LOCAL GOVERNMENT CODE

OF THE PHILIPPINES

ATTY. JOMAR V. RONDOLO

PRINCIPLE OF LOCAL AUTONOMY

• 1. DECENTRALIZATION OF ADMINISTRATION; OR
• 2. DECENTRALIZATION OF POWER
DECENTRALIZATION OF
ADMINISTRATION
There is decentralization of administration when the central government
delegates administrative powers to political subdivisions in order to broaden
the base of government power and in the process make local governments
‘more responsive and more accountable’ and ensure their fullest development
as self-reliant communities and make them more effective partners in the
pursuit of national development and social progress.’
DECENTRALIZATION OF POWER

• IT INVOLVES AS ABDICATION OF POLITCAL POWER IN FAVOR OF LOCAL

GOVERNMENT UNITS DECLARED TO BE AUTONOMOUS.
• THIS IS ALSO TERMED AS DEVOLUTION.
PRESIDENTIAL POWER OF SUPERVISION

Autonomy, however, is not meant to end the relation of partnership and

interdependence between the central administration and local government
units. Local governments, under the Constitution, are subject to regulation,
however limited, and for no other purpose than precisely, albeit paradoxically,
to enhance self-government. (Ganzon v. Court of Appeals, G.R. No. 93252,
August 5, 1991)

The president’s power over LGUs is now limited to supervision, not control.
The president exercises “general supervision” over the LGUs, but only to
“ensure that local affairs are administered according to law.” It means
“overseeing or the authority of an officer to see that the subordinate officer
perform their duties. If the subordinate officers fail or neglect to fulfill their
duties, the official may take such action or steps as prescribed by law to make
them perform their duties.
DUAL PERSONALITY OF LOCAL GOVERNMENT
UNITS

LGUs have a dual personality: political and corporate. Being political units of
government and as agents of the national government, LGUs exercise
governmental powers. On the other hand, as a corporate entity, they exercise
powers which are proprietary in nature but which they can perform for the
benefit of their constituencies
Under Philippine laws, the City of Manila is a political body corporate and as such (is)
endowed with the faculties of municipal corporations to be exercised by and through its
city government in conformity with law, and in its proper corporate name. It may sue and
be sued, and contract and be contracted with.
Its powers are twofold in character-public, governmental or political on the one hand, and
corporate, private and proprietary on the other. Governmental powers are those exercised
in administering the powers of the state and promoting the public welfare and they include
the legislative, judicial, public and political. Municipal powers on the one hand are
exercised for the special benefit and advantage of the community and include those which
are ministerial, private and corporate (City of Manila v. Intermediate Appellate Court,
G.R. No. 71159, November 15, 1989).
LOCAL FISCAL AUTONOMY

Fiscal autonomy means that local governments have the power to create their
own sources of revenue in addition to their equitable share in the national
taxes released by the national government, as well as the power to allocate
their resources in accordance with their own priorities.

The shares of the LGUs in the central government taxes and in the proceeds
of natural resources within their territories shall be automatically and directly
released to them.
QUESTION

• WHAT IS THE BASIS OF THE PRESIDENT’S GENERAL SUPERVISON?

ANSWER

• UNDER ART. X. SEC. 16 OF THE 1987 CONSTITUTION, IT STATES THAT THE

PRESIDENT SHALL EXERCISE GENERAL SUPERVISION OVER
AUTONOMOS REGIONS TO ENSURE THAT THE LAWS ARE FAITHFULLY
EXECUTED.
POWERS OF THE LGU

• 1. POLICE POWER
• 2. EMINENT DOMAIN
• 3. TAXATION
• 4. LEGISLATIVE POWER
NATURE OF POLICE POWER

The police power of the LGU is not inherent. LGUs exercise the police power
under the general welfare clause (LGC, Sec. 16,).
GENERAL WELFARE CLAUSE

LGUs shall exercise powers that are necessary, appropriate, or incidental for
its efficient and effective governance, and those which are essential to the
promotion of general welfare.
2 BRANCHES OF THE GENERAL WELFARE
CLAUSE

• 1. GENERAL LEGISLATIVE POWER

- Authorizes the municipal council to enact ordinances and make regulations not
repugnant to law, as may be necessary to carry into effect and discharge the powers
and duties conferred upon the municipal council by law.

• 2. POLICE POWER PROPER

- Authorizes the municipality to enact ordinances as may be necessary and proper for
the health and safety, prosperity, morals, peace, good order, comfort, and convenience
of the municipality and its inhabitants, and for the protection of their property
LIMITATIONS FOR THE PROPER EXERCISE OF THE POLICE
POWER

1. The interests of the public generally, as distinguished from those of a particular class, require
the interference of the state(Equal Protection Clause)

2. The means employed are reasonably necessary for the attainment of the object sought to be
accomplished and not duly oppressive (Due Process Clause)

3.Exercisable only within the territorial limits of the LGU, except for protection of water
supply (LGC, Sec. 16)

4.Must not be contrary to the Constitution and the laws

TESTS WHEN POLICE POWER IS INVOKED AS THE RATIONALE FOR THE
VALID PASSAGE OF AN ORDINANCE

1.Rational relationship test – An ordinance must pass the requisites as

discussed above.

2.Strict scrutiny test – The focus is on the presence of compelling, rather than
substantial, governmental interest and on the absence of less restrictive
means for achieving that interest.
QUESTION

The Sangguniang Panlungsod of Davao City enacted an ordinance imposing a ban

against aerial spraying as an agricultural practice by all agricultural entities within
Davao City. Pursuant to the ordinance, the ban against aerial spraying would be strictly
enforced three months thereafter. The Pilipino Banana Growers and Exporters
Association, Inc. (PBGEA) filed a petition in the RTC to challenge the constitutionality
of the ordinance, alleging that the ordinance exemplified the unreasonable exercise of
police power and violated the equal protection clause. The RTC declared that the
ordinance is valid and constitutional saying that the City of Davao had validly exercised
police power under the General Welfare Clause of the Local Government Code and that
the ordinance was consistent with the Equal Protection Clause. On appeal, however, the
CA reversed the judgment of the RTC. Is the ordinance valid?
ANSWER

NO. Requiring the respondents and other affected individuals to comply with the consequences of the ban
within the three-month period under pain of penalty like fine, imprisonment and even cancellation of
business permits would definitely be oppressive as to constitute abuse of police power.

The ordinance violated the equal protection clause. The imposition of the ban is too broad because the
ordinance applies irrespective of the substance to be aerially applied and irrespective of the agricultural
activity to be conducted. Such imposition becomes unreasonable inasmuch as it patently bears no relation to
the purported inconvenience, discomfort, health risk and environmental danger which the ordinance seeks to
address. Theburden will now become more onerous to various entities, including those with no connection
whatsoever to the intended purpose of the ordinance.
(Mosqueda vs. Pilipino Banana Growers & Exporters Assoc., G.R. No. 189185 & 189305, August 16, 2016)
MINISTERIAL DUTY OF THE LOCAL CHIEF
EXECUTIVE

The LGC imposes upon the city mayor, to “enforce all laws and ordinances
relative to the governance of the city.” As the chief executive of the city, he
has the duty to enforce an ordinance as long as it has not been repealed by the
Sanggunian or annulled by the courts. He has no other choice. It is his
ministerial duty to do so.
ABATEMENT OF NUISANCE WITHOUT JUDICIAL
PROCEEDINGS

The abatement of nuisances without judicial proceedings applies to nuisance

per se or those which affect the immediate safety of persons and property and
may be summarily abated under the undefined law of necessity

The LGUs have no power to declare a particular thing as a nuisance unless

such a thing is a nuisance per se; nor can they effect the extrajudicial
abatement of a nuisance per accidens. Those things must be resolved by the
courts in the ordinary course of law.
QUESTION

The Mayor of Malay, Aklan ordered through Executive Order No.

10 the demolition of the Boracay West Cove Resort and Hotel
without first conducting judicial proceedings on the ground that
the said hotel was built on a "no build zone" as demarcated in
Municipal Ordinance 2000-131. The owner of the Boracay West
Cove imputed grave abuse of discretion on the part of the Mayor.
Is the owner correct?
ANSWER

NO. Generally, LGUs have no power to declare a particular thing as a

nuisance unless such a thing is a nuisance per se. Despite the hotel’s
classification as a nuisance per accidens, however, the Court still found in this
case that the LGU may nevertheless properly order the hotel’s demolition.
This is because, in the exercise of police power and the general welfare
clause, property rights of individuals may be subjected to restraints and
burdens in order to fulfill the objectives of the government.
Otherwise stated, the government may enact legislation that may interfere with personal liberty,
property, lawful businesses and occupations to promote the general welfare.

One such piece of legislation is the LGC, which authorizes city and municipal governments, acting
through their local chief executives, to issue demolition orders. Under existing laws, the office of the
mayor is given powers not only relative to its function as the executive official of the town; it has also
been endowed with authority to hear issues involving property rights of individuals and to come out
with an effective order or resolution thereon. Pertinent herein is Sec. 444 (b)(3)(vi) of the LGC, which
empowered the mayor to order the closure and removal of illegally constructed establishments for
failing to secure the necessary permits.
In the case at bar, Boracay West Cove admittedly failed to secure the
necessary permits, clearances, and exemptions before the construction,
expansion, and operation of Boracay West Cove’s hotel in Malay, Aklan. To
recall, Boracay West Cove declared that the application for zoning compliance
was still pending with the office of the mayor even though construction and
operation were already ongoing at the same time. As such, it could no longer
be denied that it openly violated Municipal Ordinance 2000-131
(Aquino v. Municipality of Malay, Aklan, G.R. No. 211356, September 29,
2014).
EMINENT DOMAIN

Local government units have no inherent power of eminent domain. Local

governments can exercise such power only when expressly authorized by the
Legislature. By virtue of the Local Government Code, Congress conferred upon
local government units the power to expropriate. (Masikip v. City of Pasig, G.R.
No. 136349, January 23, 2006)

Strictly speaking, the power of eminent domain delegated to an LGU is in reality

not eminent but “inferior”. The national legislature is still the principal of the
LGUs, and the latter cannot go against the principal’s will or modify the same
(Beluso v. Municipality of Panay, G.R. No. 153974, August 7, 2006).
REQUISITES FOR THE VALID EXERCISE OF THE POWER OF EMINENT
DOMAIN

• 1. An Ordinance is enacted by the local

legislative council authorizing the local chief executive, in behalf of the LGU, to exercise the
power of eminent domain or pursue expropriation proceeding over a particular private property.

• 2. It must be for Public use, purpose, or welfare or for the benefit of the poor or landless

• 3. There must be payment of just Compensation

• 4. A valid and definite Offer has been previously made to the owner of the property sought to be
expropriated, but said offer was not accepted.
QUESTION

• THE SANGGUNIAN OF SAN PABLO CITY MADE A RESOLUTION

EXPROPRIATING ULTIMART SHOPPING PLAZA TO BE TURNED AS A
CENTRAL TERMINAL OF ALL BUSES GOING TO MANILA, LUCENA OR
BICOL AREA. THE MANAGEMENT OF ULTIMART ACCEPTED IT
CONSIDERING THAT THEY HAVE BEEN OFFERED A HUGE AMOUNT OF
MONEY.

IS THE EXPROPRIATION VALID?

ANSWER

• NO, THE EXPROPRIATION IS NOT VALID.

IN THE LINE OF OF JURISPRUDENCE DECIDED BY THE SUPREME COURT,
IT STATES THAT A MERE RESOLUTION CANNOT VALIDLY TAKE A PRIVATE
PROPERTY EVEN THOUGH THE OWNER HAS GIVEN HIS CONSENT AND
ACCEPTED THE OFFER.

IN THE INSTANT CASE, THE EXPROPRIATION IS NOT VALID DUE TO THE

FACT THAT THE SANGGUNIAN PANGLUNGSOD OF SAN PABLO CITY ONLY
ISSUED A RESOLUTION OF THE EXPROPRIATION. AN ORDINANCE
DECLARING THE EXPROPRIATION IS NEEDED TO JUSTIFY THE
EXPROPRIATION.
DUE PROCESS REQUIREMENTS IN EMINENT DOMAIN

• OFFER MUST BE IN WRITING SPECIFYING:

1. PROPERTY SOUGHT TO BE ACQUIRED;
2. THE REASON FOR ACQUISITION;
3. THE PRICE OFFERED.
ELEMENT FOR AN AUTHORIZED IMMEDIATE
ENTRY

1.Filling of a complaint for expropriation which is sufficient in form and

substance

2.Deposit of the amount equivalent to fifteen percent (15%) of the fair

market value of the property to be expropriated based on its current tax
declaration.
PHASES OF EXPROPRIATION PROCEEDINGS

1. The determination of the authority of the plaintiff to exercise the power of

eminent domain and the propriety of its exercise in the context of the facts
involved in the suit.

2. The determination by the RTC of the just compensation for the property
sought to be taken
PUBLIC USE

• WHAT IF ONYL A FEW PEOPLE WILL BE BENEFITED FROM THE

EXPROPRIATION? IS THE EXPROPRIATION STILL VALID?
• YES IT IS STILL VALID. In case only a few could actually benefit from the
expropriation of the property, the same does not diminish its public use character. It is
simply not possible to provide for all at once, land and shelter, for all who need them.
Corollary to the expanded notion of public use, expropriation is not anymore confined
to vast tracts of land and landed estates. It is therefore of no moment that the land
sought to be expropriated is less than half a hectare only. Through the years, the public
use requirement in eminent domain has evolved into a flexible concept, influenced by
changing conditions. Public use now includes the broader notion of indirect public
benefit or advantage including in particular, urban land reform and housing.
• (Philippine Columbian Association v. Panis, G.R. No. L-106528, Dec. 21, 1993)
QUESTION

May LGUs expropriate a property to provide a right-of-way to residents of a

subdivision?
ANSWER

NO. Considering that the residents who need a feeder road are all subdivision lot
owners, it is the obligation of the subdivision owner to acquire a right-of-way for them.
However, the failure of the subdivision owner to provide an access road does not shift
the burden to the LGU concerned. To deprive respondents of their property instead of
compelling the subdivision owner to comply with his obligation under the law is an
abuse of the power of eminent domain and is patently illegal. Worse, the expropriation
will actually benefit the subdivision’s owner who will be able to circumvent his
commitment to provide road access to the subdivision in conjunction with his
development permit and license to sell from the Housing and Land Use Regulatory
Board, and also be relieved of spending his own funds for a right-of-way. (Barangay
Sindalan v. CA G.R. No. 150640, March 22, 2007)
TAXING POWER

It is already well-settled that although the power to tax is inherent in the State,
the same is not true for the LGUs to whom the power must be delegated by
Congress and must be exercised within the guidelines and limitations that
Congress may provide.
QUESTION

Can the local governments tax national

government instrumentalities?
ANSWER

Sec. 133 of the LGC states that “unless otherwise provided in the
Code, local governments cannot tax national government
instrumentalities. This doctrine emanates from the “supremacy”
of National government over local governments.
MAIN SOURCES OF REVENUES OF LGUs

1.Taxes, fees, and charges. (1987 Constitution Art. X, Sec. 5)

2.Internal Revenue Allotment (IRA) - Just share in the national

taxes which shall be automatically released to them. (1987
Constitution Art. X,Sec. 6)
PRINCIPLES GOVERNING EXERCISE OF TAXING AND REVENUE-SHARING
POWERS OF LGUs

1.Taxation shall be uniform in each LGU

2.Taxes, fees, charges and other impositions shall be equitable and

based as far as practicable on the taxpayer’s ability to pay; it shall be
levied and collected only for public purpose; it must not be unjust,
excessive, oppressive, or confiscatory; it must not be contrary to law,
public policy, national economic policy, or restraint of trade;
 • The collection of local taxes, fees, charges and other impositions shall in
no case be let to any private person.

• The revenue collected shall inure solely to

the benefit of, and be subject to disposition by, the local government unit,
unless specifically provided therein.

• Each local government unit shall, as far as practicable, evolve a progressive

system of taxation. (LGC, Sec. 130)
REQUIREMENTS FOR A VALID TAX
ORDINANCE

1.The tax is for a public purpose;

2.The rule on uniformity of taxation is

observed;

3.Either the person or property taxed is within

the jurisdiction of the government levying the
tax; and

4.In the assessment and collection of certain

kinds of taxes, notice and opportunity for hearing are provided. (Pepsi-Cola Bottling Co. v.
Municipality of Tanauan, G.R. No. L-31156, February 27, 1976)
PROCEDURAL REQUIREMENTS FOR A VALID REVENUE ORDINANCE

1. A prior public hearing on the measure to be conducted according to the

prescribed rules.

2. Publication of the tax ordinance, within 10 days after their approval,

for 3 consecutive days in a newspaper of local circulation, provided that
in provinces, cities, and municipalities where there are no newspapers of
local circulation, the same may be posted in at least two (2) conspicuous
and publicly accessible places.
COMMUNITY TAX

Community tax is a poll or capitation tax which is

imposed upon person who resides within a
specified territory.
REAL PROPERTY TAXES

These are directly imposed on privilege to use real

property such as land, building, machinery, and
other improvements, unless specifically
exempted.
INSTANCES WHERE THE PRESIDENT MAY INTERFERE IN LOCAL FISCAL
MATTERS

1.An unmanaged public sector deficit of the national government;

2.Consultations with the presiding officers of the Senate and the House of
Representatives and the presidents of the various local leagues;

3.And the corresponding recommendation of the secretaries of the

Department of Finance, Interior and Local Government, and Budget and
Management (Pimentel, Jr. v. Aguirre, G.R. No. 132988, July 19, 2000).