EXECUTIVE ORDER NO. 90
EXECUTIVE ORDER NO. 90 -
IDENTIFYING THE GOVERNMENT AGENCIES ESSENTIAL FOR THE NATIONAL SHELTER
PROGRAM AND DEFINING THEIR MANDATES, CREATING THE HOUSING AND URBAN
DEVELOPMENT COORDINATING COUNCIL, RATIONALIZING FUNDING SOURCES AND
LENDING MECHANISMS FOR HOME MORTGAGES AND FOR OTHER PURPOSES
WHEREAS,
Government recognizes that shelter is a basic need for which low and
middle income families, particularly in urbanized areas, require
assistance;
WHEREAS, Government has approved a six-year National Shelter Program
which aims at providing increased levels of such assistance on a
nation-wide basis;
WHEREAS, there is a need to define the mandates of government agencies
involved in housing and to better coordinate and monitor their
activities;
WHEREAS, there is also a need to establish a system that will provide
the funds required for long-term housing loans on continuous,
self-sustaining basis;
WHEREAS, there is likewise a need to encourage private sector
participation in low-cost housing and finance;
NOW, THEREFORE, I, CORAZON C. AQUINO, President of the Philippines, do
hereby order:
Title
I — HOUSING AGENCIES AND MANDATES
Section 1. Key Agencies. — To ensure the
accomplishment of the National Shelter Program, the following primary
government housing agencies, any provision of existing laws and their
respective charters to contrary notwithstanding, are hereby mandated
to:
a)
National Housing Authority — The National Housing Authority shall be
the sole government agency engaged in direct shelter production. It
shall focus its efforts in providing housing, assistance to the lowest
30% of urban income-earners through slum upgrading, squatter
relocation, development of sites and services and construction of
core-housing units. In addition, it shall undertake programs for the
improvement of blighted urban areas and provide technical assistance
for private developers undertaking low-cost housing projects.
Development of its existing properties for housing projects for
income-earners above the lowest 30% may be continued provided that
funds generated thereon are utilized for the attainment of its primary
mandate.
b) National
Home Mortgage Finance Corporation — The National Home Mortgage Finance
Corporation shall be the major government home mortgage institution.
Its initial main function is to operate a viable home mortgage market,
utilizing long term funds principally provided by the Social Security
System, the Government Service Insurance System and the Home
Development Mutual Fund to purchase mortgages originated by both
private and public institutions that are within government approved
guidelines. It also charged with the development of a system that will
attract private institutional funds into long-term housing mortgages.
c) Human
Settlements Regulatory Commission — The Human Settlements Regulatory
Commission; renamed as the Housing and Land Use Regulatory Board, shall
be the sole regulatory body for housing and land development. It is
charged with encouraging greater private sector participation in
low-cost housing through liberalization of development standards,
simplification of regulations and decentralization of approvals for
permits and licenses.
d) Home
Financing Corporation — The Home Financing Corporation, renamed as the
Home Insurance and Guaranty Corporation, shall assist private
developers to undertake low and middle income mass housing production
and encourage private institutional funds and commercial lenders to
finance such housing development and long-term mortgages through a
viable system of guarantees, loan insurance and other incentives.
Sec. 2. Support Agencies. — To ensure that the
funds required for long-term housing loans are available on a
continuous and self-sustaining basis, the following support agencies,
any provision of existing laws and their respective charters to the
contrary notwithstanding, are hereby mandated to:
a)
Home Development Mutual Fund — The Home Development Mutual Fund will
continue to administer provident fund contributions collected from
member employees and employers, utilizing funds not required for
provident benefits for housing loans for members, and, in addition,
will be charged with the development of saving schemes for home
acquisition by private and government employees.
b) Social
Security System — The Social Security System shall be the primary
provider of funds long-term housing mortgages for low and middle-income
private sector employees.
c) Government
Service Insurance System — The Government Service Insurance System
shall be the primary provider of funds for long-term housing mortgages
for low and middle-income government employees.
Title
II — THE HOUSING AND URBAN DEVELOPMENT COORDINATING COUNCIL
Sec. 3. Creation; Main Function; Principal Office.
— There is hereby created a Housing and Urban Development Coordinating
Council, hereinafter referred to as the Council, under the immediate
control and supervision of the President of the Philippines, charged
with the main function of coordinating the activities of the government
housing agencies to ensure the accomplishment of the National Shelter
Program. The Council shall have its principal office in Metropolitan
Manila.
Sec. 4. Composition. — The Council shall be
composed of the following:
a.
A Chairman, who shall be appointed by the President of the
Philippines;
b. The Head of
the primary government agencies and the support agencies for funding
for housing enumerated above;
c. One
representative each from the National Economic and Development
Authority, the Ministry of Finance, the Ministry of Budget and
Management, the Ministry of Public Works and Highways and the
Development Bank of the Philippines; and
d. Two
representatives from the private sector to be selected by the Council.
Sec. 5. Powers and Functions of the Council. — The
Council shall have the following powers and functions:
a.
To formulate national objectives for housing and urban development and
to design broad strategies for the accomplishment of these objectives;
b. To
determine the participation and coordinate the activities of the key
government housing agencies in the national housing program;
c. To monitor,
review and evaluate the effective exercise by these agencies of their
assigned functions;
d. To assist
in the maximum participation of the private sector in all aspects of
housing and urban developments;
e. To
recommend new legislation and amendments to existing laws as may be
necessary for the attainment of government’s objectives in housing;
f. To
formulate the basic policies, guidelines and implementing mechanisms
for the disposal or development of acquired or existing assets of the
key housing agencies which are not required for the accomplishment of
their basic mandates;
g. To exercise
or perform such other powers and functions as may be deemed necessary,
proper or incidental to the attainment of its purpose and objectives.
Sec. 6. Powers and Functions of the Chairman. —
The Chairman of the Council shall serve as ex officio Chairman of the
governing Boards of the key housing agencies. To assist him in the
fulfillment of his duties, the Chairman is hereby authorized to create
a Council Secretariat with a staff of qualified personnel.
Sec. 7. Council Secretariat. — The Secretariat
shall be headed by a Secretary-General to be appointed by the Chairman
of the Council. The Secretary-General shall be an ex officio member of
the Council and shall be responsible for the execution and
administration of its approved policies and measures.
Sec. 8. Appropriations. — To cover initially the
expenses of the Council and the Secretariat, the unappropriated funds
of the Ministry of Human Settlements for the Shelter Secretariat shall
be utilized together with proportionate contributions of the key
government housing agencies which is set at TEN MILLION PESOS
(P10,000,000.00). Thereafter, the necessary funds shall be appropriated
every Fiscal Year in the General Appropriations Act.
Title
III — RATIONALIZING THE FUNDING SOURCES AND LENDING MECHANISM FOR HOME
MORTGAGES
Sec. 9. Funding Sources. — To enable the Social
Security System, the Government Service Insurance System and the Home
Development Mutual Fund to provide improved benefits to their members
and to generate the necessary long-term funds for housing, a
rationalization of all employer and employee contributions for all
social insurance and provident fund benefits is hereby directed to
include the following:
a.
Raising the Social Security System maximum compensation, inclusive of
the Cost of Living Allowances, as a basis for contributions from
P1,000.00 to P3,000.00;
b. Making
contributions to the Home Development Mutual Fund voluntary on the
parts of both employees and employers;
c. Instituting
a single mandatory contribution rate for employees and employers for
all social insurance programs.
Sec. 10. Home Development Mutual Fund as Voluntary
Fund. — In the implementation of the above rationalization program, the
following shall govern the operations of the Home Development Mutual
Fund:
a.
All existing contributions together with their accumulated earnings
shall be retained in the Home Development Mutual Fund until their
maturity in accordance with existing rules and regulations.
b. Membership
in the funds for new private and government employees and their
respective employees shall be voluntary after December 31, 1986.
c. After
December 31, 1986, existing members, both employees and employers,
shall have the option to continue or discontinue new Fund
contributions.
d. To
encourage provident fund savings for home acquisition, all government
instrumentalities, agencies and corporations shall match the voluntary
contributions made by government employees in accordance with existing
ratios. Private employers are urged to match the contributions of their
employees who opt to continue their membership in the Fund.
Sec. 11. Implementing Rules. — The Presidential
Commission on Government Reorganization (PCGR) is hereby instructed to
draft implementing rules for the rationalization of the Home Mortgage
Financing System and for the new Home Development Mutual Fund
guidelines to take effect on January 1, 1987. The National Economic and
Development Authority is hereby instructed to coordinate the drafting
of the implementing rules for the rationalization of all social
insurance programs to take effect not later than March 31, 1987.
Sec. 12. Home Mortgage Financing Corporation. —
Complementary to the rationalization of the Funding Sources as above
provided, an integrated home mortgage financing system is hereby
adopted with the following features:
a)
Landing Guidelines — Amounts financed, interest rates, and terms on
home mortgages to be purchased by the National Home Mortgage Finance
Corporation shall be determined by the Council on recommendation by its
technical staff which shall include representatives of the funding
institutions.
b) Allocation
of Fund Contributions — For 1987, the total amount to be made available
for long term mortgages under the National Shelter Program will be P4.2
billion. The Social Security System, the Government Service Insurance
System, and the Home Development Mutual Fund will contribute a total of
P3.4 billion, to be allocated by the National Economic and Development
Authority among the agencies in an equitable manner. The National
Government shall contribute the balance of funds required. Thereafter,
each institution, on recommendation of the Council, shall set a fixed
percentage of their annual investable funds for long-term home
mortgages. These funds shall be made available to the National Home
Mortgage Finance Corporation under terms which ensure their repayment.
c) Lending
rates Chargeable to the National Home Mortgage Finance Corporation —
Funds shall be used by the National Home Mortgage Finance Corporation
principally to extend mortgage loans for the members of the funding
agencies. For this, the agencies will charge the National Home Mortgage
Finance Corporation annual interest equivalent to the average interest
rate charged to members under terms approved by the council less a
reasonable spread to cover the National Home Mortgage Finance
Corporation’s administration costs as well as adequate provisions for
loans losses. The funding agencies may also make direct loans or
purchase securities from the National House Mortgage Finance
Corporation. In this event, interest rates and terms shall be as agreed
between the National Home Mortgage Finance Corporation and the funding
Institution.
Sec. 13. Interim Arrangement. — A phasing-in
process for the implementation of the Home Mortgage Financing System as
above provided shall be determined and implemented by the Council over
a period not to exceed six months. In the interim, the Social Security
System, the Government Security Insurance System and the Home
Development Mutual Fund shall continue with their home mortgage lending
activities provided that the beneficiaries, lending packages, rates,
terms and procedures shall be made uniform and in accord with the
National Shelter Program not later than December 31, 1986. Such loans
shall be considered as partial compliance with each agency’s funding
commitments for the year.
Title
IV — OTHER PROVISIONS
Sec. 14. Special Provisions. — To further assist
the housing agencies in the fulfillment of their primary objectives,
the following are directed to be undertaken:
a.
The Metropolitan Waterworks and Sewerage System, within its area of
jurisdiction, shall immediately take over water and sewerage systems
completed by the National Housing Authority.
b. The direct
housing development activities of the Human Settlement Development
Corporation’s housing and construction materials subsidiaries as well
as the Land Investment Trust administered by the Home Financing
Corporation shall be phased out within a period of three (3) years from
the effectivity of this Executive Order. All concerned agencies shall,
not later than March 31, 1987, submit to the Council their respective
phasing-out programs. Whatever net proceeds realized therefrom shall be
turned over to the National Government.
c. The Social
Security System and the Government Service Insurance System shall be
allowed to engage in bridge development financing of low and middle
income mass housing projects;
The National Home Mortgage
Finance Corporation shall be recapitalized so that its unimpaired
capital after realistic provisions for losses amounts to P500 million.
e. The Home
Financing Corporation shall be recapitalized to enable it to fulfill
objectives.
Sec. 15. Separability. — The provisions of this
Executive Order are declared to be separable and if any provision or
the application thereof is held invalid or unconstitutional, the
validity of other provisions shall not be affected.
Sec. 16. Repealing Clause. — All laws, orders,
issuances, corporate charters, rules and regulations or parts thereof
inconsistent with this Executive Order are hereby repealed or modified
accordingly.
Sec. 17. Effectivity. — This Executive Order shall
take effect immediately.
Done in the City of Manila,
this 17th day of December, in the year of Our Lord, nineteen hundred
eighty-six.
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Since 19.07.98.