.I- 
FOURTEENTH CONGRESS OF THE ) 
REPUBLIC OP THE PHILIPPINES 
) 
First Regular Session 
1 
SENATE 
S. No. 739 
htroduced! by Senator Ramon Eon% Revi!!a, dr. 
EXPLANATORY NOTE 
The Local Water Utilities Administration (LWUA) has been mandated by law to 
establish, finance and administer as well as promote and develop potable water supply 
systems used nationwide. 
To contribute to the Millennium Development Goals W G s )  of the government, LWUA 
proposed an investment program for the period 2005-2015 which will amount to P97.6 
billion, of which an estimated 40% or P39 billion represents the required peso counterpart 
to be sourced from the inadequate LWUA capitalization. In the absence of the GAA 
funds, LWUA intends to source the peso requirement from other local funding source. 
Hence, the need to immediately and drastically increase the agency’s capitalization from 
P2.5 billion to P50 billion. 
After more than thirty years since it was created, LWUA has formed a total of 400 water 
districts covering 680 cities and towns throughout the country. However, this only 
accounts for only 15 percent or roughly 13.5 million Filipinos served of the country’s 
projected 2007 population of 88.7 million (based on NSO data). With this data, 85 
percent of the residents in the countryside have no access to suficient supply of safe and 
potable water. 
While the agency remains committed to provide continuing financial and technical 
assistance to its clientele (the local water districts), specifically to the less credit-worthy 
water service providers, the lack of capitalization restricts the agency’s delivery of 
services unless remedial legislation is enacted, 
This bill, therefore, seelts to increase the authorized capitalization of L W A  from P2.5 
billion to P50 billion to be able to fixther respond to the growing need of providing 
potable water to every Filipino in the country. 
In cognizance of the urgency and importance of this measure, its passage its earnestly 
sougl1t. 


FOURTEENTH CONGRESS OF THE 
) 
REPUBLIC OF THE PHILIPPINES 
) 
SENATE 
s. No. 737 
Introduced by Senator Ramon Bong Revilla, Jr. 
AN ACT FURTHER AMENDING PRESIDENTIAL DECREE NO. 
198, 
OTHERWISE KNOWN AS THE PROVINCIAL WATER UTILITIES ACT, AS 
AMENDED, PROVIDING FUNDS THEREFOR AND FOR OTHER PURPOSES 
Be it enacted by the Senate arid the House of Representatives of the Philippines in 
Congress assenzbled: 
SECTION 1. Section 67 of Presidential Decree 198, as amended, is hereby amended to 
read as follows: 
“SEC. 67. Capital Stock. 
~ 
The authorized capital stock of the Local Water 
Utilities Administration is FIFTY BILLION PESOS (P50,000,000,000.00) [two billion 
five hundred million pesos) divided into ONE HUNDRED TWENTY FIVE MILLION 
[twelve million five hundred thousand] shares of stocks with a par value of FOUR [two] 
hundred pesos per share which shall be subscribed by the National Government and 
opened to subscription by private investors or government financial institutions: 
PROVIDED, HOWEVER, THAT GOVEJXNMFiNT FINANCIAL, INSTITUTIONS MAY 
INVEST AT LEAST ONE PERCENT (1%) BUT NOT MORE THAN FIVE PERCENT 
(5%) OF THEIR NET lNCOME FOR STOCK SUBSCRIPTION AS PROVIDED FOR 
UNDER THIS ACT: PROWDED, FURTHER, THAT THE ADMWlSTRATION 
SHALL TAKE ACTIVE STEPS FOR THE PU3LIC OFFERING OF ITS SHARES.” 
SEC. 2. Section 72 of Presidential Decree No. 198 shall hereby be amended to read as 
follows: 
“SEC. 12. Domestic AND FOREIGN Borrowing Author@ - The Administration 
shall have the authority to borrow money from all domestic loan sources whether 
government or private: Provided, That its loans outstanding from domestic sources at any 
one time shall not exceed one billion pesos, AND IN THE CASE OF FOREIGN 
(US$1,000,000,000.00): PROVIDED, HOEEVER, TIIAT THE ADMLNISTRATLON 
MAY ONLY PROCEED OR AVAIL OF FOREIGN LOANS WITH PRIOR 
CLEARANCE AND APPROVAL OF THE DEPARTMENT OF FINANCE: 
PROVIDED, FURTHER, THAT THE ADMlNSTRATION MAY CONVERT ITS 
AUTHORIZED FOREIGN DEBT INTO PESO OR LOCAL LOANS WHENEVER 
IT DEEMS NECESSARY.” 
LOANS, THE CEILING SHALL BE ONE BILLION U.S. 
DOLLARS 
SEC. 3. Repealing Clairse. ~ All or any provisions of the Provincial Water Utilities Act 
of 1973 which are contrary or inconsistent with any provisions hereof are hereby deemed 
repealed or modified accordingly. 


SEC. 4. EflectiidQ. - This Act shall take effect after fifteen (15) days following its 
publication in two (2) newspapers of general circulation. 
Approved,