AN ACT ENACTING A LOCAL GOVERNMENT CODE

• Number: Batas Pambansa Blg. 337
• Sections: 233

Section 1 Title of Act.

SECTION 1. Title of Act.—This Act shall be known and referred to as the "Local Government Code."

Section 2 Declaration of Policy.

SEC. 2. Declaration of Policy.—The State shall guarantee and promote the autonomy of local government units to ensure their fullest development as self-reliant communities and make them more effective partners in the pursuit of national development and social progress. To this end, the State shall constantly find and effectuate ways of enhancing their capabilities in discharging these responsibilities through a responsive and accountable local government structure instituted through a system of decentralization whereby local governments shall be given more powers, responsibilities and resources.

Section 3 Scope of Application of Code.

SEC. 3. Scope of Application of Code.—This Code shall apply to all local governments and, to the extent herein proved, to officials, offices or agencies of the national government.

Section 4 Rules of Interpretation.

SEC. 4. Rules of Interpretation.—(1) Any power of a barangay, municipality, city or province shall be liberally construed in its favor. Any fair and reasonable doubt as to the existence of the power shall be interpreted in favor of the local government unit concerned.

(2) The general welfare provisions in this Code shall be liberally interpreted so as to give more power to local governments in promoting the economic uplift, social welfare and material progress of the people in the community.

(3) Vested rights existing on the date of the effectivity of this Code arising out of contracts or any other source of obligation between a province, city, municipality or barangay and another party, shall be governed by the original terms and provisions of said contract or the law in force at the time such rights became vested and in no case shall this Code infringe on them.

(4) When in the resolution of controversies arising under this Code no legal provision or jurisprudence can be found to apply, resort may be had to the customs and traditions in the place where the controversy arose.

Section 5 Creation and Conversion; Political and Corporate Nature.

SEC. 5. Creation and Conversion; Political and Corporate Nature.— (1) As a general rule, the creation of a local government unit or its conversion from one level into another level of local government shall be based on factors relative to viability and projected capacity to provide services which can be clearly shown by verifiable indicators.

(2) Every local government unit created or recognized under this Code is a body politic and corporate endowed with powers to be exercised by and through its government in conformity with law. As such, it shall exercise powers as a subdivision of the government and as a corporate entity representing the inhabitants of its territory.

Section 6 Beginning of Corporate Existence.

SEC. 6. Beginning of Corporate Existence.—When a new local government unit is created, its corporate existence shall commence upon the qualification of its chief executive and a majority of the members of its legislative body or sanggunian unless some other time is fixed therefor by law.

Section 7 Governmental Powers in General.

SEC. 7. Governmental Powers in General.—Every local government unit shall exercise the powers expressly granted, those necessarily implied therefrom, as well as powers necessary and proper for governance such as to promote health and safety, enhance prosperity, improve morals, and maintain peace and order in the local government unit, and preserve the comfort and convenience of the inhabitants therein.

Section 8 Authority to Create Sources of Revenue.

SEC. 8. Authority to Create Sources of Revenue.—(1) Each local government unit shall have the power to create its own sources of revenue and to levy taxes, subject to such limitations as may be provided by law.

(2) For purposes of taxation by local government units, the appraisal and assessment of real property, as well as the levy, collection and administration of real property taxes, shall be governed by the provisions of existing laws insofar as they are not inconsistent with this Code.

Section 9 Eminent Domain.

SEC. 9. Eminent Domain.—A local government unit may, through its head and acting pursuant to a resolution of its sanggunian, exercise the right of eminent domain and institute condemnation proceedings for public use or purpose.

Section 10 Closure of Roads.

SEC. 10. Closure of Roads.—A local government unit may likewise, through its head acting pursuant to a resolution of its sangguniang and in accordance with existing law and the provisions of this Code, close any barangay, municipal, city or provincial road, street, alley, park or square. No such way or place or any part thereof shall be closed without indemnifying any person prejudiced thereby. A property thus withdrawn from public use may be used or conveyed for any purpose for which other real property belonging to the local unit concerned might be lawfully used or conveyed.

Section 11

SEC. 11. Effectivity of Ordinances; Publication — (1) No ordinance enacted by a local government shall take effect until after the lapse of ten (10) days from the date a copy of it is posted in a bulletin board located in a conspicuous place at the provincial, city, municipal or barangay hall, at the public market, and/or at the church or chapel.

(2) In highly urbanized cities, the main features of the ordinance must, in addition thereto, be published in a newspaper of general circulation in the city.

Section 12 Corporate Powers.

SEC. 12. Corporate Powers.— Every local government unit shall, as a corporation, have the following powers:

(1) To have continuous succession in its corporate name;

(2) To sue and be sued;

(3) To have and use a corporate seal;

(4) To acquire and convey real or personal property;

(5) To enter into contracts; and

(6) To exercise such other powers as are granted to corporations, subject to limitations provided in this Code and other laws.

Section 13 Non-Liability for Damages.

SEC. 13. Non-Liability for Damages.—Unless otherwise provided by law, no province, city, municipality or barangay shall be liable for injuries or damages to persons or property arising from the act or omission of any of its officers or employees while in the performance of their official functions.

Section 14 National Supervision over Local Governments.

SEC. 14. National Supervision over Local Governments. — (1) The President of the Philippines shall exercise general supervision over local governments to ensure that local affairs are administered according to law. General supervision includes the power to order an investigation of the conduct of local government officials whenever necessary. Such general supervision shall be exercised primarily through the Ministry of Local Government.

(2) All ministries and national offices having to do with local government administration shall be confined to the setting of uniform standards and guidelines to obviate the need for requiring prior approval or pre-clearance on regular and recurring transactions and other activities normal to local governments. In this regard, the Ministry of Local Government shall establish and maintain appropriate coordinative and consultative arrangements with other ministries and national offices concerned with respect to the monitoring and securing of proper compliance with such standards and guidelines specially on matters which are highly technical in nature. Moreover, as a matter of general policy and whenever appropriate, the Ministry of Local Government shall exercise its supervisory authority over municipalities through the provinces, and barangays through municipalities and cities.

(3) Where appropriate, ministries and national agencies with project implementation functions other than the Ministry of Local Government, shall coordinate with and secure the desired integration with allied national government functions.

(4) Unless the contrary is provided, the regional offices or appropriate field units of the various ministries and national agencies in the region shall be the major points of contact and liaison between local governments and the national government. For this purpose, the national government shall, as a general policy and as much as practicable, effect the substantial delegation of authority and powers to the regional offices.

Section 15 Provincial-City Relations.

SEC. 15. Provincial-City Relations.—The province, through the provincial governor, shall see to it that every component city within its territorial jurisdiction acts within the scope of its assigned powers and functions. Highly urbanized cities shall be independent of the province.

Section 16 Loans, Grants or Subsidies between Province and Component Cities.

SEC. 16. Loans, Grants or Subsidies between Province and Component Cities.— (1) The sangguniang panlalawigan may, out of the provincial funds, extend loans, grants or subsidies to component cities geographically located within the province under such terms and conditions as it may impose.

(2) The sangguniang panlungsod of a component city may, out of city funds, likewise extend loans, grants or subsidies to the province to which it belongs, subject to such terms and conditions as it may impose.

Section 17 Provincial Supervision over Municipal Affairs.

SEC. 17. Provincial Supervision over Municipal Affairs. —The province, through the provincial governor, shall have primary responsibility for general supervision over the government of every municipality within its territorial jurisdiction to ensure that it acts within the scope of its assigned powers and functions.

Section 18 Submission of Questions to the Provincial Attorney or Fiscal.

SEC. 18. Submission of Questions to the Provincial Attorney or Fiscal.—In the absence of a municipal attorney, the municipal government may secure the opinion of the provincial attorney, if any, or the provincial fiscal on any legal question affecting the municipality.

Section 19 Certain Acts of the Sangguniang Bayan Requiring Approval of the Sangguniang Panlalawigan.

SEC. 19. Certain Acts of the Sangguniang Bayan Requiring Approval of the Sangguniang Panlalawigan.—The following acts of the sangguniang bayan shall be subject to the approval of the sangguniang panlalawigan:

(1) Permanent closure of a public road, street, alley, park or square; and

(2) Donation of municipal funds or property.

Section 20 Provincial Loans, Grants and Subsidies.

SEC. 20. Provincial Loans, Grants and Subsidies.—The sangguniang panlalawigan may, out of the provincial funds, extend loans, grants and subsidies to municipalities of the province under such terms and conditions as it may impose.

Section 21 City Supervision over Barangay Affairs.

SEC. 21. City Supervision over Barangay Affairs.— The city, through the city mayor, shall have primary responsibility for general supervision over the government of every barangay within its territorial jurisdiction to ensure that it acts within the scope of its assigned powers and functions.

Section 22 Review of Barangay Ordinances and Resolutions.

SEC. 22. Review of Barangay Ordinances and Resolutions.—The Sangguniang panlunsod shall review all ordinances and resolutions duly approved by the sangguniang barangay to ensure that they are within the powers granted by law and in conformity with city ordinances.

Section 23 Barangay Improvement; Recommendations.

SEC. 23. Barangay Improvement; Recommendations.— The sangguniang barangay may submit to the sangguniang panlungsod such suggestions or recommendations as it may see fit for the improvement of the barangay and for the welfare of its inhabitants.

Section 24 Municipal Supervision over Barangay Affairs.

SEC. 24. Municipal Supervision over Barangay Affairs. — The municipality, through the municipal mayor, shall have primary responsibility for general supervision over the government of every barangay within its territorial jurisdiction to ensure that it acts within the scope of its assigned powers and functions.

Section 25 Review of Barangay Ordinances and Resolutions.

SEC. 25. Review of Barangay Ordinances and Resolutions.—The sangguniang bayan shall review all ordinances and resolutions duly approved by the sangguniang barangay to ensure that they are within the powers granted by law and in conformity with municipal ordinances.

Section 26 Recommendations to the Sangguniang Bayan.

SEC. 26. Recommendations to the Sangguniang Bayan. —The sangguniang barangay may submit to the sangguniang bayan such suggestions or recommendations as it may see fit for the improvement of the barangay and for the welfare of its inhabitants.

Section 27 The Ministry of Health.

SEC. 27. The Ministry of Health.— (1) The present participation of local government units as well as their fund assistance for the delivery of health services within their respective areas shall continue until such time as the national integration of said services shall have been fully implemented by the Ministry of Health.

(2) Notwithstanding this integration, a local government unit may assist or augment the integrated national health services with local funds.

Section 28 The Ministry of Justice.

SEC. 28. The Ministry of Justice.—Whenever the exigencies of the service warrant the creation of positions of additional lawyers to assist provincial and city fiscals in the discharge of their duties, positions of special counsel may be created by any province or city with salaries chargeable against provincial or city funds. Special counsels shall be appointed by the Minister of Justice upon recommendation of the provincial governor or city mayor concerned, either on permanent or temporary basis.

Section 29 The Commission on Audit.

SEC. 29. The Commission on Audit.—The Commission on Audit shall review and audit all accounts of each local government unit in accordance with the provisions of law relating to government accounts and accounting.

Section 30 The Ministry of Education, Culture and Sports.

SEC. 30. The Ministry of Education, Culture and Sports.— The Ministry of Education, Culture and Sports shall exercise the same jurisdiction and powers over all educational institutions established or supported by any local government unit that it exercises over all other public schools.

Section 31 Participation of Local Governments in the Implementation of National Programs and Projects.

SEC. 31. Participation of Local Governments in the Implementation of National Programs and Projects.—(1) Each ministry, office, agency or instrumentality of the national government shall involve local governments and secure their participation in the various substantive aspects of programs and projects, and the other corollary operational activities that should be carried out through local governments.

(2) As a general policy and as much as practicable, the national government shall encourage and provide the necessary authority for local governments in the supervision of appropriate national government operations and activities undertaken at the various levels of local government.

Section 32 Technical and Financial Assistance; Technical Supervision.

SEC. 32. Technical and Financial Assistance; Technical Supervision.— (1) Every ministry, office, agency or instrumentality of the national government shall render technical and provide financial assistance to local governments necessary to carry out national policies, plans, programs, projects and activities.

(2) Ministries may exercise technical supervision over local governments on technical aspects over which they are responsible on the national level.

Section 33 Transfer of Responsibility.

SEC. 33. Transfer of Responsibility.—As a general policy and where appropriate, the national government shall encourage and take the necessary measures for the transfer of responsibility and the corresponding authority over service delivery functions from the national to the local governments or from a higher to a lower level of local government: Provided, however, That such transfer need not be effected at the same time and for all the units in any tier of local government, but may be done on the basis of the capability of the local unit or units concerned to assume and discharge the transferred responsibility.

Section 34 Principles to be Observed.

SEC. 34. Principles to be Observed.—The following principles shall be observed by all concerned relative to the financial affairs, transactions and operations of every local government:

(1) As a general rule, local governments shall be allowed as much authority and flexibility over the financial aspects of their operations which are consistent with such standards and guidelines as may be prescribed by competent authorities.

(2) No money shall be paid out of the treasury except in pursuance of a lawful appropriation or other specific statutory authority. No funds shall be disbursed, and no checks shall be issued without the approval or signature of the local chief executive.

(3) Public funds and monies shall be spent solely for public purposes.

(4) Revenue shall be obtainable from all sources, including the power to levy taxes, subject to such limitations as may be provided by law.

(5) All monies officially received by a public officer shall be accounted for as government funds, except as may otherwise be specifically provided by law.

(6) Trust funds shall not be paid out of the treasury except in fulfillment of the purpose for which the trust was created or the funds received.

(7) Fiscal responsibility shall be shared by all those exercising authority over the financial affairs, transactions and operations of the local government unit concerned.

Section 35 Preparation, Approval and Review of Budget.

SEC. 35. Preparation, Approval and Review of Budget.— Budgets of local government units shall be prepared, approved and reviewed in conformity with the provisions of law, rules and regulations, taking into account such limitations as are imposed on appropriations for salaries and rates of compensation, personnel movement and administration, and appropriations for discretionary purposes of local executives.

Section 36 Accounting and Accountability.

SEC. 36. Accounting and Accountability.—(1) Every local government officer whose duties require the possession or custody of local government funds shall be accountable therefor and responsible for their safekeeping in conformity with the provisions of law. Local treasurers and other accountable officers shall render their accounts within such time, in such form, style and contents and under such regulations as the Commission on Audit may prescribe pursuant to law.

(2) The heads of local government units shall be responsible for the proper operation and maintenance of the accounting offices in their respective units. They shall see to it that all accounting records and books conform to the applicable provisions of this Code, and the pertinent laws, rules, regulations and reporting requirements of the Office of Budget and Management. Non-compliance with such laws, rules, regulations and reporting requirements shall be sufficient ground for administrative action against the officials responsible therefor, including dismissal from the service.

Sec- 37. Auditorial Inspection.—The books of accounts, papers and cash of any local treasurer or other accountable local official shall at all times be open to the inspection of the Commission on Audit or its duly authorized representative.

Section 38 Credit Financing for Local Governments.

SEC. 38. Credit Financing for Local Governments.—The conduct and management of the credit transactions and borrowings of local governments shall be governed by existing laws.

Section 39 Intergovernmental Fiscal Relations.

SEC. 39. Intergovernmental Fiscal Relations.—Inter-governmental sharing of funds between the national and local governments shall be governed by existing laws.

Section 40 Statement of Assets.

SEC. 40. Statement of Assets.—Before assuming office, an official or employee of a local government unit shall file in the-office of its chief official a sworn statement of assets, liabilities and property holdings.

Section 41 Officials not to Engage in Business Transactions or Possess Pecuniary Interest.

SEC. 41. Officials not to Engage in Business Transactions or Possess Pecuniary Interest.—It shall be unlawful for any local government official, directly or indirectly, individually or as a member of a firm:

(1) To engage in any business transaction with the local government unit of which he is an official or over which he has the power of supervision, or with any of its authorized officials, boards, agents, or attorneys, whereby money is to be paid, or property or any other thing of value is to be transferred, directly or indirectly, out of the resources of the local government unit to such person or firm;

(2) To purchase any real estate or other property forfeited in favor of such unit which shall be sold for unpaid taxes or assessment, or by virtue of legal process at the suit of said unit;

(3) To be surety for any person having contract or doing business with the local government unit for the performance of which surety may be required.

Section 42 Qualifications.

SEC. 42. Qualifications.— (1) An elective local official must be a citizen of the Philippines, at least twenty-three years of age on election day, a qualified voter registered as such in the barangay, municipality, city or province where he proposes to be elected, a resident therein for at least one year at the time of the filing of his certificate of candidacy, and able to read and write English, Pilipino, or any other local language or dialect.

(2) Candidates for the position of punong barangay or member of the sangguniang barangay must be actual residents in the barangay where they propose to be elected.

(3) A candidate for chairmanship of the kabataang barangay need not be of the minimum age required in this section.

Section 43 Manner of Election.

SEC. 43. Manner of Election.— (1) Unless otherwise provided by law, the governor, vice-governor, city mayor, city vice-mayor, municipal mayor, municipal vice-mayor, and barangay officials shall be elected at large in their respective units by the qualified voters therein. However, the kabataang barangay chairman for each barangay shall be elected by the registered voters of the kabataang barangay assembly as hereinafter provided.

(2) The members of the sangguniang panlalawigan, sangguniang panlungsod, and the sangguniang bayan shall be elected at large in their respective units, but the representatives of the katipunan ng mga barangay and the kabataang barangay federation in said sanggunians shall be elected by their own respective organizations, subject to the supervision of the Commission on Elections.

(3) Unless otherwise provided by law, the present manner of election/appointment of representatives of the agricultural and industrial labor sectors to the sangguniang panlungsod or sangguniang bayan, as the case may be, shall be maintained.

Section 44 Term of Office.

SEC. 44. Term of Office.—The term of office of all local elective officials shall be six (6) years, starting from the date provided by law.

Section 45 Change of Territory Affecting Tenure of Office.

SEC. 45. Change of Territory Affecting Tenure of Office.—When a part of a province, city, municipality, or barangay is detached from its mother unit to form a new local government unit, or is merged to an existing local government unit, any elective official of the mother unit residing in the detached or merged territory shall be entitled to continue to hold office in the mother province, city, municipality or barangay, as the case may be, and exercise the functions thereof for the remainder of his term.

Section 46 Supervision over Local Elections by the Commission on Elections.

SEC. 46. Supervision over Local Elections by the Commission on Elections.—The Commission on Elections shall, in addition to the powers and functions conferred upon it by the Constitution and other laws, have supervision over local elections and plebiscites with powers to promulgate the necessary rules and regulations consistent with the provisions of this Code.

Section 47 Commutation of Leave Credits.

SEC. 47. Commutation of Leave Credits.—All elective local government officials shall be entitled to whatever leave credits are granted to appointive officials under existing laws, and the commutation of the money, value thereof.

Section 48 Permanent Vacancy in the Office of the Governor, City or Municipal Mayor.

SEC. 48. Permanent Vacancy in the Office of the Governor, City or Municipal Mayor.— (1) In case a permanent vacancy arises when a governor, city or municipal mayor refuses to assume office, fails to qualify, dies or is removed from office, voluntarily resigns, or is otherwise permanently incapacitated to discharge the functions of his office, the vice-governor, city or municipal vice-mayor, as the case may be, shall assume the office for the unexpired term of the former.

(2) If the vice-governor, city or municipal vice-mayor, as the case may be, likewise refuses to assume office or fails to qualify, dies or is removed from office, voluntarily resigns, or is otherwise permanently incapacitated to discharge the functions of the office, the member of the sangguniang panlalawigan, sangguniang panlungsod or sangguniang bayan, as the case may be, who obtained the highest number of votes in the election immediately preceding shall assume the office for the unexpired term of the governor, city or municipal mayor concerned.

(3) If the sanggunian member concerned likewise refuses to assume office or fails to qualify, dies or is removed from office, voluntarily resigns, or is otherwise permanently incapacitated to discharge the functions of the office, the vacancy shall be filled by appointment of the President of the Philippines, upon recommendation of the Minister of Local Government, for the unexpired term of the vacant office.

Section 49 Permanent Vacancy in the Office of the Vice-Governor, City or Municipal Vice-Mayor.

SEC. 49. Permanent Vacancy in the Office of the Vice-Governor, City or Municipal Vice-Mayor.— (1) In case a permanent vacancy arises when a vice-governor, city or municipal vice-mayor assumes the office of governor, city or municipal mayor, as the case may be, or refuses to assume office, fails to qualify, dies, is removed from office, voluntarily resigns or is otherwise permanently incapacitated to discharge the functions of his office, the sangguniang panlalawigan, sangguniang panlungsod or sangguniang bayan member who obtained the highest number of votes in the election immediately preceding, as the case may be, shall assume the office for the unexpired term of the vice-governor, city or municipal vice-mayor concerned.

(2) If the sanggunian member concerned likewise assumes the office of governor, city or municipal mayor, as the case may be, or refuses to assume office, fails to qualify, dies or is removed from office, voluntarily resigns or is otherwise permanently incapacitated to discharge the functions of the office, the vacancy shall be filled by appointment of the President of the Philippines, upon recommendation of the Minister of Local Government, for the unexpired term of the vacant office.

Section 50 Permanent Vacancies in Local Sanggunians.

SEC. 50. Permanent Vacancies in Local Sanggunians.— In case of permanent vacancy in the sangguniang panlalawigan, sangguniang panlungsod, sangguniang bayan, or sangguniang barangay, the President of the Philippines, upon recommendation of the Minister of Local Government, shall appoint a qualified person to fill the vacancy in the sangguniang panlalawigan and the sangguniang panlungsod; the governor, in the case of sangguniang bayan members; or the city or municipal mayor, in the case of sangguniang barangay members. Except for the sangguniang barangay, the appointee shall come from the political party of the sanggunian member who caused the vacancy, and shall serve the unexpired term of the vacant office.

Section 51 Permanent Vacancy in the Office of Punong Barangay.

SEC. 51. Permanent Vacancy in the Office of Punong Barangay.— (1) In the event the punong barangay refuses to assume office, fails to qualify, dies or is removed from office, voluntarily resigns, or is otherwise permanently incapacitated to discharge the functions of his office, the member of the sangguniang barangay who obtained the highest number of votes in the election immediately preceding shall assume the office for the unexpired term of the punong barangay.

(2) If the sangguniang barangay member concerned likewise refuses to assume office, fails to qualify, dies or is removed from office, voluntarily resigns, or is otherwise permanently incapacitated to discharge the functions of his office, the vacancy shall be filled by the member of the sangguniang barangay who obtained the next highest number of votes in the election immediately preceding. The successor shall assume the office of punong barangay for the unexpired term of the vacant office.