REPUBLIC OF THE PHILIPPINES

D DEPARTMENT OF THE INTERIORAND IOCAL GOVERNMENT

rdFrancisco Gold Condominium ll, EDSA Cor., Mapagnahal St,
Diliman, Quezon City

iloruaqr O 812
T{EMORANDUM CIRCULAR
No.2U7- 03
ALL DILG REGIONAL DIRECTORS, CONCERNED PROVINGIAL
GOVERNORS. CITY AND MUNICIPAL MAYORS, AND ALL
OTHERS CONCERNED

SUBJECT SUPPLEMENTAL GUIDELINES TO FAST TRACK THE

RELEASE OF GAWAO PAMANA NG LAHI FINANCIAL
SUBSIDY TO RECIPIENT LOCAL GOVERNMENT UNITS

!n line with the govemment's campaign to encourage nationaFlocal govemments

convergence of effort towards the advancemeni of people's welfare, imorovement in th€
economy, and preservation of environmental integrity; and in recognition of the
contribution of the local govemments in the attainment of lhese goals, the Department
initiated the Gawad Pamana ng Lahi - an award for exemplary performance of local
govemment units (LGUs)

During the LG Code 20th Anniversary Celebration on Oclober 12,2011, the

Department confened 16 provinces, 16 cities and 17 municipalities with the Gawad
Pamana ng Lahi award with conesponding financial subsidy of P3M for each province,
P2M for each city and PI M for each municipality to further support the implementation of
local development initiatives aligned with national government priority programs.

In order to fast track the release of the Gawad Pamana ng Lahi financial subsidy
to recipient LGUs, the following guidelines are hereby issued:

Release of Gawad Pamana ng Lahi Financial Subsidy:

1. The Gawad Pamana ng Lahi financial subsidy shall be immediately released to

recipient LGUs upon forging of the Memorandum of Agreement (MOA) between
the recipient LGUS and the DILG thru the concemed DILG Regional Oftice.

2. The MOA shall indicate the project where the Gawad subsidiy shall be utilized. lt
shall include the projeci location, total projec{ cost, target beneficiaries, date of
start of projeci and expected dale of completion' The p@ec{ proposal shall be
submitted by the LGU recipient within fiffeen (15) days afier receipt of the check.

3. Eligible projecls which may be supported by the tinancial subsidy are those
supporlive of the following national thrust and priorities:

a. Achievement of the Millennium Development Goals (MDGs),

 b. Core road maintenance that will boost tourism and local economic
development, and
c. Compliance to Disaster Risk Reduction and Management Act of 2010.
known as Republic Act No. 10121 and Solid Waste Management Ac{ of
2001, known as RePublic Aci No. 9003

4. Upon receipl of lhe check from the DILG Regional Office, the LGU recipient shall
issue an official receipt acknowledging lhe financial subsidy.

lmplementation and Disbursement of Financial Subsidy

1. The disbursement of the Gawad subsidy shall strictly adhere to the approved
prqect proposal and in accordance with the provision of signed MOA between
the Gawad recipient LGU and the DILG.

lmplementation of the project, as much as praclicable, shall be within one (1)

year period upon receipt of the financial subsidy.

Disbursement of the fund shall be subjed to existing accounting and auditing

rules and regulataons

Monitoring and Reporting

1. Gawad Pamana recipient LGUs shall submil to the concemed DILG Regional
office quarterly physical and financial report indicating the progress of
implementation of the project, and completion report once the project is
completed; and cause the posting of the same at the LGU website and/or DILG
websites (as provided for under DILG MC 2011-162 dated November 24' 2011)

The DILG Regional Office shall continue to be primary accountable and

responsible in monitoring the progress of the implementation of Gawad
incentive-supported projects, and in ensuring the completion of said projec{s
based on approved projecl proposals and in accordance with signed
Memorandum of Agreement between the LGU PCF recipient and the DILG.

The Regional Office shall conespondingly submit to DILG Cenlral Office quartedy
reports of their financial and physical accomplishment of the LGU recipients of
the Gawad Pamana ng Lahi with the corresponding financial subsidy, projects
undertaken and utilization of funds.

4. The Central Ofiice thru the Bureau of Local Govemment Development (BLGD)
shall submit the consolidated report to the DBM, the House Committee on
Approprialions and Senate Committee on Finance separate quarterly reports on
the project.

For comoliance of all concerned.

Secretary
R6plbric of rhe Philippi.Es
o€PlRltal[ of nE NEtroR

s tLG't 1.01t 4f6

Ituilillilililruffi|llll
 SamDle MOA

MEMORANDUM OF AGREEMENT

This Memorandum ofAgreement entered into and executed this of by'

The Department of the Interior and Local Government (DILG) herein referred to as the
DILG-Region with principal address at rep resented herein
-
by Regional Director

and

The Local Government Unit herein referred to as LGU Gawad Pamana

ng Lahi recipient with principal office at and represented in this agreement
by its [Governor/City/Municipal Mayor) by virtue of Municipal Sanggunian
Resolution No. Series of
- -. WITNESSETH

WHEREAS, the Department of the lnterior and Local Government IDILG) through the
Bureau of Local Government Development (BLGD) is the Office with primary responsibility in
localizing the Millennium Development Coals (MDGsJ and capacitating LGUs to effectively discharge
their powers and functions towards improving the delivery of basic services and facilities to theil'
constituents;

WHEREAT the Development Budget Coordinating Committee (DBCC) of the Department of

Budget and Management [DBM] approved the Performance Based Incentive Policy {PBICJ which
provides for an incentive framework to rationalize national government and intergovernmental
transfers to LGUs towards improving LGU performance in governance and delivery of basic
services.

WHEREAS, the Performance Challenge Fund (PCF) for Local Government Units is an
incentive fund for LGUs in the form of counterpart funding to high-impact capital investment
proiects in the Annual lnvestment Program [AlP) and funded out of the 20o/o Local Development
Fund ILDF) consistent wit]r national development goals and priorities;

WHEREAS, the Performance Challenge Fund (PCF) is being administer-ed by the

Department of the Interior and Local Government in collaboration with the Department of Budget
and Management IDBMJ to recognize good governance performance particularly in the adoption of
"good housekeeping" along the governance areas of development planning sound financial
management, transparency and accountability, and valuing performance monitoring;

WHEREAS, the Performance Challenge Fund progressive realization to achieve the

Millennium Development Goals IMDGsJ, maintenance of core road network to boost tourism and
local economic development and comply with the Philippine Disaster Risk Reduction IDRRJ and
Management Act of 2010 and Ecological Solid Waste Management Act of 2000, programs and
proiects is anchored on the contribution of local government units (LGUsJ, as well as non-
government and private sector organizations;

WHEREAS, Local Government Units ILGUs), as provided under the Local Government Code
of 1991 or Republic Act 7160, assume the primary responsibility for the provision of basic services
and facilities and t}re improvement of quality of life of their constituents towards the achievement
of MDGs. DRR and CCA:
 WHEREAS, the Provinceand/or City/Municipality has been has been
awarded the Gawad Pamana ng Lahi thereby entitles the LGU to receive the Gawad Pamana ng
Lahi Fund Subsidy amounting to a maximum of tP _).
NOW TI{EREFORE in considerahon of the above premises and of the mutual covenants
stipulated hereinafter set forth the PARTIES hereto agree to enter into this Memorandum of
Agreement to adhere to the following terms and conditions:

Section I. Requirements for the Release of Gawad Pamana ng Lahi Financial Subsidy

The following requirements should be submitted to DILG through the DILC Regional Offices:

1. Letter of intent of LGU subsidyee along with the following:

a. Proiect Design inclusive of description, location, workplan and proiect schedule,

budget and financing plan, project management and other financing partners or
supplementary financing, if any;

b. Sanggun ian Resolution'

Authorizing the Local Chief Executive to enter into a Memorandum of Agreement

[MOA) for the PC Fund subsidy

al Approving the allocation of LGU funds as counterpart to the PC Fund subsidy;

and
bl Certirying that the proiect is included inthe 2011Annual Investment Program

Certification from the Municipal Treasurer that the project is receiving a budget
from the 20o/o Development Fund equivalent to the above requirements.

Section 2. Eligible Projects

Eligible projects for the PC Fund Subsidy are those that support the national priorities of
the present administration in achieving the MDGs [e.g. livelihood and employment generating
projects, school buildings, hospital and health centers, training and crisis centers) which are
implementable in one (1) year.

Section 3. Delineation of Responsibilities

PCF Recipient LGU shall:

1. Comply with the documentary requirements under Section 1 for the release of PC Fund
subsidy;
2. Open a Special Account in a government bank and provide the DILG Regional Office a
certification from the Local Treasurer and t}te details of t}te account
3. Maintain a Book ofAccounts for the PC Fund;
4. Issue an official receipt corresponding to the amount of PC Fund subsidy received;
5. Create a PCF Project Team responsible for the implementation of the proiecq
6. Submit to the DILG Regional Office quarterly physical reports of accomplishments and
fund utilization repor! and liquidation report verified by the local COA Officer;

DILG Regional Ofice shall:

1. Prepare and issue checks as cash advances to the LGU subsidyee subject to Pre-Audit
pursuant to COA Circular 2009-2;
2. After 5 working days of satisfactory compliance to PCF subsidy requirements and upon
signing of the Memorandum of Agreement between the DILG and LGU subsidyee shall
release the PCF Subsidy to the LGU subsidyee;
 3. Facilitate the release of PCF subsidy amounting to a maximum of
P-)to tlle recipient LGU upon signing of the
Memorandum of Agreement and the sausfactory of submission documentary
requirements under Section 1 by the LGU; and
4. Monitor the progress ofproject implementation by the LGUs and disbursement of funds
by the LGU subsidyee and submit consolidated status report on the implementation of
PCF funded proiect, and liquidation report to the FMS; and

This agreement shall take effect immediately upon signing by the representatives of the
Parties hereto and shall be enforce within one {1) year upon completion of the proiect.

lN WITNESS WHEREOF, the Parties hereunto affixed their signatures on this day of
Philippines. -

DILG-Regional Office

Department of the Interior and Local Government

Region

-
LGU

Governor and/or City/Municipal Mayor

SIGNED IN THE PRESENCE OF:

 ACKNOWLETICEMEI|T

REPUBLIC OF THE PHILIPPINESI

) ss.

BEFORE ME, a notary public, for and in tJte above iurisdiction, personally appeared on this :

NAME CTC.NO. DATE/PLACEOFISSUE

DILG Regional Director

MAYOR

Known to me to be the person/s who execut€d the foregoing instrument and acknowledge
to me is his,/her free and voluntarv act and deed.

The parties have signed this Memorandum ofAgreement consisting of_ pageg including
the page where the acknowledgement is written. and their instrumental witnessed on the left
nargin ofeach and every page,

IN WITNESS WHEREOR I have hereunto set my hand on tlle date and place above written.

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