PHILIPPINE LOCAL GOVERNANCE

a. Definition of Law and Political Law

Law

Law is a set of rules that people must follow. These rules are made and followed
by social or government institutions to control behavior.

The law is a fundamental instrument of governmental action, serving as a means

for the government to exert influence over society.

These can be written statutes, judicial rulings (case law), or even unwritten
customs that are recognized and enforced by the legal system.

These rules can be written down or understood by everyone, and they help keep
things organized and fair. They tell us what we can and can't do, and there are
consequences for breaking them.

Political Law

This is like the rulebook for the government. It explains how the government
works, how people get elected, and how decisions are made. It also sets limits
on what the government can and can't do to protect the rights of everyone.

Political law, also called public law or constitutional law, is concerned with the
legal structure that regulates the operations of the state.

b. Subdivisions of Political Law

Constitutional Law

Constitutional law is the study of the constitution, which is the ultimate law of the
land and establishes the fundamental rights of individuals, the powers and
composition of the government, and the limitations of state authority.
 Administrative Law

It ensures that administrative agencies operating under the executive branch

follow the law and behave fairly when formulating rules and making other
decisions.

Election Law

Governs the electoral process to guarantee free and fair elections. This includes
voter registration, campaign funding, ballot access, and voting practices.

Legislative Law

It focuses on the laws that govern the legislative, encompassing its composition,
the processes by which laws are passed, and the restrictions placed on its
authority.

c. Definition of Corporation

A corporation is a separate and distinct legal entity from its shareholders. As far
as the law is concerned, corporations and individuals share numerous rights and
responsibilities. They are able to enter into contracts, borrow and lend funds, sue
and be sued, own assets, employ personnel, and pay taxes.

d. Classes of Corporation

Nonprofit Corporations

Non-profit organizations are established primarily for social, religious, or other

non-profit goals. The income they generate is reinvested into the organization's
objective rather than distributed to shareholders or owners.

Examples: Charitable organizations, religious institutions, educational institutions,

hospitals, research organizations, advocacy groups.

Municipal Corporations

Local governmental entities are responsible for providing necessary services and
performing functions within specific jurisdictions, such as cities, towns, villages,
counties, and special districts.
 Professional Corporations

Professionals such as lawyers, surgeons, accountants, and architects developed

it to practice their respective professions. It ensures compliance with
professional regulations while offering incorporation benefits such as limited
liability and tax advantages.

Business Corporations

Established with the primary objective of producing a profit for the benefit of the
company's stockholders.

● Publicly held corporations have shares that can be bought and sold on
public stock exchanges by anyone.
● Closely held corporations have shares that are only owned by a small
group of people, usually family members or investors.

e. Public vs. Private Corporations

Public Corporations

Ownership: People can buy and sell shares on public stock markets, meaning
anyone can own them. A lot of buyers have shares in the business.

Funding: They can get more money by selling more shares on the stock market
or selling new shares to the public through Initial Public Offerings (IPOs).

Regulations: Because it is owned by the public, it has to follow tighter rules and
make more reports, such as SEC filings and public audits.

Apple, Microsoft, Amazon, and Tesla are some examples.

Private Corporations

Ownership: Shares are not sold on the stock market; they are owned by a small
group of people or businesses, including founders, venture capitalists, and
investors from the private sector.

Funding: Primarily rely on personal savings, bank loans, or private equity firms.
 Regulations: They must follow fewer rules and report less often than public
companies but still follow all laws and business standards.

SpaceX, WeWork, and Uber before they went public are some examples.

f. Classes of Public Corporations

Quasi-Corporations

The government gives private companies certain public duties through a charter
or legal document. Often, these jobs involve offering essential services like water,
electricity, transportation, or health care.

Examples: Water utilities, power companies, transportation authorities, toll roads,

hospitals (some).

Municipal Corporations

Municipal corporations are the foundation of local government. They are legal
entities created by law with the capacity to govern a particular area and deliver essential
services to its citizens. They do not belong to or are controlled by individuals or
shareholders but instead represent the public in their respective jurisdictions. This
implies they work in the most significant interests of the community, not for personal
gain. Their choices are based on democratic values and accountability to the people
they serve.

Examples: Cities, Towns, Villages, Countries and Special District

g. Definition and Elements of Municipal Corporations

A municipal corporation, or local government unit (LGU), is a legally recognized

institution created by legislation to govern a particular area and deliver necessary
services to its residents. They are the fundamental local administration units within a
specific city, town, village, county, or special district.

Public Entity: Municipal corporations, in contrast to private corporations, are not

privately held by people or shareholders. Their primary role is to serve the community's
needs and interests rather than focusing on generating profit, as they represent the
public under their jurisdiction.
 2. Non-Profit Objective: Their primary goal is not to maximize profit but to
promote the public's welfare and local development. They offer essential services such
as:

➢ Public infrastructure refers to the physical structures and facilities owned

and operated by the government, such as highways, bridges, and
buildings.
➢ Law enforcement, firefighting, and emergency response services
➢ Hygiene and disposal of garbage
➢ Public health and education
➢ Public parks and recreational facilities

3. Restricted independence: Although they possess autonomous authority, they

function within national legislation and rules. This makes sure that local needs and
priorities are met while still being in line with more extensive national policies.

4. Defined Functions and Powers: Their charters and relevant laws specify their
precise duties and powers. These legal documents select their limits, areas of authority,
and range of services. This guarantees accountability and transparency in how they use
resources and exercise power.

h. Local Government

i. Definition

Local government provides a means for community-based civil society

organizations to engage in decision-making actively.

The lowest level of authority in a sovereign state, in charge of managing a particular

region and offering its citizens' necessities.

ii. Dual Personality of Local Government

Local Government Units (LGUs) exhibit characteristics of both a

public/governmental entity and a private/corporate entity.

Public/Governmental: Serving the public, subject to national laws, limited powers,

accountable to the public.
 Private/Corporate: Legal entity, owns assets, limited profit-making, operational
flexibility.

A Government Entity

Local Government Units (LGUs) are the national government's local extension.
Within their assigned territories, they provide vital services like sanitation, education,
public safety, and infrastructure maintenance. National laws and regulations guide their
actions, guaranteeing uniformity and adherence to larger national aims and policies.

A Corporate Entity

LGUs are considered legal entities, meaning they can make deals, own land, and
even go to court to sue or be sued. They are not part of the national government and
have their own assets and resources. Even though they're interested in making money,
they can do things like fees or small businesses to support their budgets.

iii. LG as agency of the State

Unlike regular government departments, local governments cannot be merely

regarded as "agencies of the state". They are separate organizations with particular
traits, such as a degree of autonomy, a local emphasis, and a special fusion of
corporate and public elements. They have some freedom and accountability to their
local communities, but they also function within the confines of the national legal
framework.

i. Powers and Functions of Local Government

Local government units (LGUs) are critical in the Philippines because they
provide services and encourage development at the community level. Their powers and
duties are very different from those of most "agencies of the state" due to the principle
of decentralization.

Most Important Duties:

They are offering essential services like public safety (police, fire), infrastructure
(roads, sewers), public health (clinics), education (schools), and social benefits to the
people who live in their area.
 Local development means boosting the economy by luring businesses to the
area, controlling how land is used, and putting money into building up facilities.

Giving out licenses and permits, following local rules and laws, collecting taxes
and fees, and keeping the peace in the areas they are responsible for.

Unique Powers under Decentralization:

Large Amount of Independence: Local governments (LGUs) have a large amount

of independence in operating their businesses and finances. This means they can make
choices based on local needs and goals, unlike most state agencies that the national
government directly controls.

Broad Powers: The Local Government Code of 1991 (RA 7160) gives them much
power over things like education, health care, infrastructure, social services, and
economic growth. They can change policies and plans to fit their needs.

Own Sources of Revenue: Local governments get money from local taxes, fees,
and user charges, plus funds from the national government. This gives them more
freedom in how they use their resources.
Being responsible:

Dual Accountability: Local governments are responsible to both the national

government for following the rules and laws, and to the people who live in their areas
directly through elections, public meetings, and other means.

Some examples of functions and powers:

➢ Provinces can make their plans for economic growth, build hospitals, and
run their services to help farmers.
➢ Cities can make rules about zoning, spend in infrastructure for tourists,
and enforce local environmental laws.
➢ Cities and towns can give business licenses, run local fairs, and offer
primary medical care.
➢ Barangays, the smallest unit, can hold community clean-up days, settle
local conflicts, and build small-scale infrastructure.
 i. Sources of Power of Local Governments

In the Philippines, the powers of Local Government Units (LGUs) stem from three main
sources, reflecting the unique system of decentralization:

1. Constitutional Mandate:

The 1987 Philippine Constitution provides the foundational source of power.

Article X specifically empowers LGUs with autonomy and outlines their key roles in local
governance and development.

This includes managing:

➢ Public services (health, education, infrastructure)
➢ Local development (planning, investment, land use)
➢ Regulatory functions (licensing, taxation)
➢ Budgeting and personnel management

2. Local Government Code of 1991 (RA 7160):

➢ This comprehensive law serves as the legal backbone for LGUs, detailing their
specific powers and limitations.
➢ It grants them broad authority in areas like:
➢ Public service delivery (healthcare, education)
➢ Local development planning and implementation
➢ Regulatory functions (issuing permits, collecting taxes)
➢ Internal resource management

3. Decentralization Principle:

➢ enshrined in the Constitution, this principle grants LGUs significant autonomy in

decision-making and resource allocation.
➢ They can tailor policies and programs to their specific needs and context, unlike
agencies directly controlled by the national government. This allows for:
➢ Responsive governance: Addressing local needs more effectively.
➢ Innovation and experimentation: Trying new solutions to local challenges.
➢ Increased accountability: Being directly answerable to local constituents.
ii. Classification of Local Government Powers

Classification of Local Government Powers in the Philippines

The powers of Local Government Units (LGUs) in the Philippines can be classified in
several ways, depending on the perspective and purpose of the classification. Here are
some common approaches:

1. By Source of Power:

➢ Constitutional Powers: Powers directly granted by the 1987 Philippine

Constitution (e.g., autonomy, governance, development).
➢ Statutory Powers: Powers specified in the Local Government Code of 1991 (RA
7160) and other relevant laws.
➢ Implied Powers: Powers not explicitly stated but necessary for fulfilling their
mandated functions.

2. By Nature of Power:

➢ Governmental Powers: Powers related to governing their jurisdiction, providing

public services, and maintaining order (e.g., tax collection, law enforcement,
infrastructure management).
➢ Proprietary Powers: Powers similar to private entities, allowing them to own
property, enter contracts, and generate revenue (e.g., investments, user charges,
fees).
➢ Regulatory Powers: Powers to regulate activities within their jurisdiction through
ordinances, licensing, and permits.

3. By Level of Government:

➢ Provincial Powers: Powers specific to provinces, such as managing natural

resources and overseeing component LGUs.
➢ City and Municipal Powers: Powers common to both cities and municipalities,
focusing on delivering essential services and local development.
➢ Barangay Powers: Powers entrusted to the smallest governance unit, mainly
focused on community peace and order, basic services, and dispute settlement.

4. By Functional Area:

➢ Public Services: Powers related to healthcare, education, sanitation, waste

management, social welfare, etc.
 ➢ Local Development: Powers to plan, manage, and regulate economic
development, land use, infrastructure projects, etc.
➢ Regulatory Functions: Powers to issue permits, licenses, collect taxes and fees,
enforce local laws and regulations.
➢ Financial Management: Powers to budget, borrow funds, manage assets, and
generate revenue.

iii. Execution of Municipal Powers

In the Philippines, executing municipal powers involves various legal and practical
measures ensuring efficient and accountable service delivery.

Constitutional and Legal Framework:

Constitution: Provides the foundation for municipal powers, guaranteeing local

autonomy and outlining core responsibilities.

Local Government Code (RA 7160): Serves as the primary legal framework, specifying
powers, functions, and limitations of municipalities.

Other Laws and Regulations: Additional national laws and regulations might impact
specific powers and their execution.

Main Actors:

Municipal Mayor: Chief executive officer, responsible for implementing programs and
policies, exercising executive powers, and supervising departments.

Sangguniang Bayan (Municipal Council): Legislative body, responsible for enacting

ordinances, approving budgets, and overseeing implementation of programs.

Municipal Departments: Each department carries out specific functions according to

their mandates, executing relevant powers under the mayor's supervision.

Key Steps in Executing Municipal Powers:

Planning and Policy Development: Assessing needs, identifying priorities, formulating

plans and policies aligned with legal frameworks and local context.
Budgeting and Resource Allocation: Ensuring sufficient resources are allocated for
planned activities within legal and budgetary limitations.

Implementation: Departments and relevant actors carry out plans and policies using
allocated resources, adhering to legal procedures and standards.

Monitoring and Evaluation: Regularly assessing progress, measuring impact, and

making adjustments as needed to ensure effectiveness and efficiency.

Reporting and Accountability: Reporting to the Sangguniang Bayan and constituents on

progress, achievements, and challenges, ensuring transparency and accountability.

iv. Supreme Court Decisions on the Powers of Local Government

The Supreme Court of the Philippines plays a crucial role in defining and interpreting the
powers of local government units (LGUs) through its decisions.

Key Points:

● The Supreme Court interprets the Constitution, the Local Government Code (RA
7160), and other relevant laws to determine the scope and limitations of LGU
powers.
● Decisions can clarify ambiguities, settle disputes between LGUs and other
entities, and establish new precedents regarding specific powers.
● The Court balances the autonomy of LGUs with the need for national unity and
compliance with national laws and policies.

Examples of Supreme Court Decisions:

● Mandanas et al. vs. Ochoa et al. (G.R. Nos. 199802 & 208488, July 3, 2018):
This landmark case clarified the computation of LGUs' share in national internal
revenue taxes, significantly increasing their financial resources and autonomy.
● Social Justice Society (SJS) et al. vs. Hon. Jose L. Atienza, Jr. (G.R. No. 156052,
March 10, 2004): Upheld the authority of the City of Manila to regulate and zone
its territory, including the establishment of industrial zones.
● Province of Laguna vs. Laguna Lake Development Authority (LLDA) (G.R. No.
160013, July 10, 2007): Recognized the concurrent jurisdiction of the province
and the LLDA in managing Laguna Lake, emphasizing the need for coordination
and cooperation.
 ● League of Cities of the Philippines vs. Department of Interior and Local
Government (DILG) (G.R. No. 188409, December 19, 2012): Declared certain
DILG circulars restricting the power of cities to issue business permits as
unconstitutional, upholding LGU autonomy.

j. Rules on the Properties of the Local Government