Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City

SIXTEENTH CONGRESS
First Regular Session

1179

HOUSE BILLNO,_—

Introduced by HONORABLE ROMERO FEDERICO “MIRO” S. QUIMBO

EXPLANATORY NOTE

This bill seeks to create the Social Housing Development and Finance Corporation
(SHDFC) which shall become the lead government agency in the development and
administration of social housing programs.

On 20 January 2004, the Social Housing Finance Corporation (SHFC) was created by
virtue of an executive order (Executive Order No. 272), upon the recommendation of the
Housing and Urban Development Coordinating Council (HUDCC) Secretariat. SHFC, a
wholly owned subsidiary of the National Home Mortgage Finance Corporation (NHMFC),
was tasked to implement the CMP and AKPF programs under the NHMFC and undertake
social housing programs for the formal and informal sectors in the low-income bracket.

In its seven years of existence, SHFC’s weaknesses were readily observable, if not
glaring. EO 272 vaguely defined the powers of the President of the Corporation, of the Board
of Trustees, and of the Corporation itself. As a consequence, the SHFC performed limited
functions to the detriment of the State’s goal to make available affordable decent housing and
basic services to underprivileged and homeless citizens in urban centers and resettlement
areas, Furthermore, EO 272 failed to provide a concrete set of qualifications for the President
of the Corporation which could have adverse impact on the management of the institution.

‘This bill seeks to address these weaknesses and concerns. The passage of this bill
would establish a more independent, well-organized and transparent SHDFC that is more
responsive to the housing needs of the Filipino people. It hopes to do this given its salient
features:

First, “it defines the powers and functions of the SHDFC. One of the weaknesses of
EO 272 is the vagueness and lack of enumeration of the powers and functions of SHFC. The
EO merely mandated the NHMFC to define such.

Second, the Board of Trustees of the SHDFC is likewise empowered to adopt the
bylaws of the Corporation, formulate and revise policies related to housing, approve the
Corporation's organizational and administrative structures and staffing pattern, and exercise
other powers necessary to carry into effect the provisions and purposes of SHDFC.


Third, it mandates the Secretary of Department of Finance to sit as ex-officio Vice
Chairman of the Board of Trustees. This will guarantee that the acts and decisions of the
Corporation shall be within the financial capabilities of the Government. Further, it provides
qualifications for the four private sector representatives that will sit as members of the Board.

Fourth, qualifications for the President are specified. This is to ensure that the
President of the SHDFC will be experienced and competent to decide on matters related to
housing,

Fifth, this bill seeks to require the Chairman of the Commission on Audit to submit an
annual report of the financial condition and operation of SHFDC to the President and both
houses of Congress. This is to certify the transparency of and within the Corporation.

Sixth, this bill institutionalizes and strengthens the foundation of SHDFC by enacting
a legislation that is not vulnerable to ready repeal by subsequent Presidents of the Republic.

In view thereof, the expedient approval of this bill is strongly recommended.

ROMERO FEDER{CO “MIRO” S. QUIMBO
epresentative

Second District Marikina City


Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City

SIXTEENTH CONGRESS
First Regular Session

1179

HOUSE BILL NO.

Introduced by Rep. Romero Federico “Miro” S. Quimbo

AN ACT
TO CREATE THE SOCIAL HOUSING DEVELOPMENT AND FINANCE
CORPORATION, PRESCRIBING ITS POWERS AND FUNCTIONS, AND FOR
OTHER PURPOSES

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 “Social Housing Development and
Finance Corporation Act of 2013.”

SEC. 2. Declaration of Policy. - It is hereby declared the policy of the State to undertake
a comprehensive and continuing program of housing and urban development which will
make available at affordable cost decent housing and basic services to the underprivileged
and homeless Filipinos through the financing and administration of socialized housing
programs

SEC, 3. Statement of Objectives. - Toward this end, the State shall integrate all laws,
orders, issuances and administrative circulars relating to the provision of socialized housing
to effectively achieve the following objectives

(a) To assist legally-organized associations of underprivileged and homeless citizens to
purchase and develop tracts of land and to own lots they occupy or where they choose to
relocate to under the concept of community ownership: and

(b) To enhance the affordability of low-cost housing by low-income families and provide
developmental financing for low-cost housing projects.

SEC. 4, The Social Housing Development and Finance Corporation. - To carry out the
aforementioned policy and objectives, there is hereby created a Social Housing Development
and Finance Corporation (SHDFC), herein referred to as the “Corporation,” with principal
office in Metro Manila, which shall replace the Social Housing Finance Corporation (SHFC)
created by virtue of Executive Order No, 272 issued on 20 January 2004

The corporation shall be the lead government agency to undertake social housing
programs that will cater to the formal and informal sectors in the low-income bracket and
shall take charge of developing and administering social housing program schemes.


SEC. 5. Social Housing Programs, ~ Consistent with Republic Act No, 7279, as
amended, otherwise known as the “Urban Development and Housing Act of 1992,” Republic
‘Act No. 6846, as amended, otherwise known as the “Abot-Kaya Pabahay Fund or Social
Housing Support Fund Act,” and Republic Act No. 7835, otherwise known as the
“Comprehensive and Integrated Shelter Financing Act of 1994,” the corporation shall
implement the following programs:

(a) Community Mortgage Program (CMP) ~ this program shall assist legally organized
associations of underprivileged and homeless citizens to purchase and develop a tract of land
under the concept of community ownership. The primary objective of the program is to assist
residents of blighted or depressed areas to own the lots they occupy, or where they choose to
relocate to, and eventually improve their neighbourhood and homes to the extent of their
affordability

(b) Abot-Kayar Pabahay Fund Program (AKPFP) ~ this program seeks to implement
continuing program of social housing that shall make available to low-income families
affordable houses and/or lots through (a) amortization support whereby funds are made
available for low income families to assist them in paying their housing loans; and (b)
development financing where funds are utilized to support private developers, non-
governmental organizations (NGOs) and landowners in providing affordable housing
packages to low-income families,

In addition to the foregoing major programs of the corporation, i is also tasked to develop
and implement other social housing programs such as, but not limited to, the Localized
Community Mortgage Program (LCMP), a CMP derivative that allows local government
units (LGUs) to address the housing needs of informal settlers and low-income sectors in
their respective jurisdictions,

SEC. 6. Powers and Functions of the Corporation, ~ The corporation shall have the
following powers and functions:

(@) To promote land ownership, giving priority to the underprivileged and homeless
citizens of the society

(b) To encourage maximum participation of LGUs, NGOs, and people’s organizations
(POs) to ensure that homeless citizens and the underprivileged can enjoy the benefits of the
programs of the corporation;

(©) To institutionalize and promote housing aided by self-help methods whereby families
with their own and/or outside financing can build their homes with their labor and such other
self-help approaches in home ownership, and introduce support facilities that will enhance
the capabilities of low-income groups to acquire decent housing:

(d) To assist LGUs to serve the housing requirements in their respective jurisdictions,
such as resettlement, development of sites and services, and the renewal of blighted areas;

(©) To formulate, adopt, amend and/or rescind such rules and regulations as may be
necessary to carry out the provisions and purposes of this Act, as well as the effective


exercise of the powers and functions, and the discharge of duties and responsibilities of the
corporation, its officers and employees ;

( To purchase, acquire, sell, discount, refinance or otherwise deal in community or
home mortgages or participate therein or engage in estate management under such conditions
and terms as maybe determined by the Board of Trustees of the corporation;

(g) To provide a strong and sustainable finance program supporting the housing
objectives and, in relation thereto, to borrow or raise money necessary to meet the financial
requirements of its business by the issuance of bonds, promissory notes, and other evidences
of indebtedness, and {o secure the repayment thereof by mortgage, pledge, deed of trust upon
the properties of the corporation;

(h) To invest and deal with the money and properties of the corporation in such manner as
may, from time to time, be considered wise or expedient for the advancement of its interests
and to sell, dispose of, or transfer the business, properties, and goodwill of the corporation, or
any part thereof for such consideration and under such terms as it shall see fit to accept:

(@ To enter into any lawful arrangement for joint venture, profit-sharing, union of
interest, unitization, or trust agreement, reciprocal concession, or cooperation with any
corporation, association, partnership, syndicate, entity, person, or governmental, municipal,
or public authority, domestic or foreign, in the carrying on of any business or transaction
deemed necessary, convenient, or incidental to the carrying out any of the purposes of this
corporation:

(i) To acquire or obtain from any government or authority, national, provincial, municipal
or otherwise, or any corporation, company, or partnership, or person, such charter, contracts,
franchise, privileges, exemption, licenses and concessions as may be conducive to any of the
objectives of the corporation;

(k) To establish and operate one or more branches, offices, or agencies and to carry on
any or all of its operations and business without any restrictions as to place or amount,
including the right to hold, purchase or otherwise acquire, lease, mortgage, pledge, sell and
convey, or otherwise deal with real and personal property anywhere in the Philippines, as
may be necessary, or incidental to the conduct of the corporate business;

(To conduct and transact any and all lawful activities, and to do or cause to be done any
one or more of the acts and purposes set forth herein, within or outside the Philippines, and in
any and all foreign countries, and to do everything necessary, desirable, or incidental to the
accomplishment of the purposes or the exercise of any one or more of the powers herein
enumerated or which shall, at any time, appear conducive to or expedient for the protection or
benefit of this corporation;

(m) To adopt, alter, and use corporate seal, to sue and be sued, and generally, to exercise
all powers under the corporation laws which are not inconsistent herewith and/or existing
laws; and

(n) To exercise such powers and perform such acts as may be necessary, useful, incidental
or auxiliary to carry out the provisions of this Act.


SEC. 7. Board of Trustees. - The corporation shall be governed and its activities directed,
controlled, and managed by a Board of Trustees, hereinafler referred to as the “Board” which
shall be composed of the following:

(a) The Chairperson of the Housing and Urban Development and Coordinating Council,
as the ex officio Chairman;

(b) The Secretary of the Department of Finance as ex-officio Vice Chairman;

(c) The Secretary of the Department of the Interior and Local Government, or her/his duly
designated representative;

(a) The Secretary of the Department of Budget and Management (DBM) or his/her duly
designated representative,

(e) The Governor of the Bangko Sentral ng Pilipinas (BSP) or his/her duly designated
representative;

(0) The President of the National Home Mortgage Finance Corporation;
(g) The President of the Corporation; and

(h) Four (4) representatives of the private sector who shall each be appointed by the
President of the Philippines for a term of five (5) years: Provided, That he/she shall be a
citizen and a resident of the Philippines, of good moral character, of known probity, and of
proven competence and integrity, a holder of a degree in law, public administration, urban
planning, development studies, economics, civil engineering or other related course with
special training in housing and urban development programs, preferably in shelter finance
management, from a recognized college or university: Provided, further, That he/she must
have an experience in the development of housing projects, organization of housing
associations, or management of shelter finance programs and other related activities for at
least five (5) years.

The Chairman, Vice Chairman and members of the Board shall be entitled to a reasonable
per diem for each meeting actually attended at such amounts as may be fixed by the Board in
accordance with existing laws, rules and regulations

SEC. 8. Powers of the Board. - The Board shall have the following powers:

(a) To adopt the bylaws of the corporation, and to revise or amend the same as may be
expedient to carry out effectively the functions of the corporation under this Act;

(b) To formulate, revise, or adjust periodically all policies, and to promulgate such rules
and regulations and manuals of procedure as are necessary to ensure the effective
implementation of the provisions of this Act;

(©) To direct the management, operation, and administration of the corporation;

(d) To authorize such expenditures by the corporation as are in the interest of its effective
administration and operation;


(©) To approve the corporation's organizational and administrative structures and staffing
pattern, and create offices or positions necessary for the efficient management, operation, and
administration of the corporation, and to establish the appropriate compensation package for
the officers and employees of the corporation: Provided, That all positions in the corporation
shall not be exempt from Republic Act No. 6758, otherwise known as the Salary
Standardization Law, and other existing laws, rules and regulations on salaries and
compensation; and

(0) To exercise such powers as may be necessary to carry into effect the provisions of this
‘Act and to accomplish the purposes for which the corporation is established.

SEC. 9, President of the Corporation, ~ The President of the Corporation shall be
appointed by the President of the Philippines for a term of five (5) years: Provided, That
he/she shall be a person of good moral character, unquestionable integrity, of known probity
and patriotism, a holder of a degree in law, public administration, urban planning,
development studies, business or economics, or other related course with special training in
housing and urban development programs, preferably in shelter finance management, from a
recognized college or university: Provided, further, That he/she must have expertise and
experience of at least ten (10) years in business, finance, the professions, development of
housing projects, organization of housing associations, and management of shelter finance
programs and other related activities, He/she shall represent the corporation in all its dealings
with other offices, agencies and instrumentalities of the government and with all persons and
entities, public or private, domestic or foreign, He/she shall exercise such other powers,
functions, and duties as may be delegated by the Board and she shall receive such reasonable
compensation, allowances and other emoluments as Board may be determine

SEC. 10. Powers and Duties of the President of the Corporation. - The President of the
Corporation shall prepare the agenda of the Board of Trustees, execute and administer the
policies and r approved by if, and direct and supervise the operations and
management of the corporation, Subject to the approval by the board in the case of
managerial positions and above and subject to the confirmation by the board in the case of
positions below managerial level, the president shall appoint the personnel of the corporation,
prescribe their duties and qualifications, in accordance with existing civil service laws, rules
and regulations, to the end that only competent personnel may be employed, and, when
warranted, remove, suspend or otherwise discipline them for cause.

SEC. 11. Abolition of the SHFC and Transfer of its Powers and Functions, Rights,
Assets, and Liabilities. - The SHFC is hereby abolished. Within six (6) months from the
approval of this Act, the powers and functions of the SHFC and the programs under its
administration, in particular the CMP and the amortization support and the developmental
financing programs under the AKPFP, and such other related social housing programs being
implemented by it, shall be transferred to and be exercised by the corporation, The
corporation shall, by virtue of this Act, be subrogated to all the rights and assume all the
contracts and liabilities of the SHFC and all its pertinent funds and appropriations, including
unexpended allocations, records, property, assets, equipment and personnel as are necessary
Provided, That the existing officers and employees of the SHFC shall continue to assume
their posts in a holdover capacity until their new appointments are issued.



SEC. 12. Structure and Staffing Pattern, - The position structure and staffing pattern of
the corporation shall be subject to the approval of the DBM, To ensure the continued
implementation of the CMP and the AKPFP during the period of transfer and transition, the
SHEC personnel who are performing the functions transferred to the SHDFC shall continue
to perform their duties; Provided, That the said personnel may, at their option, retire or be
separated from the service for which they shall be entitled to the benefits provided by law at
the time of retirement or separation.

SEC. 13, Appropriations, - The amount needed for the initial implementation of this Act
shall be charged against the current year’s appropriation for the CMP and the funds for the
AKPEP being administered by the SHFC. Thereafter, such sums as may be necessary for the
continued implementation of this Act shall be included in the General Appropriations Act

SEC. 14. Interim Applicability of Existing Policies, Guidelines, and Rules. ~ Existing
policies, guidelines, rules and regulations with respect to the functions of the SHFC which
have been transferred to the SHDFC shall continue to be applicable and in effect until
amended or modified accordingly.

SEC. 15. Audit, - The Chairman of the Commission on Audit shall appoint and assign to
the corporation a Resident Auditor and other subordinate personnel, responsible to and
removable only by the said Commission on Audit Chairman, to perform audit duties, without
prejudice, however, to the power of the Board of Trustees to contract another mode of
independent audit service, in addition to that provided by the Commission on Audit as
provided for under Presidential Decree No. 1445, otherwise known as the Government
Auditing Code of the Philippines. The Auditor shall submit, through the Commission, an
annual report on the financial condition and the result of the operations of the corporation to
the President of the Republic of the Philippines and to the Senate and the House of
Representatives

SEC. 16. Reports. — The corporation shall submit an annual report to the President of the
Philippines and to both chambers of the Congress of the Philippines.

SEC. 17. Suppletory Application of the Corporation Code. ~ The provision of the
Corporation Code shall have suppletory application on matters not provided in this Act.

SEC. 18. Implementing Rules and Regulations, — The implementing rules and
regulations to effectively carry out the provisions of this Act shall be adopted and
promulgated by the Board of Trustees of the corporation not later than ninety (90) days after
the approval of this Act which shall be published in a t least one (1) national newspaper of
general circulation,

SEC. 19, Repealing Clause. - All laws, decrees, executive orders, or rules and regulations
and other issuances, or parts thereof which are inconsistent with or contrary to the provisions
of this Act or its purposes are hereby repealed, amended, or modified accordingly

SEC. 20. Separability Clause. - If, for any reason, any provision of this Act, or the
application thereof to any person or circumstances, is held invalid or unconstitutional, the
remaining provisions not affected thereby shall continue to be in full force and effect


SEC. 21. Effectivity. - This Act shall take effect fifteen (15) days afer its complete
publication in the Official Gazette or in at least two (2) national newspapers of general
circulation,

Approved,