Republic of the Philippine
HOUSE OF REPRESENTATIVES
Quezon City

SIXTEENTH CONGRESS i 30 JUL 2013
First Regular Session B
House Bill No, 2094

INTRODUCED BY : REP. MARIANO U. PIAMONTE, JR. and
REP. JULIETA R. CORTUNA

EXPLANATORY NOTE

The Local Government Code of the Philippines (Republic Act 7160) has made it
possible for local government units (LGUs) to help make education accessible to
poor students in their localities through the establishment and operation of local
colleges and universities (LCUs).

While this is a commendable action on the part of LGUs, over time, it has created
some problems concerning the quality of education taught in these LCUs because of
the absence of definite guidelines on their establishment and operation. Hence, there
is a need to rationalize the creation of LCUs to prevent the proliferation of
substandard schools which fail to deliver quality higher education and are often
dubbed as mere “diploma mills.”

This proposed law mandates the LGU establishing a higher education institution
through an enabling ordinance to consult and coordinate with the Commission on
Higher Education (CHED) to ensure observance of the necessary requirements for
the establishment and subsequent effective operation of the LCUs.

In view of the foregoing reasons, immediate approval of this measure is earnestly

sought.
IARIANO U. a Wane

Representative
A TEACHER Partylist



Sixteenth Congress
First Regular Session

HOUSE BILL NO. 2054

Introduced by : REP. MARIANO U. PIAMONTE, JR. and
REP. JULIETA R. CORTUNA

AN ACT
PROVIDING GUIDELINES FOR THE ESTABLISHMENT AND OPERATION OF
LOCAL COLLEGES AND UNIVERSITIES, AND FOR OTHER PURPOSES

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

SECTION 1. Short Title. This Act shall be known as the “Local Colleges and
Universities Governance Act.”

SEC. 2. Declaration of Policy. It is the policy of the State to protect and
promote the right of all citizens to quality education at all levels and to take
appropriate steps to make education accessible to all. In doing so, the State shall
establish, maintain and support a complete, adequate and integrated system of
education relevant to the needs of the people and society and that it shall take into
account regional and sectoral needs and conditions and shall encourage local
planning in the development of educational policies and programs

SEC. 3. Definition of Terms. As used in this Act, the terms enumerated
herein shall have the following meaning

(a) Local Higher Education Institution (HE!)/Local College or University (LCU)
= refers to a public HEI established by a local government unit through an
establishing ordinance, and financially supported by the concerned local government
unit. In Filipino, an LCU is referred to as ‘Dalubhasaan” for college and
“Pamantasan” for university.

(b) Ordinance - refers to the enabling act of the Sangguniang Bayan,
Panglunsod or Panlalawigan that creates a particular LCU and serves as the charter
of said LCU


(c) Degree Program - refers to a collection of all courses in a field of study
leading to an undergraduate or graduate degree, and may also be referred to as
academic program

(d) Non-Degree Program - refers to a post-secondary academic and
vocational program below a bachelor’s degree.

(e) Local Government Unit or LGU - refers to municipalities, cities and
provinces that created or established the LCU.

(f) College or Dalubhasaan — refers to an HEI offering academic programs
and usually pre-professional training leading to a bachelor's degree.

(9) University or Pamantasan — refers to an institution made up of an
undergraduate division that offers bachelor's degree and graduate division that
comprises a graduate school and professional schools each of which may confer
master's and doctorate degrees. It is an entire socio-physical infrastructure
comprised of schools, colleges and Institutes offering degree programs in various
disciplines and levels.

SEC. 4. Coverage. The provisions of this Act shall apply to:

(a) New HEls to be established and operated by LGUs by virtue of local
governance;

(b) HEls to be established and operated by LGUs offering non-degree
programs but would eventually offer degree programs;

(c) Local colleges proposing (elevation to university status) reclassification as
college, professional institutions or universities; and

(d) Existing LCUs which have not met the standards of the Commission on
Higher Education (CHED) prescribed in this Act.

SEC. 5. Establishment and Operation of local HEIs by LGUs. A local HEI,
to be known as a local college or dalubhasaan, shall be established and operated by
an LGU through an ordinance duly enacted for that purpose by the Sanggunian
concerned: Provided, that before the enactment of the said ordinance, an LGU
establishing a local college shall consult and coordinate with the CHED to ensure
observance of pertinent policies and standards promulgated by CHED and
compliance with the necessary requirements for the establishment and subsequent
effective operation of the local college.

The local HEI established by LGUs shall be given a period of four years to
comply with the applicable criteria established by the CHED for the grant of college
or university status. Should CHED determine that the local HEI has not complied


with the applicable criteria despite the four-year period provided herein, the status
granted under this Act shall be automatically revoked. The CHED, through its
regional office, shall actively monitor and provide technical assistance to the local
HE! in compliance with the requirements of the Commission

No new local HE! shall be established immediately as a local university or
pamantasan, without first being established as a local college or dalubhasaan.

A local college may subsequently apply for elevation to a university: Provided,
That it has complied with the standards and guidelines for the grant of university
‘status pursuant to pertinent CHED rules and regulations and that it has followed the
appropriate process of accreditation conducted by a reliable accreditation body
which found the college prepared to be elevated into a university: Provided further,
That a local college, upon conversion into a local university, shall continue to be
operated by the concerned LGU in coordination with the CHED.

Local educational institutions offering only non-degree programs shall not use
“College” or “University” in its name unless they would eventually offer degree
programs and have complied with the requisites provided for the establishment of a
college or the grant of university status under the CHED rules and regulations:
Provided, That educational institutions which have been using the name “college” or
“university” prior to the passage of this Act shall be allowed to retain the name:
Provided further, That said educational institutions shall be given a grace period by
the CHED to comply with the requirements for the status of “college” or “university”
to make them worthy of their name.

SEC. 6. Authority to Grant “University” Status. The proposal for elevation
to “University” status shall be submitted to the Office of Programs and Standards,
CHED Central Office, through the CHED Regional Office, for review. Only the
Commission en banc shall grant the “University” status upon compliance with the
requirements.

SEC. 7. Governing Board of a Local College or University. The governing
board of a college or Dalubhasaan shall be its Board of Trustees (BOT) while the
governing board or Pamantasan shall be its Board of Regents. The governing board
of an LCU, herein after referred to as the Board, shall be composed of the following:

(a) Local Chief Executive or his duly designated representative, as
chairperson;

(b) CHED Chairperson or his duly designated representative, as co-
chairperson;

(c) President of the LCU, as vice-chairperson;


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(d) Chairperson of the House Committee on Higher and Technical Education,
as member;

(€) Chairperson of the Senate Committee on Education, Culture and the Arts,
as member;

(f) President of the duly recognized faculty association of the LCU, as
member,

(g) President of the duly recognized student council of the LCU, as member;
(h) President of the alumni association, as member;

(i) Chairperson of the Sangguniang Committee on Education, as member;
() CHED Regional Director, as member;

(k) Division Superintendent of the Department of Education (DepED), as
member ;

(!) Two (2) representatives from the private sector who have distinguished
themselves in their profession or field of specialization and are bonafide residents of
the community where the LCU is located, as members.

One of the two (2) representatives from the private sector shall come from the
business or industry sector. They shall be appointed by the local chief executive and
shall each serve for a term of two years from the date of their respective
appointments.

The terms of office of the president of the faculty association, the president of
student council, and the president of the alumni association shall be coterminous
with the respective terms of office pursuant to their respective constitutions and by-
laws.

SEC. 8. Powers of the Board, The Board shall promulgate policies on
education, science and technology, arts, culture and sports, as well as policies,
standards and thrusts in accordance with the declared state policies on higher
education, such as Republic Act No. 7722 or the “Higher Education Act of 1994” and
other pertinent laws, as well as the principle of local autonomy enshrined in Republic
Act No. 7160 or the “Local Government Code of 1991."

The CHED, in the issuance of academic policies and standards affecting
LCUs, shall take into account the different characteristics and the distinct features of
the LCUs, their organizational set-up, and their operation: Provided, That the CHED
shall, at all times, devise ways and practices that will ensure that LCUs will remain
committed to the delivery of quality education to its students.


The Board shall have the following specific powers and duties, in addition to
its general powers of administration and the exercise of all the powers granted to the
board of directors of a corporation under Section 36 of Batas Pambansa Big. 68,
otherwise known as the Corporation Code of the Philippines:

(a) To enact rules and regulations not contrary to law as may be necessary to
carry out the purposes and functions of the LCU;

(b) To receive and appropriate all sums, as may be provided, for the support
of the university or college in the manner it may determine, and its discretion, to
carry out the purposes and functions of the LCU;

(c) To receive in kind and in trust legacies, gifts and donations of real and
personal properties of all kinds, to administer and dispose the same when necessary
for the benefit of university or college, subject to limitations, discretions and
instructions of the donors, if any. Such donations shall be exempt from all taxes and
shall be considered as deductible items from the income tax of the donor;

(d) To fix the tuition fees and other school charges, such as but not limited to
matriculation fees, graduation fees and laboratory fees, as the Board may deem
proper to impose after due consultations with the involved sectors; Provided, that
these fees will not be prohibitive or unreasonable as to deviate from the purpose for
which the LCUs are created

Such fees and charges, including government subsidies and other income
generated by the LCU, shall constitute a special trust fund and shall be deposited in
any authorized government depository bank, and all interests that shall accrue
therefrom shall form part of the same fund for the use of the LCU.

Any provision or existing laws, rules and regulations to the contrary
notwithstanding, any income generated by the LCU from tuition fees and other
charges, as well as from the operation of auxiliary services and land grants, shall be
retained by the LCU, and may be disbursed by the Board for instruction, research,
extension services, or other programs/projects of the LCU: Provided, that all
fiduciary fees shall be disbursed for the specific purpose for which they are
collected,

If, for reason of control, the university or college shall be able to pursue any
project for which funds have been appropriated and allocated under its approved
program of expenditures, the Board may authorize the use of said funds for any
reasonable purpose which, in its discretion, may be necessary and urgent for the
attainment of objectives and goals of the LCU;

(e) To adopt and implement a socialized scheme of tuition and school fees for
greater access to poor but deserving students;


(f) To authorize the construction or repair of its building, machineries,
equipment, and other facilities, as well as the purchase and acquisition of real
personal properties, including necessary supplies, materials, and equipment.
Purchase and other transactions entered into by the LCU through the Board shall be
exempt from all taxes and duties, subject to applicable BIR (Bureau of Internal
Revenue) rules and regulations;

(g) To appoint, upon the recommendation of the (president of the university or
college) search committee created by the Board, vice presidents, deans, directors,
heads of departments, faculty members and other officials and employees;

(h) To fix and adjust salaries of faculty members and administrative officials
and employees, subject to the provisions of the revised compensation laws
governing hours of service, and such other duties and conditions as it may deem
proper; to grant them, at its discretion, leaves of absence under such regulations as
it may promulgate, any provisions of existing law to the contrary notwithstanding;
and to remove for cause in accordance with the requirements of due process of law;

(i) To approve the curricula, and institutional programs of the institution:
Provided, That it conforms to the CHED guidelines;

() To approve rules of discipline for the administrative and academic staff of
the college or university to ensure orderly and effective governance thereof;

(k) is wy policies on admission and graduation of students: Provided, That it
fort IED guidelines;

(!) To award honorary degrees upon persons in recognition of outstanding
contribution in the field of education, public service, arts, science and technology or
any field of specialization within the academic competence of the university or
college and to authorize the certificates of completion of non-degree and non-
traditional courses; Provided that these conform with the applicable guidelines of the
CHED;

(m) To establish research and extension centers of the LCU where such will
promote the development of the latter;

(n) To establish chairs in the LCU and to provide fellowships for qualified
faculty members and scholarships to deserving students;

(0) To adopt a tuition scheme that shall prescribe a different rate of fees for
students who are residents of the area or LGU where the LCU is located and for
those who are non-residents;


(p) To delegate any of its power and duties for the hereinabove to the
president and/or the other officials of the LCU as it may deem appropriate so as to
expedite the administration of the affairs of the university or college;

(q) To authorize an external management audit of the institution, to be
coordinated with CHED, and to institute reforms, including academic and structural
changes, on the basis of the audit results and recommendations;

(1) To enter into joint ventures with business and industry for the profitable
development and management of the economic assets of the college or university,
the proceeds from which, shall be used for the development and strengthening of
the LCU;

(s) To develop consortia and other forms of linkages with the LGUs,
institutions and agencies, both public and private, local and foreign, in furtherance of
the purposes and objectives of the institutions;

(t) To develop academic arrangements for institution capability building with
appropriate institutions and agencies, public or private, local or foreign, and to
appoint experts/specialists as consultants, or visiting or exchange professors,
scholars, researchers, as the case may be;

(u) To set up the adoption of modern and innovative modes of transmitting
knowledge such as the use of information technology, the dual system, open
learning, community laboratory, etc., for the promotion of greater access to
education within the institution;

(v) To establish policy guidelines and procedures for participative decision
making and transparency within the institution;

(w)To privatize, where most advantageous to the institution, management of
non-academic services such as health, food, building or grounds or property
maintenance and similar such other objectives; and

(x) To extend the term of the president of the LCU beyond the age of
retirement, but not later than the age of seventy (70), whose performance has been
unanimously rated as outstanding, and upon unanimous recommendation by the
search committee for the president of the institution concerned.

Sec. 9. Administration of the LCU. The administration of the LCU shall be
vested in the President who shall render full-time service to implement policies
promulgated by the Board. He/She shall be appointed by the Board upon the
recommendation of a search committee duly constituted by the Board.


The President of the LCU shall have a term of five (5) years and shall be
eligible for reappointment for another term, unless otherwise provided for in the
ordinance creating the LCU

The President must have an appropriate earned (doctoral) Master's degree,
management expertise, and at least five (5) years of relevant administrative
experience, without prejudice to the provisions of additional qualifications to be set
by the governing board of the LCU.

In case of vacancy in the Office of the President by reason of death,
compulsory retirement, resignation, removal for cause or incapacity of the president
to perform the functions of his/her office, the Board shall have the authority to
designate an officer-in-charge of the LCU, within a period of six months to one year,
pending the appointment of a new President.

The powers and duties of the President of the LCU, in addition to those
specially provided in this Act, shall be those usually pertaining to the Office of the
President of other colleges, and those delegated by the Board. The salary of the
President of the LCU shall be set by the Board, taking into consideration the
applicable civil service rules and regulations and ensuring that the same be
comparable to that being received by the presidents of similar educational
institutions.

For the effective operation of the LCU, the vice-president, deans, directors,
heads of departments, faculty, non-teaching personnel and such other officials and
employees shall be appointed by the Board, taking into consideration the
recommendation of the President. The appointments of these LCU officials and
employees shall be in conformity to existing civil service laws, rules and regulations.

SEC. 10. Search Committee for President of the LCU. Six (6) months
before the expiration of the term of office of the incumbent President, the Board shall
appoint a Search Committee for President of the LCU. The Search Committee shall
conduct the search in accordance with the procedure and criteria established by the
CHED.

The Search Committee shall have five (5) members to be appointed by the
Board, The composition of the Search Committee shall include a representative from
the LGU concerned, the academe, the Association of Local Colleges and
Universities (ALCU), the faculty, and the business sector. They shall elect a
Chairperson and Vice-Chairperson from among themselves.

Sec. 11. The Administrative Council. An Administrative Council may be
created, which shall consist of the President of the LCU as Chairperson, vice
presidents, deans, directors and other officials of equal rank as members, whose
duty is to review and recommend to the Board policies governing the administration,
management and development planning of the LCU.


Sec. 12. The Academic Council. An Academic Council may be created,
which shall be composed of the President of the LCU, who shall act as Chairperson,
and all academic staff with the rank of at least an assistant professor, as members.

The Academic Council shall have the power to review and recommend the
curricular offerings and rules of discipline of the LCU, subject to the approval of the
Board. It shall fix the requirements for the admission of students, as well as for their
graduation and conferment of degrees, subject to review and approval by the Board
through the President of the LCU. It shall have the disciplinary power over students
of the LCU and shall formulate academic policies and rules and regulations on
discipline, subject to the approval of the Board.

SEC. 13. Academic Freedom. Pursuant to paragraph 2, Section 5 of Article
XIV of the constitution of the Republic of the Philippines, all institutions of higher
learning, public or private, shall enjoy academic freedom and institutional autonomy.

SEC. 14. Use of DepED Facilities. For the first ten (10) years from the
establishment of _a local college, DepED facilities such as elementary and_high
school classrooms, shall be made available to LCUs for their use.

SEC. 15. Appropriation for LCUs. There shall be a provision for the regular
annual appropriation from the LGU to support and sustain the operation of the LCU.

SEC. 16. Implementing Rules and Regulations. The CHED, in coordination
with the Department of the Interior Local Government (DILG) and the ALCU, shall
promulgate the implementing rules and regulations as may be necessary to carry out
the provisions of this Act within sixty (60) days from the effectivity of this Act.

SEC. 17. Separability Clause. If any provision of this Act shall be held
unconstitutional or invalid, the remaining provisions which are not affected thereby
shall continue to be in full force and effect.

SEC. 18. Repealing Clause. All laws, executive orders, decrees, instructions,
rules and regulations and other issuances, or parts thereof, contrary to or
inconsistent with this Act are hereby modified, amended or repealed accordingly

SEC. 19. Effectivity Clause. This Act shall take effect fifteen (15) days after
its publication in at least two (2) newspapers of general circulation

Approved,