Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City

18TH CONGRESS
First Regular Session

House Bill No: __1168

Introduced by Representatives Michael L. Romero and
Enrico A. Pineda

EXPLANATORY NOTE

It is imperative that the Local Government Units (LGUs) shall be charged with
the implementation of this Act in their respective localities, in coordination with
the Housing and Urban Development Coordinating Council (HUDCC), the
national housing agencies, the Presidential Commission for the Urban Poor
(PCUP), the private sector and other nongovernment organizations.

They shall prepare a comprehensive land use plan for their respective localities
in accordance with the provisions of this Act.

The Housing and Urban Development Coordinating Council shall, through the
key housing agencies, provide local government units with necessary support
such to formulate standards and guidelines as well as providing technical
support in the preparation of town and land use plans

In coordination with the National Economic and Development Authority (NEDA)
and the Philippine Statistics Authority (PSA), shall provide data and information
for forward-planning by the local government units in their areas, particularly
on projections as to the population and development trends in their localities
and the corresponding investment programs needed to provide appropriate types
and levels of infrastructure, utilities, services and land use patterns.

This House Bill seeks to assure, upon request of local government units, shall
provide technical and other forms of assistance in the implementation of their
respective urban development and housing programs with the objective of
augmenting and enhancing local government capabilities in the provision of



housing benefits to their constituents; and shall design an appropriate guarantee
scheme to encourage financial institutions to go into direct lending for housing,

MIC} ‘L L. ROMERO Ph.D. ENRICO 4. PINEDA


Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City

18TH CONGRESS
First Regular Session

House Bill No, 1168

Introduced by Representatives MICHAEL L. ROMERO and
ENRICO A. PINEDA

AN ACT

RATIONALIZING THE COMMUNITY MORTGAGE PROGRAM (CMP)
TO CREATE AN APPROPRIATE GUARANTY SCHEME, IMPROVE
THE EXTENT OF ITS AFFORDABILITY, PROVIDING FUNDS
THEREOF, INCREASING ITS PENALTIES AND SANCTIONS, AND
FOR OTHER PURPOSES,

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

SECTION 1. DECLARATION OF POLICY - the state shall hereby assist
legally organized associations of underprivileged and homeless citizens to

purchase and develop a tract of land under the concept of community ownership

The state shall 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


SECTION 2. PRIVILEGES — To encourage its wider implementation, the
participants in the Community Mortgage Program (CMP) shall be granted with

the following incentives:

(1) Government-owned or -controlled corporations
(GOCC) and Local Government units (LGUs), may dispose of
their idle lands suitable for socialized housing under the CMP
through negotiable sale at prices based on acquisition cost
plus financial carrying costs;

(2) Properties sold under the CMP shall be exempted
from the capital gains tax; and

(3) Beneficiaries under the CMP shall not be evicted nor
dispossessed of their lands or improvements unless they have
incurred arrangements in payments of amortizations for three
(3) months.

SECTION 3. BENEFICIARIES. — Beneficiaries of this Program shall be
responsible for their organization into associations to manage their subdivisions
or places of residence, to secure housing loans under existing Community
Mortgage Program and such other projects beneficiaries to them. Subject to such
rules and regulations to be promulgated by the National Home Mortgage Finance
Corporation (NHMFC), associations organized pursuant to this Act. may
collectively acquire and own lands covered by this Program.

Where the beneficiaries fail to form an association by and among
themselves, the National Home Mortgage Finance Corporation shall
initiate the organization of the same in coordination with the Presidential

Commission for the Urban Poor (PCUP) and the local government units
concerned.

No person who is not a bona fide resident of the area shall be a

member or officer of such association.


SECTION 4. IMPLEMENTING RULES AND REGULATIONS -~ The local
government units, in cooperation with the National Housing Authority (NHA),
Technology and Livelihood Resource Center (TLRC), and other concerned
agencies, shall promote the production and use of indigenous, alternative, and

low-cost construction materials and technologies for socialized housing.

The local government units shall coordinate with the Department of
Environment and Natural Resources (DENR) in taking measures that will
plan and regulate urban activities for the conservation and protection of
vital, unique and sensitive ecosystems, scenic landscapes, cultural sites

and other similar resource areas.

To make the implementation of this function more effective, the
active participation of the citizenry in environmental rehabilitation and in
decision making process shall be promoted and encouraged. The local
government units shall recommend to the Environmental and
Management Bureau (EMB-DENR) the immediate closure of factories,

mines and transport companies which are found to be causing mai
pollution.

ive

SECTION 5. MECHANICS - The local government units shall set up
an effective mechanism, together with the appropriate agencies like the
Population Commission, the National Economic and Development Authority
(NEDA) and the Philippine Statistics Authority (PSA), to monitor trends in the

movements of population from rural to urban, urban to urban, and urban to
rural areas.

They shall identify measures by which such movements can be
influenced to achieve balance between urban capabilities and population,
to direct appropriate segments of the population into areas where they can
have access to opportunities to improve their lives and to contribute to

national growth and recommend proposed legislation to Congress, if


necessary. The Population Commission, the National Economic and
Development Authority, and the Philippine Statistics Authority shall
likewise provided advanced planning information to national and local
government planners on population projections and the consequent level

of services needed in particular urban and urbanizable areas.

This service will include early-warning systems on expected
dysfunctions in a particular urban area due to population increases,

decreases, or age structure changes.

SECTION 6. APPROPRIATION - The State shall hereby provide an
additional authorize capitalization of Five hundred million pesos
(P500,000,000.00) to evolve and implement a comprehensive national program
to meet the housing and related needs of marginal and low-income families in
Metro Manila and other urban centers of the country. The state shall hereby
authorize the Housing and Urban Development Coordinating Council (HUDCC)
to re-align its appropriations, in the current year of the date of the effectivity of

this Act to conform with its mandate and requirements.

The amount necessary to carry out the purposes of this Act shall be
included in the annual budget of implementing agencies in the General
Appropriations Act (GAA) of the year following its enactment into law and every
year thereafter.

SECTION 7. FUNDING - Funds for the urban development and housing
program shall come from the following sources:

(1) A minimum of fifty percent (50%) from the annual net
income of the Public Estate Authority, to be used by the
National Housing Authority to carry out its programs of land
acquisition for resettlement purposes under this Act;


(2) Proceeds from the disposition of ill-gotten wealth, not
otherwise previously set aside for any other purpose, shall be
applied to the implementation of this Act shall be administered
by the National Home Mortgage Finance Corporation;

(3) Loans, grants, bequests and donations, whether from
local or foreign sources;

(4) Flotation of bonds, subject to the guidelines to be set
by the Monetary Board;

(5) Proceeds from the social housing tax and, subject to
the concurrence of the local government units concerned, idle
lands tax as provided in Section 236 of the Local Government
Code of 1991 and other existing laws;

(6) Proceeds from the date or disposition of alienable
public lands in urban areas; and

(7) Domestic and foreign investment or financing through

appropriate arrangements like the build-operate-and-transfer
scheme.

The amount of Five hundred million pesos (P500,000,000.00) as may be
necessary to carry out the provisions of this Act shall be included in the General

Appropriations Act of the year following its enactment into law.

SECTION 8. PENALTIES — Any person who violates any provision of this
Act shall be imposed the penalty of not more than six (6) years of imprisonment
ora fine of not less than Fifty thousand pesos (P50,000) but not more than One
hundred fifty thousand pesos (P150,000), or both, at the discretion of the court

Provided, That, if the offender is a corporation, partnership, association or
other juridical entity, the penalty shall be imposed on the officer or officers of

said corporation, partnership, association or juridical entity who caused the
violation.

SECTION 9. ANNUAL REPORTS - The Housing and Urban Development

Coordinating Council (HUDCC) shall hereby submit periodic reports on its


findings and make recommendations on actions to be taken by Congress and

Senate and the appropriate department.

SECTION 10. AUTOMATIC REVIEW - Every year after the effectivity of

this Act, an independent review panel composed of experts to be appointed by

the President shall review the po! s and programs in the HUDCC-NHA and
shall make recommendations, based on its findings, to the President and to both

Houses of Congress.

SECTION 11. SEPARABILITY CLAUSE - If any provision or section of
this Act or the application thereof to any person or circumstances is held invalid,
the other provisions or sections of this Act shall remain valid, and the application

of such remaining provisions or sections to the other persons or circumstances,
shall not be affected thereby.

SECTION 12. REPEALING CLAUSE - All provisions and any other

provisions inconsistent with the provision of this Act are hereby amended
accordingly.

SECTION 13. EFFECTIVITY CLAUSE - This Act shall take effect fifteen

(15) days from the date of its publication in the Official Gazette or in at least two
(2) newspapers of general circulation.

Approved.