League of cities approves resolution on loans, collections

THE League of Cities of the Philippines, which held its 50th Executive Board meeting in Bacolod City last October 19-21, passed several resolutions that concern the local government units in the country.

PCL president and San Fernando Mayor Oscar Rodriguez said among the resolutions passed include the implementation of a new law with respect to the problem of the LGU on the Office of the Building Official (OBO) where they believe that there should be a 100 percent retention of the collection.

He said that under Presidential Decree 1906 and its Implementing Rules and Regulations, “we are obligated to remit 20 percent of the collection to the national treasury.”

The retention of the LGU should be 100 percent of its collection. So there seems to be a contradiction, and so they passed a resolution on Sunday.

Regarding the loans, if they will obtain a loan either from local or international lending institutions with respect to their projects and programs, there must be a corresponding monitoring board opinion before they can be allowed to obtain a loan and this has caused unnecessary delays.

It is a very stringent restriction on the part of the LGU to confront and, at the same time, sped up the process of answering the problem in our areas so our position is that we must revisit, either put a cap or a specific period for the monetary board to give an opinion or remove this requirement if the loan is with respect to a local infrastructure project.

Anyway, there is an assurance through the Internal Revenue Allotment by way of a guarantee, he said.

With regard the status of taxation, it is their contention that the payment of taxes should be made in the LGU where the investor company is operating or having a factory or obtaining its income.

"What happens is that the income is in the local but the taxes are in the national, which is unfair because what is being used are local facilities," he said.

There are three things they have agreed upon insofar as the new 16 cities that they have only accepted five cities that are qualified.

They will pass this in our general assembly in December.

"I think by December everything will be clear. There might be no motion for reconsideration on the part of the LCP. Therefore, it might be timely for us to already address the problem and decide whether or not to accept the membership of the 16 cities into the LCP. None from the 16 cities were accepted yet. Only Mabalacd, Mabuyaw, Ilagan and two more, which are qualified," he said.

There was a violation of the Constitution when the 16 were converted into cities. They failed to obtain the area, income and population requirements.

The Constitution requires that the conversion must be in accordance with the provisions of the Local Government Code.

Under the LGC as amended, the conversion of municipalities into cities requires that they must have an area of at least 10,000 and population and collection of so much. (CNC)