribution network, and communal faucets. Usually,
‘one faucet serves 4 to 6 households. Generally suitable for rural and urban fringe
areas where houses are clustered densely to justify a simple piped system.

3. Level III (waterworks system or individual house connections) — a system with a
water source, a reservoir, a piped distribution network and household taps. This is
generally suited for densely populated urban areas.

Gj) License shall mean the Water Supply and/or Sanitation Services Operating License that
the Commission is authorized to grant and issue to Service Providers.

(k) Licensee shall mean the Service Provider to whom a License is granted or issued by the
Commission.

(1) LWUA shall mean the Local Water Utilities Administration created under Presidential
Decree No. 198, as amended.

(m) LGU refers to Local Government Unit or to the territorial and political subdivisions of
the Philippines as defined under the 1987 Constitution of the Philippines, which
includes provinces, cities, municipalities and barangays.

(n) NDRRMC refers to the National Disaster Risk Reduction Management Council

(0) PDP refers to the country’s medium-term development called the Philippine
Development Plan.

(p) Regulatory Units shall refer to the regulatory offices established under Section 5 of this
Act to issue Licenses authorizing the operation of Water Supply and Sanitation
Services; provide, review, determine, fix, and approve water and sewerage tariffs, rates
and charges that Licensees may impose; and exercise such other functions and powers
as may be provided hereunder.

(q) River basin refers to an area of land drained by a stream or body of fixed water and its
tributaries having a common outlet for surface run-off

(1) RBO refers to multi-stakeholder River Basin Organization or to organizations which
plan, coordinate and monitor activities within a river basin cluster.

(s) Sanitation refers to sewage, sanitation and septage management.


(t) Sediment management refers to control of sediment erosion and deposition in rivers,
reservoirs and coastal zones through non-structural and structural measures and control
works,

(u) SDG refers to the United Nation’s sustainable development goals.

(v) Septage refers to sludge produced on individual onsite wastewater disposal systems,
principally septic tanks and cesspools.

(w)“Septage Management” shall refer to the provision of proper collection, treatment and
disposal of septage.

(x) “Service Area” shall refer to the area covered by the water distribution system,
sewerage and septage management services.

(y) “Service Provider” shall refer to any entity, natural or juridical, whether private or
public, providing or intending to provide levels II & III water supply, including bulk
water suppliers; sewerage; and/or septage treatment and disposal services for
domestic/residential, industrial or commercial use.

(2) Sewage refers to water-carried waste in solution or suspension including sanitary waste
(waste products of normal living), commercial waste, industrial waste, agricultural
waste and surface runoff conveyed by a sewerage system for treatment or disposal. For
purpose of this Act, the definition of septage shall be included in the use of sewage.

(aa) Sewerage refers to any system or network of sanitary pipelines, ditches, channels or
conduits including pumping stations, lift stations and force mains, service connections
including other constructions, devices or appliances appurtenant thereof, which
includes the collection, sanitary piping transport, pumping and treatment of water-borne
human or animal waste removed from residences, buildings, institutions and industrial
and commercial establishments to point of sewage treatment plant disposal.

(bb) Sewers refer to pipes or such other works or structures which are built and constructed
to treat, carry, transport and dispose sewage.

(cc) Social inclusion refers to the process of improving the terms for disadvantaged
individuals and groups to take part in society.

(dd) Tariffs refer to such amounts which may be charged by licensees of water supply
and/or sanitation services for their services based on principles, standards and
guidelines established by the Department.

(ee) Water Demand Management (WDM) refers to any method — whether technical,
economic, administrative, financial, or social — that will accomplish one (or more) of
the following things:


1. reduce the quantity or quality of water required to accomplish a specific task;

2. adjust the nature of the task or the way it is undertaken so that it can be
accomplished with less water or with lower quality water;

3. reduce the loss in quantity or quality of water as it flows from source through use
to disposal;

4. shift the timing of use from peak to off-peak periods; and

5, increase the ability of the water system to continue to serve society during times
when water is in short supply.

(ff) “Water District” shall refer to. government-owned and controlled corporations
organized under Presidential Decree No. 198, as amended, created primarily to acquire,
install, operate, maintain and improve water supply and distribution systems for
domestic, industrial and municipal uses of residents and to provide, maintain and
operate waste water collection, treatment and disposal facilities within the boundaries
of the district.

(gg) Water pollution - means any alteration of the physical, chemical or biological or
radiological properties of a water body resulting in the impairment of its purity or
quality

(hh) Water Resources refers to water under the grounds (groundwater), water above the
ground (surface water, run-offs, floods, stormwater and urban drainage, and treated
wastewater), water in the atmosphere (rainwater) and the waters of the sea within the
territorial jurisdiction of the Philippines.

(ii) Water Resources Regions refer to the contiguous clusters of river basins which are
grouped together according to the hydrological boundaries, physiographic features and
homogeneity in climate for administrative purposes under the Department.

(ij) Water Resources Regional Offices (WRROs) refer to the field office of the
Department which are to be established in accordance with the identified water
resources regions in the country.

(kk) Water Service Providers (WSPs) refer to the water districts, any LGU-run water
utility, BWSA, RWSA, cooperatives and private sector who provides water supply
services to any given area.

(ll) Water supply service refers to any activity comprising Levels I, II and III water supply
including bulk suppliers, suppliers to subdivisions and other water service providers.

CHAPTER IL


THE DEPARTMENT OF WATER RESOURCES MANAGEMENT

SEC. 4. The Department of Water Resources Management, ~ There is hereby created
and established the Department of Water Resources Management, hereinafter referred to as the
“Department,” which shall be organized within one hundred eighty (180) days after the
effectivity of this Act. The Department shall have the organizational structure, powers and

functions needed to perform its mandate as provided in this Chapter.

SEC. 5. Mandate of the Department. — The Department shall be primary agency
responsible for the comprehensive and integrated planning, policy formulation and
management of the ownership, appropriation, utilization, exploitation, development,
conservation and protection of water resources in the Philippines to ensure the optimal use
thereof for domestic and municipal water supply, sanitation, irrigation, hydropower, industry,
navigation, flood management, recreation and fisheries/aquaculture.

The Department shall also be the primary agency responsible for the planning and
policy formulation towards the attainment of universal access to safe, adequate, affordable, and
sustainable water supply, and improved sanitation services for all Filipinos.

SEC. 6. Guiding Principles. ~ In the pursuit of its mandate, the Department shall be
guided by the following key principles:

(a) Good water governance for water security and sufficiency across all levels of
governance (national, sub-national, local, river basin and even global), societal actors
(national government, local government, non-government organizations, private
organizations, individuals, etc), and various sectors (water supply, irrigation, fisheries,
hydropower, navigation, ecosystem services, flood management, climate change,
recreation, etc.) shall entail publicly transparent, socially accountable and multi-
stakeholder participatory — water policy, planning, management and decision-making
processes.

(b) IWRM shall be adopted as the basic framework which is the coordinated development
and management of water, land and related resources within hydrological boundaries,
to optimize economic and social welfare, without compromising the sustainability of
vital ecosystems. IWRM includes an enabling environment (utilizing proper policies
and legal instruments), institutional framework (for effective implementation,
participatory and collaborative water policy and management decisions), and


management instruments (for efficient use of updated and accurate data, science-based
decision support system, proper IEC, assessment and allocations tools, regulatory
functions, etc).

(c) Recognizing that all river basins have their unique characteristics, (physical, socio
cultural and others) water management should be done at river-basin level, involving
all the stakeholders at that particular river basin.

(d) Integrated and accurate data collection and analysis and the use of scientific decision
support systems for water resources management including flood modeling and
warning system are essential for an effective, efficient and sustainable water resources
management system.

(e) Development of water resources shall consider mitigation of water-related hazards and
climate change adaptation strategies.

(£) Access to safe water supply and improved sanitation is a human right that needs to be
fulfilled and protected.

SEC 7. Objectives of the Department. —

(a) Strengthen and coordinate integrated water resources management planning and policy
making to ensure sustainable and fair allocation and efficient use of water resources
among competing uses and users;

(b) Ensure that integrated water resources management is strongly coordinated with land
use/cover, coastal zone and multi-hazard planning and management;

(c) Sustainably develop and manage water resources toward water security taking into
consideration water, land, and related resources with the objective of increasing water
dependability for different uses, optimizing economic benefits and social welfare
without compromising the sustainability of vital environmental systems;

(d) Strengthen and coordinate policy making and planning towards ensuring availability of
water for food security and energy security, as well as towards protection of
communities and environments from/against flood and other water induced hazards
(includes sediment hazards);

(e) Promote and adopt water demand management as a national policy to ensure that water
is optimized, that water efficiency and conservation become a way of life, that the
recycling and reuse of water and treated wastewater are widely practiced, that water is
properly priced to encourage efficient use and conservation and that rainwater, flood
waters, and run-offs are captured/harvested, stored and treated for future use, and


(f) Prioritize and seek the immediate attainment of universal access to safe, adequate,
affordable and sustainable water supply and improved sanitation services for all
Filipinos in a manner consistent with the protection, preservation and revival of the
quality of the country’s water resources, and to adopt all needed measures to advance
the right of the people to a balanced and healthful ecology in accord with the rhythm
and harmony of nature.

(g) Ensure water resources development and conservation is participatory, involving
planners, policymakers and users including community members at all levels;

(h) Develop a standardized pricing framework for water use that accounts for
environmental externalities; and

(i) To ensure that all sources of water, including surface water, groundwater, rainwater and
floodwater, are monitored, conserved and managed for productive use and the resulting
wastewater is managed properly and reused and, finally responsibly disposed of
following approved environmental standards

SEC. 8. Powers and Duties of the Department. ~ The Department shall have the
following powers and duties:

I. Policymaking and Planning

(a) Ensure that Integrated Water Resources Management is adopted as the strategic
framework for water management policymaking and planning in the country and
coordinate the implementation, promotion, revision and enhancement of IWRM plans;

(b) Formulate policies, strategies, and targets in coordination with other relevant entities to
meet the goals and objectives for water supply and sanitation, water quality, irrigation,
hydropower, flood control, stormwater, and urban drainage. Such policies shall, among,
other things, integrate the issues of water and sanitation, food security, energy,
environment and flood control;

(c) Develop and regularly update, in consultation with other agencies and stakeholders, the
National Water Resources Management Framework Plan following the IWRM
framework, including the review and integration of land use plan to this water resources
plan;

(a) Undertake river basin survey, inventory and appraisal of water and related resources
and develop comprehensive basin-wide plans of storage, retardation and control to

maximize conservation and multipurpose use of water in the basin;


(e) Conduct continuing hydrologic and hydrometeorological surveys and studies of the
country’s renewable water supply, establish, operate and maintain observation
station networks with a view towards formulating long-term policies to balance
the sustainability and optimal multiple use of water resources, defining the hydrologic
boundaries of basins of the existing water supply sources and developing or updating
and implementing countrywide comprehensive basin-wide master plans;

(f) Strengthen and coordinate policy making and planning for flood management,
integrated with stormwater/urban drainage and appropriate retention or retarding basins
in order to plan against, prevent, and minimize the detrimental and catastrophic effects
of flooding;

(g) Assist and provide the National Economic and Development Authority (NEDA) with
required data and input from and for the water sector in the formulation of the country’s
short-term and long-term strategic development plans, and actions and recommend the
adoption of general policies and guidelines for water resources development to the
NEDA;

(h) Review, approve and provide oversight over all water-related development plans and
programs of any agency within the context of the National Water Resource

Management Framework Plan and overall national plans and program;

Develop and implement in coordination with other relevant agencies, effective codes,
standards, benchmarks, and reasonable guidelines to ensure the safety of all public, and
private water structures in the country and assure efficiency and proper quality in the
construction of water, sanitation, irrigation, hydropower, flood control and drainage
infrastructure,

G

Ensure that gender equality, social inclusion, climate resiliency and disaster risk
reduction are integrated into any water resources management planning, policy making,
and the design and construction of water infrastructure;

(k) Ensure that the planning and design of water infrastructure considers the highest
efficiency and most appropriate quality, in accordance with national development
objectives;

(1) Review existing guidelines appropriate for Private Sector Participation in the water
sector and make needed recommendations to the PPP Center, NEDA and other
concerned agencies to promote and enable more PPPs in the sector;

(m)Effect inter-sectoral, inter-agency, and inter-departmental coordination on all aspects

of data gathering for water resources development planning and compel submissions of

9


statistics and data on water management with the aim of operationalizing the integrated
approach to water resources management;

(n) Formulate and develop policies to promote universal access to safe, adequate,
affordable, and sustainable water supply, and improved sanitation services for all
Filipinos;

(0) Shall be the lead agency and, consequently, ensure the effective implementation of all
the provisions of R.A. 9275, known as the Clean Water Act of the Philippines;

(p) Issue and promulgate rules, regulations and guidelines as may be necessary to
implement and enforce its powers and functions under this Act; and

(q) Promote State participation in information sharing and education around best practices
in the international movement to achieve universal access to safe water and improved
sanitation and the integration of water, energy, food security and environment.

IL Resource Regulation

(a) Manage, protect, and preserve the country’s water resources to ensure the optimal use
thereof for domestic water supply, sanitation, irrigation, hydropower, navigation, flood
control, and recreation, including the enhancement and maintenance of water quality,
conservation of watershed, control of water pollution and environmental restoration,
without compromising the natural ecosystem functions and services;

(b) Regulate and control the utilization, abstraction, diversion and development of water
resources, taking in consideration its equitable distribution among competing demands
and determine the standards of beneficial and priority uses of water in times of crisis
and national emergencies;

(c) Ensure and oversee the implementation of Presidential Decree 1067 or the Water Code
of the Philippines;

(d) Determine, adjudicate, and grant water rights amending, for this purpose, Republic Act
No. 2152, and other laws relating to the appropriation and utilization of surface and
‘groundwater,

(e) Formulate, promulgate and enforce rules and regulations for the development and
optimum use of water resources and its administration and management, including
coherent water protocols, operating rules of all existing and future water infrastructure;
general criteria, methods and standards for basic data collection and project
identification, formulation and planning, and appropriate sanctions to be imposed for

non-compliance;


(f) Regularly review regulations prescribed by any government agency pertaining to water
use, exploitation, development, conservation or protection of waters, water resources,
and watershed or basin areas;

(g) Impose fees or charges, as may be deemed necessary for water resources conservation
and protection, such as, but not limited to:

i Polluter’s Fee, which shall be based on the net waste load depending on the
wastewater charge formula pursuant to R.A. 9275 or the Clean Water Act, and,

ii, Raw water price, which shall take into account, among others, the scarcity of
water, and shall be determined by the Department;

(h) Empower or authorize LGUs to impose the fees or charges within their respective
jurisdiction;

(i) Collect, regularly update, monitor and analyze water resources data including
climatology, hydrologic and other water-related data;

(j) Establish, operate and maintain observation station networks and a centralized water
resources data center necessary for the scientific survey and appraisal of surface and
groundwater potentials of the country and determine the annual renewable water
available per water resources region;

(k) Develop and continuously update a computerized decision support system that
incorporates data management system (acquisition and database), model base (physical,
design, planning and decision models), and user-friendly interface (graphical and
visualization tools);

it}

Conduct and/or promote special studies and researches on water economics and other
water resources development and management issues and concerns (i.e. climate change,
weather modification, flood monitoring and modeling, environmental quality,
desalination, ete.); and

(m)Initiate and maintain public awareness, information and build capacities for
knowledgeable participation in water resources management at national and river-basin
level.

MIL Adi
(a) Develop guidelines including rules of partnership among the Department, field offices

istration and Management

of national government agencies, LGUs and other stakeholders, and facilitate the
establishment of multi-stakeholder river basin organizations (RBOs) per river basin and
strengthen and support existing RBOs and monitor their activities;

a


(b) Develop materials for capacity building and training on RBO development and conduct
training and workshops for prospective river basins;

(c) Authorize its representatives or any deputized agent to enter any property of public
dominion or any private land, building or enclave, whether inhabited or not, for the
purpose of conducting hydrologic surveys and investigations, including assessing and
evaluating the conditions of water facilities installed and determining compliance with
water laws and standards;

(d) Provide technical assistance to water users including but not limited to farmers,
communities, LGUs and other water service providers (WSP) whether directly or in
coordination with other agencies on all aspects of integrated water resources
management,

(e) Respond to consumer complaint/s, and ensure the adequate promotion of consumer
interests,

(f) Deputize agents, whether from the public or private sector, to assist in the performance
of any of the powers and functions of the Department;

(g) Appoint, hire and maintain adequate staff and personnel, advisers and/or consultants

with suitable qualifications and experience, as necessary.

IV. Coordination

(a) Coordinate and integrate, on a sound and logical basis, water resources development
activities of the country within the context of national plans and policies for social and
economic development;

(b) Coordinate with other government agencies, universities and private professional
groups for all aspects of data gathering, the conduct of special studies and research on
all related aspects of water resources management and development such as climate
change, environmental quality, desalination, and the development of operating
strategies, procedures, and protocols with accompanying computerized decision tools
for major water facilities;

(c) Coordinate with the concerned and relevant agencies engaged in flood control, flood
risk management and drought risk management;

(d) Proactively coordinate with Local Government Units to ensure the integration of water
resources development plans into their comprehensive land use plans (CLUPS),
Comprehensive Development Plans (CDPs) or Provincial Physical Framework and
Development Plan (PPFDP).


(e) Exercise such other powers and functions necessary or incidental to the effective
administration and management of the country’s water resources, and,

(f) Carry out such other functions as the President may from time to time assign to the
Department consistent with the aims and provisions of this Act.

SEC. 9. Secretary of the Department of Water Resources Management. ~ The authority
and responsibility for the exercise of the mandate of the Department and for the discharge of
its powers and functions shall be vested in the Secretary of the Department of Water Resources,
hereinafter referred to as the Secretary, who shall:

(a) Advise the President on the promulgation of executive or administrative orders,
regulations, proclamations and other issuances relative to matters under the jurisdiction
of the Department;

(b) Establish the policies and standards for the operation of the Department pursuant to the
President's guidelines;

(c) Promulgate rules and regulations necessary to carry out Department objectives, policies
and functions;

(d) Exercise supervision and control over all Bureaus and Offices under the Department,

(©) Supervise all attached agencies and corporations in accordance with law;

(f) Represent the Department in contracts, awards, and the like;

(g) As deemed appropriate by the Secretary, delegate authority for the performance of any
power or function, as defined herein to officials and employees under his direction; and

(h) Perform such other duties and responsibilities as may be provided by law.

‘No person shall be appointed Secretary unless he possesses extensive knowledge of
public administration and has a minimum of ten (10) years’ experience in the administration
of water, sanitation, irrigation, flood control and drainage programs preferably in a public
agency.

SEC. 10. Office of the Secretary. — The Office of the Secretary shall be composed of
the Secretary and his immediate staff.

SEC. 11. Undersecretaries. ~ The Secretary shall be assisted by not more than five (5)

Undersecretaries, who shall be appointed by the President upon the recommendation of the
Secretary namely Undersecretary for Resource Regulation and Governance, Undersecretary

13


for Water for Agriculture and Fisheries, Undersecretary for Resource Development,
Undersecretary for Planning and Policy and Undersecretary for Clean Water Act.

The Secretary is hereby authorized to delineate and assign the respective functional areas of
responsibility of the Undersecretaries: Provided, that such responsibility shall be with respect
to the mandate and objectives of the Department; and Provided further, that no Undersecretary
shall be assigned primarily administrative responsibilities. Within his functional area of
responsibility, an Undersecretary shall have the following functions:

(a) Advise and assist the Secretary in the formulation and implementation of Department

policies, plans, programs and projects;

(b) Supervise all the operational activities of the assigned units for which them

Undersecretary is responsible to the Secretary, and

(c) Perform such other duties and responsibilities as may be assigned or delegated by the

Secretary to promote efficiency and effectiveness in the delivery of public services or

as may be required by law.

‘The Undersecretary for Planning and Policy should be a Career Officer and shall have
primary responsibility, in coordination with the Planning and Policy Service, for advancing
efforts in the pursuit of the ultimate goal of universal access to water supply and sanitation
systems and sustainable management of water resources. The Undersecretary for Planning and
Policy shall also have the primary responsibility for knowledge sharing and advancement of
efforts around the integration of water, energy, environment and food security.

No person shall be appointed Undersecretary unless he possesses a working knowledge
of public administration and has a minimum of seven (7) years’ experience in the
administration of water, sanitation, irrigation, flood control and stormwater drainage,
preferably in a public agency or with legal, financial or financial knowledge of such programs;
provided that only five (5) years” experience shall be required for the Undersecretary to be
assigned for support services.

SEC. 12. Assistant Secretaries. - The Secretary shall be assisted six (6) Assistant
Secretaries appointed by the President of the Philippines upon the recommendation of the
Secretary: one to be responsible for Planning and Policy Service; one for Decision Support
System Service; one for the Regulatory Service; one for the Comptrollership and Financial
‘Management Service; one for the Legal and Legislative Service; and one for the Administrative
and Human Resources Management Service.

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No person shall be appointed Assistant Secretary unless he possesses a working
knowledge of public administration and has a minimum of five (5) years’ experience in the
administration of water, sanitation, irrigation, flood control and stormwater drainage or other

water resources management programs.

SEC. 13. Organizational Structure. — The Department shall be composed of the

following organizational units:

(a) Department Proper consisting of the Office of the Secretary, the Offices of the
Undersecretaries and Assistant Secretaries, the Internal Audit Office, the Public Affairs
Office, the Water Pollution Adjudication Board, the Planning and Policy Service,
Decision Support System Service, Administrative and Human Resources Service,
Legal and Legislative Service, Comptrollership and Financial Management Service,
Resource Regulation Service, and the Water Resources Regional Offices.

(b) The Attached Agencies, namely:

1) The Local Water Utilities Administration, whose mandate, powers and functions
are defined in Presidential Decree No. 198, as amended and which will be
transferred from DPWH and attached to the Department. It shall continue to be
primarily a specialized lending institution for the promotion, development and

financing of local water utilities. In the implementation of its functions, the

Administration shall:

i. prescribe minimum standards and regulations in order to assure acceptable
standards of construction materials and supplies, maintenance, operation,
personnel training, accounting and fiscal practices for local water utilities;

ii, furnish technical assistance and personnel training programs for local water
utilities;

iii. monitor and evaluate local water standards; and

iv. effect system integration, joint investment and operation, district annexation
and de-annexation whenever economically warranted. (as amended by Sec. 22,
PD 768)

2) The Metropolitan Waterworks and Sewerage System (MWSS), whose mandates,
powers and functions are defined by Republic Act No. 6324, as amended, and which
will be transferred from the DPWH and attached to the Department. It will continue
to facilitate the exercise by the concessionaires of its agency powers, carry out
accounting and notification functions, monitor, report, and administer loans and

15


perform related functions in connections with existing projects, manage and dispose
its retained assets and manage and operate the Umiray-Angat Transbasin Project.
3

The Laguna Lake Development Authority, whose mandate, powers and functions
are laid out in Republic Act No. 4850, as amended which will be transferred from
DENR and attached to the Department. It will continue to serve as the lake
management and development authority similar to a multi-stakeholder river basin
organization and will ensure the implementation of the Laguna Lake Master Plan
which will be updated by the Department to ensure alignment with the National
Water Resources Management Framework Plan, Its regulatory powers will however
be taken over by the Department.

4

The Pasig River Rehabilitation Commission, which was created by Executive Order
No. 54, series of 1999, as amended which will be transferred from the Office of the
President and attached to the Department. It will update the existing master plan to
ensure consistency with the National Water Resources Management Master Plan,
regulate easement, integrate and coordinate development programs, abate industrial
wastewater and sewerage dumping and enforce environmental laws, relocate formal
and informal settlers, undertake civil works such as dredging, clearing of structures,
cleaning of the river and its tributaries/esteros, prepare regular Status Report to the
President, coordinate with other national and local government agencies/units and
formulate its own implementing rules and regulations.

5

Any other agency exercising water resources management, conservation and
protection functions which the President may order to be transferred to the
Department;

SEC. 14. Offices, Functions and Personnel to be Completely Subsumed by the
Department. ~ The following offices with their powers, functions, personnel, applicable funds
and appropriations, records, equipment and property are to be subsumed by the Department:

(a) The National Water Resources Board (NWRB) with all its divisions and sections,
whose mandate, powers and functions are found in Presidential Decree No. 424, as
amended, with the exception of its water utility regulation units and functions under

Presidential Decree No. 1206;

(b) The River Basin Control Office (RBCO) of the DENR whose mandate, powers and
functions are found in Executive Order No. 510 and Executive Order No. 816, as
amended;

16


(c) The Manila Bay Coordinating Office (MBCO) of the DENR which was created by
virtue of DENR Special Order 2011-01 to coordinate the efforts of the 14 national
agencies covered by the Mandamus Order of the Supreme Court to rehabilitate Manila
Bay;

(d) The flood management planning and sediment management function of the Flood
Control Management Cluster of the DPWH;

(e) The Water Supply and Sanitation Unit of the DILG; and

(f) The Water Quality Management Section of the EMB of the DENR.

SEC. 15. Functions to be Transferred to the Department. ~ The functions of the
following agencies/bureaus/units shall be transferred to Department of Water Resources
Management:

(a) The function of the Mines and Geosciences Bureau (MGB) of the DENR to conduct
hydrological surveys and groundwater mapping;

(b) The conduct of hydrological surveys monitoring of stream flow and other water data
collection function of the Bureau of Design and Bureau of Research and Standards of
the DPWH;

(c) The irrigation development planning and secondary water availability investigation
function of the National Irrigation Administration (NIA) and Bureau of Soils and Water
Management of the Department of Agriculture (DA);

(d) The formulation of plans for the proper management, development and utilization of
aquatic resources of the Bureau of Fisheries and Aquatic Resources of DA

(ce) The protection and conservation of natural wetlands such as lakes, marshes, swamps of
the Biodiversity Management Bureau of the DENR; and

(f) Planning, programming, administration, monitoring, management of the NSSMP by the
DPWH.

SEC. 16. Planning and Policy Service. — The Planning and Policy Service is hereby
created to provide the Department with the capability to undertake water infrastructure
development planning and programming. For this purpose, it shall have the following
functions:

(a) Advise the Secretary on all matters relating to water resources planning;
(b) Assist the Undersecretary for Planning and Policy on all matters related to the specific
functions of the position;

v7


(c) Formulate strategies and priorities for water resources management and development
consistent with national development objectives and initiate or undertake relevant
surveys for development planning;

(d) Develop and regularly update a comprehensive and integrated National Water
Resources Management Framework Plan and ensure its integration into existing land
use plans;

(e) Coordinate river-basin planning following the integrated water resources management
framework and the river-basin approach;

(f) Formulate or update existing River Basin Master (or comprehensive) Plans which
includes all aspects of water management and development such as water supply and
sanitation, irrigation, flood control and stormwater/urban drainage, drought risk
management, water resource development systems and other public water works
projects, including phasing of implementation;

(g) Based on the river basin master plan, identify priority packages for water infrastructure
development per river basin including water supply, sanitation, irrigation, flood control
and stormwater/urban drainage, drought risk management, water resource development
systems and other public works projects; package project proposals for funding and
prioritize project implementation and the allocation of funds and other resources and
undertake or supervise and evaluate the conduct of feasibility studies and project
preparation thereof;

(h) Evaluate and appraise all regional and inter-regional infrastructure water development
plans and programs as to their feasibility and consistency with approved strategies and
long and medium-term plans;

(i) Initiate regular Department-wide planning exercises and act as the secretariat thereof,

(j) Gather, analyze and organize needed statistical data and information;

(k) Provide technical assistance related to its functions to the other Services, Bureaus and
the Regional Offices as needed;

(1) Conduct of hydrologic and hydraulic surveys and assessments of surface waters;

(m) Develop general criteria and standards on project investigation, formulation, planning;

(n) Develop guidelines and standards on social inclusion in water resources management
and ensure policies, programs and plans are compliant with the gender and development

framework of the government;

18


(0) Closely coordinate with PAGASA for rainfall and other climate data which should be
considered in the planning for water resources development and management and for
various water infrastructure; and

(p) Perform such other related duties and responsibilities as may be assigned or delegated
by the Secretary or as may be required by law.

SEC. 17. Decision Support System Service. - The Decision Support System Service is
hereby created to provide the Department with water resource management tools and
computerized decision support system that incorporates data management system (acquisition
and database) and model base (physical, design, planning and decision models). Additionally,
the services include services related to networking, data management, and information and
knowledge/learning management systems for administrative and non-technical support for the
department. The Service is also responsible for providing the Secretary timely reports on the
status of various Department projects and activities. For this purpose, it shall have the following
functions:
(a) Provide the Secretary needed data and processed information to aid in policy and
management decisions under the mandate of the Department;
(b) Publish available real-time raw water data (through internet) as well as verified or
validated water data (in print and/or electronic form through internet) in tabular and
graphical displays as time series and/or spatial data;

(c) Conduct standard data analysis such as basic statistical analysis, trend analysis, analysis
of runs, cluster analysis, etc. and also publish in print and/or electronic form;

(d) Develop and continuously update water resource management, computerized decision
support system (DSS) that incorporates data management system (acquisition and
database), model base (physical, design, planning and decision models), and user-
friendly interface (graphical and visualization tools). This DSS is composed but not
limited to:

1) ameasurement or data acquisition system;

2) information or database management system;

3) analytical and numerical models for design/planning and decision/evaluation
purposes; and finally

4) auser-friendly interface which includes graphical interface or visualization tools.

(e) The specific models to be developed and maintained should include but not limited to
the following:

19


1) long-term climatologic and weather forecasting model;
2
3
4
B)

watershed models and river-floodplain models;

groundwater models and coupled to surface water models;

flood forecasting model for major rivers;

optimization-simulation and/or management models for watershed conservation,
conjunctive surface and groundwater use, irrigation scheduling, normal and
emergency operations of multipurpose reservoirs; and

6)

(f) Develop and manage the management information system and knowledge systems of

water quality and ecological models,

the Department including the retrieval and processing of monitoring information on all
projects and activities of concern to the Secretary and the web portal and conduct
systems and process engineering, software development, software configuration
management; develop and manage the Department’s corporate database, unified
database for water industry, data warehouse, other water information resources, library
services and document management and archiving services; develop and manage the
Department’s ICT infrastructure and provide ICT related- services to the Department
including computer networking and voice communications services and data exchange;
manage the literacy and training services of the Department on various ICTs, KM tools
and applications including information and knowledge management

(g) Perform such other related duties and responsibilities as may be assigned or delegated
by the Secretary or as may be required by law.

SEC. 18. Administrative and Human Resource Service. - The Administrative and
Human Resource Service is hereby created to provide the Department with services relating to
human resources development, personnel, records, facilities maintenance, medical and dental,
security and property and procurement services. For such purposes, it shall have the following
functions:

(a) Advise the Secretary on all matters relating to internal administration and human
resources management;

(b) Prepare and implement an integrated personnel development plan that shall include
provisions for merit promotions, performance evaluation, job rotation, suggestions and
incentive awards systems, and health and welfare services;


(c) Provide services related to human resources training, education and development
including manpower, career planning and forecasting, and development of indigenous
training materials;

(d) Develop, establish and maintain an efficient and cost-effective property procurement
system and facilities and coordinate or otherwise interface with relevant agencies,
whether government or private, for the purpose of developing or upgrading the system;

(e) Secure and maintain necessary Department facilities, and develop, establish and
maintain an efficient and effective security system covering, among others, personnel,
physical installations, equipment, documents and materials including the conduct of
security investigations;

(£) Coordinate with the appropriate government agencies for a more efficient conduct of
administrative processes;

(g) Develop, establish and maintain an efficient records system;

(h) Provide assistance in its area of specialization to the Department Proper, Bureaus and
Regional and District Offices and, when requested, the government agencies and
corporations attached to the Department; and

(i) Perform such other related duties and responsibilities as may be assigned or delegated
by the Secretary or as may be required by law.

SEC. 19. Legal and Legislative Service. ~ The Legal and Legislative Service is hereby
created to provide the Department with services on such legal affairs as contract letting and
litigation, legal and legislative research, complaints and investigation, legal counselling and
other matters of law. For such purposes, it shall have the following functions:

(a) Advise the Secretary on all matters relating to legal and legislative affairs;

(b) Prepare Department contracts and legal instruments, review and interpret all contracts
and agreements entered into by the Department and evaluate all legal proposals,

(c) Conduct administrative investigation as well as the review of administrative charges
against officers and employees of the Department;

(d) Exercise functional jurisdiction over the legal staffs of Regional Offices;

(c) Provide legal assistance to the Department Proper, the Bureaus and Regional Offices
and when requested, the attached corporations;

(£) Develop and prepare the Department’s Legislative Agenda, recommend presidential
certification of the urgency of priority water bills, and other water-related legislations;

a


(g) Coordinate and maintain linkages among the various offices, bureaus, regional offices
and attached agencies to the DWR along with other government agencies on policy
matters affecting the Department's mandate in relation to legislation;

(h) Maintain effective liaison with the Congress and the Senate regarding legislative
inquiries and enactment of water bills or other laws that will affect water into law,

(i) Monitor the progress of the Department's priority/certified bills to ensure their passage;
and

(j) Perform such other related duties and responsibilities as may be assigned or delegated
by the Secretary or as may be required by law.

SEC. 20. Comptrollership and Financial Management Service. ~The Comptrollership
and Financial Management Service is hereby created to provide the Department with
coordinated services relating to financial systems and procedures, budget, cash, accounting and
all financial housekeeping matters. For such purposes, it shall have the following functions:

(a) Advise the Secretary on all matters relating to the accounting of government
expenditures and receipts, budgeting and cash management, project finances and
financial systems and procedures;

(b) Prepare budget proposals and pursue formal budget authorizations, undertake budget
execution, and prepare and submit all appropriate reports to the proper offices:

(c) Develop and maintain accounting, financial and assets management systems,
procedures and practices in the Department Proper, Bureaus and Regional Offices;

(d) Review and appraise systems and procedures, organizational structure, assets
management practices, accounting, and other records, reports, ad performance
standards such as budgets and standard costs of the Department, bureaus, and regional
offices;

(e) Provide assistance in its area of specialization to any unit of the Department and, when
requested, to government corporations and councils attached to the Department; and

(f) Perform such other related duties and responsibilities as may be assigned or delegated
by the Secretary or as may be required by law.

SEC. 21. Resource Regulation Service. - The Resource Regulatory Service is hereby
created to provide the Department with services on resource regulation of all water-related
services and activities. For such purposes, it shall have the following functions:

(a) Advise the Secretary on all matters relating to resource regulations;

22


(b) Determine, grant and regulate water rights for the appropriate, optimal and sustainable
use of surface and ground water;

(c) Determine, evaluate and grant waterworks and sewerage franchises;

(@) Investigate violations of the water rights and the Water Code and impose the
appropriate sanctions in accordance with existing laws, rules and regulations as well as
future rules and regulations which the Department will promulgate;

(e) Adjudicate water use conflicts; and

(f) Perform such other related duties and responsibilities as may be assigned or delegated
by the Secretary or as may be required by the law.

SEC. 22. Internal Audit Office. — The Internal Audit Office is hereby created for the
purpose of conducting comprehensive audit of various Department activities and will report
directly to the Secretary. Specifically, it shall have the following functions:

(a) Advise the Secretary on all matters relating to management control and operations
audit;

(b) Conduct management and operations performance audit of Department activities and
units and determine as to the degree of compliance with established objectives, policies,
standards, methods and procedures, government regulations and contractual obligations
of the Department;

(c) Review and appraise systems and procedures, organizational structure, assets
management practices, accounting and other records, and performance standards (such
as budgets and standard costs) of the Department Proper, Bureaus and Regional Offices;

(@ Analyze and evaluate management deficiencies and assist top management to solve
problems by recommending realistic courses of action; and

(e) Perform such other related duties and responsibilities as may be assigned or delegated
by the Secretary or as may be required by law.

SEC. 23. Public Affairs Office. ~ The Public Affairs Office is hereby created for the
purpose of enhancing government relations with all stakeholders including the media. It shall
ensure that women, men, older people and people with disabilities will be consulted, organized
and can take active part in all aspects of water resources development and management
activities. The office will also lead the planning and organizing of the special events of the
Department. For such purposes, it shall have the following functions:

23


I. Public Awareness

(a) Advise the Secretary on matters pertaining to public affairs services;

(b) Develop and supervise the implementation of communications programs to have
relevant policies, programs and plans of the Department understood by the public;

(c) Produce and supervise the dissemination of communication materials in line with the
priorities of the Department and the national government public information programs;

(d) Conduct public opinion and attitude surveys to identify the interests and concerns of
key groups served by the Department;

(e) Establish editorial policies on print and broadcast media;

(f) Establish and maintain linkages with the tri-media and presence in social media;

(g) Coordinate the conduct of interviews and news conferences;

(h) Act as spokesperson for the Department;

(i) Coordinate with various Department units, concerned government agencies, tri-media
and other stakeholders on matters related to the above-enumerated functions; and

(j) Coordinate with the appropriate national government agencies tasked with public

information affairs.

I. Promoting Parti

(a) Conduct public consultations and discussions;

(b) Develop and disseminate relevant and appropriate materials and programs for public
information and education, as well as advocacy campaign;

(c) Conduct seminars and workshops involving the LGUs and the general public on current
water issues and problems; and

(d) Conduct capability building seminars of various stakeholders to promote meaningful
participation in the Department’s policy making, planning, development and

implementation of various programs and projects.

IIL. Special Events
(a) Coordinate the organization and promotion of special events and water exhibits,
(b) Actas the focal point for all water related events; and
(c) Perform such other related duties and responsibilities as may be assigned or delegated

by the Secretary or as may be required by law.

24


SEC. 24, Water Pollution Adjudication Board, ~ There is hereby created a Water
Pollution Adjudication Board under the Office of the Secretary. The Board shall be composed
of the Secretary as Chairman, two (2) Undersecretaries as may be designated by the Secretary,
the Director of Water Quality Management Bureau and three (3) other representatives from
other stakeholders to be designated by the Secretary as members. The Board shall assume the
powers and functions of the Commission/Commissioners of the National Pollution Control
Commission with respect to the adjudication of water pollution cases under Republic Act No.
3931, Presidential Decree 984, particularly with respect to Section 6 letters e, f, g, j,k and p of
the P.D. 984 and RA 9275. The Bureau of Water Quality Management shall serve as the
Secretariat of the Board. These powers and functions may be delegated to the field officers of

the Department in accordance with rules and regulations to be promulgated by the Board

SEC. 25. Bureaus. — Each Bureau shall be headed by a Bureau Director who shall be
responsible for efficiently and effectively carrying out the functions of the Bureau concemed.
The Bureau Director shall be assisted by one (1) Assistant Director.

SEC. 26. Bureau of Flood Control and Drainage. - The Bureau of Flood Control and
Drainage is hereby created to plan and design flood control and drainage structures and
facilities in accordance with technical standards, guidelines and manuals. For this purpose, it
shall have the following duties and responsibilities:

(a) Formulate policy, strategies and programs on flood risk management in the context of
integrated flood management (IFM) which integrates water, land, coastal zone and
multi-hazard management. In integrating land-use planning and water management, the
Department should harmonize and synthesize plans to enable the sharing of information
between land-use planning and water management authorities. In integrating hazard
management, a holistic approach should be adopted so that IFM should be part of a
wider risk or multi-hazard management system (e.g., earthquake, landslides, fire,
tsunami, etc. );

(b) Integrate climate change and disaster risk reduction and management in policies and
plans;

(c) Prepare master plans of flood management and drainage in river basins in coordination
with the concerned water resources region and river basin organizations;

(d) Prepare master plans of urban drainage in cities/municipalities;

() Prepare feasibility studies of recommended measures in the master plans;

2


(f) Plan and design structural measures for flood control and drainage;

(g) Implement and/or collaborate with concemed agencies on the non-structural measures;

(h) Patrol and investigate rivers including the monitoring of stream flows;

(i) Conduct post-disaster investigation and evaluation and damage assessment of flood
infrastructures after extreme events;

(j) Conduct research and development on water and sediment-related disasters,

(k) Develop design guidelines, criteria and standards on flood control and drainage
structures;

(1) Provide technical assistance to other agencies, LGUs and other stakeholders;

(m) Advise the Secretary on declaring flood control areas and recommend guidelines for
flood plain management plans in these areas; and

(n) Perform such other related duties and responsibilities as may be assigned or delegated
by the Secretary or as may be required by law.

SEC. 27. Bureau of Water Quality Management. — The Bureau of Water Quality
Management is hereby created to supervise and control over all aspects of water quality
management to ensure the sustainability of the country’s water resources and the protection of
the environment. It should take into account proper and integrated treatment of freshwater and
wastewater within the whole process. For this purpose, it shall have the following duties and
responsibilities:

(a) Establish water quality guidelines for freshwater and coastal/marine waters as basis for
classifying water bodies in the country. Specifically, develop water quality indices or
composite metrics to measure of the quality status and health of natural water bodies in
relation to ecological integrity and function;

(b) Establish effluent standards for point sources of pollution;

(c) Establish internationally accepted procedures for sampling and analysis;

(d) Prepare an integrated water quality management framework;

(©) Prepare 10-year water quality management plans for each water quality management
area as part of the River Basin Master Plans and in support of the National Water
Resources Management Framework Plan;

(£) Classify groundwater sources and prepare a national groundwater vulnerability map;

(g) Classify or reclassify all water bodies according to their beneficial usages using the
established water quality guidelines established;

26


(h) Issue permits, clearances and similar instruments pursuant to the Clean Water Act of
2004;

(i) Collect the wastewater discharge (EUF) fees for all permittees;

(j) Monitor the compliance of water discharge permittees with the effluent standards;

(k) Regularly monitor the water quality of major water bodies in the country and analyze
the data to identify possible sources of pollution;

(I) Issue notices of violations and/or cease and desist orders for those found in violation;

(m) File the needed cases against violators with the Water Pollution Adjudication Board;

(n) Serve as secretariat of the PAB; and

(0) Perform such other related duties and responsibilities as may be assigned or delegated
by the Secretary or as may be required by law.

SEC. 28. Water Resources Regional Offices. - The Water Resources Regional Offices,
organized per water resources region shall be responsible for implementing the mandates,
powers and duties of the Department at the field level, except for policymaking which will be
vested solely with the Central Office. The master planning for the nearby river basins (e.g.
Pasig-Marikina-Laguna Lake-Cavite) will likewise be the responsibility of the Central Office.
For this purpose, the duties and responsibilities of the WRRO shall be as follows:

(a) Formulate or update and coordinate the river basin master plans for river basins within
its jurisdictions ensuring consistency with the National Water Resources Management
Framework Plan;

(b) Advocate and strongly support the creation and functioning of multi-stakeholder River
Basin Organizations (RBOs) and serve as the secretariat of the said RBOs;

(c) Undertake and evaluate the planning, design, and work supervision functions of the
Department for the water infrastructures within the region;

(d) Ensure the implementation of laws, policies, programs, rules and regulations regarding
the abovementioned infrastructure as well as public and private physical structures;

(e) Provide technical assistance related to the water-related functions of other agencies
within the region especially the local government;

(f) Coordinate with other departments, agencies, institutions and organizations, especially
local government units within the region in the planning and implementation of the

river basin master plans,

a


(g) Conduct continuing consultations with the local communities, take appropriate
measures to make the services of the Department responsive to the Central Office and
recommend such appropriate actions as may be necessary; and

(h) Perform such other related duties and responsibilities as may be assigned or delegated
by the Secretary or as may be required by law.

The Department shall retain and have such Project Management Offices as may be
required, which shall be under the supervision and control of the appropriate Water Resources
Regional Office Director, unless otherwise determined by the Secretary for reasons of supra-
regional scope, magnitude and multi-functional coverage.

SEC. 29. Water Resources Regional Director. —The Water Resources Regional Offices
shall be headed by a Water Resources Regional Director who shall be responsible for
efficiently and effectively carrying out the duties and responsibilities of the Office. Towards
this end, the Water Resources Regional Director shall, within his/her defined powers exercise
functional and administrative supervision over all units within the region including the
authority to commit their resources and personnel to integrated regional water resources
management, water supply and sanitation management, and flood control and flood risk
management initiatives. The Water Resources Regional Director shall also perform such other
related duties and responsibilities as may be assigned or delegated by the Secretary or as may
be required by law.

‘The Water Resources Regional Director shall be assisted by two (2) Assistant Water
Resources Regional Office Directors who shall exercise supervision respectively over (1) the
planning, project design and evaluation function and (2) technical assistance to River Basin

Organizations within the water resources region.

CHAPTER II
INTERDEPARTMENTAL RELATIONS OF THE DWRM
SEC. 30. Interface with Other Agencies. —

(a) The Department of Health (DOH) shall continue to have primary authority and
responsibility for setting and enforcing drinking water quality standards. The
Department shall coordinate with the DOH in this regard and shall ensure consistency
of standards and targets which it will set for compliance of permittees with the DOH’s
mandated standards;

28


(b) The Department of Environment and Natural Resources (DENR) shall continue to have
primary authority and responsibility for protecting the environment and managing the
country’s watersheds;

(©) The Department of Energy (DOE) and the National Power Corporation (NPC) shall
continue to have primary authority and responsibility for setting up and running
hydropower plants but will ensure that any hydropower plant development plans are
consistent with the National Water Development and Management Plan;

(d) The Department shall coordinate with the Department of Agriculture (DA) and the
National Irrigation Administration (NIA) to ensure agricultural development that
reduces sources of long-term pollution for surface water and groundwater, and
agricultural and industrial economic development that employs water efficiency, water
recycling/reuse and the appropriate treatment of wastewater,

(e) The Department shall coordinate with the National Disaster Risk Reduction
Management Council (NDRRMC) to ensure that its plans and designs for flood control,
flood risk management and drought risk management are aligned with the objectives
and plans of the said Department;

(f) The Department shall coordinate with Climate Change Commission (CCC), PAGASA,
and NAMRIA for scientific studies, integrated surveys, mapping, charting and decision
support systems

(g) The Department shall coordinate with the Department of Tourism (DOT) on
recreational use of water resources;

(h) The Department shall coordinate with the Philippine Reclamation Authority and
economic zone authorities on water resources development and water requirements
within reclamation areas and economic zones, respectively; and

(i) The Department shall coordinate with relevant government agencies, including Local
Government Units (LGUs) for development projects and to ensure cross-cutting
collaboration between and among all water subsectors and facilitate inter-agency
subsector coordination, strategic development, planning, monitoring and provision of
technical, institutional and financial capacity building support to their different
stakeholders at the water subsector level.

SEC. 31. National Water Sector Policy Board. ~ The National Water Sector Policy
Board shall hereby be created to be headed by the Secretary of the Department of Water
Resources Management consisting of representatives from the which the National Economic

29


and Development Authority shall serve as the Vice-Chairman, Department of Health (DOH),
Department of the Interior and Local Government (DILG), Department of Energy (DOE),
Department of Agriculture (DA), Department of Social Welfare and Development (DSWD)
Department of Public Works and Highways; Department of Budget and Management (DBM);
Office of the President (OP), and Department of Environment and Natural Resources (DENR),
as members. The Staff of the DWRM shall serve as Secretariat to the Board,

SEC. 32. Powers and Functions of the National Water Sector Policy Board (NWSPB).
— The NWSPB, being empowered with policymaking, coordination, integration, supervision,
monitoring and evaluation functions, shall have the following responsibilities:

(a) Approve the National Water Resources Management Framework Plan which-shall
serve as a principal guide to water management efforts in the country and shall be
reviewed on a five (5)-year interval, or as may be deemed necessary, in order to ensure
its relevance to the times;

(b) Provide overall policy direction and recommend policies on water resources that will
require Presidential decision

(c) Advise the President on the status of water management and supply, recommend to the
President the declaration of a state calamity in areas affected by water supply, and
submit proposals to restore normalcy in the affected areas;

(4) Consistent with IWRM, ensure a multi-stakeholder participation in the development,
updating, and sharing of information system as policy, planning and decision-making

tools;

SEC. 33. Transfer of Rights and Obligations. - The Department shall, by virtue of this
Act, be surrogated to all the rights and assume all the obligations of the government agencies
and units whose powers and functions have been absorbed, transferred or attached to the
Department provided these are in accordance with the rules and regulations of the Commission
on Audit. The transfer of powers and functions as herein provided shall take effect within 6
months of the effectivity of this Act. As such, all affected agencies/offices/units shall continue
to function under their present mandates until the transition is fully in effect.

SEC. 34, Funding. - The sum of Two Billion pesos (P2,000,000,000.00) shall be set
aside from available funds of the National Treasury and is hereby appropriated and authorized

to be released for the organization of the Department and its initial operations. Thereafter, the

30


Department shall submit its annual budget to fully carry out its powers and functions and
achieve its objectives to the Office of the President, for approval, provided it shall not be less
than the amount provided for in its initial implementation.

SEC. 35. Water Trust Fund. — There is hereby created a Water Trust Fund in the Bureau
of Treasury. All non-tax revenues, including permit fees, registration fees, supervision and
regulation enforcement fees, filing fees, testing fees, and other service income from the use of
water resources shall be remitted to the Water Trust Fund. Said trust fund shall be accounted
separately from government’s general revenues and shall be automatically appropriated to the
Department of Water Management. Proceeds from the trust fund shall be exclusively utilized
for water development and water sustainability programs and projects authorized under this
Act.

SEC. 36. Implementing Rules and Regulations. ~ Within one hundred eighty (180) days
from the effectivity of this Act, the Department, in consultation with the concerned government
agencies, shall promulgate the necessary implementing rules and regulations for the
implementation of this Act; Provided, That such revised implementing rules and regulations
shall only take effect fifteen (15) days following its publication in two (2) newspapers pf

general circulation.

CHAPTER IV
WATER REGULATORY COMMISSION

SEC. 37. The Water Regulatory Commission. — There is hereby created and established
an independent, quasi-judicial regulatory body to be named the Water Regulatory Commission,
hereinafter referred to as the “Commission”, which shall be organized within one hundred
twenty (120) days after the effectivity of this Act.

The Commission shall be placed under the administrative supervision of the
Department of Environment and Natural Resources (DENR)

The Commission shall have a Board of Commissioners, and shall be vested with
powers and functions, as conferred and set forth hereunder.

SEC. 38. The Regulatory Units. ~ The Regulatory Units of the Commission shall be
composed of the Provincial Regulatory Units and the Central Regulatory Unit.

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The Provincial Regulatory Units shall be established by the Commission in accordance
with such rules, regulations, guidelines and standards as the Commission shall issue, and as,
provided hereunder.

Moreover, the pertinent regulatory divisions or units of MWSS, NWRB, LWUA,
LLDA, SBMA, PEZA, and TIEZA are hereby transferred to the Commission, and they shall
collectively comprise its Central Regulatory Unit for Water Supply and Sanitation Services
that: (a) provide services to more than one province; and (b) are owned, operated and/or
maintained by special economic zones and Metro Manila concessionaires.

SEC. 39. Powers and Functions of the Commission. — The overall authority and
powers of the Commission shall cover and apply to all Service Providers, whether private or
public, providing or intending to provide levels II & III water supply, including suppliers to
subdivisions and/or other Service Providers; sewerage; and/or septage treatment and disposal
services for domestic/residential, industrial or commercial use.

The Commission shall have the following powers and functions:

a) Issue and promulgate rules, regulations and guidelines as may be necessary to
implement and enforce its powers and functions under this Act;

b) Set and enforce just and reasonable technical standards, classifications and
measurements of service;

c) Appoint the central and provincial regulators;

d) Establish rules and regulations to monitor, avoid and provide remedies for any market
power abuse or anti-competitive or discriminatory act or behavior by or against any
participant in the water supply and sanitation sector. Upon finding that a market
participant has engaged in, or fell victim to such act or behavior, the Commission shall
act to stop and/or redress the same. Such remedies may, without limitation, include the
imposition of price controls, issuance of injunctions, requirement of divestment or
disgorgement of excess profits, invalidation of contracts and imposition of fines and
penalties pursuant to this Act.

e) Adopt and require that books, records and accounts be kept and maintained in
accordance with the prescribed uniform accounting system;

f) Fix and determine proper and adequate rates of depreciation of properties and
equipment used in Water Supply and Sanitation Service/s;

g) Impose and collect annual levies determined as a percentage of gross revenue accruing
in relation to the licensed activities, and reasonable fees and surcharges as may be

32


necessary for achieving the purposes, powers and functions of the Commission;

h) Require the submission reports of finances and operations, verified under oaths by the
‘owner or president and secretary of the Licensee;

i) Determine and require the monitoring and submission of such data, statistics and other
information from the Regulatory Units and any or all licensees as may be necessary for
the effective and efficient exercise of its duties, functions, powers and responsibilities.

j) Investigate, motu propio or upon complaint in writing, any matter concerning the
operation of the service and require that service be provided in proper and suitable
manner,

k) Impose penalties and fines against any Licensee or against its owners, directors,
officers, agents or representatives for any violation of this Act or of the license, order,
rule regulation or requirement issued by the Commission;

1) Require any Licensee to pay the actual expenses incurred by the Commission in any
investigation if it shall be found that a Licensee violated any provision of this Act or of
the license, order, rule regulation or requirement issued by the Commission;

m) Advise, apprise and coordinate with other relevant agencies of the national or local
government on any matter relating to Water Supply and/or Sanitation Services;

n) Deputize agents, whether from the public or private sector, to assist in the
performance of any of the powers and functions of the Commission;

0) Upon appeal and after due hearing, appoint an interim or temporary management
committee to ensure continuity of service in cases a Licensee fails to meet conditions
of the license and the concerned Regulatory Unit fails or refuses to appoint an interim
management committee as provided in the following section.

p) Appoint, hire and maintain adequate staff and personnel, advisers, and/or consultants,
with suitable qualifications and experience, as necessary;

q) Original and exclusive jurisdiction over all cases contesting rates, fees, fines and
penalties imposed by the Regulatory Units in the exercise of their powers, functions
and responsibilities, as set forth herein, and over all cases involving disputes between
and among participants or stakeholders in the Water Supply and/or Sanitation Services;
and

r) Such other incidental powers and functions as may be necessary to attain the
objectives of this Act.

33


SEC. 40. Powers and Functions of the Regulatory Units, ~ The Regulatory Units of
the Commission shall have the following powers and functions:

a) Issue Licenses authorizing the operation of Water Supply and/or Sanitation Services in
any specified area or areas within the Philippines.

b) Impose fines, charges and other penalties upon any Provider and/or its officers and
stockholders who shall fail or refuse to register and/or obtain a License prior to
‘operation or commencement of business, as provided hereunder.

c) Consistent with rules, guidelines, procedures and methodologies which the
Commission shall provide, review, determine, fix, and approve proposed water and
sewerage tariffs, rates and charges that Licensees may impose upon their
customers/consumers;

d) Appraise and value property and equipment used by Licensees in providing water
supply and sanitation service/s.

e) Enforce technical, financial and other performance standards set by the Commission
for licensees/utilities;

f) Respond to consumer complaints and ensure the adequate promotion of consumer
interests,

g) Investigate accidents directly or indirectly arising from or connected with the
maintenance or operation of the service, and make such order or recommendation as
the public interest may warrant;

h) Upon petition or motu propio where in its determination public interest so dictates,
require the review and/or approval of contracts or agreements that may impact on the
tariff and rates of service provision entered into by Service Providers;

i) Require the submission of reports, plans and other documents that set out the
performance targets of the licensees/utilities, and regular accomplishment reports;

) Impose and collect annual levies determined as a percentage of gross revenue accruing
in relation to the licensed activities, and reasonable fees and surcharges as may be
necessary for achieving the purposes, powers and functions of the regulator,

k) Conduct benchmarking and monitor the performance of licensees/utilities under their
jurisdiction, and publish reports detailing the results thereof, as may be necessary or
required by the Commission;

1) Amend, modify, suspend or revoke any License issued by them, after due notice and
hearing, on any of the following grounds:

i. when the facts and circumstances on the strength of which the license was issued

4


have been materially misrepresented or has materially changed;
ii, where the Licensee has failed to meet or comply with terms, conditions and
performance targets - including but not limited to service expansion - that may
have been set in the license;
iii, where the Licensee is found to be manifestly inefficient in the operation of or
provision of Water Supply and Sanitation services in its area; or
iv. when the holder thereof has violated or willfully refused to comply with any order,
rule or regulation of the Commission or any provision of this Act;
m) Appoint an interim management committee to ensure continuity of service in case a
licensee fails to meet conditions of the license; and

n) Submit performance plans and reports as required by the Commission.

SEC. 41. Composition. —

a) The Commission shall be a collegial body composed of five (5) full-time members
composed of a Chairperson and four (4) members, who shall all be appointed by the
President of the Philippines. All members of the Commission must be citizens and
residents of the Philippines, at least thirty five (35) years of age, and of good moral
character, recognized integrity and competence in the field of law, business,
commerce, finance, accounting or public administration, water or utility economics,
management, physical or engineering services, hydrology and other related services,
with at least three (3) years actual and distinguished experience in their respective
fields of expertise; Provided that out of the four members of the Commission, at least
‘one (1) shall be a member of the Philippine Bar with at least ten years of experience
in the active practice of law, and at least one (1) shall be a certified public accountant
with at least ten years of experience in active practice.

b) The term of office of each member of the Commission shall be seven (7) years;
Provided, however, that among the members first appointed, the Chairperson shall
serve for a period of seven (7) years, two (2) members shall serve for five (5) years
and the other two (2) members shall serve for three (3) years; Provided, further, that
any member whose term has expired as specified herein shall serve as such until his
successor shall have been appointed and qualified; Provided, moreover, that any
appointment to fill a vacancy in the Commission arising from death, removal,
retirement or resignation shall be made only for the unexpired term; and Provided,

35


finally, that in no case shall any member serve for more than seven (7) years in the
Commission.

c) The Commission shall meet as often as may be necessary on such day or days as the
Chairperson may fix. The presence of at least three (3) members of the Commission
shall constitute a quorum, which shall be necessary for the transaction of any
business. The affirmative vote of majority of the members of the Commission where
a quorum is present shall be necessary for the adoption of any order, resolution,
decisions, or other act of the Commission in the exercise of its quasi-judicial
functions, Provided that in promulgating rules, regulations, guidelines and in the
exercise of its quasi-legislative functions, an affirmative vote of three (3) members
shall be required.

d) The Chairman of the Commission shall exercise general executive control and
supervision of the Commission and its members, staff and personnel, agents and
representatives.

Within three (3) months from the creation of the Commission and the appointment of
all Members of the Commission, the Chairman shall submit for the approval by the
President of the Philippines the new organizational structure and plantilla positions
necessary to carry out the powers and functions of the Commission, including those of
the Central and Provincial Regulatory Units.

The staff and personnel positions of the Commission shall be filled by regular
appointments in accordance with a staffing plan to be prepared by the Commission.

¢) Members of the Commission shall enjoy security of tenure and shall not be suspended
or removed from office except for just cause as specified by law.

f) The Chairman and members of the Commission or any of their relatives within the
fourth civil degree of consanguinity or affinity, legitimate or common law, shall be
prohibited from holding any interest whatsoever, either as investor, stockholder,
officer or director, in any company or entity engaged in provision of water supply and
distribution, septage management and sewerage services and must, therefore, divest
through sale or legal disposition of any and all interests in the water sector upon
assumption of office.

SEC. 42. Commission Secretariat. ~ The Commission shall establish a Secretariat
which shall provide the Commission with technical and other support including, among others:

36


a) Providing the necessary technical inputs and secretariat support to the Commission to
facilitate the conduct of its functions;

b) Coordinating with Regulatory Units to ensure proper implementation of the rules,
regulations and guidelines promulgated by the Commission;

c) Monitoring and assessing activities of the Regulatory Units vis-a-vis their respective
annual performance plans and targets;

d) Maintaining a database on the water supply and sanitation subsector; and

) Coordinating with other relevant agencies of the national or local government on any
matter relating to water supply and sanitation.

SEC. 43. Executive Director. ~ The Commission shall also appoint an Executive
Director who shall head the Commission Secretariat, keep and maintain the official record
and report of the proceedings of the Commission, and have the authority to administer oaths
in all matters falling within the jurisdiction of the Commission.

The Executive Director shall be responsible for the effective implementation of the
policies, plans, programs, rules, regulations and directives of the Commission; coordinate and
supervise the activities of the different operating units under the Commission; and perform
such functions as may be assigned by the Chairperson and/or other members of the

Commission.

SEC. 44. Compensation and Other Emoluments. — The compensation of the members
of the Commission and its staff shall be exempt from the coverage of Republic Act. No. 6758,
otherwise known as the “Salary Standardization Act.” Provided, that the salaries of the
Commission and its staff shall conform as closely as possible to the principles of R.A. 6758.

For this purpose, the schedule of compensation of the Commission and its Regulatory
Units and staff shall be submitted for approval of the President of the Philippines. The
compensation schedule of the Commission and its Regulatory Units and staff shall be
implemented within six (6) months from the effectivity of this Act and maybe upgraded by
the President of the Philippines as the need arises: Provided further, that in no case shall the
compensation of the Commission and its staff be upgraded more than once a year.

Pertinent civil service laws, rules and regulations of the Philippines shall be applicable
to the Commission.


The Chairman and members of the Commission shall initially be entitled to the same
salaries, allowances and benefits as those of the Presiding Justice and Associate Justices of the
Supreme Court, respectively.

CHAPTER V
REGISTRATION AND LICENSING

SEC. 45. Registration and Licensing of All Water Supply and/or Sanitation Services.
— All Water Supply and/or Sanitation Service Providers, including Bulk Water Suppliers and
those providing services to subdivisions and/or other Service Providers, shall register with
the Commission and, subject to such rules, guidelines, procedures and other issuances as the
Commission may issue, obtain a License to operate from the appropriate Regulatory Units.

The Commission shall also ensure that the granting and revocation of licenses are
carried out fairly, transparently, and without discrimination. Its issuances shall therefore
specify, among others, the qualifications, requirements and procedure for the granting and
revocation of Licenses, as well as the standards and performance targets that must
continuously be complied with in order to keep such licenses valid.

Unless otherwise provided herein or by the Commission, no public Water Supply
and/or Sanitation Service provider shall commence or conduct the business of providing water
supply and sanitation services without first obtaining a license.

Concession agreements and other contracts for water supply provision currently
existing shall remain valid and in force, unless otherwise invalidated by the Commission

where public interest so dictates, after due notice and hearing

SEC 46. Conditions of License. ~ The Commission and/or the concerned Regulatory
Unit, may impose such conditions in the issued License, as it may deem necessary, such as but
not limited to:

a) Tariffs, rates and charges that may be imposed from its customers/consumers.

b) Term fixing the duration of the privilege.

c) Grounds for modification, suspension or cancellation of the License.

4d) Minimum technical performance and service level standards.

¢) Expansion targets and service level improvements over time.

f) Restrictions or conditions for transferability of the business or controlling interest in

the business.

g) Reportorial requirements and obligations of the grantee

38


h) Submission to annual performance audit by the Commission or its duly authorized
representative(s).

The Commission shall specify the requirements and procedure for existing holders of
Certificate of Public Convenience/Certificates of Public Convenience and Necessity issued
by NWRB, and/or Conformance issued by LWUA, to convert their existing certificates into
Licenses issued by the Commission.

All existing providers of Water Supply and/or Sanitation Services without a legal and
valid Certificate of Public Convenience/Certificate of Public Convenience and Necessity or
Certificate of Conformance shall register with the Commission and apply for a License within
six (6) months from the effectivity of this Act.

SEC. 47. Rights and Duties of Licensees. —

a) Any person granted a License under this Act shall have the obligation to ensure that its
licensed activities are conducted so as to further the public interest and, in particular,
that they:

i. foster the maintenance and development of efficient, coordinated, and viable
operation of their licensed activities;

ii, ensure that their Water Supply and/or Sanitation Services are provided in a
diligent, conscientious and workmanlike manner, in accordance with applicable
laws and the standards and practices set by the Commission and generally
accepted in the water supply and sanitation industry;

iii. comply with drinking water quality requirements and other requirements and
standards that may be set by the Commission; and

iv. not abandon its service without notice to and approval by the Commission.

b) Any person granted a License under this Act shall, to the extent allowed by law and
specified in the License, have the right to acquire or lease land and lay or repair water
or sanitation mains and other relevant facilities in public ways, when required to fulfill
their obligations.

c) Subject to any condition or limitation laid down in the License, a Licensee may
disconnect the supply of Water Supply and/or Sanitation services to a customer if
such customer defaults in the payment of amount(s) due to that Licensee in respect of
water supplied or sanitation services provided, or for acts of pilferage pursuant to
Sections 8, 9, 10, and 11 of Republic Act No. 8041, otherwise known as the "Water
Crisis Act of 1995."

39


d) Any License issued under this Act shall contain provisions designed to ensure that

Licensees:

Publish the Tariff and other charges approved by the Commission, and other terms
and conditions imposed by the Commission for the provision of Water Supply
and/or Sanitation Services.

Prepare, within three (3) months from the issuance of a License, in consultation
with its customers, a customer service code specifying the manner and procedure
for: (a) metering, billing, and collection of the Licensee’s approved tariff and other
charges, (b) disconnection or suspension of service in case of non-payment of
tariffs and/or other charges, or acts of pilferage, and (c) recommendation and
recovery of arrears in tariffs and other charges; and

Maintain financial accounts in accordance with the manner and procedure

specified in the License and as may be required by the Commission.

Maintain and upon request by anyone during regular office hours, promptly make

available for scrutiny and inspection such data, statistics and other information,
as may be required by the Commission.

SEC. 48, Setting Tariffs, Rates and Other Charges. - Regulatory Units shall establish

tariffs, rates and other charges which are fair and reasonable, and which provide for the
economic viability of the service and a fair return on their investments considering the

prevailing cost of capital in the domestic and international markets.

Such tariffs, rates and charges shall be based on and consistent with a rate-setting

methodology that the Commission shall, after due consultation, define and publish, taking into

account the following, among others:

a) reasonable and prudent capital and recurrent costs of providing the service including a

reasonable rate of return on capital;

b) efficiency of the service;

©) incentives for enhancement of efficiency;

d) willingness to pay of the customers/consumers;

e) equity considerations; and

f) administrative simplicity.

Tariff, rates and charges set by the Regulatory Units shall be presumed valid and

reasonable unless a protest or contest is filed with the Commission.

40


SEC. 49. Promotion of Innovative Schemes to Improve Efficiency and Management
of Systems. ~ The Commission shall promote innovative schemes, including but not limited to
the consolidation and/or integration of Water Supply and/or Sanitation Services and/or
Providers in the same Service Area, where it will result in improved efficiency, services
expansion and/or lowering of costs.

To this end, the Commission shall establish and issue such rules and guidelines as
may be necessary to (a) create incentives to encourage efficiency and service expansion; (b)
establish the standards and targets that service providers are required to meet; and (c) set the

fines and penalties that would be imposed for failure to meet such standards and targets.

CHAPTER VI
QUASI-JUDICIAL FUNCTIONS OF THE COMMISSION
SEC. 50. Proceedings Before the Commission, — For the purpose of any investigation,
inquiry or proceeding, the Commission shall have the requisite power to:

a) Issue subpoena duces tecum and subpoena ad testificandum;
b) Appoint hearing officers to hear and receive evidence on behalf of the Commission;
c) Cite any person or party for contempt for refusal to appear, testify or comply with an

order of the Commission on any matter that is the subject of investigation, inquiry or

proceeding before the Commission.

SEC. 51. Orders and Decisions of the Commission. ~ The orders, resolutions and
decisions of the Commission, which must be reached as promptly and expeditiously as
reasonably and fairly possible, shall be in writing and shall state clearly and distinctly the
facts and law on which it is based.

The Commission shall publish and make available for public inspection all decisions

and final orders in the adjudication of contested cases or applications.

SEC. 52. Appeals Procedure and Prohibition Against Injunction, ~
a) The orders, rulings, and decisions of the Commission are final and executory unless
appealed to the Court of Appeals within fifteen (15) days from receipt of notice of such
order, ruling or decision; Provided that orders, rulings, and decisions of the
Commission approving tariffs shall be immediately executory and may be suspended
only upon appeal and filing of a bond, in an amount to be fixed by the Commission,

at


to answer for damages occasioned by the suspension or stay of execution of such
orders, rulings, and decisions.

b) No injunction may be issued by any court or administrative agency to restrain any
proceeding before, or the implementation or execution of any order, ruling, or
decision of the Commission, except on the basis of a question of law brought before
the Supreme Court on certiorari

c) Subject to Sec. 7, paragraph 3 of this Act, an act or decision of the Commission shall
not be invalid merely because of a defect or irregularity in, or in connection with, the
appointment or vacancy in the Office of the Chairperson or any other member of the

Commission.

CHAPTER VII
INTERDEPARTMENTAL RELATIONS OF THE WRC
SEC. 53. Interface with Other Sector Regulators. —

a) The DENR shall continue to have the primary authority and responsibility for
protecting the environment and the quality water sources from waste and pollution and
shall promulgate rules, regulations, and standards in this regard.

b) The Department of Health (DOH) shall have primary authority and responsibility for
determining and enforcing drinking water quality and sanitation standards. The
Commission shall coordinate with the DOH in this regard and shall ensure the
consistency of the standards and targets that it will set for compliance by licensees with
the DOH’s mandated standards.

c) The Commission shall coordinate with the NWRB for water allocation and data
collection, the local government units for development projects relating to water supply
and sanitation, and the Department of Public Works and Highways for flood control

and the hamessing and impounding of water.

SEC. 54. Transfer of Rights and Obligations. - The Commission shall, by virtue of
this Act, be subrogated to all the rights, and assume all the obligations, of the Water Utilities
Division of the NWRB, the Regulatory Offices of MWSS and LWUA, the Regulatory Units
of all special economic zones, and all other government agencies and units whose powers and
functions have been transferred to the Commission.

The transfer of powers and functions in the Department and agencies attached thereto,
as herein provided for, shall take effect within six (6) months after the effectivity of this Act.

a2


The foregoing transfer of powers and functions shall include all applicable funds, personnel,
records, property and equipment, as may be necessary. The same shall apply to agencies which
have been attached to the Department by virtue of this Act.

As such, all offices under the Department and all attached agencies affected by the
provisions of this Act shall continue to function under their present mandates until transition is
effected as provided for under this Act.

The heads of the agencies shall continue to serve until replaced as provided for under
this Act.

All rights and obligations of the said government agencies are hereby transferred to and
assumed by the Commission and shall be acted upon in accordance with the rules and
regulations of the Commission on Audit and other pertinent laws, rules, and regulations.

SEC. 55. Separation form Service. - Employees separated from government service as
a result of this Act shall be entitled to the benefits which they may receive under existing laws,
rules and regulations.

SEC. 56. Funding. — The sum of Three Hundred Million (P 300,000,000.00) pesos shall
be set aside from any available funds of the National Treasury, and is hereby appropriated and
authorized to be released, for the organization of the Commission and its initial operations.

Thereafter, funds sufficient to fully carry out the objectives, powers, and functions of
the Commission and its Regulatory Units shall be appropriated every fiscal year in the General
Appropriations Act, in an amount that shall not be less than the amount appropriated for it the
previous year.

The Commission shall submit its annual budget, which shall include, among others,
detailed information on the compensation and benefits received by their employees, to the
DENR for approval.

Moreover, subject to existing rules and regulations of the Department of Budget and
Management (DBM), all funds and monies collected by the Commission from fees, charges,
surcharges and penalties, which the Commission may impose and collect under this Act, shall
accrue directly and automatically to the Commission and shall be utilized solely for its
operations. The guidelines for the collection and disbursement of these proceeds shall be
defined in the implementing rules and regulations of this Act.

A proportion of the abovementioned amounts shall be used for training and capacity
building purposes, including the upgrade and procurement of equipment and software as may

43


be necessary for the efficient and effective exercise of its powers. Such upgrades and
procurements shall comply with the requirements of existing laws on procurement, accounting
and auditing rules and regulations.

The amount of funds and monies collected, and the costs and purposes for which such
were expended shall be made publicly available upon request, as well as on an official website
that the Commission shall establish.

Sec. 57. Transitory Provisions, ~ Performance audit of all water-related agencies and
institutions, including but not limited to LWUA and water districts, MWSS, MWSS-RO and
its concessionaires, LGU-run utilities, TIEZA, PEZA, BCDA, SBMA, DILG, and NIA, shall
be conducted by the Department.

SEC. 58. Repealing Clause. — All laws, decrees, executive orders and proclamations,
rules and regulations or parts thereof inconsistent with this Act, are hereby repealed, or
amended or modified accordingly.

The provision with respect to fixing of water rates and sanitation service fees of Section
3 (h) and Section 12, and regulation of waterworks and deep wells of Section 3 (n), regulation
of waterworks and sanitation systems in privately owned subdivisions of Section 3 (p) of
Republic Act 6234, as amended, is hereby repealed or modified accordingly.

Section 62 on regulation and Section 63 on rate review of Presidential Decree 198, as
amended by LOI 700 (1978), LOI 744 (1978), EO 124 (1987), EO 123 (2002), is hereby
repealed or modified accordingly.

The provisions of the Local Government Code and its Implementing Rules and
Regulations of Republic Act No. 7160 which allow local government units to fix the rates of
water utilities owned, operated and maintained by them within their jurisdiction is hereby
repealed or modified accordingly

Section 13 (b) on regulation of enterprises in ECOZONE of Republic Act No. 7916
as amended, also known as the Special Economic Zone Act of 1995, is hereby repealed or
modified accordingly.

“Provisions under Section 69 of Republic Act No. 9593 or the Tourism Act of 2009
and its Implementing Rules and Regulations which mandates the Tourism Infrastructure and
Enterprise Zone Authority to grant franchises, supervise the operation of public utilities, and
register, monitor and regulate enterprises within Tourism Enterprise Zones, are hereby repealed
or modified accordingly.”


Commonwealth Act No. 146, as amended, otherwise known as the “Public Service
Act,” and all laws, decrees, rules and regulations, or portion thereof, inconsistent with this
‘Act are hereby repealed or modified accordingly.

SEC. 59. Separability Clause. - If any provision of this Act is held invalid or
unconstitutional, the remaining parts or provisions not affected shall remain in full force and

effect.

SEC. 60. Effectivity. — This Act shall take effect fifteen (15) days after its publication

in the Official Gazette or in a newspaper of general circulation.

Approved,

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