Republic of the Philippines
HOUSE OF REPRESENTATIVES
17" Congress
First Regular Session
Quezon City

4329

HOUSE BILL NO.

INTRODUCED BY REPRESENTATIVE ANSARUDDIN A.M. A. ADIONG

EXPLANATORY NOTE

This bill seeks to create the Lake Lanao Development Authority and Provide
Funds Therefor.

Lake Lanao is known to be one of the seventeen (17) ancient lakes in the whole
world, and considered to be one of the earth's natural wonders in Asia. It is the second
largest lake in the Philippines, Likewise, Lake Lanao is the most useful lake in the
Philippines. It is highly suitable for fishery development. It is the major source of
hydroelectric power of the island of Mindanao, It is also used to be the habitat of
endemic fish species. It is the pride of the Maranao, the “people of the lake”. It
symbolizes our identity, culture, economy and spirituality.

However, through the years, no practicable measures and unified efforts of
agencies concemed are being implemented to safeguard the ecological balance and
environmental equilibrium of the Lake Lanao area, That is why, there have been
various and growing clamors to save the endangered lake. Endemic fish species
already disappeared. The water quality has deteriorated due to illegal logging, pollution
and other environmental degradation activities in the area. The signs of neglect are
now noticeable.

The lake has been the subject of intent studies. One study shows that there is a
major fault-line that splits the lake's bedrock in a roughly northeast-southwest direction
following the long axis of the lake, This fault-line is a southward extension of the fault-
line which originates form Camiguin Island near Hibok-Hibok Volcano and extends to
about 28 kilometers towards the center of the Lake's bedrock. The late Dr. Mamitua
Saber, formerly Research Professor of the Mindanao State University in Marawi City
observed that fluctuations in the total weight of the water supported by the lake basin
are undesirable. The fluctuations can cause vertical oscillations of unknown magnitude
and may complicate the fractures in the lake bottom, especially along the immediate
vicinity of the major fault-line. This may result in the production of bottom fissures of
varying magnitudes that may lead somewhere else, not necessarily in the Lake Lanao
area, They could produce leakage and decrease the volume of water in the lake and
consequently lower its water level below the minimum requirements. If these happen,
the power plants will be rendered useless.


Hence, the creation of the Lanao Lake Development Authority will undoubtedly
save and rehabilitate the lake in distress. The preservation and advancement of the
ecological system, environmental conditions, and rich marine resources of the Lanao
Lake area will surely be addressed

The urgency of the passage of this bill is earnestly sought for.

REP. ANSAI DIN A.M. A. ADIONG
4*' District, Lanao del Sur


Republic of the Philippines
HOUSE OF REPRESENTATIVES
17" Congress
First Regular Session
Quezon City

HOUSE BILL No, 4829

INTRODUCED BY REPRESENTATIVE ANSARUDDIN A.M. A. ADIONG

AN ACT
CREATING THE LAKE LANAO DEVELOPMENT AUTHORITY AND.
PROVIDING FUNDS THEREFOR

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

Section 1. Title - This Act shall be known as the “Lanao Lake Development Authority
Act of 2016”

Section 2. Declaration of Policy ~ It is hereby declared to be the national policy to
promote, and accelerate the development and balanced growth of the Lake Lanao area
consistent with the national and regional plans and policies for social and economic
development and to carry out a comprehensive development plan of the Lake Lanao
area, within the context of adequate provisions for environmental management and
control, preservation of the quality of human life, environment and ecological systems

It is further declared to be the policy of the State that the development plan of
Lake Lanao shall likewise promote higher productivity, increase income, alleviate
poverty, create more employment opportunities, encourage sustainable development
and people empowerment.

Section 3. Creation of Lake Lanao Development Authority — For the purpose of carrying
out and effecting the declared policy, as provided for in Section one hereof, there is
hereby created a body corporate to be known as the Lake Lanao Development
Authority, hereinafter referred to as the Authority, which shall be organized within one
hundred twenty (120) days after the approval of this Act. The Authority shall execute
the powers and functions herein vested and conferred upon it in such a manner as will
aid to the fullest possible extent in carrying out the purposes set forth below.

Section 4. Supervision - The Authority shall be under the supervision of the Office of
the President.

Section 5. Territorial Jurisdiction - Except as herein otherwise provided, the Authority
shall cover the Lake Lanao Area.


Section 6. Principal Office - The principal office of the Authority shall be located in
Marawi City or any of its adjacent municipalities. However, whenever it deems
necessary, it may establish such branches, subsidiaries, offices or agencies, in any
municipality, or barangay in Lanao del Sur or any local government unit within the
territorial jurisdiction of Muslim Mindanao.

Section 7. Term — The Authority shall have a term of fifty (50) years from the effectivity
of this Act renewable for the same period unless otherwise provided by law.

Section 8. Special Powers and Functions - The Authority shall’exercise and perform the
following powers and functions:

1) To gather and collate planning data, research references, statistics, as well as
their relevant and essential elements, and on the basis of such materials, draft a
Wholistic, rational, systematic, comprehensive plan consisting of the short, medium and
long-term programs for the development of the Lake Lanao area, after carefully
evaluating the present social and economic conditions, available resources and
opportunity costs, problems and difficulties, as well as the existing national and regional
policies and plans for the area and providing for such safeguards as are necessary for
ecological balance and environmental protection;

2) To monitor and coordinate the implementation of such plan according to the
Authority's multi-level and multi-sectoral programs, particularly, such part of the Plan as
will benefit the preservation and conservation of the ecological system, as well as the
protection and advancement of the environmental condition in the area; to preserve life,
protect public health and safety; and to maximize the utilization of the area's spatial
land, manpower resources and indigenous raw materials for agricultural, industrial and
commercial uses; water resources for fisheries and fishing; unique arts, cultural designs
and scenic landscapes for tourism; and to induce and engender higher production
employment, income, savings and investments in the area for its economic growth and
social progress;

3) To plan and coordinate the establishment of such economic and social structures
as may be necessary for entrepreneurial mobilization as will provide local traders,
craftsmen, farmers, fishermen, and workers access to credit facilities, equipment and
machineries, raw materials and agri-inputs, transportation and communications, storage
and drier, skills training and tax exemptions to fast-track the development of the area by
means of higher productivity in farming, manufacturing, trading and fishing, stimulate
the efficient use of the factors of production;

4) To identify and recommend viable areas which will be given priority industrial and
commercial development, as well as their possible sources of financing, whether
domestic or foreign; to encourage their early utilization and development for economic
growth and expansion through government action or by private initiative; and to promote
the use or appreciation of such modern technology, facilities and equipment, methods
and processes as are available for their maximum and economical use;

5) To adopt workable and long-range policies for the intensification of local products
for export; to sustain agricultural, industrial and commercial development in the area; to
pave the way for the expansion of its domestic market structure; and to support the
internal growth of income and the accumulation of savings for local investment;

6) To encourage people's participation in the organization and development of
cooperatives, nongovernmental organizations, neighborhood organizations and other
groups for the development of livelihood projects and for the economic upliftment and
amelioration of the members thereof through entrepreneurship development and the


provision of such technical and financial aids, as may be necessary, to make them self-
supporting, self-sustaining or self-reliant economic entities, especially such sectoral
livelihood projects or income generating activities which are capital-starved but are
otherwise profitable, labor-intensive and are utilizing indigenous local raw materials and
traditional skills, arts and designs to promote the expansion of micro-enterprises in the
area;

7) To coordinate and monitor the building, operation and transfer of projects
involving the construction of abattoirs, dams, réservoirs, roads, wharfs, telephones,
transmission projects as are necessary including pipes along rivers or its tributaries
subject to the approval of the President of the Philippines and upon the
recommendation of the department head concerned;

8) To propose the zonification and reclassification of land to the local government
units concerned;

9) To reclaim lands or cause the reclamation of portions of the lake including
foreshore and submerged areas by dredging, filling or other means, or acquire
reclaimed lands in joint ventures with private entities under a sharing agreement.

10) To rationalize the uses of, or to hold, administer, utilize, encumber or otherwise
deal with public lands and/or to acquire, by purchase urban idle lands, whether public or
private for the underprivileged, displaced or homeless citizens; to make available to
them decent housing at affordable costs with appropriate basic services and access to
employment opportunities and/or “growth center” for livelihood projects or income-
generating projects;

11) To formulate and recommend plans, programs and projects and monitor the
issuance of licenses, franchises or concession relating to or for thé utilization and
development of the natural resources of the area or any of the places within its territorial
Jurisdiction subject to such limitations as are provided for by law or the Constitution and
to promulgate such rules and regulations as are necessary for the preservation,
conservation and advancement of the natural resources of the area, prescribing therein
the form and manner through which their uses or utilization may be authorized
particularly its timber, mineral land, water and fisheries resources subject to the
approval of the President, and upon the recommendation of the Secretary of the
Department of Environment and Natural Resources and the Secretary of the
Department of Agrarian Reform;

12) To coordinate programs, projects or activities pertaining to the construction of
infrastructure program such as river flood control, sewerage work, water supply,
irrigation and such other related public works as may be required under its development
plan or programs including the readjustment, relocation or restoration of population
within the area as may be necessary; and

13) To extend the Authority's expertise on planning, management and such other
facilities as may necessary to prospective and present investors.

Section 9. Corporate Powers - As a corporate body, the Authority shall exercise its
specific powers and functions as follows

1) To succeed on its corporate name;

2) To sue and be sued in such corporate name;
3) To adopt, alter and use a corporate seal

4) To adopt, amend, and repeal its by-laws:


5) To enter into contracts of any kind and description, to enable it to carry out its
purposes and functions under this Act;

6) To acquire, buy, purchase, hold or lease, such personal and real property as it
deems necessary or convenient in the transaction of its business and/or in
relation with carrying out its purposes under this Act; and to lease, mortgage,
sell, alienate, or otherwise encumber, utilize, exploit or dispose and such
personal and real property held by it, subject to prior or existing individual or
communal right of private parties or of the government or any agency or
enterprise thereof. ;

7) To exercise the right of eminent domain whenever’ the Authority deems it
necessary for the attainment of the objectives of the Authority under this Act;
To borrow funds from any local or foreign financial institutions independent of the
bonds it may issue or may continue to issue, to carry out the purposes of this
Authority under this Act;
To purchase, hold, alienate, mortgage, pledge or otherwise dispose of the shares
of the capital stock of, or any bond, securities, or other evidence of indebtedness
created by any other corporation, partnership, or government agencies or
instrumentalities-, and with, the owner of said stock, to exercise all the rights of
ownership, including the right to vote thereon; Provided, That the authority shall
not invest its funds in any highly risky debt instruments issued without recourse
to commercial banks or investment houses as well as in any highly speculative
stocks

10)For carrying on its business, or for the purpose of attaining or furthering any of its
objectives, to perform any and all acts which a corporation, partnership, or
natural person is authorized to perform under the laws now existing or which may
be enacted hereafter.

11)To coordinate and integrate multi-sectoral participation and activities relating to
the utilization of Lake Lanao within the context of national plans and policies for
social and economic development

12)To issue such rules and regulations as may be necessary to effectively carry out
the powers and purposes herein; provided including the plans, programs and
projects of the Authority, subject to the approval of the board of directors

13)To undertake survey, inventory, appraisal of the lake area and develop
comprehensive plan for its protection, conservation and development;

14)To address the concerns on land use planning and management and flooding
around the lake;

15)To conduct and/or promote special studies and researches with other
government or private agencies on all related aspects of water resources
development, such as but not limited to weather modification and environmental
quality;

18)To exercise such powers and perform such other acts as may be necessary to
effectively carry out the provisions of this Act

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Section 10. Capitol Stock ~ The Authority shall have an authorized capital stock of Two
Hundred Million Pesos (P200,000,000.00) to be divided into two million shares
(2,000,000) shares of stocks with a par value of One Hundred Pesos (P100.00) per
share, Provided, That majority of the authorized capital stock shall be subscribed by the
national government and any of its instrumentalities and the balance to be subscribed
and paid by the private sector: Provided further, That in the case of the national
government, the initial amount necessary to subscribe and pay for the initial shares of
stock shall be included in the annual General Appropriations Act.

Section 11. Operating Expenses ~ The amount of Fifty Million Pesos (PS0,000,000.00)
for the initial operating expenses of the Authority shall be included in the General
Appropriations Act. Thereafter, the Authority shall provide for its operations and
maintenance.


Section 12. Power to Incur Debts and to Issue Bonds ~ Whenever the Board of
Directors may deem it necessary for the Authority to incur indebtedness or to issue
bonds to carry out the provisions of this Act, it shall by resolution so declare and state
be confirmed by the affirmative vote of the stockholders representing a majority of the
subscribed capital stock outstanding and entitled to vote.

The Authority shall submit to the NEDA Board and the Monetary Board of Central
Bank, for approval, its proposal to incur indebtedness or to issue bonds. This shall be
considered authorized upon approval of the President of the Philippines

Section 13. Sinking Fund Account ~ A sinking fund shall be established in such manner
that the total annual contribution thereto accrued at such rate of interest as may be
determined by the Board of Directors as confirmed by the stockholders representing a
majority of the subscribed capital stock outstanding and entitled to vote, shall be
sufficient to redeem at maturity the bonds issued under this Act.

Such fund shall be under the custody of the treasurer of the Authority who shall
invest the same in such manner as the Board of Directors may direct, charge expenses
of investment to said sinking fund, and credit the same with the interest on investment
and other income according thereto.

Section 14. Authority to Contract Foreign Loan ~ The Authority is hereby authorized to
contract loans, credits or indebtedness in any convertible foreign currency or capital
goods from time to time from foreign governments or any international financial
institutions or fund sources.

With the prior concurrence of the Monetary Board and in accordance with
Section 20 of Article VII of the Constitution, the President of the Philippines is hereby
further authorized to guarantee, in the name andior behalf of the Republic of the
Philippines, the payment of any loans herein authorized, as well as the performance of
all or any of the obligations undertaken by the Authority, pursuant to Iban agreements
entered into with foreign governments or any international financial institutions.

In the negotiation and contracting of any loan, credit or indebtedness under this
section, the provision of Section 4 of Republic Act No. 4860, as provided in Section 5 of
Republic Act No, 6142, as amended, shalll apply.

The foreign loans, credits or indebtedness contracted under this subsection and
the payment of the principal interest and other charges thereon, as well as the
importation of machineries, equipment, materials and supplies by the Authority, paid
from the proceeds of any loan, credit or indebtedness, incurred under this Act shall be
exempt from all taxes, fees, imposts, other charges and restrictions imposed by the
Republic of the Philippines or any of the agencies and political subdivisions.

Section 15. Tax exemption — Within five (5) years from the effectivity of this Act, the
Authority shall be exempt from the payment of income taxes, franchise taxes, realty
taxes, and all kinds of taxes and licenses to the national government, its provinces,
cities and municipalities and other government agencies and instrumentalities:
Provided, That its subsidiary corporation shall be subject to all said taxes five (5) years
after their establishment under graduated scale, Such exemption shall include any tax
or fee imposed by the government on the sale, purchase or transfer of foreign exchange
and all notes, bonds and debentures, and other obligations issued by the Authority, both
as to its principal and interest

Section 16. Structure, Staffing and Pay Scale - The Board shall determine the
organizational structure, staffing pattern and pay scale of the Authority, and the officers


and employees thereof conformably to that of existing government-owned or controlled
corporations and subject to existing rules and regulations of the Civil Service
Commission and the Department of Budget and Management,

Section 17. Subsidiary Corporation - The Authority may, for the attainment of its
purpose and objectives, establish and maintain one or more subsidiary corporations
subject to the approval of the Securities and Exchange Commission. The Chief
Executive Officer of the Authority or his representatives shall be ex officio member of
the Board of Directors of said subsidiary corporation

Section 18. Merit System - All officials and employees of the Authority and its
subsidiary corporation shall be selected and appointed on the basis of merit and fitness,
in accordance with a comprehensive and progressive merit system, which shall be
established by the Authority immediately upon its organization. The recruitment,
transfer, promotion and dismissal of its personal including contractual workers shall be
governed by such merit system in accordance with existing laws, rule and regulations.

Section 19. Board of Directors - The corporate powers and functions of the Authority

shall be vested in and exercised by a Board of Directors, hereinafter referred to as the

Board, which shall be composed of eleven (11) members as follows:
1) Secretary, Department of Energy, as ex officio chairman;

Regional Governor, Autonomous Region in Muslim Mindanao as ex-officio, Vice-

Chairman;

President, National Power Corporation, as ex-officio member;

Provincial Governor, Lanao del Sur, as ex-officio member,

Representative, 1 District of Lanao del Sur;

Representative, 2™ District of Lanao del Sur;

City Mayor, Marawi City, as ex-officio member;

Representative, Department of Environmental and Natural Resources;

Representative, Department of Agriculture;

10)Representative, Department of Trade and Industry; and

11)One (1) representative from the private sector, either from the cooperative
federation or union, nongovernmental organization or any duly registered
association to be appointed by the President of the Philippines who shall serve
for a term of 3 years: Provided, That in the event of vacancy, the successor
appointed to fill the same shall serve only the unexpired portion of the term of the
member he succeeds.

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Section 20. Quorum ~ The presence of a majority of the members of the board shall
constitute a quorum for the transactions of the business the board.

Section 21. Meetings — The board shall meet preferably at its principal office at least
once a month as frequently as necessary to discharge Its duties and responsibilities
The Board shall be convoked by the Chairman or upon the written request of at least
three (8) of its member. Except as otherwise provided for in this Act, the votes of a
majority of the members constituting a quorum shall be sufficient for the adoption of any
rule, resolution, decision or any act of the Board

The members of the Board shall receive per diem for every meeting actually attended
and shall be reimbursed by the Authority for actual expenses (including travelling and
subsistence expenses) incurred by them in the performance of their duties in
accordance with existing law.

Section 22. Powers and Functions - The Board shall have the following powers and
functions:


To formulate policies, develop programs and establish projects, and promulgate
rules and regulations to govern the conduct of the affairs of the authority;

2) To adopt and approve the annual or supplemental budget of the authority to
cover its financial operation;

3) To appoint and fix the compensation and allowances of all the officers and
employees of the Authority including the Deputy Administrator and Assistant
Deputy Administrator in accordance with existing laws;

4) Upon the majority vote of all members on the Board, to suspend, remove or
otherwise discipline its officers and employees for just cause;

5) To submit an annual report to the President and render such special reports as

may be required or deemed necessary; and

6) To perform such other functions as may be necessary to carry out the provisions
of this Act

Section 23. Administrator - The Board shall have an administrator to be appointed by
the President of the Philippines who shall be the Chief executive officer of the Authority
The administrator shall serve for a term of four (4) years subject to renewal upon
recommendation of the Board and at the pleasure of the President

The administrator shall be assisted by such Deputy Administrator and Assistant
Deputy Administrator as the Board may authorize and appoint. Their tenure,
qualification and compensation shall be determined and fixed by the board in
accordance with existing laws.

Preferably, the administrator shall possess, at least, a master's degree in
economics or shall have attended an MBA course at a reputable institution of higher
learning for, at least, two (2) consecutive years. He must also have held for, at least
five (5) years an executive or managerial position, and he must be a native of the area
and is an actual resident thereof.

Section 24. Duties and Functions of the Administrator - The administrator shall perform
the following duties and functions:

1

Submit, for the consideration of the Board, the policies and measures which he
believes to be necessary to carry out the provisions of this Act;

Executive and administer the policies and measures approved by the board;
Direct and supervise the operation and internal administration of the Authority
He may, for efficiency and effectiveness, delegate certain administrative
responsibilities to other officers of the Authority subject to the rules and
regulations of the Board;

Represent the Authority in all dealings with other offices, agencies and
instrumentalities of the government and with all other persons, entities or
enterprises, whether public or private, domestic or foreign;

Sign contracts entered into or concluded by the Board, and such other
correspondence and documents of the Authority;

Represent the Authority, either personally or through counsel, in any legal action
or proceedings; and

7) Exercise such other duties and functions as may be granted to him by the Board

2)
3

4

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Section 25. Department - There shall be created by the authority the following service
departments: Administration Operation, Finance and Management, Planning and
Programming, Legal auditing, and such other department, division, section or unit as the
Board may deem necessary to carry out its powers and functions. The tenure
qualification and compensation of the personnel of these departments or any of its unit
shall be determined and fixed by the Board in accordance with existing laws.

Section 26. Auditing ~ The auditing department shall be headed by duly appointed paid
according to law. All personnel of the auditing départment shall be appointed and their
number and salaries fixed by the Commission on Audit in accordance with existing laws.

Section 27. Miscellaneous Provision — Within ninety (90) days upon the effectivity of this
Act, the Authority shall be organized to carry out its purposes and objectives: Provided,
That the Authority shall, furthermore, within one (1) year upon organization, formulate a
comprehensive plan for the rapid and balanced development of the Lake Lanao Area
Provided, finally, That the aforesaid plan shall be submitted to the President after proper
evaluation and upon the recommendation of the National Economic and Development
authority.

Section 28. Applicable of the Corporation Law ~ The provisions of the corporation law,
as amended, insofar as they are not inconsistent with this Act shall be applicable to the
operations of the Authority.

Section 29. Repealing Clause ~ All laws, decrees, orders, rules and regulations or parts
thereof inconsistent with the provisions of this Act are hereby repealed, amended or
modified accordingly

Section 30. Effectivity Clause - This Act shall take effect upon its approved.

Approved