CASE 2011-0057: LEAGUE OF CITIES OF THE PHILIPPINES ET AL. VS. COMELEC ET AL. (G.R. NOS. 176951, G.R. NO. 177499; G.R. No. 178056, 15 FEBRUARY 2011, BERSAMIN, J.) SUBJECTS: CREATION OF CITIES; LEGISLATIVE POWER; EQUAL PROTECTION CLAUSE. (BRIEF TITLE: LEAGUE OF CITIES ET AL VS. COMELEC ET AL.

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RESOLUTION

BERSAMIN, J.:

 

 

          For consideration of this Court are the following pleadings:

1.       Motion for Reconsideration of the “Resolution” dated August 24, 2010 dated and filed on September 14, 2010 by respondents Municipality of Baybay, et al.; and

2.       Opposition [To the “Motion for Reconsideration of the ‘Resolution’ dated August 24, 2010”].

Meanwhile, respondents also filed on September 20, 2010 a Motion to Set “Motion for Reconsideration of the ‘Resolution’ dated August 24, 2010” for Hearing.  This motion was, however, already denied by the Court En Banc.

 

A brief background —

These cases were initiated by the consolidated petitions for prohibition filed by the League of Cities of the Philippines (LCP), City of Iloilo, City of Calbayog, and Jerry P. Treñas, assailing the constitutionality of the sixteen (16) laws,[1][1] each converting the municipality covered thereby into a component city (Cityhood Laws), and seeking to enjoin the Commission on Elections (COMELEC) from conducting plebiscites pursuant to the subject laws.

In the Decision dated November 18, 2008, the Court En Banc, by a 6-5 vote,[2][2] granted the petitions and struck down the Cityhood Laws as unconstitutional for violating Sections 10 and 6, Article X, and the equal protection clause.

In the Resolution dated March 31, 2009, the Court En Banc, by a 7-5 vote,[3][3] denied the first motion for reconsideration.

On April 28, 2009, the Court En Banc issued a Resolution, with a vote of 6-6,[4][4] which denied the second motion for reconsideration for being a prohibited pleading.

In its June 2, 2009 Resolution, the Court En Banc clarified its April 28, 2009 Resolution in this wise—

As a rule, a second motion for reconsideration is a prohibited pleading pursuant to Section 2, Rule 52 of the Rules of Civil Procedure which provides that: “No second motion for reconsideration of a judgment or final resolution by the same party shall be entertained.”  Thus, a decision becomes final and executory after 15 days from receipt of the denial of the first motion for reconsideration.

However, when a motion for leave to file and admit a second motion for reconsideration is granted by the Court, the Court therefore allows the filing of the second motion for reconsideration.  In such a case, the second motion for reconsideration is no longer a prohibited pleading.

In the present case, the Court voted on the second motion for reconsideration filed by respondent cities.  In effect, the Court allowed the filing of the second motion for reconsideration.  Thus, the second motion for reconsideration was no longer a prohibited pleading.  However, for lack of the required number of votes to overturn the 18 November 2008 Decision and 31 March 2009 Resolution, the Court denied the second motion for reconsideration in its 28 April 2009 Resolution.[5][5]

Then, in another Decision dated December 21, 2009, the Court En Banc, by a vote of 6-4,[6][6] declared the Cityhood Laws as constitutional.

On August 24, 2010, the Court En Banc, through a Resolution, by a vote of 7-6,[7][7] resolved the Ad Cautelam Motion for Reconsideration and Motion to Annul the Decision of December 21, 2009, both filed by petitioners, and the Ad Cautelam Motion for Reconsideration filed by petitioners-in-intervention Batangas City, Santiago City, Legazpi City, Iriga City, Cadiz City, and Oroquieta City, reinstating the November 18, 2008 Decision.  Hence, the aforementioned pleadings.

Considering these circumstances where the Court En Banc has twice changed its position on the constitutionality of the 16 Cityhood Laws, and especially taking note of the novelty of the issues involved in these cases, the Motion for Reconsideration of the “Resolution” dated August 24, 2010 deserves favorable action by this Court on the basis of the following cogent points:

 

1.

The 16 Cityhood Bills do not violate Article X, Section 10 of the Constitution. 

         

          Article X, Section 10 provides—

Section 10.  No province, city, municipality, or barangay may be created, divided, merged, abolished, or its boundary substantially altered, except in accordance with the criteria established in the local government code and subject to approval by a majority of the votes cast in a plebiscite in the political units directly affected.

The tenor of the ponencias of the November 18, 2008 Decision and the August 24, 2010 Resolution is that the exemption clauses in the 16 Cityhood Laws are unconstitutional because they are not written in the Local Government Code of 1991 (LGC), particularly Section 450 thereof, as amended by Republic Act (R.A.) No. 9009, which took effect on June 30, 2001, viz.

Section 450. Requisites for Creation. –a) A municipality or a cluster of barangays may be converted into a component city if it has a locally generated annual income, as certified by the Department of Finance, of at least One Hundred Million Pesos (P100,000,000.00) for at least two (2) consecutive years based on 2000 constant prices, and if it has either of the following requisites:

x x x x

(c) The average annual income shall include the income accruing to the general fund, exclusive of special funds, transfers, and non-recurring income. (Emphasis supplied)

Prior to the amendment, Section 450 of the LGC required only an average annual income, as certified by the Department of Finance, of at least P20,000,000.00 for the last two (2) consecutive years, based on 1991 constant prices.

          Before Senate Bill No. 2157, now R.A. No. 9009, was introduced by Senator Aquilino Pimentel, there were 57 bills filed for conversion of 57 municipalities into component cities.  During the 11th Congress (June 1998-June 2001), 33 of these bills were enacted into law, while 24 remained as pending bills.  Among these 24 were the 16 municipalities that were converted into component cities through the Cityhood Laws.

          The rationale for the enactment of R.A. No. 9009 can be gleaned from the sponsorship speech of Senator Pimentel on Senate Bill No. 2157, to wit—

 

Senator Pimentel.  Mr. President, I would have wanted this bill to be included in the whole set of proposed amendments that we have introduced to precisely amend the Local Government Code.  However, it is a fact that there is a mad rush of municipalities wanting to be converted into cities.  Whereas in 1991, when the Local Government was approved, there were only 60 cities, today the number has increased to 85 cities, with 41 more municipalities applying for conversion to the same status.  At the rate we are going, I am apprehensive that before long this nation will be a nation of all cities and no municipalities.

It is for that reason, Mr. President, that we are proposing among other things, that the financial requirement, which, under the Local Government Code, is fixed at P20 million, be raised to P100 million to enable a municipality to have the right to be converted into a city, and the P100 million should be sourced from locally generated funds.

What has been happening, Mr. President, is, the municipalities aspiring to become cities say that they qualify in terms of financial requirements by incorporating the Internal Revenue share of the taxes of the nation on to their regularly generated revenue.  Under that requirement, it looks clear to me that practically all municipalities in this country would qualify to become cities.

It is precisely for that reason, therefore, that we are seeking the approval of this Chamber to amend, particularly Section 450 of Republic Act No. 7160, the requisite for the average annual income of a municipality to be converted into a city or cluster of barangays which seek to be converted into a city, raising that revenue requirement from P20 million to P100 million for the last two consecutive years based on 2000 constant prices.[8][8]

While R.A. No. 9009 was being deliberated upon, Congress was well aware of the pendency of conversion bills of several municipalities, including those covered by the Cityhood Laws, desiring to become component cities which qualified under the P20 million income requirement of the old Section 450 of the LGC.  The interpellation of Senate President Franklin Drilon of Senator Pimentel is revealing, thus—

THE PRESIDENT.  The Chair would like to ask for some clarificatory point.

SENATOR PIMENTEL.  Yes, Mr. President.

THE PRESIDENT.  This is just on the point of the pending bills in the Senate which propose the conversion of a number of municipalities into cities and which qualify under the present standard.

            We would like to know the view of the sponsor: Assuming that this bill becomes a law, will the Chamber apply the standard as proposed in this bill to those bills which are pending for consideration?

SENATOR PIMENTEL.  Mr. President, it might not be fair to make this bill, on the assumption that it is approved, retroact to the bills that are pending in the Senate conversion from municipalities to cities.

THE PRESIDENT.  Will there be an appropriate language crafted to reflect that view? Or does it not become a policy of the Chamber, assuming that this bill becomes a law tomorrow, that it will apply to those bills which are already approved by the House under the old version of the Local Government Code and are now pending in the Senate?  The Chair does not know if we can craft a language which will limit the application to those which are not yet in the Senate.  Or is that a policy that the Chamber will adopt?

SENATOR PIMENTEL.  Mr. President, personally, I do not think it is necessary to put that provision because what we are saying here will form part of the interpretation of this bill.  Besides, if there is no retroactivity clause, I do not think that the bill would have any retroactive effect.

THE PRESIDENT.  So the understanding is that those bills which are already pending in the Chamber will not be affected.

SENATOR PIMENTEL.  These will not be affected, Mr. President.

THE PRESIDENT.  Thank you Mr. Chairman.[9][9]

Clearly, based on the above exchange, Congress intended that those with pending cityhood bills during the 11th Congress would not be covered by the new and higher income requirement of P100 million imposed by R.A. No. 9009.  When the LGC was amended by R.A. No. 9009, the amendment carried with it both the letter and the intent of the law, and such were incorporated in the LGC by which the compliance of the Cityhood Laws was gauged.

          Notwithstanding that both the 11th and 12th Congress failed to act upon the pending cityhood bills, both the letter and intent of Section 450 of the LGC, as amended by R.A. No. 9009, were carried on until the 13th Congress, when the Cityhood Laws were enacted.  The exemption clauses found in the individual Cityhood Laws are the express articulation of that intent to exempt respondent municipalities from the coverage of R.A. No. 9009.

          Even if we were to ignore the above quoted exchange between then Senate President Drilon and Senator Pimentel, it cannot be denied that Congress saw the wisdom of exempting respondent municipalities from complying with the higher income requirement imposed by the amendatory R.A. No. 9009.  Indeed, these municipalities have proven themselves viable and capable to become component cities of their respective provinces.  It is also acknowledged that they were centers of trade and commerce, points of convergence of transportation, rich havens of agricultural, mineral, and other natural resources, and flourishing tourism spots.  In this regard, it is worthy to mention the distinctive traits of each respondent municipality, viz—

 

Batac, Ilocos Norte – It is the biggest municipality of the 2nd District of Ilocos Norte, 2nd largest and most progressive town in the province of Ilocos Norte and the natural convergence point for the neighboring towns to transact their commercial ventures and other daily activities.  A growing metropolis, Batac is equipped with amenities of modern living like banking institutions, satellite cable systems, telecommunications systems.  Adequate roads, markets, hospitals, public transport systems, sports, and entertainment facilities. [Explanatory Note of House Bill No. 5941, introduced by Rep. Imee R. Marcos.]

 

El Salvador, Misamis Oriental – It is located at the center of the Cagayan-Iligan Industrial Corridor and home to a number of industrial companies and corporations.  Investment and financial affluence of El Salvador is aptly credited to its industrious and preserving people.  Thus, it has become the growing investment choice even besting nearby cities and municipalities.  It is home to Asia Brewery as distribution port of their product in Mindanao.  The Gokongwei Group of Companies is also doing business in the area.  So, the conversion is primarily envisioned to spur economic and financial prosperity to this coastal place in North-Western Misamis Oriental.  [Explanatory Note of House Bill No. 6003, introduced by Rep. Augusto H. Bacullo.]

Cabadbaran, Agusan del Norte – It is the largest of the eleven (11) municipalities in the province of Agusan del Norte.  It plays strategic importance to the administrative and socio-economic life and development of Agusan del Norte.  It is the foremost in terms of trade, commerce, and industry.  Hence, the municipality was declared as the new seat and capital of the provincial government of Agusan del Norte pursuant to Republic Act No. 8811 enacted into law on August 16, 2000.  Its conversion will certainly promote, invigorate, and reinforce the economic potential of the province in establishing itself as an agro-industrial center in the Caraga region and accelerate the development of the area.  [Explanatory Note of House Bill No. 3094, introduced by Rep. Ma. Angelica Rosedell M. Amante.]

 

Borongan, Eastern Samar – It is the capital town of Eastern Samar and the development of Eastern Samar will depend to a certain degree of its urbanization.  It will serve as a catalyst for the modernization and progress of adjacent towns considering the frequent interactions between the populace.  [Explanatory Note of House Bill No. 2640, introduced by Rep. Marcelino C. Libanan.]

 

Lamitan, Basilan – Before Basilan City was converted into a separate province, Lamitan was the most progressive part of the city.  It has been for centuries the center of commerce and the seat of the Sultanate of the Yakan people of Basilan.  The source of its income is agro-industrial and others notably copra, rubber, coffee and host of income generating ventures.  As the most progressive town in Basilan, Lamitan continues to be the center of commerce catering to the municipalities of Tuburan, Tipo-Tipo and Sumisip.  [Explanatory Note of House Bill No. 5786, introduced by Rep. Gerry A. Salapuddin.]

 

Catbalogan, Samar – It has always been the socio-economic-political capital of the Island of Samar even during the Spanish era.  It is the seat of government of the two congressional districts of Samar.  Ideally located at the crossroad between Northern and Eastern Samar, Catbalogan also hosts trade and commerce activates among the more prosperous cities of the Visayas like Tacloban City, Cebu City and the cities of Bicol region.  The numerous banks and telecommunication facilities showcases the healthy economic environment of the municipality.  The preeminent and sustainable economic situation of Catbalogan has further boosted the call of residents for a more vigorous involvement of governance of the municipal government that is inherent in a city government.  [Explanatory Note of House Bill No. 2088, introduced by Rep. Catalino V. Figueroa.]

 

Bogo, Cebu – Bogo is very qualified for a city in terms of income, population and area among others.  It has been elevated to the Hall of Fame being a five-time winner nationwide in the clean and green program.  [Explanatory Note of House Bill No. 3042, introduced by Rep. Clavel A. Martinez.]

 

Tandag, Surigao del Sur – This over 350 year old capital town the province has long sought its conversion into a city that will pave the way not only for its own growth and advancement but also help in the development of its neighboring municipalities and the province as a whole.  Furthermore, it can enhance its role as the province’s trade, financial and government center.  [Explanatory Note of House Bill No. 5940, introduced by Rep. Prospero A. Pichay, Jr.]

 

Bayugan, Agusan del Sur – It is a first class municipality and the biggest in terms of population in the entire province.  It has the most progressive and thickly populated area among the 14 municipalities that comprise the province.  Thus, it has become the center for trade and commerce in Agusan del Sur.  It has a more developed infrastructure and facilities than other municipalities in the province.  [Explanatory Note of House Bill No. 1899, introduced by Rep. Rodolfo “Ompong” G. Plaza.]

 

Carcar, Cebu – Through the years, Carcar metamorphosed from rural to urban and now boast of its manufacturing industry, agricultural farming, fishing and prawn industry and its thousands of large and small commercial establishments contributing to the bulk of economic activities in the municipality.  Based on consultation with multi-sectoral groups, political and non-government agencies, residents and common folk in Carcar, they expressed their desire for the conversion of the municipality into a component city.  [Explanatory Note of House Bill No. 3990, introduced by Rep. Eduardo R. Gullas.]

 

Guihulngan, Negros Oriental – Its population is second highest in the province, next only to the provincial capital and higher than Canlaon City and Bais City.  Agriculture contributes heavily to its economy.  There are very good prospects in agricultural production brought about by its favorable climate.  It has also the Tanon Strait that provides a good fishing ground for its numerous fishermen.  Its potential to grow commercially is certain.  Its strategic location brought about by its existing linkage networks and the major transportation corridors traversing the municipality has established Guihulngan as the center of commerce and trade in this part of Negros Oriental with the first congressional district as its immediate area of influence.  Moreover, it has beautiful tourist spots that are being availed of by local and foreign tourists.  [Explanatory Note of House Bill No. 3628, introduced by Rep. Jacinto V. Paras.]

 

Tayabas, Quezon – It flourished and expanded into an important politico-cultural center in [the] Tagalog region.  For 131 years (1179-1910), it served as the cabecera of the province which originally carried the cabecera’s own name, Tayabas.  The locality is rich in culture, heritage and trade.  It was at the outset one of the more active centers of coordination and delivery of basic, regular and diverse goods and services within the first district of Quezon Province.  [Explanatory Note of House Bill No. 3348, introduced by Rep. Rafael P. Nantes.]

 

Tabuk, Kalinga – It not only serves as the main hub of commerce and trade, but also the cultural center of the rich customs and traditions of the different municipalities in the province.  For the past several years, the income of Tabuk has been steadily increasing, which is an indication that its economy is likewise progressively growing.  [Explanatory Note of House Bill No. 3068, introduced by Rep. Laurence P. Wacnang.]

Available information on Baybay, Leyte; Mati, Davao Oriental; and Naga, Cebu shows their economic viability, thus:

Covering an area of 46,050 hectares, Baybay [Leyte] is composed of 92 barangays, 23 of which are in the poblacion.  The remaining 69 are rural barangays.  Baybay City is classified as a first class city.  It is situated on the western coast of the province of Leyte.  It has a Type 4 climate, which is generally wet.  Its topography is generally mountainous in the eastern portion as it slopes down west towards the shore line.  Generally an agricultural city, the common means of livelihood are farming and fishing.  Some are engaged in hunting and in forestall activities.  The most common crops grown are rice, corn, root crops, fruits, and vegetables.  Industries operating include the Specialty Products Manufacturing, Inc. and the Visayan Oil Mill.  Various cottage industries can also be found in the city such as bamboo and rattan craft, ceramics, dress-making, fiber craft, food preservation, mat weaving, metal craft, fine Philippine furniture manufacturing and other related activities.  Baybay has great potential as a tourist destination, especially for tennis players.  It is not only rich in biodiversity and history, but it also houses the campus of the Visayas State University (formerly the Leyte State University/Visayas State College of Agriculture/Visayas Agricultural College/Baybay National Agricultural School/Baybay Agricultural High School and the Jungle Valley Park.)  Likewise, it has river systems fit for river cruising, numerous caves for spelunking, forests, beaches, and marine treasures.  This richness, coupled with the friendly Baybayanos, will be an element of a successful tourism program.  Considering the role of tourism in development, Baybay City intends to harness its tourism potential. (<http://en.wikipedia.org/wiki/Baybay City> visited September 19, 2008)

 

Mati [Davao Oriental] is located on the eastern part of the island of Mindanao.  It is one hundred sixty-five (165) kilometers away from Davao City, a one and a half-hour drive from Tagum City.  Visitors can travel from Davao City through the Madaum diversion road, which is shorter than taking the Davao-Tagum highway.  Travels by air and sea are possible, with the existence of an airport and seaport.  Mati boasts of being the coconut capital of Mindanao if not the whole country.  A large portion of its fertile land is planted to coconuts, and a significant number of its population is largely dependent on it.  Other agricultural crops such as mango, banana, corn, coffee and cacao are also being cultivated, as well as the famous Menzi pomelo and Valencia oranges.  Mati has a long stretch of shoreline and one can find beaches of pure, powder-like white sand.  A number of resorts have been developed and are now open to serve both local and international tourists.  Some of these resorts are situated along the coast of Pujada Bay and the Pacific Ocean.  Along the western coast of the bay lies Mt. Hamiguitan, the home of the pygmy forest, where bonsai plants and trees grow, some of which are believed to be a hundred years old or more.  On its peak is a lake, called “Tinagong Dagat,” or hidden sea, so covered by dense vegetation a climber has to hike trails for hours to reach it.  The mountain is also host to rare species of flora and fauna, thus becoming a wildlife sanctuary for these life forms. (<http://mati.wetpain.com/?t=anon>  accessed on September 19, 2008.)

Mati is abundant with nickel, chromite, and copper.  Louie Rabat, Chamber President of the Davao Oriental Eastern Chamber of Commerce and Industry, emphasized the big potential of the mining industry in the province of Davao Oriental.  As such, he strongly recommends Mati as the mining hub in the Region.

(<http://www.pia.gov.ph/default.asp?m=12&sec=reader&rp=1&fi=p080115.htm&no.=9&date, accessed on September 19, 2008)

 

Naga [Cebu]: Historical Background—In the early times, the place now known as Naga was full of huge trees locally called as “Narra.”  The first settlers referred to this place as Narra, derived from the huge trees, which later simply became Naga.  Considered as one of the oldest settlements in the Province of Cebu, Naga became a municipality on June 12, 1829.  The municipality has gone through a series of classifications as its economic development has undergone changes and growth.  The tranquil farming and fishing villages of the natives were agitated as the Spaniards came and discovered coal in the uplands.  Coal was the first export of the municipality, as the Spaniards mined and sent it to Spain.  The mining industry triggered the industrial development of Naga.  As the years progressed, manufacturing and other industries followed, making Naga one of the industrialized municipalities in the Province of Cebu.

Class of Municipality                             1st class

Province                                               Cebu

Distance from Cebu City                       22 kms.

Number of Barangays                           28

No. of Registered Voters                      44,643 as of May 14, 2007

Total No. of Precincts                           237 (as of May 14, 2007)

Ann. Income (as of Dec. 31, 2006)       Php112,219,718.35                                                                       Agricultural, Industrial, Agro-Industrial, Mining Product

(<http://www.nagacebu.com/index.php?option=com.content&view=article id=53:naga-facts-and-figures&catid=51:naga-facts-and-figures&Itemid=75> visited September 19, 2008)

          The enactment of the Cityhood Laws is an exercise by Congress of its legislative power.  Legislative power is the authority, under the Constitution, to make laws, and to alter and repeal them.[10][10]  The Constitution, as the expression of the will of the people in their original, sovereign, and unlimited capacity, has vested this power in the Congress of the Philippines.  The grant of legislative power to Congress is broad, general, and comprehensive.  The legislative body possesses plenary powers for all purposes of civil government.  Any power, deemed to be legislative by usage and tradition, is necessarily possessed by Congress, unless the Constitution has lodged it elsewhere.  In fine, except as limited by the Constitution, either expressly or impliedly, legislative power embraces all subjects, and extends to matters of general concern or common interest.[11][11]

          Without doubt, the LGC is a creation of Congress through its law-making powers.  Congress has the power to alter or modify it as it did when it enacted R.A. No. 9009.  Such power of amendment of laws was again exercised when Congress enacted the Cityhood Laws.  When Congress enacted the LGC in 1991, it provided for quantifiable indicators of economic viability for the creation of local government units—income, population, and land area.  Congress deemed it fit to modify the income requirement with respect to the conversion  of municipalities into component cities when

it enacted R.A. No. 9009, imposing an amount of P100 million, computed only from locally-generated sources.  However, Congress deemed it wiser to exempt respondent municipalities from such a belatedly imposed modified income requirement in order to uphold its higher calling of putting flesh and blood to the very intent and thrust of the LGC, which is countryside development and autonomy, especially accounting for these municipalities as engines for economic growth in their respective provinces.

          Undeniably, R.A. No. 9009 amended the LGC.  But it is also true that, in effect, the Cityhood Laws amended R.A. No. 9009 through the exemption clauses found therein.  Since the Cityhood Laws explicitly exempted the concerned municipalities from the amendatory R.A. No. 9009, such Cityhood Laws are, therefore, also amendments to the LGC itself.  For this reason, we reverse the November 18, 2008 Decision and the August 24, 2010 Resolution on their strained and stringent view that the Cityhood Laws, particularly their exemption clauses, are not found in the LGC.

2.

The Cityhood Laws do not violate Section 6, Article X and the equal protection clause of the Constitution.

 

          Both the November 18, 2008 Decision and the August 24, 2010 Resolution impress that the Cityhood Laws violate the equal protection clause enshrined in the Constitution.  Further, it was also ruled that Section 6, Article X was violated because the Cityhood Laws infringed on the “just share” that petitioner and petitioners-in-intervention shall receive from the national taxes (IRA) to be automatically released to them.

          Upon more profound reflection and deliberation, we declare that there was valid classification, and the Cityhood Laws do not violate the equal protection clause.

As this Court has ruled, the equal protection clause of the 1987 Constitution permits a valid classification, provided that it: (1) rests on substantial distinctions; (2) is germane to the purpose of the law; (3) is not limited to existing conditions only; and (4) applies equally to all members of the same class.[12][12]

          The petitioners argue that there is no substantial distinction between municipalities with pending cityhood bills in the 11th Congress and municipalities that did not have pending bills, such that the mere pendency of a cityhood bill in the 11th Congress is not a material difference to distinguish one municipality from another for the purpose of the income requirement.  This contention misses the point.

          It should be recalled from the above quoted portions of the interpellation by Senate President Drilon of Senator Pimentel that the purpose of the enactment of R.A. No 9009 was merely to stop the “mad rush of municipalities wanting to be converted into cities” and the apprehension that before long the country will be a country of cities and without municipalities.  It should be pointed out that the imposition of the P100 million average annual income requirement for the creation of component cities was arbitrarily made.  To be sure, there was no evidence or empirical data, such as inflation rates, to support the choice of this amount.  The imposition of a very high income requirement of P100 million, increased from P20 million, was simply to make it extremely difficult for municipalities to become component cities.  And to highlight such arbitrariness and the absurdity of the situation created thereby, R.A. No. 9009 has, in effect, placed component cities at a higher standing than highly urbanized cities under Section 452 of the LGC, to wit—

            Section 452. Highly Urbanized Cities. – (a) Cities with a minimum population of two hundred thousand (200,000) inhabitants, as certified by the National Statistics Office, and with the latest annual income of at least Fifty Million Pesos (P50,000,000.00) based on 1991 constant prices, as certified by the city treasurer, shall be classified as highly urbanized cities.

            (b)  Cities which do not meet above requirements shall be considered component cities of the province in which they are geographically located.  (Emphasis supplied)

          The P100 million income requirement imposed by R.A. No. 9009, being an arbitrary amount, cannot be conclusively said to be the only amount “sufficient, based on acceptable standards, to provide for all essential    government    facilities    and    services   and    special   functions

commensurate with the size of its population,” per Section 7[13][13] of the LGC.  It was imposed merely because it is difficult to comply with.  While it could be argued that P100 million, being more than P20 million, could, of course, provide the essential government facilities, services, and special functions vis-à-vis the population of a municipality wanting to become a component city, it cannot be said that the minimum amount of P20 million would be insufficient.  This is evident from the existing cities whose income, up to now, do not comply with the P100 million income requirement, some of which have lower than the P20 million average annual income.  Consider the list[14][14] below—

CITY AVERAGE ANNUAL INCOME
1.   Marawi City 5,291,522.10
2.   Palayan City 6,714,651.77
3.   Sipalay City 9,713,120.00
4.   Canlaon City 13,552,493.79
5.   Himamaylan City 15,808,530.00
6.   Isabela City 16,811,246.79
7.   Munoz City 19,693,358.61
8.   Dapitan City 20,529,181.08
9.   Tangub City 20,943,810.04
10. Bayawan City 22,943,810.04
11. Island Garden City of Samal 23,034,731.83
12. Tanjay City 23,723,612.44
13. Tabaco City 24,152,853.71
14. Oroquieta City 24,279,966.51
15. Ligao City 28,326,745.86
16. Sorsogon City 30,403,324.59
17. Maasin City 30,572,113.65
18. Escalante City 32,113,970.00
19. Iriga City 32,757,871.44
20. Gapan City 34,254,986.47
21. Candon City 36,327,705.86
22. Gingoog City 37,327,705.86
23. Masbate City 39,454,508.28
24. Passi City 40,314,620.00
25. Calbayog City 40,943,128.73
26. Calapan City 41,870,239.21
27. Cadiz City 43,827,060.00
28. Alaminos City 44,352,501.00
29. Bais City 44, 646,826.48
30. San Carlos City 46,306,129.13
31. Silay City 47,351,730.00
32. Bislig City 47,360,716.24
33. Tacurong City 49,026,281.56
34. Talisay City (Negros Occidental) 52,609,790.00
35. Kabankalan City 53,560,580.00
36. Malaybalay City 54,423,408.55
37. La Carlota City 54,760,290.00
38. Vigan City 56,831,797.19
39. Balanga City 61,556,700.49
40. Sagay City 64,266,350.00
41. Cavite City 64,566,079.05
42. Koronadal City 66,231,717.19
43. Cotabato City 66,302,114.52
44. Toledo City 70,157,331.12
45. San Jose City 70,309,233.43
46. Danao City 72,621,955.30
47. Bago City 74,305,000.00
48. Valencia City 74,557,298.92
49. Victorias City 75,757,298.92
50. Cauayan City 82,949,135.46
51. Santiago City 83,816,025.89
52. Roxas City 85,397,830.00
53. Dipolog City 85,503,262.85
54. Trece Martires City 87,413,786.64
55. Talisay City (Cebu) 87,964,972.97
56. Ozamis city 89,054,056.12
57. Surigao City 89,960,971.33
58. Panabo City 91,425,301.39
59. Digos City 92,647,699.13

 

The undeniable fact that these cities remain viable as component cities of their respective provinces emphasizes the arbitrariness of the amount of P100 million as the new income requirement for the conversion of municipalities into component cities.  This arbitrariness can also be clearly gleaned from the respective distinctive traits and level of economic development of the individual respondent municipalities as above submitted.

          Verily, the determination of the existence of substantial distinction with respect to respondent municipalities does not simply lie on the mere pendency of their cityhood bills during the 11th Congress.  This Court sees the bigger picture.  The existence of substantial distinction with respect to respondent municipalities covered by the Cityhood Laws is measured by the purpose of the law, not by R.A. No. 9009, but by the very purpose of the LGC, as provided in its Section 2 (a), thus—

            SECTION 2. Declaration of Policy.—(a) It is hereby declared the policy of the State that the territorial and political subdivisions of the State shall enjoy genuine and meaningful local autonomy to enable them to attain their fullest development as self-reliant communities and make them more effective partners in the attainment of national goals.  Toward this end, the State shall provide for a more responsive and accountable local government structure instituted through a system of decentralization whereby local government units shall be given more powers, authority, responsibilities and resources.  The process of decentralization shall proceed from the National Government to the local government units.

          Indeed, substantial distinction lies in the capacity and viability of respondent municipalities to become component cities of their respective provinces.  Congress, by enacting the Cityhood Laws, recognized this capacity and viability of respondent municipalities to become the State’s partners in accelerating economic growth and development in the provincial regions, which is the very thrust of the LGC, manifested by the pendency of their cityhood bills during the 11th Congress and their relentless pursuit for cityhood up to the present.  Truly, the urgent need to become a component city arose way back in the 11th Congress, and such condition continues to exist.

          Petitioners in these cases complain about the purported reduction of their “just share” in the IRA.  To be sure, petitioners are entitled to a “just share,” not a specific amount.  But the feared reduction proved to be false when, after the implementation of the Cityhood Laws, their respective shares increased, not decreased.  Consider the table[15][15] below—

CITY CY 2006 IRA

(Before Implementation of Sixteen [16] Cityhood Laws)

CY 2008 IRA

(Actual Release After Implementation of Sixteen [16] Cityhood Laws)

Bais 219,338,056.00 242,193,156.00
Batangas 334,371,984.00 388,871,770.00
Bayawan 353,150,158.00 388,840,062.00
Cadiz 329,491,285.00 361,019,211.00
Calapan 227,772,199.00 252,587,779.00
Calbayog 438,603,378.00 485,653,769.00
Cauayan 250,477,157.00 277,120,828.00
Gen. Santos 518,388,557.00 631,864,977.00
Gingoog 314,425,637.00 347,207,725.00
Himamaylan 248,154,381.00 277,532,458.00
Iloilo 358,394,268.00 412,506,278.00
Iriga 183,132,036.00 203,072,932.00
Legaspi 235,314,016.00 266,537,785.00
Ligao 215,608,112.00 239,696,441.00
Oroquieta 191,803,213.00 211,449,720.00
Pagadian 292,788,255.00 327,401,672.00
San Carlos 239,524,249.00 260,515,711.00
San Fernando 182,320,356.00 204,140,940.00
Santiago 508,326,072.00 563,679,572.00
Silay 216,372,314.00 241,363,845.00
Surigao 233,968,119.00 260,708,071.00
Tacurong 179,795,271.00 197,880,665.00
Tagaytay 130,159,136.00 152,445,295.00
Tarlac 348,186,756.00 405,611,581.00
Tangub 162,248,610.00 180,640,621.00
Urdaneta 187,721,031.00 207,129,386.00
Victorias 176,367,959.00 194,162,687.00
Zamboanga 918,013,016.00 1,009,972,704.00

 

What these petitioner cities were stating as a reduction of their respective IRA shares was based on a computation of what they would receive if respondent municipalities were not to become component cities at all.  Of course, that would mean a bigger amount to which they have staked their claim.  After considering these, it all boils down to money and how much more they would receive if respondent municipalities remain as municipalities and not share in the 23% fixed IRA from the national government for cities. 

Moreover, the debates in the Senate on R.A. No. 9009, should prove enlightening:

 

SENATOR SOTTO.  Mr. President, we just want to be enlightened again on the previous qualification and the present one being proposed.  Before there were three…

SENATOR PIMENTEL.  There are three requisites for a municipality to become a city.  Let us start with the finance.

SENATOR SOTTO.  Will the distinguished sponsor please refresh us?  I used to be the chairman of the Committee on Local Government, but the new job that was given to me by the Senate has erased completely my memory as far as the Local Government Code is concerned.

SENATOR PIMENTEL.  Yes, Mr. President, with pleasure.  There are three requirements.  One is financial.

SENATOR SOTTO.  All right.  It used to be P20 million.

SENATOR PIMENTEL.  It is P20 million.  Now we are raising it to P100 million of locally generated funds.

SENATOR SOTTO.  In other words, the P20 million before includes the IRA.

SENATOR PIMENTEL.  No, Mr. President.

SENATOR SOTTO.  It should not have been included?

SENATOR PIMENTEL.  The internal revenue share should never have been included.  That was not the intention when we first crafted the Local Government Code.  The financial capacity was supposed to be demonstrated by the municipality wishing to become a city by its own effort, meaning to say, it should not rely on the internal revenue share that comes from the government.  Unfortunately, I think what happened in past conversions of municipalities into cities was, the Department of Budget and Management, along with the Department of Finance, had included the internal revenue share as a part of the municipality, demonstration that they are now financially capable and can measure up to the requirement of the Local Government Code of having a revenue of at least P20 million.

SENATOR SOTTO.  I am glad that the sponsor, Mr. President, has spread that into the Record because otherwise, if he did not mention the Department of Finance and the Department of Budget and Management, then I would have been blamed for the misinterpretation.  But anyway, the gentleman is correct.  That was the interpretation given to us during the hearings.

                        So now, from P20 million, we make it P100 million from locally generated income as far as population is concerned.

SENATOR PIMENTEL.  As far as population is concerned, there will be no change, Mr. President.  Still 150,000.

SENATOR SOTTO.  Still 150,000?

SENATOR PIMENTEL.  Yes.

SENATOR SOTTO.  And then the land area?

SENATOR PIMENTEL.  As to the land area, there is no change; it is still 100 square kilometers.

SENATOR SOTTO.  But before it was “either/or”?

SENATOR PIMENTEL.  That is correct.  As long as it has one of the three requirements, basically, as long as it meets the financial requirement, then it may meet the territorial requirement or the population requirement.

SENATOR SOTTO.  So, it remains “or”?

SENATOR PIMENTEL.  We are now changing it into AND.

SENATOR SOTTO.  AND?

SENATOR PIMENTEL.  Yes.

SENATOR SOTTO.  I see.

SENATOR PIMENTEL.  That is the proposal, Mr. President.  In other words…

SENATOR SOTTO.  Does the gentleman not think there will no longer be any municipality that will qualify, Mr. President?

SENATOR PIMENTEL.  There may still be municipalities which can qualify, but it will take a little time.  They will have to produce more babies.  I do not know—expand their territories, whatever, by reclamation or otherwise.  But the whole proposal is geared towards making it difficult for municipalities to convert into cities.

 

                        On the other hand, I would like to advert to the fact that in the amendments that we are proposing for the entire Local Government Code, we are also raising the internal revenue share of the municipalities.

SENATOR SOTTO.  I see.

SENATOR PIMENTEL.  So that, more or less, hindi naman sila dehado in this particular instance.

SENATOR SOTTO.  Well, then, because of that information, Mr. President, I throw my full support behind the measure.

                        Thank you, Mr. President.

SENATOR PIMENTEL.  Thank you very much, Mr. President. (Emphasis supplied)[16][16]

From the foregoing, the justness in the act of Congress in enacting the Cityhood Laws becomes obvious, especially considering that 33 municipalities were converted into component cities almost immediately prior to the enactment of R.A. No. 9009.  In the enactment of the Cityhood Laws, Congress merely took the 16 municipalities covered thereby from the disadvantaged position brought about by the abrupt increase in the income requirement of R.A. No. 9009, acknowledging the “privilege” that they have already given to those newly-converted component cities, which prior to the enactment of R.A. No. 9009, were undeniably in the same footing or “class” as the respondent municipalities.  Congress merely recognized the capacity and readiness of respondent municipalities to become component cities of their respective provinces. 

Petitioners complain of the projects that they would not be able to pursue and the expenditures that they would not be able to meet, but totally ignored the respondent municipalities’ obligations arising from the contracts they have already entered into, the employees that they have already hired, and the projects that they have already initiated and completed as component cities.  Petitioners have completely overlooked the need of respondent municipalities to become effective vehicles intending to accelerate economic growth in the countryside.  It is like the elder siblings wanting to kill the newly-borns so that their inheritance would not be diminished. 

Apropos is the following parable:

There was a landowner who went out at dawn to hire workmen for his vineyard.  After reaching an agreement with them for the usual daily wage, he sent them out to his vineyard.  He came out about midmorning and saw other men standing around the marketplace without work, so he said to them, “You too go along to my vineyard and I will pay you whatever is fair.”  They went.  He came out again around noon and mid-afternoon and did the same.  Finally, going out in late afternoon he found still others standing around.  To these he said, “Why have you been standing here idle all day?” “No one has hired us,” they told him.  He said, “You go to the vineyard too.”  When evening came, the owner of the vineyard said to his foreman, “Call the workmen and give them their pay, but begin with the last group and end with the first.”  When those hired late in the afternoon came up they received a full day’s pay, and when the first group appeared they thought they would get more, yet they received the same daily wage.  Thereupon they complained to the owner, “This last group did only an hour’s work, but you have paid them on the same basis as us who have worked a full day in the scorching heat.”  “My friend,” he said to one in reply, “I do you no injustice.  You agreed on the usual wage, did you not?  Take your pay and go home.  I intend to give this man who was hired last the same pay as you.  I am free to do as I please with my money, am I not? Or are you envious because I am generous?”[17][17]

Congress, who holds the power of the purse, in enacting the Cityhood Laws, only sought the well-being of respondent municipalities, having seen their respective capacities to become component cities of their provinces, temporarily stunted by the enactment of R.A. No. 9009.  By allowing respondent municipalities to convert into component cities, Congress desired only to uphold the very purpose of the LGC, i.e., to make the local government units “enjoy genuine and meaningful local autonomy to enable them to attain their fullest development as self-reliant communities and make them more effective partners in the attainment of national goals,” which is the very mandate of the Constitution.

Finally, we should not be restricted by technical rules of procedure at the expense of the transcendental interest of justice and equity.  While it is true that litigation must end, even at the expense of errors in judgment, it is nobler rather for this Court of last resort, as vanguard of truth, to toil in order to dispel apprehensions and doubt, as the following pronouncement of this Court instructs:

The right and power of judicial tribunals to declare whether enactments of the legislature exceed the constitutional limitations and are invalid has always been considered a grave responsibility, as well as a solemn duty.  The courts invariably give the most careful consideration to questions involving the interpretation and application of the Constitution, and approach constitutional questions with great deliberation, exercising their power in this respect with the greatest possible caution and even reluctance; and they should never declare a statute void, unless its invalidity is, in their judgment, beyond reasonable doubt.  To justify a court in pronouncing a legislative act unconstitutional, or a provision of a state constitution to be in contravention of the Constitution x x x, the case must be so clear to be free from doubt, and the conflict of the statute with the constitution must be irreconcilable, because it is but a decent respect to the wisdom, the integrity, and the patriotism of the legislative body by which any law is passed to presume in favor of its validity until the contrary is shown beyond reasonable doubt.  Therefore, in no doubtful case will the judiciary pronounce a legislative act to be contrary to the constitution.  To doubt the constitutionality of a law is to resolve the doubt in favor of its validity.[18][18]

WHEREFORE, the Motion for Reconsideration of the “Resolution” dated August 24, 2010, dated and filed on September 14, 2010 by respondents Municipality of Baybay, et al. is GRANTED.  The Resolution dated August 24, 2010 is REVERSED and SET ASIDE.   The Cityhood Laws—Republic Acts Nos. 9389, 9390, 9391, 9392, 9393, 9394, 9398, 9404, 9405, 9407, 9408, 9409, 9434, 9435, 9436, and 9491—are declared CONSTITUTIONAL.

            SO ORDERED.

                                                LUCAS P. BERSAMIN

                                                Associate Justice

WE CONCUR:

 

RENATO C. CORONA

Chief Justice

 

ANTONIO T. CARPIO

Associate Justice

 

CONCHITA CARPIO MORALES

Associate Justice

 

PRESBITERO J. VELASCO, JR.

Associate Justice

 

ANTONIO EDUARDO B. NACHURA

Associate Justice

 

TERESITA J. LEONARDO-DE CASTRO

Associate Justice

 

ARTURO D. BRION

Associate Justice

 

 

DIOSDADO M. PERALTA

Associate Justice

 

MARIANO C. DEL CASTILLO

Associate Justice

 

 

 

 

ROBERTO A. ABAD

Associate Justice

 

 

 

 

MARTIN S. VILLARAMA, JR.

Associate Justice

 

JOSE PORTUGAL PEREZ

Associate Justice

 

JOSE CATRAL MENDOZA

Associate Justice

 

 

 

MARIA LOURDES P. A. SERENO

Associate Justice

 

 

C E R T I F I C A T I O N

          Pursuant to Section 13, Article VIII of the Constitution, I certify that the conclusions in the above resolution had been reached in consultation before the case was assigned to the writer of the opinion of the Court.

 

                                                RENATO C. CORONA

                                                Chief Justice

 


 


[1][1]   Republic Acts 9389 [Baybay City, Leyte], 9390 [Bogo City, Cebu], 9391 [Catbalogan City, Samar], 9392 [Tandag City, Surigao del Sur], 9393 [Lamitan City, Basilan], 9394 [Borongan City, Samar], 9398 [Tayabas City, Quezon], 9404 [Tabuk City, Kalinga], 9405 [Bayugan City, Agusan del Sur], 9407 [Batac City, Ilocos Norte], 9408 [Mati City, Davao Oriental], 9409 [Guihulngan City, Negros Oriental], 9434 [Cabadbaran City, Agusan del Norte], 9435 [El Salvador City, Misamis Oriental], 9436 [Carcar City, Cebu], and 9491 [Naga City, Cebu].

[2][2]     Penned by J. Carpio, with JJ. Quisumbing, Austria-Martinez, Carpio-Morales, Velasco, Jr., and Brion, concurring; dissenting, J. Reyes, joined by JJ. Corona, Azcuna, Chico-Nazario, and Leonardo-De Castro; C.J. Puno, and JJ. Nachura and Tinga took no part; J. Ynares-Santiago was on leave.

[3][3]    Justice Velasco, Jr. wrote a Dissenting Opinion, joined by Justices Ynares-Santiago, Corona, Chico-Nazario, and Leonardo-De Castro.  Chief Justice Puno and Justice Nachura took no part.

[4][4]    Justice Velasco, Jr. wrote a Dissenting Opinion, joined by Justices Ynares-Santiago, Corona, Chico-Nazario, Leonardo-De Castro, and Bersamin. Chief Justice Puno and Justice Nachura took no part.  Justice Quisumbing was on leave.

[5][5]     Citations omitted.

[6][6]   Penned by J. Velasco, Jr., with JJ. Corona, Leonardo-De Castro, Bersamin, Abad, and Villarama concurring; dissenting, J. Carpio, joined by JJ. Carpio-Morales, Brion, and Peralta; C.J. Puno and JJ. Nachura and Del Castillo took no part.

[7][7]   Penned by J. Carpio, with JJ. Carpio-Morales, Brion,  Peralta, Villarama, Mendoza, and Sereno, concurring; dissenting,, J. Velasco, Jr., joined by C.J. Corona, and JJ. Leonardo-De Castro, Bersamin, Abad, and Perez; JJ. Nachura and  Del Castillo took no part.

[8][8]     II Record, Senate, 13th Congress, p. 164 (October 5, 2000); rollo (G.R. No. 176951), Vol. 5, p. 3765.

[9][9]     Id. at 167-168; id. at 3768-3769.

[10][10]    Review Center Association of the Philippines v. Ermita, G.R. No. 180046, April 2, 2009, 583 SCRA 428, 450, citing Kilusang Mayo Uno v. Director-General, National Economic Development Authority, G.R. No. 167798, April 19, 2006, 487 SCRA 623.

[11][11]     Id., citing Ople v. Torres, 354 Phil. 948 (1998).

[12][12]    De Guzman, Jr. v. Commission on Elections, 391 Phil. 70, 79 (2000); Tiu v. Court of Tax Appeals, 361 Phil. 229, 242 (1999).

[13][13]    SECTION 7. Creation and Conversion. As a general rule, the creation of a local government unit or its conversion from one level to another level shall be based on verifiable indicators of viability and projected capacity to provide services, to wit:

(a)     Income. — It must be sufficient, based on acceptable standards, to provide for all essential government facilities and services and special functions commensurate with the size of its population, as expected of the local government unit concerned;

(b)     Population .— It shall be determined as the total number of inhabitants within the territorial jurisdiction of the local government unit concerned; and

(c)     Land Area .— It must be contiguous, unless it comprises two (2) or more islands or is separated by a local government unit independent of the others; properly identified by metes and bound with technical descriptions; and sufficient to provide for such basic services and facilities to meet the requirements of its populace.

Compliance with the foregoing indicators shall be attested to by the Department of Finance (DOF), the National Statistics Office (NSO), and the Lands Management Bureau (LMB) of the Department of Environment and Natural Resources (DENR). (Emphasis supplied.)

[14][14]    The figures reflect the actual income of the cities for 2006.  If R.A. No. 9009 is to be applied such that the figures are expressed in 2000 constant prices, the income of the cities will even be lower. (Certification from the Bureau of Local Government Finance dated December 5, 2008; rollo [G.R. No. 176951], Vol. 5, pp. 3731-3734.)

[15][15]    Based on the letter dated December 9, 2008 of the Department of Budget and Management; rollo (G.R. No. 176951), Vol. 5, pp. 3978-3986.

[16][16]    Committee Amendments re S. No. 2157, Records of the Senate, Vol. II, No. 24, October 5, 2000, pp. 165-166; id. at 3766-3767.

[17][17]     Mat. 20: 1-15.

[18][18]    Churchill v. Rafferty, 32 Phil. 580, 584 (1915).

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