FOURTEENTH CONGRESS OF THE 
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First Regular Session 
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REPUBLIC OF THE PHILIPPINES 
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7 SEp 1 1 /.s3;2 :y2 
SENATE 
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Introduced by Senator JUAN MIGUEL F. ZUBIRI 
EXPLANATORY NOTE 
This bill seeks to exempt capital towns of provinces from the income requirement 
prescribed under Republic Act No. 7160 as amended by Republic Act No. 9009. The 
amendatory law significantly increased the income requirement from Twenty Million 
Pesos (P20,000,000.00) to One Hundred Million (€‘lOO,OOO,OOO.OO) for a municipality or 
cluster of barangays to be converted into a city. 
This measure seeks to automatically convert capital towns of provinces into cities 
provided there is no city within the province yet. The capital town must have an income, 
for the last two (2) consecutive years, of at least Eighty Million Pesos (PSO,OOO,OOO.OO). 
Obviously, the intent is to empower the provinces as they shall then have higher 
shares in the Internal Revenue Allotment. Greater autonomy in the collection and fiscal 
administration of local and real property taxes will allow the provincial government to 
efficiently and effectively deliver basic services. Moreover, the elevation of capital towns 
in the level of a city will certainly attract foreign investments. 
Development in the periphery rather than at the center is a concept that is 
consistent with people empowerment. Those who labor in the countryside need to be told 
that the government is aware and cognizant of their contribution to the national economy. 
Expectedly, with the passage of this bill, they shall reap in real terms what they, after all, 
have been giving to this country. 
In view hereof, immediate approval of this bill is highly recommended. 


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FOURTEENTH CONGRESS OF THE 
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REPUBLIC OF THE PHILIPPINES ) 
7 
SEP 1 1 ;~fi,; :ti9 
First Regular Session 
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SENATE 
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Introduced by Senator JUAN MIGUEL F. ZUBIRI 
AN ACT 
TO EXEMPT FROM THE INCOME REQUIREMENT CAPITAL TOWNS OF 
PROVINCES SUBJECT TO CERTAIN CONDITIONS, AMENDING FOR THE 
PURPOSE SECTION 450 OF REPUBLIC ACT No. 7160, AS AMENDED BY 
REPUBLIC ACT No. 9009, OTHERWISE KNOWN AS THE LOCAL 
GOVERNMENT CODE OF 1991 
Be it enacted by the Senate and the House of Representatives of the Philippines in Congress 
assern bled: 
SECTION 1. Section 4.50 of Republic Act No. 7160, as amended by Republic Act No. 
9009, is hereby further amended to read as follows: 
"Section 450. Requisites for Creation. - (a) A municipality of a cluster of barangays may 
be converted into a component city if it has a locally generated average annual income, as certified 
by the Department of Finance, of at least One hundred million pesos (Pl00,000,000.00) for the 
last two (2) consecutive years based on 2000 constant prices, and if it has either of the following 
requisites: 
(i) 
a contiguous territory of at least one hundred (100) square kilometers. As certified 
by the Land Management Bureau; or 
a population of not less than one hundred fifty thousand (1.50,000) inhabitants, as 
certified by the National Statistics Office. 
(ii) 
THE INCOME REQUIREMENT PRESCRIBED HEREIN SHALL NOT APPLY TO 
CAPITAL T O W S  OF PROVINCES SUBJECT TO THE FOLLOWING CONDITIONS: 
(a) THE CAPITAL TOWN IS LOCATED IN A PROVINCE WITHOUT A CITY; AND 
(b)IT HAS AN AVERAGE ANNUAL INCOME, AS CERTIFIED BY THE 
DEPARTMENT OF FINANCE, OF AT LEAST EIGHTY MILLION PESOS 
(P80,000,000.00) FOR THE LAST TWO (2) CONSECUTIVE YEARS BASED ON 
2000 CONSTANT PRICES. 
The creation thereof shall not reduce the land area, population and income of the original 
unit or units at the time of said creation to no less than the minimum requirements prescribed 
herein. 


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SECTION 2. Plebiscite. - Existing capital towns are hereby converted into component 
cities upon approval by a majority of the votes cast in a plebiscite to be held in the said capital 
towns. The Department of Interior and Local Government (DILG) shall submit to the Commission 
on Elections (COMELEC) the list of capital towns, which qualify under this Act. 
The COMELEC shall conduct and supervise such plebiscite in qualified capital towns 
within sixty (60) days upon submission of the income as certified by the Department of Finance. 
The expenses for such plebiscite shall be borne by the capital towns concerned. 
SECTION 3. Applicability ofLaws. - The provisions of Republic Act No, 7160 otherwise 
known as the Local Government Code of 1991, and other laws as are applicable to cities shall 
govern the capital towns, which are converted into cities under the immediately preceding Section, 
in so far as they are not inconsistent with the provisions of this Act. 
SECTION 4. Rules and Regulations. -The DILG, in coordination with the Department of 
Finance, shall issue the necessav rules and regulations within thirty (30) days after the effectivity 
of this Act. 
SECTION 5 .  Effectivi@ - This Act shall take effect fifteen (15) days after its complete 
publication in at least two (2) national newspapers of general circulation. 
Approved,