THIRTEENTH CONGRESS OF THE REPUBLI 
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First Regular Session 
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OF THE PHILIPPINE 
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S E N A T  
S. No. 
Introduced by Senator S. R. Osmefia Ill 
EXPLANATORY NOTE 
Water shortage is becoming a perennial problem in our country with the 
growing scarcity of potable water in urban centers as well as rural areas. 
As our population increases, the difficulties of providing an adequate 
supply of clean water will become more acute. The El Nit70 Phenomenon, 
pollution of water sources and illegal connections further aggravate the problem. 
This bill which seeks to create the Water Resources Authority of the 
Philippines (WRAP) in order to address the problems of the water sector. It 
rationalizes the activities of numerous national and local agencies that are 
concerned with water. This authority will adapt an integrated approach to water 
resources development for a more efficient and sustainable policy-making and 
imp leme n tat io n . 
As proposed in this measure, I) 
the WRAP shall absorb the functions of 
the National Water Resources Board (NWRB) and assume its policy making 
duties. 2) The Local Water Utilities Administration (LWUA) shall handle the 
licensing of local water districts subject to regulation by the WRAP. 3) The Water 
Resources Adjudication Board shall act as a quasi judicial body to settle disputes 
between WRAP and anybody it regulates such as the Metropolitan Water Works 
and Sewerage Systems (MWSS). 
The Philippines needs to adopt a long- term policy vis-a-vis the 
management of water resource. The creation of the Water Resources Authority 
of the Philippines is a long-term solution to a problem that requires our 
immediate attention. 
In view of the above foregoing factors, passage of this bill is earnestly 
requested. 
SERGIO OSMENA Ill 
Senator 


THIRTEENTH CONGRESS OF THE REPUBLI 
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OF THE PHILIPPINES 
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First Regular Session 
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S E N A T  
S. No. 
Introduced by Senator S. R. OsmeAa 111 
AN ACT 
TO ADDRESS THE NATIONAL WATER CRISIS PROVIDING FOR A 
COMPREHENSIVE WATER RESOURCES MANAGEMENT, AND FOR OTHER 
PURPOSES 
Be it enacted by the Senate and House of Representatives of the 
Philippines in Congress Assembled: 
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SECTION I .  Short Title. - This Act shall be known as “Water Resources 
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Management Act of 2004.” 
SECTION 2. Declaration of Policy. - The State shall adopt urgent and 
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effective measures to address the national water crisis as well as measures for 
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the long-term sustainable management of scarce water resources. To achieve 
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this purpose, the utilization and development of water resources must be 
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rationalized and optimized through an integrated water management system. All 
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agencies involved in water resources management shall be streamlined, 
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rationalized and strengthened. 
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SECTION 3. Basic Principles. -- Sustainable management of water 
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resources shall take into consideration the following principles: 
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a) 
Water is a limited resource and is indispensable for life and to all 
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socio-economic sectors. 
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b) 
Water has an economic value in all its competing uses and shall be 
treated as a social and economic product. 


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c) 
Water resources management shall be decentralized, participatory 
and community-based and conducted at the lowest appropriate level. 
d) 
Women play a central role in water resources management and 
shall be represented in decision-making processes. 
e) 
Private sector and civil society participation shall be encouraged in 
all levels of water resources management, utilization and development. 
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Licensing shall be the mechanism to ensure that public interest is 
protected in the provision of drinking water, sanitation, irrigation or other water 
services by monopoly suppliers. 
SECTION 4. The Water Resources Authority of the Philippines. - To 
carry out the above-declared policy, there is hereby created the Water 
Resources Authority of the Philippines, hereinafter referred to as the Authority. 
The Authority shall be an attached agency to the Office of the President. The 
Authority shall, in addition to the powers and functions herein provided, exercise 
the powers and functions of the National Water Resources Board provided under 
Presidential Decree No. 424 and Presidential Decree No. 1067. 
SECTION 5. Powers and Functions - The Authority shall have the 
following powers and functions: 
a) 
Formulate, within one (1) year from the effectivity of this Act, a 
national framework for integrated and sustainable water resources development, 
management and planning taking into consideration the following: 
1) 
provisions of supply of water of appropriate quantity and quality to 
all users in a manner which reflects national, regional and 
community priorities; 
efficient use of water through demand-side management and other 
programs; 
2) 
3) 
expansion and improvement of water and sewerage systems 
especially in low-income areas by providing an environment 
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conducive to the adequate financing of public and private water 
services; 
4) 
provision of an environment conducive to 
private 
sector 
participation in the water sector through economic incentives, 
efficient and effective regulatory mechanisms, and promotion of 
competition in the supply of water and sewerage services; and 
efficient delivery of water and sewerage services. 
Formulate, within one (1) year from the effectivity of this Act, in 
coordination with concerned agencies, a framework for a water data and 
information system, promulgate basic criteria, methods and standards for data 
collection, and rationalize existing data collection activities undertaken by various 
public and private entities; 
5) 
b) 
c) 
Formulate, within one (1) year from the effectivity of this Act, a 
national water resources development and management plan, which shall be 
intergovernmental, 
multi-sectoral, 
decentralized, 
community-based 
and 
participatory. The plan shall include, among others: 
1) 
the integration of all plans of the water sector in accordance with 
the principle of sustainable and integrated management of the 
water re sou rces ; 
formulation and adoption of measures to ensure the upgrading of 
the classification of inland waters based on their potential uses; 
and 
adoption of other measures in pursuant of the integrated water 
resources management and development. 
Delineate catchment areas, within one (1) year from the effectivity 
of this Act, and, whenever appropriate, establish sub-regional offices at the 
catchment level for the management of the local water resources within the 
national framework formulated pursuant to this Act; 
2) 
3) 
d) 
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e) 
Issue, upon consultation with the public and private entities 
affected, water permits for abstractions, diversions or appropriations of inland 
water; 
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Impose fees on raw water from all kinds of abstractions, 
diversions, or appropriations of inland water, in accordance with the following 
principles and factors; 
1) 
2) 
charge per volume used; 
3) 
4) 
affordability; and 
5) 
g) 
Establish rules and procedure for the trade, lease, sale, and 
environmental and social costs of water utilization; 
opportunity cost to other users; 
water conservation and sustainable use. 
transfer of water rights; 
h) 
Issue licenses to monopoly suppliers of water and/or sewerage 
services and irrigation services 
i) 
Monitor private sector participation plans of the water sector and 
act as adviser to the national government agencies on private sector 
participation in the water sector. 
j) 
Promulgate rules and regulations on the licensing of well-drillers for 
the purpose of monitoring ground water abstraction 
k) 
Exercise all powers of the National Water Resources Board under 
Presidential Decree No. 1067 and Presidential Decree No. 424 and other laws 
granting powers to the National Water Resources Board 
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Deputize agents, whether public or private entities, to perform any 
of the duties enumerated in this Chapter. 
SECTION 6. Protected Areas and Ancesfral Domains. -- Where there 
are protected areas and ancestral domains within the river basin or watershed, 
the Protected Areas Management Board (PAMB) and the indigenous people, 
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respectively, shall continue to manage the water resources in their areas, in 
coordination with the Authority. For purposes of this Act, watershed shall mean 
land area drained by stream or a fixed body of water and its tributaries having a 
common outlet for surface run off. 
SECTION 7. 
Prohibited Acfs. 
-- 
The following developmental 
undertakings on watersheds shall be prohibited: 
a) 
road construction, except access roads necessary for the efficient 
surveillance of the watershed area, and farm to market roads which 
provide lifeline support to the people in the community; 
b) 
establishment of residential, commercial, industrial subdivisions 
and golf courses; 
c) 
logging; 
d) 
e) 
farming utilizing inorganic fertilizers; and 
all other land and resources useslinfrastructure projects which are 
found to be incompatible with uses of the area as a watershed. 
SECTION 8. Organizafional Sfrucfure - The Authority shall consist of 
the Office of the Director-General, the staff offices, and the field offices. Subject 
to the power of the Director-General to reorganize, restructure, and redefine the 
functions of the offices and services for the effective discharge of the powers and 
functions of the Authority under this Act, the Authority shall have the following 
Offices: Field Offices in each of the water resources zones of the country; sub- 
regional offices; the Water Regulatory Services; the Statistics and Information 
System, Administration and Finance Office; and the Office for Legal Services. 
SECTION 9. The Direcfor-General - The Authority shall be headed by 
the Director-General who shall be appointed by the President. The Director- 
General shall carry the rank and have the powers of a Secretary and shall be a 
member of the Cabinet. 
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No person shall be appointed Director-General, Deputy Director-General 
or Assistant Director General unless he or she is a citizen and resident of the 
Philippines, of good moral character, and of proven competence in any of the 
following fields: a) water or utility economics; b) public administration; c) physical 
or engineering services; d) management; e) hydrology and other related 
sciences; or f) law. 
The Director-General shall have the following powers and functions. 
a) 
establish policies and standards for the effective and efficient 
operation of the Authority; 
b) 
create sub-regional offices at the catchment level and such other 
service units as may be necessary; 
c) 
recommend to Congress the creation of catchment authorities for 
the optimal management of the water resources in the area; 
d) 
coordinate programs and initiatives of public and private entities 
and communities relating to water resources data collection, research and 
planning, as well as implementation of water development projects within the 
National Water Resources Management and Development Plan; 
e) 
reorganize the Authority as necessary for the efficient and effective 
implementation of this Act; and 
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perform such other functions as may be necessary and proper to 
attain the objectives of this Act. 
SECTION I O .  Depufy Director-General 
and Assistant Director- 
General. The Deputy Director-General and the Assistant Director-General shall 
comply with the requirements for Career Executive Service Officers under the 
Civil Service Law and other related laws, rules and regulations. 
SECTION I I. 
Wafer Resources Adjudication Board. - There is hereby 
created a Water Resources Adjudication Board, hereinafter referred to as the 
Board, under the Office of the Director-General. The Board shall be composed 
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of the Director-General as Chairperson, and two other permanent and 
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independent members to be appointed by the Director-General. The Director of 
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the Office for Legal Services shall serve as counsel to the Board. 
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The Water Resources Adjudication Board shall have the following powers: 
a. 
exercise appellate jurisdiction over decisions of the water 
adjudicatory officers in cases involving the exercise of the Authority’s regulatory 
function, including but not limited to the following: 1) disputes on raw water fees; 
2) disputes on tariffs collected by monopoly suppliers of water and/or sewerage 
services 
and 
irrigation 
services; 
3) disputes 
involving water 
permits, 
administrative allocation of water resources and transfer of water rights; 4) 
enforcement of contracts for privatized monopoly suppliers of water and/or 
sewerage services including contracts with the concessionaires of the 
Metropolitan Water Works and Sewerage Systems; 5) disputes over hydropower 
projects; 6) disputes involving monopoly suppliers of water and/or sewerage 
services and irrigation services; 7) complaints regarding the quality of service of 
suppliers of water and/or sewerage services and of irrigation services, and 8) 
such other cases specified under Presidential Decree No. 424 and Presidential 
Decree No. 1067. 
All decisions of the Board shall be final and executory fifteen (15) days 
after notice of the decision unless appealed to the Supreme Court. The decision 
of the Board with regard to tariffs and irrigation fees shall be immediately 
executory and enforcement thereof may be suspended only upon filing of a 
bond, in an amount fixed by the Board to answer for damages occasioned by the 
suspension or stay of execution. No injunction may be issued by any court to 
restrain any proceeding before the Water Resources Adjudication Board except 
on the basis of question of law by the Supreme Court on certiorari.. 
b. 
promulgate rules of procedure; 
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c. 
administer oaths and compel the attendance of witnesses and 
presentation of documents by subpoena and subpoena duces tecum; 
d. 
declare a person in contempt for non-compliance or violation of its 
Orders and in the same manner as indirect contempt of a regional trial court 
upon application by the Board or the aggrieved party herein; and 
e. 
exercise such other powers as may be necessary to carry out its 
duties and responsibilities under this law. 
SECTION 12. Water Resources Consultative Council - Every field 
office, and each catchment office, shall have a Water Resources Consultative 
Council which shall serve as its permanent advisory council. 
It shall be 
intergovernmental and multi-sectoral. 
Pursuant to Section 5 of this Act, the 
Council may submit water resources management plans to the Authority for 
approval. 
The Council shall also provide a venue for alternative dispute 
management for conflicts within their jurisdiction. 
SECTION 13. 
Monopoly Suppliers of Wafer and/or Sewerage 
Services and lrrigafion Services. - All public and private monopoly suppliers 
of water and/or sewerage services including, but not limited to local government 
units and local water districts, shall be required to procure a Water and/or 
Sewerage Services Operating License from the Authority as a pre-requisite to its 
operation. All public and private monopoly suppliers of irrigation services, shall 
likewise be required to procure an Irrigation License from the Authority; Provided, 
that all local government units involved in the supply of irrigation services shall 
register with the Authority; Provided, further, that when any such irrigation activity 
or project(s) of the local government units are privatized, they shall be required 
to procure license under this provision 
The license shall include, but shall not be limited to provisions on : a) 
exclusive right to supply water and/or sewerage services in the franchise area 
subject to the right of other legal service providers already operating in the area; 
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b) standards on the quality of drinking water, sewage discharge, and service 
efficiency; c) the nature of services to be provided; d) duration of the license; e) 
tariffs to be charged; 9 the basis for variance of the tariffs, if any; g) reporting 
requirements; and h) sanctions for failure to comply with the standards set. 
Water supply shall as much as possible be integrated with sewerage services. 
The Authority shall promote and approve the consolidation of drinking 
water, sewerage, irrigation and other water utility services to improve efficiency 
and cost of service, as well as to promote investments. Licensees must have 
technical, financial, and managerial capability to provide the services. All holders 
of the Operating License shall be subject to a periodic performance audit by the 
Authority or its designated agents. 
All existing holders of Certificates of Conformance issued by the Local 
Water Utilities Administration (LWUA) shall be automatically granted an 
operating license. Water districts shall continue to have their franchise areas 
granted under Presidential Decree 198 subject to the guidelines set by the 
Authority on the rights and obligations of an operating license holder. LWUA 
shall continue to issue Certificates of Conformance to water districts to ensure 
compliance with its standards 'and procedures established. The Authority shall 
regulate the rates set by local water districts as approved by the LWUA. 
For the purpose of this section, monopoly supply of water, sewerage 
and/or irrigation services refer to the situation where an entity operating a piped 
water network and/or piped sewerage services from any water source can 
influence or dictate the price of water and exclude competition. The term 
monopoly shall include, but shall not be limited to piped water network of service 
coming from surface water, ground water, and desalinated water. 
SECTION 14. 
Non-monopoly wafer supply and/or sewerage and 
irrigafion service provider - All wells for domestic use and all Rural 
Waterworks and Sanitation Associations and Barangay Waterworks and 
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Sanitation Associations shall be registered with the Authority. 
All local 
government units, associations; and other entities engaged in water supply and 
sanitation services, and irrigation services not amounting to a monopoly shall 
register their operations with the Authority. 
SECTION 15. Incentives for the Use of Clean and Water Saving 
Technology - In order to encourage the sustainable utilization of water 
resources, the Authority shall recommend to the Board of Investments the grant 
to public and private entities of incentives such as: 
a) 
exemption from custom and tariff 
duties for the importation of 
“clean and water-saving technology” as defined by the Authority; and 
b) 
tax rebate of up to fifty percent of the actual cost of the “clean” 
equipment or technology to be imported or purchased. 
SECTION 16. 
Environmental lmpact Assessment for Large Scale 
Abstraction or Diversion of Water. - All large-scale water abstraction, 
diversion, and appropriation activities shall be considered as environmentally 
critical projects and shall be covered by Presidential Decree No. 1586, its 
implementing rules and other related laws, rules and regulations. 
SECTION 17. lnfegration of Wafer Resource Management Plan fo 
Zoning and Land Use Plans - All national and local zoning or land use plans 
shall integrate water resource management plans. 
SECTION d8. Visitorfa/ Power and Access to Records - The Authority 
may authorize its representatives or any deputized agent to enter any public or 
private property, buildings or enclaves, whether inhabited or not, for the purpose 
of conducting hydrologic surveys, and investigations on conditions of installed 
water facilities and compliance with water laws and standards and the Authority’s 
rules and regulations. The Authority or its authorized agents may at any time 
have access to any record and photocopy the same for the above declared 
purposes. 
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SECTION 19. Contingency Powers - In times of critically low water 
levels and when there is immediate danger to the major sources of water supply, 
as determined by the Authority, the Authority shall have the power to convene an 
intergovernmental emergency committee to protect water resources through: a) 
designation of critical watersheds; b) imposition of land use controls; c) 
promulgation of measures to recover costs from responsible parties; and d) 
undertaking of such other emergency actions as it deems necessary to protect 
the water sources. 
Where there is prima facie evidence that the water level is critically low or 
where there is immediate danger to the major sources of water supply, the 
Authority may issue ex-parte temporary cease and desist orders provided that 
such case is subsequently endorsed to the appropriate government agency for 
proper action. The agency concerned shall act within fifteen (15) days from such 
endorsement. 
SECTION 20. Transfer of Powers and Functions and Assefs - The 
powers and functions of the National Water Resources Board (NWRB) under 
Presidential Decree Nos. 424 and 1067 and other laws, are hereby transferred to 
the Authority. The transfer of powers and functions shall include the transfer of 
all funds and appropriations including records, equipment, property, personnel 
and unexpended appropriations and/or allocations of the NWRB to the Authority. 
The same shall apply to government agencies which have not been abolished 
but whose functions have been effectively transferred to the Authority. Officers 
and employees of said offices, agencies and government units shall continue in 
a hold-over capacity until such time as the new officers and employees of the 
Authority shall have been duly appointed pursuant to the provisions of this Act. 
SECTION 21. Transfer of Rights and Liabibfies - The Authority shall 
be subrogated to all the rights and assume the liabilities of the NWRB, and other 
government agencies and units whose functions and powers have been 
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transferred to the Authority and shall be acted upon in accordance with the rules 
and regulations of the Commission on Audit and other pertinent laws, rules and 
regulations. 
SECTION 22. Sfaffing - The positions herein created shall be filled by 
regular appointments in accordance with a staffing plan prepared by the Director- 
General. The personnel of the NWRB shall be given preference in the positions 
herein created; Provided, however, that such personnel shall comply anew with 
the qualification standards set by the Authority for the positions for which may 
apply. 
There shall be an early retirement incentive for employees who shall be 
separated from the service. 
SECTION 23. 
Transitory Managemenf Plan - The Authority shall 
formulate a transitory management plan for the phase-in of its operations. The 
Authority shall be fully operational within one year from the effectivity of this Act. 
The Authority shall phase-in the effectivity of the new schedule of fees for 
the appropriation of raw water within three years from the approval of this act. 
The new raw water fee shall be implemented in the irrigation sector within a 
period of five (5) years from the approval of this Act. 
SECTION 24. Penalties - 
a) 
Any person, natural or juridical, found violating the provisions of 
this Act and its Implementing Rules and Regulations shall be liable to pay a fine 
not exceeding Five Million Pesos (P5,000,000.00) or imprisonment from six 
months to six years, or both. If the offense is committed by a corporation, 
partnership, association or any other juridical person, the penalty shall be 
imposed against the officer/s member/s andlor employee/s who took part in the 
commission of the offense, Who consented thereto or who is/are otherwise 
responsible. This is without prejudice to the filing of civil and administrative 
action against said corporation, partnership, association or other juridical person; 


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b) 
Any person or entity who shall refuse, obstruct or hamper the entry 
of the duly authorized representatives of the Authority into any property of the 
public domain or private property pursuant to its visitorial powers, shall be liable 
to pay a fine not exceeding ten thousand pesos (P10,OOO.OO) or imprisonment 
not exceeding one (I) 
month, or both. 
SECTION 25. Fees, Administrative Fines and Sanctions - 
a) 
The Authority may suspend or revoke any water permit or license 
issued to any person or entity who shall violate any of the terms and conditions 
therein set forth and/or any rules and regulations promulgated by the Authority. 
b) 
The Authority may issue a cease and desist order against any 
person or entity found to be violating any of the provisions of this Act, the Water 
Code, its implementing rules and regulations or any order or decision of the 
Authority. 
c) 
The Authority shall declare a person in contempt for non- 
compliance with or violation of its orders. The person so declared in contempt 
shall be punished in the same manner as indirect contempt of a Regional Trial 
Court,. motu proprio or upon application by any aggrieved party herein. 
d) 
The Authority shall promulgate rules and regulations for the 
imposition of administrative fines and sanctions for failure to comply with any 
order, decision, rule and regulation of the authority. 
e) 
Fees and revenues collected shall be retained by the Authority 
forming a trust fund which shall be allocated among the 1) the share of the local 
government unit in the exploration of natural resources within its territory in 
accordance with the Local Government Code; 2) administrative costs of 
operation of the authority and its deputized agents; 3) awareness building for 
sustainable water resources utilization, development and management; 4) 
community-based water resources planning efforts; 5) financial grants for data 
collection, water impoundment and development projects, water source 
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protection projects such as reforestation and watershed protection, research 
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activities for the development of technology which advances the sustainable 
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utilization of water resources; 6) subsidies for water supply and sewerage 
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projects to low-income communities; 7) subsidies from the Water Resources 
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Development Fund for the import or purchase of “clean” equipment or 
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determined by the director-general. 
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SECTION 26. 
Compensation for Damages - Compensation for 
technology; 8) compensation for payment of water rights; 9) capability building 
for community-based water resources management; I O )  other areas priority as 
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damages to water sources, due to pollution from identified sources, salt water 
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intrusion of aquifers by reason of unauthorized abstraction of underground water, 
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and other damages resulting from violations of the Water Code, its rules and 
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regulations, and wrongful acts punishable by law, which result in the 
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deterioration of the quality of water supply sources, shall be collected by the 
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authority. 
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SECTION 27. 
Appropriations - Such sums necessary for the 
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implementation of this Act shall be taken from the current fiscal year 
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appropriation of the National Water Resources Board and such amounts as the 
President of the Philippines may allocate from other sources in accordance with 
law. Thereafter, the amount needed for the operation and maintenance of the 
Authority shall be included in the annual General Appropriations Act. The funds 
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collected or which otherwise come into the possession of the Authority and its 
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Offices from fees, surcharges, fines and penalties which the Authority may 
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impose and collect under its Act shall be disbursed for expenses necessary for 
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SECTION 28. Rules and Regulations -- The Authority in coordination 
the effective discharge of the powers and functions of the Authority. 
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with the DENR, shall, promulgate such rules and regulations for the proper 
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implementation of this Act. 
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SECTION 29. Repealing Clause - Section 4(b) of Presidential Decree 
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No. 66, as amended, Presidential Decree No. 424, Section 45 (a) AND 62(A) of 
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Presidential Decree No. 198, as amended and NWRB Resolution No. 1444, 
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Series of 1980, as amended, are hereby repealed. Republic Acts Nos. 3601, 
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4850, 6234, 7227, 7916 and 7922; Presidential Decrees Nos. 66, 198, 926, 
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1556, 1067 and 1586, and Executive Orders No. 124, 192 and 230 are hereby 
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modified accordingly. All laws, decrees, executive orders, memorandum orders, 
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memorandum circulars, administrative orders, ordinances or any part thereof, 
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inconsistent herewith are hereby deemed repealed or modified accordingly. 
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SECTION 30. Separability Clause. - In the event that any provision of 
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this Act is declared unconstitutional, the validity of the remainder shall not be 
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affected thereby. 
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SECTION 31. Effectivity Clause. - This Act shall take effect fifteen (1 5) 
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days after its complete publication in the Official Gazette or in at least two (2) 
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newspapers of general circulation. 
Approved, 
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