THIRTEENTH CONGRESS OF THE REPUBLI 
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First Regular Session 
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OF THE PHILIPPINES 
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Introduced by Senator S. R. Osmefia 111 
EXPLANATORY NOTE 
The barangay is the smallest political unit of the government. With its 
direct links to constituents, the barangay stands on the frontlines in the delivery 
of basic services to the public. 
This bill seeks to empower the barangay towards developing a key role in 
economic development by giving it the right of first refusal in contracts with 
national government agencies and local government units LGUs for the delivery 
of public services to its constituents. 
This measure will have at least two beneficial effects: one is that it will 
strengthen the coordination links among the different levels of government, and 
its constituents, and two, 
it will generate employment for people at the 
grassroots level. 
In view of the foregoing, early passage of this bill is earnestly requested. 
SERGIO OSMENA 111 
Senator 


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THIRTEENTH CONGRESS OF THE REPUBLIC 
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OF THE PHILIPPINE§ 
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First Regular Session 
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B 
S E N A T E  
S. No. 
introduced by Senator S. R. Osmeiia 111 
AN ACT 
AUTHORIZING BARANGAYS TO ENTER INTO OFFICIAL CONTRACTS WITH 
NATIONAL GOVERNMENT AGENCIES AND LOCAL GOVERNMENT UNITS 
TO UNDERTAKE THE DELIVERY OF BASIC SERVICES FOR THE PURPOSE 
OF PROVIDING EMPLOYMENT TO BARANGAY RESIDENTS AND FOR 
OTHER PURPOSES 
Be it enacted by the Senate and House of Representatives of the Philippines in 
Congress assembled: 
SECTION 
1. 
Short Title. - This Act shall be known as the “The 
Barangay Economic Empowerment Act of 2004.” 
SEC. 2. Declaration of Policy. - It is the policy of the State to transform 
thebarangay into a self-reliant economic unit generating employment for its 
members and actively participating in publicly funded programs intended for the 
barangay. 
SEC. 3. Coverage. - All basic services being contracted out by the 
national government and local government units with private or public contractors 
and which affect the barangays are covered by this Act: Provided, however, That 
the amount of the basic services to be contracted out by the barangay shall not 
be more than Five hundred thousand pesos (P500,000.00). 
SEC. 4. Right of First Refusal. - The provisions o the Local Government 
Code to the contrary notwithstanding, local government units and national 
government agencies shall give priority to the affected barangay in contracting 


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out the delivery of basic services intended for or affecting said barangay. Such 
barangay shall have the right of first refusal before the project is bidded out. 
SEC. 5. Barangay Consortium. - In cases of projects or undertaking 
affecting two or more barangays, the possibility of the barangays concerned 
joining and pooling their resources together shall always be encouraged. 
SEC. 6. Basic Services. - For purposes of this Act, basic services 
programs in which the affected barangay shall have priority right to undertake, 
shall include: 
(a), 
Implementation of community-based forestry programs and similar 
projects; management and control of communal forest with an area not exceeding 
fifty (50) square kilometers; establishment and maintenance of tree parks, green 
belts, and similar forest development project; 
(b) 
Maintenance of community-based rehabilitation programs for 
vagrants, beggars, and street children, scavengers, delinquents, and victims of 
violence and drug abuse; livelihood projects; 
(c) 
and sanitation; 
(d) 
Solid waste disposal system or services related to general hygiene 
Maintenance of public buildings, public parks, playground and 
government sports facilities; 
(e) 
Maintenance of roads, drainage systems, communal irrigation, 
small water impounding and other similar projects; seawalls, dikes, flood control; 
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and street signage; 
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(f) 
Maintenance of public markets and slaughterhouses; 
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(9) 
Maintenance of public cemetery; and 
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(h)' 
Maintenance of tourism facilities and securing such facilities. 
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SEC. 7. Preference of Barangay Labor and Materials. - In the event 
that the barangay concerned is unable for any reason to participate in any project 
within its jurisdiction and/or affecting its residents, the local government unit or 
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national government agency concerned shall exert every effort to source its labor 
and materials from the barangay. 
SEC. 8. Mode of Payment. - A certification duly executed and signed by 
the chairman of the affected barangay and concurred in by the authorized 
signatory for the local government unit or national agency concerned shall form 
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the basis of all claims for payment by the barangay. 
SEC. 9. Unlawful Act. - Any public official who bids andlor contracts out 
the delivery of basic services, as provided in Section 5 hereof, intended for or 
affecting a barangay without giving the affected barangay the opportunity to 
exercise its right of first refusal shall, upon conviction, be punished with 
imprisonment for not less than one (1) year and one (1) day to six (6) years shall 
be immediately dismissed from the service. 
In addition, the public officer shall be liable to reimburse to the affected 
barangay an amount equal to what would have been realized by the barangay 
were it accorded its right under this Act. 
SEC. I O .  Implementing Rules and Regulation. - The Department of 
Interior and Local Government shall, within ninety (90) days from the effectivity of 
this Act, promulgate the appropriate rules and regulations for the effective 
implementation of this Act. 
SEC. 11. Repealing Clause. - All laws, decrees, orders, rules and 
regulations and other issuances inconsistent with the provision of this Act are 
deemed modified, revoked or repealed accordingly. 
SEC. 12. Effectivity. This Act shall take effect fifteen (15) days after its 
publication in two (2) leading newspapers of national circulation 
Approved, 
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