Republic of the Philippines 
HOUSE OF REPRESENTATIVES 
Constitution Hills, Quezon City 
TWENTIETH CONGRESS 
First Regular Session 
HOUSE BILL NO.  ________ 
Introduced by Lone District of Agusan del Norte Representative 
HON. DALE B. CORVERA 
AN ACT 
AMENDING SECTION 285 OF REPUBLIC ACT NO. 7160, OTHERWISE 
KNOWN AS THE “LOCAL GOVERNMENT CODE OF 1991”, AS AMENDED, 
TO INCLUDE AREA OF MUNICIPAL WATERS AS AN ADDITIONAL 
FACTOR 
IN 
DETERMINING 
THE 
SHARE 
OF 
EACH 
LOCAL 
GOVERNMENT UNIT IN THE NATIONAL TAX ALLOTMENT, AND FOR 
OTHER PURPOSES 
EXPLANATORY NOTE 
Republic Act (RA) No. 7160, otherwise known as the Local Government Code of 1991 
(LGC), is the enabling law for Article X of the 1987 Constitution. Through the LGC, a more 
responsive and accountable local government structure was instituted through a system of 
decentralization whereby local government units (LGUs) were given more powers, authority, 
responsibilities, and resources. The process of decentralization proceeded from the national 
government to the LGUs 
Section 6, Article X of the Constitution provides that the local government units shall 
have a just share, as determined by law, in the national taxes which shall be automatically 
released to them. In the LGC, the constitutional provision pertaining to the just share of the 
LGUs in the national taxes is implemented by Chapter I, Title III, Sections 284-288. 
The ruling of the Supreme Court in Mandanas et al. vs. Executive Secretary et al. (G.R. 
Nos. 199802 and 208488) clarified that the share of the LGUs should not be limited to national 
internal revenue taxes alone. Rather, it should include all national taxes, except those that have 
been collected for a specific purpose. 
The Mandanas Ruling solved the issue on the just share of the LGUs as a whole in the 
national taxes, by correcting the phrasing in Section 284 of the LGC. However, this 
representation believes that a deeper issue in Section 285 of the LGC must be addressed. 
Under Section 285, after the determination of the share of LGUs per class (province, 
city, municipality or barangay) has been made, the share of a particular province, city or 
municipality shall be determined on the basis of three factors: i) Population, ii) Land Area, and 
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iii) Equal sharing. But it appears that these factors forgot to consider one critical information -
the fact that the Philippines is an archipelagic country. In fact, more than 50% of all
municipalities and cities in the country are considered coastal.
The current formula for determining the share of each province, city or municipality is 
unfair to the LGUs that have vast municipal waters. Conversely, it greatly favors LGUs that 
are landlock. Coastal LGUs are compelled to provide services, programs and facilities for the 
protection, promotion and maintenance of the municipal waters pursuant to existing laws 
despite the fact that in the current distribution of the national taxes, the area of municipal waters 
is not included or even considered. 
One such law is RA No. 8550, otherwise known as the Philippine Fisheries Code of 
1998, as amended. This law defined “municipal waters” and made municipal/city government 
responsible for the management, conservation, development, protection, utilization, and 
disposition of all fish and fishery/aquatic resources within their respective municipal waters. 
Yet, no corresponding adjustments were made in the aforementioned factors under the LGC to 
cover the expenses brought about by the increase in responsibilities associated with the 
implementation of RA No. 8550. 
Moreover, coastal cities and municipalities are the most exposed to huge damages and 
displacements brought about by strong cyclones, storm surges and tsunamis. In fact, the 
Philippines has consistently ranked first (1st) in the World Risk Index as the most affected 
country from extreme weather events for three consecutive years (2022 to 2024). The World 
Risk Index is a tool used to assess and estimate the disaster risk of a country, using both external 
and internal hazard factors, including cyclones, floods, droughts, sea level rise and societal 
conditions. 
Coastal LGUs, especially those located at the eastern part of the country, unfortunately 
have to deal with typhoons at the time when they are strongest and raging. Coastal LGUs are 
obliged to spend on projects and programs to prevent loss of life and property due to these 
events.  
The hard truth is promotion, protection and preservation of coastal areas entail costs. 
Unfortunately, these costs are not considered by the present distribution of shares to the LGUs 
under Sec. 285 of the LGC. 
This proposed measure aims to provide LGUs with their TRULY JUST SHARE from 
the national taxes. 
In view of the foregoing, approval of this bill is earnestly sought. 
DALE B. CORVERA 
Representative 
Lone District of Agusan del Norte 


Republic of the Philippines 
HOUSE OF REPRESENTATIVES 
Constitution Hills, Quezon City 
TWENTIETH CONGRESS 
First Regular Session 
HOUSE BILL NO.  ________ 
Introduced by Lone District of Agusan del Norte Representative 
HON. DALE B. CORVERA 
AN ACT 
AMENDING SECTION 285 OF REPUBLIC ACT NO. 7160, OTHERWISE 
KNOWN AS THE “LOCAL GOVERNMENT CODE OF 1991”, AS AMENDED, 
TO INCLUDE AREA OF MUNICIPAL WATERS AS AN ADDITIONAL 
FACTOR 
IN 
DETERMINING 
THE 
SHARE 
OF 
EACH 
LOCAL 
GOVERNMENT UNIT IN THE NATIONAL TAX ALLOTMENT, AND FOR 
OTHER PURPOSES 
Be it enacted by the Senate and House of Representatives of the Philippines in Congress 
assembled: 
SECTION 1. Section 285 of Republic Act No. 7160, otherwise known as the Local 
Government Code of 1991, is hereby amended to read as follows: 
“SECTION 285. Allocation to Local Government Units. - The share of 
local government units in the internal revenue allotment shall be collected in the 
following manner: 
(a) Provinces - Twenty-three percent (23%);
(b) Cities - Twenty-three percent (23%);
(c) Municipalities - Thirty-four percent (34%); and
(d) Barangays - Twenty percent (20%)
Provided, however, That the share of each province, city, and 
municipality shall be determined on the basis of the following formula: 
(a) Population - Fifty percent (50%);
(b) Land Area AND AREA OF MUNICIPAL WATERS – (25%); and
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(c) Equal sharing - Twenty-five percent (25%) 
Provided, further, That the share of each barangay with a population of 
not less than one hundred (100) inhabitants shall not be less than Eighty thousand 
(P80,000.00) per annum chargeable against the twenty percent (20%) share of 
the barangay from the internal revenue allotment, and the balance to be allocated 
on the basis of the following formula: 
(a) On the first year of the effectivity of this Code: 
(1) Population - Forty percent (40%); and 
(2) Equal sharing - Sixty percent (60%) 
(b) On the second year: 
(1) Population - Fifty percent (50%); and 
(2) Equal sharing - Fifty percent (50%) 
(c) On the third year and thereafter: 
(1) Population - Sixty percent (60%); and 
(2) Equal sharing - Forty percent (40%). 
Provided, finally, That the financial requirements of barangays created 
by local government units after the effectivity of this Code shall be the 
responsibility of the local government unit concerned. 
For purposes of this Section, Municipal Waters shall include not only 
streams, lakes, inland bodies of water and tidal waters within the 
municipality/city which are not included within the protected areas as defined 
under Republic Act No. 7586 (The NIPAS Law), public forest, timber lands, 
forest reserves or fishery reserves, but also marine waters included between two 
(2) lines drawn perpendicular to the general coastline from points where the 
boundary lines of the municipality/city touch the sea at low tide and a third line 
parallel with the general coastline including offshore islands and fifteen (15) 
kilometers from such coastline. Where two (2) municipalities/cities are so 
situated on opposite shores that there is less than thirty (30) kilometers of marine 
waters between them, the third line shall be equally distant from opposite shore 
of the respective municipalities/cities.” 


SEC. 2. Comprehensive Survey of Municipal Waters. –  The National Mapping and 
Resource Information Authority (NAMRIA) shall conduct a comprehensive survey of all 
municipal waters of the country, which result shall be submitted to the Department of 
Environment and Natural Resources (DENR), Department of Budget and Management (DBM), 
Department of the Interior and Local Government (DILG) and the LGU-NTA Oversight 
Committee within one (1) year from the effectivity of this Act. 
 
SEC. 3. Creation of Oversight Committee – There is hereby created a Congressional 
Oversight Committee, to be referred to as the LGU-NTA Oversight Committee, to be co-
chaired by the Chairpersons of the Committee on Local Government of both Houses and 
composed of additional three (3) members from the Senate and three (3) members from the 
House of Representatives. The members from the Senate shall be appointed by the Senate 
President based on the proportional representation of the parties or coalitions therein with at 
least one (1) Senator representing the minority. The members from the House of 
Representatives shall be appointed by the Speaker also based on proportional representation of 
the parties or coalitions therein with at least one (1) member representing the minority.  
 
The Oversight Committee shall have the power to promulgate its own rules and to 
oversee, monitor, and evaluate the implementation of this Act. It shall likewise determine the 
gaps in the implementation of the law and recommend necessary remedial legislation or 
executive measures. 
 
SEC. 4. Review and Evaluation. – For purposes of determining remedial legislation, 
the LGU-NTA Oversight Committee shall, within two (2) years after the effectivity of this Act, 
conduct a review and evaluation of the impact of this Act. 
 
SEC. 5. Implementing Rules and Regulations. – Within thirty (30) days from the 
effectivity of this Act, the DBM shall, in consultation with DENR, DILG, and other relevant 
government agencies, formulate the rules and regulations for the effective implementation of 
this Act. 
 
SEC. 6. Separability Clause. – If, for any reason, any section, clause or term of this Act 
is held to be illegal, invalid, or unconstitutional, such parts not affected by such declaration 
shall remain in full force and effect. 


SEC. 7. Repealing Clause. – All laws, presidential decrees, issuances, executive orders, 
letters of instruction, rules, and regulations inconsistent with the provisions of this Act are 
hereby repealed or modified accordingly. 
 
SEC. 8. Effectivity Clause. – This Act shall take effect fifteen (15) days after its 
publication in the Official Gazette or in a newspaper of general circulation. 
 
Approved,