Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City

EIGHTEENTH CONGRESS
First Regular Session

HOUSE BILL No. _2155

Introduced ‘ep. Abdullah D. Dimi and Rep. Mohamad Khalid Q. Dim¢

EXPLANATORY NOTE

This bill seeks to create the Kapatagan Valley Development Authority,
prescribe its powers and functions and appropriate funds therefor.

Kapatagan Valley is located in the southern part of Lanao del Norte and covers
the municipalities of Kapatagan, Lala, Salvador and Sapad, and the peripheral
watershed municipalities of Tubod, Baroy, Nunungan, Magsaysay and Sultan Naga
Dimaporo. These municipalities are among the fastest growing municipalities in the
province and are considered small urban centers serving the hubs of commerce and
trade in Northern Mindanao. The area likewise has the largest settlements after Iligan
City and has a population density that is substantially higher than the provincial
average.

Considered as the rice granary of Lanao del Norte, Kapatagan Valley is
supported by the Maranding Watershed which runs across seven municipalities. The
sources of the watershed include Lakes Penda and Nunungan, Dipolo and Maranding
Rivers, Cathedral, Putadun, Kabugan, Mapurog, Balimbing, Inudaran and
Kapatagan Creeks. Kapatagan Valley is also home to Mount Inayawan Range
Natural Park, a protected area located in the municipality of Nunungan. Both the
watershed and rainforest are crucial to the supply of needed water for irrigation and
drinking in Kapatagan Valley. The area is endowed with rich natural resources that
the community established therein fish sanctuaries, fisheries development zones,
agro-forestry zones, livestock farms, and crop and vegetable plantations. It also has
great potential for tourism for its waterfalls, hot and cold springs and the rainforest.

Given the vast resources of Kapatagan Valley, the local government must
ensure that priorities for its sustainable development are met, namely: infrastructure
support like farm-to-market roads, irrigation, post-harvest facilities, and food
processing facilities; enhanced links between agri-production, processing and
marketing; increased access to capital and a sound housing or settlement program,

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while at the same time preserving the integrity of land use, particularly agricultural

and forest areas, and mitigating the detrimental effects of development to the
protected areas.

There is a need for an authorized entity to govern the affairs of Kapatagan
Valley, especially that it is extremely vulnerable to natural hazards. The Mines and
Geo-sciences Bureau identified the area to have a high probability of occurrence of
rain-induced landslides, floods, flash floods, storm surges and tornadoes due to the
province’s topographic landscape. Hence, a viable program for disaster mitigation,
and public safety and rescue during calamities must be established. There should
only be one body to formulate, implement and provide a comprehensive policy
guideline for the preservation and development of this valley. Hence, the creation of
the Kapatagan Valley Development Authority.

This bill also welcomes the participation of the private sector as members of
the board of directors. Public-private sector partnership is likewise considered as the
government opens up not just management but also financing options.

The Filipino people and generations after them deserve the generous bounty
that Kapatagan Valley has to offer.

To keep Kapatagan Valley from degradation, immediate passage of this bill
is earnestly sought.

SHALIDO. DIMAPORO

DULLAH D. DIMAPORO M A
istrict, Lanao del Norte

2" District, Lanao del Norte


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Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City
EIGHTEENTH CONGRESS
First Regular Session

155
HOUSE BILL NO.

Introduced by: Rep. Abdullah D. Dimaporo and Rep. Mohamad Khalid Q. Dimaporo

AN ACT
CREATING THE KAPATAGAN VALLEY DEVELOPMENT AUTHORITY,
PRESCRIBING ITS POWERS AND FUNCTIONS AND APPROPRIATING
FUNDS THEREFOR

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 “Kapatagan Valley
Development Authority Act.”

SEC. 2. Declaration of Principles and Policies -It is the policy of the State
to protect and advance the right of the people to a balanced and healthful ecology in
accord with the rhythm and harmony of nature. Towards this end, the State shall
promote sustainable development by building a globally competitive, ecology
conscious community of self-reliant and highly efficient people while supporting the
protection, preservation and revival of the quality of our watersheds, mountain
ranges and forest reserves.

The State shall likewise formulate and implement a framework to enhance the
capabilities of the people where they are given equitable access to local resources,

basic social services and economic opportunities while ensuring the implementation,


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management and oversight of the necessary measures and programs on the
protection and preservation of Kapatagan Valley.

SEC. 3. Definition of Terms. — As used in this Act:

a) Discharge includes the act of spilling, leaking, pumping, pouring,
emitting, emptying, releasing or dumping of any material into a water body or onto
land from which it might flow or drain into the water;

b) Effluent refers to sewage passed into a body of water or land or
industrial waste or wastewater flowing out of a manufacturing plant, industrial plant
and domestic household including commercial and recreational facilities; and

c) Geographic Information System(GIS) Mapping refers to computerized
data management system to capture, store, manage, retrieve, analyze, and display
spatial information in which data are geo-referenced to the coordinates of a particular
projection system which allows precise placement of features on the earth’s surface
and maintains the spatial relationships between mapped features such as slope, soils,
hydrography, bathymetry, demography, wetlands and land use which are combined
to develop maps suitable for regulatory and planning decisions.

SEC. 4. Kapatagan Valley Coverage. — The Kapatagan Valley shall consist of
the municipalities of Kapatagan, Lala, Salvador and Sapad, including the peripheral
watershed municipalities of Tubod, Baroy, Nunungan, Magsaysay and Sultan Naga
Dimaporo, in Lanao del Norte.

SEC.5.Kapatagan Valley Development Authority.— There shall be created
under the Office of the President, an independent regulatory body to be known as

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the Kapatagan Valley Development Authority, hereinafter referred to as the
“Authority.” The Authority shall be the primary government agency that shall
coordinate, plan, manage and implement the development programs and resource
utilization in the Kapatagan Valley. The Authority shall execute the powers and
functions vested and conferred by this Act. It shall have its principal office in
Kapatagan, Lanao del Norte and, if necessary, may establish area management

offices (AMOs) to achieve the objectives of this Act.

SEC. 6. General Policies. — In the exercise of its powers and duties, the
Authority is guided by the following policies:

a) The sustainable development and preservation of the Kapatagan Valley
are given due importance to protect and develop the ecological balance within the
area;

b) The preparation, development and implementation of a comprehensive
and detailed Kapatagan Valley Roadmap and Master Plan based on the framework
of sustainable management of watersheds, protected areas, fish sanctuaries and
rainforest shall be prioritized in consultation and coordination with the local
government units (LGUs), Department of Environment and Natural Resources
(DENR), Department of Interior and Local Government (DILG), Department of
Public Works and Highways (DPWH), National Economic Development Authority

(NEDA) and other appropriate government agencies and stakeholders;


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c) The implementation of short and medium-term programs, activities and
projects consistent with the Kapatagan Valley Roadmap and Master Plan to attain
the objectives of this Act;

d) The implementation of environmental laws and regulations, including
Republic Act No. 7586, otherwise known as the “National Integrated Protected Area
System Act of 1992” and Republic Act No. 8435, otherwise known as the
“Agriculture and Fisheries Modernization Act of 1997,” to regulate commercial,
industrial and similar activities within the Kapatagan Valley;

e) The encouragement of the active participation of the LGUs specifically
the barangays in the implementation and enforcement of existing environmental
laws;

f) The participation of the private sector and civil society organizations in
transforming the Kapatagan Valley into a conducive environment for recreation,
business and other productive uses through private sector-driven and cleaner
technology-based investments in ecosystem development;

g) Planning, programming, social preparation and adjustment, relocation
or resettlement of the population within the protected areas of Kapatagan Valley in
coordination with appropriate government agencies and LGUs to ensure that
relocation and resettlement areas have permanent access to adequate basic social

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h) Management and implementation of information and education
campaign to amplify stakeholder awareness and voluntary participation on the
importance of protection and conservation of the Kapatagan Valley in close
coordination with LGUs and other government agencies; and

i) Formulation and implementation of programs, policies and procedures
to achieve public safety, especially preparedness for preventive or rescue operations
during times of calamities and disasters such as earthquakes, floods and mudslides,
as well as coordination and mobilization of resources and the implementation of
contingency plans for the rehabilitation and relief operations in coordination with
the appropriate national agencies.

SEC. 7. Powers and Functions. — The Authority shall exercise the following
powers and functions:

a) Formulate and implement the comprehensive Kapatagan Valley
Roadmap and Master Plan with the help of the NEDA and other agencies or entities;

b) _ Review all plans, projects and programs in the Kapatagan Valley and
the expansions thereto including those submitted by LGUs, public corporations,
public utility franchisees, concessionaires, private persons or corporations that relate
to the development of the Kapatagan Valley to ensure that they conform to
environmental standards prescribed by the Authority and other environmental laws;

c) Through coordination with the DPWH and other appropriate
government agencies, implement infrastructure projects for water supply, among
others, post-harvest irrigation, food processing, flood control, solid waste

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management, wastewater and sewerage works, water supply facilities, access roads,
access ports, housing, leisure parks and related works within the context of its master
plan including the readjustment, relocation or resettlement of population within the
Kapatagan Valley that may be deemed necessary and beneficial in pursuit of its
mandate. In case any of these projects is financed wholly or in part by the Authority,
it shall collect fees and tolls from users or beneficiaries to recover costs of
construction and maintenance of the projects;

d) Periodically conduct comprehensive scientific surveys, studies, field
sampling and laboratory testing, and Geographic Information System (GIS)-
mapping of the Kapatagan Valley, in coordination with the Department of Science
and Technology (DOST), DENR-Environmental Management Bureau (EMB),and
National Mapping and Resource Information Authority (NAMRIA) to monitor,
evaluate, update and analyze among others, the physical, biological, chemical,
geological characteristics including the socio-economic profile of stakeholders,
trade, industrial and commercial profile of business entities, status of the national
government agency and LGU programs and projects, biometric tagging and
identification of settlers, parcellary land use and zoning aspects, mapping of critical
effluent discharge areas, transportation and navigation attributes, and historical and
tourism elements;

©) Engage the services of the private sector through the Public-Private
Partnership (PPP) process or through the Build Operate and Transfer (BOT) Scheme
under Republic Act No. 6957, entitled “An Act Authorizing the Financing,


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Construction, Operation and Maintenance of Infrastructure Project by the Private
Sector, and For Other Purposes” as amended or other acceptable forms of
partnership and agreements in establishing an environmental, biological or
microbiological laboratory, GIS-mapping system, surveillance, monitoring and
enforcement system through high-definition closed circuit televisions or other
surveillance and monitoring technologies and new technologies on highly-
specialized fields;

f) _ Engage in land swapping in securing relocation and resettlement areas,
whether by itself or in cooperation with private persons or entities, enter into other
acceptable exchange agreements related to social and ecological development
Projects;

g) Identify, secure and possess near-site or on-site development areas for
low-cost and socialized mass housing of qualified informal settler families;

h) Engage in experimental community-based integrated waste
management technologies and strategies including the collection and disposal
system, sewage and septage treatment, collection and disposal of floating garbage,
solid waste, wastewater by-products, sludge or contaminated sediments;

i) Clear and dismantle all illegal structures, in coordination with the local
government units, DILG and Philippine National Police (PNP), and ensure that the
easements provided for in this Act and other related laws are enforced;

jp Conduct, in close coordination with the DENR, DOST, the academe
and other private and public research institutions, continuing research and

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development programs on environmental management technologies, integrated
agricultural management models and techniques, and appropriate aquaculture
technologies, with the end view of promoting sustainable development;

k) _ Without prejudice to existing environmental laws, establish and enforce
anti-pollution standards on domestic, municipal, commercial and industrial waste
being discharged into the Kapatagan Valley watershed and river system;

1) Require all projects or activities affecting the Kapatagan Valley to
secure environmental compliance certificates (ECCs) required under Presidential
Decree No. (PD)1586 entitled “Establishing An Environmental Impact Statement
System, Including Other Environmental Management Related Measures and For
Other Purposes” and grant clearances and permits for projects and activities within
or affecting the Kapatagan Valley including industrial and commercial activities,
recreation and tourism, navigation, housing and other forms of land developments,
construction and operation and impose necessary safeguards, management and
control of waste and collect necessary fees for such activities and projects;

m) _ Issue, renew or cancel permits, subject to reasonable guidelines, for the
discharge of sewage, septage, industrial waste and installation or operation of
sewerage works and industrial disposal systems or parts thereof, for the prevention
and abatement of pollution;

n) Issue, after due notice and hearing, orders or decisions to compel
compliance with the provisions of this Act and its implementing rules and
regulations;

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0) Issue, alter or modify, after due notice and hearing, orders or decisions
requiring the discontinuance of pollution specifying the conditions and the time
within which such discontinuance must be accomplished;

p) Revoke, suspend or modify, after due notice and hearing, any clearance
or instrumentalities for the purpose of enforcing the provisions of this Act and its
implementing rules and regulations;

q)  Deputize or request the assistance of appropriate government agencies
or instrumentalities for the purpose of enforcing the provisions of this Act and its
implementing rules and regulations and the orders and decisions of the Authority;

1) Enter, inspect or investigate at all reasonable times any public and
private property devoted to commercial and industrial use within the Kapatagan
Valley, on any matter relating to pollution and existing or imminent environmental
hazard and danger;

s) Fix, impose, collect, periodically review and adjust reasonable fees and
other related charges for services rendered in the performance of its mandate; and

i) Exercise powers and perform other functions as may be necessary to
carry out its duties and responsibilities under this Act.

SEC. 8. Corporate Powers. — The Authority shall exercise the following
corporate powers:

a) Succeed in its corporate name;
b) Sue and be sued in its corporate name;
c) Adopt, alter and use a corporate seal;

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d) Adopt, amend or repeal its bylaws;

e) — Enter into, make, perform and carry out contracts of any class,
kind and description with any person, firm or corporation, private or public and with
foreign government entities which are necessary or incidental to the realization of its
purpose;

f) Acquire, buy, purchase, hold or lease personal and real property
as it deems necessary or convenient in the transaction of its business, or to lease,
mortgage, sell, alienate or otherwise encumber, utilize, exploit or dispose of any such
personal and real property held by the Authority, subject to prior or existing
individual or communal right of private parties, the government, any agency or
enterprise thereof. No real property within the Kapatagan Valley shall be sold or
disposed of without the approval of the President of the Philippines;

g) _ Receive and utilize donations, grants, bequeaths and assistance
of all kinds from local and foreign governments and private sectors;

h) Exercise the right of eminent domain whenever the Authority
deems it necessary to carry out the objectives under this Act;

i) Borrow funds from any local or foreign sources independent of
the bonds it may issue to carry out the purposes of this Act;

j) Purchase, hold, alienate, mortgage, pledge or otherwise dispose
of the shares of the capital stock or any bond, securities or other evidence of
indebtedness created by any other corporation, co-partnership or government
agencies or instrumentalities. The Authority shall not invest its funds in any high-

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risk instruments or in any highly speculative stocks issued without recourse to
commercial banks or investment houses;

k) Provide incentives to encourage the private sector to fully
subscribe to its shares of stock;

1) Perform any acts which a corporation or a juridical person is
authorized to perform under the existing laws; and

m) Issue such other rules and regulations as may be deemed
necessary to carry out the purposes of this Act.

SEC. 9. Board of Directors. — The corporate powers of the Authority shall be
vested in and exercised by a Board of Directors, hereinafter referred to as the Board,
which is composed of the following:

a) General manager of the Authority, as chairperson;

b) _ Secretary of the DENR, as ex-officio vice-chairperson;

c) Secretary of the DPWH, as ex-officio member;

d) — Secretary of the DILG, as ex-officio member;

e) A representative from the Office of the Governor of the Province
of Lanao del Norte; and

f) Two (2) representatives from the private sector who are
shareholders or stakeholders in the Kapatagan Valley, as members.

The ex-officio members of the Board may designate the officer next in rank as

a permanent alternate representative to the Board.

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The appointment and qualification of the members of the Board shall be in
accordance with the provisions of Republic Act No. 10149, otherwise known as the
“GOCC Governance Act of 2011.” The Governance Commission for Government-
Owned or-Controlled Corporations shall give utmost consideration to the nominees
recommended by the general manager. The general manager shall recommend at
least three (3) names for every vacant position.

SEC. 10. Powers and Functions. — The Board shall exercise the following
powers and functions:

a) Provide a comprehensive policy guidance for the sustainable
development and preservation of the Kapatagan Valley;

b) Prescribe and promulgate policies, rules and regulations to govern the
conduct of business of the Authority and ensure that the Authority performs its
functions in a proper, efficient and effective manner;

©) Decide the objectives, strategies and policies of the Authority in
accordance with the provisions of this Act;

d) Exercise appellate powers on the decision of the general manager;

e) __ Issue subpoena ad testificandum or subpoena ducestecum requiring the
attendance and testimony of witnesses in any matter or inquiry pending before the
Board and requiring the production of books, papers, contracts, agreements and all

other documents;

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f) Exercise appellate powers to order the taking of depositions at any stage
of any proceeding or investigation pending before the Board;

g) Approve the organizational and administrative structures and the
corresponding staffing pattern of the Authority; fix their reasonable compensation,
allowances and other benefits in accordance with the Salary Standardization Law;
prescribe their duties and establish such methods and procedures as may be
necessary to ensure the efficient, honest and economical administration of the
provisions and purposes of this Act. All personnel of the Authority shall be appointed
by the general manager. Those personnel with the rank of assistant manager down
to department heads, and others of comparable rank, shall be subject to the
confirmation of the Board: Provided, That the personnel of the Authority shall be
selected only from those with civil service eligibility and shall be subject to civil
service laws, rules and regulations;

h) Approve the annual and supplemental budgets of the Authority and
authorize each operating and capital expenditure and disbursement as may be
necessary for the effective management, operation and administration of the
Authority;

i) Create and organize ad-hoc technical working groups composed of
representatives from the government and other stakeholders to assist the Board; and

j) Perform such other functions as may be necessary to carry out the

provisions of this Act.

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SEC. 11. Quorum. — The presence of at least five (5) members of the Board
shall constitute a quorum and the majority vote of at least four (4) members in a
meeting where a quorum is present shall be necessary for the adoption of any ruling,
order, resolution, decision or act of the Board in the exercise of its functions.

SEC. 12. Board Meetings. — The Board shall meet regularly once a month and
may hold special meetings to consider urgent matters upon the call of the chairperson
or upon the initiative of five (5) members. The rules and procedures in the conduct
of Board meetings shall be prescribed by the Board.

SEC. 13. Per Diems. — The members of the Board shall receive a per diem for
each meeting actually attended. The per diems of the members of the Board shall be
determined by the Board in accordance with the existing rules and regulations.

SEC. 14. General Manager. —A general manager who is the chief executive
officer of the Authority shall exercise the following powers and functions:

a) Submit for consideration of the Board, the policies and measures that
are necessary to carry out the purposes and objectives of this Act;

b) Head and administer the Kapatagan Valley Adjudication Panel as the
implementing arm for the quasi-judicial powers of the Authority;

c) Execute, administer and implement the policies, plans, programs and
projects approved by the Board;

d) Manage and supervise the operation and administration of the

Authority;

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e) Appoint all officials and employees of the Authority and remove,
suspend or otherwise discipline the same for cause, in accordance with existing civil
service laws, rules and regulations;

f) Submit quarterly reports to the Board on personnel selection, placement
and training;

g) Render an annual report to the Board and various stakeholders
regarding the operation of the Authority including its latest financial statements;

h) Represent the Authority in all its dealings with offices, agencies, and
instrumentalities of the government and with all persons and other entities, public or
private, domestic and foreign; and

i) _ Perform such other functions as may be provided in the bylaws and as
may be vested by the Board.

The general manager shall be vested with the rights, privileges,
disqualifications and prohibitions of a general manager as prescribed by existing
Position Classification and Compensation Scheme, laws, issuances and pertinent
civil service rules and regulations.

SEC. 15. Qualifications. — The general manager must be:

a) A citizen and resident of the Philippines;

b) At least thirty-five (35) years of age;

c) With good moral character, unquestionable integrity and recognized

competence; and

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d) Adegree holder with at least five (5) years supervisory or management
experience in the field of public administration, economic planning, environmental
planning and natural resource management, or in the establishment and management
of large agricultural, commercial or industrial enterprises or other related fields.

SEC. 16. Term of Office. — The general manager shall be appointed by the
President of the Philippines and shall have a term of six (6) years which may be
extended for another non-extendible term of two (2) years. The general manager may
only be removed for cause in accordance with the rules and regulations prescribed
by the Civil Service Commission.

SEC. 17. Management Structure. — In carrying out the activities of the
Authority, the general manager shall be assisted by an assistant general manager and
four (4) department heads: one (1) for legal services, one (1) for administration and
finance services, one (1) for technical services, and one (1) for agricultural
development, who shall have such powers, duties and functions as the general
manager may prescribe or delegate. The assistant general manager shall act as the
general manager in the absence or during the temporary incapacity of the general
manager or until such time that a new general manager has been duly appointed.

The Authority shall have the following departments under the direct
supervision and control of the general manager:

a) Enforcement and Legal Service Department which shall provide legal
advice and support to all the corporate units on legal implications of the various
undertakings of the Authority. It shall also provide professional assistance in the

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implementation of the quasi-judicial and regulatory functions of the Authority,
which includes enforcement of environmental protection, proper procedures on
investigation, litigation, adjudication and voluntary arbitration. It shall oversee and
manage the operations of the watershed, forestry zones, rainforest and fish sanctuary
surveillance, monitoring and enforcement units within the Kapatagan Valley;

b) Administrative and Finance Department which shall be responsible for
providing services related to administrative support services such as consolidation
of major financial output, preparation of personnel evaluation system, human
resource management, revenue planning, generation and enhancement, budget and
financial matters, records management, safekeeping of financial assets, and general
services;

c) Technical and. ‘Environmental Management Services Department which
shall serve as the main regulatory and technical arm of the authority and shall oversee
the integration of the functions on environmental management and development,
including the management and operations of the GIS-mapping unit and laboratories.
It shall also be responsible for providing scientific studies, technical policy planning,
research and development, and technology management services; and

d) Agricultural Development Department which shall be responsible for
the promotion and management of agricultural activities in the area, including
dissemination of information and educational campaign to residents, particularly the
farmers, to help them maximize their earning potential while maintaining ecological

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SEC. 18. Power to Administer Oaths. - The members of the Board, the
general manager and other duly designated officers of the Authority, shall have the
authority to administer oaths in the transaction and performance of their official
duties.

SEC. 19. Consultative Assembly. — There shall be established a consultative
assembly which shall serve as venue for public consultations and participation by
stakeholders and presentation of the Authority’s plans and programs or modification,
amendment or revision of rules and regulations prior to its adoption or
implementation within its jurisdiction. The consultative assembly is composed of the
following:

a) Mayors of the municipalities comprising the Kapatagan Valley;

b) The president of the association of barangay captains in municipalities
comprising the Kapatagan Valley;

od A representative of owners, proprietors and authorized operators of all
major private, commercial or industrial business establishments located in all
barangays comprising the Kapatagan Valley; and

d) One (1) representative each for the homeowners associations, civil
society organizations and peoples’ organizations in the Kapatagan Valley.

The Authority shall convene an annual year-end general assembly to report
and present its financial and fiscal status and updates on its plans, programs and

projects to its stakeholders and to the public. The required logistical support, such as

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food and transportation allowances shall be provided to the members of the Board
and the consultative assembly during the meeting at the expense of the Authority
subject to government accounting and auditing procedures.

SEC. 20. Enforcement Powers. — The Authority shall have enforcement
powers within Kapatagan Valley to carry out the functions and attain the purposes
and objectives declared under this Act. The grant ‘of such powers shall be in
conformity with the functions exclusively provided by law to be exercised by the
PNP and other government agencies. The Authority may request the assistance of
other law enforcement agencies, including request for deputation as may be required.

SEC. 21. Power to Investigate Violations. — The general manager,
motuproprioor at the instance of a private person or the Board, may conduct
investigations based on the procedures that the Board may prescribe in accordance
with the provisions of the Rules of Court serving as supplemental guidelines.

SEC. 22. Cease and Desist Order. — The general manager, after due
investigation, may issue a cease and desist order to immediately halt any practice
found to be in violation of the provisions of this Act. Such order shall be without
prejudice to the civil or criminal prosecution of persons under the existing laws.

SEC. 23. Kapatagan Valley Adjudication Panel. — To carry out effectively
the quasi-judicial powers of the Authority, there shall be created a Kapatagan Valley
Adjudication Panel, hereinafter referred to as the “Adjudication Panel.” The

Adjudication Panel is composed of the general manager as the head, one (1) ex-

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officio board member and one (1) board member from the private sector, to be elected
by the board members from among themselves.

The Adjudication Panel shall have the following powers and functions:

a) Issue preliminary or permanent injunctions whether prohibitory or
mandatory, in all cases in which it has jurisdiction;

b) Issue subpoena and subpoena ducestecum and to summon witnesses to
appear in any proceedings of the Adjudication Panel, and administer oaths and
affirmations;

c) Punish for contempt, both direct and indirect, in accordance with the
pertinent provisions of and the penalties prescribed by the Rules of Court;

d) Conduct investigations and hearings on the complaints for violation of
the environmental laws and of this Act, issue show cause orders, decisions or ruling
and impose fines and penalties for such violations;

e) _ Issue notices of violations or non-compliance, cease and desist orders
and other related orders necessary for the enforcement of existing environmental
Jaws and rules and regulations of this Act;

The Adjudication Panel is mandated to take cognizance and adjudicate
violations of this Act. Any decision, order or resolution shall be concurred in by the
majority members of the panel and duly signed by the general manager. The
decision, order or resolution of the Adjudication Panel may be appealed to the Board

within fifteen (15) days from receipt of the decision, order or resolution. The

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decision of the Board may be further appealed to any court of competent jurisdiction
in accordance with the provisions of the Rules of Court.

SEC. 24. Clean-Up Operations. — In addition to the provisions of Section 25
hereof, any person who causes pollution in or pollutes the Kapatagan Valley in
excess of the applicable and prevailing standards is responsible to contain, remove
and clean-up any pollution incident at the polluter’s own expense: Provided, That in
the event emergency clean-up operations are necessary and the polluter fails to
immediately undertake the same, the Authority, in coordination with other
government agencies concerned, shall conduct containment, removal and clean-up
operations. Expenses incurred in the operations shall be reimbursed by the persons
found to have caused such pollution upon proper administrative determination in
accordance with this Act. Reimbursements of the cost incurred shall be made to the
Authority’s fund for the development of the Kapatagan Valley.

SEC. 25. Prohibited Acts. ~The following acts are prohibited:

a) Unauthorized transport or dumping of sewage sludge, solid waste, or
commercial, industrial and institutional waste into the Kapatagan Valley and its
watersheds, fish sanctuaries, tributaries and waterways;

b) Transporting, dumping or discharging of prohibited chemicals, toxic
substances, hazardous and nuclear waste into the Kapatagan Valley and its
watersheds, fish sanctuaries, tributaries and waterways;

c) _ Refusal to allow entry, inspection and monitoring by the Authority;


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d) Refusal to allow access by the Authority to relevant reports and records;

e) Refusal or failure to submit reports whenever required by the Authority;

f) Refusal or failure to designate pollution control officers whenever
required by the Authority in accordance with this Act;

g) Operating facilities and discharging regulated solid or water pollutants
without the valid required permits or under a revoked permit in violation of any
condition imposed by the Authority;

h) _ Disposal of potentially infectious medical waste into the Kapatagan
Valley and its watersheds, fish sanctuaries, tributaries and waterways; and

i) Undertaking activities, development and expansion projects or
operating wastewater and sewerage facilities in violation of Environmental Impact
Statement System established under PD1586 and its implementing rules and
regulations.

SEC. 26. Penal Clause. — Any person who commits any of the prohibited acts
mentioned in Section 25 hereof or any rule and regulation promulgated pursuant
thereto shall be punished by imprisonment of not Jess than two (2) years but not more
than four (4) years or a fine of not less than Fifty thousand pesos (P50,000.00) but
not more than One hundred thousand pesos (100,000.00), or both. In case of failure
or refusal to undertake clean-up operations mentioned in Section 24 hereof, any
person who, willfully or through gross negligence causes serious injury, loss of life,

or irreversible water contamination of surface or ground water, shall be punished

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with imprisonment of not less than six (6) years and one day to not more than twelve
(12) years or a fine of Five hundred thousand pesos (P500,000.00) per day for each
day during which the omission or contamination continues.

If the offender is a corporation or @ juridical person, the officers thereof who
have knowingly participated in the violation shall be held liable.

SEC. 27. Incentives. — The Authority may provide incentives to industries and
commercial enterprises that undertake necessary measures to abate pollution within
the Kapatagan Valley and to the government agencies involved in the construction
of parks, river control structures, anti-pollution devices, contraptions, appurtenances,
bio-remediation and containment systems, cleaner technology systems for
wastewater treatment and sewerage facilities and solid-waste and garbage disposal
systems, and other related equipment.

Investment incentives shall be provided by the Authority to the industries,
organizations and persons whose activities enhance the utilization of the Kapatagan
Valley and its environs such as clean-up operations, recreation, tourism and other
programs that revive, improve and enhance the ecological system of the Kapatagan
Valley.

SEC. 28. Annual Fees. — The Authority shall collect annual fees from private
business establishments, individual or corporation, whose solid waste or wastewater
disposal facilities are connected to the sewerage system located within the
Kapatagan Valley. The fees collected shall be used solely for the sustainable
development of the Kapatagan Valley.

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SEC. 29. Fiscal Autonomy. — The Authority shall enjoy fiscal autonomy. All
funds earned by the Authority from the collection or levy or from all fees, charges,
dues, assessments and fines collected pursuant to this Act shall be used solely to fund
its operations.

SEC. 30. Capitalizations and Financing. — The Authority shall have an
authorized capital of Four hundred million pesos (P400,000,000.00). The authorized
capital shall be divided into two million (2,000,000) shares of stock with a par value
of Two hundred pesos (P200.00) per share. The National Government shall fully
subscribe to ninety percent (90%) of the authorized capital, of which at least fifty
percent (50%) shall have been fully paid; while ten percent (10%) of the shares shall
be subscribed and paid by the Provincial Government of Lanao del Norte.

SEC. 31. Funding. - The amount necessary to subscribe and pay for the
remaining shares of the National Government to the capital stock of the Authority
shall be included in the annual General Appropriations Act. For the Provincial
Government of Lanao del Norte, the funds for subscription shall be taken from their
intemal revenue allotment and other local funds.

SEC, 32. Exemption from Taxes, Customs and Tariff Duties. — The
importation of equipment, machineries, spare parts, accessories and other materials
including supplies and services which are used solely and exclusively for the
operations of the Authority and are not available locally shall be exempt from all
direct and indirect taxes, fees and other charges. All obligations entered into by the
Authority and any income derived therefrom, including those contracted with private

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international banking and financial institutions shall be exempt from all taxes
including the principal and the interest. The Authority is also exempt from the
payment of capital gains tax, documentary stamp tax, real property estate tax and all
other local government taxes and fees.

SEC. 33. Auditor. — The chairperson of the Commission on Audit (COA) shall
be the ex-officio Auditor of the Authority. For this purpose, the chairperson of COA
may appoint a representative and the necessary personnel who shall audit the
Authority.

‘All accounts and expenses of the Authority shall be audited by the
Commission on Audit or its duly authorized representative.

SEC. 34. Joint Congressional Oversight Committee. — There is hereby
created a Joint Congressional Oversight Committee to monitor the implementation
of this Act. The oversight committee shall be composed of five (5) Senators and five
(5) Representatives to be appointed by the Senate President and the Speaker of the
House of Representatives, respectively. The oversight committee shall be co-chaired
by the chairpersons of the Committee on Environment of the Senate and the
Committee on Ecology of the House of Representatives.

SEC.35. Implementing Rules and Regulations. — Within ninety (90) days
from the approval of this Act, the Board shall issue the necessary rules and
regulations for the effective implementation of this Act. The implementing rules and
regulations shall be published in the Official Gazette or in a newspaper of general
circulation.

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SEC. 36. Repealing Clause. — All laws, decrees, executive orders, rules and
regulations and issuances, or parts thereof, inconsistent with the provisions of this
‘Act are hereby repealed accordingly.

SEC. 37. Separability Clause. — If any provision of this Act is declared
unconstitutional or invalid, the other provisions not otherwise affected shall remain
in full force and effect.

SEC. 38. Effectivity. - This Act shall take effect fifteen (15) days after its
publication in the Official Gazette or in a newspaper of general circulation.

Approved