SEVENTEENTH CONGRESS OF THE )
REPUBLIC OF THE PHILIPPINES )
Second Regular Session )

‘18 APR 26 P3:42

SENATE

s.B.No. 1789 Ree po.

Introduced by Senator SONNY ANGARA

AN ACT
TO ENHANCE THE USE OF NATIONAL WEALTH FOR LOCAL DEVELOPMENT BY
AMENDING CERTAIN PROVISIONS IN BOOK II OF REPUBLIC ACT 7160,
OTHERWISE KNOWN AS THE LOCAL GOVERNMENT CODE OF 1991

EXPLANATORY NOTE

Republic Act 7160—otherwise known as the Local Government Code—provides that
Local Government Units (LGUs) must have a share in the proceeds from the
development and utilization of national wealth located in its boundaries (Sec. 289). This,
share is forty percent (40%) of “gross collections, derived by the national government
from the preceding fiscal year from mining taxes, royalties, forestry and fishery charges,
and such other taxes, fees, or charges including related surcharges or fines” (Sec. 290).
The proceeds from these collections shall be used to finance local development and
livelinood project except where the proceeds are from energy sources such as
hydrothermal and geothermal where their use is restricted to lowering the cost of
electricity in the community (Sec. 294).

This restriction has not only limited the efficient use of the resource but may have led
to non-priority projects aimed at lowering the cost of electricity if only to utilize the funds.
It is therefore recommended that this restriction on the use of proceeds from the
development and utilization of energy sources be removed to allow the LGUs to apply
the funds to more critical projects, program activities identified and prioritized in their
medium-term investment program and annual investment program.

In view of the foregoing, approval of this measure is earnestly sought.

nn
INY ANGARA



SEVENTEENTH CONGRESS OF THE )

REPUBLIC OF THE PHILIPPINES )
Se d Regular St
‘econd Regular Session ) "18 497 26 p3:42
SENATE RECEIVEL 4
$.B.No. 1789

Introduced by Senator SONNY ANGARA

AN ACT
TO ENHANCE THE USE OF NATIONAL WEALTH FOR LOCAL DEVELOPMENT
BY AMENDING CERTAIN PROVISIONS IN BOOK II OF REPUBLIC ACT 7160,
OTHERWISE KNOWN AS THE LOCAL GOVERNMENT CODE OF 1991

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

SECTION 1. Section 294 of Republic Act No. 7160, otherwise known as the
Local Government Code of 1991, hereinafter referred to as the “Code”, is hereby
amended to read as follows:

“SEC. 294, Development and Livelihood Projects. - The proceeds from the
share of local government units pursuant to this chapter shall be appropriated
by their respective sanggunian to finance local government and livelihood
projects IN THE APPROVED LOCAL DEVELOPMENT INVESTMENT
PROGRAM AND ANNUAL INVESTMENT PROGRAM: Provided,-however,

SEC. 2. Repealing Clause. — All general and special laws, acts, city charters,

decrees, executive orders, proclamations and administrative regulations, or part or



parts thereof which are inconsistent with any of the provisions of this Act are hereby
repealed or modified accordingly.

SEC. 3. Separability Clause. - \f, for any reason or reasons, any part of
provision of this Act shall be held unconstitutional or invalid, other parts or provisions

hereof which not affected thereby shall continue to be in full force and effect.

SEC. 4. 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,