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

HOUSE OF REPRESENTATIVES

Introduced by Representative Maximo B. Rodriguez, Jr.

House Bill No. by
EXPLANATORY NOTE

The scarcity of affordable housing affects all sectors of society,
especially our public school teachers. An independent survey revealed that
public school teachers have no homes to call their own.

Majority of our public school teachers cannot afford to purchase their
own homes at market prices since they earn a gross monthly income of
P10,000 or less. In addition to this, more than 20% of our public school
teachers have unemployed spouses, and thus, bear the burden of providing
for their families.

There had been efforts to solve this problem by providing for a special
housing facility through the state pension fund. However, its implementation
never fully materialized. Thus, it is imperative that we provide for a stable
housing program for our teachers through legislation.

This bill seeks to institute a housing program for teachers by providing
funds through loans at affordable interest rates and long-term repayment
period. It also seeks to involve the private sector in providing housing units
exclusively for teachers through the grant of fiscal incentives.

In view of the foregoing, the passage of this bill is earnestly sought.

MAXIMO B. RODRIGUEZ, JR.


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

HOUSE OF REPRESENTATIVES

Introduced by Representative Maximo B. Rodriguez, Jr.

House Bill No. 6845

AN ACT
TO PROVIDE FOR A HOUSING PROGRAM FOR TEACHERS

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 “Teacher's Housing
Program Act.”

SEC 2. Declaration of Policy. It is hereby declared the policy of the State to
uplift the living conditions of teachers and promote a housing program to
enable them to acquire their own housing units. To this end, the State affirms
its commitment to strengthen, promote, and support the component activities
of housing production and finance in order to enable teachers to acquire
decent housing and basic services at the lowest affordable price.

SEC 3. Coverage. The Program shall cover the teachers of the Department
of Education (DepEd) with a permanent status.

SEC 4. Role of Government Housing and Financing Agencies. To ensure the
accomplishment of the objectives under this program, the hereunder
mentioned housing agencies shall perform the following in addition to their
respective existing powers and functions:

(a) The National Housing Authority shall undertake special housing
projects for teachers. In addition, it may also provide technical
and other forms of assistance to private developers in the
development of housing projects;

(b) The National Home Mortgage Finance Corporation shall provide
the mortgage market for teacher’s housing through the purchase
of teacher's housing mortgages and/or issuance of securities. It
shall administer the funds provided for housing loans and
developer assistance under this Act as well as long-term funds
provided by the Government Service Insurance System and the
Home Development Mutual Fund for teacher's housing.

(c) | The Home Guaranty Corporation shall design an appropriate
guarantee scheme to encourage financial institutions and private
developers to undertake mass housing production for teachers.
It shall administer the Guarantee System Fund as provided for
under this Act.


(d) The Government Service Insurance System and the
Development Mutual fund shall be the primary provider of funds
for long-term housing mortgages.

SEC 5. Role of the DepEd. The Department of Education shall undertake the
implementation of the program among its teachers and shall ensure collection
of amortization payments through a salary deduction scheme. In line with
this, the DepEd shall:

(a) Create a Teacher's Housing Secretariat which shall issue and
collect the necessary documentation, receive and process
application, and transfer the same to the appropriate housing
agencies;

(b) | Deduct amortization from their teachers on a monthly basis and
remit the same to the appropriate agency.

SEC 6. Program Financing Scheme. In the implementation of the Teacher's
Housing Program, the following shall consist the financing scheme

(a) | Housing Loans for Teachers which shall be used for any of the
following purposes:

1. Purchase of a lot and construction of a residential unit
thereon;

2. Purchase of any of the following:

a. brand new or old existing units;

b. housing properties mortgaged with any institution;

c. housing assets being disposed of through public
bidding or negotiated sale;

3. Purchase of a fully developed lot within a residential area;

4. Construction or completion of a residential unit on a lot
‘owned by the beneficiary;

5. Home improvement or any alteration in an existing
residential unit;

6. Restructuring of an existing housing loan in any
government housing or financial institution, provided that
the account is updated

Loans provided under this program shall be computed based on
a net take home pay which shall not be lower than Three Thousand
Pesos (P3,000.00). The interest rate on the loan shall not be more
than twelve percent (12%) per annum and shall be fixed for the entire
term of the loan. Provided, that if the borrower defaults on his
amortization payment for reasons of his own doing, the financing
agency may subject the borrower to a regular interest rates for the
periods that he is in default.

To increase the benefits provided to teachers, loans under this
scheme shall not be subject to such charges, fees or premiums except
minimum processing fees to be charged by the appropriate agencies.

Loans provided for teachers eaming less than twelve thousand
pesos (P12,000.00) per month shall not be less than sixty percent
(60%) of all available funds allotted for this purpose. At least forty five


(b)

(c)

percent (45%) of the year appropriation for the Program shall be for
Housing Loans.

Developer Assistance Fund. Proponents or developers of housing
projects exclusively for teachers and with a selling cost not exceeding
One Hundred Twenty Thousand pesos (P120,000.00) per house
and/or lot package which shall be available exclusively for teachers,
may avail of a financing loan not exceeding eighty percent (80%) of the
entire project cost. The National Home Mortgage and Finance
Corporation, in coordination with the HUDCC, shall issue the
appropriate guidelines for this purpose.

At least fifteen percent (I5%) of the yearly appropriation for the
program shall be for developer financing: Provided, that the unused
funds for developer financing shall be utilized for Housing Loans.

Guarantee System Fund. There is hereby created a guarantee system
fund for Teacher's Housing Loans not exceeding One Hundred Fifty
Thousand Pesos (PI50,000.00) with an interest rate of not exceeding
twelve percent (I2%) per annum as originate by the funding agencies or
their accredited financial institutions. Such loans shall be assigned to
the Fund immediately after origination for which the Fund shall issue
promissory notes.

At least forty percent (40%) of the yearly appropriation for the
Programs shall be for the loan guarantee. The Home Guarantee
Corporation shall undertake the guarantee system under this act and
shall act as the administrator and trustee of the fund. The HGC shall
issue the appropriate guidelines within one (1) year from the approval
of this Act.

SEC 7. Fiscal Incentives for Private Sector Participation in Teacher's
Housing. Private sector developers who participate in the development of
teacher's housing shall be entitled to the following fiscal incentives:

(a) Exemption from income taxes for housing projects exclusively
dedicated for teachers;

(b) Exemption from capital gains tax on housing projects exclusively
dedicated for teachers;

(c) Exemption from documentary stamp tax for all project related
documentation;

(d) _ Exemption from value-added tax for the project concerned;

(e) Exemption from transfer taxes for both raw and completed
projects; and

(f) Exemption from donor's tax for lands certified by the local
government units to have been donated to teacher’s housing
Purposes.

Provided, that upon application for exemption, the housing

development plan shall have already been approved by the appropriate
government agencies concerned: Provided further, that all the savings
acquired by virtue of this provision shall be used to minimize the cost of the


housing units subject to the implementing guidelines to be issued by the
Housing and Urban Development Coordinating Council.

The Department of Finance, in consultation with the Housing and
Urban Development Coordinating Council, shall prepare the necessary
implementing guidelines for the proper implementation of the tax exemption
mentioned in this section within one (1) year after the approval of this Act

SEC 8. Funding Source. The Government Service Insurance System and
the Home Development Mutual Fund shall contribute a total of Two Billion
Pesos (P2,000,000,000.00) for the initial implementation of the Program.
Thereafter, each institution shall allocate at least ten percent (10%) of their
annual investible funds for long-term teachers’ housing mortgages and shall
be made available to the National Home Mortgage and Finance Corporation
under terms which ensure their repayment. The National Government shall
contribute One Billion Pesos (P1,000,000,000.00) annually for the continuous
implementation of the Program.

SEC 9. Appropriation. The amount necessary to carry out the purposes of
this Act shall be included in the General Appropriations Act of the year
following its enactment into law and every year thereafter.

SEC 10. Separability Clause. If for any reason, any provision of this Act is
declared invalid or unconstitutional, the remaining provisions not affected
thereby shall continue to be in full force and effect.

SEC 11. Effectivity. This Act shall take effect fifteen (I5) days after its
complete publication in at least two (2) newspapers of general circulation.

Approved,