Republic of the Philippines Department of the Interior and Local Government Regional Office IV-A CALABARZON. MEMORANDUM To : ALL PROVINCIAL/HUC DIRECTORS, SUBJECT : REVISED POLICY GUIDELINES ON MOTOR VEHICLE PURCHASE/ACQUISITION, USE, AND RENTAL BY THE LOCAL GOVERNMENT UNITS DATE : SEPTEMBER 5, 2022 This refers to the attached DILG Memorandum Circular No. 2022-105 dated August 23, 2022, relative to the abovecited subject. Said Memorandum Circular was issued in furtherance of Presidential Administrative Order No. 14, s. 2018 and DBM Budget Circular No. 2022-1 Relative to this, you are hereby enjoined to cause the widest dissemination of the attached issuance to all DILG Field Officers, local government units and others concerned within your areas of responsibility. For information and compliance. Ae RIEL O. IGLESI 1A, CESO Ill Regional Director. DMS: 2022-08-24-001 Site GALARARZON “Matino, Mahusay at Maaasahan” ‘IF Andenson Bldg. 1, National Hghway, Brgy. Parian, City of Calamba, Laguna 4027 ‘ (02) 8876-2454 Loe. 7401 to 7440, 7420, 7430, 7440 Sdigsa calabarzon@gmailcom Myvew calabarzon dig gov phNT OF gett OF Py, OFFICIAL 3 4, 3 g RELEASED @ DEPARTMENT OF THE INTERIOR AND LOCAL GOVERNMENT - DILG-NAPOLCOM Center, EDSA corer Quezon Avenue, Quezon City“... an www.dila.gov.ph — MEMORANDUM CIRCULAR No. 2022- 105 To : ALL PROVINCIAL GOVERNORS, CITY AND MUNICIPAL MAYORS, PUNONG BARANGAYS, SANGGUNIAN MEMBERS, THE BARMM CHIEF MINISTER, THE BARMM MINISTER OF LOCAL GOVERNMENT, DILG REGIONAL DIRECTORS, AND OTHERS CONCERNED SUBJECT : REVISED POLICY GUIDELINES ON MOTOR VEHICLE PURCHASE/ACQUISITION, USE, AND RENTAL BY THE LOCAL GOVERNMENT UNITS. 1G) HE DATE : AUG 23, 2022 ORE Background 4.1 Presidential Administrative Order No. 14, issued on December 10, 2018, entitled, “Consolidating and Rationalizing the Rules on the Acquisition of Government Motor Vehicles, Adopting a Centralized System of Procurement Therefor, and For Other Purposes’ states that the National Government adopts a policy of procuring, in the most efficient and economic manner, motor vehicles that are cost-effective, fuel-efficient, and environment-friendly, and at par with improvements and developments in the automotive industry and relevant technology. 4.2 Department of the Interior and Local Government (DILG) Memorandum Circular 2021-004 dated January 18, 2021, with the subject “Revised Guidelines on Motor Vehicle Acquisition by Local Government Units’, provides emphasis on the streamlining and delegation of authorization of the Secretary of the Department of the Interior and Local Government. 4.3. Kagawaran ng Interyor at Pamahalaang Lokal Memorandum Sirkular 2021-102, dated September 10, 2021, with the subject "Pagbabago sa lang Alituntunin na Nakapaloob sa DILG Memorandum Sirkular Big. 2021-004 na may paksang Revised Guidelines on Motor Vehicle Acquisition by Local Government Units” provides additional guidance on the use of 20% Development Fund and the Quality Management System. “Mating, Mahusay at Maasahan” “Trunkline No.: 8876-34-542.0 3.0 1.4 Department of Budget Management Budget (DBM) Circular No. 2022- 1 dated February 11, 2022, with the subject “Omnibus Guidelines on the Acquisition, Use, Rental and a Replacement of Goverment Motor Vehicles” provides guidance on (1) Allowable engine displacements of motor vehicles that may be purchased by government agencies; (2) Approving authorities for the acquisition of government motor vehicles: and (3) modes of acquisition.” Purpose 24 This Memorandum Circular is issued in furtherance of Presidential Administrative Order No. 14 s. 2018 and DBM Budget Circular No. 2022- 1 ScopelCoverage 3.1 These guidelines shall cover LGU purchase/acquisition, use, and rental of motor vehicles. 3.2 Pursuant to 4.2 of BC 2022-1, an official who is authorized to use an official transport vehicle shall be allowed only (1) motor vehicle. 3.3 Pursuant to Item 4.4 of DBM BC No. 2022-1, the following positions are allowed to be assigned with motor vehicles for their transportation services, subject to the financial capability of the procuring LGU: Position Title Salary Grade Provincial Government Provincial Governor 30 Provincial Vice-Governor 28 Sanggunian Panlalawigan Member 27 Provincial Government Department Head 26 City Government City Mayor 30 City Vice Mayor I/II 26/28 City Government Department Head I/ Il II 25/26/27 City Government Head 26 Sanggunian Panlungsod Member 25/27 Municipal Government Municipal Mayor I/!! 27/28 Municipal Vice-Mayor I/II 25126 Municipal Government Department Head VII 24/25 Sangguniang Bayan Member I/II 24/25 DBM BC No. 2022-1 particularly Item 4.5 thereof further states that other personnel of the department, agencies, and other government entities concerned who are not authorized to use government vehicles as abovementioned are entitled to the Page 201 13,40 common use of motor vehicles in the exercise of their core functions as may be prescribed under Annex A (updated Motor vehicles description, classifications, and ‘specifications Guide) of this Circular. Priority shall be given to personnel who are not entitled to a Transportation allowance Definition of Terms 4.1 Department - shall refer to the Department of the Interior and Local Government 42 Luxury Vehicle - refers to any motor vehicle with the following ‘specifications: Type of Luxury Vehicle Specification Car (sedan or hatchback) With an engine displacement exceeding 2500cc, if gasoline-fed; or 3500cc, if diesel-fed; and/or with an engine exceeding four (4) cylinders Passenger van or pick-up type With an engine displacement vehicle exceeding 2500cc, if gasoline-fed; or 3000ce, if diesel-fed; and/or with an engine exceeding four (4) cylinders Multi-Purpose Vehicle (MPV) and With an engine displacement van [formerly Asian/Crossover | exceeding 2500cc, if gasoline-fed; or Utility Vehicle (AUV/CUV) and | 2800cc, if diesel-fed; and/or with an MPV] engine exceeding four (4) cylinders Sports Utility Vehicle (SUV) With an engine displacement exceeding 2700ce, if gasoline-fed; or 3000cc, if diesel-fed; and/or with an engine exceeding four (4) cylinders 4.3 Motor Vehicle — for purposes of these guidelines, motor vehicles shall refer to: 4.3.1 Any self-propelled, four (4)-wheeled road vehicle, including, but not limited to, sedans, coupes, station wagons, convertibles, pick- ups, vans, Page 3.0! 13, assembled owner- or —_passenger-type4.3.2 43.3 43.4 43.5 4.3.6 4.3.7 jeepsiitneys/jeepneys, sports utility vehicles (SUV), Asian utility vehicles (AUV), crossover utility vehicles (CUVs), multi-cabs, and multi-purpose vehicles (MPVs); Motorcycles; Delivery trucks, fire trucks, dump trucks, and buses; Heavy equipment, such as bulldozers, payloaders, graders, forklifts, amphibian trucks, and cranes; All-terrain vehicles, armoured vehicles, and specific-purpose vehicles; Aircraft; and Motorized bancas, motorized boats, and sea-craft, as may be defined in relevant laws and issuances. 5.0 Policy Content and Guidelines 51 General Guidelines 5.14 5.12 5.1.3 5.1.4 5.1.5 5.1.6 All LGUs are prohibited from acquiring and/or using luxury vehicles, as defined under Item 4.2 of these guidelines, for their operations. LGUs are encouraged to dedicate a percentage of their vehicular requirements to the purchase of motor vehicles using alternative fuel types, such as bio fuels, fexi-fuel, natural gas, and solar and electric powered, subject to the limitations prescribed under this Memorandum Circular, and taking into considerations the sustainability of fuel or power supply in the area of operation. Al LGUs with the proposed acquisition of motor vehicles that are not under the approving authority of the Local Chief Executive must seek prior approval from the Secretary of Budget and Management, the Office of the President, or the Secretary of the Interior and Local Government, on specific motor vehicles as may be authorized pursuant to Item 5.5 hereof. In compliance to Section 18 of Republic Act No. 9184 (Government Procurement Act), all motor vehicles intended to be purchased shall not contain a brand name; Strict compliance with budgetary, procurement and auditing laws, regulations and standards shall be observed; and The LGUs, within thirty (30) days from the completion of the procurement process, shall submit a written report on the Page 40f 13,acquisition to the concerned DILG Office that issued the authority. The written report shall contain details regarding the type, brand, engine displacement, quantity, price, and seller of the purchased vehicle. A copy of the documentary requirements submitted to support the acquisition shall also be attached to the written report. 5.1.7. Allconcerned are reminded of the policy that No Post-Purchase Authority shall, or could be issued by this Department under any circumstances. 5.2 Modes of Acquisition In reference to item 8.0 of DBM BC 2022-1, motor vehicles shall be acquired through any of the following modes: a. Outright purchase, which involves procurement of brand-new units that are paid for on a single, lump-sum basis; b. Assembly (usually owner-or passenger type jeepneys), which is subject to the approval by the Secretary of Budget and Management, and may be resorted only under the following circumstances: Where brand new vehicles are not available in the locality, or if available, the cost is prohibitive because of the distance from the nearest market source; or ii, Where an assembled vehicle is deemed more durable as the design and type of parts used are made suitable to the road condition/terrain in the locality such as in remote barangays/municipalities; and iii. In any case, shall not use surplus/reconditioned engines. 5.3 Acquisition of secondhand/ reconditioned motor vehicles Cognizant of Section 9.1 of DBM BC 2022-1, the acquisition of all secondhand/ reconditioned motor vehicles except for aircraft, and sea craft, regardless of the source of fund and approving authority, shall be prohibited. The acquisition of secondhand aircraft, and sea craft shall follow Section 5.5.3.1 of these guidelines. 5.4 Sources of Funds for the Acquisition of Motor Vehicles. 5.4.1 Funds for motor vehicle purchases may be sourced from the following: 5.4.1.1 Unencumbered local funds that are free from obligation or not yet obligated, but are intended for a specific purpose, which may include unobligated loan proceeds Page 50! 13,in the local treasury taken-up in the books of the LGU as trust fund, for the fulfillment of an obligation or purposes in which the loan was contracted and approved. Other local unencumbered funds, include, but are not limited, to the following: 5.4.1.4.4 SANZ 5.4.1.1.3 5.4.1.1.4 5.4.1.1.5 5.4.1.1.6 Local Disaster Risk and Reduction Management Fund provided, that it shall be utilized in the acquisition of motor vehicles and heavy equipment to be exclusively used for response and rescuerrelief activities in its ‘Annual or Supplemental Budget or LDRRM Plan, and supported by a current Sanggunian Resolution on the utilization of unexpended fund balances in previous years; Portion of the twenty percent (20%) generated from the collection of building permit fees and other charges under the National Building Code (Presidential Decree No. 1096), pursuant to DPWH-DILG Joint Memorandum Circular No. 001, dated July 4, 2013; Portion of the twenty percent (20%) LGU share generated from the collection of fire permits pursuant to the Fire Code Revenues under the DOF-DBM-DILG Joint Circular No. 2015-01 dated February 12, 2015; Cash awards and prizes from award-giving national government agencies or government-controlled corporations, among others, exceptif there is an intended purpose of such prize as a condition thereof by the awarding body; Loan proceeds from lending institutions, provided that the terms and conditions must be specified in the loan agreement entered lo by and between the LGU and the lending institution, and is supported by a Sanggunian Resolution authorizing the utilization of loan proceeds to purchase motor vehicles; Per Family Payment Rate (PFPR) or PhilHealth Capitation Trust Fund, supported by a local Ordinance or Resolution Page 6 ol 135.5 (PhilHealth Circular No. 010 dated March 14, 2012); 5.4.4 .7 Donations from private entities forming part ‘of the LGU's local funds, supported by 2 Sanggunian Resolution authorizing the utilization of donations to purchase motor vehicles; and, 5.4.1.1.8 Portion of funds from the Energy Regulations No. 1-94 (ER 1-94), supported by the Annual Work Program indicating the project title, and fund source amount, and is supported by a Sanggunian Resolution authorizing the Utilization of such fund to purchase motor vehicles, 5.4.1.2 National government funds under the General Appropriations Act (GAA), such as Local Government Support Fund-Other Financial Assistance to LGUs, among others, specifically on the requests for purchase of multicabs and MPVs shall be limited to the specifications prescribed under Annex A (Updated Motor Vehicle Description, Classifications, and Specifications Guide) of DBM BC No. 2022-1. 5.4.2 A portion of the twenty percent (20%) of the National Tax Allotment Share for Development Projects, may be utilized in the acquisition of motor vehicles, except, however, for the purchase ‘of motor vehicles used for administrative purposes pursuant to Item 3.2.5.6, of DBM-DOF-DILG JMC No. 1 issued on November 4, 2020, Likewise, in purchasing motor vehicles with the use of the 20% Development Fund (DF), all LGUs are enjoined to adhere to the policies. and guidelines prescribed under Item 3.0, General Guidelines, of the aforementioned DBM-DOF-DILG JMC. Approving Authorities by Fund Source(s). 5.5.1. National Government Funds under the GAA 5.5.1.1 The Secretary of Budget and Management for the acquisition of motor vehicles, and heavy equipment, as defined under Section 6 of DBM BC No. 2022-1 5.5.1.2 The DBM shall, likewise, be the authority to decide on specific cases not falling within the express authority of the LGU or the DILG to approve. Page Tot 135.5.2 Local funds 5.5.2.1 Local Chief Executives (i.c., Provincial Governors, City Mayors, Municipal Mayors, and Punong Barangays) for the acquisition of the following motor vehicles and heavy equipment, based on the specification limitations set forth in Presidential Administrative Order No. 14 and DBM BC No. 2022-1, respectively; 5.5.2.1.1 Specific-purpose vehicles, such as, medical ambulances, military and police patrol vehicles, armored vehicles, prisoner's vans, and fire trucks; 5.5.2.1.2 Heavy equipment such as, road construction equipment, cargo transport equipment, farm machinery, waste management or environmental sanitation equipment, and other similar vehicles/equipment; 5.5.2.1.3 Locally-assembled owner- or passenger- type jeep, §.5.2.1.4 Motorized banca andor motorized boats; 5.5.2.1.5 Vehicles for mass transport when necessary, in the interest of public service; and 5.5.2.1.6 Motorcycles and tri-wheel vehicles. 5.5.3 Regardless of Fund Source 5.5.3.1 5.5.3.2 The Office of the President for the acquisition of all types of aircraft, and sea-crafts, upon the favorable endorsement of the Department of Budget and Management; The Secretary of the Interior and Local Government (SILG) or his duly authorized representative for the acquisition of cars, MPVs, vans, passenger vans, SUVs, pick-up type vehicles, and 4-wheel all-terrain Vehicle not falling under the authority of any other office or person under Item 5 of these guidelines, and/or as may be qualified by the following provisions: 5.53.21 That the vehicle to be purchased is not a luxury vehicle as defined under these guidelines; Page Bol 135.5.3.3 5.5.3.4 5.5.3.2.2 That the acquisition of SUVs shall be strictly in accordance with the provisions under Annex A, Updated Motor Vehicle Description, Classification, and Specifications Guide, of DBM BC No. 2022- 1, Delegated Authority of Concerned DILG Regional Directors. The authority of the SILG under item 5.5.3.2 is hereby delegated to the Department's Regional Directors with regard to requests coming from component cities, municipalities, and barangays within their respective areas of jurisdiction. The concemed office of the Department shall, upon review of the LGU request, and upon the determination that the same does not fall under the authority of the Department, endorse the same to the appropriate national government agency or its regional office for their appropriate action or return the request to the LGU if it falls within its authority. 5.6 Documentary and Procedural Requirements for the Issuance of Authority to Purchase Motor Vehicles 5.6.1. Prior to the issuance of authority to purchase motor vehicles, the following documents, in original and/or certified true copy, shall be submitted to the concemed DILG Municipal/City/Provincial Field Office: 5.6.1.1 5.6.1.2 5.6.1.3 Local Chief Executive (LCE) letter request stating the number and specific type of vehicle to be purchased, including specifications (i.e., engine displacement, fuel use as to gasoline- or diesel-fed, and number of cylinders), the purpose and deployment for which such vehicle(s) will be used, and official email address where the approved Department Authority may be sent, upon approval: Certification of Availability of Funds by the Local Accountant or the Head of the Accounting Unit, or in his: absence, the Local Treasurer or Budget Officer, issued within 6 months upon request of vehicle. Certified true copy of an Ordinance approving such purchase (ie., first two and last pages of the said Ordinance and the page indicating the appropriated amount, per vehicle, to be purchased, and reflecting the name of office the budget was appropriated), and current Sanggunian Resolution on fund utilization in Page 901 135.6.2 5.6.1.4 5.6.1.5 5.6.1.6 5.6.1.7 case of trust funds such as, unexpended DRRM fund balances from the previous year(s), and funds transferred/donated to the requesting-LGU from higher-level LGUs, government corporations, et In cases of LGU requests utilizing loan proceeds as the funding source, a certified true copy of the loan agreement between the LGU, and the lending institution, supported by an appropriate sanggunian resolution; and Updated (current calendar year) inventory/accounting of all existing motor vehicles showing their status/conditions/worthiness (e.g... good, fair, repairable or unserviceable) duly certified by the LGU's Property/Supply Officer! Accountable officer. Provided that the same shall not be required if the requesting LGU has already submitted a copy of the same to the concemed DILG office; Accomplished Citizen's Charter Service Request Form (with Document Code number FM-SP-DILG-07-01 effectivity date June 15, 2021); In addition to the administrative requirements prescribed above, the following documents shall also be submitted when utilizing the 20% Development Fund 5.6.1.7.1 Certified true copy of the duly approved local development plans and Annual Investment Program (AIP) or Local Development Investment Program — (LDIP)/Provincial Development Investment Program (PDIP) for the year (including the page indicating the project/purchase); and 5.6.1.7.2 Certification signed by the concerned LCE that the proposed motor vehicle to be purchased shall not be used for administrative purposes. ‘All Regional Directors shall review the submitted documents based on the provisions of these guidelines, as to substance, in order to determine 5.6.2.1 Whether or not the requested purchase needs the authority of the Department; and Page 10 0f 135.6.2.2 If Department authorization is required, the completeness, and adequacy of the submitted documentary requirements. 5.6.3 Alter receipt of the LGU request, the concemed DILG Regional Office shall assess the same, and, within seven (7) working days, notify the LGU if the nature of the request does not need authorization from the Department or if the same lack any documentary requirement; or Approve the request if it complies with all the requirements of these guidelines, and falls within the delegated authority of the regional director under Section 5.5.3.3. 5.6.4 Within three (3) working days after ensuring that all requirements as set forth under these guidelines are complied with, endorse the same to the DILG Central Office, through the Bureau of Local Government Supervision (BLGS), if the requesting LGU is a province, highly urbanized city, or an independent component city. 5.6.5 Direct submissions of requests for authority to purchase, to the Central Office, is highly discouraged. In the event that the LGU submits it directly, the BLGS shall, without making any preliminary assessment on the same, endorse to the concerned regional Office for their appropriate action. In addition, the LGU shall lose the benefit of the hasty disposition of requests as provided for under item 5.6.3 of these guidelines. 5.6.6 Requests endorsed by the DILG Regional Offices to the Central Office that do not comply with the preceding sections of these guidofines shall automatically be disapproved and relumed jo them. The regional office concemed shall be accountable for any dolays that this shall cause to the processing of the LGU request ‘and shall assume full accountability for any, and all complaints filed relative to the same. The disapproval shall be without prejudice to the proper refiling of the same. 5.6.7. Authorization from the SILG or his duly authorized representative, of requests of provinces, HUCs, and ICCs with complete Gocumentation shall be released by the Department's Central Records Section to the concemed Regional Office through CRS- DMS or via Philpost, if a hardcopy is available. 6.0 Rental of Motor Vehicles DBM BC 2022-1 particularly tem 10.0 states that rental of vehicles shall be resorted to only if the said mode is deemed more ‘economical, expedient and convenient than outright purchase, such as but not limited to7.0 8.0 Where the motor vehicle will be used in the performance of agency functions that are temporary or ad hoc in nature which require transportation services for agency personnel, and official guests/visitors; Where the motor vehicle will be used in conventions, seminars, athletic/sports events and similar gatherings wherein the nature of the gathering requires the travel or transport of participants, whether agency personnel or official guests/visitors, from one location to another; Where the motor vehicle will be used by a Presidential ad hoc body/agency mandated to perform a specific task; and Where the motor vehicle will be used in urgent and/or emergency cases such as in search and rescue operations during natural or man-made disasters and calamities. 6.1 Local Chief Executives, including Punong Barangays, are authorized to approve the requests for rental of motor vehicles of their respective LGUs regardless of the number of days of the rental if the budgetary source thereof is the LGU’s local funds, and said mode is deemed more ‘economical, expedient and convenient that outright purchase. Costing Parameters for acquisition or rental 7.4 The cost of motor vehicles to be purchases or rented shall be based on the type and specifications approved for the purpose as contained in the Authority to Purchase Motor Vehicle. 7.2. The purchase of rental of the motor vehicles shall be subject to pertinent procurement, budgeting, accounting and auditing laws, rules and regulations. Monitoring and Evaluation 8.1. DILG Regional Offices are directed to submit to the Central Office, every quarter, a report on all instances of violations of LGUs within thelr areas of jurisdiction, relative to the purchase of motor vehicles. ‘Subsequently, the regional offices are directed to submit a monthly summary of all requests processed by their office, the status of such requests, and the compliance of LGUs with the submission of reports under these guidelines, as prescribed in the Quality Management System Operating Procedure Manual QP-DILG-BLGS-RO-02. 8.2. The Bureau of Local Government Supervision, shall submit a quarterly report to the Secretary of all requests processed by the Department, and all recorded violations of LGUs. Page 1201139.0 10.0 11.0 12.0 13.0 14.0 Sanctions 9.1 Violations of any of the provisions of these guidelines may be used as the basis by the Department or any persons concerned in the filing of appropriate cases against erring officials, and personnel subject to existing laws, rules, and regulations. Dissemination All DILG Regional Directors and the BARMM Minister of Local Government are hereby directed to cause the widest dissemination of this Memorandum Circular within their respective areas of jurisdiction. Effectivity 14.1. This Memorandum Circular shall take effect immediately. Repealing Clause 42.1 DILG Memorandum Circular Nos. 2021-004 and 2021-102 dated January 18, 2021 and September 10, 2021, respectively, are hereby expressly repealed. All other DILG memorandum circulars, guidelines or any part thereof which may be inconsistent with this policy are hereby rescinded or modified accordingly. Feedback 13.1. For related queries, kindly contact the DILG Bureau of Local Government Supervision at Tel Nos. (02) 8876-3454 loc. 4204 or 4205, or at email address at blgs.apmv@gmail.com Approving Authority Secretary ATTY. aeruniy, ABALOS, JR. / BLGS-2022.07.04-039 BLGSIRADIOLPISDCIKPLmkc Page 130! 13,