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THIRTEENTH CONGRESS OF THE REPUBLIC 
First Regular Session 
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OF THE PHILIPPINES 
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Introduced by Sbnator Jinggoy Ejercito Estrada 
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E~PLANATORY NOTE 
Local governance is the key to true national development. Through the strengthening 
and empowerment of local government units, Filipinos will have a more direct and more 
meaningful participation in charting the course of their progress and development. 
Thus, this bill endeavors to institute a new local government code that would further 
strengthen the existing political framework for local autonomy. 
The salient features of this proposed measures are as follows: 
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The creation of regional governments for regional administration 
The creation of a Local Government Bank which shall provide efficient and 
responsive general banking services to local governments. 
The proposal to exempt Local Government Bonds from all taxes in order to 
make it attractive for the 'citizens to patronize and at the same time initiate a 
worthy tradition and the institutionalization of bond flotation among local 
The institution of an autonomous local government salary administration 
based on the principle oflaffordability with certain limitations of the frequency 
of salary increases among local governments. 
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authorities. 
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Transfer of administrative and technical supervision of real property tax 
assessment and collection to the proposed Regional Governments. The 
intention of this proposal is to free real property tax administration at the local 
level from undue political pressures. 
Mandatory Formulation of Performance Standards for Local Governments. 
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Measures to enhance fiscal autonomy at the local level thru improved 
revenue generation and allocation and more efficient, transparent and 
responsive fiscal management. 
Premises considered, the approval of this urgent measure is earnestly sought. 
Senator 


THIRTEENTH CONGRESS OF THE REPUBLIC ) 
OF THE PHILIPPINES 
First Regular Session 
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"04 jlJ: 30 ?]I :I 2 
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Introduced by: SENATOR JINGGOY EJERCITO ESTRADA 
AN ACT 
PROVIDING FOR A NEW LOCAL GOVERNMENT CODE OF 
Be it enacted by thb Senate and House of Representatives of the 
Philippines in Congress Assembled. 
ITHE PHILIPPINES 
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TITLE ONE- 
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BAS& PRINCIPLES 
1 Chapter I 
The Code;: Policy and Application 
SEC. I. 
- Local Governmenk Code of the Philippines - This Act shall be known 
and cited as the New Local Government Code of the Philippines. 
SEC. 2. - Declaration of Poiioy- (a) It is hereby declared the policy of the State 
that the territorial and political shbdivisions of the State shall enjoy genuine and 
meaningful local autonomy to enable them to attain their fullest development as self- 
reliant communities and make them' more responsive and accountable local government 
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structure instituted through a system of decentralization whereby local governments 
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shall be given more powers, authority , responsibilities, and resources. 
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(b) It is also the policy 
the State to ensure the accountability of local 
governments through the institutidn of effective mechanisms of recall, initiative and 
referendum. 
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0 It is likewise the policy of the State to require all national agencies andl offices 
to conduct periodic consultations with appropriate local government, non-governmental 
and people's organizations, and other concerned sectors of the community before any 
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project or program is implemented i their respective e jurisdictions. 
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SEC 3. Operative Principles. - The formulation and implementation of policies 
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and measures on local autonomy shjall be guided by the following operative principles: 
(a) There shall be an effectije allocation among the different local governments 
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of their respective powers1 functions, responsibilities, and resources; 
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(b) There shall be established in every local government an accountable, efficient 
and dynamic organizatiodal structure and operating mechanism that will meet 
the priority needs and se4ice requirements of its communities; 
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(c) Subject to civil service! law, rules and regulations, lacal officials and 
employees paid wholly or mainly from local funds shall be appointed or 
removed, according to mdrit and fitness by the appropriate authority; 
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(d) The functions, responsibility, and accountability vested in local governments 
shall be accompanied with provision for reasonable adequate resources to 
discharge their powers abd effectively carry out their functions, hence, they 
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shall have the power to cieate and broaden their own sources of revenue and 
the right to a just share; in national taxes and an equitable share in the 
proceeds of the utilizatior) and development of the natural wealth within their 
respective areas; 
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(e) Provinces with respect to/ component cities and municipalities, and cities and 
municipalities with respect to component barangays, shall ensure that the 
acts of their component units are within the scope of their prescribed powers 
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and functions; 
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(9 Local governments may /group themselves, consolidate or coordinate their 
efforts, services, and res d urces for purposes commonly beneficial to them; 
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(9) The capabilities of local governments, especially the municipalities and 
barangays, shall be edhanced by providing them with opportunities to 
participate actively in the :implementation of national programs and projects; 
(h) There shall be a continuing mechanism to enhance local autonomy not only 
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by legislative enabling acts but also by administrative and organizational 
reforms; 
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(i) Local governments shall $hare with the national government the responsibility 
in the management and maintenance of ecological balance within their 
territorial jurisdiction sudiect to the provisions of this Code and national 
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policies; 
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(j) Effective mechanisms for jensuring the accountability of local governments to 
their respective constituents shall be strengthened in order to upgrade 
continually the quality of local leadership; 
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(k) The realization of local I autonomy shall be facilitated through improved 
coordination of national government policies and programs and extension of 
adequate technical and qaterial assistance to less developed and deserving 
local governments; 
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(I) The participation of the private sector in local governance, particularly in the 
delivery of basic services1 shall be encouraged to ensure the viability of local 
autonomy as an alternative strategy for sustainable development; and 
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(m)The national government ,shall 
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ensure that decentralization contributes to the 
continuing improvement bf the performance of local governments and the 
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quality of community life. 
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SEC. 4. Scope of Applicatibn. - This Code shall apply to all provinces, cities, 
municipalities, barangays and othdr political subdivisions as may be created by law, 
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and, to the extent herein provided, to officials, offices, or agencies of the national 
government . 
SEC. 5: Rules of Interpretadion- In the interpretation of the provisions of 
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this Code, the following rules shall apply 
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(a) Any provision on a power of local government shall be liberally 
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interpreted in its favor, and in case of doubt, any question thereon shall be 
resolved in favor of devolution of powers and of the lover local government. 
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Any fair and reasonable doubt as to the existence of the power shall be 
interpreted in favor of the' local government concerned; 
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(b) In case of doubt, any tad ordinance or revenue measure shall be construed 
strictly against the local government enacting it, and liberally in favor of the 
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taxpayer; 
(c) The general welfare prc 
give more powers tc 
development and upgi 
commu n i ty ; 
(d) In the resolution of COI 
provision or jurispruder 
traditions in the place w 
General Powers ai 
SEC. 6. Authority to Cres 
created, divided, merged, abolish€ 
enacted by Congress in the case 
subdivision, or by ordinance pass 
panlungsod concerned in the case 
SEC 7. Creation and Cot 
government or its conversion from 
indicators of visibility and projectel 
(a) Income- It must be suff 
ail essential governmc 
commensurate with the 
govern men t concerned; 
(b) Population- It shall be de 
territorial jurisdiction of t 
(c) Land Area- It must be c( 
is separated by a ~OCE 
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isions in this Code shall be liberally interpreted to 
local governments in accelerating economic 
jing the quality of life for the people in the 
'oversies arising under this Code where no legal 
3 applies, resort may be had to the customs and 
!re the controversies take place. 
iapter 2 
I Attributes of Local Governments 
Local Governments - A local government may 
or its boundaries substantially altered either by law 
a province, city, municipality, or any other political 
I by the sangguniang panlalawigan or sangguniang 
4 a barangay located within its territorial jurisdiction. 
ersion- As a general rule, the creation of a local 
l e  level to another level shall be based on verifiable 
2apacity to provided services, to wit; 
ent, based on acceptable standards, to provide for 
t facilities and services and special functions 
size of its populations, as expected of the local 
trmined as the total number of inhabitants within the 
! local government concerned; and 
tiguous, unless it comprises two or more islands or 
government independent of the others; properly 


identified by metes and bounds with technical descriptions; and sufficient to 
provide for such basic services and facilities to meet the requirements of its 
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populace. 
Compliance with foregoing indicators shall be attested to by the Department of 
Finance (DOF), the National btatistics Office (NSO), and the Lands Management 
Bureau (LMB) of the Department of Environment and Natural Resources 
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(DENR). 
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SEC. 8. Division or Merger-Division or merger of existing local 
governments shall comply dith same requirements herein prescribed for their 
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creation: Provided however,i 
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population, or land area of the local government(s) shall not fall below its current 
income classification prior to lsuch division. 
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The income classificaiion of local governments shall be updated within six 
months from the effectivity df this Code to reflect the changes in their financial 
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positions resulting from the increased revenues as provided herein. 
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SEC. 9- Abolition of !Local Governments - A local government may be 
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abolished when its income: population, or land area has been irreversibly 
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reduced to less than the minimum standards prescribed for its creation. 
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The law or ordinance abolishing a local government shall specify the 
province, city, municipality, or barangay with which the local government sought 
to be abolished will be incordorated or merged. 
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SEC. I O  Plebiscite 1 Requirement - No creation, division, merger, 
abolition, or substantial alteljation of boundaries of local governments shall take 
effect unless approved by a majority of the votes cast in a plebiscite called for the 
purpose in the political mitior units directly affected. Said plebiscite shall be 
conducted by the Commissio’n on Elections (Comelec) within one hundred twenty 
(120) days from the date if effectivity of the law or ordinance effecting such 
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action unless said law or ordinance fixes another date. 
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SEC. ? A .  Naming of Local Governments and public Places, Streets 
and Structures.(a) The Sangguniang 
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panlalawigan, sangguniang panlunsod, 
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sangguniang bayan which ever is the case may, after conducting public hearing 
and in consultation with the ehilippine Historical Commission (PHC) , change the 
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name of the following within its territorial jurisdiction: 
For Provinces : 
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(I) 
Cities and municipalities, upon the recommendation of the sanggunian 
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concerned ; 
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(2) Provincial roads, avenues, boulevards, thorough-fares, and bridges; 
(3) Public vocational or technical schools and other post-secondary and 
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tertiary schools; 
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(4) Provincial hospital$, health centers, and other health facilities; and 
(5) Any other public plece or building owned by the provincial government. 
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For cities: 
(1) Barangays, upon (he recommendation of the sangguniang barangay 
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concerned; 
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(2) Roads, avenues, doulevards, thorough fares, and bridges; 
(3) Public elementary: secondary and vocational or technical schools, 
community colleges and non-chartered colleges; 
(4) Hospitals, health cbnters and other health facilities; and 
(5) Any other public place or building owned by the city government. 
For Municipalities: 
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(1). Barangays, upon recommendation of the sangguniang barangay 
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concerned; 
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(2) Barangay roads, avenues, boulevards, thorough fares, and bridges; 
(3) Public elementaQ, secondary and vocational or technical schools, 
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post-secondary add other tertiary schools; 
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(4) Hospitals, health centers and other health facilities; and 
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(b) Any other public place or tuilding owned by the local government. 
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None of the fordgoing local governments, institutions, places, or 
buildings shall be named after a living person, nor may a change of 
name be made unless for a justifiable reason and, in any case, not 
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oftener than once: every ten years. The name of a local government 
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or a public place, jstreet or structure with historical, cultural, or ethnic 
significance shall 'not be changed, unless by a unanimous vote of the 
sanggunian concerned and in consultation with the PHC. 
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(2) A change of name of a public school shall be made only upon the 
recommendation of the local school board concerned. 
(3) A change of nahe of public hospitals, health centers, and other 
health facilities s$all be made only upon the recommendation of the 
local health board concerned. 
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(d) Changes of names of locdl government 
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(I) 
The change of name of any local government shall be effective only 
upon ratification ip a plebiscite conducted for the purpose in the 
political unit directly affected. 
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(2) In any change of name, the Office of the President, Regional 
Government and 1 the National Census and Statistics Office, the 
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representative of the legislative district concerned, and the Bureaukl of 
Posts shall be notihed. 
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SEC. 12. 
Corporate Existence - When a new 
local 
government is created, its corporate existence shall 6ommence upon the election and 
qualification of its chief executive !and a majority of the members of its sanggunian, 
unless some other time is fixed therefor by the law or ordinance creating it. 
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SEC. 13. Political and Corporate Nature of Local Governments- Every local 
government created or recognized under this Code is a body politic and corporate 
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endowed with powers to be exercised by it in conformity with law. As such, it shall 
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exercise powers as a political subdi4ision of the national government and as a corporate 
entity representing the inhabitants of its territory. 
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SEC. 14. General Welfare Clause- Every local government shall exercise the 
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powers expressly granted, those necessarily implied therefrom, as well as powers 
necessary, appropriate or incidental for it is efficient and effective governance, and 
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those which are essential to the j promotion of the general welfare. 
Within their 
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respective territorial jurisdictions, dcal governments shall ensure and support, among 
other things, the preservation and /enrichment of culture, promote health and safety, 
enhance the right of the people td a balanced ecology, encourage and support the 
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development of appropriate and $elf-reliant scientific and technological capabilities, 
improved public morals, enhance &onomic prosperity and social justice, promote full 
employment among their residents, maintain peace and order, and preserve the comfort 
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and convenience of their inhabitants. 
SEC. 15. Basic Guidelines in the Delivery of Basic Services and 
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Facilities. (a) Local governments shall endeavor to be self-reliant and shall continue 
exercising the powers and discharging the functions currently vested upon them 
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including those devolved to them. 
(b) Local governments shall be held accountable and responsible in undertaking 
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economic, physical infrastructure, environmental, social, and political 
including technological 
rograms and projects directed towards the full 
development and advancfment of their respective communities. 
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(c) Local governments shall involve the active participation of the civil society, 
and business s includirig other sectors such as NGO’s and people’s 
organizations. 
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SEC. 16. Power of Eminent Domain - A local government may, through its 
chief executive and acting pursuant to an ordinance, exercise the power of eminent 
domain for public use, or purpose, or welfare for the benefit of the poor and the 
landless, upon payment of just compensation, pursuant to the provisions of the 
Constitution and pertinent laws: Provided however, That the power of eminent domain 
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may not be exercised unless a valid: and definite offer has been previously made to the 
owner, and such offer was not accepted: Provided, further, That the local government 
may immediately take possession of the property upon the filing of the expropriation 
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proceedings an upon making a deposit with the proper court of at least fifteen percent 
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5%) of the fair market value of the1 property based on the current tax declaration of the 
property to be expropriated: Prodded finally, That the amount to be paid for the 
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expropriated property shall be deter-mined by the proper court, based on the fair market 
value at the time of the taking of thelproperty. 
SEC. 17. Local Taxation. Local governments shall have the power to create its 
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own sources of revenue and levy takes or imposed charges or fees. 
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SEC. 18. Reclassification df Lands. (a) A city or municipality may through an 
ordinance passed by the sanggunian after conducting public hearings for the purpose, 
authorize the reclassification of agiicultural lands and provide for the manner of their 
utilization or disposition in the following cases: (1) when the land ceases to be 
economically feasible and sound 1 for agricultural purposes as determined by the 
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Department of Agriculture or (2) /where the land shall have substantially greater 
economic value for residential, commercial, or industrial purposes, as determined by the 
sanggunian concerned: Provided, [That such reclassification shall be limited to the 
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foillowing percentage of the total aglicultural land area at the time of the passage of the 
ordinance : 
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(1) Highly urbanized and independent component cities, fifteen percent 
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5%); 
For the component cities and first to third class municipalities, ten 
percent (10%) ; dnd 
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(2) 
(3) For the fourth ito sixth class municipalities, five percent (5%); 
Provided, furthe1 That agricultural lands distributed to agrarian 
reform beneficiaries pursuant to Republic Act Numbered Sixty-six 
hundred fifty-se3en (R.A. No. 6657) , otherwise known as "The 
Comprehensive Agrarian Reform Law", shall not be affected by the 


said reclassificatiion and the conversion of such lands into other 
purposes. 
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(b) The President may, /when public interest so requires and upon 
recommendation by the National Economic and Development Authority, 
authorize a city or municipality to reclassify lands in excess of the limits set in the 
next preceding paragraph. 
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0 The local governments shdll, in conformity with existing laws, continue to 
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prepare their respective /comprehensive land use plans enacted through 
zoning ordinances which !shall be the primary and dominant bases for the 
future use of land resources: Provided, That the requirements for food 
production, human settledents, and industrial expansion shall be taken into 
consideration in the preparation of such plans. 
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(d) Where approval by a natibnal agency is required for classification, such 
(e) approval shall not be unreasonably withheld. Failure to act on a proper and 
complete application for ieclassification within three (3) months from receipt 
of the same shall be deemed as approval thereof. 
(9 Nothing in this Section1 shall be construed as repealing, amending, or 
modifying in any manner {he provisions of R.A. No. 6657. 
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SEC. 19. Closure and Opening of Roads. (a) Local government may pursuant 
to an ordinance, permanently or temporarily close or open any local road, alley, park, or 
square falling within its jurisdiction: Provided however, That in case of permanent 
closure, such ordinance must bel 
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members of the sanggunian, and when necessary, an adequate substitute for the public 
facility that is subject to closure is ptovided. 
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(b) No such way or place or !any part thereof shall be permanently closed without 
making provisions for the maintenance of public safety therein. A property 
thus permanently withdrawn from public use may be used or conveyed for 
any purpose for which oiher real property belonging to the local government 
concerned may be lawfully used or conveyed: Provided, however, That no 
freedom park shall be closed permanently without provision for its transfer or 
relocation to a new site. 
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(c) Any national or local road, alley, park, or square may be temporarily closed 
during an actual emergehcy, or fiesta celebrations, public rallies, agricultural 
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or industrial fairs, or 
telecommunications, and 
specified by the local chi 
however, That no natioi 
temporarily closed for 
sponsored, recognized, c 
(d) Any city, municipality, or 
the use of any local ordir 
other public place where 
shopping areas may k 
foodstuffs, commodities, 
to the general public. 
SEC. 20. Corporate Powers 
have the following powers: 
(I) 
To have continuou 
(2) To sue and be sue 
(3) To have and use a 
(4) To acquire and COI 
(5) To enter into contr 
(6) To exercise such ( 
to the limitations p 
(b) Local governments ma 
corporate seals: Provic 
those without corporate 
shall be registered 1 
Government and the Nz 
change of corporate sei 
(c) 
Unless otherwise provic 
the local government IT 
the sanggunian conceri 
at conspicuous places 
~n undertaking of public works and highways, 
waterworks projects, the duration of which shall be 
!f executive concerned in a written order: Provided, 
al or local road, alley, park, or square shall set 
ithletic, cultural, or civic activities not officially 
* approved by the focal government concerned. 
larangay may, by a duly enacted close and regulate 
ance, temporarily street, road, thoroughfare, or any 
shopping malls, Sunday, flea or night markets, or 
3 established and where goods, merchandise, 
)r articles of commerce may be sold and dispensed 
(a) Every local governmpnt, as a corporation, shall 
succession in its corporate name; 
corporate seal; 
vey real or personal property; 
ct; and 
her powers as are granted to corporations, subject 
3vided in this Code and other laws. 
continue using, modify, or change their existing 
ed, That newly established local governments or 
seals may create their own corporate seals which 
ith the Department of the Interior and Local 
ional Historical Institute; Provided, further, That any 
I shall also be registered as provided herein. 
2d in this Code, the local chief executive in behalf of 
ay enter into contract without prior authorization by 
ed. A legible copy of such contract shall be posted 
in the provincial capitol or the city, municipal or 
barangay halls. 


(d) 
Local governments shall enjoy full autonomy in the exercise of their 
proprietary functions an4 in the management of their economic enterprises, 
subject to the limitations/ provided in this Code and other applicable laws. 
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SEC. 21. Authority to 'Negotiate and Secure Grants. Local chief 
executvemaymay upon may, upon Luthority of the sanggunian, negotiate and secure 
financial grants or donations in Mid, from all legal sources including countries with 
which the Philippines has diplomabc relations in support of the basic services and 
facilities, however, that projects fin!anced by such grants or assistance with national 
security implications shall be given ilearance by the national agency concerned. 
exempt from liability for death or injdry to persons or damage to property. 
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SEC. 22. Liability for Damabes.- Local governments and their officials are not 
1 TITLE TWO- 
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INTERGO ERNMENTAL RELATIONS 
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National Goverhment and Local Governments 
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SEC. 23. National Supervision Over Local Governments- Consistent with the 
basis policy on local autonomy, the President of the Philippines shall, through either the 
appropriate executive department or Regional Government, exercise general 
supervision over local governmentsjto ensure that their acts are within the scope of their 
prescribed powers and functions. 
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Chapter2 
Relations with the Philippine National Police 
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SEC. 24. Powers of Local bhief Executives Over the Units of the Philippine 
National Police.- The extent of operational supervision and control of local chief 
executives over the police force, fire protection unit, and jail management personnel 
assigned in their respective jurisdic.t'ions shall be governed by the provisions of Republic 
Act Numbered Sixty-nine seventy-kve (R.A. No. 6975), as amended by Republic Act 
8551. In addition to the powers he'ceinafter provided, the city or municipal mayor shall 
have the power to choose the chied of police, recommend the transfer, reassignment or 
detail of members of the PhilippinejNational Police. He shall also exercise control and 
supervision over anti-gambling actiiities. 


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In case the city or municipality police force is not adequate to meet or cope with 
the danger posed to public order 01 safety, the city or municipal mayor shall augment 
the same by constituting a special force unit in his jurisdiction, to be composed of 
persons who possess qualification( similar to those of regular members of the police 
force, to be appointed by him and whose salaries and benefits shall be paid out of his 
discretionary fund or funds availabld in the local treasury. 
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As a deputy of the national dolice commission, the city or municipal mayor shall 
have administrative supervision anti control over the special police force unit, which 
shall continue to be maintained uhtil the cessation of the danger for which it was 
onstituted or upon resumption of peece and order in the community 
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Chapter3 
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Inter-Local Government Relations 
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SEC. 25 Provincial Relatidns with Component Cities and Municipalities- 
The province, through the goverqor, shall ensure that every component city and 
municipality within its territorial jurisqiction acts within the scope of its prescribed powers 
and functions. Highly urbanized dities and independent component cities shall be 
independent of the province. 
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SEC. 26. Submission of Mynicipal Questions to the Provincial Legal Officer 
or Prosecutor. In the absence of la municipal legal oficer, the municipal government 
may secure the opinion of the provincial legal ofFicer, and in the absence of the latter, 
that of the provincial prosecutor on any legal question affecting the municipality. 
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SEC. 27. City and Municipdl Supervision Over their Respective Barangays.- 
The city or municipality, through the city or municipal mayor concerned, shall exercise 
general supervision over component barangays to ensure that said barangays act within 
the scope of their prescribed functidns and powers. 
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SEC. 28. Corporate Undertakings Among Local Governments.- Local 
governments may, through appropriate ordinances, exercise their joint powers to group 
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themselves, consolidate, or coor'dinate their efforts, services and resources for 
purposes commonly beneficial to them. In support of such undertakings, the local 
governments involved may, upon approval by the sanggunian concerned after a public 
hearing conducted for the purpose,l contribute funds, real estate, equipment, and other 
kinds of property and appoint or adsign personnel under such terms and conditions as 
may be agreed upon by the particip$ting local units through memoranda of agreement. 
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FITTLE THREE- 
Regional Government, which shall be a body politic and corporate, comprising of all 
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SEC. 32. Presiding Officer1 The chairman shall preside over the sessions or 
meetings of the council and exercise supervision over the work of the Regional 
Administrator and those of other public officials of the Regional Government. 
SEC. 33. Terms of Office. !A member of the council shall have a term of office 
of three years and shall receive a s/dary in an amount no higher than the monthly salary 
of Members of the House of Redresentatives. He shall also be entitled to travel 
allowance in attending sessions of b e  regional legislative council. 
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directly affected. 


C. 34. Internal Rules 
formulation and adoption of the in1 
the regional legislative council. 
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SEC. 35. Functions and 
through appropriate. bodies exerci: 
Organize its administra 
the Regional Governmt 
Provide policy directio 
administration; 
Perform management r 
Establish standard 
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organization; 
Allocate the internal re\ 
Exercise taxing and re\ 
Promote regional inves 
Provide region-wide pu 
Review the valuation oi 
assessed by local gove 
Ensure that the acts 
independent compone 
powers including adr 
constitutionality ; and 
Such powers and funct 
and interregional coopc 
Governments to enlist 
the economic and sock 
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egulations. The chairman shall initiate the 
ial rules and regulations governing the business of 
Chapter 2 
,$ions and Powers 
bwers- The Regional Government shall have and 
the following functions and powers: 
3 offices or services in support of the operations of 
and program strategies in regional development 
ionsibilities of region-wide public infrastructures; 
performance as guide in local government 
iue allotments (IRA) to local governments; 
ue raising powers 
2nts; 
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services; 
nds or real properties for tax purpose as these are 
nents; 
If component provinces, highly urbanized and 
cities are within their prescribed functions and 
istrative questions involving their legality and 
IS in ;the furtherance of local autonomy, inter-local 
tion, which shall include the power of the Regional 
? assistance of the Regional Councils in planning 
evelopment of the regions. 


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or receipts of the business conceri 
SEC. 36. Share of Nationa 
shall be entitled to a five percent ( 
the collections of the third fiscal 
however, That the share of each 
bases of the following formula: 
(I) 
Population- Fifty percent 
(2) Land Area- twenty-five pc 
(3) Equal Sharing- Twenty-fii 
exempted, at a uniform basic tax 
property as follows: 
Residential- ten percent (1 0%) 
Provided, finally, That the 
released automatically and without 
Regional Government on a quartei 
quarter, and shall not be subject tc 
National Government . 
rate applied to the Fair Market Value of the real 
of one percent (1 %) to one percent (1 %) 
Chapter 3 
rces of Revenues 
Government Taxes.- The Regional Government 
%) share of National Government taxes based on 
ear preceding the current fiscal year; Provided, 
!egional Government shall be determined on the 
50) 
cent (25%) 
3 percent (25%) 
Forementioned five p rcent (5%) share shall be 
my unnecessary pre-release action, directly to the 
y basis within five (5) days after the end of each 
any lien or holdback that may be imposed by the 
The Regional Governments are hereby empowered 
not exceeding one percent (?%) of the gross sales 
3d in the preceding Calendar Year, subject to the 
-, Chapter I, 
Title Nine of This Code. 
I 
Agricultural- ten percent( I 
OO/”o)of one percent( 1 %) to one percent (I 
%) 
’ Others- ten percent (1 0%) o( one percent (1 %) to one percent (1 %) 
i 
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SEC. 39 - Service Fees an8 Charges- Regional Governments may impose and 
(a) Rendition of services in \elation to its authorized functions; 
I 
collect reasonable fees and charge? for the following: 
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held in trust for it by the Bureau 
Members of its Legislative Council. 
of Treasury until the assumption to office of the 


(3) A population of not less than five hundred fifty thousand (350.000) 
Provided, That, 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 less than the minimum 
requirements prescribed herein. 
1 
I 
inhabitants as certified by the National Statistics Office. 
(b) The territory nee not be contiguous if it comprises of two (2)or more 
islands or is sep rated by a city or cities, which do not contribute to 
the income of the 'province. 
4 
? 
(c) The average ann L al income shall include the income accruing to the 
I 
general fund. Exclusive of special funds, trust funds, transfers, and 
non-recurring inc&m. 


assessor, a provincial accountant, a provincial engineer, a provincial a provincial budget 
except those officials and employees of the sanggunian. 
of efficiency, economy, and simplicity. 
until after the expiration 
such increase. 
of the full term of all the elective officials approving 


Sang 
SEC. 49. Composition. - 
body of the province, shall be cot 
offacer, the regular sanggunian me 
liga ng mga barangay, the pre. 
saiigguniang kabataan, the pre: 
members of municipalities and co 
membe rs. 
(b) In addition thereto, there sh 
the women; and as shall t: 
ninety (90) days prior to tl 
agricultural or industrial wor 
urban poor, indigenous cult1 
(c) The regular members of 
representatives shall be elel 
Cl 
Role i 
SEC. 50. Creation and FI 
urbanized and developed barangs 
coordination and delivery of basic 
arrd for effective city governance. 
SEC.51. Manner of Crea 
abolished, or its boundary substar 
approval by a majority of the vote2 
in the local government(s) direct11 
such Act, the plebiscite shall be i 
date of its effectivity. 
\ - *  
Chapter 3 
iniang Panlalawigan 
a) The sangguniang panlalawig an, the legislative 
)osed of the provincial vice-governor as presiding 
bers, the president of the provincial chapter of the 
lent of the panlalawigang pederasyon ng mga 
ent of the provincial federation of sanggunian 
sonent cities, and the sectoral representatives, as 
be three (3) sectoral representatives: one (1) from 
determined by the sanggunian concerned within 
1 holding of the local elections, one (I) 
from the 
rs; and one (1) from the other sectors, including the 
31 communities, or disabled persons. 
le sangguniang panlalawigan and the sectoral 
:d in the manner as may be provided for by law. 
TITLE FIVE. 
' GOVERNMENTS 
Chapter I 
d Creation of the City 
ction of the City. - The city, consisting of more 
;, serves as a general-purpose government for the 
:ity-wide services for the benefits of the inhabitants 
m. - A city may be created, divided, merged, 
ally altered, only by an Act of Congress, subject to 
ast in a plebiscite to be conducted by the Comelec 
affected. Except as may otherwise be provided in 
Id within one hundred twenty (120) days from the 


(I) 
A contiguous territory 
as certified by the Lands 
(2) A population of not 
inhabitants, as certified 
Provided, That, the creation 
and income of the original unit or 
a municipality. 
of at least one hundred (100) square kilometers, 
Management Bureau; or, 
less than one hundred fifty thousand (150,000) 
by the National Statistics Office; 
thereof shall not reduce the land area, population, 
units at the time of said creation to less than the 
urbanized: Provided, however, that the criteria established in this Code shall not affect 
SEC. 54. Highly Urbanized Cities. - (a) Cities with a minimum population of two 


i 
elective provincial officials. 
valters therein. 
mayor, a vice-mayor; sanggunidng panlungsod members, a secretary to the 
sangguniang panlungsod, a city tdpasurer, a city assessor, a city accountant, a city 
I 
Chapter 2 
budget officer, a city planning and development coordinator, a city engineer, a city 
health officer, a city civil registra' a city administrator, a city legal officer, a city 
veterinarian, a city social welfare a r; d development officer, and a city general services 
I 
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officer. 
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(b) In addition thereto, the cit mayor may appoint other officials, which a city 
government may find necessary in the performance its mandates except those 
officials and employees of th sanggunian. 
(I) 
7 
e 
. 
(c) The sangguniang panlungsod may: 
Create such other offijces as may be necessary to carry out the purposes 
of the city governmen); 
I or 
(3) Consolidate the fubctions of two or more offices in the interest of 
(4) efficiency, 
i 
economy and simplicity. 
I 
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(d) Unless otherwise provided herein, heads of departments and offices shall be 
appointed by the city mayoti subject to civil service law, rules and regulations. 
The sangguniang panlungs4d shall act on the appointment within fifteen (15) 


increase in compensation 
I 
of the mayor, vice-mayor and sangguniang 
The Sa gguniang Panlungsod 
4 
SEC. 57. Composition. - (a) I The sangguniang panlungsod, the legislative body 
of the city, shall be composed of t e city vice-mayor as presiding officer, the regular 
samggunian members, the presiden 1 
of the city chapter of the liga ng mga barangay, the 
president of the panlungsod ng pederasyon ng mga sangguniang kabataan, and the 
sectoral representatives, as members. 
(b) In addition thereto, there sha/l be three (3) sectoral representatives: one (1) from 
the women; and, as shall be determined by the sanggunian concerned within 
I 
ninety (90) days prior to th holding of the local elections, one (1) from the 
agricultural or industrial workers; and one (1) from the other sectors, including the 
urban poor, indigenous cultu al communities, or disabled persons. 
(c) The regular members of the sangguniang panlungsod and the sectoral 
representatives shall be elected in the manner as may be provided for by law. 
I 
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I TITLESIXm 
THE MUNICIPALITY 
Chapter I 
Role and C,reation of the Municipality 
I 
SEC. 68. Creation and Rol of a Municipality. - The municipality, consisting of 
a group of barangays, serves primarily as a general-purpose government for the 
I 
coordination and delivery of basic services municipal-wide for the benefit of its 
inhabitants and for the attainment 21 effective governance. 
SEC. 59. Manner of 
. - A municipality may be created, divided, merged, 
altered by an Act of Congress and subject to the 
abolished, or its boundary 


sand Act, the plebiscite shall be held 
of its effectivity. 
within one hundred twenty (120) days from the date 
requirements prescribed herein. 
Chapter 2 


I(b) In addition thereto, the ma: 
government may find nece 
except those officials and er 
(c) The sangguniang bayan ma 
(1) 
Create such other of 
of the municipal gove 
(2) 
Consolidate the fun 
efficiency, economy E 
(d) Unless otherwise provided 
law, rules and regulations, 
sangguniang bayan, on a rr 
fifteen (15) days from the 
expiration of period, concuri 
(e) Elective and appointive m 
allowances and other emoi 
subject to the budgetary I 
increase in compensation 
members shall take effect 
elective local officials appro 
I 
T ha 
SEC. 62. Composition. - (, 
municipality, shall be composed 01 
regular sanggunian members, the 
barangay, the president of the par 
arid the sectoral representatives, i 
(b) In addition thereto, there sh 
the women; and, as shall 
ninety (90) days prior to 
agricultural or industrial worl 
urban poor, indigenous cult1 
(c) The regular members of the 
shall be elected in the mann 
r may appoint other officials, which the municipal 
ary in the performance of its task or mandates, 
loyees of the sanggunian. 
3s as may be necessary to carry out the purposes 
ment; or 
ons of two or more offices in the interest of 
1 simplicity. 
:rein, the municipal mayor, subject to civil service 
all appoint heads of departments and offices. The 
wity vote, shall concur with the appointment within 
ate of its submission; if no action is taken after 
ice therein shall be deemed made. 
icipal officials shall receive such compensation, 
ients as may be determined by law or ordinance, 
itations on personal services. Provided, That no 
the mayor, vice-mayor, and sangguniang bayan 
itil after the expiration of the full term of all the 
ig such increase. 
Chapter 3 
angguniang Bayan 
The sangguniang bayan, the legislative body of the 
e municipal vice-mayor as the presiding officer, the 
esident of the municipal chapter of the liga ng mga 
ayang pederasyon ng mga sangguniang kabataan, 
members. 
be three (3) sectoral representatives: one (I) 
from 
determined by the sanggunian concerned within 
e holding of local elections, one (I) 
from the 
rs; and one (1) from the other sectors, including the 
iI communities, or disabled persons. 
ingguniang bayan and the sectoral representatives 
as may be provided for by law. 


. 
I 
TITLE SEVEN. 
(b) The territorial jurisdiction of 
BARA~GAY GOVERNMENTS 
the new barangay shall be properly identified by 
I 
Barangay 
Chapter 2 
Officials and Offices 


SEC. 67. Persons in Authc 
punong barangay, sangguniang 
taglapamayapa in each barangay 
jurisdictions, while other barangay 
law or ordinance and charged wi 
security of life and property, 01 
environment, and any barangay ml 
shall be deemed agents of persons 
Thi 
SEC. 68. Chief Executive: 
the chief executive of the baranga) 
such powers as herein provided. 
(b) For efficient, effective and c 
general welfare of the baran 
Code, the punong barangay 
Enforce all laws and ( 
Negotiate, enter into, 
upon authorization of 
Maintain public order 
city or municipal may 
of their duties and fur 
Call and preside ove 
barangay assembly, i 
Upon approval by i 
barangay, appoint ( 
secretary, and other i 
Organize and lead 
necessary for the m 
emergency or calami1 
Prepare the annual e 
Approve vouchers re1 
ty. - For purposes of the Revised Penal Code, the 
xangay members, and members of the lupong 
)hall be deemed as persons in authority in their 
ificials and members who may be designated by 
the maintenance of public order, protection and 
the maintenance of a desirable and balanced 
nber who comes to the aid of persons in authority, 
n authority. 
Chapter 3 
Punong Barangay 
uties and Powers. - (a) The punong barangay, as 
lovernment, shall perform such duties and exercise 
onomical governance, the purpose of which is the 
ay and its inhabitants pursuant to Section 14 of this 
hall: 
dinances which are applicable within the barangay; 
nd sign contracts for and in behalf of the barangay, 
le sangguniang barangay; 
I the barangay and, in pursuance thereof, assist the 
r and the sanggunian members in the performance 
tions; 
the sessions of the sangguniang barangay and the 
id vote only to break a tie; 
majority of all the members of the sangguniang 
replace the barangay treasurer, the barangay 
pointive barangay officials; 
I emergency group whenever the same may be 
ntenance of peace and order or on occasions of 
within the barangay; 
?cutive and supplemental budgets of the barangay; 
ling to the disbursement of barangay funds; 


the environment; 
be entitled to possess and 
I 
carry the necessary firearm within his territorial 
kabataan chairman, as members. 
monies or properties donated by private agencies and individuals for 


permits from any na 
proceeds from such 
general fund of the b 
Appropriate in an 
operation of the bara 
Provide for the con! 
facilities and other pi 
the barangay or SUC 
charge reasonable I 
technical and advi: 
sources. 
Submit to the sanc 
suggestions or recor 
the barangay or for tl 
Assist in the establi 
enterprises that will i 
residents; 
Provide compensatic 
travel expenses for : 
officials, Provided, 1 
honoraria of the sar 
afier the expiration 1 
barangay approving ! 
Authorize the punon 
barangay, 
Authorize the barang 
not exceeding one tb 
ordinary and essentii 
Provide for the admii 
pangkat ng tagapagk 
Provide for the orgar 
community service UI 
Organize regular leci 
as sanitation, nutritio 
to encourage citizen 
(13) 
Adopt measures to p 
mendicants in the ba 
mal or local office or agency. Provided, that the 
tivities shall be tax-exempt and shall accrue to the 
angay: 
inual or supplemental budgets Monies for the 
lay; 
uction, maintenance and regulations of barangay 
lic works projects chargeable to the general fund of 
other funds actually available for the purpose and 
!s for the use thereof; solicit or accept financial, 
y assistance from local, national and external 
miang panlungsod or sangguniang bayan such 
iendations as it may see fit for the improvement of 
welfare of the inhabitants thereof; 
Iment, organization, and promotion of cooperative 
prove the economic condition and well-being of the 
, reasonable allowances or per diems as well as 
ngguniang barangay members and other barangay 
wever, That no increase in the compensation or 
guniang barangay members shall take effect until 
the full term of all members of the sangguniang 
ch increase; 
barangay to enter into contracts in behalf of the 
y treasurer to make direct purchases in an amount 
Asand pesos (Php 1,000.00) at anyone time for the 
administrative needs of the barangay; 
itrative needs of the lupong tagapamayapa and the 
;undo; 
ation of community brigades, barangay tanod, or 
s as may be necessary; 
*es, programs, or fora on community problems such 
literacy, and drug abuse, and convene assemblies 
irticipation in government; 
vent and control the proliferation of squatters and 
way; 


(14) 
Provide for the prc 
barangay by promot 
total development of 
age; adopt measure 
abuse, child abuse, i 
a barangay high schc 
(15) 
Provide for the estz 
barangay whenever 
Education, Culture ai 
(16) 
Exercise such other 
prescribed by law c 
ordinances should nc 
SEC. 71. Other Duties o 
their duties as members of th 
members may: 
(a) Assist the punong baranga) 
(b) Act as peace officers in the 
(c) Perform such other duties a 
SEC. 72. Benefits of Bar 
barangay tanods and members o 
all,owances, and such other emol 
municipal or city ordinance in acc 
caise shall it be less than one tho1 
barangay and six hundred pesos ( 
members, barangay treasurer, anc 
(b) The punong barangay, th 
treasurer, and the baranga) 
(I) 
Be entitled to Chi 
(Phpl,OOO.OO) each, 
fund of the barangay 
government for the p 
(2) 
Be entitled, during tl 
include, but shall nc 
double indemnity, i 
accordance with Re 
(R.A. No. 6942), en 
.I 
3r development and welfare of children in the 
J and supporting activities for the protection and 
Tildren, particularly those below seven (7) years of 
towards the prevention and eradication of drug, 
d juvenile delinquency; initiate the establishment of 
I, whenever feasible, in accordance with law; 
. 
ishment of a non-formal education center in the 
sasible, in coordination with the Department of 
sports; 
Iwers and perform such other functions as may be 
ordinance. Provided, that penalty for violation of 
exceed one thousand pesos (Phpl,OOO.OO) 
Sangguniang Barangay Members. In addition to 
sangguniang barangay, sangguniang barangay 
I the discharge of his duties; 
aintenance of public order and safety; and 
the punong barangay may delegate. 
igay Officials. - (a) Barangay officials, including 
he lupong tagapamayapa, shall receive honoraria, 
nents as may be authorized by law or barangay, 
rdance with the provisions of this Code, but in no 
md pesos (Php1,000.00) per month for the punong 
ip600.00) per month for the sangguniang barangay 
larangay secretary: 
sangguniang barangay members, the barangay 
ecretary shall also: 
tmas bonus of at least one thousand pesos 
re funds for which shall be taken from the general 
- from such other funds appropriated by the national 
pose; 
ir incumbency, to insurance coverage which shall 
be limited to temporary and permanent disability, 
:ident insurance, death and burial benefits, in 
iblic Act Numbered Sixty-nine hundred forty-two 
led "An Act Increasing the Insurance Benefits of 


i 
(c) Elective barangay officials 
Local Government Offibials and Providing Funds Therefor”; 
Be entitled to free midical care including subsistence, medicines, and 
medical attendance i any government hospital or institution: Provided, 
That such hospital care shall include surgery or surgical expenses, 
medicines, x-rays, lab I ratory fees, .and other hospital expenses; 
(3) 
I 
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In case of extreme urgency where there is no available government hospital or 
institution, the barangay official concerned may submit himself for immediate 
medical attendance to the n arest private clinic, hospital or institution and the 
expenses not exceeding five housand pesos (Php5,000.00) that may be incurred 
therein shall be chargeable against the funds of the barangay concerned; 
(4) 
Be exempted durin$ their incumbency from paying tuition and 
matriculation fees for their legitimate dependent children attending state 
colleges or universities. He may likewise avail of such educational benefits 
in a state college or u iversity located within the province or city to which 
the barangay belongs; and 
Be entitled to appropriate civil service eligibility on the basis or the number 
or years of service to the barangay, pursuant to the rules and regulations 
issued by the Civil Seyice Commission. 
’ 
I 
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(5) 
I 
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shall have preference in appointments to any 
which shall number not more than twenty (20) in each barangay, shall be granted 
punished with suspension or 
responsible therefor. 
dismissal from office of the official or employee 


._ , 
i 
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Service Commission. 
1 
Chapter 
Assist the municipal 
marriages; 
Appointive Barangay Officials 
I 
cvil registrar in the registration of births, deaths, and 
(c) No person shall be appoirked barangay secretary if he is a sangguniang 
barangay member, a government employee, or a relative of the punong 
barangay within the fourth ciyil degree of consanguinity or affinity. 
I 
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(d) The barangay secretary shall. 
1' 
Keep custody of all/ records of the sangguniang barangay and the 


C. 75. Barangay Tress 
Powers. - (a) The barangay treasul 
the concurrence of the majority 
appointment of the barangay treas 
Service Commission. 
(b) The barangay treasurer sh; 
resident of the barangay 
accounting. 
(c) No person shall be appoii 
barangay member, a gove 
barangay within the fourth ci\ 
(d) The barangay treasurer sha 
amount to be determined b) 
thousand pesos (Php10,OO 
barangay. 
(e) The barangay treasurer shal' 
Keep custody of barar 
Collect and issue offi 
materials, and all othr 
deposit the same in th 
Disburse funds in accl 
Submit to the punon 
estimates of income 
calendar years, respe 
Render a written acc 
under his custody at t 
report shall be made 
and other governmeni 
Certify as to the avail: 
Plan and attend to the 
Exercise and perform 
by law or ordinance. 
SEC. 76. Other Appointiv 
other barangay officials appointed 
provisions of barangay ordinances. 
r: Appointment;, Qualifications, Duties and 
?r shall be appointed by the punong barangay with 
If all the sangguniang barangay members. The 
irer shall not be subject to attestation by the Civil 
I1 be of legal ,age, a registered voter, an actual 
oncerned, and posses a working knowledge of 
ted barangay treasurer if he is a sangguniang 
nment employee, or a relative of the punong 
iI degree of consanguinity or affinity. 
be bonded in accordance with existing laws in an 
the sangguniang barangay but not exceeding ten 
LOO), premiums for which shall be paid by the 
Jay funds and properties; 
:ial receipts for taxes, fees, contributions, monies, 
r resources accruing to the barangay treasury and 
: account of the barangay; 
rdance with the approved budget; 
I barangay a statement covering the actual and 
3nd expenditures for the preceding and ensuing 
tivel y ; 
writing report of all barangay funds and property 
te end of each calendar year, and ensure that such 
vailable to the members of the barangay assembly 
agencies concerned; 
ility of funds whenever necessary; 
rural postal circuit within his jurisdiction; and 
uch other powers and duties as may be prescribed 
! Officials. - The qualifications, and duties, of all 
)y the punong barangay shall be governed by the 


BI 
SEC. 77. Composition; Ma 
composed of all persons who are 
months, fifteen (I 5) years of age or 
in the list of barangay assembly me 
(b) The.barangay assembly sha 
semestral report of the sa 
finances as well as problem 
upon call of the punong t 
sangguniang barangay, or 1 
the assembly members. 
(d) No meeting of the barangay 
given one (I) 
week prior to t 
or security, in which case nc 
punong barangay, or In his 
as punong barangay, or ar 
shall act as presiding office1 
secretary, or in his absence 
act as secretary, shall dit 
assembly. 
SEC. 78. Powers of the Ba 
(a) Initiate legislative processes 
adoption of measures for thl 
city or municipality concerns 
(b) Hear and pass upon the 
concerning its activities and 
Katar 
SEC. 79. Lupong Tagap 
barangay a lupong tagapamayapa 
the punong barangay as chairman 
be constituted every three (3) years 
Chapter 6 
rangay Assembly 
stings. - (a) There shall be a barangay assembly 
ictual residents of the barangay for at least six (6) 
wer, citizens of the Philippines, and duly registered 
nbers. 
I meet at least twice a year to hear and discuss the 
igguniang barangay concerning its activities and 
i affecting the barangay. Its meetings shall be held 
arangay or of at least four (4) members of the 
pon written petition of at least five percent (5%) of 
assembly shall take place unless a written notice is 
le meeting except on matters involving public safety 
ice within a reasonable time shall be sufficient. The 
bsence, the sangguniang barangay member acting 
y assembly member selected during the meeting, 
in all the meetings of the assembly. The barangay 
any member designated by the presiding officer to 
zharge the duties of secretary of the barangay 
angay Assembly. - The barangay assembly shall: 
by recommending to the sangguniang barangay the 
welfare of the inhabitants of the barangay and the 
1; and 
semestral report of the sangguniang barangay 
i nances. 
Chapter 7 
rngang Pam barangay 
imayapa. - (a) There is hereby created in each 
hereinafter referred to as the lupon, composed of 
nd ten (IO) to twenty (20) members. The lupon shall 
in the manner provided here in. 


(b) Any person actually residin! 
disqualified by law, and PO! 
sense of fairness, and repi 
lupon; 
(b) A notice to constitute the 
members who have expret 
the punong barangay withir 
office. Such notice shall 
barangay continuously for i 
(d) The punong barangay, taki 
appointment or any recornn 
within the period of postir 
members those whom he c 
be in writing, signed by thr 
secretary; 
(e) The list of appointed memk 
the barangay for the entire 1 
(9 In barangays where majo 
cultural communities, local 
datus or elders shall be rec 
SEC. Oath and Term of C 
take an oath of 'office before the pi 
is constituted on the third year fo 
resignation, transfer of residence 
puinong barangay with the concurr 
SEC. 81. Vacancies. - Sh 
punong barangay shall immediate1 
for the unexpired portion of the ter 
SEC. 82. Functions of tils 
(a) Exercise administrative sup 
(b) Meet regularly once a mont 
members and the public 
disputes, and to enable va 
another their observations 
disputes; and 
sr working in the barangay, not otherwise expressly 
essing integrity, impartiality, independence of mind, 
ition for probity, may be appointed a member of the 
ipon, which shall include the names of proposed 
2d their willingness to serve, shall be prepared by 
he first fifteen (15) days from the start of his term of 
? posted in three (3) conspicuous places in the 
Ieriod of not less than three (3) weeks; 
I into consideration any opposition to the proposed 
ndations for appointments as may have been made 
, shall within ten (IO) days thereafter, appoint as 
,ermines to be suitable therefor. Appointments shall 
3unong barangay, and attested to by the barangay 
's shall be posted in three (3) conspicuous places in 
ration of their term of office; and 
f of the inhabitants are members of indigenous 
stems of settling disputes through their councils of 
inized. 
'ice. - Upon appointment, each lupon member shall 
ong barangay. He shall hold office until a new lupon 
wing his appointment unless sooner terminated by 
place of work, or withdrawal of appointment by the 
Ice of the majority of all the members of the lupon. 
ild a vacancy occur in the lupon for any cause, the 
appoint a quaJified person who shall hold office only 
.upon. - The lupon shall: 
vision over the conciliation panels provided herein; 
to provide a forum for exchange of ideas among its 
I matters relevant to the amicable settlement of 
IUS conciliation panel members to share with one 
nd experiences in effecting speedy resolution of 


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(c) Exercise such other pow~ 
prescribed by law or ordinal 
SEC. 83. Secretary of tile 
serve as the secretary of the lupon 
before the punong barangay and 
municipal courts. He shall also rei 
to him by the various conciliation $ 
SEC. 84. Pangkat ng Ta 
each dispute brought before the Ii 
ng tagapagkasundo, hereinafter 
members who shall be chosen by 
the lupon. 
Should the parties fail to a 
determined by lots drawn by the lu 
The three (3) members 
themselves the chairman 
minutes of the pangkat prc 
chairman to the lupon sec 
shall issue and cause to be 
The lupon secretary shall i 
custody that is not by law otherwis 
SEC. 85. Vacancies in th 
chosen by the parties to the dispi 
parties fail to agree on a common 
by the lupon chairman. 
SEC. 86. Character of Off 
members, while in the performani 
shall be deemed as persons in aul 
(b) The lupon or pangkat mem 
entitled to the benefits or 
ordinance." The Departmer 
for a system of granting e( 
members who adequately d 
i and perform such other functions as may be 
e. 
upon. - The barangay secretary shall concurrently 
-le shall record the results of mediation proceedings 
;hall submit a report thereon to the proper city or 
ive and keep the records of proceedings submitted 
iels. 
ipagkasundo. - (a) There shall be constituted for 
on a conciliation panel to be known as the pangkat 
ferred to as the pangkat, consisting of three (3) 
le parties to the dispute from the list of members of 
ee on the pangkat membership, the same shall be 
in chairman. 
instituting the pangkat shall elect from among 
id the secretary. The secretary shall prepare the 
?edings and submit a copy duly attested to by the 
tary and to the proper city or municipal court. He 
3rved notices to the parties concerned. 
ue certified true copies of any public record in his 
declared confidential. 
Panakat. - Any vacancy in the pangkat shall be 
! from among the other lupon members. Should the 
ioice, the vacancy shall be filled by lot to be drawn 
B and Serwice of Lupon Members. -(a) The lupon 
of their oficial duties or on the occasion thereof, 
xity, as defined in the Revised Penal Code. 
?rs. shall serve without compensation, "but shall be 
rivileges granted to barangay officials by law or 
of the Interior and Local Government shall provide 
nomic or other incentives to the lupon or pangkat 
nonstrate the ability to judiciously and expeditiously 


I e 
i 
I 
I 
resolve cases referred to th m. While in the performance of their duties, the 
lupon or pangkat members, (whether in public or private employment, shall be 
deemed to be on official time, and shall not suffer from any diminution in 
compensation or allowance fcom said employment by reason thereof. 
SEC. 87. Legal 
Questions of Law. - The 
legal officer shall render legal 
punong barangay or any lupon or 
exercise of his functions in the 
provincial, city legal 
advice on matters involving 
pangkat member whenever 
adrninistration of the katarungang 
SEC. 88. Subject Matter fo Amicable Settlement; Exception Thereto, - The 
lupon of each barangay shall ha e authority to bring together the parties actually 
residing in the same city or municip 1 
lity for amicable settlement of all disputes except: 
(a) Where one party is the goveqnment, or any subdivision or instrumentality thereof; 
(b) Where one party is a public fficer or employee, and the dispute relates to the 
(c) Offenses punishable by imprlsonment exceeding one ( I )  year or a fine exceeding 
(d) Offenses where there is no private offended party; 
(e) Where the dispute involves real properties located in different cities or 
i 
i 
3 
performance of his official functions; 
five thousand pesos (Php5,OOO.OO); 
1 
I 
i 
parties thereto agree to su 
appropriate lupon; and 
(9) Such other classes of dis 
interest of justice or upon thl 
The court in which non-crim 
under this Code are filed may, at a 
lupon concerned for amicable settll 
SEC. 89. Venue. - (a) Disr 
barangay shall be brought for amic 
(b) Those involving actual resid 
municipality shall be braugh 
respondents actually reside! 
lmit their differences to amicable settlement by an 
lutes, which the President may determine in the 
recommendation of the secretary of Justice. 
ial cases not falling within the authority of the lupon 
y time before trial, motu proprio refer the case to the 
ment. 
Jtes between persons actually residing in the same 
ible settlement before the lupon of said barangay. 
!nts of different barangays within the same city or 
in the barangay where the respondent or any of the 
, at the election of the complainant. 


(c) All disputes involving real p 
barangay where the real pn 
(d) Those arising at the workpl 
the institution where such I 
barangay where such work! 
Objections of venue shall 
punong barangay; otherwise, the 
which may confront the punong 
reterred to may be submitted tc 
representative, whose ruling there 
SEC. 90. Procedure foi 
proceeding - Upon payment of 1 
caluse of action against another inc 
lupon may complain, orally or in w 
(b) Mediation by lupon chairmE 
shall within the next workir 
complainant(s) for them anc 
of their conflicting interests 
days from the first meeting 
for the constitution of the 
Chapter. 
(c) Suspension of prescriptivf 
mediation, conciliation, or 
cause of action under e>c 
complaint with the punong I 
receipt by the complainant 
the certification to file actio 
however, That such interrul 
the complaint with the punc 
(d) Issuance of summons; hez 
convene not later than thrE 
set by the lupon chairman 
issues, and explore all poss 
pangkat may issue sumrr 
witnesses before it. In the 
the pangkat by reason of re 
discovered after the constit 
perty or any interest therein shall be brought in the 
erty or the larger portion thereof is situated. 
:e where the contending parties are employed or at 
rties are enrolled for study shall be brought in the 
ice or institution is located. 
3 raised in the mediation proceedings before the 
ame shall be deemed waived. Any legal question 
larangay in resolving objections to venue herein 
the secretary of Justice, or his duly designated 
I shall be binding. 
Amicable Settlement - (a} Who may initiate 
2 appropriate filing fee, any individual who has a 
ridual involving any matter within the authority of the 
ing, to the lupon chairman of the barangay. 
- Upon receipt of the complaint, the lupon chairman 
day summon the respondent(a), with notice to the 
heir witnesses to appear before him for a mediation 
If he fails in his mediation effort within fifteen (15) 
the parties before him, he shall forthwith set a date 
langkat in accordance with the provisions of this 
period of offenses - While the dispute is under 
bitration, the prescriptive periods for offenses and 
ting laws shall be interrupted upon filing of the 
rangay. The prescriptive periods shall resume upon 
' the complaint or the certificate of repudiation or of 
issued by the lupon or pangkat secretary: Provided, 
on shall not exceed sixty (60) days from the filing of 
J barangay. 
ng; grounds for disqualification- The pangkat shall 
(3) days from its constitution, on the day and hour 
to hear both parties and their witnesses, simplify 
ilities for amicable settlement. For this purpose, the 
is for the personal appearance of parties and 
3nt that a party moves to disqualify any member of 
tionship, bias, interest, or any other similar grounds 
ion of the pangkat, the matter shall be resolved by 


with this section. This period shall, 
another period, which shall not 
cases. 
I 
at the discretion of the pangkat, be extendible for 
exceed fifteen (15) days, except, in clearly meritorious 
lupon shall be filed or instituted irectly in court or any other government ofice for 
adjudication, unless there has been a confrontation between the parties before the 
lupon chairman or the pangkat, an that no conciliation or settlement has been reached 
as certified by the lupon secretary or pangkat secretary as attested to by the lupon or 
(f 
.j 
pangkat chairman or unless the se ti ,lement has been repudiated by the parties thereto. 
the following instances: 
(?) 
Where the accused is under detention; 
SEC. 93. Arbitration. - (a) r h e  parties may, at any stage of the proceedings, 
I 


prescribed. The arbitration award shall be made after the lapse of the period for 
repudiation and within ten (I 
0) daysithereafter. 
(b) The arbitration award shall be in writing in a language or dialect known to the 
parties. When the parties to tpe dispute do not use the same language or dialect, 
i 
! 
I 
of-kin who are not lawyers. 
LurpOn or Pangkat. Refusal or wil 
the lupon or pangkat shall bar the 
case may be, may 
the broceedings in 
ful failure of any party or witness to appear before 
complainant from seeking judicial recourse for the 
motu proprio or upon request of a 
the interest of privacy, decency, or 
appropriate city or municipal court. 
I 
the! pangkat chairman, as the 
party, exclude the public from 
pulblic morals. 




its members, to decide on important 
SEC. 407. Functions and : 
sarigguniang kabataan shall: 
I 
issues affecting the youth of the bara~gay. 
Powers ob the ~~~~~~n~~~~ #a 
place, and agenda of the meeting 
special meetings shall be furni: 
barangay. 
A majority ofthe members oft 
sanggunian. Special meetings may 
e sangguniang kabataan shall constitute a quorum. 
be called by the sangguniang kabataan chairman or 


SEC. 409. ~
~
~
I
~
~
~
- P 
be a citizen ofthe Philippines, a qi 
ofthe barangay for at least one ( 
(151) years but not more than twei 
able to read and write Filipino, En{ 
SEC. 110. Term sf Office, - 
shall hold office for a period of tt 
provided by law, permanently inca 
SEC. 111. Sangguniang KE 
katipunan ng kabataan shall elect 
automatically serve as an ex-om 
assumption to office. As such, he 
duties and functions, and enjoy 
barangay members, and shall be 
development in the said sanggunk 
C;. 112. Duties and Bow4 
addition to the duties, which may I 
sangguniang kabataan chairman s 
a) Call and preside over all 
sangguniang kabataan; 
(b) Implement policies, progra 
with the sangguniang bara 
(c) Exercise general supervis 
kabataan and the oficial c 
sangguniang kabaiaan wit 
(d) With the concurrence of 
members of the sanggunii 
other officers as may be dt 
(e) Exercise such other power: 
by law or ordinance. 
SEC. 113- Sz!?gp!?iF?g Wl 
secretary shall: 
. 
(a) Keep all records of the kati 
k. 
elective official of the sangguniang kabataran must 
lified voter ofthe katipunan ng kab&,,aan, a rsident 
year immediately prior to election, at least fifteen 
/-one (21) years of age on the day of his eiecilan, 
sh, or the local dialect. 
he sangguniang kabataan chairman and members 
?e (3) years, unless sooner removed ~ G ~ G T  
cause 2s 
icitated, die or resign from office. 


sangguniang kabataan; 
Prepare all forms necessary lor the conduct af registrations, ekt!=r?z, 
initiatives, referenda, or plebiscites, in coordinatior! with the be. 2: LJ 
and the Comelec; and 
eg-e.. 
a,., "^*'pl-" 
kj. PEzLI,\Q:p 
1 
rrnnni zm;emm I,r*ha.Cc-- - e \ z  
Perform such other duties as. the chairman of tha 
v "M. 
Q- 
.%*V 
L2.-.= 
-. . * G . x  '-<+ I--..3=----<L--<%: . : : :--- 
- 
prescribe or direct. 
I 
Provided. that, to qualify for the irivilege, the said sfficiak shall ertmf! in the stak 
kabataan chairman refuses to asshrne ofice, fails fo qual@, is convicfeed of a W s i i y ,  
voluntarily resigns, dies, is permanently i n ~ ~ ~ ~ c j t ~ t ~ ~ :  
is 
heen absent without leave for morelthan three (3) 
. .  cmsecutive mcmthsl, t 
.i 
kabataan member who obtained the next ~~~~~~t number of votes in the electkm 
1 
r) .. 
.. 
i 
irrimediately preceding shall assurn the office of the chairman f x  the unzx 




I 






sanggunian, said vacancy 
of the organization concer 
SEC. 227. Te~pC$r2F6 
\fa 
(ai When the governor, city or r 
Incapacitated to perform his dutier 
to. leave of absence, travel abrsa 
or municipai vice-mayor, or the 1 
automatically exercise the power 
concerned. excepr me power TO aI 
be exercised if the period oftemp 
(b) Said temporary incapacity 
sanggrInian of a written C?E 
he has reporled back to ofl 
iegal causes, the local ch 
documents showing that sa 
(c) When the incumbent loca 
outside his territorial jurisdi 
&\is, he may &?sign& Ir 
authorization shall specifi 
rm~lcarner? sha!f exercise i 
power to appoint, suspend, 
(d) In the event, however, that 
issue such authorization, t 
the hiahest ranking sancm 
the fourth (4th) day of abs 
limitations provided in w b s  
(e) Except as provided above 
any local official to assum 
vice-governor: the city c 
sanc~gunrat7'g baranGay EE 
of locai elective officials shall be e 
(1) Leaves Qf 3hsenc.e of tl 
or an independent coml 
duly authorized represei 


(2) Leaves of absence o f a  
be approved by the lo 
leaves of absence of the 
be approved by the vice. 
(3) Leawes of absence ol 
approved by the governc 
(4) Leave of absence of a 
municipai mayor: Pra 
barangay members sha 
(b) Whenever the applicatior 
acted upon within five (5) 
leave of absence shall be 
ofFicer of the sangguniang pntr 
$.- nmimc!mdj 
-.. ‘ 
~ 
the rrtimicipa,! VJCW 
barangay, of the sangguniang bar 
consideration by the sanggunian c 
(b) 11-1 the event oft 
with a sanggunil 
quorum snaii ei 
officer. He shai 
ordinances enac 
session over whl 
foliowing the election of its me 
sanggunian concerned may adept 
(b) The rules of procedure shal 
(I) 
The organization of 
3s the creation of s‘ 
be limited to, the 
human rights, youtf 


(2) The order and calendai 
(3) The legislative process 
4) 
1. 
. The parliamentary proc 
(5) discipline of membe 
j~s~tifiable 
cause for four (4) con! 
reprimanded, or excluded from tl 
days, or expelled; and 
sessions; 
(5) Such other rules 
disclose any business, financial, o 
c m s m ~ ~ ~ i r i t y  
- 
~ ~ 4 h i n  
the fnurt-th civ 
entity affected by any ordinance o 
which he is a member, which i 
I 
relationship shall include: 
( I )  Ownership sf slc?ck c?r c 
ordinance or resolution 
(2) Contracts or agreemer. 
resolution under cons 
constitutional Qr statutr 
interest" refers in gene1 
member Qf 2 sEngg!,!!? 
private, pecuniary, or c 
his judgment to the prej 
(b) The disciosure required 
to. the secretary of the sanggunia 
 ember. The disctosure sha!!, Ir! 
aiid shall be made in the failawing 
(1) Disclosure shall be mac 
' 3 1 1  iiie ordinance or r~ 
member did n ~ t  
particil 
ixacie before voting 01 
r . - . ~ t i ; V ¶ R F -  n*ri 
EEaUlJtyJ, BSIU 
(2) Disclosure shalt be rn~ 
If business for each session; 


I 
privilege speech on a rn tter that may affect the business interest, financial 
connection, or profession I relationship described herein. 
1 
SEC. 132. Sessions. - (a) 
the election of its members, the : 
place of its regular sessions. The 
week for the sangguniang panlal 
biayan, and twice a month for the 
(b) When public interest so 
chief executive or by a majority of 
(c) All sanggunian sessior 
session is ordered by an affirmat 
being a quorum, in the public intc 
No two (2) sessions, regular or spl 
(d) In the case of special s 
members shall be served person; 
twenty-four (24) hours before the ! 
Unless otherwise concur1 
members present, there bc 
a special session except t! 
(9 Each sanggunian shall kec 
be published upon resoluti 
SEC. 133. Quorum. - (a) 
have been elected and qualified I 
Should a question of quorum be 
irrimediately proceed to call the rol 
(b) Where there is no quo 
such time as a quorum is constitul 
from day to day and may compc 
without justifiable cause by desigr 
a member or members of the pol 
local government concerned, to 
session. 
(c) If there is still no quorum ( 
subsection, no business SI 
motion duly approved by 1 
adjourned for lack of quorL 
1 an the first day of the session immediately following 
ggunian shall, by resolution, fix the day, time, and 
Tinimum number of regular sessions shall be once a 
wigan, sangguniang panlungsod, and sangguniang 
mgguniang barangay. 
smands, special sessions may be called by the local 
ke members of the sanggunian. 
\shall be open to the public unless a closed-door 
vote of a majority of the members present, there 
1 ?st or for reasons of security, decency, or morality. 
'ial, may be held in a single day. 
jsions of the sanggunian, a written notice to be the 
I 
y at the member's usual place pf residence at least 
jecial session is held. 
I 
b in by two-thirds (2/3) vote of the sanggunian 
I ig a quorum, no other matters may be considered at 
I lse stated in the notice. 
1 a journal and record of its proceedings, which may 
7 of the sanggunian concerned. 
I 
I 
1 
B 
I 
I 
r 
I 
I 
I 
,majority of all the members of the sanggunian who 
&I1 constitute a quorum to transact official business. 
-aised during a session, the presiding officer shall 
D f  the members and thereafter announce the results. 
lm, the presiding officer may declare a recess until 
cf, or a majority of the members present may adjourn 
the immediate attendance of any member absent 
ting a member of the sanggunian, to be assisted by 
e force assigned in the territorial jurisdiction of the 
rrest the absent member and present him at the 
'spite the enforcement of the immediately preceding 
ill be transacted. The presiding officer, upon proper 
B members present, shall then declare the session 
1. 


SEC. 134. Approval of Out 
panlalawigan, sangguniang panlun 
the provincial governor or city or m 
executive concerned approves the 
page thereof; otherwise, he shall v 
sanggunian, which may proceed tc 
may override the veto of the loca 
members, thereby making the ordii 
purposes. 
(b) The veto shall be commu 
sanggunian within fifteen (1 5) day: 
case of a city or a municipality; othc 
(c) Ordinances enai 
approval by the II 
barangay. 
had signed it. 
SEC. 135. Veto Power of I 
executive may veto any ordinanc 
panlungsod, or sangguniang bayai 
the public welfare, stating his reasc 
(b) The local chief exec1 
power to veto any partici 
ordinance or resol ut ion 
investment program, or 
creating liability. In such 
which are not objected 
unless the sanggunian 01 
the item or items in tP 
corresponding to those vt 
(d) The local chief e 
once. The sang! 
executive concer 
thereby making tl 
names. - (a) Every enacted by the sangguniang 
sod, or sangguniang bayan shall be presented to 
nicipal mayor, as the case may be. If the local chief 
am@, he shall affix his signature on each and every 
to it and return the same with his objections to the 
reconsider the same. The sanggunian concerned 
chief executive by two-thirds (23) voted of all its 
m e  or resolution effective for all legal intents and 
icated by the local chief executive concerned to the 
in the case of a province, and ten (IO) days in the 
wise, the ordinance shall be deemed approved as if 
ed by the sangguniang barangay shall, upon 
ajority of ail its members, be signed by the punong 
he Local Chief Executive. - (a) The local chief 
of the sangguniang panlalawigan, sangguniang 
on the ground that it is ultra vires or prejudicial to 
s therefore in writing. 
live, except the punong barangay, shall have the 
3r item or items of an appropriations ordinance, an 
adopting a local development plan and public 
In ordinance directing the payment of money or 
1 case, the veto shall not affect the item or items, 
b. The vetoed item or items shall not take effect 
imides the veto in the manner provided; otherwise, 
1 appropriations ordinance of the previous year 
oed, if any, shall be deemed reenacted. 
ecutive may veto an ordinance or resolution only 
mian may override the veto pf the local chief 
ed by two-thirds (2/3) vote of all its members, 
2 ordinance effective even without the approval of 


I 
SEC. f36. Review QI 
unicipal 
Rer;olution by the Sanggunia 
approval, the secretary to the 
forward to the sangguniang pan 
the resolutions approving the I 
formulated by the local develo 
alawigan. - (a) Within three (3) days after 
ang panlungsod or sangguniang bayan shall 
for review, copies of approved ordinances and 
pment plans and public investment programs 
eipt of copies of such ordinances and 
hall examine the documents or transmit 
e none to the provincial prosecutor for 
or provincial prosecutor shall, within a 
e documents, inform the sangguniang 
(b) Within thirty (30) 
resolutions, the sangguniang 
them to the provincial attorn 
prompt examination. The p 
period of ten (IO) days f 
panlalawigan in writing of hi 
by the sangguniang panlal 
(c) If the sanggunian 
beyond the power 
an ordinance or resolution is 
g panlungsod or sangguniang 
or resolution invalid in whole 
nter its action in the minutes 
al authorities of the action it 
and shall advise 
has take. 
gguniang panlalawigan with 
an ordinance or resolution, 
ith law and thereof valid. 
Sangguniang Panlungsod 
nactment, the sangguniang 
nces to the sangguniang 
to whether the ordinance is 
n, as the case may be, fails 
(30) days from receipt 
n, as the case may be, 
or city or municipal 
ordinances, the sanggunia 
cerned shall within thirty (30) days from receipt 
thereof, return the same 
its comments and recommendations to the 


sangguniang barangay c 
in which case, the effecti 
time as the revision calle 
SEC. 138. Enforc 
Any attempt to enforce 
development plan and p 
by higher reviewing aut 
dismissal of the official 
ed for adjustment, amendment, or modification; 
he barangay ordinance is suspended until such 
roved Ordinances or Resolutions. - 
r any resolution, including the local 
rogram, after the disapproval thereof 
fficient ground for the suspension or 
or Resolutions. (a) Unless 
ding the local development plan 
take effect after ten (IO) days 
tin board at the entrance of the 
all, as the case may be, and in 
al government concerned. 
all cause the posting of an 
e entrance of the provincial 
at least two (2) conspicuous 
ter than five (5) days after 
otherwise in the ordi 
and public investm 
from the date a co 
provincial capitol o 
at least two (2) 0th 
(b) The secretary 
ordinance or r 
approval thereof. 
isseminated and posted in 
derstood by the majority of 
and the secretary to the 
r the purpose, stating the 
in a newspaper of general 
islative body concerned 
ral circulation within the 
in all municipalities and 
e ordinance or 


Article F 
SEC. 140. Grounds for Dis 
disciplined, suspended, or remove( 
(a) Dishonesty, oppression, 
(b) An elective local official 
above by order of the proper court. 
SEC. 141. Form and Fil 
coimplaint against any local electiw 
as follows: 
of 'duty; 
a) A complaint against any ele 
independent component cit 
shall be filed before the Off1 
(b) A complaint against any e 
shall be filed before the san 
(d) A complaint agaii 
the sangguniang 
SEC. 142. Notice of Hearin 
complaint is filed, the Office of the 
may be, shall require the responc 
days from receipt thereof, and cor 
da,ys after receipt of such answer c 
(b) When the respondent is 
city, such hearing and investigatior 
hallds ofice. For all other local elec 
sanggunian concerned is located. 
(c) However, no investigation I 
to any local election, and n 
said period: If preventive s 
days period immediately 
automatically lifted upon thl 
(e) The sanggunian 
copies of both ( 
official o f a  provi 
city; the provinci: 
+$ 
ir. Disciplinavy Aq'ti'ons 
. , A 
plinary Actions. - An elective local official may be 
rom office on any of the following grounds: 
sconduct in office, gross negligence, or dereliction 
ay be removed office on the grounds enumerated 
g of Administrative Complaints. - A verified 
fficial shall be filed with the disciplining authorities, 
Je official ofa province, a highly urbanized city, an 
ir component city or municipality in Metro Manila 
of the President; 
3ive official of a component city or a municipality 
uniang panlalawigan; and 
t any elective barangay official shall be filed before 
inlungsod or sangguniang bayan concerned. 
- (a) Within seven (7) days after the administrative 
.esident or the sanggunian concerned, as the case 
it to submit his verified answer within fifteen (15) 
ience the investigation of the case within ten (IO) 
he respondent. 
I elective official of a province or highly urbanized 
hall be conducted in the place where he renders or 
/e officials, the venue shall be the place where the 
ill be held within ninety (90) days immediately prior 
preventive suspension shall be imposed within the 
pension has been imposed prior to the ninety (90) 
receding local election, it shall be deemed 
itart of aforesaid period. 
ncerned shall furnish the local chief executive with 
nplaint and answer of respondent local elective 
e,*highly organized or an independent component 
jovernor of an elective official of a component city 


or municipality; o 
the barangay; 
SEC. 143. Preventive Su 
imposed : 
(I) By the President, if the re 
urbanized or an independ 
(2) By the governor, if the re 
(3) By the mayor, if the respc 
(b) Preventive suspension ma! 
when the evidence of guilt i 
great probability that the cc 
the witnesses or pose a tl 
other evidence: Provided, 
elective officials shall not e 
in the event that several 
official, he cannot be prev 
within a single year on the 
time of the first suspension 
(c) Upon expiration of the prc 
shall be deemed reinstatec 
proceedings against him, u 
(120) days from the time 
However, if the delay in thc 
or request, other than the I 
be counted in computing th 
municipality; or 
SEC. 144. Salary of Res1 
ofl’lcial preventively suspended fr 
during such suspension; but, upon 
be paid full salary or compensatic 
suspension. 
he city or municipal mayor if an elective official of 
aension. - (a) Preventive suspension may be 
Iondent is an elective official ofa province, a highly 
rt component city or municipality in Metro Manila; 
iondent is an elective official ofa component city or 
dent is an elective official of the barangay. 
)e imposed at any time after the issues are joined, 
strong, and given the gravity of the offense, there is 
inuance in office of the respondent could influence 
?at to the safety and integrity of the records and 
-hat, any single preventive suspension of local 
2nd beyond sixty (60) days: Provided, further, That 
ciministrative cases are fiteci against an elective 
rtively suspended for more than ninety (90) days 
ame ground or grounds existing and known at the 
mtive suspension, the suspended elective official 
n office without prejudice to the continuation of the 
ich shall be terminated within one hundred twenty 
e was formally notified of the case against him. 
lroceedings of the case is due to his fault, neglect, 
peal duly filed, the duration of such delay shall not 
time of termination of the case. 
indent Pending Suspension. - The respondent 
n office shall receive no salary or compensation 
ubsequent exoneration and reinstatement, he shall 
including such emoluments accruing during such 


ent - The respondent shall be accorded full 
self in person or by counsel, to confront and 
m, and to require the attendance of witnesses 
idence in his favor through the compulsory 
opportunity to appear and defe 
cross-examine the witnesses ag 
and the production of dOCume 
process of subpoena or subpoe 
; 
SEC. 146. Form and Notic 
shall be terminated within ninety (s 
after the end of the investigatio 
concerned shall render a decision 
reiasons for such decision. Copie2 
respondent and all interested partii 
(b) The penalty of susp 
respondent or a period c 
shall said penalty be a b 
as long as he meets the 1 
(c) The disciplining authority 
provided shall be exclusiv 
to an administrative compl 
of by the disciplining authc 
No public authority or official shall give due course 
SEC. 147. Administrative 
within thirty (30) days from receipt ereof, be appealed to the following: 
wigan, in the case of decisions of the sangguniang 
and the sangguniang bayan of component 
e President, in the case of decisions of the 
(a) The sangguniang panlal 
panlungsod of component citk 
municipalities; and 
(b) The Office of 
sangguniang par 
urbanized cities 
Office of the Pre: 
SEC. 148. Execution Pend 
from becoming final or executory. 
placed under preventive suspensic 
wins such appeal. In the event thc 
seriary and such other emoluments 
ig Appeal. - An appeal shall not prevent a decision 
he respondent shall be considered as having been 
1 during the pendency of an appeal in the event he 
appeal results in exoneration, he shall be paid his 
luring the pendency of the appeal. 


H 
SEC. 149. By Whom Ex 
shall be exercised by the regis 
elective official subject to such r 
d. - The power of recall for loss of confidence 
oters of a local government to which the local 
SEC. 150. Initiation o 
Process. - (a) Recall of any elective 
may also be validly initiated upon petition 
al number of registered voters in the local 
in which the local official sought to be 
prlovincial, city, municipal, or b 
of at least twenty-five percent 
government concerned durin 
recalled was elected. 
(I) A written petition 
representative, an 
representative oft 
province, city, mu 
with the Comelec 
Comelec or its d 
ned before the election registrar or his 
f a  representative of the petitioner and a 
be recalled, and in a public place in the 
ay, as the case may be, shall be filed 
the local government concerned. The 
entative shall cause the publication of 
s place for a period of not less than ten 
days, for the purpose of verifying the 
etition and the required percentage of 
d, the Comelec or its duly authorized 
eptance of candidates to the position 
ates which shall include the name of 
voters. 
(3) Upon the laps 
and thereafter 
the official sou 
SEC. 161. Electi 
for recall with the appr 
authorized representati 
later than thirty (30) da 
of the barangay, city, 
provincial officials. Th 
considered as duly re 
like other candidates, 
SEC. 152. Effe 
effective only upon th 
candidate receiving t h 
filing of a valid resolution or petition 
omelec, the Commission or its duly 
lection on recall, which shall not be 
tion or petition for recall in the case 
rty-five (45) days in the case of 
be recall shall automatically be 
s to the pertinent positions and, 
an elective local official shall be 
successor in the person of the 
ring the election on recall. 


Should the official sought to be r 
him is thereby affirmed, and he 
ceive the highest number of votes, confidence in 
ntinue in office. 
SEC. 153. Prohibition 
recalled shall not be allowed t 
ignation- The elective local official sought to be 
hile the recall process is in progress. 
SEC. 154. Limitation 
subject of a recall election on 
(b) No recall shall take 
assumption to offic 
election. 
II. - (a) Any elective local official may be the 
ng his term of ofice for loss of confidence. 
n one (I) year from the date of the official's 
year immediately preceding a regular local 
SEC. 155. Expense 
recall elections shall be bo 
Recall Elections. - All expenses incident to 
Common Duties a 
Local Government Officials 
Article One. The Ch 
ces, Cities and Municipalities 
rs. - (a) The provincial governor, city 
of the provincial, city and municipal 
e such powers as herein provided. 
over all local government programs, 
s connection, shall: 
d guidelines and be responsible to 
, and upon approval thereof 
ian at the opening of its 
SEC. 156. Tile Co 
mayor and municipal11 l a  
governments, shall perfo 
regular session. 
nd wages are wholly or 
f salaries or- wages of 
ordance with law or 
nsactions and sign in 


~ 
its behalf all bonc 
indebtedness. 
(viii) Carry out such em€ 
immediately after mal 
(ix) Ensure that all loc 
discharge their duties 
institute administrati 
thereof. 
(x) Examine the books, rl 
offices, officials, agen 
and authority, require 
assigned to his politic 
records, and other do 
law as confidential; 
(xi) Furnish copies of z 
governor in the case c 
Office of the Presiden 
the case of provincial 
within seventy two (72 
(xii) Visit at least once ir 
case of the city or 
municipalities, in the 
understanding of pro 
counsel to local officia 
and inhabitants of ge 
them, and otherwise 
governance of his pol 
inhabitants; 
(xiii) Act on leave applicai 
the commutation o 
accordance with law; 
(xiv) Authorize official trip 
their official stations 1 
(xvi) Call upon any nation 
local government tc 
jurisdiction and to m, 
ofTicial or employee ir 
contracts, and obligations, and such other 
lency measures as may be necessary during and 
made and natural disasters and calamities; 
I government officials and employees faithfully 
nd functions as provided by law and this Code, and 
i or judicial proceedings against any violation 
ords and other documents of all local government 
or employees and, in aid of his executive powers 
ill national officials and employees stationed in or 
jurisdiction, to make available to him such books, 
iments in their custody, except those classified by 
scutive orders issued by him, to the provincial 
zomponent city mayors and municipal mayor, to the 
n the case of highly-urbanized city mayors, and in 
overnors, as well as to others as provided bylaw, 
lours after their issuance; 
!very six (6) months, component barangays, in the 
nunicipal mayor; and of component cities and 
;ase of the provincial governor, to deepen his 
ems and conditions, listen and give appropriate 
and inhabitants, inform the respective local officials 
bra1 laws and ordinances which especially concern 
onduct visits and inspections to ensure that the 
:a1 jurisdiction will improve the quality of life of the 
ns of officials and employees appointed by him and 
the monetary value of their leave credits in 
i f  local government officials and employees outside 
a period not exceeding thilly (30) days; 
official or employee stationed in or assigned to his 
advise him on matters affecting his territorial 
e recommendations thereon; coordinate with said 
he formulation and implementation of plans, 


programs and proje 
judicial action agai 
have committed a 
stationed in or as 
nd, when appropriate, initiate an administrative or 
ational government official or employee who may 
e in the performance of his official duties while 
the concerned local government; 
(xv) Authorize pa 
r medical care, necessary transportation, 
edical fees of local government officials and 
while in the performance of their official duties 
(mi) Solemnize mar 
(xvii) Submit to im 
which should c 
ase of the city or municipal mayor; 
er authorities concerned, an annual report 
rehensive summary of all matters pertinent to 
tion" and describing therein the prevailing 
conditions; and in addition thereto, submit 
e during the year when unexpected events 
the general welfare of the people and the 
mplement all approved policies, programs, 
to local governance in the exercise of the 
above provided, and in addition to the 
and situations 
(2) Enforce all laws an 
projects, services a 
appropriate corpor 
foregoing, shall: 
(i) Ensure that th 
ment officials and employees are within 
(iii) Issue such executive orc 
execution of laws and or 
(iv) Be entitled to carry the n 
(v) With specific applicatioi 
implement a peace and c 
the National Police Comn 
control and supervision ( 
No. 6975; and with specif 
(ii) Call conventions, confe 
ces, seminars, or meetings of any elective and 
appointive officials wo 
g under such local government; including officials 
from other local gov 
ents; as well as those national officials and 
employees stationed i 
signed within such political unit, at such time and 
place and on such su 
may be deemed important for the promotion of 
the general welfare o 
cted inhabitants therein; 
hs for the faithful and appropriate enforcement and 
li nances; 
cessary firearm within his territorial jurisdiction; 
to 
municipal and city mayors, formulate and 
er plan; and act as the deputized representative of 
ission and as such exercise general and operational 
Ier the local police forces in accordance with R.A. 
: reference to provincial governors, formulate a local 
I 


government peace an 
municipalities and co 
same; 
er plan in coordination with the mayors of 
t cities, and upon its approval, implement the 
(vi) Call upon the approp 
riot, lawless violence 
law when public inter 
inadequate to cope w 
enforcement agencies to suppress disorder, 
n or sedition, or to apprehend violators of the 
uires and when the assigned p o k e  forces are 
ation or the violators; 
neration of resources and revenues, for the 
ent plans, program objectives and priorities, 
ed for agro-industrial development and 
ss and, relative thereto, shall: 
(3) 
Initiate and opti 
d of an office or department to prepare and 
of appropriations for the ensuing calendar year, 
the budget preparations process as provided by 
it to the sanggunian for approval the executive 
local government budgets for the ensuing 
manner as provided by law; 
I government taxes and other revenues are 
local government funds are applied to the 
ding expenses and settlement of obligations, 
its and suspend or revoke the same for any 
s upon which said licenses or permits had 
law or ordinance; 
ed of approval therefor from any national 
f activities for any charitable or welfare 
ited games of chance or shows contrary 
d houses, buildings or other 
it, subject to such fines and 
or ordinance, or to make 
n of the same when said 
inance, or to order the 
ding or structure within the 
ard and conserve land, 
resources of the local 


ide efficient and effective property and supply 
overnment; and protect the 
and other properties of such local government; 
(viii) institute or 
to be instituted administrative or judicial 
ation of ordinances in the collection of taxes, 
for the recovery of funds and property; and 
f the local government against all suits to 
ts, resources and rights shall be adequately 
ic services and the provision of adequate 
er Section 15 of this Code and, in addition 
thereto, shall: 
ruction and repair of roads and highways 
government shall be, as far as practicable, 
lly contiguous manner and in coordination 
and repair of the roads and bridges in 
f technical services, including 
infrastructure programs that are undertaken by 
such other duties as may be 
hall hold ofice in the provincial 
unicipal hall in the case of the 
city or municipality. 
nicipal Vice-Mayor 
(a) The vice governor of a 
ng sanggunian, as the case 
the p rovincelcitylmunici pal 
for the operation of the 
for the unexpired term of the 
ed for in Section 125 of this 


(3) 
Exercise the powers 
cases of temporary 
and 
(4) 
Appoint officials and 
(5) 
Exercise and perforn 
by law or ordinance. 
SECTION 158. Local Leg 
exercised by the sanggunii 
panlungsod for the city; th 
sangguniang barangay for f 
Acts of the sanggunian sha 
or order and be enforceable in the 
Article Three. - 
SECTION 159. Duties and 
following duties and powers: 
(I) Act as either chairma 
(2) 
Introduce or propos 
supportive to prograr 
be. 
(3) 
Assist the local chic 
powers. 
(4) 
Discharge his duties 
(5) 
Articulate the needs : 
(6) 
Perform other relatr 
sanggunian as the la 
id perform the duties of the local chief executive in 
bancy as provided for in Section 127 of this Code; 
nployees of the sanggunian concerned. 
uch other powers and duties as may be prescribed 
lative Power. - Local legislative power shall be 
g panlalawigan for the province; the sangguniang 
sangguniang bayan for the municipality; and the 
barangay. 
issume the shape or form of ordinance, resolutions 
cal government concerned. 
le Members of the Sanggunian 
Bwers. - Members of the sanggunian shall have the 
3r member of a standing committee. 
legislative measures, ordinances or resolutions 
if province, city or municipality as to the case may 
executive in the performance of his duties and 
a person in authority whenever necessary. 
d aspiration of his constituents in the sanggunian. 
and policy making body. 
duties that will enhance the effectivity of the 


Common Provisi 
Article One. - The Sanggur 
and the I 
SECTION 160. - Common 
legislative body, shall enact ordin 
the general welfare of the local goi 
this Code and in the proper exe 
Section 20 of this Code. The sang 
(I) Approve/Enact ordir 
efficient and effectiw 
(i) 
It shall formu 
. government p 
(ii) 
Require all 
I 
indicators. 
(iii) 
Monitor the Irr 
(iv) 
Sangguniang 
ordinances ay 
orders issue 
application to 
approved by t 
as well as ex 
cities and mur 
(v) 
Enact measui 
riot, and violer 
(vi) 
Impose penall 
(aa) 
Violatic 
exceed 
(bb) Violatio 
one (I) 
(cc) Violatio 
exceed 
(vii) 
Adopt rneasur 
Chapter 3 
s Applicable to the Sanggunian 
ng Bayan; The Sangguniang Panlungsod; 
gguniang Panlalawigan; 
nctions and Powers. - (a) The sanggunian, as the 
:es, approve resolutions and appropriate funds for 
nment and its inhabitants pursuant to Section 14 of 
,e of its corporate powers as provided for under 
iian shall : 
ces and adopt resolutions designed to promote 
cal governance: 
: an annual Legislative agenda in support of the 
ram. 
:es 
to formulate their respective performance 
!mentation of respective office mandates. 
van and sangguniang panlungsod shall review all 
wed by the sangguniang barangay and executive 
by the punong barangay; and with specific 
! sangguniang panlalawigan, review all ordinances 
sanggunian of component cities and municipalities 
Jtive orders issued by the mayors of component 
oalities; 
to prevent and suppress lawlessness, disorder, 
for the violation of said ordinances; 
of provincial ordinance - An imprisonment not 
one (1) year. 
)f city ordinance - An imprisonment not exceeding 
x. 
Df municipal ordinance - An imprisonment not 
one (I) 
year. 
to protect the inhidbitants of the locdl government 


concerned fro 
disasters and 
assistance for 
or calamities a 
events; 
(viii) 
Enact ordinan 
appropriate PE 
vagrancy, 
n 
maintenance o 
games of chan 
property, drug 
juvenile delinc 
obscene or PO 
activities inimic 
concerned loc: 
(ix) 
Protect the eni 
which endangc 
other forms of 
logs, smugglin 
species of flori 
.activities whict 
rivers and lake 
(x) 
Determine the 
local governmt 
(xi) 
Determine the 
other emolumc 
wholly or mai 
necessary for 
and activities c 
(xii) 
Authorize the f 
the governmer 
honorarium to 
temporary vaci 
by law; 
(xiii) 
Provide a mecl 
the safety and 
documents, or 
land ownership 
the harmful effects of man-made or natural 
Zalamities, and to provide relief services and 
ztims during and in the aftermath of said disasters 
I their return to productive livelihood following said 
5s intended to prevent, suppress and impose 
3lties for habitual drunkenness in public places, 
ndicancy, 
prostitution, 
establishment 
and 
louses of ill repute, gambling and other prohibited 
3, fraudulent devices and ways to obtain money or 
Idiction, maintenance of drug dens, drug pushing, 
ency, the printing, distribution or exhibition of 
ographic materials or publications, and such other 
to the welfare and morals of the inhabitants of the 
jovernment; 
onment and impose appropriate penalties for ads 
the environment, such as dynamite fishing and 
sstructive fishing, illegal logging and smuggling of 
of natural resources products and of endangered 
and fauna, slash and burn farming, and such other 
esult in pollution, acceleration of eutrophication of 
or of ecological imbalance; 
iwers and duties of officials and employees of the 
t concerned; 
ositions and the salaries, wages, allowances and 
ts and benefits of officials and employees paid 
y from city funds and provide for expenditures 
e proper conduct of programs, projects, services, 
he local government concerned; 
yment of compensation to a qualified person not in 
service who fills up a temporary vacancy or grant 
iy qualified official or employee designated to fill a 
cy in a concurrent capacity, at the rate authorized 
nism and the appropriate funds therefor, to ensure 
lrotection of all local government property, public 
cords such as those relating to property inventory, 
-ecords of births, marriages, deaths, assessments, 


taxation, accoi 
documents of I 
local governmc 
(xiv) When the fin; 
additional all0 
public elemen 
government o 
jurisdiction o f t  
(xv) 
Provide legal 
performance o 
to initiate judic 
action; and pi 
coverage for a 
tanod brigade 
insurance corr 
allow said COVC 
(2) 
Generate and optirr 
development plans, 
government with par 
local government-wic 
shall: 
(i) 
Approve the 
government ar 
services and a 
‘order to prom( 
its inhabitants; 
(ii) 
Enact ordinanc 
rates thereof 1 
exemptions, in 
(iii) 
Authorize the I 
and other form 
(iv) 
Enact ordinar 
instruments of 
finance develo 
(v) 
Appropriate fu 
rental of build1 
upon the majc 
authorize the I 
ts, business permits, and such other records and 
blic interest in the offices and departments of the 
ces of the local government allow, provide for 
mces and other benefits to judges, prosecutors, 
y and high school teachers, and other national 
Zials stationed in or assigned to the territorial 
! local government; 
assistance to barangay officials who, in the 
heir official duties or on the occasion thereof, have 
I proceedings or defend themselves against legal 
ride for group insurance or additional insurance 
barangay officials, including members of barangay 
and other service units, with public or private 
anies, when the finances of the local government 
%e; 
e the use of resources and revenues for the 
)rogram objectives and priorities of the local 
ular attention to agro-industrial development and 
growth and progress, and relative thereto, and 
nnual and supplemental budgets of the local 
appropriate funds for specific programs, projects, 
ivities, or for other purposes not contrary to law, in 
3 the general welfare of the local government and 
s levying taxes, fees and charges, prescribing the 
general and specific purposes, and granting tax 
lntives or reliefs; 
:al chief executive to negotiate and contract loans 
3f indebtedness; 
?s authorizing the floating of bonds or other 
idebtedness, for the purpose of raising funds to 
nent projects; 
Is for the construction and maintenance or the 
3s for the use of the local government unit; and, 
ty vote of all the members of the sanggunian, 
:al chief executive to lease to private parties such 


public building 
laws, rules anc 
(vi) 
.Prescribe reas 
within the juris( 
(vii) 
Adopt a comp 
Provided, that 
the formulatioi 
coordination v\r 
plan; Providec 
component cii 
sangguniang F 
(viii) Sangguniang I 
land within thc 
pertinent provi 
(ix) 
Sangguniang 
integrated zor 
comprehensiw 
and regulatioi 
populous cer 
modification o 
that zoning or( 
be reviewed b! 
(x) 
Sangguniang 
national law, p 
commercial, 
1 
purposes, and 
‘proceeds of \I\ 
Provided, how 
office is requirt 
thirty (30) day: 
application wii 
approved then 
(xi) 
Sangguniang I 
provisions of T 
constructing fi: 
bangus fry, prz 
within the territ 
(xii) 
Sangguniang 
held in a proprietary capacity, subject to existing 
egulations; 
iable limits and restraints on the use of property 
:tion of the local government; 
hensive land use plan for the local government: 
I the case of component cities and municipalities, 
adoption or modification of said plan shall be in 
I the approved provincial comprehensive land use 
urther, that the comprehensive land use plans of 
s and municipalities shall be reviewed by the 
ilal awig a n ; 
yan and sangguniang panlungsod shall reclassify 
urisdiction of the local government, subject to the 
Ins of this Code; 
layan and sangguniang panglungsod, enact 
ig ordinances in consonance with the approved 
land use plan, and subject to existing laws, rules 
; establish fire limits or zones, particularly in 
!rs; and regulate the construction, repair or 
wildings within said fire limits or zones; provided 
lances of component cities and municipalities shall 
he sangguniang panlalawigan; 
ayan and sangguniang panlungsod subject to 
cess and approve subdivision plans for residential, 
industrial purposes and other development 
o collect processing fees and other charges, the 
ch shall accrue entirely to the local government: 
fer, That where approval of a national agency or 
I, said approval shall not be withheld for more than 
rom receipt of the application. Failure to act on the 
n the period stated above shall be deemed as 
I 
f; 
yan and sangguniang panlungsod subject to the 
3 Nine of this Code, grant the exclusive privilege of 
corrals or fish pens, or the taking or catching of 
n fry or kawag-kawag, or fry of any species or fish 
ial waters of the local government; 
ayan, sangguniang panglunsod and with the 


least two-thirds (213) of all the members of the 
tax exemptions, incentives or reliefs to entities 
unity growth-inducing industries, subject to the 
and sangguniang panlungsod shall grant loans 
to other local governments or to national, 
ity charitable, benevolent or educational 
d, That, said institutions are operated and 
territorial jurisdiction of the local government; 
and sangguniang panlungsod shall regulate 
idential, commercial and other buildings; and, 
ion, weighing and measuring of articles of 
commerce. 
(3) 
Enact ordinances 
ing franchises and authorizing the issuance of 
ch conditions and for such purposes intended 
re of the inhabitants of the local government 
reasonable fees and charges for all services 
cal government to private persons or entities; 
city and municipality, regulate or fix license fees 
or practice of profession within the local 
e conditions under which the license for said 
e of profession may be revoked and enact 
axes thereon; and in the case of the province, 
se fees as provided for in this Code; 
iity shall provide for and set the terms and 
ich public utilities owned by the local 
perated by the said local government, and 
s under which the same may be leased to 
es, preferably cooperatives; 
all regulate the display of and fix the license 
rds, or billboards at the place or places 
business advertised thereby is, in whole or 
II any law to the contrary notwithstanding, 
the 
establishment, 
operation, and 
and regulate cockfighting and commercial 
Provided, That existing rights should not 


I 
(vi) 
A city or mun 
ity shall regulate the operation of tricycles and 
r the operation thereof within the territorial 
a1 government concerned; 
lity shall grant a franchise to any person, 
ion, or cooperative to do business; establish, 
nd maintain ferries, wharves, markets or 
ndertake such other activities within the local 
d, 
That, 
cooperatives shall be given 
of such a franchise. 
or shall regulate activities relative to the use 
tures within the jurisdiction of the local 
e the general welfare and for said purpose 
(vii) 
A city or m 
, or abate any nuisance; 
*, lodging houses, and other similar establishments, 
(i) 
Declare, preve 
(ii) Require that building 
territorial jurisdiction of i 
sanitary condition; impos 
to comply with said requ 
owner, administrator or t t  
or premises to a grade nt 
nicipality mayor shall regulate the sale, giving away 
A city and a 
clinical and ot 
establishment5 
A city and a r 
operation and 
pension house 
including touris 
A city and a mi 
or dispensing ( 
liquors at any r 
A city and a r 
and provide fc 
device in buill 
combustible m 
government; 
(vii)A city and a muni 
operation, and maintena 
:ipality mayor shall regulate the establishment, 
tce of any entertainment or amusement facilities, 


~ 
including theatrical per- 
schools, public dance hz 
for entertainment or ami 
amusement or entertair 
community or annoy the 
of the same; or, prohibit 
to protect the social and 
(viii) A city and a TT 
stray animals; 
of a business 
and adopt mc 
and, 
A city and a I 
.operation, anc 
cremation of 
regulations. 
(ix) 
(5) 
Approve ordinances 
of the basic services 
Code, and in additior 
(i) 
Provide for 
conservation 
greenbelts, n 
projects; 
(ii) 
Establish mari 
the operation 
construction E 
similar buildin! 
(iii) 
Authorize the 
local governm 
to accelerate 
offshore activii 
(iv) 
Regulate the 
vegetables, fr 
public consurn 
parks and ot 
improvement, 
and vehicle stc 
(v) 
Regulate the 
.mantes, circuses, billiard pools, public dancing 
3, skuna baths, massage parlors, and other places 
emint; regulate such other events or activities for 
haditants, or require the suspension or suppression 
!rta/n forms of amusement or entertainment in order 
oral welfare of the community; 
7icibality mayor shall provide for the impounding of 
rid( the slaughter, sale or disposition of the same; 
ien t! , particularly those which tend to disturb the 
sgu,ate 
I 
the keeping of animals in homes or as part 
I 
sures to prevent and penalize cruelty to animals; 
1 
I 
inicipality mayor shall regulate the establishment, 
maintenance of funeral parlors and the burial or 
he dead, subject to existing laws, rules, and 
iich shall ensure the efficient and effective delivery 
?d facilities as provided for under Section 15 of this 
o said services and facilities, shall: 
e establishment, maintenance, protection, and 
communal forests and watersheds, tree parks, 
ngroves, and other similar forest development 
ts, slaughterhouses or animal corrals and authorize 
iereof by the city government; and regulate the 
j operation of private markets, talipapas or other 
and structures; 
stablishment, maintenance and operation by the 
it of ferries, wharves, and other structures intended 
woductivity related to marine and seashore or 
preparation and sale of meat, poultry, fish, 
:s, fresh dairy products, and other foodstuffs for 
ion; 
,e of streets, avenues, alleys, sidewalks, bridges, 
!r public places and approve the construction, 
pair and maintenance of the same; establish bus 
s and terminals or regulate the use of the same by 


privately-owned vehicles which serve the public; regulate garages 
and the operation of conveyancies for hire; designate stands to be 
occupied by public vehicles when not in use; regulate the putting up 
of signs, signposts, awnings and awning posts on the streets; and 
provide for the lighting, cleaning and sprinkling of streets and public 
places; 
Regulate traffic on all streets and bridges; prohibit encroachments 
or obstacles thereon and, when necessary in the interest of public 
welfare, authorize the removal of encroachments and illegal 
constructions in public places; 
Subject to existing laws, establish and provide for the maintenance, 
repair and operation of an efficient waterworks system to supply 
water for the inhabitants and to purify the source of the water 
supply; regulate 'the construction, maintenance, repair and use of 
hydrants, pumps, cisterns and reservoirs; protect the purity and 
quantity of the water supply of the local government and, for this 
purpose, extendl the coverage of appropriate ordinances over all 
territory within the drainage area of said water supply and within 
one hundred (100) meters of the reservoir, conduit, canal, 
aqueduct, pumping station, or watershed used in connection with 
the water service; and regulate the consumption, use or wastage of 
water and fix and collect charges therefor; 
(viii) Regulate the drilling and excavation of the ground for the laying of 
water, gas, sewer, and other pipes and the construction, repair and 
maintenance of public drains, sewers, C ~ S S ~ O O ~ S ,  
tunnels and 
similar structures; regulate the placing of poles and the use of 
crosswalks, curbs, and gutters; adopt measures to ensure public 
safety against open canals, manholes, live wires and other similar 
hazards to life and property; and regulate the construction and use 
of private water closets, privies and other similar structures in 
buildings and homes; 
Regulate the placing, stringing, attaching, installing, repair and 
construction of all gas mains, electric, telegraph and telephone 
wires, conduits, meters and other apparatus; and provide for the 
correction, condemnation or removal of the same when found to be 
dangerous, defective, or otherwise hazardous to the welfare of the 
. inhabitants; 
Subject to the availability of funds and to existing laws, rules and 
(vi) 
(vii) 
(ix) 
(x) 


regulations, establish and provide for the operation of vocational 
and technical schools and similar post-Secondary institutions and, 
with the approval of the Department of Education, Culture and 
Sports and subject to existing law on tuition fees, fix and collect 
reasonable tuition fees and other school charges in educational 
institutions supported by the local government; 
Establish a scholarship fund for the poor but deserving students in 
schools located within its jurisdiction or for students residing within 
therein; 
Approve measures and adopt quarantine regulations to prevent the 
introduction and spread of diseases; 
Provide for an efficient and effective system of solid waste and 
garbage collection and disposal; prohibit littering and the placing or 
throwing of garbage, refuse and other filth and wastes; 
(xiv) .Provide for the care of disabled persons, paupers, the aged, the 
sick, persons of unsound mind, abandoned minors, juvenile 
delinquents, drug dependents, abused children and other needy 
and disadvantaged persons, particularly children and youth below 
eighteen (18) years of age; and, subject to availability of funds, 
establish and provide for the operation of centers and facilities for 
said needy and disadvantaged persons; 
Establish and provide for the maintenance and improvement of jails 
and detention centers, institute a sound jail management, and 
appropriate funds for the subsistence of detainees and convicted 
prisoners in the said jails and detention centers; 
(xi) 
(xii) 
(xiii) 
(xv) 
(mi) Establish, as the need arises, different councils, in 
coordination with concerned government agencies and non- 
governmental organizations and, subject to the availability of funds, 
appropriate funds, for purposes such as: 
(aa) The support; development and promotion of culture and the 
arts; 
(bb) The elderly through the formulation of policies and the 
adoption of measures mutually beneficial to the elderly and to the 
commu n ity ; 
(cc) The provision of incentives for non-governmental agencies and 
entities and, subject to the availability of funds, appropriate funds to 
support programs and projects for the benefit of the elderly; 


(6) The sanggunian shall approve proposals and appropriate the 
school board funds for the needs in the operations and 
maintenance of public schools, taking into account the priorities 
listed in Section 209 subparagraph c. 
(7) Exercise such other powers and perform such other duties as 
may be prescribed by law or ordinance. 
Chapter 4 
Appointive Local Officials Common to All Provinces, 
Cities and Municipalities 
Article One. Secretary to the Sanggunian 
SEC. 161. Qualifications, Duties and Powers. - (a) There shall be a secretary 
tcr the sanggunian who shall have the rank of and salary equal to a head of department 
or office. 
(b) The Secretary to the sanggunian must be a citizen of the Philippines, a 
resident of the local government concerned, of good moral character, a 
holder of a college degree' preferably in law, commerce or public 
administration conferred by a recognized college or university, and a first 
grade civil service eligible or its equivalent. 
The appointment of a Secretary shall be mandatory for provincial, city and 
municipal governments. 
(c) The Secretary to the sanggunian shall take charge of the office and shall: 
(I) Attend meetings of the sanggunian and keep a journal of its proceedings; 
(2) Sign and affix the seal of the local government to all ordinances, 
resolutions, and other official acts of the sanggunian and present the same 
to the presiding officer for his signature; 
(3) Forward to the governor or mayor, as the case may be, for approval, 
copies of ordinances enacted by the sanggunian and duly certified by the 
presiding officer, 
(4) Forward to the sangguniang panlungsod or bayan concerned, in the case 
of the sangguniang barangay, and to the sangguniang panlalawigan 
concerned, in the case of the sangguniang panlungsod of component cities 
or sangguniang bayan, copies of duly approved ordinances, 
(5) Furnish, upon request of any interested party, certified copies of records 
of public character in his custody, upon payment to the treasurer of such fees 
as may be prescribed by ordinance; 


(6) Record all ordinances and resolutions enacted or adopted by the 
sanggunian in a book kept for the purpose, with the dates of passage and 
publication thereof; 
(7) Keep his office and all non-confidential records therein open to the public 
during the usual business hours; 
(8) Translate into the dialect used by the majority of the inhabitants all 
ordinances and resolutions immediately after their approval, and cause the 
publication of the same together with the original version in the manner 
provided under this Code; and 
(9) Take custody of the local archives and, where applicable, the local library 
and annually account for the same; and 
(e) Exercise such other powers and perform such other duties as may be 
prescribed by law or ordinance relative to his position. 
SEC. 162. Posting and Publication of Ordinances with Penal 
Sanctions. - (a) within ten (IO) days after approval on review, ordinances’with 
penal sanctions shall be posted at prominent places in the provincial capitol, city, 
municipal or barangay hall, as the case may be, for a minimum period of three 
(3) consecutive weeks. Such ordinances shall also be published in a newspaper 
of general circulation, where available, within the territorial jurisdiction of the local 
government concerned, except in the case of barangay ordinances. Unless 
otherwise provided therein, said ordinances shall take effect on the day following 
its publication, or at the end of the period of posting, whichever occurs later. 
Article Two. The Treasurer 
SEC. 163. Appointment, Qualifications, Duties, and Powers. - (a) The 
treasurer shall be appointed b) the Secretary of Finance from a list of at least 
three (3) ranking, eligible recommendees , of the governor or mayor, as the case 
may be, 
(b) The treasurer shall be under the administrative supervision of the governor 
or mayor, as the case may be, to whom he shall report regularly on the tax 
collection efforts in the local government; 
(c) The treasurer shall be a citizen of the Philippines, a resident of the local 
government concerned, of good moral character, a holder of a college degree 
preferably in commerce, public administration or law conferred by a 
recognized college or university, and a first grade civil service eligible or its 
equivalent. He must have acquired experience in treasury or accounting 
service for at least five (5) years in the case of the city or provincial treasurer, 


and three '(3) years in the case of the municipal treasurer. The appointment of 
a treasurer shall be mandatory for provincial, city and municipal governments. 
(d) The treasurer shall take charge oft he treasury office, perform the duties, 
and shall: 
(1) Advise the governor or mayor, as the case may be, the sanggunian, 
and other local government and national officials concerned regarding 
disposition of local government funds, and on such other matters relative 
to public finance; 
(2) Take custody of and exercise proper management of the funds of the 
local government concerned; 
(3) Take charge of the disbursement of all local government funds and 
such other funds the custody of which may be entrusted to him by law or 
other competent authority; 
(4) Inspect private commercial and industrial establishments within the 
jurisdiction of 
the local government concerned in relation to the 
implementation of tax ordinances, 
(5) Maintain and update the tax information system of the local 
govern men t ; 
(6) In the case of the provincial treasurer, exercise technical supervision 
over all treasury offices of component cities and municipalities; and 
(e) Exercise such other powers and perform such other duties as may be 
prescribed by law or ordinance. 
SEC. 164. Assistant Treasurer. - (a) An assistant treasurer shall be appointed 
by the Secretary of Finance from a list of at least three (3) ranking, eligible 
recommendees of the governor or mayor, 
(b) The assistant treasurer must be a citizen of the Philippines, a resident of 
the local government concerned, of good moral character, a holder of a 
college degree preferably 
in commerce, public administration, or law 
conferred by a recognized college or university, and a first grade civil 
service eligible or its equivalent. He must have acquired at least five (5) 
years experience in the treasury or accounting service in the case of the city 
or provincial assistant treasurer, and three (3) years in the case of the 
municipal assistant treasurer. 
The appointment of an assistant treasurer shall be optional for provincial, 
city and municipal governments. 
c) The assistant treasurer shall assist the treasurer and perform such duties 
as the latter may assign to him. He shall have authority to administer oaths 
. 


concerning notices and notifications to those delinquents in the payment of 
the real property tax and concerning official matters relating to the accounts 
of the treasurer or otherwise arising in the offices of the treasurer and the 
assessor. 
Article Three. The Assessor 
SEC. 165. Qualifications, Duties and Powers. - (a) The assessor must be a 
citizen of the Philippines, a resident of the local government concerned, of good moral 
character, a holder of a college degree preferably in civil or mechanical engineering, 
commerce, or any other related course conferred by a recognized cortege or university, 
and a first grade civil service eligible or its equivalent. He must have acquired 
experience in real property assessment work or in any related field for at least five (5) 
years in the case Of the city or provincial assessor, and three (3) years in the case of 
the municipal assessor. 
The appointment of assessor shall be mandatory for provincial, city and 
municipal governments. 
(b) The assessor shall take charge of the assessor's ofice, perform the duties 
(I) 
Ensure that all laws and policies governing the appraisal and assessment of 
(2) Initiate, review, and recommend changes in policies and objectives, plans and 
real properties for taxation purposes are properly executed; 
programs, techniques, procedures and practices in the valuation and 
assessment of real properties for taxation purposes; 
(3) Establish a systematic method of real property assessment; 
(4) Install and maintain a real property identification and accounting system, 
(5) Prepare, install and maintain a system of tax mapping, showing graphically all 
property subject to assessment and gather all data concerning the same; 
(6) Conduct frequent physical surveys to verify and determine whether all real 
properties within the locat government are properly listed in the assessment 
rolls; 
(7) Exercise the functions of appraisal and assessment primarily for taxation 
purposes of all real properties in the local government concerned; 
properties, in accordance with Chapter 2 of Titie Nine of this Code; 
(8) Prepare a schedule of the fair market value for the different classes of real 
(9) Issue, upon request of any interested party, certified copies of assessment 
records of real property and all other records relative to its assessment, 
upon payment of a service charge or fee to the treasurer; 
(1 0) Submit every semester a report of all assessments, as well as cancellations 


and modifications of assessments to the local chief executive and the 
sanggunian concerned; 
personally or through an authorized representative, all sessions of the local 
board of assessment appeals whenever his assessment is th- subject of the 
appeal, and present or submit any information or record in his possession 
as may be required by the board; and, (12) in the case of the provincial 
assessor, exercise technical supervision and visitorial functions over all 
component city and municipal assessors, coordinate with component city or 
municipal assessors in the conduct of tax mapping operations and all other 
assessment activities, and provide all forms of assistance therefor; and 
(1 I) 
In the case of the assessor of a component city or municipality attend, 
(d) Exercise such other powers and perform such other duties as may be prescribed 
by law or ordinance. 
SEC. 166. Assistant Assessor. - (a) The assistant assessor must be a citizen of 
the Philippines, a resident of the local government concerned, of good moral character, 
a holder of a college degree preferably in civil or mechanical engineering, commerce, or 
any related course conferred by a recognized college or university, and a first grade civil 
service eligible or its equivalent. He must have acquired experience in assessment or in 
any related field for at least three (3) years in the case of the city or provincial assistant 
assessor, and one (I) year in the case of the city or provincial assistant assessor. 
The appointment of an assistant assessor is optional for provincial, city and 
mun ici pa I govern men ts . 
(b) The assistant assessor shall assist the assessor and perform such other 
duties as the latter may assign to him. He shall have the authority to administer 
oaths on all declarations of real property for purposes of assessment. 
Article Four. The Accountant 
SEC. 167. Qualifications, Duties and Powers. - (a) The accountant must be a 
citizen of the Philippines, a resident of the local government concerned, of good moral 
character, and a certified public accountant. He must have acquired experience in the 
treasury or accounting service for at least five (5) years in the case of the provincial or 
city accountant, and three (3) years in the case of the municipal accountant. 
The appointment of accountant shall be mandatory for provincial, city and 
municipal governments. 


(b) The accountant shall take charge of both the accounting and internal audit 
services of the local government concerned and shall: 
(1) Install and maintain an internal audit system in the local government 
concerned ; 
(2) Prepare and submit financial statements to the governor or mayor, as the 
case may be, and to the sanggunian concerned; . 
(3) Apprise the sanggunian and other local government officials on the financial 
condition and operations of the local government concerned; 
(4) Certify to the availability of budgetary allotment to which expenditures and 
obligations may be properly charged; 
(5) Review supporting documents before preparation of vouchers to determine 
completeiless of requirements; 
(6) Prepare statements allowances, of cash advances, liquidation, salaries, 
reimbursements and remittances pertaining to the local government; 
(7) Prepare statements of journal vouchers and liquidation of the same and other 
(8) Post-individual disbursements to the subsidiary ledger and index cards; 
(9) Maintain individual ledgers for officials and employees of the local 
(IO) 
Record and post in index cards details of purchased furniture, fixtures, and 
(I 
1 ) Account for all issued requests for obligations and maintain and keep all 
(12) Prepare journals and the analysis of obligations and maintain and keep all 
(I 
3) Exercise such other powers and perform such other duties as may be 
adjustments related thereto; 
government pertaining to payrolls and deductions; 
equipment, including disposal thereof, if any; 
records and reports related thereto; 
records and reports related thereto; and 
provided by law or ordinance. 
(c) The incumbent chief accountant in the office of the treasurer shall be given 
preference in the appointment to the position of accountant. 
Article Five. The Budget Officer 
SEC. 168. Qualifications, Duties and Powers. - (a) The budget officer must be 
a citizen of the Philippines, a resident of the local government concerned, of good moral 
character, a holder of a college degree preferably in accounting, economics, public 
administration or any related course conferred by a recognized college or university, 
arid a first grade civil service eligible or its equivalent. He must have acquired 
experience in government budgeting or in any related field for at least five (5) years in 


the case of the provincial or city budget officer, and at least three (3) years in the case 
of the municipal budget officer. 
The appointment of a budget officer shall be mandatory for provincial, city and 
municipal governments. 
(b) The budget offker shall take charge of the budget ofice and shall: 
(I) Prepare forms, orders, and circulars embodying instructions on budgetary 
and appropriation matters for the signature of the governor or mayor, as the 
case may be; 
(2) Review and consolidate the budget proposals of different departments and 
offices of the local government; 
(3)Assist the governor or mayor, as the case may be, in the preparation of the 
(4)Study and evaluate budgetary implications of proposed legislation and 
budget and during budget hearings; 
submit codments and recommendations thereon; 
Budget and Management; 
(5) When so requested Submit periodic budgetary reports to the Department of 
(6) Coordinate with the treasurer, accountant, and the planning and development 
(7) Assist the sanggunian concerned in reviewing the approved budgets of 
(8) Coordinate with the planning and development coordinator in the formulation 
coordinator for the purpose of budgeting; 
component local governments; 
of the local government development plan; and 
(c) Exercise such other powers and perform such other duties as may be 
prescribed by law or ordinance. 
Article Six. The Planning and Development Coordinator 
SEC. 169. Qualifications, Duties and Powers.- (a) The planning and 
development coordinator must be a citizen of the Philippines, a resident of the local 
government concerned, of good moral character, a holder of a college degree 
preferably in urban planning, development studies, economics, public administration, or 
ariy related course conferred by a recognized college or university, and a first grade civil 
service eligible or its equivalent. He must have acquired experience in development 
planning or in any related field for at least five (5) years in the case of the provincial or 
city planning and development coordinator, and three (3) years in the case of the 
municipal planning and development coordinator. 
The appointment of a planning and development coordinator shall be mandatory 
for provincial, city and municipal governments. 


(b) The planning and developmefit coordinator shall t a b  charge of the planning and 
development office and shall: 
(I) 
Formulate integrated economk, social, physical, and other development 
plans and policies for consideration of the local government development 
cou nci I ; 
(2) Conduct con 
(3) Integrate and coordinate all sectoral plans and studies undertaken by the 
ng studies, researches, and training programs necessary to 
evolve plans 
programs for implementation; 
differeht functional groups or agencies; 
ate the implementation of the different development 
s, and activities in the local government concerned in 
accordance with the appwved development plan; 
(5) Prepare comprehensive pl 
8 and other development pbnning documents 
for the consideration of the l o ~ l  
development council; 
(6)Analyze the income and e enditure patterns, and formulates and 
recommends fiscal plans and pwcies for consideration 6f the finance 
committee of the local government; 
ple participation in devel0pmm.t. planning within the local 
government concerned; and 
development council; and 
. (8) Exercise supervision and control over the Secretariat of the local 
(c) Exercise such other powers and perform such other duties as may be 
prescribed by law or ordinance.\ 
Article Seven. The Engineer 
SEC. 170. Qualifications, Duties and Powers. - (a) The engineer must be a 
of the Philippines, a resident of the local government concerned, of good moral 
acter, and a licensed civil engineer. He must have acquired experience in the 
ctice of his profession for at least five (5) years in the case of the provincial or'city 
The appointment of engineer shall be mandatory for provincial, city and municipal 
gove&rnents. The city and municipal engineer shall also act as the local building official. 
engineer shall take charge of the engineering office and shall: 
(1) .@tiate, review and recommend changes in policies and objectives, plans and 
prkrams , techniques, procedures and practices in infrastructure 
devqbpment and public works in general of the local government concerned; 
~ 
eer, and three (3) years in the ease of the municipal engineer. 


(2) Advise the governor or mayor, as the case may be, on infrastructure, public 
works, and other engineering matters; 
(3) Administer, coordinate, supervise, and control the construction, maintenance, 
improvement, and repair of roads, bridges, and other engineering and public 
works projects of the local government concerned; 
investigation and survey, engineering designs, feasibility studies, and project 
ma nag e men t ; 
engineering offices of component cities and municipalities; and 
(4) Provide engineering services to the local government concerned, including 
(5) In the case of the provincial engineer, exercise technical supervision over all 
(c) Exercise such other powers and perform such other duties as may be 
prescribed by law or ordinance. 
Article Eight. The Health Officer 
SEC. 171. Qualifications, Duties and Powers. - (a) The health officer must be 
a citizen of the Philippines, a resident of the local government concerned, of good moral 
character, and a licensed medical practitioner. He must have acquired experience in the 
practice of his profession for at least five (5) years in the case of the provincial or city 
health officer, and three (3) years in the case ofthe municipal health officer. 
The appointment of a health officer shall be mandatory for provincial, city and 
mu n i ci pa I govern men ts. 
b) The health officer shall take charge of the office on health and shall: 
(1) Take charge of the office on health services, supervise the personnel and staff 
of said office, formulate program implementation guidelines and rules and 
regulations for the operation of the said office for the approval of the governor 
or mayor, as the case may be, in order to assist him in the efficient, effective 
and economical implementation of a health services program geared to 
implementation of health related projects and activities; 
(2)Formulate measures for the consideration of the sanggunian and provide 
technical assistance and support to the governor or mayor, as the case may be, 
in carrying out activities to enslrre the delivery of basic services and provision of 
adequate facilities relative to health services; 
(3) Develop plans and strategies and upon approval thereof by the governor or 
mayor as the case may be, implement the same, particularly those which 
have to do with health programs and projects 'which the governor or mayor, 
is empowered to implement and which the sanggunian is empowered to 
provide for under this Code; 


(4) In addition to the foregoing duties and functions, the health offcer shall: 
(i) Formulate and implement policies, plans, programs and projects to 
promote the health of the people in the locaf government concerned; 
(ii) Advise the governor or mayor, as the case may be, and the sanggunian 
(iii) Execute and enforce all laws, ordinances and regulations relating to 
(iv) Recommend to the sanggunian, through the local health board, the 
on matters pertaining to health; 
public health; 
enactment of such ordinances, as he may deem necessary for the 
preservation of public health; 
(v) Recommend the prosecution of any violation of sanitary laws, ordinances 
or regulations; 
(vi) Direct the sanitary inspection of all business establishments selling food 
items or providing accommodations such as hotels, motels, lodging 
houses, pension houses, and the like; 
(vii) Conduct health information campaigns and render health intelligence 
(viii) Coordinate with other government agencies and non-governmental 
services; 
organizations involved in the promotion and delivery of health services; 
and 
(ix) In the case of the provincial health officer, exercise general supervision 
over health officers of component cities and municipalities; and 
(5) Be in the frontline of health services delivery, particularly during and in the 
aftermath of man-made and natural disasters and calamities; and 
(c) Exercise such other powers and perform such other duties as may be prescribed 
by law or ordinance. 
Article Nine. The Civil Registrar 
SEC. 172. Qualifications, Duties and Powers. - (a) The civil registrar must be a 
cltlren sf the Phillppines, a resident of the local government concerned, of good moral 
character, a holder of a college degree conferred by a recognized college or university, 
arid a first grade civil service eligible or its equivalent. He must have acquired 
experience in civil registry work for at least five (5) years in the case of "the city civil 
registrar and three (3) years in the case of the municipal civil registrar. 


The appointment of a civil registrar shall be mandatory for provincial, city and 
municipal governments. 
(b) The civil registrar shall be responsible for the civil registration program in the local 
(c) The civil registrar shall take charge of the office of the civil registry and shall: 
government concerned, 
(I) 
Develop plans and strategies arid upon approval thereof by the governor or 
mayor, as the case may be, implement the same, particularly those which 
have to do with civil registry programs and projects which the mayor is 
empowered to implement and which the sanggunian is empowered to provide 
for under this Code; 
(2) In addition to the foregoing duties and functions, the civil registrar shall: 
(i) Accept all registrable documents and judicial decrees affecting the civil 
(ii) File, keep and preserve in a secure place the books required by law; 
(iii) Transcribe and enter immediately upon receipt all registrable documents 
status of persons; 
and judicial decrees affecting the civil status of persons in the appropriate 
civil registry books; 
(iv) Transmit to the Office of the Civil Registrar- General, within the 
prescribed period, duplicate copies of regjstered documents required by 
law; 
(v) Issue certified transcripts or copies of any certificate or registered 
documents upon payment of the prescribed fees to the treasurer; 
(vi) Receive applications for the issuance of a marriage license and, after 
determining that the requirements and supporting certificates and 
publication thereof for the prescribed period have been complied with, 
issue the license upon payment of the authorized fee to the treasurer; 
(vii) Coordinate with the National Statistics Office in conducting educational 
campaign for vital registration and assist in the preparation of 
demographic and other statistics for the local government concerned; 
and 
(3) Exercise such other powers and perform such other duties as may be 
prescribed by law or ordinance. 
Article Ten. The Administrator 
SEC. 973. Qualifications, Terms, Duties and Powers. - (a) The administrator 
must be a citizen of the Philippines, a resident of the local government concerned, of 
good moral character, a holder of a college degree preferably in public administration, 
. 


law, or any other related course a recognized college or university, and a first grade civil 
service eligible or its equivalent. He must have acquired experience in management and 
administration work for at least five (5) years in the case of the provincial or city 
administrator, and three (3) years in the case of the municipal administrator. 
The appointment of the administrator shall be mandatory for the provincial and 
The term of administrator is coterminous with that of the appointing authority. 
(b) The administrator shall take charge of the office of the administrator and shall: 
(I) 
Develop plans and strategies and upon approval thereof by the governor or 
mayor, as the case may be, implement the same particularly those which 
have to do with the management and administration-related programs and 
projects which the governor or mayor is empowered to implement and which 
the sanggunian is empowered to provide for under this Code; 
(2) In addition to the foregoing duties and functions, the administrator shall: 
(i) Assist in the coordination of the work of all the officials of the local 
city governments and optional for the municipal government. 
government, under the supervision, direction and control of the governor 
or mayor, and for this purpose, he may convene the chiefs of offices and 
other officials of the local government; 
(ii) Establish and maintain a sound personnel program for the local 
government designed to promote career development and uphold the 
merit principle in the local government service; 
(iii) Conduct a continuing organizational development of the local government 
with the end in view of instituting effective administrative reforms; 
(3)Be in the frontline of the delivery of administrative support services, 
particularly those related to the situations during and in the aftermath 
of man- ade and natural disasters and calamities; 
(4)Recommend to the sanggunian and advise the governor and mayor, as the 
case may be, on all other matters relative to the management and 
administration of the local government; and 
(4) Exercise such other powers and perform such other duties as may be 
prescribed by law or ordinance. 
Article Eleven. The Legal Officer 
SEC. 174. Qualifications, Terms, Duties and Powers. - (a) The legal officer 
must be a citizen of the Philippines, a resident of the local government concerned, of 
good moral character, and a member of the Philippine Bar. He must have practiced his 
profession for at least five (5) years in the case of the provincial and city legal ofFicer, 


and three (3) years in the case of the municipal legal officer. The term of the legal officer 
shall be coterminous with that of his appointing authority. 
The appointment of the legal officer 
shall be mandatory for provincial and city 
governments and optional for the municipal government. 
(b) The legal officer, as the chief legal counsel of the local government, shall take 
charge of the office of legal services and shall: 
(I) Formulate measures for the consideration of the sanggunian and provide legal 
assistance and support to the governor or mayor, as the case may be, in 
carrying out his duties and functions. 
(2) Develop plans and strategies and upon approval thereof by the governor or 
mayor, as the case may be, implement the same, particularly those which 
have to do with programs and projects related to legal services which the 
governor or mayor is empowered to implement and which the sanggunian is 
empowered to provide 
(3) In addition to the foregoing duties and functions, the legal officer shall: 
(i) Represent the local government in all civil actions and special proceedings 
wherein the local government or any official thereof, in his official capacity, 
is a party: Provided, That, in actions or proceedings where a component 
city or municipality is a party adverse to the provincial government or to 
another component city or municipality, a special legal officer may be 
employed to represent the adverse party; 
(ii) When required by the governor, mayor or sanggunian, draft ordinances, 
contracts, bonds, I-ases and other instruments, involving any interest of the 
local government; and provide comments and recommendations on any 
instruments already drawn; 
by "the governor, mayor, or sanggunian; 
administrative neglect or misconduct in office, and recommend appropriate 
action to the governor, mayor or sanggunian, as the case may be; 
(v) Investigate or cause to be investigated any person, firm or corporation holding 
(iii) Render his opinion in writing on any question of law when requested to do so 
(iv) Investigate or cause to be investigated any local official or employee for 
any franchise or exercising any public privilege for failure to comply with any 
term or condition in the grant of such franchise or privilege, and 
recommending appropriate action to the governor, mayor or sanggunian, as 
the case may be; 


(vi) When directed by the governor, mayor, or sanggunian, initiate and prosecute 
in the interest of the local government concerned any civil action on any 
bond, lease or other contract upon any breach or violation thereof; and 
(vii)Review and submit recommendations on ordinances approved and executive 
(3) Recommend measures to the sanggunian and advise the governor or mayor 
as the case may be on all other matters related to upholding the rule of law; 
(4) Be in the frontline of protecting human rights and prosecuting any violations 
thereof, particularly those which occur during and in the aftermath of man- 
made or natural disasters or calamities; and 
orders issued by component units; 
(5) Exercise such other powers and perform such other duties as may be 
prescribed by law or ordinance. 
Article Twelve. The Agriculturist 
SEC. 175. Qualifications, Duties and Powers. - (a) The agriculturist must be a 
citizen of the Philippines, a resident of the local government concerned, of good moral 
character, a holder of a college degree in agriculture or any related course conferred by 
a recognized college or university, and a first grade civil service eligible or its equivalent. 
He must have practiced his profession in agriculture or acquired experience in a related 
field for at least five (5) years in the case of the provincial and city agriculturist, and 
three (3) years in the case of the municipal agriculturist. 
The appointment of agriculturist shall be mandatory for provincial, and optional 
for the city and municipal governments. 
(b) The agriculturist shall take charge of the ofice for agricultural services, and 
Formulate measures for the approval of the sanggunian and provide 
technical assistance and support to the governor or mayor, as the case 
may be, in carrying out said measures to ensure the delivery of basic 
shall: 
(I) 
services and provision of adequate facilities relative to agricultural 
services 
(2) Develop plans and strategies and upon approval thereof by the governor 
or mayor, as the case may be, implement the same, particularly those which 
have to do with agricultural programs and projects which the governor or 
mayor is empowered to implement and which the sanggunian is empowered 
to provide 
(3) In addition to the foregoing duties and functions, the agriculturist shall: 
(i) 
Ensure that maximum assistance and access to resources in the 


production, processing and marketing of agricultural and aqua-cultural 
and marine products are extended to farmers, fishermen and local 
entrepreneurs; 
(ii) 
Conduct or cause to be conducted location-specific agricultural 
researches and assist in making available the appropriate technology 
arising out of and disseminating information on basic research on 
crops, preventive and control of plant diseases and pests, and other 
agricultural matters which will maximize productivity; 
Assist the governor or mayor, as the case may be, in the establishment 
and extension services of demonstration farms or aquaculture and 
marine products; 
Enforce rules and regulations relating to agriculture and aquaculture; 
(iii) 
(iv) 
(v) 
Coordinate with 
government agencies 
and 
non-governmental 
organizations , which 
promote ag ri cu I tu ral productivity t h rough 
appropriate technology compatible with environmental integrity; 
(4) Be in the frontline of delivery of basic agricultural services, particularly those 
needed for the survival of the inhabitants during and in the aftermath of man- 
made and natural disasters; 
(5) Recommend to the sanggunian and advise the governor or mayor, as the 
case may be, on all other matters related to agriculture and aqua-culture 
which will improve the livelihood and living conditions of the inhabitants; and 
(c) Exercise such other powers and perform such other duties as may be prescribed 
by law or ordinance. 
Article Thirteen. The Social Welfare and Development Officer 
SEC. 176. Qualifications, Duties and Powers. - (a) The social welfare and 
development officer must be a citizen of the Philippines, a resident of the local 
government concerned, of good moral character, a duly licensed social worker or a 
holder of a college degree preferably in sociology or any other related course conferred 
by a recognized college or university, and a first grade civil service eligible or its 
equivalent. He must have acquired experience in the practice of social work for at least 
five (5) years in the case of the provincial or city social welfare and development officer, 
arid three (3) years in the case of the municipal social welfare and development officer. 
The appointment of a social welfare and development officer shall be mandatory 
for provincial and city governments and optional for municipal governments. 
(b) The social welfare and development officer shall take charge of the office on 
social welfare and development services and shall: 


(I) Formulate measures for the approval of the sanggunian and provide 
technical assistance and support to the governor or mayor, as the case 
may be, in carrying out measures to ensure the delivery of basic services 
and provision of adequate facilities relative to social welfare and 
development services 
Develop plans and strategies and upon approval thereof by the governor 
or mayor, as the case may be, implement the same particularly those 
which have to do with social welfare programs and projects which the 
governor or mayor is empowered to implement and which the sanggunian 
is empowered to provide 
In addition to the foregoing duties, the social welfare and development 
om ce r s h al I : 
(2) 
(3) 
Identify the basic needs of the needy, the disadvantaged and the 
impoverished and develop and implement appropriate measures to 
alleviate their problems and improve their living conditions; 
Provide relief and appropriate crisis intervention for victims of 
abuse and exploitation and recommend appropriate measures to 
deter further abuse and exploitation; 
Assist the governor or mayor, as the case may be, in implementing 
the barangay level program for the total development and 
protection of children up to six (6) years of age; 
Facilitate the implementation of welfare programs for the disabled, 
elderly, and victims of drug addiction, the rehabilitation of prisoners 
and parolees, the prevention of juvenile delinquency and such other 
activities which would eliminate or minimize the ill-effects of 
poverty; 
Initiate and support youth welfare programs that will enhance the 
role of the youth in nation-building; 
Coordinate with government agencies and non- governmental 
organizations which have for their purpose the promotion and the 
protection of all needy, disadvantaged, underprivileged or 
impoverished groups or individuals, particularly those identified to 
be vulnerable and high-risk to exploitation, abuse and neglect; 
(4) 
Be in the frontline of service delivery, particularly those that have to do 
with immediate relief during and assistance in the aftermath of man-made 
and natural disaster and natural calamities; 
Recommend to the sanggunian and advise the governor or mayor, as the 
case may be, on all other matters related to social welfare and 
(5) 


development services which will improve the livelihood and living 
conditions of the inhabitants; and 
(c) Exercise such other powers and perform such other duties as may be prescribed 
by law or ordinance. 
Article Fourteen. The Environment and Natural Resources Officer 
SEC. 177. Qualifications, Duties and Powers. - (a) The environment and 
natural resources officer must be a citizen of the Philippines, a resident of the local 
government concerned, of good moral character, a holder of a college degree 
preferably in environment, forestry, agriculture or any related course conferred by a 
recognized college or university, and a first grade civil service eligible or its equivalent. 
He must have acquired experience in environmental and natural resources 
management, conservation, and utilization, of at least five (5) years in the case of the 
provincial or city environment and natural resources officer, and three (3) years in the 
case of the municipal environment and natural resources officer. 
The appointment of an environment and natural resources officer is optional for 
(b) The environment and natural resources management officer shall take charge of 
Formulate measures for the consideration of the sanggunian and provide 
technical assistance and support to the governor or mayor, as the case 
may be, in carrying out measures to ensure the delivery of basic services 
and provision of adequate facilities relative to environment and natural 
resources services 
Develop plans and strategies and upon approval thereof by the governor 
or mayor, as the case may be, implement the same, particularly those 
which have to do with environment and natural resources programs and 
projects which the governor or mayor is empowered to implement and 
which the sanggunian is empowered to provide 
In addition to the foregoing duties and powers, the environment and 
natural resources officer shall: 
(i) 
Establish, maintain, protect and preserve communal forests, 
watersheds, tree parks, mangroves, greenbelts and similar forest 
projects and commercial forest, like industrial tree farms and agro- 
forestry projects; 
provincial, city and municipal governments. 
the office on environment and natural resources and shall: 
(I) 
(2) 
(3) 
(ii) 
Provide extension services to beneficiaries of forest development 
projects and technical, financial and infrastructure assistance; 


(iii) 
Manage and maintain seed banks and produce seedlings for 
forests and tree parks; 
Provide exfension services to beneficiaries of forest development 
projects and render assistance for natural resources-related 
conservation and utilization activities consistent with ecological 
balance; 
Promote the small-scale mining and utilization of mineral resources, 
particularly mining of gold; 
Coordinate with government agencies and non- governmental 
organizations in the implementation of measures to prevent and 
control land, air and water pollution; 
Be in the frontline of the delivery of services concerning the environment 
and natural resources, particularly in the renewal and rehabilitation of the 
environment during and in the aftermath of man-made and natural 
calamities and disasters; 
Recommend to the sanggunian and advise the governor or mayor, as the 
case may be, on all matters relative to the protection, conservation, 
maximum utilization, application of appropriate technology and other 
matters related to the environment and natural resources; and 
(c) Exercise such other powers and perform such other duties as may be prescribed 
(iv) 
(v) 
(vi) 
(4) 
(5) 
by law or ordinance. 
Article Fifteen. The Architect 
SEC. 178. Qualifications, Duties and Powers. - (a) The architect a citizen of 
the Philippines, a resident of the local government concerned, of good moral character, 
a duly licensed architect. He must have practiced his profession for at least five (5) 
years in the case of the provincial or city architect, and three (3) years in the case of the 
municipal architect. 
The appointinent of an architect is optional for provincial, city and municipal 
govern me nts . 
(b) The architect shall take charge of the office on architectural planning and design 
and shall: 


(I) Formulate measures for the consideration of the sanggunian and provide 
technical assistance and support to the governor or mayor, as the case 
may be, in carrying out measures to ensure the delivery of basic services 
and provision of adequate facilities relative to architectural planning and 
design 
Develop plans and strategies and upon approval thereof by the governor 
or mayor, as the case may be, implement the same, particularly those 
which have to do with architectural planning and design programs and 
projects which the governor or mayor is empowered to implement and 
which the sanggunian is empowered to provide 
In addition to foregoing duties and functions, the architect shall: 
(i) 
(2) 
(3) 
Prepare and recommend for consideration of the sanggunian the 
architectural plan and design for the locaf government or a part 
thereof, including the renewal of slums and blighted areas, land 
reclamation activities, the greening of land, and appropriate 
planning of marine and foreshore areas; 
Review and recommend for appropriate action of the sanggunian, 
governor or mayor, as the case may be, the architectural plans and 
design submitted by governmental and non-governmental entities 
or individuals, particularly those for undeveloped, underdeveloped, 
and poorly-designed areas; and 
(iii) 
Coordinate with government and non-government entities and 
individuals involved in the aesthetics and the maximum utilization of 
the land and water within the jurisdiction of the local government, 
compatible with environmental integrity and ecological balance. 
(ii) 
(4) 
Be in the frontline of the delivery of services involving architectural 
planning and design, particularly those related to the redesigning of spatial distribution 
of basic facilities and physical structures during and in the aftermath of man-made and 
natural calamities and disasters; 
(5) 
Recommend to the sanggunian and advise the governor or mayor, as the 
case may be, on all other matters relative to the architectural planning and 
design as it relates to the total socioeconomic development of the local 
government; and 
(c) Exercise such other powers and perform such other duties as may be prescribed 
by law or ordinance. 


Article Sixteen. The Information Officer 
SECTION 179. Qualifications, Duties and Powers. - (a) The information officer 
must be a citizen of the Philippines, a resident of the local government concerned, of 
good moral character, a holder of a college degree preferably in journalism, mass 
coinmunication or any related course conferred by a recognized college or university, 
and a first grade civil service eligible or its equivalent. He must have experience in 
writing articles and research papers, or in writing for print, television or broadcast media 
of at least three (3) years in the case of the provincial or city information officer, and at 
least one (I) 
year in the case of municipal information officer. 
municipal governments. 
The appointment of an information officer is optional for provincial, city and 
The term of the information officer is co-terminous with that of the appointing 
authority . 
shall: 
(b) The information officer 
shall take charge of the office on public information and 
Formulate measures for the consideration of the sanggunian and provide 
(1) 
technical assistance and support to the governor or mayor, as the case 
may be, in providing the information and research data required for the 
delivery of basic services and provision of adequate facilities so that the 
public becomes aware of said services and may fully avail of the same; 
Develop plans and strategies and, upon approval thereof by the governor 
or mayor, as the case may be, implement the same, particularly those 
which have to do with public information and research data to support 
programs and projects which the governor or mayor is empowered to 
implement and which the sanggunian is empowered to provide. 
In addition to the foregoing duties and functions, the information officer 
shall: 
(i) 
Provide relevant, adequate, and timely information to the local 
government and its residents; 
(ii) 
Furnish information and data on local governments to government 
agencies or offices as may be required by law or ordinance; and non- 
governmental organizations to be furnished to said agencies and 
organizations; 
(2) 
(3) 


(iii) 
Maintain effective liaison with the various sectors of the community on 
matters and issues that affect the livelihood and the quality of life of the 
inhabitants and encourage support for programs of the local and 
national govern men t; 
(4) 
Be in the frontline in providing information during and in the aftermath of 
manmade and natural calamities and disasters, with special attention to 
the victims thereof, to help minimize injuries and casualties during and 
after the emergency, and to accelerate relief and rehabilitation; 
Recommend to the sanggunian and advise the governor or mayor, as the 
case may be, on all other matters relative to public information and 
research data as it relates to the total socioeconomic development of the 
local government; and 
(5) 
(c) Exercise such other powers and perform such other duties as may be prescribed 
by law or ordinance. 
.Article Seventeen. The Cooperatives Officer 
SECTION 180. Qualifications, Duties and Powers. - (a) The cooperative officer 
must be a citizen of the Philippines, a resident of the local government concerned, of 
good moral character, a holder of a college degree preferably in business administration 
with special training in cooperatives or any related course conferred by a recognized 
college or university, and a first grade civil service eligible or its equivalent. He must 
have experience in cooperatives organization and management of at least five (5) years 
in the case of the provincial or city cooperatives officer, and three (3) years in the case 
of municipal cooperatives officer. 
The appointment of the cooperatives officer is optional for the provincial and city 
b) The cooperatives officer shall take charge of the office for the development of 
cooperatives and shall: 
(I) Formulate measures for the consideration of the sanggunian, and provide 
technical assistance and support to the governor or mayor, as the case 
may be, in carrying out measures to ensure the delivery of basic services 
and provision of facilities through the development of cooperatives, and in 
providing access to such services and facilities; 
Develop plans and strategies and, upon approval thereof by the governor 
or mayor, as the case may be, implement the same, particularly those 
which have to do with the integration of cooperatives principles and 
methods in programs and projects which the governor or mayor is 
g overn men ts . 
(2) 


empowered to irnpliement and which the sanggunian is empowered lo 
provide 
In addition to the foregoing duties and powers, the cooperatives officer 
shall: 
(i) 
(ii) 
Provide technical and other forms of assistance to existing 
cooperatives to enhance their viability as an economic enterprise 
and social organization; 
Assist in the organization of cooperatives; 
(iii) 
Assist cooperatives in establishing linkages with government 
agencies and non-government organizations involved in the 
promotion and integration of the concept of cooperatives in the 
livelihood of the people and other community activities; 
Be in the frontline of cooperatives organization, rehabilitation or viability 
enhancement, particularly during and in the aftermath of man-made and 
natural calamities and disasters, to aid in their survival and, if necessary 
subsequent rehabilitation; 
Recommend to the sanggunian, and advise the governor or mayor, as the 
case may be, on all other matters relative to cooperatives development 
and viability enhancement which will improve the livelihood and quality of 
life of the inhabitants; and 
(c) Exercise such other powers and perform such other duties as may be prescribed 
by law or ordinance. 
Article Eighteen. The Population Officer 
N 181. Qualifications, Duties and owers. - (a) The population officer 
must be a citizen of the Philippines, a resident of the local government concerned, of 
good moral character, a holder of a college degree with specialized training in 
population development conferred by a recognized college or university, and a first 
grade civil service eligible or its equivalent. He must have experience in the 
implementation of programs on population development or responsible parenthood for 
at least five (5) years in the case of the provincial or city population officer and three (3) 
years in the case of the municipal population officer. 
The appointment of the population officer is optional in the local governments: 
Provided, however, that provinces and cities which have existing population offices shall 
continue to maintain such offices for a period of five (5) years from date of effectivity of 
this Code, after which said offices shall become optional. 
(b) The population officer shall take charge of the office on population development 


and shall: 
(I) Formulate measures for the consideration of the sanggunian and provide 
technical assistance and support to the governor or mayor, as the case 
may be, in carrying out measures to ensure the delivery of basic services 
and provision of adequate facilities relative to the integration of the 
population development principles and in providing access to said 
services and facilities; 
Develop plans and strategies and upon approval thereof by the governor 
or mayor, as the case may be, implement the same, particularly those 
which have to do with the integration of population development principles 
and methods in programs and projects which the governor or mayor is 
empowered to implement and which the sanggunian is empowered to 
provide for under this Code; 
In addition to the foregoing duties and powers, the population officer shall: 
(i) 
Assist the governor or mayor, as the case may be, in the 
implementation of the Constitutional provisions relative to 
population development and the promotion of responsible 
parenthood; 
(2) 
(3) 
(ii) 
Establish and maintain an updated data bank for program 
operations, development planning and an educational program to 
ensure the people's participation in and understanding of population 
development; 
Implement appropriate training programs responsive to the cultural 
heritage of the inhabitants; and 
(iii) 
(c) Exercise such other powers and perform such other duties as may be prescribed 
by law or ordinance. 
Article Nineteen. The Veterinarian 
SEC. 182. Qualifications, Duties and Powers. - (a) The veterinarian must be a 
citizen of the Philippines, a resident of the local government concerned, of good moral 
character, a licensed doctor of veterinary medicine. He must have practiced his 
profession for at least three (3) years in the case of provincial or city veterinarian and at 
least one (I) 
year in the case of the municipal veterinarian. 
The appointment of the veterinarian officer is mandatory for the provincial and 
city govern men ts. 
(b) The veterinarian shall take charge of the office for veterinary services and shall: 
(1) 
Formulate measures for the consideration of the sanggunian, and provide 


technical assistance and support to the governor or mayor, as the case 
may be, in carrying out measures to ensure the delivery of basic services. 
Develop plans and strategies and upon approval thereof by the governor 
or mayor, as the case may be, implement the same, particularly those 
which have to do with the veterinary-related activities which the governor 
or mayor is empowered to implement and which the sanggunian is 
empowered to provide for under this Code; 
In addition to the foregoing duties and powers, the veterinarian shall: 
(i) 
(2) 
(3) 
Advise the governor or the mayor, as the case may be, on all 
matters pertaining to the slaughter of animals for human 
consumption and the regulation of slaughterhouses; 
Regulate enforce laws or ordinance relative to the keeping of 
domestic animals; including the inspection of 
Poultry, milk and dairy products for public consumption; 
Enforce all laws and regulations for the prevention of cruelty to 
animals; and 
Take the necessary measures to eradicate, prevent or cure all 
forms of animal diseases; 
(ii) 
(iii) 
(iv) 
(v) 
(4) 
Be in the frontline of veterinary related activities, such as in the outbreak 
of highly contagious and deadly diseases, and in situations resulting in the 
depletion of animals for work and human consumption, particularly those 
arising from and in the aftermath of man-made and natural calamities and 
disasters; 
Recommend to the sanggunian and advise the governor or mayor, as the 
case may be, on all other matters relative to veterinary services which will 
increase the number and improve the quality of livestock, poultry and 
other domestic animals used for work or human consumption; and 
(5) 
(c) Exercise such other powers and perform such other duties as may be prescribed 
by law or ordinance. 
Article Twenty. The 
ervices Officer 
SECTIQN 183. Qualifications, Duties and owers. - (a) The general services 
officer must be a citizen of the Philippines, a resident of the local government 
concerned, of good moral character, a holder of a college degree on public 
administration, business administration and management conferred by a recognized 
college or university, and a first grade civil service eligible or its equivalent. He must 
have acquired experience in general services, including management of supply, 


property, solid waste disposal, and general sanitation, of at least five (5) years in the 
case of the provincial or city general services officer, and at least three (3) years in the 
case of the municipal general services officer. 
The appointment of the general services officer shall be mandatory for the 
provincial and city governments. 
(b) The general services officer shall take charge of the office on general services 
and shall: 
Formulate measures for the consideration of the sanggunian and provide 
technical assistance and support to the governor or mayor, as the case 
may be, in carrying out measures to ensure the delivery of basic services 
and provision of adequate facilities which require general services 
expertise and technical support services; 
Develop plans and strategies and upon approval thereof by the governor 
or mayor, as the case may be, implement the same, particularly those 
which have to do with the general services supportive of the welfare of the 
inhabitants which the governor or mayor is empowered to implement and 
which the sanggunian is empowered to provide for under this Code; 
In addition to the foregoing duties and powers, the general services officer 
shall: 
(i) 
Take custody of and be accountable for all properties, real or 
personal, owned by the local government and those granted to it in 
the form of donation, reparation, assistance and counterpart of joint 
projects; 
With the approval of the governor or mayor, as the case may be, 
assign building or land space to local officials or other public 
officials, who by law, are entitled to such space; 
Recommend to the governor or mayor, as the case may be, the 
reasonable rental rates for local government properties, whether 
real or personal, which will be leased to public or private entities by 
the local government; 
(ii) 
(iii) 
(iv) 
Recommend to the governor or mayor, as the case may be, 
reasonable rental rates of private properties, which may be leased 
for the official use of the local government; 
(iv) 
Maintain and supervise janitorial, Security, landscaping and other 
related services in all local government public buildings and other real 
property, whether owned or leased by the local government; 


(vi) 
(vii) 
(viii) 
Collate and disseminate inforination regarding prices, shipping and 
other costs of supplies and other items commonly used by the local 
government; 
Perform archival and record management with respect to records of 
offices and departments of the local government; and 
Perform all other functions pertaining to supply and property 
management heretofore performed by the local government 
treasurer; and enforce policies on records creation, maintenance, 
‘and disposal; 
(4) 
Be in the frontline of general services related activities, such as the 
possible or imminent destruction or damage to records, supplies, 
properties, and structures and the orderly and sanitary clearing up of 
waste materials or debris, particularly during and in the aftermath of man- 
made and natural calamities and disasters; 
Recommend to the sanggunian and advise the governor or mayor, as the 
case may be, on all other matters relative to general services; and 
(5) 
(c) Exercise such other powers and perform such other duties as may be prescribed 
by law or ordinance. 
Chapter 5 
Human Resources and Development 
SECTION 184. Organizational tructure and Staffing Pattern. - Every local 
government shall design and implement its own organizational structure and staffing 
pattern taking into consideration its service requirements and financial capability, 
subject to the minimum standards and guidelines prescribed by the Civil Service 
Commission. 
SECTION 185. Responsibility for Human Resources and Development. - The 
chief executive of every local government shall be responsible for human resources and 
development in his unit and shall take all personnel actions in accordance with the 
Constitutional provisions on civil service, pertinent laws, and rules and regulations 
thereon, including such policies, guidelines and standards as the Civil Service 
Commission may establish: Provided, That the local chief executive may employ 
emergency or casual employees or laborers paid on a daily wage or piecework basis 
and hired through job orders for local projects authorized by the sanggunian concerned, 


without need of approval or attestation by the Civil Service Commission: Provided, 
further, That the period of employment of emergency or casual laborers as provided in' 
this Section shall not exceed six (6) months. 
enrice Law, 
e ~ u l a t i o ~ ~ ,  
and Other Related 
Issuances. - The civil service law and such rules shall govern all matters pertinent to 
human resources and development in local governments and regulations and other 
issuances promulgated pursuant thereto, unless otherwise specified in this Code. 
SEC. 187'. Limitation on Appointments. - No person shall be appointed in the 
career service of the local government if he is related within the fourth civil degree of 
consanguinity or affinity to the appointing or recommending authority. 
SEC. 188. Public Notice of Vacancy; Personnel Sellectisn Board. - (a) 
Whenever a local chief executive decides to fill a vacant career position, there shall be 
posted notices of the vacancy in at least three (3) conspicuous public places in the local 
government concerned for a period of not less than fifteen (j5) days. 
(b) There shall be established in every province, city or municipality a personnel 
selection board to assist the local chief executive in the judicious and objective 
selection of personnel for employment as well as for promotion, and in She 
formulation of such policies as would contribute to employee welfare. 
(c) The local chief executive shall head the personnel selection board, and its 
members shall be determined by resolution of the sanggunian concerned. A 
representative of the Civil Service Commission, if any, and the personnel officer 
of the local government concerned shall be ex-officio members of the board. 
SEC. 189. Resignation of Elective Local Officials. - (a) Resignations by 
elective local officials shall be deemed effective only upon acceptance by the following 
authorities: 
(1) 
The President, in the case of governors; vice- governors, and mayors and 
vice-mayors of highly urbanized cities and independent component cities; 
The governor, in the case of municipal mayors, municipal vice-mayors, 
city mayors and city vice-mayors of component cities; 
The sanggunian concerned, in the case of sanggunian members; and 
The city or municipal mayor, in the case of barangay officials. 
(2) 
(3) 
(4) 
(b) Copies of the resignation letters of elective tocal officials, together with the action 
taken by the aforesaid authorities, shall be furnished the Department of Interior 
and Local Government. 


(c) The resignation shall be deemed accepted if not acted upon by the authority 
concerned within fifteen (15) working days from receipt thereof. 
(d) Irrevocable resignations by sanggunian members shall be deemed accepted 
upon presentation,before an open session of the sanggunian concerned and duly 
entered in its records: Provided, however, That this subsection does not apply to 
sanggunian members who are subject to recall elections or to cases where 
existing laws prescribe the manner of acting upon such resignations. 
SEC. 190. Grievance Procedure. - In every local government, the local chief 
executive shall establish a procedure to inquire into, act upon, resolve or settle 
complaints and grievances presented by local government employees. 
SEX. 'I 91. Administrative Discipline. - investigation and adjudication of 
administrative complaints against appointive local officials and employees as well as 
their suspension and removal shall be in accordance with the civil service law and rules 
and other pertinent laws. The results of such administrative investigations shall be 
reported to the Civil Service Commission. 
SEC. 
92. Preventive Suspension of Appointive Local Officials and 
Employees. - (a) The local chief executives may preventively suspend for a period not 
exceeding sixty (60) days any subordinate official or employee under his authority 
pending investigation if the charge against such official or employee involves 
dishonesty, oppression or grave misconduct or neglect in the performance of duty, or if 
there is reason to believe that the respondent is guilty of the charges which would 
warrant his removal from the service. 
(b) Upon expiration of the preventive suspension, the suspended official or 
employee shall be automatically reinstated in office without prejudice to the 
continuation of the administrative proceedings against him until its termination. If 
the delay in the proceedings of the case is due to the fault, neglect or request of 
the respondent, the time of the delay shall not be counted in computing the 
period of suspension herein provided. 
SEC. 193. Admini trative Investigation. - In any local government, 
administrative investigation may be conducted by a person or a committee duly 
authorized by the local chief executive. Said person or committee shall conduct 
hearings on the cases brought against appointive local officials and employees and 
submit their findings and recommendations to the local chief executive concerned within 
fifteen (I 
5) days from the conclusion of the hearings. The administrative cases herein 


mentioned shall be decided within ninety (90) days from the time the respondent is 
formally notified of the charges. 
SEC. 194. Disciplinary ~
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- Except as otherwise provided by law, the 
local chief executive may impose the penalty of removal from service, demotion in rank, 
suspension for not more than one (I) 
year without pay, fine in an amount not exceeding 
six (6) months' salary, or reprimand and otherwise discipline subordinate officials and 
employees under his jurisdiction. If the penalty imposed is suspension without pay for 
not more than thirty (30) days, his decision shall be final. If the penalty imposed is 
heavier than suspension of thirty (30) days, the decision shall be appealable to the Civil 
Service Commission, which shall decide the appeal within thirty (30) days from receipt 
thereof. 
SEC. 195. Execution Pending Appeal. - An appeal shall not prevent the 
execution of a decision of removal or suspension of a respondent-appellant. In case the 
respondent-appellant is exonerated, he shall be reinstated to his position with all the 
rights and privileges appurtenant thereto from the time he had been deprived thereof. 
SEC. 196. Prohibited Business and Pecuniary Interest. - (a) It shall be 
unlawful for any local government official or employee, directly or indirectly, to: 
Engage in any business transaction with the local government in which he 
is an official or employee or over which he has the power of supervision, 
or with any of its authorized boards, officials, agents, or attorneys, 
whereby money is to be paid, or property or any other thing of value is to 
be transferred, directly or indirectly, out of the resources of the local 
government to such person or firm; 
Hold such interests in any cockpit or other games licensed by a local 
government; 
Purchase any real estate or other property forfeited in favor of such local 
government for unpaid taxes or assessment, or by virtue of a legal 
process at the instance of the said local government; 
Be a surety for any person contracting or doing business with the local 
government for which a surety is required; and 
Possess or use any public property of the local government for private 
purposes. 
(b) All other prohibitions governing the conduct of national public officers relating to 
prohibited business and pecuniary interest so provided for under Republic Act 
Numbered Sixty-Seven Thirteen (R. A. No. 6713) otherwise known as the "Code 


of Conduct and Ethical Standards for Public Officials and Employees” and other 
laws shall also be applicable to local government officials and employees. 
7. Practice of ~ r ~ f ~ § ~ ~ o f l ~  
- (a) All governors, city and municipal mayors 
are prohibited from practicing their profession or engaging in any occupation other than 
the exercise of their duties and responsibilities as local chief executives. 
(b) Sanggunian members may practice their professions, engage in any occupation, 
or teach in schools except during session hours: Provided, That sanggunian 
members who are also members of the Bar shall not: 
Appear as counsel before any court in any civil case wherein a local 
government or any office, agency, or instrumentality of the government is 
the adverse party; 
Appear as counsef in any criminal case wherein an officer or employee of 
the national or local government is accused of an offense committed in 
relation to his office; 
Collect any fee for their appearance in administrative proceedings 
involving the local government of which he is an official; and 
Use property and personnel of the government except when the 
sanggunian member concerned is defending the interest of the 
government. 
(c) Doctors of medicine may practice their profession even during official hours of 
work only on occasions of emergency: Provided, that the officials concerned do 
not derive monetary compensation there from. 
SEC.198. Statement of Assets and Liabilities. - (a) Officials and employees of 
local governments shall file sworn statements of asset, liabilities and networth, lists of 
relatives within the fourth civil degree of consanguinity or affinity in government service, 
financial and business interests, and personnel data sheets as required by law. 
, Bath of Office. - (a) All elective and appointive local officials and 
employees shall, upon assumption to office, subscribe to an oath or affirmation of office 
in the prescribed form. The oath or affirmation of office shall be filed with the office of 
the local chief executive concerned. A copy of the oath or affirmation of office of all 
elective and appointive local officials and employees shall be preserved in the individual 
personal records file under the custody of the personnel office, division, or section of the 
local government concerned. 


C. 200. Partisan Political Activity. - No local official or employee in the 
career civil service shall engage directly or indirectly in any partisan political activity or 
take part in any election, initiative, referendum, plebiscite, or recall, except to vote, nor 
shall he use his official authority or influence to cause the performance of any political 
activity by any person or body. He may, however, express his views on current issues, 
or mention the names of certain candidates for public office that he supports. Elective 
local officials may take part in partisan political and electoral activities, but it shall be 
unlawful for them to solicit contributions from their subordinates or subject these 
subordinates to any of the prohibited acts under the Omnibus Election Code. 
SEC. 201. Appointment of Elective and Appointive Local Officials; 
Candidates Who Lost in Election. - (a) No elective or appointive local official shall be 
eligible for appointment or designation in any capacity to any public office or position 
during his tenure. 
Unless otherwise allowed by law or by the primary functions of his position, no 
elective or appointive local official shall hold any other office or employment in the 
government or any subdivision, agency or instrumentality thereof, including 
government-owned or -controlled corporations or their subsidiaries. 
(b) Except for losing candidates in barangay elections, no candidate who lost in any 
election shall, within one (I) 
year after such election, be appointed to any office 
in the government or any government-owned or -controlled corporations or in any 
of their subsidiaries. 
SEC. 202. Additional or 
oubk Compensation. - No elective or appointive 
local official or employee shall receive additional, double, or indirect compensation, 
unless specifically authorized by law, nor accept without the consent of Congress, any 
present, emoluments, office, or title of any kind from any foreign government. Pensions 
or gratuities shall not be considered as additional, double, or indirect compensation 
03. Permission to Leave Station. - (a) Provincial, city, municipal, and 
barangay appointive officials going on official travel shall apply and secure written 
permission from their respective local chief executives before departure. The application 
shall specify the reasons for such travel, and the permission shall be given or withheld 
based on considerations of public interest, financial capability of the local government 
concerned and urgency of the travel. 
Should the local chief executive concerned fail to act upon such application 
within four (4) working days from receipt thereof, it shall be deemed approved. 
(b) Mayors of component cities and municipalities shall secure the permission of the 


governor concerned for any travel outside the province. 
(c) Local government officials traveling abroad shall notify their respective 
sanggunian: Provided, That when the period of travel extends to more than three 
(3) months, during periods of emergency or crisis or when the travel involves the 
use of public funds, permission from the Office of the President shall be secured. 
(d) Field officers of national agencies or offices assigned in provinces, cities, and 
municipalities shall not leave their official stations without giving prior written 
notice to the local chief executive concerned. Such notice shall state the duration 
of travel and the name of the officer whom he shall designate to act for and in his 
behalf during his absence. 
SEC. 204. Annual Report. - On or before March thirty-first (31st) of each year, 
every local chief executive shall submit an annual report to the sanggunian concerned 
on the socioeconomic, political and peace and order conditions, and other matters 
concerning the local government, which shall cover the immediately preceding calendar 
year. A copy of the report shall be forwarded to the Department of Interior and Local 
Government. Component cities and municipalities shall likewise provide the 
sangguniang panlalawigan copies of their respective annual reports. Likewise the 
Regional Governments shall be furnished copies of the annual reports of all local 
governments. 
Chapter 
Local Gowernment Compensation 
SEC. 205. Local Salay and Position Council. - The Civil Service Commission 
together with all the chairmen of the Leagues of Provinces, Cities and Municipalities 
shall be constituted as the Local Salary and Position Council which shall design and 
formulate a new salary structure for all elective and appointive officials in all levels of 
local government following the principles of equal pay for comparatively equal work and 
based on the affordability principle in accordance with the following guidelines: 
a) Forty-five to fifty-five percent (45-55%) personnel services strictlylabsolutely 
complied with by local governments; 
(b) Any salary increases should only be once in every three (3) years: Provided, that 
this limitation shall not apply to merit promotions; and 
(c) Effectivity of the new salary increases for elective local officials shall take effect 
until after the expiration of the full term of all local elective officials approving 
such increases. 


aiary Laws in the ~~~~~~~ 
interim period, while the new salary structure is not yet installed, the provisions of 
existing salary laws (RA 6758) shall apply. 
Chapter 7 
chool Boards 
SEC. 207. Creation, Composition and Compensation. - (a) There shall be 
established in every province, city, or municipality a provincial, city or municipal school 
board, respectively 
(b) The composition of local school boar& shall be as follows: 
(1) 
The provincial school board shall be composed of the governor and the 
division superintendent of schools as co-chairmen; the chairman of the 
education committee of the sangguniang panlalawigan, the provincial 
treasurer, the representative of the pederasyon ng mga sangguniang 
kabataan in the sangguniang panlalawigan, the duly elected president of 
the provincial federation of parents-teachers association, the duly elected 
representative of the teachers' organization in the province, and the duly 
elected representative of the non-academic personnel of public schools in 
the province, as members; 
The city school board shall be composed of the city mayor and the city 
superintendent of schools as co-chairmen; the chairman of the education 
committee of the sangguniang panlungsod, the city treasurer, the 
representative of the pederasyon ng mga sangguniang kabataan in the 
sangguniang panlungsod, the duly elected president of the city federation 
of parents-teachers associations, the duly elected representative of the 
teachers' organizations in the city, and the duly elected representative of 
the non-academic personnel of public schools in the city, as members; 
and 
The municipal school board shall be composed of the municipal mayor 
and the district supervisor of schools as co-chairmen; the chairman of the 
education committee of the sangguniang bayan, the municipal treasurer, 
the representative of the pederasyon ng mga sangguniang kabataan in 
the sangguniang bayan, the duly elected president of the municipal 
federation 
of 
parents-teachers associations, 
the 
duly 
elected 
representative of the teachers' organizations in the municipality, and the 
duly elected representative of the non-academic personnel of public 
schools in the city, as members; 
(2) 
(3) 


(c) In the event that a province or city has two (2) or more school superintendents, 
and in the event that a municipality has two (2) or more district supervisors, the 
co-chairman of the local school board shall be determined as follows: 
(1) The Department of Education, Culture and Sports shall designate the co- 
chairman for the provincial and city school boards; and 
(2) The division superintendent of schools shall designate the district supervisor 
who shall serve as co-chairman of the municipal school board. 
(d) The performance of the duties and responsibilities of the above mentioned 
officials in their respective local school boards shall not be delegated to any 
officia I. 
SEC. 
208. Functions of Local School 
oards. - The provincial, city or 
municipal school board shall: 
(a) Propose to the sanggunian concerned, in accordance with the criteria set by the 
Department of Education, Culture and Sports, the annual supplementary 
budgetary needs for the operation and maintenance of public schools within the 
province, city or municipality, as the case may be, and the supplementary local 
cost of meeting such needs, which shall be reflected in the form of an annual 
school board budget corresponding to its share in the proceeds of the special 
levy on real property constituting the Special Education Fund and such other 
sources of revenue as this Code and other laws or ordinances may provide; 
(b) Upon recommendation of the School Board and after the approval of the 
Sanggunian concerned the provincial, city or municipal treasurer, as the case 
may be, shall disburse funds from the Special Education Fund pursuant to the 
budget prepared; 
(c) Serve as an advisory committee to the sanggunian concerned on educational 
matters such as, but not limited to, the necessity for and the uses of local 
appropriations for educational purposes; and 
(d) Recommend changes in the names of public schools within the territorial 
jurisdiction of the local government for enactment by the sanggunian concerned. 
The Department of Education, Culture and Sports shall consult the local school 
board on the appointment of division superintendents, district supervisors, school 
principals, and other school officials. 


SEC. 
et. - (a) The !oca1 S G ~ O O I  board shall 
meet at least once a month or as often as may be necessary. 
(b) Any of the co-chairmen may call a meeting. A majority of all its members shall 
constitute a quorum. However, when both co-chairmen are present in a meeting, 
the local chief executive concerned, as a matter of protocol, shall be given 
preference to preside over the meeting. The division superintendent, city 
superintendent or district supervisor, as the case may be, shall prepare the 
budget proposal of the school board concerned. Such budget shall be supported 
by programs, projects, and activities of the school board for the ensuing fiscal 
year. 
(c) The annual school board budget proposal, which shall be submitted to the 
sanggunian for its approval, shall give priority to the following: 
(I) Construction, repair, and maintenance of school buildings and other 
facilities of public elementary and secondary schools; 
Establishment and maintenance of extension classes where necessary; 
and 
Sports activities at the division, district, municipal, or barangay levels. 
(2) 
(3) 
EC. 21 0. Compensation and Remuneration. - The co-chairmen and members 
of the provincial, city or municipal school board shall perform their duties as such 
without compensation or remuneration. Members thereof who are not government 
officials or employees shall be entitled to necessary traveling expenses and allowances 
chargeable against funds of the local school board concerned, subject to existing 
accounting and auditing rutes and regulations. 
Chapter 8 
Local Health Boards 
SEC. 21 1. Creation and Composition. - (a) There shall be established a local 
health board in every province, city or municipality. The composition of the local health 
boards shall be as follows: 
(I) The provincial health board shall be headed by the provincial governor as 
chairman, the provincial health officer as vice-chairman, and the chairman 
of the committee on health of the sangguniang panlalawigan, a 
representative from the private sector or non-governmental organizations 
involved in health services, and a representative of the Department of 
Health in the province, as members; 
The city health board shall be headed by the city mayor as chairman, the 
(2) 


city health officer as Vice-chairman, and the chairman of the committee on 
health of the sangguniang panlungsod, a representative from the private 
sector or non-governmental organizations involved in health services, and 
a representative of the Department of Health in the city, as members; and 
The municipal health board shall be headed by the municipal mayor as 
chairman, the municipal health officer as vice-chairman, and the chairman 
of the committee on health of the sangguniang bayan, a representative 
from the private sector or non governmental organizations involved in 
health services, and a representative of the Department of Health in the 
municipality, as members; 
(3) 
(b) The functions of the local health board shall be: 
To propose to the sanggunian concerned, in accordance with standards 
and criteria set by the Department of Health, annual budgetary allocations 
for the operation and maintenance of health facilities and services within 
the municipality, city or province, as the case may be. 
To serve as an advisory committee to the sanggunian concerned on 
health matters such as, but not limited to, the necessity for, and 
application of, local appropriations for public health purposes; and 
Consistent with the technical and administrative standards of the 
Department of Health, create committees which shall advise local health 
agencies on matters such as, but not limited to, personnel selection and 
promotion, bids and awards, grievances and complaints, personnel 
discipline, budget review, operations review and similar functions. 
s and Quorum. - (a) The board shall meet at least once a 
month or as often as may be necessary. 
(b) A majority of the members of the board shall constitute a quorum, but the 
chairman or the vice-chairman must be present during meetings where budgetary 
proposals are being prepared or considered. The affirmative vote of all the majority of 
the members shall be necessary to approve such proposals. 
SEC. 24 3. Compensation and ~ ~ ~ ~ n ~ ~ a t i o n .  
- The chairman, vice-chairman, 
and members of the provincial, city or municipal health board shall perform their duties 
as such without compensation or remuneration. Members thereof who are not 
government officials or employees shall be entitled to necessary traveling expenses and 
allowances chargeable against the funds of the local health board concerned, subject to 
existing accounting and auditing rules and regulations. 


C. 244. Direct 
~~~~~~~~ 
~~~~~~~~~~ 
an 
~~n~~~~ by the 
~~~~~~~~ 
of 
Health. - In cases of epidemics, pestilence, and other widespread public health 
dangers, the Secretary of Health may, upon recommendation of the health board 
concerned and in consultation with the local government concerned, temporarily 
assume direct supervision and control over health operations in any local government 
for the duration of the emergency, but in no case exceeding a cumulative period of six 
(6) months. With the concurrence of the local government concerned, the period for 
such direct national control and supervision may be further extended. 
Chapter 
Local Development Strategy and Local Council 
SEC. 215. Local Development Strategy. - It shall be a national policy and local 
development strategy that interlocal, interregional and intraregional cooperation among 
local authorities shall be encouraged as a preferred mode of development strategy. The 
institutional requirements that will facilitate the effective implementation of an integrated 
local development programs shall be given priority consideration. 
SEC. 216. Local Development Councils. - (a) Each local government shall 
have a comprehensive multi-sectoral development plan to be initiated by its 
development council and approved by its sanggunian. For this purpose, the 
development council at the provincial city, municipal, or barangay level, shall assist the 
corresponding sanggunian in setting the direction of economic and social development, 
and coordinating development efforts within its territdrial jurisdiction. 
SEC. 217. Composition of Local Development Councils. - The composition 
of the local development council shall be as follows: 
(a) The barangay development council shall be headed by the punong barangay and 
shall be composed of the following members: 
(I) 
(2) 
Representatives of non-governmental organizations operating in the 
barangay, who shall constitute not less than one-fourth (1/4) of the 
members of the fully organized council; 
A representative of the congressman. 
Members of the sangguniang barangay; 
(3) 
(b) The city or municipal development council shall be headed by the mayor and 
shall be composed of the following members: 
(I) All punong barangay in the city or municipality; 


(2) 
The chairman OF the committee on appropriations o.f the sangguniang 
panlungsod or sangguniang bayan concerned; 
The congressman or his representative; and 
Representatives of nongovernmental organizations operating in the city or 
municipality, as the case may be, who shall constitute not less than one- 
fourth (114) of the members of the fully organized council. 
(c) The provincial development council shall be headed by the governor and shall be 
(3) 
(4) 
composed of the following members: 
(I) 
(2) 
All mayors of component cities and municipalities; 
The chairman of the committee on appropriations of the sangguniang 
panlalawig an; 
The congressman or his representative; and 
(3) 
(4) 
Representatives of nongovernmental organizations operating in the 
province, who shall constitute not less than one-fourth (1/4) of the 
members of the fully organized council. 
(d) The local development councils may call upon any local official concerned or any 
official of national agencies or offices in the local government to assist in the 
formulation of their respective development plans and public investment 
programs. 
~ v ~ ~ n r n ~ ~ ~ a ~  
~ ~ a n ~ z a € ~ ~ n ~ .  
- Local 
governments shall promote the establishment and operation of people's and 
nongovernmental organizations to become active partners in the pursuit of local 
autonomy. 
Within a period of sixty (60) days from the start of organization of local 
development councils, the nongovernmental organizations shall choose from among 
themselves their representatives to said councils. The local sanggunian concerned shall 
accredit nongovernmental organizations subject to such criteria as may be provided by 
law. 
Local governments may enter into joint ventures and such other cooperative 
arrangements with people's and nongovernmental organizations to engage in the 
delivery of certain basic services, capability-building and livelihood projects, and to 
develop local enterprises designed to improve productivity and income, diversify 
agriculture, spur rural industrialization, promote ecological balance, and enhance the 
economic and social well-being of the people. 


SEX. 219. ~~r~~~~~~~ ot %oca! ~~v~~~~~~~~ ~~~~~~~~. 
- (a) The provincial, 
city, and municipal development councils shall exercise the following functions: 
Formulate 
long-term, 
medium-term, 
and 
annual 
socioeconomic 
development plans and policies; 
Formulate the medium-term and annual public investment programs; 
Appraise and prioritize socioeconomic development programs and 
projects; 
Formulate local investment incentives to promote the inflow and direction 
of private investment ea pit at; 
Coordinate, monitor, and evaluate the implementation of development 
programs and projects; and 
Perform such other functions as may be provided by law or competent 
authority. 
(b) The barangay development council shall exercise the following functions: 
(I 
) 
(2) 
(3) 
Mobilize people's participation in local development efforts; 
Prepare barangay development plans based on local requirements; 
Monitor and evaluate the implementation of national or local programs and 
projects; and 
Perform such other functions as may be provided by law or competent 
authority. 
(4) 
e. - (a) Each focal development council shall 
create an executive committee to represent it and act in its behalf when it is not in 
session. The composition of the executive committee shall be as follows: 
The executive committee of the provincial development council shall be 
composed of the governor as chairman, the representative of component 
city and municipal mayors to be chosen from among themselves] the 
chairman of the committee on appropriations of the sangguniang 
panlalawigan, the president of the provincial league of barangays, and a 
representative of nongovernmental organizations that are represented in 
the council, as members; 
The executive committee of the city or municipal development council 
shall be composed of the mayor as chairman, the chairman of the 
committee on appropriations of the sangguniang panlalawigan, the 
president of 
the city or municipal league of barangays, and a 
representative of nongovernmental organizations that are represented in 
the council, as members; and 
The executive committee of the barangay development council shall be 


composed of the punong barangay as chairman, a representative of the 
sangguniang barangay to be chosen from among its members, and a 
representative of nongovernmental organizations that are represented in 
the council, as members. 
(b) The executive committee shall exercise the following powers and functions: 
(I) Ensure that the decision of the council are faithfully carried out and 
implemented; 
Act on matters requiring immediate attention or action by the council; 
Formulate policies, plans, and programs based on the general principles 
laid down by the council; and 
Act on other matters that may be authorized by the council. 
(2) 
(3) 
(4) 
. - The local development 
councils may form sectoral or functional committees to assist them in the performance 
of their functions. 
SEC. 222. Secretariat. - There is hereby constituted for each local development 
council a secretariat which shall be responsible for providing technical support, 
documentation of proceedings, preparation of reports and such other assistance as may 
be required in the discharge of its functions. The local development council may avail of 
the services of any nongovernmental organization or educational or research institution 
for this purpose. 
The secretariats of the provincial, city, and municipal development councils shall 
be headed by their respective planning and development coordinators. The secretariat 
of the barangay development council shall be headed by the barangay secretary who 
shall be assisted by the city or municipal planning and development coordinator 
concerned. 
SEC. 223. Relation of Local Development Councils to the anggunian and 
the Regional 
evelopment Councils. - (a) The policies, programs, and projects 
proposed by local development councils shall be submitted to the sanggunian 
concerned for appropriate action. The local development plans approved by their 
respective sanggunian may be integrated with the development plans of the next higher 
level of local development councils. 


(b) The approved development plans of provinces, highly-urbanized cities, ana 
independent component cities shall be submitted to the regional development 
council, which shall be integrated into the regional development plan for 
submission to the National Economic and Development Authority, in accordance 
with existing laws. 
SEC. 224. Budget Information. - The Department of Budget and Management 
shall furnish the various local development councils information on financial resources 
and budgetary allocations applicable to their respective jurisdictions to guide them in 
their planning functions. 
Chapter “1 
Local Peace and Order Council 
SEC. 225. Organization. - The existing Local Peace and Order Council in every 
province, city and municipality shall consider and approve the peace and order plan 
formulated by the local chief executive concerned. 
The Local Peace and Order Council shall be reorganized as follows: 
(a) Provincial peace and order council shall be composed of the provincial governor 
as chairman, vice governor as vice chairman, a member of the sangguniang 
panlalawigan, and a representative of the veteran group and three (3) of the 
private sector who shall be designated or appointed by the chairman of the 
National Police Commission; 
(b) City Peace and Order Council shall be composed of the City Mayor as Chairman, 
Vice Mayor as Vice Chairman, a member of the sangguniang panlungsod, a 
representative of the Veterans Group, the Chief of Police, and three (3) of the 
private sector who shall be designated or appointed as members by the 
chairman of the National Police Commission. 
(c) Municipal Peace and Order Council shall be composed of the Municipal Mayor 
as Chairman, Vice Mayor as Vice Chairman, a member of the sangguniang 
bayan, the Chief of Police, and a representative of the Veterans Group and three 
(3) of the private sectors who shall be designated or appointed as members by 
the Chairman of the National Police Commission. 
The Provincial Peace and Order Council shall consolidate the duly approved 
Peace and Order Plans of cities and municipalities, which are components of the 
province. 


Autonomous pecial Economic 
SEC. 226. Establishment of Autonomous 
corromic Zones. - The 
establishment by law of autonomous special economic zones in selected areas of the 
country shall be subject to concurrence by the local governments included therein. 
Chapter 'I 2 
Other Provisions Applicable: to Local Governments 
Article One. Settlement of 
SEC. 
227. Jurisdictional Responsibility for Settlement of 
Dispute. - Boundary disputes between arid among local governments shall, as much 
as possible, be settled amicably. To this end: 
(a) Boundary disputes involving two (2) or more barangays in the same city or 
municipality shall be referred for settlement to the sangguniang panlungsod or 
sangguniang bayan concerned. 
(b) Boundary disputes involving two (2) or more municipalities within the same 
province shall be referred for settlement to the sangguniang panlalawigan 
concerned. 
(c) Boundary disputes involving municipalities or component cities of different 
provinces shall be jointly referred for settlement to the sanggunian of the 
provinces concerned. 
(d) Boundary disputes involving a component city or municipality on the one hand 
and a highly urbanized city on the other, or two (2) or more highly urbanized 
cities, shall be jointly referred for settlement to the respective sanggunian of the 
parties. 
(e) In the event the sanggunian fails to effect an amicable settlement within sixty (60) 
days from the date the dispute was referred thereto, it shall issue a certification to 
that effect. Thereafter, the dispute shall be formally tried by the sanggunian 
concerned, which shall decide the issue within sixty (60) days from the date of 
the certification referred to above. 
SEX. 228. Appeal. - Within the time and manner prescribed by the Rules of 
Court, any party may elevate the decision of the sanggunian concerned to the proper 
Regional Trial Court having jurisdiction over the area in dispute. 


. - Local initiative is the political legal process 
whereby the registered voters of a local government may directly propose, enact, or 
amend any ordinance. 
SEC. 230. Who May xercise. - The power of local initiative and referendum 
may be exercised by all registered voters of the provinces, cities, and municipalities. 
rocedure En Local Initiative. - (a) Mot less than one thousand 
(1,000) registered voters in case of provinces and cities, one hundred (100) in case of 
municipalities, may file a petition with the sanggunian concerned proposing the 
adoption, enactment, repeal, or amendment of an ordinance. 
(b) If no favorable action thereon is taken by the sanggunian concerned within thirty 
(30) days from its presentation, the proponents, through their duly authorized and 
registered representatives, may invoke their power of initiative, giving notice 
thereof to the sanggunian concerned. 
(c) The proposition shall be numbered serially starting from Roman numeral 1. The 
Comelec or its designated representative shall extend assistance in the 
formulation of the proposition. 
(d) Two (2) or more propositions may be submitted in an initiative. 
(e) Proponents shall have ninety (90) days in case of provinces and cities, sixty (60) 
days in case of municipalities, from notice mentioned in subsection (b) hereof to 
collect the required number of signatures. 
(f) The petition shall be signed before the election registrar, or his designated 
representatives, in the presence of a representative of the proponent, and a 
representative of the sanggunian concerned in a public place in the local 
government, as the case may be. Stations for collecting signatures may be 
established in as many places as may be warranted. 
(9) Upon the lapse of the period herein provided, the Comelec, through its office in 
the local government concerned, shall certify as to whether or not the required 
number of signatures has been obtained. Failure to obtain the required number 
defeats the proposition. 
(h) If the required number of signatures is obtained, the Cornelec shall then set a 
date for the initiative during which the proposition shalt be submitted to the 
registered voters in the local government concerned for their approval within sixty 
(60) days from the date of certification by the Comelec, as provided in subsection 
(9) hereof, in case of provinces and cities, forty-five (45) days in case of 


municipalities. The initiative shall then be held on the date set, after which the 
results thereof shall be certified and proclaimed by the Comelec. 
ffectivity of Local 
. - If the proposition is approved by 
a majority of the votes cast, it shall take effect fifteen (1 5) days after certification by the 
Comelec as if affirmative action thereon had been made by the sanggunian and local 
chief executive concerned. If it fails to obtain said number of votes, the proposition is 
considered defeated. 
SEC. 233. ~~~~~a~~~~~ 
an Local Initiatives. - (a) The power of local initiative 
shall not be exercised more than once a year. 
(b) Initiative shall extend only to subjects or matters, which are within the legal 
powers of the sanggunian to enact. 
(c) If at any time before the initiative is held, the sanggunian concerned adopts in 
toto the proposition presented and the local chief executive approves the same, 
the initiative shall be canceled. However, those against such action may, if they 
so desire, apply for initiative in the manner herein provided. 
EC. 234. Limitations Upon a
~
~
~
~
~
i
~
~
.
 
- Any proposition or ordinance 
approved through the system of initiative and referendum as herein provided shall not 
be repealed, modified or amended by the sanggunian concerned within six (6) months 
from the date of the approval thereof, and may be amended, modified or repealed by 
the sanggunian within three (3) years thereafter by a vote of three-fourths (3/4) 
of all its 
members. 
EC. 235. Local 
efined. - Local referendum is the legal process 
whereby the registered voters of the local governments may approve, amend or reject 
any ordinance enacted by the sanggunian. 
The local referendum shall be held under the control and direction of the 
Comelec within sixty (60) days in case of provinces and cities, forty-five (45) days in 
case of municipalities and thirty (30) days in case of barangays. 
The Comelec shall certify and proclaim the results of the said referendum. 


SE@. 
. ~~~~~~~~~y of Corsrts. - Nothing in this Chapter shafi prevent or 
preclude the proper: courts from declaring null and void any proposition approved 
pursuant to this Chapter for violation of the Constitution or want of capacity of the 
sanggunian concerned to enact the said measure. 
37. Purpose of 
anization. - There shall be an organization of all 
barangays to be known as the liga ng mga barangay for the primary purpose of 
determining the representation of the liga in the sanggunian, and for ventilating, 
articulating and crystallizing issues affecting barangay government administration and 
securing, through proper and legal means, solutions thereto. 
SECTION 238. Representation, Chapters, National Liga. - Every barangay 
shall be represented in said liga by the punong barangay, or in his absence or 
incapacity, by a sanggunian member duly elected for the purpose among its members, 
who shall attend all meetings or deliberations called by the different chapters of the liga. 
The liga shall have chapters at the municipal, city, provincial and metropolitan political 
subdivision levels. The municipal and city chapters of the liga shall be composed of the 
barangay representatives of municipal and city barangays, respectively. The duly 
elected presidents of component municipal and city chapters shall constitute the 
provincial chapter or the metropolitan political subdivision chapter. The duly elected 
presidents of highly urbanized cities, provincial chapters, the Metropolitan Manila 
chapter and metropolitan political subdivision chapters shall constitute the National Liga 
ng mga barangay. 
SECTION 23 
rganization. - The liga at. the municipal, city, provincial, 
metropolitan political subdivision, and national levels directly elect a president, a vice- 
president, and five (5) members of the board of directors. The board shall appoint its 
Secretary and treasurer and create such other positions, as it may deem necessary for 
the management of the chapter. A Secretary general shall be elected from among the 
members of the national liga and shall be charged with the overall operation of the liga 
on the national level. The board shall coordinate the activities of the chapters of the liga. 


unian. - The duly elected 
presidents of the liga at the municipal, city and provincial levels, including the 
component cities and municipalities of Metropolitan Manila, shall serve as ex-officio 
members of the sangguniang bayan, sangguniang panlungsod, sangguniang 
panlalawigan, respectively. They shall serve as such only during their term of office as 
presidents of the liga chapters, which in no case shall be beyond the term of office of 
the sanggunian concerned. 
SECTION 244. Functions and Powers of the Liga. - The Liga shall: 
(a) Give priority to programs designed for the total development of the barangays 
and in consonance with the policies, programs and projects of the national 
government; 
(b) Assist in the education of barangay residents for people's participation in local 
government administration in order to promote united and concerted action to 
achieve country-wide development goals; 
(c) Supplement the efforts of government in creating gainful employment within the 
(d) Adopt measures to promote the welfare of barangay officials; 
(e) Serve as a forum of the barangays in order to forge linkages with government 
and non governmental organizations and thereby promote the social, economic 
and political well being of the barangays; and 
(f) Exercise such other powers and perform such other duties and functions, which 
will bring about stronger ties between barangays and promote the welfare of the 
barangay inhabitants. 
barangay; 
' 
Article Two. League sf 
%ECTION 242. Purpose of Organization. - There shall be an organization of all 
municipalities to be known as league of municipalities for the primary purpose of 
ventilating, articulating and crystallizing issues affecting municipal government 
administration, and securing, through proper and legal means, solutions thereto. The 
league shall form provincial chapters composed of the league presidents for all 
component municipalities of the province. 
3. Representation. - Every municipality shall be represented in the 
league by the municipal mayor or in his absence, by the vice-mayor or a sanggunian 
member duly elected for the purpose by the members, who shall attend all meetings 
and participate in the deliberations of the league. 


unctions and Pswe 
league of municipalities shall: 
(a) Assist the national government in the formulation and implementation of the 
policies, programs and projects affecting municipalities as a whole; 
(b) Promote local autonomy at the municipal level; 
(c) Adopt measures for the promotion of the welfare of all municipalities and its 
officials and employees; 
(d) Encourage people's participation in local government administration in order to 
promote united and concerted action for the attainment of country-wide 
development goals; 
(e) Supplement the efforts of the national government in creating opportunities for 
gainful employment within the municipalities; 
(f) Give priority to programs designed for the total development of the municipalities 
in consonance with the policies, programs and projects of the national 
government; 
(9) Serve as a forum for crystallizing and expressing ideas, seeking the necessary 
assistance of the national government, and providing the private sector avenues 
for cooperation in the promotion of the welfare of the municipalities; and 
(h) Exercise such other powers and perform such other functions as the league may 
prescribe for the welfare of the municipalities. 
Article Three. League of Citie 
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- There shall be an organization of all 
cities to be known as the League of Cities for the primary purpose of ventilating, 
articulating and crystallizing issues affecting city government administration, and 
securing, through proper and legal means, solutions thereto. 
The League may form chapters at the provincial level for the component cities of 
a province. Highly urbanized cities may also form a chapter of the League. The National 
League shall be composed of the presidents of the league of highly urbanized cities and 
the presidents of the provincial chapters of the league of component cities. 
~ ~ ~ ~ ~ ~ m t a t ~ o m .  
- Every city shall be represented in the league by the 
city mayor or in his absence, by the city vice-mayor or a sanggunian member duly 
elected for the purpose by the members, who shall attend all meetings and participate in 
the deliberations of the league. 


ue of Cities. - -rhf3 league of 
cities shall: 
(a) Assist the national government in the formulation and implementation of the 
policies, programs and projects affecting cities as a whole; 
(b) Promote local autonomy at the city tevel; 
(e) Adopt measures for the promotion of the welfare of all cities and its officials and 
employees; 
(d) Encourage people's participation in local government administration in order to 
promote united and concerted action for the attainment of country-wide 
development goals; 
(e) Supplement the efforts of the national government in creating opportunities for 
(f) Give priority to programs designed for the total development of cities in 
consonance with the policies, programs and projects of the national government; 
(9) Serve as a forum for crystallizing national government and providing the private 
gainful employment the cities; 
sector avenues for cooperation in the promotion of the welfare of the cities; and 
(h) Exercise such other powers and perform such other functions as the league may 
prescribe for the welfare of the cities. 
Article Four. League of 
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- There shall be an organization of all 
provinces to be known as the League of Provinces for the primary purpose of 
ventilating, articulating and crystallizing issues affecting provincial and metropolitan 
political subdivision government administration, and securing, through proper and legal 
means, solutions thereto. For this purpose, the Metropolitan Manila Area and any 
metropolitan political subdivision shall be considered as separate provincial units of the 
league. 
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- Every province shall be represented in the league 
by the provincial governor or in his absence, by the provincial vice-governor or a 
sanggunian member duly elected for the purpose by the members, who shall attend all 
meetings and participate in the deliberations of the league. 
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- The league of 
provinces shall: 
(a) Assist the national government in the formulation and implementation of the 
policies, programs and projects affecting provinces as a whole; 


(b) Promote local autonomy at the provincial level; 
(c) Adopt measures for the promotion of the welfare of all provinces and its officials 
and employees; 
(d) Encourage peoples participation in local government administration in order to 
promote united and concerted action for the attainment of countrywide 
development goals; 
(e) Supplement the efforts of the national government in creating opportunities for 
gainful employment within the province; 
(f) Give priority to programs designed for the total development of the provinces in 
consonance with the policies, programs and projects of the national government; 
(9) Serve as a forum for crystallizing and expressing ideas, seeking the necessary 
assistance of the national government and providing the private sector avenues 
for cooperation in the promotion of the welfare of the provinces; and 
(h) Exercise such other powers and perform such other functions as the league may 
prescribe for the welfare of the provinces and metropolitan political subdivisions. 
Adicle Five. Provision common To all Leagues 
SEC, 251. - Funding. (a) All leagues shall derive its funds from contribution of 
member local governments and from fund-raising projects and aciivjties without the 
necessity of securing permits therefore: Provided, That the proceeds from said fundd- 
raising projects and activities shall be used primarily to fund the projects for which the 
said proceeds have been raised, subject to the pertinent provisions of this Code and the 
pertinent provisions of the Omnibus Election Code. 
(b) All funds of leagues shall be deposited as trust funds with its treasurer and 
shall be disbursed in accordance with the board of director’s resolutions, subject to 
pertinent accounting and auditing rules and regulations: Provided, That the treasurer 
shall be bonded in an amount to be determined by the board of directors. The funds of 
a Structure.- To ensure the effective and efficient administration, the leagues for 
municipalities, cities and provinces shall elect chapter-level and national-level boards of 
directors and a set of officers headed by the president. A chapter shall be deposited as 
chapter funds and funds of the national league shall be deposited as national funds. 
EC. 
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To ensure the effective and efficient 
administration, the leagues for municipalities, cities and provinces shall elected chapter- 
level and national-level boards of directors and a set of officers headed by the 
president. A secretary-general shall be chosen from among the national league 
members to manage the day-to-day operation and activities of the national league. The 


board of directors on the chapter or national level may create such ether positicns 3s 
may be deemed necessary for the management of the chapters and other national 
league. The national board of directors of the leagues for municipalities, cities or 
provinces shall coordinate programs, projects and activities of chapter and national- 
level degree. 
y-laws of the Liga md Leagues- All other 
matters not herein otherwise provided for affecting the international organization of the 
leagues of local governments shall be governed by their respective constitution and by- 
laws which are hereby made suppletory to the provisions of this Chapter: Provided, That 
said Constitution and By-Laws shall always conform to the provisions in the Constitution 
and existing laws. 
rganization -(a) Vice-governors, vice-mayors, sanggunian 
members of barangays, municipalities, component cities, high urbanized cities and 
provinces, and other elective local officials of local governments, including those of the 
Metropolitan Manila area and any metropolitan political subdivisions, may form their 
respective leagues. or federation, subject to applicable provisions of this Title and 
pertinent provisions of this Code. 
(b) Sanggunian members of component cities and municipalities shall form a 
provincial federation and elect a board of directors and a set of,officers headed by the 
president. The duty elected president of the provincial federation of sanggunjang 
members of component cities and municipalities shall be an ex-officio member of the 
sangguniang panlalawigan concerned and shall serve as such only during his term of 
office as president of the provincial federation of sanggunian members of component 
cities and municipalities, which in no case shall be beyond the term of office of the 
sang g u n i ang pan I al awig an concerned. 
y-8aws.- The leagues or federations shall adopt 
a Constitution and by-laws, which shall govern their internal organization and operation: 
Provided, that said Constitution and by-laws shall always conform to the provision of the 
Constitution and existing laws. 


56. - Funding. The leagues and federations may derive their funds from 
contributions of individual league or federation members or from fund-raising projects or 
activities. 
SEC. 257. - Scope.- The provisions of this Chapter shall govern the exercise by 
provinces, cities, municipalities, and barangay of their taxing and other revenue-raising 
powers. 
SEC. 258. - 
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Each local government 
shall exercise its power to create its own sources of revenue and to levy taxes, fees, 
and charges subject as provided herein, consistent with the basic policy of local 
autonomy. 
Such taxes, fees , and charges shall accrue exclusively to the local 
governments imposing the same. 
SEC. 259. - 
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.- The following fundamental principles 
shall govern the exercise of the taxing and other revenue -raking powers of local 
governments: 
(a) Taxation shall be uniform in each local government; 
(b) Taxes, fees, charges and other impositions shall: 
(1) Be equitable and based as far as practicable on the taxpayer’s ability 
to pay; 
(2) Be levied and collected only for public purposes. 
(3) Not be unjust, excessive, oppressive, or confiscatory; 
(4) Not be contrary to law, public policy, national ecunomic policy, or in 
restraint of trade; 
(c) The collection of local taxes, fees, charges and other impositions shall in no 
case be let to any private person; 
(d)The revenue collected pursuant to the provisions of this Code shall insure 
solely to the benefit of, and be subject to disposition by, the local government 
levying the tax, free, charge or other imposition unless otherwise specifically 
provided herein; and 


(e) Each local governrnerit shall, as far as practicable, evolve a progressive 
system of taxation. 
s.- When used in this Chapter, the term: 
(a) “Agricultural product” includes the yield of the soil, such as corn, rice wheat, 
rye, hay, coconuts, sugarcane, tobacco, rot crops, vegetables, fruits, flowers, 
and their by-products; ordinary salt; all kinds fish; poultry; and livestock and 
animal products, whether in their original form or not. 
The phrase “whether in their original form or not” refers to the transformation of 
said products by the farmer, fisherman, producer or owner through the application of 
processes to preserve or otherwise to prepare said products for the market such as 
freezing, drying, salting, smoking, or stripping for the purposes of preserving or 
otherwise preparing said product s for market; 
(b) “Amusement” is a pleasurable diversion and entertainment. it is synonymous 
to relaxation, avocation, pastime, or fun; 
(c) “Amusement Places” include theaters, cinemas, concert halls, circuses and 
other places of amusement where one seeks admission to entertain oneself 
by seeing or viewing the show or performances; 
(d) “Business” means trade or commercial activity regularly engaged in as a 
means of livelihood or with a view to profit; 
(e) “Capital Investment” is the capital which a person employees in any 
undertaking, or which he contributes to the capital of a partnership, 
corporation, or any other juridical entity or association in a particular taxing 
jurisdiction. 
(f) “Charges” refer to pecuniary liability, as rents or fees against person to 
property; 
(9) “Fee” means a charge fixed by laws or ordinance for the regulation or 
inspection of a business or activity; 
(h) “Franchise” is a right or privilege, affected with public interest which is 
conferred upon private persons or corporations, under such terms and 
conditions as the government and its political subdivisions may impose in the 
interest of public welfare, security, and safety; 
(i) “Gross Sales or Receipt” include the total amount of money or its equivalent 
representing the contract price, compensation or service fee, including the 
amount charged or materiais suppiied with the services and deposits or 
advance payments actually or constructively received during the taxable 


quarter for the services performed or to be performed for another person 
excluding discounts if determinable at the time of sales, sales return, excise 
tax, and value-added tax(VAT); 
(j) “Marginal Farmer or Fisherman” refers to an individual engaged in 
subsistence farming or fishing which shall be limited to the sale, barter or 
exchange of agricultural or marine products produced by himself and his 
immediate family; 
(k) “Motor Vehicle” means any vehicle propelled by any power other than 
muscular power using the public roads, but excluding road rollers, trolley 
cars, street-sweepers, sprinklers, lawn mowers, bulldozers, graders, fork-lifts, 
amphibian trucks, and cranes if not used on public roads, vehicles which run 
only on rail tracks, and tractors, trailers, and traction engines of all kinds used 
exclusively for agricultural purposes; 
(I) “Municipal Waters” includes not only streams, lakes, and tidal waters within 
the municipality, not being the subject of private ownership and not 
comprised within the national parks, public forest, timber lands, forest 
reserves or fishery reserves, but also marine waters induded between two 
lines drawn perpendicularly to the general coastline from points where the 
boundary lines of the municipality or city touch the sea at low tide and third 
line parallel with the general coastline and fifteen(l5) kilometers from it. 
When two (2) municipalities are so situated on the opposite shores that there 
is less than fifteen (15) kilometers of marine waters between them, the third 
line shall be equally distant from opposite shores of the perspective 
municipalities; 
(m) “Operator” includes the owner, manager, administrator, or any other person 
who operates or is responsible for the operation of a business establishment 
or undertaking; 
(n) “Peddler” means any person who, either for himself or on commission, travels 
from place to place and sells his goods or offers to sell and deliver the same; 
( 0 )  “Persons” means every natural or juridical being, susceptible of rights and 
obligations or of being the subject of legal relations; 
(p) “Vessel” includes every type of boat, craft, or other artificial contrivance used, 
or capable of being used, as a means of transportation on water; and 
(9) “Wharfage” means a fee against the cargo of a vessel engaged in foreign or 
domestic trade based on quantity, weight, or measure received and/or 
discharged by vessel. 


SEC. 261. - !..ocas Taxin 
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The power to impose a tax, feelor charge 
or to generate revenue under this Code shall be exercised by the sanggunian of the 
local government concerned through an appropriate ordinance. 
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Local 
Governments. Unless otherwise provided herein, the exercise of the taxing powers of 
Regional Government, provinces, cities, municipalities, and barangays shall not extend 
to the levy of the following: 
(a) Income tax, except when levied on banks and other financial 
ins ti tu t ions; 
(b) Documentary stamp tax; 
(c) Taxes on estates, inheritance, gifts, legacies and other acquisitions 
(d) Customs duties and registration fees of vessel with tonnage of five (5) 
tons and above, wharfage on wharves constructed, maintained or 
operated by the local government concerned or by a private person or 
entity; 
(e) Taxes, fee and charges and other impositions upon goods carried into 
or out of, or passing through, the territorial jurisdictions of local 
governments in the gujse of charges for wharfage, tolls for bridges or 
otherwise, or other taxes, fees or charges in any form whatsoever 
upon such goods or merchandise; 
(f) Taxes, fees, or charges on agricultural and aquatic products when 
sold by marginal farmers or fishermen; 
mortis causa, except as otherwise provided herein; 
(9) Taxes on business enterprises certified to by the Board of 
Investments as pioneer non-pioneer for a period of six (6) and four (4) 
years, respectively from the date of registration; 
(h) Excise taxes and other taxes, fees or charges on petroleum products; 
(i) Percentage or value added tax (VAT) on sales, barters or exchanges 
or similar transactions on goods or services except as otherwise 
provided herein; 
u) Taxes on the gross receipts of transportation contractors and persons 
engaged in the transportation of passengers or fright by hire and 
common carriers by air, land, or water, except as provided in this 
Code; 
(k) Taxes on premium paid by way or reinsurance or retrocession; 


( I )  
Taxes for the registration of motor vehicles and for the issuance of all 
kinds of licenses or permits for the driving thereof except tricycles and 
public utility vehicles operating within the province; 
(m) Taxes, fees or charges on Philippine products actually exported, 
(n) Taxes, fees, or other charges, on cooperatives duly registered under 
Republic Act Numbered Sixty-Nine Hundred Thirty-Eight (R.A. 6938) 
otherwise known as the “Cooperative Code of the Philippines”; and 
( 0 )  Taxes of any kind on the national government, its agencies and 
instrumentalities, 
and 
local governments except quasi-public 
corporations, 
government 
banks, 
financing 
and 
investment 
institutions, gambling and gaming enterprises operated by the national 
government or its agents or instrumentalities, or contracted out by it to 
foreign or domestic corporations, individuals or entities, which have 
been given permits by the local governments. 
except as otherwise provided herein; 
EC. 263. - Scope of Yaxin Powers - Except as otherwise provided in this 
Code, the province may levy only the taxes, fees, and charges as provided in this 
Article. 
6. 
264. - Tax on Transfer of ea1 Propedy 
. - (a) The province 
may impose a tax on the sale, donation, barter, or any other mode of transferring 
ownership or title of real property at the rate of not more than fifty percent (50) of one 
percent (I %) of the total consideration involved in the acquisition of the property or of 
the fair market value in case the monetary consideration involved in the transfer is not 
substantial, whichever is higher. The sale, transfer or other disposition of real property 
pursuant to R. A. No. 6657 shall be exempt from this tax. 
(c) For this purpose, the Register of Deeds of the province concerned shall, 
before registering any deed, require the presentation of the evidence of 
payment of this tax. The provincial assessor shall 1ikewise make the same 
requirement before canceling an old tax declaration and issuing a new one in 
place thereof. Notaries public shall furnish the provincial treasurer with a 
copy of any deed transferring ownership or title to any real property within 
thirty (30) days from the date of notarization. 


It shall be the duty of the seller, donor, transferor, executor or administrator to 
pay the tax herein imposed within sixty (60 days from the date of the execution of the 
deed from the date of the decedent’s death. 
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may impose tax on the business of persons engaged in the printing andlor publication of 
books, cards, posters, leaflets, handbills, certificates, receipts, pamphlets, and other 
similar nature, at a rate not exceeding fifty percent (50%) of one percent (lob) of the 
gross annual receipts for the preceding calendar year. 
In the case of a newly started business, the tax shall not exceed one-twentieth 
(1/20) of one percent(l%) of the capital investment. In the succeeding calendar year, 
regardless of when the business started to operate, the tax shall be based on the gross 
receipts for the preceding calendar year, or any fraction thereof, as provided herein. 
The receipts from the printing and/or publishing of books or other reading 
materials prescribed by the Department of Education, Culture and Sports as school 
texts or reference shall be exempt from the tax herein imposed. 
Provided, that seventy percent (70%) of the proceeds of the tax mentioned in this 
section shall accrue to the province and thirty percent (30%) shall accrue to the 
municipality where the business is located. 
, - Franchise Pax.- Notwithstanding any exemption granted by any 
law or other special laws, the province may impose a tax on any business enjoying a 
franchise granted by Congress, a national government agency 01- a local government, 
including power generation, transmission and distribution, telecommunications, ice 
plants and storage facilities, legal gambling or gaming activities, and other similar 
businesses, based on income realized within the territorial jurisdiction, at a rate not 
exceeding fifty percent (50 %) of one percent (1%) of the gross annual receipts for the 
preceding year. 
SEC. 267. - %a 
province may levy and collect not more than ten percent (10%) of fair market value in 
the locality per cubic meter of ordinary stones, sand, gravel, earth, and other quarry 
resources, as defined under the National Internal Revenue Code, as amended, 
extracted from public lands or from the beds of seas, lakes, rivers, streams, creeks, and 
other public waters within the territorial jurisdiction. 
The permit to extract sand, gravel and other quarry resources shall be distributed 
as follows: 


I) 
Province - thirty percent (30%) 
2) Component city or municipality where the sand, gravel, and other quarry 
resources are extracted-thirty percent (30%); and 
3) Barangay where the sand, gravel, and other quarry resources are extracted- 
forty percent (40%). 
SEC.268. 
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onal 
ax,- (a) The province may levy an annual 
professional tax on each person engaged in the exercise or practice of his profession 
requiring government examination as such reasonable amount and classification as the 
sangguniang panlalawigan may provide but shall in no case exceed one thousand 
pesos (I 
,000.00). 
(b) Every person legally authorized to practice his profession shall pay the 
professional tax to the province where he practices his profession or where he 
maintains his principal office in case he practices his profession in several places: 
Provided, however, That such person who has paid the corresponding professional tax 
shall be entitled to practice his profession in any of the Philippines without being 
subjected to any other national or local tax, license or fee for the practice of such 
profession. 
0 
Any individual or corporation employing a person subject to professional tax 
shall require payment by that person of the tax on his profession before employment 
and annually thereafter. 
(d) The professional tax shall be payable annually on or before the thirty-first ( 
31 st) day of January. Any person, first beginning to practice a profession after 
the month of January , must, however, pay the full tax before engaging 
therein. A line of profession does not become exempt even if conducted with 
some other profession for which the tax has been paid. 
Professionals 
exclusively employed in the government shall be exempt from the payment of 
this tax. 
(e)Any person subject to the professional tax shall write in deeds, receipts, 
prescriptions, reports, books of account, plans and designs. Surveys and 
maps, as the case may be, the number of the official receipt issued to him. 
e. 269. " Amu ement Tax. - (a) The province may levy an amusement tax 
to be collected from the proprietors, lessees, or operators of theaters, cinemas, concert 
halls, circuses, boxing stadia, and other places of amusement at a rate of not more than 
thirty percent (30%) of the gross receipts from admission fees. 


(b) In the case of theaters of cinemas, the tax shall First be deducted and withheld 
their proprietors, lessees or operators and paid to the provincial treasurer before the 
gross receipts are divided between said proprietors, lessees, or operators and the 
distributors of the cinematographic films. 
0 The holding of operas, concerts, dramas, recitals, painting and art exhibitions, 
flower shows, musical programs, literary and oratorical presentations, except pop, rock, 
or similar concerts shall be exempt from the payment of the tax herein imposed. 
(d)The sangguniang panlalawigan may prescribe the time, manner, terms and 
conditions for the payment of tax. In case of fraud or failure to pay the tax, the 
sangguniang panlalawigan may impose such surcharges, interests and penalties as it 
may deemed necessary. 
(e)The proceeds from the amusement tax shall be shared equally by province the 
municipality where such amusement places are located. 
SEC. 270. - 
Annuat 
elivery Truck or Van of 
Manufacturers or Producers, Wholesalers of, Dealers, or etailers in, Certain 
Products. - (a) The province may levy an annual fixed tax for every truck, van or 
any vehicle used by manufacturers, producers, wholesalers, dealers or retailers in 
the delivery or distribution of distilled spirits, fermented liquors, soft drinks, cigars 
and cigarettes, and other products as may be determined by the sangguniang 
panlalawigan, to sales outlets, consumers, whether directly or indirectly, within the 
province. 
(b) The manufacturers, producers, wholesalers, dealers, and retailers referred 
to in the immediately foregoing paragraph shall be exempt from the tax on peddlers 
prescribed elsewhere in this Code. 
Article Three. 
cope of Taxing Power 
- Except as otherwise provided in 
this Code, the city, may levy the taxes, fees, and charges which the province or 
municipality may impose: Provided, however, That the taxes, fees and charges 
levied and collected by a highly urbanized and independent component cities shall 
accrue to them and distributed in accordance with the provisions of this Code. 
The rates of taxes that the city may levy may exceed the maximum rates 
allowed for the province or municipality by not more than fifty percent (50%) except 
the rates of professional and amusement taxes. 


Article Four. - 
. - Scope of Taxing Powers. - Except as otherwise provided in 
this Code, municipalities may levy taxes, fees, and charges not otherwise levied by 
provinces. 
SEC. 273. - 
Tax on 
. - The municipality may impose taxes on 
any business at rates not exceeding two percent (2%) based on the gross sales or 
receipts in the preceding calendar year. 
In the case of manufacturers, millers, producers, wholesalers, distributors, 
dealers, or retailers of essential commodities enumerated hereunder the rate shall 
not exceed one-half (112) of the rates imposed by the municipality in accordance 
with the preceding paragraph. 
(I 
) Rice and corn; 
(2) Wheat or cassava flour, meat, dairy products, locally manufactured, 
processed or preserved food, sugar, salt and other agricultural, marine, 
and fresh water products, whether in their original state or not; 
(3) Cooking oil and cooking gas; 
(4) Laundry soap, detergents, and medicine; 
(5) Agricultural implements, equipment and post harvest facilities, fertilizers, 
pesticides, insecticides, herbicides and other farm inputs; 
(6) Poultry feeds and other animal feeds; 
(7) School supplies; and 
(8) Cement 
In the case of transportation contractors, exporters, indirect exporters and 
export subcontractors, the rate of business taxes shall not exceed one percent (1 %) of 
gross sales or receipts of the preceding year. 
SEC. 274. - Rules of Tax within the ~~~r~~~~~~~~ Manila Area. - The 
municipalities within the Metropolitan Manila Area may levy taxes at rates, which shall 
not exceed by fifty percent (50%) the maximum rates prescribed in the preceding 
sect ion. 


glsirpess - A business subject to tax pursuant to 
the preceding sections shall, upon termination thereof, submit a sworn statement of its 
gross sales or receipts for the current year. If the tax paid during the year is less than 
the tax due on said gross sales or receipts of the current year, the difference shall be 
paid before the business concerned is officially retired. 
. - PaymW?t Qf 
usiness Taxe - (a} The taxes imposed under 
Section 273 of this Code shall be payable for every separate or distinct establishment or 
place where business subject to the tax is conducted and one line of business does not 
become exempt by being conducted with some other business for which such tax has 
been paid. The tax on a business must be paid by the person conducting the same. 
(b) In cases where a person conducts or operates two (2) or more 
businesses, the tax shall be computed on the combined total gross sales or 
receipts of the said two (2) or more businesses. 
0 In cases where a person conducts or operates two (2) or more 
businesses mentioned in Section 273 of this Code which are subject to different 
rates of tax, the gross sales or receipts of each business shall be separately 
reported for the purpose of computing the tax due from each business. 
SEC. 277. - Fees and C
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. The municipality may impose and collect 
such reasonable fees and charges on business and occupation and, except as reserved 
to the province in this Code, on the practice of any profession or calling, commensurate 
with the cost of regulation, inspection and licensing before any person may engage in 
such business or occupation, or practice such profession or calling. 
SEC. 278. - Fees for Sealing and Licensing of Weights and Measures. - (a) 
The municipality may levy fees for the sealing and licensing of weights and measures at 
such reasonable rates as shall be prescribed by the sangguniang bayan. 
(b) The sangguniang bayan shall prescribe the necessary regulations for the use 
of such weights and measures. The sanggunian concerned shall, by appropriate 
ordinance penalize fraudulent practices and unlawful possession or use of 
instruments of weights and measures and prescribe the criminal penalty 
therefore in accordance with the provisions of the Code. Provided, however, 
That the sanggunian concerned may authorize the municipal treasurer to settle 
as offense not involving the commission of fraud before a case therefore is filed 
in court , upon payment of a compromise penalty of not less than one thousand 
pesos (Php 1,000.00). 


79. - Fishey 
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and Charges. - (a) Municipalities shall 
have the exclusive authority to grant fishery privileges in the municipal waters and 
impose rentals, fees or charges therefor in accordance with the provisions of' this 
Sect ion. 
(b) The sangguniang bayan may: 
(1 ) Grant fishery privileges to erect fis, I corrals, oyster, mussels or other 
aquatic beds or bangus fry areas, within a definite zone of the municipal waters, 
as determined by it: Provided, however, That duly registered organizations and 
cooperatives of marginal fishermen shall have the preferential right to such 
fishery privileges: Provided, further, That the sangguniang bayan may require a 
public bidding in conformity with and pursuant to an ordinance grant of such 
privileges: Provided, finally, That in the absence of such organizations and 
cooperatives or their failure to exercise their preferential right, other parties may 
participate in the public bidding in conformity with the above cited procedure 
(2) Grant the privilege to gather, take or catch bangus fry, prawn fry or kawag- 
kawag or fry of other species and fish from the municipaJ waters by nets, traps or 
other fishing gears to marginal fishermen free of any rental, feelcharge or any 
other imposition whatsoever. 
(3) Issue for the operation of fishing vessels of three (3) tons or less for which 
purpose the sangguniang bayan shall promulgate rules and regulations regarding 
the issuance of such licenses to qualified applicants under existing laws: 
Provided, however, That the sanggunian concerned shall, by appropriate 
ordinance, penalize the use of explosives, noxious or puissance substances, 
electricity, muro-ami, and other deleterious methods of fishing and prescribe a 
criminal penalty therefore in accordance with the provisions of this Code: 
Provided, finally, That the sanggunian concerned shall the authority to prosecute 
any violation of the provisions of applicable fishery laws. 
SEC, 286. - 
itus of the Tax - (a) For the purpose of collection of the taxes 
under this Code businesses, maintaining or operating branch or sales outfet elsewhere 
shall record the sale in the branch or sales outlet making the sale or transaction, and 
the tax thereon shall accrue and shall be paid to the municipality where such branch or 
sales outlet in the city or municipality where the sale or transaction is made, the sale 
shall be duly recorded in the principal office and the taxes due shall accrue and shall be 
paid to such city or municipality. 
(b) The following sales allocation shall apply to businesses with factories project 


plants, and plantation in the pursuit of their business: 
( I )  Thirty percent (30%) of all sales recorded in the principal office 
shall be taxable by the city or municipality where the principal office is 
located, and 
(2) Seventy percent (70%) of all sales recorded in the principal office shall 
be taxable by the city or municipality where the factory, project office, 
plant, or plantation is located. 
0 
In case of a plantation located at a place other than the place where 
the factory is located said seventy percent (70%) mentioned in subparagraph (b) 
of subsection (2) above shall be divided as follows: 
(1) Sixty percent (60%) to the city or municipality where the factory 
is located; and 
(2) Forty percent(40%) to the city or municipality where the 
plantation is located. 
(c) In case where a business has two (2) or more factories, project offices, plants, or 
plantations located in different localities, the seventy percent (70%) mentioned in 
subparagraph (b) of subsection (2) above shall be prorated among the localities 
where the factories, project offices, and plantations are located in proportion to 
their respective volume or production during the period from which the tax is due. 
(f) The foregoing sales allocations shall be applied irrespective of whether or not 
sales are made in the locality where the factory, project offices, plant or 
plantation is located. 
EC. 289. - Scope of Taxing Powers. - The barangay may levy taxes, fees 
and charges, as provided in this Article, that shall exclusively accrue to them: 
(a) 
Taxes - On stores or retailers with fixed business establishment s having 
gross sales or receipts in the preceding calendar year of one hundred thousand 
pesos (Php100,000.00) 
or less, in the case of barangays in cities and 
municipalities within Metropolitan Manila Area and sixty thousand pesos (Php 
60,000.00) or less, in the case of barangays in other municipalities, at a rate not 
exceeding one percent ( I  %) on such gross sales or receipts. 
(b) 
Service Fee or Charges - barangays may collect reasonable fees or 
charges for services rendered in connection with the regulation or the use of 
barangay- owned properties or service facilities such as palay, copra, or tobacco 
dryers. 


0 
Barangay Clearance- NO city or municipality may issue any license or permit 
for any business or activity unless a clearance is first obtained from the barangay 
where such business or activity is located or conducted. For such clearance, the 
sangguniang barangay may impose a reasonable fee. 
The application for 
clearance shall be acted upon within seven (7) working days from the filling 
thereof. In the event that the clearance is not issued within the said period, the 
city or municipality may issue the said license or permit. 
(d) Other Fees and Charges. - The barangay may levy reasonable fees and 
charges: 
(I} 
On commercial breeding of fighting cocks, cockfighting and cockpits;. 
(2) On places of recreation which charge admission fees; and 
(3) On billboards, signboards, neon signs, and outdoor advertisements. 
Article Six. Common Revenue-Raising Powers 
SEC. 282. - Service Fees and Charges. - Local governments may impose and 
collect such reasonable fees and charges for services rendered. 
SEC. 283. - Public 
harges - Local governments may fix the rates for 
the operation of public utilities owned, operated and maintained by them within their 
jurisdiction. 
c. 
011 Fees or Charges - The sanggunian concerned may prescribe 
the terms and conditions anf fix the rates for the imposition of toll fees or charges for the 
use of any public road, pier or wharf, waterway, bridge, ferry or telecommunication 
system funded and constructed by the local government concerned: Provided, That no 
such toll fees or charges shall be collected from government vehicles and vehicles 
exclusively carrying officers and enlisted men of the Armed Forces of the Philippines or 
members of the Philippine National Police on mission, post office personnel delivering 
mail, physically-handicapped, disabled persons and senior citizens. 
even. Community Tax 
. - 285 - Community Tax - Cities or municipalities may levy a community 
tax in accordance with the provisions of this Article. 
C. - 286 -Individuals Liable to Community Tax - Every inhabitant of the 
Philippines eighteen (18) years of age or over who has been regularly employed on a 
wage or salary basis for at least thirty (30) consecutive working days during any 


calendar year, or who is engaged in business or occupation, or who owns real property 
with an aggregate assessed value of one thousand pesos (Php 1,000.00) or more, or 
who owns real property with an aggregate assessed value of one thousand pesos (Php 
1,000.00) or more, or who is required by taw to file an income tax return shall pay an 
annual community tax of five pesos (Php.5.00) and an annual additional tax of one peso 
(Php d.00) for every one thousand pesos (Php 1,000.00) of income regardless of 
whether from business, exercise of profession, employment or from property which in 
no case shall exceed five thausand pesos (Php 5,000.00). 
In the case of husband and wife, the additional tax herein imposed shall be 
based upon the total property owned by them and the total gross receipts or earning 
derived by them. 
SEC. - 287 
- 
Juaidical 
corporation no matter how created or organized, whether domestic or resident foreign, 
engaged in or doing business in the Philippines shall pay an annual community tax of 
five hundred pesos (Php 500.00) and an annual additional tax, which, on no case, shall 
exceed ten thousand pesos (Php l0,OOO.OO) in accordance with the following schedule. 
(I) 
For every five thousand pesos ( Php 5,000.00) worth of real property in the 
Philippines owned by it during the preceding year based on the valuation 
used for the payment for the real property tax under existing laws, found in 
the assessment rolls of the city or municipality where the real property is 
situated- two pesos (Php 2.00); and 
(2) For every five thousand pesos (Php 5,000.00) of gross receipts or earnings 
derived it from its business in the Philippines during the preceding year- two 
pesos (Php 2.00). 
The dividend received by a corporation from another corporation however shall, 
for the purpose of the additional tax, be considered as pari of the gross receipts or 
earnings of said corporation. 
SEC. 288 - Exemptions - The following are exempt from the community tax: 
(I ) Diplomatic and consular representatives; 
(2) Transient visitors and consular representatives; 
(3) Disabled persons; and 
(4) Senior citizens unless gainfully employed or engaged in businesses and 
earning more than sixty thousand pesos (Php 60,000.00) annually. 
SEC. 289 - Place sf 
~~~~~~~ 
-The community tax shall be paid in the place of 
residence of the individual, or in the place where the principal office of the juridical entity 
is located. 


community tax shall accrue on the first (Ist) 
day of January of each year which shall be 
paid not later than the last day of February of each year. If a person reaches the age of 
eighteen (I 
8) years or otherwise loses the benefit of exemption on or before the last day 
of June, he shall be liable for the community tax on the day he reaches such age or 
upon the day the exemption ends. However, if a person reaches the age of eighteen 
(18) years or loses the benefit of exemption on or before the last day of March, he shall 
have twenty (20) days to pay the community tax without being delinquent. 
Persons who come to reside in the Philippine or reach the age of eighteen (18) 
years on or after the first (1') day of July of any year, or who cease to belong to an 
exempt class on or after the same date, shall not be subject to the community tax for 
that year. 
(b) The corporation established and organized on or before the last day of June 
shall be liable for the community tax for that year. 
But corporations 
established and organized on or before the last day of March shall have 
twenty (20) days within which to pay the community tax without becoming 
delinquent. Corporations established and organized on or after the first day 
of July shall be subject to the community tax for that year. 
If the tax is not paid within the time prescribed above, there shall be added to the 
unpaid amount an interest of twenty-four percent (24%) per annum from the due date 
until it is paid. 
SEC. 294. - Community Tax Certificate. - A community tax certificate shall be 
issued to every person or corporation upon payment of the community tax. A community 
tax certificate may also be issued to any person or corporation not subject to the 
community tax upon payment of one peso (Php 1 .OO). 
SEC. 292. 
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Of COmmUflity Tax 
ertificate on Certain 
Occasions- (a) When an individual subject to the community tax acknowledges any 
document before a notary public, takes the oath of office upon election or appointment 
to any position in the government service, receives any license, certificate, or permit 
from any public authority; pays any tax or fee; receives any money from any public fund; 
transacts other official business; or receives any salary wage from any person or 
corporation, it shall be duty of any person, officer, or corporation with whom such 
transaction is made or business; done or from whom any salary or wage is received to 
require such individual to exhibit the community tax certificate. 
The presentation of community tax certificate shall not be required in connection 
with the registration of a voter. 


b) When, through its authorized officers, any corporation subject to the 
community tax receives any license, certificate, or permit from any public 
authority, pays and tax or fee, receives money from public funds, or transacts 
other official business, it shall be the duty of the public official with whom such 
transaction is made or business done, to require such corporation to exhibit the 
community tax certificate. 
0 
The community tax certificate required in the two preceding paragraphs shall 
be the one issued for the current year, except for the period from January until 
the fifteenth (‘l!jth) of April each year, in which case, the certificate issued for the 
preceding year shall suffice. 
SEC. 293. - Printing of @ommuni~ 
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and Distribution of 
Proceeds. - (a) The Bureau of Internal Revenue shall cause the printing of community 
tax certificates, distributes the same to the cities and municipalities through the city and 
municipal treasurers in accordance with prescribed regulations. 
The proceeds of the tax shall accrue to the general funds of the cities, 
municipalities and barangays except a portion thereof which shall accrue to the general 
fund of the national government in the proceeds of the tax within ten (IO) days after the 
end of each quarter. 
(6) The city or municipal treasurer shall deputize the barangay treasurer to 
collect the community tax in their respective jurisdictions. Provided, however, 
that said barangay treasurer shall be bonded in accordance with existing laws. 
0 
The proceeds of the community tax actually and directly collected by the 
city or municipal treasurer shall accrue entirely to the general fund of the city or 
municipality concerned. 
However, proceeds of the community tax collected 
through the barangay treasurers shall be apportioned as follows: 
(I) 
Fifty percent (50*%) shall accrue to the general fund of the city or 
municipality concerned; and 
(2) Fifty percent(50%) shall accrue to the barangay where the tax is collected. 
ight. Collection of Taxes 
- lax Period and 
a y ~ e n ~ .  
- Unless otherwise provided 
in this Code, the tax period of all local taxes, fees and charges shall be the calendar 
year. Such taxes, fees and charges may be paid in quarterly installments. 


5. - Accrual of Tax .. Unless otherwise provided in this Code, all local 
taxes, fees and charges shall accrue on the first (Ist) 
day of January of each year. 
However, new taxes, fees or charges, or changes in the rates thereof, shall accrue on 
the first (Ist) 
day of the quarter next following the effectivity of the ordinance imposing 
such new levies or rates. 
SEC. 296. - rime sf 
. - Unless otherwise provided in this Code, of 
local taxes, fees and charges shall be paid within the first twenty (20) days of January or 
of each subsequent quarter, as the case may be. The sanggunian concerned may, for 
a justifiable reason or cause, extend the time of payment of such taxes, fees, or 
charges without surcharges or penalties, but only for a period not exceeding six (6) 
months. 
urcharges and Penalties on Unpaid Taxes or Charges. - The 
Sanggunian may impose a surcharge not exceeding twenty-five percent (25%) of the 
amount of taxes, fees or charges not paid on time and an interest at the rate not 
exceeding two percent (2%) per month of the unpaid taxes, fees or charges including 
surcharges, until such’amount is fully paid but in no case shall the total interest on the 
unpaid amount or portion thereof exceed thirty-six(36) months. 
SEC. 298. - Interest: on Other Unpaid Revenues. - Where the amount of any 
other revenue due a local government, except voluntary contributions or donations, is 
not paid on the date fixed in the ordinance, or in contract, expressed or implied, or upon 
the occurrence of the event which has given rise to its collection, there shall be 
collected as part of that amount an interest thereon at the rate not exceeding two 
percent (2%) per month from the date it is due until it is paid, but in no case shall the 
total interest on the unpaid amount or a portion thereof exceed thirty-six (36 months. 
SEC. 299. - Collection of Local Revenues by Treasurer.- All taxes, fees, and 
charges shall be collected by the provincial, city, municipal, or barangay treasurer, or 
their duly authorized deputies. 
The provincial, city or municipal treasurer may designate the barangay treasurer 
as his deputy to collect local taxes, fees or charges. In case a bond is required for the 
purpose, the provincial, city or municipal government shall pay the premiums of bond 
that may be required under this Code. 


xamination C B ~  oak of Accounts and 
ecords by Local Treasurer. - The provincial, city, municipal or barangay treasurer 
may, by himself or through any of his deputies duly authorized in writing, examine the 
books, accounts, and other pertinent records of any person, partnership, corporation, or 
association subject to local taxes, fees and charges in order to ascertain, assess and 
collect the current amount of the tax, fee or charge. Such examination shall be made 
during regular business hours, only once for every tax period, and shall be certified to 
by the examining official. Such certificate shall be made of record in the books of 
accounts of the taxpayer examined. 
In case the examination herein authorized is made by a duly authorized deputy of 
the local treasurer, the written authority of the deputy concerned shall specifically state 
the name, address, and business of the taxpayers whose books, accounts and pertinent 
records are to be examined, the date and place of such examination, and the procedure 
to e followed in conducting the same. 
For this purpose, the records of the revenue district office of the Bureau of 
Internal Revenue shall be made available to the local treasurer, his deputy or duly 
authorized representative. 
Such business records shall be treated as confidential 
unless otherwise ordered by the Court. 
Article Mine. Civil Remedies for Collection of Revenues 
SEC. 301. - Application of Chapter. - The provisions of this Article and the 
remedies provided herein may be availed of for the collection of any delinquent local 
tax, fee, charge, or other revenue. 
SEC 302. - Local Government’s Lien - Local taxes, fees, charges and other 
revenue constitute a lien, superior to al liens, charges or encumbrances in favor of any 
person, enforceable by appropriate administrative or judicial action, not only upon any 
property or rights therein which may be subject to the lien but also upon property used 
in business, occupation, practice of profession or calling, or exercise of privilege with 
respect to which the lien is imposed. The lien may only be extinguished upon full 
payment of the delinquent local taxes fees and charges including related surcharges 
and interest. 
SEC. 303. - 
emedies. -The civil remedies for the collection of local 
taxes, fees or, and surcharges and interest resulting from delinquency shall be: 
(a) By administrative action thru distraint of goods, chattels, or effects, and other 
personal of whatever character, including stocks and other securities, debts, 


credits, bank accounts, and interest in and rights to personal property, and 
by levy upon real property and interest in or rights to real property; and 
(b) By judicial action. 
Either of these remedies or at! may be pursued 
concurrently or at the discretion of the local government concerned. 
SEC. 304, - Distraint of Personal Property - The remedy by distraint shall 
proceed as follows: 
(a) Seizure- Upon failure of the person owing any local tax, fee, or charge to pay 
the same at the same time required, the local treasurer or his deputy may, 
upon written noticed, seize, or confiscate any personal property belonging to 
the person or any personal property subject to the 19en in sufficient quantity 
to satisfy the tax, fee, or charge in question, together with any increment 
thereto incident to delinquency and the expenses of seizure. In such case, 
the local treasurer or his deputy shall issue a duly authenticated certificate 
based upon the records of his office showing the fact of delinquency and the 
amounts of the tax, fee or charges and penalty due. Such certificate shall 
serve as sufficient warrant for the distraint of personal property 
aforementioned, subject to the taxpayer's right to claim exemption under the 
provision of existing laws. Distrained personal property shall be sold at a 
public auction in the manner herein provided for. 
(b) Accounting of distrained goods.-The officer executing the distraint shall make 
or cause to be made an account of the goods, chattels or effects distrained, a 
copy of which signed by himself shall be either with the owner or person from 
whose possession the goods, chattels or effects are taken, or at the dwelling 
or place.of business of that person and with someone of suitable age and 
discretion, to which list shall be added a statement of the sum demanded and 
a note of the time and place of sale. 
(c) Publication- The officer shall forthwith cause a notification to be exhibited in 
not less than three (3) public and conspicuous places in the territory of the 
local government where the distraint is made, specifying the time and place 
of sale, and the articles distrained. The time of the sale shall not be less than 
twenty (20) days after the notice to the owner or possessor of the property as 
above specified and the publication or posting of the notice. One place for 
the posting of notice shall be at the office of the chief executive of the local 
government in which the property is distrained. 
(d) Rekase of distrained property upon payment prior to sale - if at any time 
prior to the sale, all the proper charges are paid to the officer conducting the 
sale, the goods or effected distrained shall be restored to the owner. 


(e) Procedure of Sale - At the time and place fixed in the notice, the officer 
conducting the sale sell the goods or effects so distrained at public auction1 
to the highest bidder for cash. Within five (5) days after the sale, the local 
treasurer shall make a report of the proceedings in writing to the local chief 
executive concerned. 
Should the property distrained be not disposed of within one hundred twenty (120) days 
from the date of distraint, the same shall be considered as sold to the local government 
concerned for the amount of the assessment made thereohn by the Committee on 
Appraisal and to the extent of the same amount, the tax delinquencies shall be 
cancelled. Said committee on Appraisal shall be composed of the city or municipal 
treasurer as chairman, with a representative of the Commission on Audit and the city or 
municipal assessor as members. 
(f) Disposition of Proceeds - The proceeds of the sale shall be applied to satisfy 
the tax, including the surcharges, interest, and other penalties incident ot 
delinquency, and the expenses of the distraint and sale, The balance over 
and above what is required to pay the entire claim shall be returned to the 
owner of the property sold. The expenses chargeable upon seizure and sale 
shall embrace only the actual expenses of seizure and preservation of the 
property pending the sale, and no charge shall be imposed for the services of 
the local officer or his deputy. Where the proceeds of the sale are insufficient 
to satisfy the claim, other property may, in like manner, be distrained until 
the full amount due, including all expenses, collected. 
SEC. 305 - Levy on Real Prope 
- After the expiration of the time required 
paying the tax, fee, or charge, real property may be levied on before, simultaneously, or 
after the distraint of personal property belonging to the delinquent taxpayer. To this 
end, the provincial, city or municipal treasurer, as the case maybe, shall prepare a duly 
authenticated certificate showing the name of the taxpayer and the amount of the tax, 
fee or charge, and penalty due from him. Said certificate shall operate with the force of 
a legal execution throughout the Philippines. Levy shall be effected by writing upon said 
certificate the description of the property upon which levy is made. At the same time, 
written notice of the levy shall be mailed to or seved upon the assessor and the Register 
of Deeds of the province or city where the property is located who shall annotate the 
levy on the tax declaration and certificate of title of the property, respectively , and the 
delinquent taxpayer, or, if he be absent from the Philippines, to his agent or the 
manager of the business in respect to which the liability arose, or if there be none, to the 
occupant of the property in question. 


In case the levy on real property is not issued before or simultaneously with the 
warrant of distraint on personal property, and the personal property of the taxpayer is 
not sufficient to satisfy his delinquency, the provincial , city, or municipal treasurer, as 
the case may be, shall within thirty (30) days after execution of the distraint, proceed 
with the levy on the taxpayer’s real property. 
A report on any levy shall, within ten (IO) days after receipt of the warrant, be 
submitted by the levying officer to the sanggunian concerned. 
SEC. 306. - Penalty for Faiiure to Issue and Execute ~ a ~ r a ~ t  
- Without 
prejudice to criminal under the Revised Penal Code and other applicable laws, any local 
treasurer who fails to issue or execute the warrant of distraint or levy after the expiration 
of the time prescribed , or who is found guilty of abusing the exercise thereof by 
competent authority shall be automatically dismissed from the service after due notice 
and hearing. 
- Advertisement and Sale - Within thirty (30) days after levy, the 
local treasurer proceed to publicly advertise for sale or auction the property or a usable 
portion thereof as may be necessary to satisfy the claim and cost of sale; and such 
advertisement shall cover a period of at least thirty (30) days. it shall be effected by 
posting a notice at the main entrance of the municipal building or city hall, and in a 
public and conspicuous place in the barangay where the real property is located, and by 
publication once a week for three (3) weeks in a newspaper of general circulation in the 
province, city or municipality where the property is located. The advertisement shall 
contain the amount of taxes, fees, or charges, and penalties due thereon, and the time 
and place of sale, the name of the taxpayer against whom the taxes , fees, or charges 
are levied, and a short description of the property to be sold. At any time before the date 
fixed for the sale, the taxpayer may stay the proceedings by paying the taxes, fees, 
charges, penalties and interests. If he fails to do so, the sale shall proceed and shall be 
held either at the main entrance of the provincial, city, or municipal building, or on the 
property to be sold, or at any other place as determined by the local treasurer 
conducting the sale and specified in the notice of sale. 
Within thirty (30) days after the sale, the local treasurer or his deputy shall make 
a report of the sale to the sanggunian concerned, and which shall form part of his 
records. After consultation with the sanggunian, the local treasurer shall make and 
deliver to the purchaser a certificate of sale, showing the proceedings of the sale, 
describing the property sold, stating the name of the purchase and setting out the exact 
amount of all taxes, fees, charges, and related surcharges, interests, or penalties. 


Provided, however, That any excess in the proceeds of the sale over the claim and cost 
of sales shall be turned over to the owner of the propedy. 
The local treasurer may, by ordinance duly approved, advance an amount 
sufficient to defray the costs of collection by means of the remedies provided for in this 
Title, including the preservation or transportation in case of personal property , and the 
advertisement and subsequent sale in cases of personal and real property including 
improvements thereon. 
SEC. 308. - Redemption of Properly old - Within one (I) 
year from the date 
of sale, the delinquent taxpayer or his representative shall have right to redeem the 
property upon payment to the local treasurer of the total amount of taxes, fees, or 
charges, and related surcharges, interests or penalties from the date of delinquency to 
the date of sale, plus interest of not more than two percent (2%) per month on the 
purchase price from the date of purchase to the date of redemption. Such payment shall 
invalidate the certificate of sale issued to the purchaser and the owner shall be entitled 
to a certificate of redemption from the provincial, city ,or municipal treasurer or his 
deputy. 
The provincial, city, or municipal treasurer or his deputy, upon surrender by the 
purchaser of the certificate of sale previously issued to him, shall forthwith return to the 
latter the entire purchase price paid by him plus the interest of not more than two 
percent (2%) per month herein provided for, the portion of the cost of sale and other 
legitimate expenses incurred by him, and said property thereafter shall be free from the 
lien of such taxes, fees, or charges, related surcharges, interests, and penalties. 
The owner shall not , however, be deprived of the possession of said property 
and shall be entitled to the rentals and other income thereof until the expiration of the 
time allowed for its redemption. 
SEC. 309. - Final Deed to Purck 
er. - In case the taxpayer fails to redeem 
the property as provided herein, the local treasurer shall execute a deed conveying to 
the purchaser so much the property as has been sold, free from liens of any taxes, fees, 
charges, related surcharges. Interests and penalties. The deed shall succinctly recite 
all the proceedings upon which the validity of the sale depends. 
SEC. 310. - Purchase of Property by the Local Governments for Want of 
Bidder. - In case there is no bidder for the real property advertised for sale as 
provided herein, or if the highest bid is for an amount insufficient pay the taxes, fees or 
charges, related surcharges, interests, penalties and costs, the local treasurer 
conducting the sale shall purchase the property in behalf of the local government 
concerned to satisfy the claim and within two (2) days thereafter shall make a report of 
his proceedings which shall be reflected upon the records of his office. It shall be the 
duty of the Register Of Deeds concerned upon registration with his office of any such 


declaration of forfeiture to transfer the title of the forfeited property to the local 
government concerned without the necessity of an order from a competent court. 
Within one (I) 
year from the date of such forfeiture, the taxpayer or any of his 
representative, may redeem the property by paying to the local treasurer the 
full amount of the taxes, fees, charges, and related surcharges, interests or penalties, 
and the costs of sale. 
If the property is not redeemed as provided herein, the 
ownership thereof shall be fully vested of the local government concerned. 
The sanggunian may, by ordinance duly approved, and upon notice of not less than 
twenty (20) days, sell and dispose of the real property acquired under the preceding 
section at public auction. The proceeds of the sale shall accrue to the general fund of 
the local government concerned. 
SEC. 311. - 
esaile of Real Estate Taken for Taxes, Fees, or Charges . - 
SEC. 312. .- 
Collection Qf Delinquent Taxes, Fees, Charges or Other 
Revenues Through Judicial Action. - The local government concerned may enforce 
the collection of delinquent taxes, fess, charges, or other revenues by civil action in any 
court of competent jurisdiction. The civil action shall be filed by the local treasurer within 
the period prescribed in this Code. 
SEC. 313. . Further Distraint or Levy - The remedies by distraint and levy 
may be repeated if necessary until the full amount due, including all expenses, is 
collected. 
SEC. 314. - 
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from Distraint or Levy. - The 
following property shall be exempt from distraint and the levy, attachment or execution 
thereof for delinquency in the payment of any local tax, fee or charge, including the 
related surcharge and interest: 
(a) Tools and the implements necessarily used by the delinquent taxpayer in his 
(b) One (I) horse, cow, carabao, or other beast of burden, such as the 
delinquent taxpayer may select, and necessarily used by him in his ordinary 
occupation; 
(c) His necessary clothing, and that of all his family; 
(d) Household furniture and utensils necessary for housekeeping and used for 
that purpose by the delinquent taxpayer, such as he may select, of a value 
not exceeding ten thousand pesos (Php 10,000.00). 
sufficient for four (4) months; 
trade or employment; 
(e) Provisions, including crops, actually provided for individual or lfamily are 
, 


(f) The professional libraries of doctors, engineers, lawyers and judges; 
(9) One fishing boat and net, not exceeding the total value of ten thousand 
pesos (Php 10,000.00) by the lawful use of which a fisherman earns his 
livelihood; and 
(h) Any material or article forming part of a house or improvement of any real 
property. 
SEC. 315. - Power to Levy Other Taxes, Fees or Charges- Local 
governments may exercise the power to levy taxes, fees or charges on any base of 
subject not otherwise specifically enumerated herein or taxed under the provisions of 
the National Internal Revenue Code, as amended, or other applicable laws: Provided, 
That the taxes, fees, or charges shall not be unjust, excessive, oppressive, confiscatory 
or contrary to declared national policy: Provided, further, That the ordinance levying 
such taxes, fees or charges shall be enacted without any prior public hearing conducted 
for the purpose. 
SEC. 346. - Procedure for Approval and Effectivity of Tax Ordinances and 
Revenue Measures; Mandatory Public Hearings. - The procedure for approval of 
local tax ordinances and revenue measures shall be in accordance with the provisions 
of this Code; Provided, That public hearings shall be conducted for the purpose prior to 
the enactment thereof: Provided, however, That such appeal shall not have the effect of 
suspending the effectivity of the ordinance and the accrual and payment of the tax, fee, 
or charge levied therein: Provided, finally, That thirty (30) days after receipt upon the 
appeal, the aggrieved party may file appropriate proceedings with a court of competent 
jurisdiction. 
SEC. 317 - Publication of Tax Ordinances and Revenue easarres. -Within 
ten ( I O )  days after their approval, certified true copies of all provincial, city, and 
municipal tax ordinances or revenue shall be published in full for three (3) consecutive 
days in daily a newspaper published and circulated or once a week for three (3) 
consecutive weeks in the case of a weekly newspaper published and circulated locally, 
the same shall instead be posted for at least one (I) 
month in provincial capitols, city or 
municipal halls, all barangay halls and other conspicuous and publicly accessible 
p I aces. 


c. 418 
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of 
Measures. - Copies of all provincial, city, and municipal and barangay tax ordinances 
and revenue measures shall be furnished the respective local treasurers for public 
dissemination. 
rdinances and 
Revenue Measures. - The enforcement of any tax ordinance or revenue measure 
after due notice of the disapproval or suspension thereof made by Secretary of Justice 
shall be sufficient ground for administrative disciplinary action against the local officials 
and employees responsible therefor. 
SEC. 320 - 
Authority of Local 
o v ~ ~ ~ ~ ~ n t s  
to 
ates of Tax 
Ordinances. - Local governments shall have the authority to adjust the tax rates as 
prescribed herein not oftener than one every five (5) years, but in no case shall such 
adjustment exceed ten percent (10%) of the rates fixed under this Code. 
In he case of fixed taxes prescribed in his Code; the maximum allowable rate 
may be adjusted not more than once every three (3 ) years based on the average 
annual inflation rate as certified by the National Statistics Office. 
EC. 321. - Authority to Grant Tax ~
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Privileges. - 
Unless 
otherwise provided in this Code, tax exemptions or incentives granted to, or presently 
enjoyed by all persons, whether natural or juridical, including government-owned or- 
controlled corporations, except local water districts, cooperatives duly registered under 
R.A. 6938, non-stock and non-profit hospitals and educational institutions, are hereby 
withdrawn upon the effectivity of this Code. 
EC. 322 - Withdrawal of Tax Exemption Privileges . - Unless otherwise 
provided in this Code, tax exemptions or incentives granted to, or presently enjoyed by 
all persons, whether natural or juridical, including government-owned- or controlled 
corporations, except local water districts, cooperatives, duly registered under R.A. 6938, 
non-stock and non-profit hospitals and educational institutions are hereby withdrawn 
upon effectivity of this Code. 
Article Eleven, Taxpayer’s 
3. Periods of Assessment and Collection. - {a) Local taxes, fees, or 
charges shall be assessed within five (5) years from the date they became due. No 
action for the collection of such taxes, fees, or charges , whether administrative or 
judicial, shall be instituted after the expiration of such period: Provided, That taxes, fees 


or charges which have accrued before the effectivity of this Code may be assessed 
within a period of three (3) years from the date they become due. 
(c) In case of fraud or intent to evade the payment of taxes, fees or charges, the 
same maybe assessed within “1 0” years from discovery of the fraud or intent 
to evade payment. 
(d) Local taxes, fees, or charges may be collected within five (5) years from the 
date of by or judicial action. No such action shall be instituted after the 
expiration of said period; Provided, however That taxes, fees or charges 
assessed before the effectivity of this Code may be coilected within a period 
of three (3) years from the date of assessment. 
(e) The running of the periods of prescription provided in the preceding 
paragraphs shall be for the time during which: 
(1) The treasurer is legally prevented from making the assessment of 
collection; 
(2) The taxpayer requests for a reinvestigation and executes a waiver in 
writing before expiration of the period within which to assess or 
collect; and 
(3) The taxpayer is out of the country or otherwise cannot be located. 
EC. 324. - Protest of Assessment. - When the focal treasurer or his duly 
authorized representative finds that correct taxes, fees, or charges have not been paid, 
he shall issue a notice of assessment stating the nature of the tax, fee or charge, the 
amount of deficiency, the surcharges, interests, and penalties. Within (60) days from the 
receipt of the notice of assessment, the taxpayer may file a written protest with the local 
treasurer contesting the assessment; otherwise, the assessment shall become final and 
executory. The local treasurer shall decide the protest within thirty (30) days from the 
time of its filing. If the local treasurer finds the protest to be wholly or partly meritorious, 
he shall issue a notice canceling wholly or partly correct, be shall deny the protest 
wholly or partly with notice to the taxpayer. The taxpayer shall have thirty (30) days 
from the receipt of the denial of the protest or from the lapse of the thirty (30) days 
period prescribed herein, within which to appeal with the court of competent jurisdiction 
otherwise the assessment become conclusive and unappealable. 
EC. 325. Clai 
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-No case or proceeding shall be 
maintained in any court for the recovery or any tax, fee, or charge erroneously or 


illegally collected until a written claim for refund or credit has been filed with the local 
treasurer. No case or preceding shall be entertained in any court after the expiration of 
two (2) years from the date of the payment of such tax, fee, or charge, or from the date 
the taxpayer is entitled to a refund or credit. 
Chapter 
Real Property Taxation 
rticle One: General Provisions 
SEC. 326. Scope - This title shall govern the administration, appraisal, 
assessment, levy and collection of the real property tax; 
ec. 327. - Fundamental rinciples. - The appraisal, assessment, levy and 
collection of real property tax shall be guided by the following fundamental principles. 
(a) Real Property shall be appraised at its current and fair market value. 
(b) Real property shall be classified for assessment purposes on the basis of its 
actual use; 
(c) Real property shall be assessed on the basis of a uniform classification within 
each local government; 
(d) The appraisal and assessment of real property shall be equitable. 
SEC. 328. Definition of Terms. - When used in this Chapter: 
(a) “Acquisition Cost” for newly acquired machinery not yet depreciated and 
appraised with in the year of its purchase, refers to the actual cost of the 
machinery to its present owner, plus the cost of transportation, handling, and 
installation of the present site; 
(b) “Actual Use” refers to the purpose for which the property is principally 
predominantly utilized by the person in possession thereof; 
(c) “Ad Valorem Tax” is a levy on real property determined on the basis of a fixed 
proportion of the value of the property; 
(d) “Agricultural land” is land devoted principally to the planting of trees, raising of 
crops, livestock and poultry, dairying, salt making, inland fishing and similar 
aquacultural activities, and other agricultural activities, and is not classified as 
mineral, timber, residential, commercial or industrial land; 


(e) “Appraisal” is the act or process of determining the value of property as of a 
specific date for a specific purpose; 
(f) “Assessment” the act or process of determining the value of a property, or 
proportion thereof subject to tax, including the discovery, listing, classification, 
and appraisal of properties; 
(9) “Commercial land” is land devoted principally for the object of profits and is 
not classified as agricultural, industrial, mineral, timber, or residential land; 
(h) “Depreciated Value” is the value remaining after deducting depreciation from 
the acquisition cost; 
(i) “Economic life” is the estimated period over which it is anticipated that a 
machinery or equipment may be profitably utilized; 
(j) “Fair market Value” is the price at which a property may be sold by a seller 
who is not compelled to sell and bought by a buyer who is not compelled to 
buy; it is synonymous to taxable value; 
(k) “Improvement is a valuable addition made to a property or an amelioration in 
its condition, amounting to more than a mere repair or replacement of parts 
involving capital expenditures and labor, which is intended to enhance its 
value, beauty or utility or to adapt it for new or further purposes; 
(I) “Industrial land” is land devoted principally to industrial activity as capital 
investment and is not classified as agricultural, commercial, timber, mineral or 
residential land; 
(m)“Machinery” embraces machines, equipment, mechanical contrivances, 
instruments, or apparatus, which may or may not be attached, permanently or 
temporarily, to the real property. 
It includes the physical facilities for 
production, installations and appurtenant service facilities, those which are 
mobile, self-powered or self-propelled, and those not permanently attached to 
the real property which are actually, directly, and exclusively used to meet the 
needs of.the particular industry, business, or activity and which by their very 
nature and purpose are designed for, or necessary to its manufacturing, 
mining, logging, commercial, industrial or agricultural purposes. 
(n) “Mineral Lands” are lands in which minerals, metallic or non-metallic, exist in 
sufficient quantity or grade to justify the necessary expenditures to extract 
and utilize each material; 


(0) “Reassessment” is the assigning of new assessed values to property, 
particularly real estate, as the result of a general, partial, or individual 
reappraisal of the property; 
(p) “Remaining Economic Life” is the period of time expressed in years from the 
date of appraisal to the date when the machinery becomes valueless; 
(9) “Remaining Value” is the value corresponding to the remaining useful life of 
the machinery; 
(r) “Replacement or Reproduction Cost” is the cost that would be incurred on the 
basis of current prices, in acquiring an equally desirable substitute property, 
or the cost of reproducing a new replica of the property on the basis of 
current prices with the same or closely similar material; and 
(s) “Residential land” is land principally devoted to habitation. 
SEC. - 329. 
dministration of the Real Property Tax. - The provinces and 
cities, including the municipalities within Metropolitan Manila Area, shall be primarily 
responsible for the proper, efficient and effective administration of the real property tax, 
subject to 
the supervision and control of the respective Regional Government: 
Provided, however, That when the average real property tax collection efficiency of the 
entire province or city or of a municipality in Metropolitan Manila within any three (3) 
consecutive fiscal years is less than seventy percent (70%), real property tax 
administration particularly the assessment and collection aspects thereof shall be 
transferred to the Regional Government concerned, in accordance with implementing 
and operational details promulgated pursuant to Section 531 of this Code: Provided, 
finally, That the proceed of the real property tax shall continue to accrue to the province, 
city or municipality involved as prescribed in this Code which in no case shall suffer any 
decrease or diminution of income from said tax as a consequence of this provision. 
EX. 330. Appraisal of Real Propeirty. - All real property, whether taxable or 
exempt, shall be appraised and assessed at the current and fair market value prevailing 
in the locality where the property is situated. Within one (I) 
year after the effectivity of 
this Act, the Department of Finance, jointly with the Leagues of Provinces, Cities and 
Municipalities and Liga ng mga barangay, shall promulgate the rules and regulations 
necessary for the installation of an efficient, effective, and transparent system of 
classification, appraisal and assessment of real property pursuant to the provisions of 


this Code: Provided, That until such rules and regulations are promulgated, the 
applicable law, rules and regulations shall continue to apply. 
eal Property Identification 
tern. - All declarations of real 
property made under the provisions of this Chapter shall be kept and filed under a 
uniform classification system to be established by the provincial, city or municipal 
assessor. 
SEC. 332. Duty of egistrar of Deeds to 
Listed in Registry. - (a) To ascertain whether or not any real property entered in the 
Registry of Property has escaped discovery and listing for the purpose of taxation, The 
Register of Deeds shall prepare and submit to the provincial, city or municipal assessor, 
within six (6) months from the date of effectivity of this Code and every year thereafter, 
an abstract of his registry, which shall include brief but sufficient description of the real 
properties entered therein, their present owners, and the dates of their most recent 
transfer or alienation accompanied by copies of corresponding deeds of sale, donation, 
or partition or other forms of alienation. 
(b) It shall also be the duty of the Registrar of Deeds to require every person who 
shall present for registration a document of transfer, alienation, or encumbrance 
of real property to accompany the same with a certificate to the effect that the 
real property subject of the transfer, alienation, or encumbrance, as the case 
may be, has been fully paid of all real property taxes due thereon. Failure to 
provide such certificate shall be a valid cause for the Registrar of Deeds to 
refuse the registration of the document. Any Registrar of Deeds who 
intentionally and deliberately fails to perform such duties and who is found guilty 
in an administrative proceeding shall be dismissed from the service, without 
prejudice to criminal prosecution under the revised Penal Code and other 
applicable laws. 
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or Certificate of 
Registration of Machinery to Transmit Copy to Assessor. - Any public official or 
employee who may now or hereafter be required by law or regulation to issue to any 
person a permit for the construction, addition, repair, or renovation of a building, or 
permanent improvement on land, or a certificate of registration for any machinery, 
including machines, mechanical contrivances, and apparatus attached or affixed on 
land or to another real property, shall transmit a copy of such permit or certificate within 
thirty (30) days of its issuance, to the assessor of the province, city or municipality 
where the property is situated. 


Any building official who intentionally and deliberately fails io perform such duties 
and who is found guilty in an administrative proceeding shall be dismissed from the 
service, without prejudice to criminal prosecution under the revised Penal Code and 
other applicable laws. 
Assessor. - It shall be the duty of all geodetic engineers, public or private, to furnish 
free of charge to the assessor of the province, city or municipality where the land is 
located with a white or blue print copy of each of all approved original or subdivision 
plans or maps of surveys executed by them within thirty (30) days from receipt of such 
plans from the Lands Management Bureau, the Land Registration Authority, or the 
Housing and Land Use Regulatory Board, as the case may be. 
Any Geodetic Engineer who intentionally and deliberately fails to perform such 
duties shall, upon conviction, be punished by a fine of not less than five hundred pesos 
(Php500.00) nor more than five thousand pesos (Php5,000.00) or imprisonment of not 
less than one (I) 
month nor more than six (6) months, or both such fine and 
imprisonment, at the discretion of the Court. 
reparation of Schedule of Fair ~
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- Before any 
general revision of property assessment is made pursuant to the provisions of this 
Chapter, there shall be prepared a schedule of fair market values by the provincial, city 
and the municipal assessors of the municipalities within the Metropolitan Manila Area 
for the different classes of real property situated in their respective local governments. 
The schedule of the fair market values shall be published in a newspaper of 
general circulation in the province, city or municipality concerned, or in the absence 
thereof, shall be posted in the provincial capitol, city or municipal hall and in two other 
conspicuous public places therein. 
. Creation of a 
purposes of Section 335 and Section 337 of this Code, there shall be created a 
Regional Technical Valuation Committee attached to the Regional Government, which 
shall review and approve the prepared schedule of Fair Market Values. Said Committee 
shall be composed of all Provincial and City Assessors, and one Representative each 
from the Bankers Association of the Philippines, Bureau of Internal Revenue and The 
Association of Realtors within the Region. 


and ~~~~~~~y 
The provincial, city or municipal assessor shall undertake a general revision of real 
property assessments within three (3) years after the effectivity of this Act and every five 
(5) years thereafter. 
SEC. 338. Valuation of 
~~~~~~. 
- In cases where (a) real property is 
declared and listed for taxation purposes for the first time; (b) there is an ongoing 
general revision of property classification and assessment; or (c) a request is made by 
the person in whose name the property is declared, the provincial, city or municipal 
assessor or his duly authorized deputy shall, in accordance with the provisions of this 
Chapter, make a classification, appraisal and assessment of the real property listed and 
described in the declaration irrespective of any previous assessment or taxpayer's 
valuation thereon: Provided, however, That the assessment of real property shall not be 
increased oftener than once every three (3) years except in case of new improvements 
substantially increasing the value of said property or of any change in its actual use. 
SEC. 339. Date of  ti^^^ of A ~ ~ e ~ § ~ ~ n t  
or 
eassessment. - All 
assessments or reassessments made after the first (Ist) 
day of January of any year 
shall take effect on the first (IS*) 
day of January of the succeeding year: Provided, 
however, That the reassessment of real property due to its partial or total destruction, or 
to a major change in its actual use, or to any great and sudden inflation or deflation of 
real property value$, or to the gross illegality of the assessment when made or to any 
other abnormal cause, shall be made within ninety (90) days from the date any such 
cause or causes occurred, and shall take effect at the beginning of the quarter next 
following the reassessment. 
ssessment sf 
. - Real property 
declared for the first time shall be assessed for taxes for the period during which it 
would have been liable but in no case for more than ten ( I O )  years prior to the date of 
initial assessment: Provided, however, That such taxes shall be computed on the basis 
of the applicable schedule of values in force during the corresponding period. If such 
taxes are paid on or before the end of the quarter following the date the notice of 
assessment was received by the owner or his representative, no interest for 
delinquency shall be imposed thereon; otherwise, such taxes shall be subject to an 
interest at the rate of two percent (2%) per month or a fraction thereof from the date of 
the receipt of the assessment until such taxes are fully paid. 


SEC. 34.4. Notification of New or 
is assessed for the first time or when an existing assessment is increased or decreased, 
the provincial, city or municipal assessor shall within thirty (30) days give written notice 
of such new or revised assessment to the person in whose name the property is 
declared. The notice may be delivered personally or by registered mail or through the 
assistance of the punong barangay to the last known address of the person to be 
served. 
SEC. 342. A ~ ~ r a ~ ~ a ~  
and Asse 
achinery. - (a) The fair market 
value of a brand-new machinery shall be the acquisition cost. In all other cases, the fair 
market value shall be determined by dividing the remaining economic life of the 
machinery by its estimated economic life and multiplied by the replacement or 
reproduction cost. 
(b) If the machinery is imported, the acquisition cost includes freight, 
insurance, bank and other charges, brokerage, arrastre and handling, duties 
and taxes, plus cost of inland transportation, handling, and installation 
charges at the present site. The cost in foreign currency of imported 
machinery shall be converted to peso cost on the basis of foreign currency 
exchange rates as fixed by the Banko Sentral ng Pilipinas. 
SEC. 343. Depreciation Ilowance for ~
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- For purposes of assessment, 
a allowance shall be made for machinery at a rate not exceeding five percent (5%) of its 
original cost or its replacement or reproduction cost, as the case may be, for each year 
of use: Provided, however, That the remaining value for all kinds of machinery shall be 
fixed at not less than twenty percent (20%) of such original, replacement, or 
reproduction cost for so long as the machinery is useful and in operation. 
oard of Assessment Appeals. - Any owner or person 
having legal interest in the property who is not satisfied with the action of the provincial, 
city or municipal assessor in the assessment of his property may, within sixty (60) days 
from the date of receipt of the written notice of assessment, appeal to the Regional 
Board of Assessment Appeals, which is hereby created in lieu of Central Board of 
Assessment, by filing a petition under oath in the form prescribed for the purpose, 
together with copies of the tax declarations and such affidavits or documents submitted 
in support of the appeal. The Board concerned shall decide the appeal within one 
hundred twenty (I 
20) days from the date of Receipt of such appeal. 


rgamimatiors, Functions and owers of the ~~~~~~a~ 
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Appeals. - (a) The Board of Assessment Appeals shall be composed of 
the Chairman of the Regional Government as Chair; the Regional Director of the 
Bureau of Internal Revenue, and the Governor or Mayor of the province or city, as the 
case may be, where the property is located. 
SEC. 346. Acfion by the 
ppeals. - @)The 
Board shall decide the appeal within one hundred twenty (120) days from the date of 
receipt of such appeal. The Board, after hearing, shall render its decision based on 
substantial evidence or such relevant evidence on record as a reasonable mind might 
accept as adequate to support the conclusion. 
(b) In the exercise of its appellate jurisdiction, the Board shall have the power to 
summon witnesses, administer oaths, conduct ocular inspection, take 
depositions, and issue subpoena and subpoena duces tecum. The proceedings 
of the Board shall be conducted solely for the purpose of ascertaining the facts 
without necessarily adhering to technical rules applicable in judicial proceedings. 
(c) The secretary of the Board shall furnish the owner of the property or the person 
having legal interest therein and the provincial or city assessor with a copy of 
the decision of the Board. The decision of the Board shall be final and 
executory. 
7. Authority to 
ea1 Property Tax Incemtives. - Provinces and 
cities may, through an Ordinance, Grant Real Property Tax Incentives for the purpose of 
promoting or encouraging investments in their jurisdictions, subject to such Terms and 
Conditions as such Ordinance may prescribe: Provided, That the duration of such 
incentives shall not exceed five (5) years from the date of the effectivity of the approved 
Ordinance granting said incentive: Provided, further, That such incentive shall be 
availed only once. . 
SEC. 348. Effect of Appeal on the ~a~~~~~ of 
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Tax. - Appeals 
on assessments of real property made under the provisions of this Code shall, in no 
case, suspend the collection of the corresponding realty taxes on the property involved 
as assessed by the provincial or city assessor, without prejudice to subsequent 
adjustment depending upon the final outcome of the appeal. 


SE 
ewer to Levy Weal Pro erty Tax. - A province or city or a 
municipality within the Metropolitan Manila Area may levy an annual ad valorem tax on 
real property such as land, building, machinery, and other improvement not hereinafter 
specifically exempted. 
ates sf Levy. - A province or city or a municipality within the 
Metropolitan Manila Area shall fix a uniform basic tax rate applied to the fair market 
value of the real property as follows: 
(1) Residential- Ten percent (10%) of one percent (I 
%) to one percent (I 
%); 
percent (2%); 
(2) Commercial- Twenty percent (20%) of one percent (1 %) to two 
(3) Agricultural- Fifteen percent (15%) of one percent (1 %) to one and 
one-half percent (I 
.5%); and 
(4) Others - Ten percent (10%) of one percent (I %) to one and one-half 
percent (I 
.5%); 
SEC. 35d. Exemptions from ea1 ~
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Tax. - The following are exempted 
from payment of the real property tax: 
(a) Real property owned by the Republic of the Philippines or any of its political 
subdivisions except when the beneficial use thereof has been granted, for 
consideration or otherwise, to a taxable person; 
(b) Charitable institutions, churches, parsonages or convents appurtenant thereto, 
mosques, nonprofit or religious cemeteries and all lands, buildings, and 
improvements actually, directly, and exclusively used for religious, charitable or 
educational purposes; 
(c) All machineries and equipment that are actually, directly and exclusively 
used by local water districts and government-owned or -controlled 
corporations engaged in the supply and distribution of water and/or 
generation and transmission of electric power; and 


IVlachinery and equipment used for pollution control and environmental 
protection. Except as provided herein, any exemption from payment of real property tax 
previously granted to, or presently enjoyed by, all persons, whether natural or juridical, 
including all government owned or -controlled corporations are hereby withdrawn upon 
the effectivity of this Code. 
pecial Levies on 
2. Additional Levy 01% 
ea! Property for the pecial Education Fund. 
- A province or city, or a municipality within the Metropolitan Manila Area, shall levy and 
collect an additional annual tax on the Fair Market Value of real property based on the 
following rates: 
(I) 
Residential - Ten percent (1 0%) of one percent (1 %) to one percent (I %); 
(2) Commercial - Twenty percent (20%) of one percent (I O h )  to two percent (2%) 
(3) Agricultural- Fifteen percent (15%) of one percent ( A  %) to one and one-half 
percent (I 
.5%); and 
(4) Others - Ten percent (I 
0%) of one percent (1 %) to one and one-half percent 
I 
.5% 
C. 353. A d ~ i t ~ o n a ~  
Ad Walorern Tax on idle Lands. - A province or city, or a 
municipality the Metropolitan Manila Area, may levy an annual tax on idle lands at the 
rate not exceeding three percent (3%) of the fair market value of the property, which 
shall be in addition to the basic real property tax. 
ie Lands, Cowera e. - For purposes of real property taxation, idle 
lands shall the following: a) “Agricultural lands, more than one (I) 
hectare in area, 
suitable for cultivation, dairying, inland fishery, and other agricultural uses, one-half (I 
12) 
of which remain uncultivated or unimproved by the owner of the property or person 
having legal interest therein.” Agricultural lands planted to permanent or perennial crops 
with at least fifty (50) trees to a hectare shall not be considered idle lands. Lands 
actually used for grazing purposes shall likewise not be considered idle lands. 
(b) Lands, other than agricultural, located in a city or municipality, more than one 
thousand (I 
,000) square meters in area one-half (112) of which remain unutilized 
or unimproved by the owner of the property or person having legal interest 
therein. 
Regardless of land area, this Section shall likewise apply to residential lots in 
subdivisions duly approved by proper authorities, the ownership of which has been 
transferred to individual owners, who shall be liable for the additional tax: Provided, 


however, That individual lots of such subdivisions, the ownership of which has not been 
transferred to the buyer shall be considered as part of the SubdivkiQn, and shall be 
subject to the additional tax payable by subdivision owner or operator. 
C. 355. Idle Lands Exempt from Tax. - A province or city or a municipality 
within the Metropolitan Manila Area may exempt idle lands from the additional levy by 
reason of force majeure, civil disturbance, natural calamity or any cause or 
circumstance which physically or legally prevents the owner of the property or person 
having legal interest therein from improving, utilizing or cultivating the same. 
pecia! Levy by Local 
o v e ~ n ~ ~ n ~ ~ .  
- A province, city or 
municipality may in addition to the basic tax impose a special levy on the lands 
comprised within its territorial jurisdiction specially benefited by public works projects or 
improvements funded by the local government concerned: Provided, however, That the 
special levy shall not apply to lands exempt from basic real property tax and the 
remainder of the land portions of which have been donated to the local government 
concerned for the construction of such projects or improvements. 
SEC. 357. Ordinance imposing a pecial Levy. - A tax ordinance imposing a 
special levy shall describe with reasonable accuracy the nature, extent, and location of 
the public works projects or improvements to be undertaken, state the estimated cost 
thereof, specify the metes and bounds by monuments and lines and the number of 
annual installments for the payment of the special levy. 
SEC. 358. Publication of P r o p  
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a Special Levy. - 
Before the enactment of an imposing a special levy, the sanggunian concerned shall 
conduct a public hearing thereon; notify in writing the owners of the real property to be 
affected or the persons having legal interest therein as to the date and place thereof 
and afford the latter the opportunity to express their positions or objections relative to 
the proposed ordinance. 
SEC. 359. Taxpayers' 
pecial Levy. - Any owner of real 
property affected a special levy or any person having a legal interest therein may, upon 
receipt of the written notice of assessment of the special levy, avail of the remedies 
provided in Chapter 2, Article Three, Title Nine of this Code. 


pecial Levy. -The special levy shall accrue on the firsf 
day of the next following the effectivity of the ordinance imposing such levy. 
ix. Collection of 
x.- The real property tax for any year shall 
accrue on the first ('l51) day of January and from that date it shall constitute a lien on 
the property which shall be superior to any other lien, mortgage, or encumbrance of any 
kind whatsoever, and shall be extinguished only upon the payment of the delinquent tax 
or after the expiration of the period of prescription provided for in the Section 382 of this 
Code. 
SEC. 362. Collection of Tax. - The collections of the real property tax with 
interest thereon and related expenses shall be the responsibility of the city or municipal 
treasurer concerned. 
The city or municipal treasurer may deputize the barangay treasurer to collect all 
taxes on real property located in the barangay: Provided, That the barangay treasurer is 
properly bonded for the purpose: Provided, fmfher, That the premium on the bond shall 
be paid by the city or municipal government concerned. 
3. Payment 0 
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the real property or the person having legal interest therein may pay the basic real 
property tax and the additional tax for Special Education Fund (SEF) due thereon 
without interest in four (4) equal installments; the first installment to be due and payable 
on or before March thirty-first (3151); the second installment, on or before June thirty 
(30); the third installment, on or before September thirty (30); and the last installment on 
or before December thirty-first (3151), except the special levy the payment of which 
shall be governed by ordinance of the sanggunian concerned. 
The date for the payment of any other tax imposed under this Chapter without 
interest shall be prescribed by the sanggunian concerned. 
Payments of real property taxes shall first be applied to prior years 
delinquencies, interests, and penalties, if any, and only after said delinquencies are 
settled may tax payments be credited for the current period. 


SEC. 364. Tax 
~~~~~~~~ 
for 
~~~~~~, 
- ff the basic real 
property tax and the additional tax accruing to the Special Education Fund (SEF) are 
paid in full on or before December thirty-first (3151) of the preceding taxable year, a 
discount of twenty percent (20%) of the annual tax due is hereby granted. 
If the basic real property tax and the additional tax accruing to the Special 
Education Fund (SEF) are paid on or before the end of the first month of the quarter, a 
discount of ten percent (1 0%) of the tax due for the quarter is hereby granted. 
SEC. 365. Payment Under rotesit. - (a) No protest shall be entertained unless 
the taxpayer first pays the tax. There shall be annotated on the tax receipts the words 
"paid under protest". The protest in writing must be filed wi'thill thirty (30) days from 
payment of the tax to the provincial, city treasurer or municipal treasurer, in the case of 
a municipality within Metropolitan Manila Area, who shall decide the protest within sixty 
(60) days from receipt. 
(b) The tax or a portion thereof paid under protest, shall be held in trust by the 
treasurer concerned. 
(c) In the event that the protest is finally decided in favor of the taxpayer] the 
amount or portion of the tax protested shall be refunded to the protestant, or 
applied as tax credit against his existing or future tax liability. 
(d) In the event that the protest is denied or upon the lapse of the sixty (60) day 
period prescribed in subparagraph (a), the taxpayer may appeal in a manner 
provided for in Section 344 of this Code. 
SEC. 366. Repayment of Excessive Collections. - When an assessment of basic 
real property tax, or any other tax levied under this Title, is found to be illegal or 
erroneous and the tax is accordingly reduced or adjusted, the taxpayer may file a 
written claim for refund or credit for taxes and interests with the provincial or city 
treasurer within two (2) years from the date the taxpayer is entitled to such reduction or 
adjustment. The provincial or city treasurer shall decide the claim for tax refund or credit 
within sixty (60) days from receipt thereof. In case the claim for tax refund or credit is 
denied, the taxpayer may avail of the remedies as provided in this Title. 
EC. 367. interests on Unpaid ea1 ~~~~~~y Tax. - In case of failure to pay the 
basic real property tax or any other tax levied under this Title upon the expiration of the 
periods as provided in Section 363, hereof, or when due, as the case may be, shall 


subject the taxpayer to the payment of interest at the rate of two percent (2%) per 
month on the unpaid amount or a fraction thereof, until the delinquent tax shall have 
been fully paid: Provided, however, That in no case shall the total interest on the unpaid 
tax or portion thereof exceed sixty (60) months. 
EC. 368. Remedies for the ollection of Re 1 ~ ~ o ~ e r t y  
Tax. - For the collection 
of the basic real property tax and any other tax levied under this Title, the local 
government concerned may avail of the remedies by administrative action thru levy on 
real property or by judicial action. 
SEC. 369. Local overnmenrts Lien. - The basic real property tax and any other 
tax levied under this Title constitutes a lien on the property subject to tax, superior to all 
liens, charges or encumbrances in favor of any person, irrespective of the owner or 
possessor thereof, enforceable by administrative or judicial action, and may only be 
extinguished upon payment of the tax and the related interests and expenses. 
SEC. 370. Levy on Real Property. - After the expiration of the time required to pay 
the basic real property tax or any other- tax levied under this Title, real property subject 
to such tax may be levied upon through the issuance of a warrant on or before, or 
simultaneously with, the institution of the civil action for the collection of the delinquent 
tax. The provincial or city treasurer, or a treasurer of a municipality within the 
Metropolitan Manila Area, as the case may be, when issuing a warrant of levy shall 
prepare a duly authenticated certificate showing the name of the delinquent owner of 
the property or person having legal interest therein, the description of the property, the 
amount of the tax due and the interest thereon. The warrant shall operate with the force 
of a legal execution throughout the province, city or a municipality within the 
Metropolitan Manila Area. The warrant shall be mailed to or served upon the delinquent 
owner of the real property or person having legal interest therein, or in case he is out of 
the country or cannot be located, to the administrator or occupant of the property. At the 
same time, written notice of the levy with the attached warrant shall be mailed to or 
served upon the assessor and the Registrar of Deeds of the province, city or a 
municipality within the Metropolitan Manila Area where the property is located, who shall 
annotate the levy on the tax declaration and certificate of title of the property, 
respectively. 
The levying officer shall submit a report on the levy to the sanggunian concerned 
within ten (1 0) days after receipt of the warrant by the owner of the property or person 
having legal interest therein. 


I. 
Penalty for Failure to Issue an 
to criminal prosecution under the Revised Penal Code and other applicable laws, any 
local treasurer or his deputy who fails to issue or execute the warrant of levy within one 
(I) 
year from the time the tax becomes delinquent or within thirty (30) days from the 
date of the issuance thereof, or who is found guilty of abusing the exercise thereof in an 
administrative or judicial proceeding shall be dismissed from the service. 
dvertisement and ale. - Within thirty (30) days after service of the 
warrant of levy, the local treasurer shall proceed to publicly advertise for sale or auction 
the property or a usable portion thereof as may be necessary to satisfy the tax 
delinquency and expenses of sale. The advertisement shall be effected by posting a 
'notice at the main entrance of the provincial, city or municipal building, and in a publicly 
accessible and conspicuous place in the barangay where the real property is located, 
and by publication once a week for two (2) weeks in a newspaper of general circulation 
in the province, city or municipality where the property is located. The advertisement 
shall specify the amount of the delinquent tax, the interest due thereon and expenses of 
sale, the date and place of sale, the name of the owner of the real property or person 
having legal interest therein, and a description of the property to be sold. At any time 
before the date fixed for the sale, the owner of the real property or person having legal 
interest therein may stay the proceedings by paying the delinquent tax, the interest due 
thereon and the expenses of sale. The sale shall be held either at the main entrance of 
the provincial, city or municipal building, or on the property to be sold, or at any other 
place as specified in the notice of the sale. 
Within thirty (30) days after the sale, the local treasurer or his deputy shall make 
a report of the sale to the sanggunian concerned, and which shall form part of his 
records. The local treasurer shall likewise prepare and deliver to the purchaser a 
certificate of sale which shall contain the name of the purchaser, a description of the 
property sold, the amount of the delinquent tax, the interest due thereon, the expenses 
of sale and a brief description of the proceedings: Provided, however, That proceeds of 
the sale in excess of the delinquent tax, the interest due thereon, and the expenses of 
sale shall be remitted to the owner of the real property or person having legal interest 
therein. 
The local treasurer may, by ordinance duly approved, advance an amount 
sufficient to defray the costs of collection thru the remedies provided for in this Title, 
including the expenses of advertisement and sale. 


old. - Within one ( 4 )  year from the date of 
sale, the owner of the delinquent real property or person having legal interest therein, or 
his representative, shall have the right to redeem the property upon payment to the local 
treasurer of the amount of the delinquent tax, including the interest due thereon, and the 
expenses of sale from the date of delinquency to the date of sale, plus interest of not 
more than two percent (2%) per month on the purchase price from the date of sale to 
the date of redemption. Such payment shall invalidate the certificate of sale issued to 
the purchaser and the owner of the delinquent real property or person having legal 
interest therein shall be entitled to a certificate of redemption, which shall be issued, by 
the local treasurer or his deputy. From the date of sale until the expiration of the period 
of redemption, the delinquent real property shall remain in the possession of the owner 
or person having legal interest therein who shall be entitled to the income and other 
fruits thereof. The local treasurer or his deputy, upon receipt from the purchaser of the 
certificate of sale, shall forthwith return to the latter the entire amount paid by him plus 
interest of not more than two percent (2%) per month. Thereafter, the property shall be 
free from the lien of such delinquent tax, interest due thereon and expenses of sale. 
SEC. 374. Final Deed to Purchaser. - In case the owner or person having legal 
interest fails to redeem the delinquent property as provided herein, the local treasurer 
shall execute a deed conveying to the purchaser said property, free from lien of the 
delinquent tax, interest due thereon and expenses of sale. The deed shall briefly state 
the proceedings upon which the validity of the sale rests. 
SEC. 395. Purchase of Property by the Local ~ o v ~ ~ n ~ e n t  
for Want of 
Bidder. - In case there is no bidder for the real property advertised for sale as provided 
herein, or if the highest bid is for an amount insufficient to pay the real property tax and 
the related interest and costs of sale the local treasurer conducting the sale shall 
purchase the property in behalf of the local government concerned to satisfy the claim 
and within two (2) days thereafter shall make a report of his proceedings which shall be 
reflected upon the records of his office. It shall be the duty of the Registrar of Deeds 
concerned upon registration with his office of any such declaration of forfeiture to 
transfer the title of the forfeited property to the local government concerned without the 
necessity of an order from a competent court. 


Within one (I) 
year from the date of such forfeiture, the taxpayer or any of his 
representative, may redeem the property by paying to the local treasurer the full amount 
of the real property tax and the related interest and the costs of sale. If the property is 
not redeemed as provided herein, the ownership thereof shall be fully vested on the 
local government concerned. 
state 
~~~~~ 
for Taxes, Fees, or Charges. - The 
sanggunian concerned may, by ordinance duly approved, and upon notice of not less 
than twenty (20) days, sell and dispose of the real property acquired under the 
preceding section at public auction at a price not prejudicial to the government. The 
proceeds of the sale shall be distributed in accordance with the provisions of Section 
383 of this Code. 
SEC. 377. Further Levy. - Levy may be repeated if necessary until the full due, 
including all expenses, is collected. 
EC. 378. Collection of 
rope* 
Tax Throu 
ourts. - The local 
government concerned may enforce the collection of the basic real property tax or any 
other tax levied under this Title by civil action in any court of competent jurisdiction. The 
civil action shall be filed by the local treasurer within the period prescribed in Section 
382 of this Code. 
SEC. 379. Action A § ~ ~ i ~ i n ~  
Validity of ?ax 
ale. - No court shall entertain any 
action assailing the validity of any sale at public auction of real property or rights therein 
under this Title until the taxpayer shall have deposited with the court the amount for 
which the real property was sold, together with interest of two percent (2%) per month 
from the date of sale to the time of the institution of the action. The amount so deposited 
shall be paid to the purchaser at the auction sale if the deed is declared invalid but it 
shall be returned to the depositor if the action fails. Neither shall any court declare a 
sale at public auction invalid by reason of irregularities or informalities in the 
proceedings unless the substantive rights of the delinquent owner of the real property or 
the person having legal interest therein have been impaired. 
SEC. 380. Payment of Delinquent Taxes on 
ubject OB Controversy. 
- In any action involving the ownership or possession of, or succession to, real property, 
the court may, motu propio or upon representation of the provincial, city, or municipal 
treasurer or his deputy, award such ownership, possession, or succession to any party 


to the action upon payment to the court of the taxes with interest due on the properly 
and all other costs that may have accrued, subject to the final outcome of the action. 
EC. 381. 'Treasurer to Certify ~ e ~ ~ m ~ u e ~ c ~ e ~  
Uncollected. - The 
provincial, city or municipal treasurer or their deputies shall prepare a certified list of all 
real property tax delinquencies which remained uncollected or unpaid for at least one 
(1) year in his jurisdiction, and a statement of the reason or reasons for such non- 
collection or non-payment, and shall submit the same to the sanggunian concerned on 
or before December thirty-first (31st) of the year immediately succeeding the year in 
which the delinquencies were incurred, with a request for assistance in the enforcement 
of the remedies for collection provided herein. 
eriods Within Which to Collect Real Property Taxes. - The basic 
real property tax and any other tax levied under this Title shall be collected within five 
(5) years from the date they become due. No action for the collection of the tax, whether 
administrative or judicial, shall be institilted after the expiration of such period. If no 
effort to collect such tax within said period of prescription has been conducted. In case 
of fraud or intent to evade payment of the tax, such action may be instituted for the 
collection of the same within ten (1 0) years from the discovery of such fraud or intent to 
evade payment. The period of prescription within which to collect shall be suspended for 
the time during which: 
(*I) The local treasurer is legally prevented from collecting the tax; 
(2) The owner of the property or the person having legal interest therein requests 
for reinvestigation and executes a waiver in writing before the expiration of 
the period within which to collect; and 
(3)The owner of the property or the person having legal interest therein is out of 
the country or otherwise cannot be located. 
EC. 383. Distribution of Proceeds;. - The proceeds of the basic real property 
tax, including interest thereon, and proceeds from the use, lease or disposition, sale or 
redemption of property acquired at a public auction in accordance with the provisions of 
this Title by the province or city or a municipality within the Metropolitan Manila Area 
shall be distributed as follows: 
(a) In the case of provinces: 
(I) 
Province - Thirty-five (35%) shall accrue to the general fund; 


(2) Municipality - Forty five percent (45%) to the general fund of the 
(3) Municipality where the property is located; and 
(3) Barangay - Twenty percent (20%) shall accrue to the barangay where the 
property is located. 
(b) In the case of cities: 
(I) 
City - Seventy percent (70%) shall accrue to the general fund of the city; and 
(2) Thirty percent (30%) shall be distributed among the component barangays of 
the cities where the property is located in the following manner: 
(i) Fifty percent (50%) shall accrue to the barangay where the property is 
located; 
(ii) Fifty percent (50%) shall accrue equally to all component barangays of 
the city; and 
(c) In the case of a municipality within the Metropolitan Manila Area: 
(I) 
Metropolitan Manila Authority - Thirty-five percent (35%) shall accrue to the 
general fund of the authority; 
(2) Municipality - Thirty-five percent'(35%) shall accrue to the general fund of the 
municipality where the property is located; 
(3) Barangays - Thirty percent (30%) shall be distributed among the component 
barangays of the municipality where the property is located in the following 
manner: 
(i) Fifty percent (50%) shall accrue to the barangay where the property is 
located; 
(ii) Fifty percent (50%) shall accrue equally tu all component barangays of the 
municipality. 
(d) The share of each barangay shall be released, without need of any further 
action, directly to the barangay treasurer on a quarterly basis within five (5) days 
after the end of each quarter and shall not be subject to any lien or holdback for 
whatever purpose. 
istribution and 
pplication of 
Tax. - (a) The proceeds from the additional tax on real property accruing to the Special 
Education Fund (SEF) shall be distributed as follows: forty percent (40%) to the 
Provincial School Board, forty percent (40%) to the Municipal School Board and twenty 
percent (20%) to the General Fund of the Municipality where the property is located 
Provided, That in the case of a city, the proceeds of the SEF tax shall be distributed as 
follows: Eighty percent (80%) to the City School Board and twenty percent (20%) to the 
General Fund of the city. 
(b) The proceeds of the SEF Tax accruing to the School Board shall be 


allocated for the operation and maintenance of public schools, 
construction and repair of school buildings, facilities and equipment, 
educational research, purchase of books and periodicals, and as 
determined and approved by the Local School Board. 
roceeds of the Tax on Idle Land . - The proceeds of the additional 
real property tax on idle lands shall accrue to the respective general fund of the 
province or city where the land is located. In the case of a municipality within the 
Metropolitan Manila Area, the proceeds shall accrue equally to the Metropolitan Manila 
Authority and the municipality where the land is located. 
SEC. 386. Proceeds of the peciial Levy, - The proceeds of the special levy on 
lands benefited by public works, projects and other improvements shall accrue to the 
general fund of the local government, which financed such public works, projects or 
other improvements. 
Article Eight. peciaf Provisions 
SEC. 387. General Assessment Revision; Expenses Incident Thereto. - The 
sanggunian of provinces, cities and municipalities within the Metropolitan Manila Area 
shall provide the necessary appropriations to defray the expenses incident to the 
general revision of real property assessment. All expenses incident to a general revision 
of real property assessments shall, by ordinance of the sangguniang panlalawigan, be 
apportioned between the province and the municipality on the basis of the taxable area 
of the municipality concerned. 
eduction of Weal P
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T x and Interest. - In 
case of a general failure of crops or substantial decrease in the price of agricultural or 
agri-based products, or calamity in any province, city, or municipality, the sanggunian 
concerned, by ordinance passed prior to the first (Ist) 
day of January of any year and 
upon recommendation of the Local Disaster Coordinating Council, may condone or 
reduce, wholly or partially, the taxes and interest thereon for the succeeding year or 
years in the city or municipality affected by the calamity. 
EC. 389. ~ Q ~ ~ ~ ~ a t i o ~  
or 
Philippines. - The of the Philippines may, when public interest so requires, condone or 
reduce the real property tax and interest for any year in any province or city or a 
municipality within the Metropolitan Manila Area. 


SEC. 390. Duty of Re 
~~~~r~~~ ~~~~~C to 
Provincial, City or Municipal Assessor. - It shall be the duty of the Registrar of Deeds 
and notaries public to furnish the provincial, city or municipal assessor with copies of all 
contracts selling, transferring, or otherwise conveying, leasing, or mortgaging real 
property received by, or acknowledged before them. 
EC. 391. lnsurance Cornpanie 
to Furnish Information. - lnsurance 
companies are hereby required to furnish the provincial, city or municipal assessor 
copies of any contract or policy insurance on buildings, structures, and improvements 
insured by them or such other documents which may be necessary for the proper 
assessment thereof. 
SEC. 392. Fees in Court cticans. - All court actions, criminal or civil, instituted 
at the instance of the provincial, city or municipal treasurer or assessor under the 
provisions of this Code, shall be exempt from the payment of court and sheriffs fees. 
SEC. 393. Fees in ~
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Delinquent Weal Property to 
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- All certificates, 
documents, and papers covering the sale of delinquent property to the province, city or 
municipality, if registered in the Registry of Property, shall be exempt from the 
documentary stamp tax and registration fees. 
ssessment Notices or Owner's Copies of Tax 
Declarations to be Exempt from Postal Char es or Fees. - All real property 
assessment notices or owner's copies of tax declaration sent through the mails by the 
assessor shall be exempt from the payment of postal charges or fees. 
ale and Forfeiture efore ~
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of ode. - Tax delinquencies 
incurred] and sales and forfeitures of delinquent real property effected, before the 
effectivity of this Code shall be governed by the provisions of applicable laws then in 
force. 
~~~~~r 
hares of Local Governments in the ~~~~~~~s sf N 
o v ~ ~ n m e n ~  
Taxes. - Upon approval of this Code, 
local governments are entitled to a fifty percent (50%) share of national government 
taxes based on the collection of the third fiscal year preceding the current fiscal year. 


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- The share of local governments 
from national government taxes, less the five percent (5%) share of Regional 
Governments allocated in Chapter 3, Title Three, Title Nine of this Code, which is 
automatically appropriated and obligated, shall be allocated in the following manner: 
(a) Provinces - Twenty-three percent (23%); 
(b) Cities - Twenty-two percent (22%); 
(c) Municipalities - Thirty percent (30%); and 
(d) Barangay - Twenty percent (20%) 
Provided, however, That the share of each barangay with a population of not less 
than one hundred (100) inhabitants shall not be less than eighty thousand pesos 
(Php80,000.00) 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: 
(I 
) Population - Forty percent (40%); and 
(2) Equal Sharing - Sixty percent (60%) 
(b) On the second year: 
( I )  Population - Fifty percent (50%); and 
(2) Equal Sharing - Fifty percent (50%) 
(c) On the third year and thereafter: 
(I) Population - Sixty percent (60%); and 
(2) Equal Sharing - Forty percent (40%). Provided, fina//y, that the financial 
requirements of barangays created by local governments after the effectivity 
of this Code shall be the responsibility of the local government concerned. 
Provided, finally, That the financial requirements of barangays created by local 
governments after the effectivity of this Code shall be the responsibility of the local 
government concerned. 
SEC. 398. Automatic Release of hares. - (a) The share of each local 
government shall be released without need of any further action, directly to the 
provincial, city, municipal or barangay treasurer, as the case may be, on a monthly or 
quarterly basis within five (5) days after the end of each month or quarter; 
(b) Said share shall not be subject to any lien, or holdback that may be imposed by 
(c) Nothing in this Chapter shall be understood to diminish the share of local 
the national government for whatever purpose. 
governments under existing laws. 


In the event that the National Government incurs an unmanageable public sector 
deficit, the President of the Philippines is hereby authorized, upon the recommendation 
of the Secretary of Finance, Secretary of Department of the interior and Local 
Government, and Secretary of Budget and Management, and subject to consultations 
with the presiding officers of both Houses of the Congress and the Presidents of the 
Liga, to make the necessary adjustments in the internal revenue allotment of local 
governments, but in no case shall the allotment be less than thirty percent (30%) of the 
collection of the internal revenue taxes the third fiscal year preceding the current fiscal 
year. Provided, furfher, That in the first year of the effectivity of this Code, the local 
governments shall, in addition to the thirty percent (30%) internal revenue allotment 
which shall include the cost of devolved functions for essential public services, be 
entitled to receive the amount equivalent to the cost of devolved personal services. 
9. Local Development Projects. - Each local government shall 
appropriate in its annual budget no less than twenty percent (2O%), of its annual 
national government tax share for development projects in accordance with the annual 
investment program embodied in the local development plan prepared by the local 
development council and approved by the sanggunian concerned. 
SEC. 400. RuIees and ~ e ~ f f ~ ~ ~ i o f f ~ ,  
- The Secretary of Finance, in consultation 
with the Department of Budget and Management, shall promulgate the necessary rules 
and regulations for a simplified disbursement scheme designed for the speedy and 
effective enforcement of the provisions of this Chapter. 
Article Two. Share of Local 
SEC. 401. Share in the Proceeds from the ~
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and Utilization of 
the National Wealth. - Local governments shall have an equitable share in the proceeds 
derived from the utilization and development of the national wealth within their 
respective areas, including sharing the same with the inhabitants by way of direct 
benefits. 
National wealth shall be defined as all natural resources situated within the 
territorial jurisdiction of the republic including but not limited to lands of public domain, 
waters, minerals, potential energy sources, gas and oil deposits, forest products, flora 
and fauna, fishery and aquatic resources, all quarry products, and other resources 
which can be extracted or utilized. 
EC. 402. Amount of 
5 w ~ ~ n ~ ~ n ~ ~ .  
- In addition to their share 
of the national government taxes, local governments shall have a share of sixty percent 
(60%), of the gross collection derived by the natianal government in the preceding fiscal 
year from mining taxes, royalties, forestry and fishery charges, and such other taxes, 
fees, or charges, including related surcharges, interests, or fines, and from its share in 


any co-production, joint venture or production sharing agreement in the utilization and 
development of the national wealth within their territorial jurisdiction. 
3. Share of the Local Governments from any 
overnment Agency 
or -Owned and - 
o ~ a ~ ~ o ~ .  
- Local governments shall have a share 
based on the preceding fiscal year from the proceeds derived by any government 
agency or government-owned or controlled corporation engaged in the utilization and 
development of the national wealth based on the following formula whichever will 
produce a higher share for the local government: 
(a) One percent (I %) of the gross sales or receipts of the preceding calendar year; 
or 
(b) Forty percent (40%) of the mining taxes, royalties, forestry and fishery 
charges and such other taxes, fees or charges, inchding related surcharges, 
interests, or fines the government agency or government -owned or - 
controlled corporation would have paid if it were not otherwise exempt. 
SEC. 404. Allocation of hares. - The share in the preceding Section shall be 
distributed in the following manner: 
(a) Where the natural resources are located in the province 
(1) Province - Twenty percent (20%); 
(2) Component city/municipality - Forty-five percent (45%); and 
(3) Barangay - Thirty-five percent (35%) 
Provided, however, That where the natural resources are located in two (2) or 
more provinces, or in two (2) or more component cities or municipalities or in two (2) or 
more barangays, their respective shares shall be computed on the basis of: 
(I) 
Population - Seventy percent (70%); and 
(2) Land area - Thirty percent (30%). 
(b) Where the natural resources are located in a highly urbanized or independent 
component city: 
(I) 
City - Sixty-five percent (65%); and 
(2) Barangay - Thirty-five percent (35%) 
Provided, however, That where the natural resources are located in such two (2) 
or more cities, the allocation of shares shall be based on the formula on population and 
land area as specified in paragraph (a) of this Section. 
EC. 
erniftaance of the hare of Local 
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- The share of 
local governments from the utilization and development of national wealth shall be 
remitted in accordance with Section 398 of this Code: Provided, however, that in the 
case of any government agency or government-owned or -controlled corporation 
engaged in the utilization and development of the national wealth, such share shall be 
directly remitted to the provincial, city, municipal or barangay treasurer concerned within 


five (5) days after the end OF each quarter. 
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of fhe hivelihoo Proj@ck - The proceeds from the 
share of local governments pursuant to this chapter shall be appropriated by their 
respective sanggunian to finance development and livelihood projects: Eighty percent 
(80%) of the proceeds derived from the development and utilization of hydro-thermal, 
geothermal, and other sources of energy shall be applied to lower the cost of electricity 
and to finance development projects in the local government where the source of 
energy is located. 
Chapter 4 
Credit Financing 
SEC. 407’. Scope. - This Chapter shall govern the power of local governments to 
create indebtedness and to enter into credit and other financial transactions. 
EC. 408. General Policy- - (a) It shall be the basic policy that any local 
government may create indebtedness, and avail of credit facilities to finance local 
infrastructure and other socio-economic development projects in accordance with the 
approved local development plan and public investment program. 
(b) A local government may avail of credit lines from any bank and other lending 
institutions authorized by the Bangko Sentral ng Pilipinas, for the purpose of 
stabilizing local finances. 
redits$ and Ofher Forms of l n ~ e ~ f e ~ n e ~ ~  
of Local 
Governmenfs. - (a) A local government may secure loans, credits, guarantees and 
other forms of indebtedness with any government or domestic private bank and other 
I end i ng i nst i tu t ion s to finance the con st ruct ion , i nsta I la t ion , improvement , expans ion, 
operation, or maintenance of public facilities, infrastructure facilities, housing projects, 
acquisition of real property, and implementation of other capital investment projects, 
subject to such terms and conditions as may be agreed upon by the local government and 
the lender. The proceeds from such transactions shall accrue directly to the local 
government concerned. 
(b) A local government may likewise secure from any government bank and lending 
short, medium and long-term loans and advances against security of real estate 
or other acceptable assets for the establishment, development, or expansion of 
agricultural, industrial, commercial, house financing projects, livelihood projects, 
and other economic enterprises 
(c) Government financial and other lending institutions are hereby authorized to 
grant loans, credits, and other forms of indebtedness out of their loanable funds 
to local governments for purposes specified above. 
Government financing institutions shall, open appropriate lending windows for 
local governments. These financial institutions shall lend to fourth, fifth and sixth 
class municipalities, cities and provinces at concessional rates. 


d) The local government concerned shall publish all loans applied for, specifying the 
amount to be borrowed, the project to be funded, the security offered, and the 
terms of payment in a newspaper of local circulation, if any or if there is none, in 
a newspaper of general circulation in the province, city, municipality or barangay 
concerned. The publication shall be done in three (3) consecutive issues of a 
daily newspaper. 
Upon the filing of the loan, the provincial government concerned shall cause the 
posting of the loan application in all the city or municipal halls of the province. In the 
case of a city or municipality, the loan application shall be posted in all barangay halls 
and in the municipal or city hall concerned. 
In the case of the barangay, the loan application shall be posted in the barangay 
hall and in conspicuous and publicly accessible places. 
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and Other F ~ n a n c ~ ~ ~  
Schemes. - Provincial , city 
and municipal governments may likewise acquire property, plant, machinery, 
equipment, and such necessary accessories under a supplier's credit, deferred payment 
plan, or other financial scheme. 
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Subject to rules and 
regulations of the Central Bank and the Securities and Exchange Commission, 
provinces, cities, and municipalities are hereby authorized to issue bonds, debentures, 
securities, collateral notes and other obligations to finance self-liquidating, income- 
producing development or livelihood projects pursuant to the priorities established in the 
approved local development plan or the public investment program. The sanggunian 
concerned shall, through an ordinance approved by a majority of all its members, 
declare and state the terms and conditions of the bonds and the purpose for which the 
proposed indebtedness is to be incurred. 
Said bonds, debentures, securities, collateral, notes and other obligations shall 
be exempted from all taxes. 
SEC. 44 2. ~ n t ~ ? ~ ~ ~ c a ~  
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- Provinces, 
cities and municipalities may, upon approval of the majority of all members of the 
sanggunian concerned and in amounts not exceeding their surplus funds, extend loans, 
grants, or subsidies to other local governments under such terms and conditions as may 
be agreed upon by the contracting parties. 
Local governments may, upon approval of their respective sanggunian, jointly or 
severally contract loans, credits, and other forms of indebtedness for purposes mutually 
beneficial to them. 
. Loan from Fun 
urces. - (a) The President, or his duly authorized representative, may, 
through any government financial or other lending institution, relend to any province, 


city, municipality, or barangay, the proceeds of loans contracted with fureign financial 
institutions or other international funding agencies for the purpose of financing the 
construction, installation, improvement, expansion, operation, or maintenance of public 
utilities and facilities, infrastructure facilities, or housing projects, the acquisition of real 
property, and the implementation of other capital investment projects, subject to such 
terms and conditions as may be agreed upon by the President and the local 
government. The proceeds from such loans shall accrue directly to the local 
government concerned. 
(b) The President may likewise authorize the relending to local governments the 
proceeds of grants secured from foreign sources, subject to the provisions of 
existing laws and the applicable grant agreements. 
(c) Repayment or amortization of loans including accrued interest thereon, may be 
financed from the income of the projects or services and from the regular 
income of the local government, which must be provided for and appropriated 
regularly in its annual budget until the loan and the interest thereon shall have 
been fully paid. 
SEC. 41 4. 
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Sector. - (a) Local governments may enter into contracts with any qualified project 
proponent including operatives and non government organizations for the financing, 
construction, operation, management, provisioning andlor maintenance of any 
financially viable development project under the build-operate-and transfer agreement 
andlor its variants, or under contract of management, service, lease, concession, joint 
venture, or combination thereof, or under any other private sector participation 
arrangement, as provided for under R.A. 6957, as amended. 
Terms and Conditions: 
All projects implemented under this Section shall be subject to the following 
(1) No approval by any national government agency, office or instrumentality is 
required for implementation of the project, regardless of its cost, under 
whatever private sector participation agreement, or whether involving one or 
more local governments. Where the project involves two or more local 
governments, the approval by its respective sanggunian is required. 
For projects jointly pursued by one or more local governments and the 
national government, or its agencies or instrumentalities, the approval by the 
Investment Coordinating Committee (ICC) of the National Economic and 
Development Authority ("34) 
shall be required. 
(2) Only the approval of the sanggunian concerned is required for locally funded 
projects implemented through competitive public bidding, including tolls, 


charges, rentals or fees, and adjustments thereon, for the use of said projects 
or facilities. The agreement of the parties implementing the projects may 
define the nature and extent of said adjustments. 
(3) Tolls, charges, rentals or fees, including adjustments thereon, for the use of 
projects or facilities subject to negotiated contracts shall require approval by 
the sang g u n i a n concerned . 
(4) Local governments importing heavy equipment and machinery are exempt 
from payment of duties, taxes or charges for implementing development 
projects. 
(b) Local governments shall include in their respective local development plans and 
public investment programs priority projects that may be financed, constructed, 
operated and maintained by the private sector under this Section. It shall be the duty of 
the local government concerned to disclose to the public all projects eligible for 
financing under this Section, including official notification of duly registered contractors 
and suppliers of goods and services and publication in newspapers of general or local 
circulation, in conspicuous and accessible public places. Local projects under the build- 
operate-transfer agreement shall be approved by the Regional Government. 
(c) Projects implemented under this Section shall be subject to the following terms 
and conditions: 
(1) The provincial, city, or municipal engineer, as the case may be, upon 
formal request in writing by the local chief executive, shall prepare the 
plans and specifications for the proposed project, which shall be 
submitted to the sanggunian for approval? 
(2) Upon approval by the sanggunian of the project plans and specifications, 
the provincial, city, or municipal engineer shall, as the case may be, 
cause to be published once every week for two (2) consecutive weeks in 
at least one (I) 
local newspaper which is circulated in the region, 
province, city or municipality in which the project is to be implemented, a 
notice inviting all duly qualified contractors to participate in a public 
bidding for the projects so approved. The conduct of public bidding and 
award of contracts for local government projects rinder this Section shall 
be in accordance with this Code and other applicable Paws, rules and 
regulations. In the case of a build-operate-and-tra~~~er 
agreement, the 
contract shall be awarded to the Howest compIying bidder whose offer is 
deemed most advantageous to the local government and based on the 
present value of its proposed tolls, fees, rentals, and charges over a fixed 
term for the facility to be constructed, operated, and maintained according 
to the prescribed minimum design and performance standards, plans, and 
specifications. For this purpose, the winning contractor shall be 
automatically granted by the local government concerned the franchise to 
operate and maintain the facility, including the collection of tolls, fees, 
rentals, and charges in accordance with subsection (c-4) hereof. 


In the case of a build-operate-and-transfer agreement, the contract shall 
be awarded to the lowest complying bidder based on the present value of 
its proposed schedule of amortization payments for the facility to be 
constructed according to the prescribed minimum design and 
performance standards, plans, and specifications, 
(3) Any contractor who shall undertake the prosecution of any project under this 
Section shall post the required bonds to protect the interest of the province, city, 
or municipality, in such amounts as may be fixed by the sanggunian concerned 
and the provincial, city, or municipal engineer shall not, as the case may be, 
allow any contractor to initiate the prosecution of projects under this Section 
unless such contractor presents proof or evidence that he has posted the 
required bond. 
(4) The contractor shall be entitled to a reasonable return of its investment in 
accordance with its bid proposal as accepted by the local government 
concerned . 
In the case of a build-operate-and-transfer agreement, the repayment shall be 
made by authorizing the contractor to charge and collect reasonable tolls, fees, 
rentals, and charges for the use of the project facility not exceeding those 
proposed in the bid and incorporated in the contract: Provided, That the local 
government concerned shall, based on reasonableness and equity, approve 
the tolls, fees, rentals and charges: Provided, further, That the imposition and 
collection of tolls, fees, rentals and charges shall be for a fixed period as 
proposed in the bid and incorporated in the contract which shall in no case 
exceed fifty (50) years: Provided, finafly, That during the lifetime of the contract, 
the contractor shall undertake the necessary maintenance and repair of the 
facility in accordance with standards prescribed in the bidding documents and 
in the contract. 
In the case of a build-operate-and-transfer agreement, the repayment shall be 
made through amortization payments in accordance with the schedule 
proposed ‘in the bid and incorporated in the contract. In case of land 
reclamation or construction of industrial estates, the repayment plan may 
consist of the grant of a portion or percentage of the reclaimed land or the 
industrial estate constructed. 
(5) Every infrastructure project undertaken under this Section shall be constructed, 
operated, and maintained by the contractor under the technical supervision of 
the local government and in accordance with the plans, specifications, 
standards, and costs approved by it. 
The provincial, city or municipal legal officer shall, as the case may be, review the 


contracts executed pursuant to this Section to determine their legality, validity, 
enforceability and correctness of form. 
ernedies and Sanctions. - Local governments shall appropriate in 
their respective annual budgets such amounts as are sufficient to pay the loans and 
other indebtedness incurred or redeem or retire bonds, debentures, securities, notes 
and other obligations issued under this Title: Provided, That failure to provide the 
appropriations herein required shall render their annual budgets inoperative. 
Chapter 5 
Local Fiscal Administration 
Ai%Cle one. &X"tmi $rQWiShf?S 
SEC. 4d6. Scope. - This Chapter shall govern the conduct and management of 
the financial affairs, transactions, and operations of Regional Governments, provinces, 
cities, municipalities, and barangays. 
SEC. 41 7. Fundamental Principles. - The financial affairs, transactions, and 
operations of local governments shall be governed by the following fundamental 
principles: 
(a) No money shall be paid out of the local treasury except in pursuance of an 
appropriations ordinance or law; 
(b) Local government funds and monies shall be spent solely for public purposes; 
(c) Local revenue is generated only from sources expressly authorized by law or 
ordinance, and collection thereof shall at all times be acknowledged properly; 
(d) All monies officially received by a local government officer in any capacity or on 
any occasion shall be accounted for as local funds, unless otherwise provided 
by law; 
purpose for which the trust was created or the funds received; 
(e) Trust funds in the local treasury shall not be paid out except in fulfillment of the 
(f) Every officer of the local government whose duties permit or require the 
possession or custody of local funds shall be properly bonded equivalent to the 
amount he/she is authorized to keep or hold, and such officer shall be 
accountable and responsible for said funds and for the safekeeping thereof in 
conformity with the provisions of law. 
(9) Local governments shall formulate sound financial plans, and the local budgets 
shall be based on programs, projects, and activities, in terms of expected 
results; 
(h) Local budget plans and goals shall, as far as practicable, be harmonized with 
national development plans, goals, and strategies in order to optimize the 
utilization of resources and to avoid duplication in the use of fiscal and physical 
resources; 


(i) Local budgets shall operationalize approved local development plans; 
(j) Local governments shall ensure that their respective budgets incorporate the 
requirements of their component units and provide for equitable allocation of 
resources among these component units; 
(k) National planning shall be based on local planning to ensure that the needs and 
aspirations of the people as articulated by the local governments in their 
respective local development plans are considered in the formulation of budgets 
of national line agencies or offices; 
(I) Fiscal responsibility, accountability, and liability shall be shared by all those 
exercising authority over the financial affairs, transactions, and operations of the 
local governments; and 
(m) The local government shall endeavor to have a balanced budget in each fiscal 
year of operation. 
SEC. 418. Definition of Terms. - The term - (a) "Annual Budget'' refers to a 
financial plan embodying the estimates of income and expenditures for one (I) fiscal 
year; 
(b) "Appropriation" refers to an authorization made by ordinance, directing the 
payment of goods and services from local government funds under specified 
conditions or for specific purposes; 
(c) "Budget Document" refers to the instrument used by the local chief executive to 
present a comprehensive financial plan to the sanggunian concerned; 
(d) "Capital Outlays" refers to appropriations for the purchase of goods and 
services, the benefits of which extend beyond the fiscal year and which add to 
the assets of the local government concerned, including investments in public 
utilities such as public markets and slaughterhouses; 
(e) "Continuing Appropriation" refers to an appropriation available to support 
obligations for a specified purpose or projects, such as those for the 
construction of physical structures or for the acquisition of real property or 
equipment, even when these obligations are incurred beyond the budget year; 
(f) "Current Operating Expenditures" refers to appropriations for the purchase of 
goods and services for the conduct of normaf local government operations within 
the fiscal year, including goods and services that will be used or consumed 
during the budget year; 
(9) "Expected Results" refers to the services, products, or benefits that will accrue 
to the public, estimated in terms of performance measures or physical targets; 
(h) "Fund" refers to a sum of money, of other assets convertible to cash, set aside 
for the purpose of carrying out specific activities or attaining certain objectives in 
accordance with special regulations, restrictions, or limitations, and constitutes 


an independent fiscal and accounting entity; 
(i) "Income" refers to all revenues and receipts collected or received forming the 
gross accretions of funds of the local government; 
(j) "Obligations'' refers to an amount committed to be paid by the local government 
for any lawful act made by an accountable officer for and in behalf of the local 
unit concerned; 
(k) "Personal Services" refers to appropriations for the payment of salaries, wages 
and other compensation of permanent, temporary, contractual, and casual 
employees of the local government; 
(I) "Receipts" refers to income realized from operations and activities of the local 
government or are received by it in the exercise of its corporate functions, 
consisting of charges for services rendered, conveniences furnished, or the 
price of a commodity sold, as well as loans, csntributions or aids from other 
entities, except provisional advances for budgetary purposes; and 
(m) "Revenue" refers to income derived from the regular system of taxation 
enforced under authority of law or ordinance, and, as such, accrues more or 
less regularly every year. 
,Article TWQ. Receipts, a ~ ~ ~ e e ~ i n ~  
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SEC. 419. Remittance of Government Monies to the Local Treasury. - 
Officers of the local authorized to receive and collect monies arising from taxes, 
revenues, or receipts of any kind shall remit the full amount received and collected to 
the treasury of such local government which shall be credited to the particular account 
or accounts to which the monies in question properly belong. 
SEC. 420. Local Funds. - Every local government shall maintain a General Fund 
which shall be used to account for such monies and resources as may be received by 
and disbursed from the local treasury. The General Fund shall consist of monies and 
resources of the local government, which are available for the payment of expenditures, 
obligations or purposes not specifically declared by law as accruing and chargeable to, 
or payable from, any other fund. 
. - There shall be maintained in every provincial; city, 
or municipal treasury the following special funds: 


(a) Special Education Fund (SEF) shall consist of the respective shares of 
provinces, cities, and barangays in the proceeds of the additional tax on real 
property to be appropriated for purposes prescribed in Section 384 of this 
Code: and 
(b) Trust Funds shall consist of private and public monies which have officially 
come into the possession of the local government or of a local government 
official as trustee, agent or administrator, or which have been received as a 
guaranty for the fulfillment of some obligation. A trust fund shall only be used 
for the specific purpose for which it was created or for which it came into the 
possession of the local government. 
SEC 422. Separation of 
oaks and Depository Accounts. - Local 
accountants and treasurers shall maintain separate books and depository accounts, 
respectively, for each fund in their custody or under such rules and regulations as the 
Commission on Audit may prescribe. 
SEC. 423. Depository Account. - Local treasurers shall maintain depository 
accounts in the name of their respective local governments with the Local Government 
Bank of the Philippines or its branches and in the absence thereof with banks duly 
authorized by the Bangko Sentral ng Pilipinas preferably nearest to the seat of its 
government. Earnings of each depository account shall accrue exclusively thereto. 
eparation of Personal Money from Public Fund - Local treasurers 
and other accountable officers shall keep personal monies separate and distinct from 
local public funds in their custody and shall not make profit out of public money or other 
wise apply the same to any use not authorized by law or ordinance. 
Article Three. pecial Accounts 
SEC. 425. Special Accounts to be ~ ~ i n ~ ~ ~ n e d  
in tile eneral Fund. - Local 
governments shall maintain special accounts in the general fund for the following: 
(a) Public utilities and other economic enterprises; 
(b) Loans, interests, bond issues, and other contributions for specific purposes; 


(c) Development projects funded from the share of the local government 
concerned In the internal revenue allotment and such other special accounts, 
which may be created by law or ordinance. 
Receipts, transfers, and expenditures involving the foregoing special accounts 
shall be properly taken up thereunder. 
Profits or income derived from the operation of public utilities and other economic 
enterprises, after deduction for the cost of improvement, repair and other related 
expenses of the public utility or economic enterprise concerned, shall first be applied for 
the return of the advances or loans made therefor. Any excess shall form part of the 
general fund of the local government concerned. 
Article Four. Local Government Budgeting 
SEC. 426. The Local Budget - Form and Content. - 
(a) Local government budgets shall primarily consist of two (2) parts: 
(1) The estimates of income; and 
(2) The total appropriations covering the current operating expenditures 
and capital outlays. 
(b) The budget document shall contain: 
(I) 
The budget 
message of the local chief executive setting forth the 
significance of the executive budget, particularly in relation to the 
approved local development plan which shall form part of the budget 
docum en t . 
(2)A brief summary of the programs, projects and activities to be 
accomplished in pursuit of the goals and objectives of the local 
government for the ensuing fiscal year,specifically the delivery of basic 
services or facilities adverted to by Section 15 of this Code. 
(3) Summary of financial statements setting forth: 
(i) The actual income and expenditures during the immediately 
preceding year; 


(ii) The actual income and expenditures of the first two (2) quarters 
and the estimates of income and expenditures for the last two (2) 
quarters of the current fiscal year; 
The estimates of income for the ensuing fiscal year from 
ordinances and laws existing at the time the proposed budget is 
transmitted, together with other revenue-raising proposals; 
The estimated expenditures necessary to carry out the programs, 
projects and activities of the local government for the ensuing fiscal 
year; 
All essential facts regarding the bonded and other long-term 
obligations and indebtedness of the local government, if any; 
Summary statement of all statutory and contractual obligations due; 
and 
Such other financial statements and data as are deemed necessary 
or desirable in order to disclose in all practicable detail the financial 
condition of the local government. 
SEC. 427. Submission of Detailed Statement of Income and Expenditures. - 
(a) On or before the fifteenth (15th) day of July of each year, local treasurers shall 
submit to their respective local chief executives a certified statement covering the 
income and expenditures of the preceding fiscal year, the actual income and 
expenditures of the first two (2) quarters of the current year, nd the estimated income 
and expenditures for the last two (2) quarters ofthe current year. 
SEC. 428. Local Finance Committee. - There is hereby created in every 
province, city, or municipality a local finance committee to be composed of the local 
planning and development officer, the local budget officer, and the local treasurer. It 
shall exercise the following functions: 
(a) Determine the income reasonably projected as collectible for the ensuing 
fiscal year; 
(b) Recommend the appropriate tax and other revenue measures or borrowings, 
which may be appropriate to support the budget; 
(c) Recommend to the local chief executive concerned the level of the annual 
expenditures and the ceilings of spending for economic, social, and general 
services based on the approved local development plans; 


(d) Recommend to the local chief executive concerned the proper allocation of 
expenditures for each development activity between cum nt operating 
expenditures and capital outlays; 
(e) Recommend to the local chief executive COJ ccrned the amount to be a 
allocated for capital under each development activity or infrastructure project; 
(f) Assist the sangguniang panlalawigan in the review and evaluation of budget of 
component cities and municipalities in the case of provincial finance 
committee, the barangay budgets in the case of city or municipal finance 
committee, and recommend the appropriate action thereon; 
(9) Assist the sanggunian concerned in the analysis and 
review of annual 
regular and budgets of the respective local government to determine 
compliance with statutory and administrative requirements; and 
(h) Conduct semi-annual review and general examination of cost 
and 
accomplishments against performance standards applied in undertaking 
development projects. 
A copy of this report shall be furnished the local chief executive and the 
sanggunian concerned, and shall be posted in conspicuous and’ publicly accessible 
places in the provinces, cities, municipalities and barangays. 
SEC. 429. Submission of Budget Proposals by Head of Departments or 
Offices. - (a) Each head of department or office shall submit a budget proposal for his 
department or office to the local chief executive on or before the fifteenth (1 51 11) of 
July of each year: Provided, That the budget proposal of each department or office shall 
be categorized under either economic, social or general services: Provided, further, 
That each service shalt be covered by the budget of at least one ( d )  department or 
office of the local government concerned. 
The said budget proposal shall be prepared in accordance with such policy and 
program as the local chief executive concerned may issue in conformity with he local 
development plan, the budgetary ceilings prescribed by the local finance committee, 
and the general requirements prescribed in this Title. 
(b) Budget proposals of departments or offices shall be divided into two (2) 
Prlmary categories, namely: the current operating expenditures and the 
capital outlays. Such 
budget proposals 
shall contain the following 
information: 
(I 
) Programs, projects and activities showing the general character and 


relative importance of the work to be accomplished or the services to 
ordered, and the cost thereof; 
(2) Organizational charts and staffing patterns indicating the list of plantilla 
positions with their 
corresponding salaries, and 
proposals for 
reclassification of positions and salary changes, as well as the creation of 
new positions with their proposed salary grade, duly supported by proper 
justification; 
(3) Brief description of the programs, projects and activities for the ensuing 
fiscal year, expected results for each program, project and activity, and the 
nature of week to be performed, including the objects of expenditure for 
each program, project and activity; 
(4) Relation of the work and financial pr Josals to approve local development 
plans; 
(5) Estimated current operating expenditures and capital outlays with 
comparative data for the last two (2) preceding, current, and ensuing fiscal 
years; and 
(6) Accomplishment reports for the last two (2) preceeding and current fiscal 
years. 
G. 438. Preparation of the Budget by the Local Chief Executive. - Upon 
receipt of the statements of income and expenditures from the treasurer, the budget 
proposals of the heads of departments and offices, and the estimates of, the regular 
income and budgetary ceilings from the local finance committee, the local chief 
executive shall prepare the executive budget for the ensuing fiscal year in accordance 
with the provisions of this Title. 
The local chief executive shaff submit the said executive budget to the 
sanggunian concerned not later than the sixteenth (1 6th) of October of the current fiscal 
year. Failure to submit such budget on the date prescribed herein shall subject the local 
chief executive to such criminal and administrative penalties as provided for under this 
Code and other applicable laws. 
SEC. 431. Legislative Authorization of the udgel. - On or before the end of 
the current fiscal year, the sanggunian concerned shall enact, through an ordinance, the 
annual budget of the local government for the ensuing fiscal year on the basis of the 
estimates of income and expenditures submitted by the local chief executive. 


. - The ordinance enacting the annual budget 
shall take effect at the beginning of the ensuing calendar year. An ordinance enacting a 
supplemental budget, however, shall take effect upon its approval or on the date fixed 
therein. 
The responsibility for the execution of the annual and supplemental budgets and 
the accountability therefore shall be vested primarily in the local chief executive 
concerned. 
SEC. 433. Changes in the Annuall Budget. All budgetary proposals shall be 
included and considered in the budget preparation process. After the local chief 
executive concerned shall have submitted the executive budget to the sanggunian, no 
ordinance providing for the supplemental budget shall be enacted except when 
supported by funds actually available as certified by local treasurer or by new revenue 
sources. 
A supplemental budget ma) also be enacted in times of public calamity by way of 
budgetary realignment to set aside appropriations for the purchase of supplies and 
materials or the payment of services which are exceptionally urgent or absolutely 
indispensable to prevent imminent danger to, or loss of, life or property, in the 
jurisdiction of the local government or in other areas declared in a state of calamity by 
the President. Such ordinance shall clearly indicate the sources of funds available for 
appropriations, as certified under oath by the local treasurer and local accountant and 
attested to by the local chief executive, and the various items of appropriations affected 
and the reasons for the change. 
SEC. 434. Reversion 
of Unexpected 
of Appropriations, 
Continuing Appropriations. - Balances of appropriations authorized in the annual 
appropriations ordinance shall revert to the surplus of the general fund at the end of the 
fiscal year and shall not thereafter be available for expenditure except by subsequent 
enactment. However, appropriations for capital outlays shafl continue and remain valid 
until fully spent, reverted or the project is completed. 
Reversions of continuing 
appropriations shall not be allowed unless obligations therefor have been fully paid or 
otherwise settled. 


The balances of continuing appropriations shall be reviewed as part of the annual 
budget preparation and the sanggunian concerned may approve, upon recommendation 
of the local chief executive, the reversion of funds no longer needed in connection with 
the activities funded by said continuing appropriations subject to the provisions of this 
Sect ion. 
SEC. 435. Failure to Enact the Annual A
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sanggunnian concerned fails to pass the ordinance authorizing the annual 
appropriations at the beginning of the ensuing fiscal year, it shall continue to hold daily 
sessions, exclusive of Saturdays, Sundays and Holidays, without additional 
remuneration for its members, until such ordinance is approved, and no other business 
may be taken up during such sessions. If the sanggunian still fails to enact such 
ordinance after sixty (60) days from the beginning of the fiscal year, the ordinance 
authorizing the appropriations of the preceding year shall be deemed reenacted and 
shall remain in force and effect until the ordinance authorizing the proposed 
appropriations is passed by the sanggunian concerned. However, only the annual 
appropriations for salaries and wages of existing positions, statutory and contractual 
obligations, and essential operating expenses authorized in the annual and 
supplemental budgets for the preceding year shall be deemed reenacted and 
disbursement of funds shall be in accordance therewith. 
In the implementation of such reenacted ordinance, the local treasurer concerned 
, shall exclude from the estimates of income for the preceding fiscal year those realized 
from nonrecurring sources, like national aids, proceeds from loans. ;ale of assets, prior 
year adjustments, and other analogous sources of income, No ordinance authorizing 
supplemental appropriations shall be passed in place of the annual appropriations. 
In case the revised income estimates be less than the aggregate reenacted 
appropriations, the local treasurer concerned shall accordingly advise the sanggunian 
concerned which shall, within ten (IO) days from the receipt of such advice, make the 
necessary adjustments or reductions. The revised appropriations authorized by the 
sanggunian concerned shall then be the basis for disbursements. 
udgetary ~
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any fiscal year shall comply with the following requirements: 
(a) The aggregate amount appropriated shall not exceed the estimates of 
income; 


(b) Full provision shall be made for all statutory and contractual obligations of the 
local government concerned: Provided, however, that the amount of 
appropriations for debt servicing shall not exceed twenty percent (20%) of the 
regular income of the local government concerned; 
(c) In the case of provinces, cities, and municipalities, aid to component 
barangays shall be in amounts of not 
less than one thousand pesos 
(Php I, 000.00); 
(d) Five percent (5%) of the estimated revenue from regular source shall be set 
aside as an annual lump sum appropriation for unforeseen expenditures 
arising from the occurrence of calamities: Provided, however, That such 
appropriation shall be used only in the area, or a portion thereof, of the local 
government declared in a state of calamity by the governor in the case of a 
province and the mayor in the case of a city or municipality. A copy of the 
declaration shall immediately be furnished the sanggunian of the local 
government concerned. Sanggunian may concur or reject the declaration of 
calamity. In the event of a rejection by the sanggunian of the declaration of 
calamity, no local government funds shall be disbursed therefor. If the 
sanggunian concerned fails to act on the declaration of calamity within 
twenty-four (24) hours from its receipt of the copy of the declaration of 
calamity mentioned above, the same shall be deemed approved. 
u 
SEC. 437. General Limitations. - The use of provincial, city and municipal funds 
shall be subject to the following limitations: 
(a) The appropriations, whether annual or supplemental, for personal services of 
a local government for one (I) 
fiscal year shall not exceed forty-five percent 
(45%) in the case of first to third class provinces, cities and municipalities, 
and fifty-five percent (55%) in the case of fourth class or bwer, of the annual 
income from regular sources realized in the next preceding fiscal year. The 
appropriations for salaries, wages, representation and transportation 
allowances of officials and employees of the public utilities and economic 
enterprises owned, operated and maintained by the local government 
concerned shall not be included in the annual budget or in the computation of 
the maximum amount for personal services. The appropriation for the 
personal services of such economic enterprises shall be charged to their 
respective budgets. 


(b) No official or employee shall be entitled to a salary rate higher than the 
maximum fixed for his position or other positions of equivalent rank by 
applicable laws or rules and regulations issued thereunder; 
(c) No local fund shall be appropriated to increase or adjust salaries or wages of 
officials and employees of the national government, except as may be 
expressly authorized by law; 
(d) In cases of abolition of positions and the creation of new ones resulting from 
the abolition of existing positions in the career service, such abolition or 
creation shall be made in accordance with pertinent provisions of this Code 
and the civil service law, rules and regulations; 
(e) Positions in the official plantilla for career positions, which are occupied by 
Incumbents holding permanent appointments, shall be covered by adequate 
appropriations ; 
(f) No changes in designation or nomenclature of positions resulting in a 
promotion or demotion in rank or increase or decrease in compensation shall 
be allowed, except when the position is actually vacant, and the filling of such 
positions shall be strictly made in accordance with the civil service law, rules 
and regulations; 
(9) The creation of new positions and salary increases or adjustments shall in no 
case be made retroactive; and 
(h) The annual appropriations for discretionary purposes of the local chief 
executive shall not exceed two percent (2%) of the actual receipts derived 
from basic real property tax in the next preceding calendar year. Discretionary 
funds shall be disbursed only for public purposes to be supported by 
appropriate vouchers and subject to such guidelines as may be prescribed by 
law. No amount shall be appropriated for the same purpose except as 
authorized under this Section. 
38. Review of ~~~r~~~~~~~~~ 
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. - The Regional Government 
shall review appropriation ordinances authorizing the annual or supplemental budget of 
provinces and highly urbanized cities in their respective regions except in the National 
Capital Region where the appropriation ordinances of municipalities shall also be 
reviewed by the NCR Regional Government in accordance with the Section immediately 
preceed ing . 
The sangguniang panlalawigan shall review the ordinance authorizing annual or 
supplemental appropriation of component cities and municipalities in the same manner 
and within the same period prescribed for the review of other ordinances. 


If within thirty (30) days from receipt of copies of such ordinance, the sangguian 
panlalawigan takes no action thereon, the same shall be deemed to have been 
reviewed in accordance with law and shall continue to be in full force and effect. If within 
the same period, the sangguniang panlalawigan shali have ascertained that the 
ordinance authorizing annual or supplemental appropriations has not complied with the 
requirements set forth in this Chapter, the sangguniang panlalawigan shall, within the 
period, declare such ordinance inoperative in its entirety or in part. Items of 
appropriation contrary to limitations prescribed in this Chapter or in excess of the 
amounts prescribed herein shall be disallowed or reduced accordingly. 
The sangguniang panlalawigan shall within the same period advice the 
sangguniang panlungsod or sangguniang bayan concerned through the local chief 
executive of any action on the ordinance under review. Upon receipt of such advice, the 
city or municipal treasurer concerned shall not make further disbursement of funds from 
any of the items of appropriation declared inoperative, disallowed or reduced. 
SEC. 439. Duration of Appropriation. - Appropriations for ordinary 
administrative purposes not duly obligated shali terminate with the fiscal year and all 
unexpended balances thereof shall be automatically reverted on the thirty-first (31 51 ) 
day of December of each year to the general fund of the local government. 
Article Five. Barangay Budgets 
SEC. 440. Barangay Funds. - Unless otherwise provided in this Article, all the 
income of the barangay from whatever source including its share of the national taxes 
as provided under in this Code shall accrue to its general fund and shall, at the option of 
the barangay concerned, be dept hereof as trust fund in the custody of the city or 
municipal treasurer, or be released to and deposited for the account of the barangay in 
a bank, preferably government-owned, situated in or nearest to its area of jurisdiction. 
Such funds shall be disbursed pursuant to an approved ordinance by the barangay 
concerned in accordance with the provisions of this Article. Ten percent (AO%) of the 
general fund of the barangay shall be automatically appropriated and obligated for the 
sangguniang kabataan, which shall be released and deposited-to the account of the 
sangguniang kabataan in a bank preferably located within the barangay within twenty 
(20) days after the end of every quarter of the current year. Such funds shall be 
disbursed pursuant to an approved resolution by the sangguniang kabataan concerned. 
, 


for the Barangay Budgets. - On or before the fifteenth (q5th) day of September of 
each year, the barangay treasurer shall submit to the punong barangay a statement 
covering the estimates of income and expenditures for the ensuing fiscal year, based on 
a certified statement issued by the city or municipal treasurer covering the estimates of 
income from local sources for the barangay concerned. 
SEC. 442. Preparation of the 
udget. - (a) Upon receipt of the 
statement of income and expenditures from the barangay treasurer, the punong 
barangay shall prepare the barangay budget for the ensuing fiscal year in the manner 
and within the period prescribed in this Article and submit the annual barangay budget 
to the sangguniang barangay for legislative enactment. 
(b) The total annual appropriations for personal services of a barangay for one 
(I) 
fiscal year shall not exceed fifty-five percent (55%) of the total annual 
income actually realized from local sources during the next preceding fiscal 
year. 
(c) The barangay budget shall likewise be subject to the same budgetary 
requirements and limitations hereinabove prescribed. 
SEC. 443. Effectivity of ~ ~ r ~ n ~ a y  
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annual budget shall take effect at the beginning of the ensuing calendar year. An 
ordinance enacting a supplemental budget, however, shall take effect upon its approval 
or on the date fixed therein. 
The responsibility for the execution of the annual and supplemental budgets and 
the accountability therefor shall be vested primarily in the punong barangay concerned. 
eview of the 
arangay Budget. - (a) Within ten (-IO) from its 
approval, copies of the barangay ordinance authorizing the annual appropriations shall 
be furnished the sangguniang panlungsod or the sangguniang bayan, as the case may 
be, through the city or municipal budget officer. The sanggunian concerned shall have 
the power to review such ordinance in order to ensure that the provisions of this Article 
are complied with. If within sixty (60) days after the receipt of the ordinance, the 
sanggunian concerned takes no action thereon, the same shall continue to be in full 
force and effect. If within the same period, the sanggunian concerned shall have 
ascertained that the ordinance contains appropriations in excess of the estimates of the 
income duly certified as collectible, or that the same has not complied with the 


budgetary requirements set forth in this Article, the said ordinance shall be declared 
inoperative in its entirety or in part. Items of appropriation, contrary to, or in excess of, 
any of the general limitations or the maximum amount prescribed in this Title shall be 
disallowed or reduced accordingly. 
(b) Within the period hereinabove fixed, the sangguniang panlungsod or 
sangguniang bayan concerned shall return the barangay ordinance, through 
the city or municipal budget officer, to the punong barangay with the advice of 
action thereon for proper adjustments, in which event, the barangay shall 
operate on the ordinance authorizing annual appropriations of the preceding 
fiscal year until such time that the new ordinance authorizing annual 
appropriations shall have met the objections raised. Upon receipt of such 
advice, the barangay treasurer or the city or municipal treasurer who has 
custody of the funds shall not make further disbursement from any item of 
appropriation declared inoperative, disallowed, or reduced. 
SEC. 445. Barangay Financial Procedures. - (a) The barangay treasurer shall 
collect all taxes, fees, and other charges due and contributions accruing to the barangay 
for which he shall issue official receipts, and shall deposit all collections with the city or 
municipal treasury or in the depository account maintained in the name of the barangay 
within five (5) days after receipt thereof. He may collect real property taxes and such 
other taxes as may be imposed by a province, city or municipality that are due in his 
barangay only after being deputized by the local treasurer concerned for the purpose. 
(b) The barangay treasurer may be authorized by the sangguniang barangay to 
purchases amounting to not more than one thousand pesos 
make direct 
(Php 1,000.00) at any time for the ordinary and essential needs of the 
barangay. The petty cash that the barangay treasurer may be authorized to 
hold for the purpose shall not exceed twenty percent (20%) of the funds 
available and to the credit of the barangay treasury. 
(c) The financial records of the barangay shall be kept in the office of the city or 
municipal accountant in simplified manner as prescribed by the Commission 
on Audit. Representatives of the Commission on Audit shall audit such 
accounts annually or as often as may be necessary and make a report of the 


audit to the sangguniang panlungsod or sangguniang bayan, as the case may 
be. The Commission on Audit shall prescribe and put into effect-simplified 
procedures for barangay finances within six (6) months following the 
effectivity of this Code. 
Article Six. Expenditures, ~
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SEC. 446. Prohibitions Against Expenditures for 
el ig i ous or Private 
Purposes. - No public money or property shall be appropriated or applied for religious 
or private purposes. 
SEC. 447. Use of Appropriated Funds and Savings. - Funds shall be available 
exclusively for the specific purpose for which they have been appropriated. No 
ordinance shall be passed authorizing any transfer of appropriations from one item to 
another. However, the local chief executive or the presiding officer of the sanggunian 
concerned may, by ordinance, be authorized to augment any item in the approved 
annual budget for their respective offices from savings in other items within the same 
expense class of their respective appropriations. 
SEC. 448. Restriction Upon Limit of Disbursements. - Disbursements in 
accordance with appropriations in the approved annual budget may be made from any 
local fund in the custody of the treasurer, but the total disbursements from any local 
fund shall in no case exceed fifty percent (50%) of the uncollected estimated revenue 
accruing to such local fund in addition to the actual collections: Provided, however, That 
no cash overdraft in any local fund shall be incurred at the end of the fiscal year. 
In case of emergency arising from a typhoon, earthquake, or any other calamity, 
the sanggunian concerned may authorize the local treasurer to continue making 
disbursements from any local fund in his possession in excess of the limitations herein 
provided, but only for such purposes and amounts included in the approved annual 
budgets. 
Any overdraft, which may be incurred at the end ofthe year in any local fund by 
virtue of 
the provisions hereof, shall be covered with the first collections of the 
immediately succeeding fiscal year accruing to such local fund. 


. - No ivoney shall be paid 
on account of any contract under which no services have been rendered or goods 
delivered. 
varices. - No cash advance shall be granted to any local 
official or employee, elective or appointive, unless made in accordance with rules and 
regulations as the COA may prescribe. 
SEC. 451. Persons Accountable for Local overnment Funds. - Any officer 
of the local government whose duty permits or requires the possession or custody of 
local government funds shall be accountable and responsible for the safekeeping 
thereof in conformity with the provisions of this Title. Other local officers who, though not 
accountable by the nature of their duties, may likewise be similarly held accountable 
and responsible for local government funds through their participation in the use or 
application thereof. 
SEC. 452. Prohibitions ~~~~n~~ ~~~~~a~ interest. - Without prejudice to 
criminal prosecution under applicable laws, any local treasurer, accountant, budget 
officer, or other accountable local officer having any pecuniary interest, direct or indirect, 
in any contract, work or other business of the local government of which he is an 
accountable officer shall be administratively liable therefor. 
3. Liability for Acts Done Upon Direction of 
uperior Officer, or 
Upon Participation of Other ~
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Unless he registers his objection in writing, the local treasurer, accountant, budget 
officer, or other accountable officer shall not be relieved of liability for illegal or improper 
use or application or deposit of government funds or property by reason of his having 
acted upon the direction of a superior officer, elective or appointive, or upon 
participation of other department heads or officers of equivalent rank. The superior 
officer directing, or the department head participating in such illegal or improper use or 
application or deposit of government funds or property, shall be jointly and severally 
liable with the local treasurer, accountant, budget officer, or other accountable officer for 
the sum or property so illegally or improperly used, applied or deposited. 


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No money shall be appropriated, used, or paid for entertainment or reception except to 
the extent of the representation allowances authorized by law or for the reception of 
visiting dignitaries of foreign governments or foreign missions, or when expressly 
authorized by the President in specific cases. 
SEC. 
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disbursed unless the local budget officer certifies to the existence of appropriation that 
has been legally made for the purpose, the local accountant has obligated said 
appropriation, and the local treasurer certifies to the availability of funds for the purpose. 
Vouchers and payrolls shall be certified to an approved by the head of the department 
or office that has administrative control of he fund concerned as to validity, propriety, 
and legality of the claim involved. Except in cases of disbursements involving regularly 
recurring administrative expenses such as payrolls for regular or permanent employees, 
expenses for light, water, telephone and telegraph services, remittances to government 
creditor agencies such as the GSIS, SSS, LBP, DBP, National Printing Office 
Procurement Service of the DBM and others, approval of the disbursement voucher by 
the local chief executive or by the Department Heads or Chiefs of Hospitals duly 
authorized by the local chief executive concerned, shall be required whenever local 
funds are disbursed. 
In cases of special or trust funds, disbursements shall be approved by the 
administrator of the fund. 
In case of temporary absence or incapacity of the department head or chief of 
office, the officer next in rank shall automatically perform his function and he shall be 
fully responsible therefor. 
EC. 456. Officials ~
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to Draw Checks in editlernent of Obligation - 
Checks in settlement of obligations shall be drawn by the treasurer and countersigned 
by the local chief executive, or in hislher absence, by an official designated by him in 
consonance with law. 
Checks in settlement of obligations duly appropriated for personal services, 
maintenance and other operating expenses and capital outlay of the sanggunian shall 
be countersigned by the Vice Governor or the Vice-Mayor for the province, city or 
municipality, as the case may be, or in his/her absence, by an official duly authorized by 
law. 


In case of the absence of the treasurer for more than three (3) days, the signing 
of the checks above mentioned shall be dine by the Assistant Treasurer or an official 
designated as officer incharge of office in accordance with law. 
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Checks issued in settlement of obli' ations of the barangay, shall be signed by 
the barangay treasurer shall be properly bonded, and countersigned by the punong 
barangay. In the absence of either or bot I: of them for more than three (3) days, the 
sangguniang barangay, by majority vote, hall designate from among themselves two 
(2) members who shall be signatories to th checks. i 
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SEC. 457. Disbursements of Lo aB Fun 
Disbursements shall be made in accordan e with the ordinance authorizing the annual 
or supplemental appropriations without the prior approval of the sanggunian concerned. 
Within thirty (30) days after the close of e ch month, the local accountant shall furnish 
the sanggunian with such financial st tements as may be prescribed by the 
Commission on Audit. In the case of the 1 
ear end statement of accounts, the period 
shall be sixty (60) days after the thirty-first 31 st) of December. 
endition of Account 1 
. - Local treasurers, accountants and other 
local accountable officers shall render th ir accounts within such time, in such form, 
style, and content and under such reg 1 
Mons as the Commission on Audit may 
Provincial, city, and municipal audi ors shall certify the balances arising in the 
accounts settled by them to the Chairman /of the Commission on Audit and to the local 
treasurer, accountant, and other accountable officers. Copies of the certification shall be 
prepared and furnished other local officers who may be hdd jointly and severally liable 
for any loss or illegal, improper or unauthorized use or misappropriation of local funds or 
prescribe. 
property. 
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- The books, accounts, papers, and cash of 
local treasurer, accountant, budget officer, or other accountable officers shall at all times 
be open for inspection of the Cornmission on Audit or its duly authorized representative. 
In case an examination of the accounts of a local treasu'rer discloses a shortage 
in cash which should be on hand, it shall be the duty of the examining officer to seize 
the office and its contents, notify the Commission on Audit, the local chief executive 


concerned, and the local accountant. Thereupon, the examining officer shall 
immediately turn over to the accountable officer next-in- rank in the local treasury 
service, unless the said officer is likewise under investigation, the office of tll e treasurer 
and its contents, and close and render his accounts on the date of turnover. in case the 
accountable officer next-in-rank is under investigation, the auditor shall take full 
possession of the office and its contents, close and render his accounts on the date of 
taking possession, and temporarily continue the public business of such office until such 
time that the local treasurer is restored or a successor has been duly designated. The 
local treasurer or accountable officer found with such shortage shall be automatically 
suspended from office. 
SEC. 460. Accountin 
evenues. - Estimated revenues, which remain 
unrealized at the close of the fiscal year, shall not be booked or credited to the 
unappropriated surplus or any other account. 
ccsunting for Obligations. - All lawful expenditures and obligations 
incurred during a fiscal year shall be taken up in the accounts of that year. 
eneral Liability for Unlawful ~
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funds or use of property in violation of this Title and other laws shall be a personal 
liability of the official or employee responsible therefor. 
SEC. 463. Posting of the 
~~~a~ 
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treasurers, accountants, budget officers and other accountable officers shall, within 
thirty (30) days from the end of each fiscal year, post in at least three (3) publicly 
accessible and conspicuous places such as plaza and main street in the local 
government concerned, and to publish said statements of income and expenditures in a 
newspaper of general circulation, where available, in the territorial jurisdiction of such 
unit, a summary of all revenues collected and funds received including the 
appropriations, and disbursements of such funds during the preceding fiscal year. 
Failure to cornply with this requirement shall subject the officials concerned to 
disciplinary action in accordance with the existing laws. 
4. Title ~
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Year. - The official fiscal year of local 
governments shall be the period beginning with the first day of January and ending with 
the thirty-first (31 st) day of December of the same year. 


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Secretary of Budget and Management jointly with the Chairman of the Commission on 
Audit, and the chairman of the Regional Government elected by a majority vote of all 
the chairmen of the Regional Governments in the entire country shall, within one (I) year 
from the effectivity of this Code, review the existing budget operations manual and 
promulgate a new Manual for local governments to improve and systematize methods, 
techniques, and procedures employed in budget preparation, authorization, execution, 
and accountability:. Provided, That pending the promulgation of the updated Manual, 
existing laws, rules and regulations shall continue to apply; Provided, however, That 
said statutes or regulations or portions thereof have not been modified, amended, 
rescinded, or repealed by this Code. 
Chapter 6 
Property and Supply Management in the Local Governments 
SEC. 466. Scope. - This Chapter shall govern the procurement, care, utilization, 
custody, and disposal of supplies, as defined herein, by local governments and the 
other aspects of supply management at the local levels. 
It is mandated that local governments shall introduce computer technology where 
compatible with effective internal controls and with the aim in view of achieving 
efficiency, transparency and modernization of property and supply management therein. 
SEC. 467. General Rule in ~
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or Disposal. - Except as otherwise 
provided herein, local governments are authorized to directly acquire or procure 
supplies and equipment from either local or foreign suppliers through competitive public 
bidding, without need of prior approval or authority from any agency of the government. 
Supplies which have become unserviceable or no longer needed shall be sold, 
whenever applicable, at public auction, subject to applicable rules and regulations. 
SEC. 468. Definition of Term , - When used in this Chapter, the term - 
(a) Lowest Complying and Responsible Bid" refers to the proposal of one who 
offers the lowest price, meets all the technical specifications and 
requirements of the supplies desired and, as a dealer in the line of supplies 
involved, maintains a regular establishment, and has complied consistently 
with previous commitments; 


(b) "Suitable Substitute" refers to that kind of article which would 
serve 
substantially the same purpose or produce substantially the same results as 
the brand, type, or make of article originally desired or requisitioned; 
(c) "Supplies" includes everything, except real property, which may be needed in 
the transaction of public business or in the pursuit of any undertaking, project, 
or activity, whether in the nature of equipment, furniture, stationary materials 
for construction or personal property of any sort, including non-personal or 
contractual services such as the repair and maintenance of equipment and 
furniture, as well as trucking, hauling, janitorial, security, and related services; 
and 
(d) "Terms and Conditions" refer to other requirements not affecting the technical 
specifications and requirements of the required supplies desired such as 
bonding of the terms delivery and payment, and related preferences. 
9. Requirement of Requisition. - Any order for supplies shall be filled 
by the provincial or city general services officer or the municipal or barangay treasurer 
concerned, as the case may be, for any office or department of a local government only 
upon written requisition as hereinafter provided. 
EC. 470. Officers Having Authority to Draw 
, - Requisitions 
shall be prepared by the head of office or department needing the supplies, which shall 
certify as to their necessity for official use and specify the project or activity where the 
supplies are to be used. 
SEC. 471. Certification by %he Local 
Treasurer. - Every requisition must be accompanied by a certificate signed by the 
local budget officer, the local accountant, and the local treasurer showing that an 
appropriation therefor exists, the estimated amount of such expenditure has been 
obligated, and the funds are available for the purpose, respectively. 
pproval of Requisitions. - Approval of the requisition by the head of 
office or department concerned who has administrative control of the appropriation 
against which the proposed expenditure is chargeable is deemed sufficient, except in 
case of requisition for supplies to be carried in stock which shall be approved by the 
local chief executive concerned: Provided, That such supplies are listed or included in 


the annual procurement plan and .the maximum quantity thereof does not exceed the 
estimated consumption corresponding to a programmed three-month period: Provided, 
further, That nothing herein contained shall be held as authorizing the purchase of 
furniture and equipment for stock purposes. 
SEC. 473. Local ~ ~ e ~ u a i i ~ ~ ~ a ~ ~ ~ ~ ,  
Bids 
Committee (Local 
PBAC). (a) There is hereby created a local prequalification, bids and awards committee 
in every province, city, and municipality, which shall be primarily responsible for the 
conduct of prequalification of 
contractors, bidding, evaluation of bids, and the 
recommendation of awards concerning local infrastructure projects. The governor or the 
city or municipal mayor shall act as the chairman with the following as members: 
(I 
) The chairman of the appropriations committee of the sanggunian concerned; 
(2) A representative of the minority party in the sanggunian concerned, if any, or 
if there be none, one (1) chosen by said sanggunian from among its 
members; 
(3) The local treasurer; 
4) Two (2) representatives of 
nongovernmental organizations 
that 
are 
represented in the local development council concerned, to be chosen by the 
organizations themselves; and 
(5) Any 
practicing certified 
public accountant from the private sector, to be 
designated by the local chapter of the Philippine Institute of Certified Public 
Accountants, if any. 
Representatives of the Commission on Audit shall observe the proceedings of 
such committee and shall certify that the rules and procedures for prequalification, bids 
and awards have been complied with. 
(b) The agenda .and other information relevant 
to the meetings of such 
committee shall be deliberated upon by the committee at least one (I) 
week 
before the holding of such meetings. 
(c) All meetings of the committee shall be held in the provincial capitol or the city 
Or municipal hall. The minutes of such meetings of the committee and any 
decision made therein shall be duly recorded, posted at a prominent place in 
the provincial capitol or the city or municipal hall, and delivered by the most 
expedient means to elective local officials concerned. 


technical committee in every province, city and municipality to provide technical 
assistance to the local prequalification, bids and awards committees. It shall be 
composed of the provincial, city or municipal engineer, the local planning and 
development coordinator, and such other officials designated by the local 
prequalification, bid and awards committee. 
(b) The chairman of the 
local technical committee shall be designated by the 
local prequalification, bids and awards committee and shall attend its meeting 
in order to present the reports and recommendations of the committee. 
SEC. 475. Call for 
ids. - When procurement is to be made by local 
governments, the provincial or city general services officer or the municipal or barangay 
treasurer 
shall call bids for open public competition. The call for bids shall show the 
complete specifications and technical descriptions of the required supplies and shall 
embody all terms and conditions of participation and award, terms of delivery and 
payment, and all other covenants affecting the transaction. In all calls for bids, the right 
to waive any defect in the tender as well as the right to accept the bid most 
advantageous to the government shall be reserved. In no case, however, shall failure to 
meet the specifications or technical requirements of the supplies desired be waived. 
SEC. 476. Publication of Call for Bids. - The call for bids shall be given the 
widest publicity possible, sending, by mail or otherwise, any known prospective 
participant in the locality, of copies of the call and by posting copies of the same in at 
least three (3) publicly accessible and conspicuous places in the provincial capitol or 
city, municipal, or barangay hall, as the case may be. 
The notice of the bidding may likewise be published in a newspaper of general 
circulation in the territorial jurisdiction of the local government concerned when the 
provincial or city general services officer or the municipal or barangay treasurer, as the 
case may be, deems it necessary in order to obtain the lowest responsible and 
complying bid. 
The opening of bids shall only be made in the presence of the provincial or city 
auditor or his duly authorized representative who shall initial and secure copies of the 
bids and certify the abstract of the bidding. 


SEC. 4.77. "$he 
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on Awards. - There shall be ir: every province, city 
or municipality a Committee on Awards to decide the winning bids and questions of 
awards and procurement and disposal of property. 
The Committee on Awards shall be composed of the local chief executive as 
chairman, the local treasurer, the local accountant, the local budget officer, the local 
general services officer, the head of office or department for whose use the supplies are 
being procured, one (I) representative of the Philippine institute of Certified Public 
Accountants (PICP A), and two (2) representatives of non-governmental organizations 
that are represented in the local development council concerned to be chosen by the 
organizations themselv_es, as members. In case a head of office or department would sit 
in a dual capacity, a member of the sanggunian elected from among its members shall 
sit as a member. The Committee on Awards at the barangay level shall be the 
sangguniang barangay. No national official shall sit as a member of the Committee on 
Awards. 
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The results of the bidding shall be made public by posting the same in a 
conspicuous place in the provincial capitol or city, municipal, or barangay hall. 
c. 
s. - Awards in the procurement of supplies shall be 
given to the lowest complying and responsible bid which meets all the terms and 
conditions of the contract or undertaking. 
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may be made without the benefit of public bidding under any of the following modes: 
(a) Personal canvass of responsible merchants; 
(b) Emergency purchase; 
(c) Negotiated purchase; 
(d) Direct purchase from manufacturers or exclusive distributors; and 
(e) Purchase from other government entities. 
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. - Upon approval by the 
Committee on Awards, procurement of supplies may be effected after personal canvass 
of at least three (3) responsible suppliers in the locality by a committee of four (4) 
composed of the local general services officer or the municipal or barangay treasurer, 
as the case may be, the local accountant, the head of office or department for whose 
use the supplies are- being procured, and a representative of non-governmental 
organization. The awards shall be decided by the Committee on A wards. The 


acquisition and procurement by local governments of supplies, goods, equipment and 
services, except consultants as authorized by the sanggunian concerned through 
personal canvass. 
Purchases shall not exceed twenty-five percent (25%) of the total amount 
allocated for the purpose in anyone ( I )  month. The services purchased through personal 
canvass shall be performed and completed within a period of thirty (30) days from the 
date of purchase. 
~~~~~~~. - In cases of emergency where the need for 
the supplies is exceptionally urgent or absolutely indispensable and only to prevent 
imminent danger to, or loss of, life or property, local governments may, through the local 
chief executive concerned, make emergency purchases or place repair orders, 
regardless of amount, without public bidding. Delivery of purchase orders or utilization 
of repair orders pursuant to this Section shall be made within ten (10) days after 
placement of the same. Immediately after the emergency purchase or repair order is 
made, the chief of office or department making the emergency purchase or repair order 
shall draw a regular requisition to cover the same, which shall contain the following: 
(a) A complete description of the supplies acquired or the work done or to be 
performed; 
(b) By whom furnished or executed; 
(c) Date of placing the order and the date and time of delivery or execution 
(d) The unit price and the total contract price; 
(e) A brief and concise explanation of the circumstances why procurement was 
of such urgency that the same could not be done through the regular course 
.
.
 . 
without involving danger to, or loss of, life or property; 
(f) A certification of the provincial or city general services or the municipal or 
Barangay treasurer, as the case may be, to the effect that the price paid or 
contracted for was the lowest at the time of procurement; and 
(9) A certification of the local budget officer as to the existence of appropriations 
for the purpose, the local accountant as to the obligation of the amount 
involved, and the local treasurer 2s to the availability of funds. 
The goods or services procured under this Section must be utilized or availed of 
within fifteen (1 5) days from the date of delivery or availability. 
Without prejudice to criminal prosecution under applicable laws, the local chief 


executive, the head of department, or the chief of office making the procurement shall 
be administratively liable for any violation of this Section and shall be a ground for 
suspension or dismissal from service. 
c. 
(a) In cases where public biddings have failed for two (2) consecutive times and 
no suppliers have qualified to participate or win in the biddings, local 
governments may, through the local chief executive concerned, undertake the 
procurement of supplies by negotiated purchase, regardless of amount, 
without public bidding: Provided, however, That the contract covering the 
negotiated purchase shall be approved by the sanggunian concerned. 
Delivery of purchase orders or utiiization of repair orders pursuant to this 
Section shall be made within seven (7) days after placement of the same. 
Immediately after the negotiated purchase or repair order is made, the local 
chief executive concerned shall draw a regular requisition to cover the same, 
which shall contain the following: 
(1 ) A complete description of the supplies acquired or the work done or to 
be performed; 
(2) By whom furnished or executed; 
(3) Date of placing the order and the date and time of delivery or 
execution ; 
(4) The unit price and the total contract price; 
(5) A certification of the provincial or city general services or the municipal 
or barangay treasurer, as the case may be, to the effect that the price 
paid or contracted for was the lowest at the time of procurement; 
__ 
.c 
.+ 
- 
(6) A certification to the effect that the price paid or contracted for was the 
lowest at the time of procurement; and 
(7) A certification of the local budget officer as to the existence of 
appopriations or the purpose, the local accountant as to the obligation 
of the amount involved, and the local treasurer as to the availability of 
funds. 
(b) In case of repeat orders for regular supplies, procurement may be made by 
Negotiated purchase; Provided, That the repeat order is made within six (6) 
months from the last procurement of the same item: Provided, further, That 
the same terms and conditions of sale are obtained for the said repeat order. 


~~~~~~~~~~~, - Procurement 
may be made directly from duly licensed manufacturers in cases of supplies of 
Philippine manufacture or origin and in case there are two (2) or more manufacturers of 
the required supplies, canvass of the known manufacturers shall be conducted to obtain 
the lowest price for the quality of the said supplies. 
- - 2  
Procurement may, in the case of supplies of foreign origin, preferably be made directly 
from the exclusive or reputable Philippine distributors or agents, subject to the following 
conditions: 
(a) That the Philippine distributor has no subdealers selling at lower prices; and 
(b) That no suitable substitutes of substantially the same quality are ava'ilable'at I 
lower prices. 
5. 
~~~~~~~. - Procurement may be 
made directly from government entities producing the required supplies, including units 
or agencies of foreign governments with which the Philippines maintains diplomatic 
relations. In the latter case, prior authority from the Office of the President shall be 
required. 
. - (a) On or before the fifteenth (1 5th) 
day of July each year, the local chief executive shall prepare an annual procurement 
program for the ensuing fiscal year which shall contain an itemized list of the estimated 
quantity of supplies needed for such year, a complete description thereof as to kind, 
quality, estimated cost, and balance on hand: Provided, however, That the total 
estimated cost of the approved annual procurement program shall not exceed the total 
appropriations authorized for the acquisition of supplies. The local governments may 
augment the supplies and equipment provided by the Supreme Court to the lower 
courts located in their-respective jurisdictions. 
(b) Except in emergency cases or where urgent indispensable needs could not 
have been reasonably anticipated, no purchase of supplies shall be made 
unless included in, or covered by, the approved procurement program. 


(c) The conversion of excess cash in,to supplies stock is hereby prohibited except 
to the extent of the kind and quantity specified in the approved annual 
procurement plan. 
A violation of this Section shall be a ground for suspension or dismissal of any 
official or employee responsible therefor. 
y
~
~
~
~
.
 
- Every local government 
shall provide for the establishment of an archival system to ensure the safety and 
protection of all government property, public documents or records such as records of 
births, marriages, property inventory, land assessments, land ownership, tax payments, 
tax accounts, and bisiness permits, and such other records or documents of public 
interest in the various departments and offices of the provincial, city, or municipal 
government concerned. 
- (a) Each head of department or office of a province, city, municipality or barangay shall 
be primarily accountable for all government property assigned or issued to his 
department or office. The person or persons entrusted with the possession or custody of 
government property under the accountability of any head of deparlment or office 
.
.
 shall 
be immediately accountable to such officer. 
(c) The head of a department or office primarily accountable for government 
property may any person in possession of the property or having custody and 
control thereof under him to keep such records and make reports as may be 
necessary for his own information and protection. 
(c) Buildings and other physical structures shall be under the accountability and 
responsibility of the provincial or city general services officer or the municipal 
mayor or punong barangay, as the case may be. 
(d) Every officer primarily accountable for government property shall keep a 
complete record of all properties under his charge and render his accounts 
therefor semi annually to the provincial or city general services officer or the 
municipal mayor or punong barangay, as the case may be. 


SEC. 489. Res 
~~~~~~~~~~ 
for Pro 
88 and Case of ~~~~~~~~~~ 
~~~~~~~~~. - 
The person in actual physical possession of goverment property or entrusted with its 
custody and control shall be responsible for its proper use and care and shall exercise 
due diligence in the utilization and safekeeping thereof. 
he person immediately accountable for government property shall be 
liable for its money value in case of the illegal, improper or unauthorized use or 
misapplication thereof, by himself or any other person for whose acts he may be 
responsible, and he shall be liable for all loss, damage, or deterioration occasioned by 
negligence in the keeping or use of such property un!ess it is proved that he has 
exercised due diligence and care in the utilization and safekeeping thereof. 
(b) Unless he registers his objection in writing, an accountable person shall not 
be relieved from liability by reason of his having acted under the direction of a 
superior officer in using property with which he is chargeable; but the officer 
directing any illegal, unauthorized or improper use of property shall first be 
required to - answer therefor. 
./ 
” *  - 
(d) In cases of loss, damage, or deterioration of government property arising 
from, or attributable to, negligence in security, the head of the security agency 
shall be held liable therefor. 
loss of government property occurs while the same is in transit or is caused by fire, 
theft, force majeure, or other casualty, the officer accountable therefor or having 
custody thereof shall immediately notify the provincial or city auditor concerned.within 
thirty (30) days from the date the loss occurred or for such longer period as the 
provincial, city or municipal auditor, as the case may be, may in the particular case 
allow, and he shall present his application for relief, with the available evidence in 
support thereof. An officer who fails to comply with this requirement shall not be relieved 
of liability or allowed credit for any such loss in the settlement of his accounts. 
A provincial, city or municipal auditor shall not allow credit for these losses unless 
so expressly authorized by the Chairman of the Commission on Audit, to be execised 
only if the 105s is not in excess of fifty thousand pesos (Php50, 000.00). In any case 
when the allowance of credit is not within the competence of the provincial, city or 


municipal auditor, the application and evidence, with the recommendation of the auditor 
concerned, shall be forwarded to the Chairman of the Commission on Audit for his 
appropriate action. 
8. - When property of any lccai government has 
become unserviceable for any cause or is no longer needed, it shall, upon application of 
the officer accountable therefor, be inspected and appraised' by the provincial, city or 
municipal auditor, as the case may be, or his duly authorized representative or 'that of 
the Commission on Audit and, if found valueless or unusable, shall be destroyed in the 
presence of the inspecting officer. 
If found valuable, the same shall be sold at public auction to the highest bidder 
under the supervision of the committee on awards and in the presence of the provincial, 
city or municipal auditor or his duly authorized representative. Notice of the public 
auction shall be posted in at least three (3) publicly accessibte and conspicuous places, 
and if the acquisition cost exceeds one hundred thousand pesos (Php 100,000.00) in 
the case of provinces and cities, and fifty thousand (Php50,000.00) in the case of 
municipalities, notice of auction shall be published at least two (2) times within a 
reasonable period in a newspaper of general circulation in the locality. 
tiate 
y. - Property no longer needed may also 
be disposed of at a private sale at such price as may be determined by the committee 
on awards, subject to the approval ofthe Commission on Audit or its duly authorized 
representative when the acquisition or transfer cost of the property exceeds fifty 
thousand pesos (Php50,000.00) in the case of provinces and cities, and twenty five 
thousand (Php25, 000.00) in the case of municipalities and barangays. 
In case of real property, the disposal shall be subject to the approval of the 
Commission on Audit regardless of the value or cost involved. 
t. - Property, which has become unserviceable 
or is no longer needed, may be transferred without cost to another office, agency, 
subdivision or instrumentality of the national government or another local government at 
an appraised valuation determined by the local committee on awards. Such transfer 
shall be subject to the approval of the sanggunian concerned making the transfer and 
by the head of the office, agency, subdivision, instrumeniality or local government 
receiving the property. 


5. "I'rax 
~~~~~~~~~ 
of Lscal 
governments shall be exempt from the payment of duties and taxes for the importation 
of heavy equipment or machineries which shall be used for the construction, 
improvement, repair, and maintenance of roads, bridges and other infrastructure 
projects, as well as garbage trucks, fire trucks, and other similar equipment: Provided, 
however, That such G-uipment or machineries shall not be disposed of, either by public 
auction or negotiated sale as hereinabove provided, within five (5) years from the 
importation thereof. In case the machinery or equipment is sold within the five-year 
period, the purchasers or recipients shall be considered the importers thereof, and shall 
be liable for duties and taxes computed on the book value of such importation. 
tions. - Within one (I) 
year after the 
effectivity of this act, the Chairman of the Commission on Audit, jointly with the 
chairman of the Regional Government elected by a majority vote of ail the chairmen of 
the Regional Governments in the entire country, shaH review the exiting rules and 
regulations governing property and supply management in the local governments and 
promulgate the rules and regulations necessary to effectively implement the provisions 
of this Title and install an efficient, effective and transparent property and supply 
management system: Provided, That pending the promulgation of such rules and 
regulations the existing law, rules and regulations shall continue to apply. 
n. - The "Local Government Bank of the Philippines", 
hereinafter referred to as the Bank, is hereby established. The Bank shall be a body 
corporate and shall exist for a period of fifty (50) years. 
The primary purposes of the Bank are to provide efficient and responsive general 
banking services to local governments and to maximize the grant to them of loans, 
credits and other forms of indebtedness out of its loanable funds to finance local 
infrastructure- and 0th-er socio-economic development projects as well as to stabilize 
local finances pursuant to Chapter Four, this Title: Provided, however, That the pursuit 
of these objectives shall be undertaken within the context of a financially viable and 
stable banking institution. 
The Bank's principal office and place of business shall be in the national capital 
region, also known as Metro Manila. It may open and maintain branches, agencies, or 


other offices ai such places in the Philippines as its Board of Directors may deem 
advisable with the approvable of the Monetary Board of the Bangko Sentral ng Pilipinas, 
hereafter referred to as Bangko Sentral. 
~~~~~. - The Bank shall have the power: 
(a) To adopt, amend, or change its by-laws, to determine its operating policies, 
and to issue such rules and regulations as may be necessary to achieve the 
main purpose for the creation of the Bank; 
(b) To adopt alter and use a corporate seal; 
(c) To acquire and own real and personal property, and to sell, mortgage or 
otherwise dispose of the same; 
stocks, bonds, or other securities capable of giving the bank a reasonably 
assured income to augment its loanable fund; 
-4 - 
(d) To hold, own, purchase, acquire, sell or otherwise invest or re-invest in 
(e) To act as official depository of local government funds pursuant to the 
provisions of this Code; 
(f) To accept savings and time deposits from the public in areas where facilities 
for such a service do not exist or can not be adequately provided by other 
deposit institutions under the supervision of the monetary board ofthe Bangko 
Sentral; 
(f) To sue and be sued, make contracts and borrow money from both local and 
Foreign sources. Such loans shall be subject to approval by the President of 
the Philippines and fully guaranteed by the government of the Philippines. 
ital. - The capital of the 
Bank shall be fifty billion pesos 
(Php50,000,000,000.00), to be fully subscribed by the government of the Republic of 
the Philippines, hereafter referred to 
as the 
government. Ten 
billion pesos 
(Php IO, 000,000,000) shall be fully paid for by the government upon effectivity of this 
act and the balance to be paid for within a period of two (2) years from the effectivity of 
this action in such manner and from as the government, through the Secretary of 
Finance and the Secretary of Budget and Management, may thereafter determine. 
5, - The Bank may issue all kinds of bonds, 
debentures, and securities, and/or the renewal or refunding thereof (hereinafter called 
"bonds"), within and/or outside the Philippines, at such terms, rates and conditions as 


.
.
 
the board of directors of the Bank may determine, subject to compliance with the 
provisions of applicable law, and rules and regulations promulgated by the Monetary 
Board. 
The Bank shall provide for appropriate reserves for the redemption or retirement 
of the bonds. These bonds and other obligations shall be redeemable at the option of 
the Bank at or before maturity and in such manner as may be stipulated therein and 
shall bear such rate of interest as may be fixed by the Bank. 
Such obligations shall be secured by the assets of the Bank, including the stocks, 
bonds, debentures, and other securities purchased or held by it under the provisions of 
this Code, these bonds and debentures may be tong-term, medium-term, or short-term, 
with fixed interest rate or floating interest rate. 
affairs and business of the bank shall be directed and it’s properties managed and 
preserved and its corporate powers exercised, by a board of directors consisting of nine 
(9)  member^,. to be appointed by the President of the Philippines. The term of office of 
the chairman, Vice-chairman, and the members of the board of directors shall be for a 
period of one (I) 
year or until such time as their successors are appointed. 
The Chairman and the vice-chairman of the board shall be appointed by the 
President of the Philippines. The Vice-Chairman of the board shall assist the chairman 
and act in his stead in case of absence or incapacity. In case of incapacity or absence 
of both the chairman and Vice Chairman, the board of directors shall designate a 
temporary chairman from among its members. 
.
.
 
No person shall be elected director of the Bank unless he is a natural born citizen 
of the Philippines, not less than thirty-five (35) years of age, of good moral character 
and has attained proficiency, expertise and recognized competence in one or more of 
the following: banking, finance, economics, law, agriculture, business management, 
public utility or government administration. 
Except for the chairman and the vice-chairman of the board, no officer or 
employee of the Bank may be appointed as a member of the board of directors of the 
Bank; nor shall any director officer, or employee of any other Bank be eligible as a 
member of the board of directors of the Bank. Unless otherwise set by the board and 


. 
.- 
approved by the President of the Philippines, members of the board shall be paid a per 
diem of five thousand pesos (Php5, 000.00) for each meeting of the board of directors 
actually attended: Provided, that the total amount of per diems for every single month 
shall not exceed the sum of fifty thousand pesos (Php50, 000.00). 
. - The board of 
directors shall have, among others, the following duties, powers and authority: 
(a) To formulate policies necessary to carry out effectively the provisions ofthis 
Code and to prescribe, amend, and repeal by-laws, rules and regulations for 
the effective operation of the Bank, and the manner in which the general 
business of the Bank may be conducted and the powers granted by law to the 
Bank exercised; 
(b) To approve loans, to fix rates of interest on loans and to prescribe such terms 
and conditions for loans and credits as may be deemed necessary, consistent 
with the provisions of this Code; Provided, that the board may delegate the 
authority to approve loans to such officer or officers as may be deemed 
necessary; 
c) To adopt an annual budget for the effective operation and administration of the 
Bank; 
(d)To create and establish a "provident fund" which shall consist of contributors, 
made both by the Bank and its officers or employees, to a common fund for 
the payment of benefits to such ofiicers or employees, or their heirs, under 
such terms and conditions as the board of directors may fix: 
l 
(e) To compromise or release, in whole or in part, any claim of or settled liability 
to the Bank 
- regardless of the amount involved, under such terms and 
cznditions it may impose to protect the interests of the Bank. This authority to 
compromise shall extend to claims against the bank; and 
.- 
(f) To appoint, promote or remove officers from the rank of the vice president or 
Its equivalent, and other more senior officer positions, excluding the chairman 
and vice chairman. 
r. - The chairman shall be the 
chief executive officer of the bank and, as such, shall, on behalf of the board have the 
direction and control of the business affairs and properties of the bank in all matters 
which are not by this Code or by the by-laws of the bank specifically reserved to be 
done by the board or other officers of the bank. For this purpose, he shall, among other 
powers and duties, execute, carry out, and administer the policies, measures, orders, 
and resolutions approved by the board; direct and supervise the operation and 


administration of the Bank; Exercise such other powers and perform such other function 
or duties as may de directed or assigned to him by law or by the board from time to 
time. 
Particularly, he shall have the power and duty: 
- 
_ /  
.- - 
(a) To sign and execute all contracts concluded by the Bank and other into all 
necessary obligations required or permitted by this Code, upon proper 
authorization by the board;and sign all notes, securities, certificates, and 
other major documents of the Bank; 
(b) To exercise, as chief executive officer or the Bank, the powers of control and 
Supervision over decisions and actions of subordinate officers and all other 
powers that mat be granted by the board; 
(c) To report to the board the main facts concerning the operations of the Bank 
and to recommend changes in policies which he may deem advisable; . 
(d) To submit an annual report to the President of the Philippines on the result of 
(e) To recommend to the board the appointment, promotion, or removal of all 
the operations of the Bank; 
officers of the Bank, with the rank of at least vice president or its equivalent; 
(f) To appoint, promote or remove employees and officers below the rank of vice 
president or its equivalent; provided, that promotions, transfers, assignments 
or reassignments of officers and personnel of the Bank are personnel actions 
deemed made in the interest of the service and not disciplinary, any 
provisions of the civil service law to the contrary notwithstanding; and 
(9) As required by circumstances, to delegate any of his powers, duties or 
functions to any officer or director of the Bank, with the approval of the board. 
an 
icer. - The vice-chairman 
shall be the chief operating officer of the Bank and shall assume and exercise such 
specific duties and responsibilities as may be delegated to him by the chairman. 
rz - The Chairman of the Commission on Audit shall be the ex- 
officio auditor of the Bank and shall appoint a representative, who shall be the auditor in 
charge of the auditing office of the Bank. The Commission on Audit Chairman shall, 
upon the recommendation of the auditor of the Bank, appoint or remove the personnel 
of the auditing office. The compensation, budget and operating expenses of the auditing 


office aiid the salaries and traveling expenses of the officers and employees thereof 
shall be fixed by the board of trustees and paid by the Bank notwithstanding any 
provision of law to the contrary. 
1 - The Sank shall have its own legal 
department, the head of which shall be appointed by the board of directors of the Bank 
upon recommendation of the chairman. 
In appropriate cases, the Bank may avail also of the legal services of any 
government legal off ice authorized to render such services to government-owned or 
controlled corporations. 
The Bank may, upon the recommendation of its chief legal counsel, deputize any 
member of-its legal staff to act as special sheriff in foreclosure cases, in the sale or 
attachment of the debtor's praperties, and in the enforcement of court writs and 
processed in cases involving the Bank. The special sheriff of the Bank shall make a 
report to the proper court after any action taken by him, which shall treat such action as 
if it were an act of its own sheriffs in all respects. 
8. - The board of directors shall 
provide for an organization and staff of officers and employees of the Bank and upon 
recommendation of the chairman of the board, fixes their remunerations and other 
emoluments. No officer or employee of the Bank subject to civil service law shall be 
dismissed except as provided by law. 
.
.
 
en$. - The provisions of any law to the 
contrary notwithstanding, securities on loans andlor other accommodations granted by 
the Bank or its predecessors-in-interest shall not be subject to attachment, execution or 
any other court process, nor shall they be included in the property of insolvent persons 
or institutions, unless all debts and obfigation of the debtor to the Bank and its 
predecessors-in-interest have been previously paid, including accrued interest, 
penalties, collection expenses, and other charges. 
uct 
, - In case of sale of mortgaged properties 
under the provisions of existing laws or of this Code, suck sale shall be conducted 
under the direction of the sheriff of the province or any special sheriff of the Bank, or of 
a municipal judge or notary public of the city or municipality where the sale is to be 
made, who shall be entitled to collect the fees provided for in the rules of court with 
respect to sale of properties under execution. 
- 
.- 
^ X i  - 


. - Any mortgagor of the Bank whose real 
property has been extra judicially sold at public auction shail, within one {I) 
year 
counted from the date of registration of the certificate of sale, have the right to redeem 
the real property by paying to the Bank all of the latter's claims against him, as 
determined by the Bank. 
The Bank may take possession of the foreclosed property during the redemption 
period. When the Bank takes possession during such period, it shall be entitled to the 
fruits of the property with no obligation to account for them, the same being considered 
compensation for the interest that would otherwise accrue on the account. Neither shall 
the Bank be obliged to post a bond for the purpose of such possession. 
naf Interest- 
Whenever any member attending a meeting of the board cf directors has a direct 
personal interest in the discussion or resolution of any given matter, or any of his 
relatives within the second civil degree of consanguinity or second civil degree of affinity 
has such an interest, said member shall not participate in the discussion or resolution of 
the matter and must - retire from the meeting during the deliberation thereon. The 
minutes of ihe meeting, which shall note the subject matter, when resolved, the fact that 
a member had a personal interest in it, 2nd the withdrawal of the member concerned, 
may be made available to the public. 
_- 
For this purpose, the members of the board shall, at the beginning of their 
respective terms, disclose to the board any and all interests they may have in 
any corporation, partnership, or association and shall, thereafter, disclose to 
the board, any changes thereto. 
.
.
 
ith 
1. - No member of the 
board, officer, attorney, agent, or employee of the Bank shall in any manner, directly or 
indirectly participate in the detiberation upon or the determination of any question 
affecting his direct personal interest or the personal interests of his relatives within the 
second civil degree of consanguinity or second civil degree of affinity, or of any 
corporation, partnership, or association in which he has a direct interest. Any person 
violating the provision of this section shall be summarily removed from office and shall 
upon conviction be punished with a fine no less than one thousand peso (Phpl ,000.00) 


nor more than ten thousand pesos (Phpl 0,000.00) or with imprisonment of riot less than 
one (I) year nor more than five (5) years, or by both fine and imprisonment at the 
discretion of the court. 
o director or officer or employee of the Bank or any corporation, 
partnership, or company wherein any member of the board of directors, officer or 
employee, and/or their respective immediate family is a controlling shareholder, or 
wherein he is a director or officer shall, either directly or indirectly, for himself or as 
representative or agent of others, borrow any of the deposits of funds from the Bank, 
nor shall he become a guarantor, endorser, or surety for loans from the Bank to others, 
or in any manner be an obligor for money borrowed from the Bank or loaned by it: 
Provided, That this prohibition on loans to directors, officers and employees shall not 
include loans allowed in the form of fringe benefits granted in accord,ance with rules and 
regulations as may be prescribed by the monetary board of the Bangko Sentral. 
I 
~~~t~~~~ on 
t. - The foregoing 
provisions notwithstanding and in addition thereto, the board of directors is hereby 
authorized to issue rules and regulations for the purpose of determining and resolving 
conflict of interest questions, which rules shall, in particular, include the requirement on 
all officers and employees of the Bank to disclose any shareholdings they, or their 
relatives within the second civil degree of consanguinity or second civil degree of 
affinity, may have in any corporation, partnership, or company, in excess of two percent 
(2%) of the equity of said corporation, partnership, or company. 
ank. - The Bank shall be subject to supervision 
and examination by the appropriate department of the Bangko Sentral. 
~~~~~~~~ 
ank. - Except as 
required by law, or upon order of a court of competent jurisdiction, or the express order 
of the president of the Philippines or written permission of the client, no officer or 
employee of the Bank shall reveal to nor- allow to be examined, inquired, or looked into, 
by any third person, government official, bureau or office any information relative to 
details of individual accounts or specific banking transactions: Provided, That in respect 
to deposits of whatever nature, the provisions of existing law shall apply. 
.
.
 
This prohibition shall not apply to the exchange of confidential credit information 
among government financial institutions or among banks, in accordance with 


established banking practices or as may be allowed by law. 
E - No unauthorized 
fee, commission, gift or charge of any kind shall be exacted, demanded or paid for 
obtaining loans from the Bank, and any officer, employee, or agent of the 
guilty OF exacting, demanding or receiving any fee for services in obtaining a loan, shall 
be punished-by a fin&f not less than one thousand pesos (Phpl, 000.00) nor more than 
twenty thousand pesos (Php20,000.00), imprisonment for not less than one (I) 
year nor 
more than ten ( I O )  years, and perpetual disqualification from public office. 
~
~
v
~
~
~
~
~
- Any officer or employee of the Bank who 
violates, or permits any of the officers, employees or agents of said Bank or any other 
person to violate, any of the provisions of this Code not specifically punished in the 
preceding sections, and any person violating any provision of this Code or aiding and 
abetting the violation thereof, shall be punished with a fine not less than one thousand 
pesos (Php 1,000.00) nor more than ten thousand pesos (Php10,000.00) and with 
imprisonment not less than one (I 
1 year nor more than five (5) years. 
.
.
 
. - Any member of the 
board of directors or officer or employee of the bank who willfully violates any of the 
provisions of this Code shall, in addition to the criminal and administrative liability 
resulting from such act, be held liable for any loss or injury suffared by the Bank as a 
result of such violation. 
, - If the violation of the provisions of this Code is 
committed by a corporation or partnership, the directors, officers or partners thereof who 
participated in the violation shall be criminally liable for such violation. 
y. - The Bank shall not be subject to the laws and 
regulations governing banks and other financial institutions of whatever type except with 
respect to the receipt of savings and time deposits in accordance with Section 498 of 
this Code, 'k-which case the legal reserves and other requirements prescribed by the 
Bangko Sentral for such deposits apply. The Bank shall be operated as an autonomous 
body and shall be under the supervision of the Bangko Sentral. 
- 


EC. 522. Tax ~
x
~
~
~
~
~
- The operations, as well as holdings, equipment, 
property, income and earnings of the Bank from whatever sources shall be exempt from 
taxation. 
3. 
, - Upon effectivity of this act, the board of 
directors of the Bank shall be constituted and its chairman appointed. The chairman is 
hereby authorized, subject to the approval of the board of directors, to issue such 
orders, rules and regulations, and undertake such actions as may be necessary to 
organize the Bank and make it operational within one (1 1 year from the date that this Act 
takes effect. 
'BITE 
M. 
- The itemized monthly collections 
and 
disbursements of the local government 
shall be posted within ten ( I O )  
days following the end of every month and for at least two (2) consecutive weeks 
.
.
 at 
prominent places in the main office building of the local government concerned, its 
plaza and main street. Said itemization shall be published in a newspaper of general 
circulation, where available, in the territorial jurisdiction of such unit in case the local 
treasurer or whoever is in-charged with the duty of posting and publishing the same, 
shall be punished by a fine not exceeding five hundred pesos (Php500.00) or by 
imprisonment not exceeding one (J) month, or both such fine and imprisonment, at the 
discretion of the court. 
concerned 
. - Any officer charged with the duty of assessing real property who 
willfully fails to assess, or who intentionally omits from the assessment or tax roll any 
real property which he knows to be taxable, or who willfully or negligently under 
assesses any real property, or who intentionally violates or fails to perform any duty 
imposed upon him by law relating to the assessment of taxable real property shall, upon 
conviction, be punished by a fine of not less than one thousand pesos (Php1,OOO.OOj nor 
more than five thousand pesos (Php5,000.00), or by imprisonment of not less than one 


(J) month nor more than six (6) months, or both such fine and imprisonment, at the 
discretion of the court. 
The same penalty shall be imposed upon any officer charged with the duty of 
collecting the tax due on real property who willfully or negtigentiy fails to collect the tax 
and institute the necessary proceedings for the collection of the same. 
Any other officer required by this Law to perform acts relating to the 
administration of the real property tax or to assist the assessor or treasurer in such 
administration, who willfully fails to discharge such duties shalt, upon conviction be 
punished by a fine of not less than five hundred pesos (Php500.00) nor more than five 
thousand pesos (Php5, 000.00) or imprisonment of not less than one (I) month nor more 
than six (6) months, or both such fine and imprisonment, at the discretion of the court. 
~~~~~~~~~~ 
~~~~~. - Any government official who intentionally and deliberately 
delays the assessment of real property or the filing of any appeal against its 
assessment shall, upon conviction, be punished by a fine of not less than five hundred 
pesos (Php500.00) nor more than five thousand pesos (Php5,000.00), or by 
imprisonment of not less than one ( I )  month nor more than six (6) months, or both such 
fine and imprisonment, at the discretion of the court. 
- The local treasurer concerned who fails to dispose of delinquent real property at 
public auction in compliance with the pertinent provisions of this Code, and any other 
local government official whose acts hinder the prompt disposition of delinquent real 
property at public auction shall, upon conviction, be subject to a fine of not less than one 
thousand pesos (Php '1,000.00) nor more than five thousand pesos (Php5000.00), or 
imprisonment of not less than one (I} 
month nor more than six (6) months, or both such 
fine and imprisonment, at the discretion of the court. 
fits. - Any official or employee of 
the national government or local government who is separated from the service as a 
result of reorganization effected under this Code shall, if entitled under the laws then in 


force, receive the retirement and other benefits accruing hereunder: Provided, however, 
that such benefits shall be given funding priority by the Department of Budget and 
Management in the case of national officials and employees, and the local government 
concerned in the case of local officials and employees. 
Where the employee concerned is not eligible for retirement, he shall be entitled 
to a gratuity from the national government or the local government concerned, as the 
case may be, in an amount not lower than one (I) month salary for every year of service 
over and above the monetary value of the leave credits said employee is entitled to 
receive under the existing laws. 
ther 
Each local government shall conduct a periodic inventory of infrastructure and other 
community facilities and undertake the maintenance, repair, improvement, or 
reconstruction of these facilities through a closer cooperation among the various 
agencies OF the national government operating within the province, city, or municipality 
concerned. 
(c) No infrastructure or community project within the territorial jurisdiction of any 
local government shall be undertaken without informing the local chief 
executive and the sanggunian concerned. 
ies. - All records, equipment, buildings, 
facilities, and other properties of any office or body of a local government abolished or 
reorganized under this Code shall be transferred to the office or body to which its 
powers, functions, and responsibilities are substantially devolved. 
- 
- ./ 
- 
*- - 
e. - To carry out 
the purpose or purposes of this act, the President of the Philippines shall issue such 
rules and regulations as may be necessary. In doing so, the President may constitute 
and avail of the services of a committee, which will assist in the formulation of the rules 
and regulations to be known as the National Decentralization Committee (MDC). It shall 
be composed of the secretaries or heads of the Department of the interior and Local 
Government, Department of Budget and Management, Department of Finance, and the 
respective presidents of the Leagues of Provinces, Cities and Municipalities as well as 
Barangays. The committee may seek the assistance of government agencies, academe 
and other institutions in the performance of their task which can promote effective local 
governance. 


ter 
ower. - The national 
government shall, im._mediately, 
- .- 
effect the deconcentration of requisite authority and 
power to the appropriate Regional Governments. 
.-< - 
. - (a) Unremitted national 
collections and statutory contributions. - All debts owed by local governments to the 
national government in unremitted contributions to the Integrated National Police Fund, 
the Special Education Fund, and other statutory contributions as well as in unremitted 
national government shares of taxes, charges, and fees collected by the local 
governments, are hereby written off in full. 
(b) Program loans. - (I 
} Program loans secured by local 
governments 
which were relent to private persons, natural or juridical, shall likewise be 
written off from the books of the local governments concerned: Provided, 
however, that the national government agency tasked with the 
implementation of these programs shail continue to collect from the 
debtors belonging to the private sector concerned. 
(2) Program loans granted to local governments by national government 
agencies and which were utilized by the local units for community 
development, livelihood, and other smakcale projects are hereby 
written off in full. 
(d) Settlement of debts due to government financing institutions (GFls) 
government-owned and controlled corporations (GOCCs), and private utilities. 
The national government shall assume all debts incurred or contracted by 
local governments from GFls, GOCCs, and private utilities that are 
outstanding as of December 31, 1988, in accordance with the following 
ssh-emes: T- 
(1) Debts due GFls. - The national government may buy outstanding 
obligations incurred by local governments from government financing 
institutions at a discounted rate. 
(2) Debts due GOCCs. - The national government may settle such obligations 
.
.
 


at discounted rate through offsetting, only to the extent of the obligations 
of local governments against the outstanding advances made by the 
National Treasury in behalf of the government-owned and controlled 
corporations concerned 
(3) Debts Due Private Utilities. - The national government may settle these 
obligations at a discounted rate by offsetting against the outstanding 
obligations of such private utilities to government-owned corporations. 
GOCCs may in turn offset these obligations against the outstanding 
advances made by the National Treasury in their behalf. 
in the case of obligations owed by local governments to private utilities, which 
are not indebted to any GOCC or national government agency, the national government 
may instead buy the obligations of the local governments from the private utilities at a 
discounted xate, upon-concurrence by the private utilities concerned. 
(d) Limitations. - Obligations to the Home Development and Mutual Fund (Pag- 
ibig), Medicare, and those pertaining to premium contributions and 
amortization payments of salary and policy loans to the Government Service 
Insurance System are excluded from the coverage of this Section. 
(e) Recovery schemes for the national government. - Local governments shall 
pay back the national government whatever amounts were advanced or offset 
by the national government to settle their obligations to GFls, GOCCS, and 
private utilities. The national government shall not charge interest or penalties 
on the outstanding balance owed by the local governments, 
These outstanding obligations shall be restructured and an amortization 
schedule prepared, based on the capability of the local government to pay, 
taking into consideration the amount owed to the national government. 
The national government is hereby authorized to deduct from the quarterly share 
of each local government in the internal revenue collections an amount to be 
determined on the basis of the amortization schedule of the local unit concerned: 
Provided, That such amount shall not exceed five percent (5%) of the monthly internal 
revenue allotment of the local government concerned. 
As incentive to debtor-local governments to increase the efficiency of their fiscal 
administration, the national government shall write off the debt of the local government 


concerned at the rate of five percent (5%) for everyone percent: (1 %) increase in 
revenues generated by such local government over that of the preceding year. For this 
purpose, the annual increase in local revenue collection shall be computed starting 
.
.
 from 
. 
the year 1988. 
(f) Appropriations. - Such amount as may be necessary to implement the 
provisions of this Section shall be included in the annual General 
Appropriations Act. 
. - Except as otherwise herein provided, all laws, 
acts, city charters, decrees, executive orders, proclamations and administrative rules 
and regulations or part or parts thereof which are in conflict or inconsistent with this Act 
(Code) are hereby repealed or modified accordingly. 
Until otherwise provided by law, nothing in this Act (Code) shall be understood to 
amend or repeal the provisions of Republic Act No. 6734, as amended, otherwise 
known as the Organic 
_- Act for Autonomous Region in Muslin Mindanao. 
.- 
- _ < .  - 
lause. - If, for any reason or reasons, any part or 
provision of this Act shall be held invalid or unconstitutional, other parts or provisions 
hereof which are not affected shall continue to be in full force and effect. 
. - This Act (Code) shall take effect one month after 
the approval and its publication in the Official Gazette. It shall likewise be published in 
two newspapers of general circulation. 
Approved,