JAMES ANDREW L.

PATACSIL
Juris Doctor III
Local Government-Local Autonomy

Mandanas v. Ochoa, Jr.

G.R. No. 199802; G.R. No. 208488; July 3, 2018

FACTS:

The petitioners hereby challenge the manner in which the just share in the national taxes
of the local government units (LGUs) has been computed.
This is a special civil action for certiorari, prohibition and mandamus assailing the manner
the General Appropriations Act (GAA) for FY 2012 computed the IRA for the LGUs. Certain
collections of NIRTs by the Bureau of Customs (BOC) — specifically: excise taxes, value added
taxes (VATs) and documentary stamp taxes (DSTs) — have not been included in the base amounts
for the computation of the IRA.
The procedural issue is the propriety of the remedy of mandamus in violation of doctrine
of separation of powers.
The substantive issue is whether Section 284 of the LGC is unconstitutional for being
repugnant to Section 6, Article X of the 1987 Constitution.

ISSUE/S:

1. Whether or not Mandamus is the proper vehicle to assail the constitutionality of the relevant
provisions of the GAA and the LGC;

2. Whether or not Section 284 of the LGC is unconstitutional for being repugnant to Section 6,
Article X of the 1987 Constitution;

3. Whether or not the existing shares given to the LGUs by virtue of the GAA is consistent with
the constitutional mandate to give LGUs a 'just share" to national taxes following Article X,
Section 6 of the 1987 Constitution;

RULINGS:

I.

No, Mandamus is an improper remedy.

For the writ of mandamus to issue, the petitioner must show that the act sought to be
performed or compelled is ministerial on the part of the respondent. An act is ministerial when it
does not require the exercise of judgment and the act is performed pursuant to a legal mandate.
The burden of proof is on the mandamus petitioner to show that he is entitled to the performance
of a legal right, and that the respondent has a corresponding duty to perform the act. The writ of
mandamus may not issue to compel an official to do anything that is not his duty to do, or that is
his duty not to do, or to obtain for the petitioner anything to which he is not entitled by law.
Constitution is an entirely discretionary power. The discretion of Congress thereon, being
exclusive, is not subject to external direction; otherwise, the delicate balance underlying our
system of government may be unduly disturbed. (Violation of doctrine of separation of powers).

Garcia's petition, while dubbed as a petition for mandamus, is also a petition for certiorari
because it alleges that Congress thereby committed grave abuse of discretion amounting to lack or
excess of jurisdiction. It is worth reminding that the actual nature of every action is determined by
the allegations in the body of the pleading or the complaint itself, not by the nomenclature used to
designate the same. 6 Moreover, neither should the prayer for relief be controlling; hence, the
courts may still grant the proper relief as the facts alleged in the pleadings and the evidence
introduced may warrant even without a prayer for specific remedy.

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JAMES ANDREW L. PATACSIL
Juris Doctor III
Local Government-Local Autonomy

II.

No, Municipal corporations, being the mere creatures of the State, are subject to the will of
Congress, their creator. Their continued existence and the grant of their powers are dependent
on the discretion of Congress.

Municipal corporations are now commonly known as local governments. They are the
bodies politic established by law partly as agencies of the State to assist in the civil governance of
the country. Their chief purpose has been to regulate and administer the local and internal affairs
of the cities, municipalities or districts. They are legal institutions formed by charters from the
sovereign power, whereby the populations within communities living within prescribed areas have
formed themselves into bodies politic and corporate, and assumed their corporate names with the
right of continuous succession and for the purposes and with the authority of subordinate self-
government and improvement and the local administration of the affairs of the State.

In the case of Magtajas v. Pryce Properties Corporation, lnc it was ruled that “Municipal
governments are only agents of the national government. Local councils exercise only delegated
legislative powers conferred on them by Congress as the national lawmaking body. The delegate
cannot be superior to the principal or exercise powers higher than those of the latter. It is a heresy
to suggest that the local government units can undo the acts of Congress, from which they have
derived their power in the first place, and negate by mere ordinance the mandate of the statute.

Municipal corporations owe their origin to, and derive their powers and rights wholly from
the legislature. It breathes into them the breath of life, without which they cannot exist. As it
creates, so it may destroy. As it may destroy, it may abridge and control. Unless there is some
constitutional limitation on the right, the legislature might, by a single act, and if we can suppose
it capable of so great a folly and so great a wrong, sweep from existence all of the municipal
corporations in the State, and the corporation could not prevent it. We know of no limitation on
the right so far as to the corporation themselves are concerned. They are, so to phrase it, the mere
tenants at will of the legislature.

This basic relationship between the national legislature and the local government units has
not been enfeebled by the new provisions in the Constitution strengthening the policy of local
autonomy. Without meaning to detract from that policy, we here confirm that Congress retains
control of the local government units although in significantly reduced degree now than under our
previous Constitutions. The power to create still includes the power to destroy. The power to grant
still includes the power to withhold or recall.

True, there are certain notable innovations in the Constitution, like the direct conferment
on the local government units of the power to tax, which cannot now be withdrawn by mere statute.
By and large, however, the national legislature is still the principal of the local government units,
which cannot defy its will or modify or violate it.

The correct resolution and fair disposition of the issues interposed for our consideration
require a review of the basic principles underlying our system of local governments, and of the
extent of the autonomy granted to the LGUs by the 1987 Constitution. Therefore, the power to
create is the power to abolish vested in the Congress.

III.

Yes. The extent of local autonomy in the Philippines

In the case of Basco v. Philippine Amusement and Gaming Corporation, G.R. No.
91649, May 14, 1991, 197 SCRA 52, 65 the court ruled that the constitutional mandate to ensure
local autonomy refers to decentralization. The autonomy of the LGUs as thereby ensured does not
contemplate the fragmentation of the Philippines into a collection of mini-states, or the creation of
imperium in imperio.

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JAMES ANDREW L. PATACSIL
Juris Doctor III
Local Government-Local Autonomy

In the case of Disomangcop v. Datumanong, G.R. No. 149848, November 25, 2004, 444
SCRA 203, 227 it was ruled that Local autonomy recognizes the wholeness of the Philippine
society in its ethnolinguistic, cultural, and even religious diversities. Decentralization can be
considered as the decision by the central government to empower its subordinates, whether
geographically or functionally constituted, to exercise authority in certain areas. It involves
decision-making by subnational units, and is typically a delegated power, whereby a larger
government chooses to delegate authority to more local governments. Administrative
decentralization or deconcentration involves the transfer of functions or the delegation of authority
and responsibility from the national office to the regional and local offices.

The grant of autonomy simply means that Congress will allow the LGUs to perform certain
functions and exercise certain powers in order not for them to be overly dependent on the National
Government subject to the limitations that the 1987 Constitution or Congress may impose.

In its broad or general sense, decentralization has two forms in the Philippine setting,
namely: the decentralization of power and the decentralization of administration. The
decentralization of power involves the abdication of political power in favor of the autonomous
LGUs as to grant them the freedom to chart their own destinies and to shape their futures with
minimum intervention from the central government. This amounts to self-immolation because the
autonomous LGUs thereby become accountable not to the central authorities but to their
constituencies.

On the other hand, the decentralization of administration occurs when the central
government delegates administrative powers to the LGUs as the means of broadening the base of
governmental powers and of making the LGUs more responsive and accountable in the process,
and thereby ensure their fullest development as self-reliant communities and more effective
partners in the pursuit of the goals of national development and social progress. This form of
decentralization further relieves the central government of the burden of managing local affairs so
that it can concentrate on national concerns.

Therefore, certain limitations are and can be imposed by Congress in all the forms of
decentralization, for local autonomy, whether as to power or as to administration, is not absolute.
The LGUs remain to be the tenants of the will of Congress subject to the guarantees that the
Constitution itself imposes.

DOCTRINE:

Local Autonomy, One of the key features of the 1987 Constitution is its push towards
decentralization of government and local autonomy. Local autonomy has two facets, the
administrative and the fiscal. 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. Such autonomy is as indispensable to the viability of the
policy of decentralization as the other.

The doctrine of operative fact recognizes the existence of the law or executive act prior to
the determination of its unconstitutionality as an operative fact that produced consequences that
cannot always be erased, ignored or disregarded. In short, it nullifies the void law or executive act
but sustains its effects. It provides an exception to the general rule that a void or unconstitutional
law produces no effect.

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JAMES ANDREW L. PATACSIL
Juris Doctor III
Local Government-Local Autonomy

Pimentel vs Ochoa and Soliman

G.R. No. 195770, 17 July 2012

FACTS:

In 2007, the Department of Social Welfare & Development (DSWD) embarked on a

poverty reduction strategy with the poorest of the poor as target beneficiaries. Named "Ahon
Pamilyang Pilipino," it was pre-pilot tested in the municipalities of Sibagat and Esperanza in
Agusan del Sur; the municipalities of Lopez Jaena and Bonifacio in Misamis Occidental, the
Caraga Region; and the cities of Pasay and Caloocan upon the release of the amount of P50 Million
Pesos under a Special Allotment Release Order (SARO) issued by the Department of Budget and
Management.

On July 16, 2008, the DSWD issued Administrative Order 16, series of 2008, setting the
implementing guidelines for the project renamed "Pantawid Pamilyang Pilipino Program" (4Ps),
also referred to as Conditional Cash Transfer Program (CCTP), which provides cash grants to
extreme poor households to allow the members of the families to meet certain human development
goals.” Eligible households selected from priority target areas are granted health and education
benefits for a total annual subsidy of ₱15,000.00.

AO 16 also institutionalized a coordinated inter-agency network among Department of

Education (DepEd, DOH, DILG, the National Anti-Poverty Commission (NAPC) and ocal
government units (LGUs). DSWD as lead implementing agency “oversees and coordinates the
implementation, monitoring, and evaluation of the program” while the LGU is responsible for the
availability of health and education supply, and providing technical assistance for the Program
implementation, among others. DSWD executed Memorandum of Agreement (MOAs) with each
participating LGUs to outline the obligation of both parties during the 5-year implementation
period. Congress then provided funding for the project as follows: P298K in 2008, P5 Billion in
2009, P10 Billion in 2010, and P21 Billion in 2011.

ISSUE/S:
Whether or not the CCTP budget allocation under the DSWD violates Article II, Sec. 25 and
Article X, Sec. 3 of the 1987 Constitution in relation to Sec. 17 of the LGC of 1991 by providing
for the recentralization of the National Government in the delivery of basic services already
devolved to the LGUs

RULINGS:

No. The Constitution declares it a policy of the State to ensure the autonomy of local
governments and even devotes a full article on the subject of local governance.

In the case of Ganzon v. Court of Appeals the Supreme Court ruled that while it is through
a system of decentralization that the State shall promote a more responsive and accountable local
government structure, the concept of local autonomy does not imply the conversion of local
government units into "mini - states." With local autonomy, the Constitution did nothing more
than "to break up the monopoly of the national government over the affairs of the local
government" and, thus, did not intend to sever "the relation of partnership and interdependence
between the central administration and local government units."

Petitioners admit that the wisdom of adopting the CCTP as a poverty reduction strategy for
the Philippines is with the legislature. They take exception, however, to the manner by which it is
being implemented, that is, primarily through a national agency like DSWD instead of the LGUs
to which the responsibility and functions of delivering social welfare, agriculture and health care
services have been devolved pursuant to Section 17 of Republic Act No. 7160, also known as the
Local Government Code of 1991, in relation to Section 25, Article II & Section 3, Article X of the
1987 Constitution.

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JAMES ANDREW L. PATACSIL
Juris Doctor III
Local Government-Local Autonomy

Petitioners assert that giving the DSWD full control over the identification of beneficiaries
and the manner by which services are to be delivered or conditionalities are to be complied with,
instead of allocating the P21 Billion CCTP Budget directly to the LGUs that would have enhanced
its delivery of basic services, results in the "recentralization" of basic government functions, which
is contrary to the precepts of local autonomy and the avowed policy of decentralization.
In Pimentel v. Aguirre, the Court defined the extent of the local government's autonomy
in terms of its partnership with the national government in the pursuit of common national goals,
referring to such key concepts as integration and coordination. Thus:

Under the Philippine concept of local autonomy, the national government has not
completely relinquished all its powers over local governments, including autonomous regions.
Only administrative powers over local affairs are delegated to political subdivisions. The purpose
of the delegation is to make governance more directly responsive and effective at the local levels.
In turn, economic, political and social development at the smaller political units are expected to
propel social and economic growth and development. But to enable the country to develop as a
whole, the programs and policies effected locally must be integrated and coordinated towards a
common national goal. Thus, policy-setting for the entire country still lies in the President and
Congress.

DOCTRINE:

Local autonomy is either decentralization of administration or decentralization of power.

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 to make local governments ‘more responsive and 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.’ At the same time, it relieves the central government of
the burden of managing local affairs and enables it to concentrate on national concerns. The
President exercises ‘general supervision’ over them, but only to ‘ensure that local affairs are
administered according to law.’ He has no control over their acts in the sense that he can substitute
their judgments with his own.

Decentralization of power, on the other hand, involves an abdication of political power in

the [sic] favor of local governments [sic] units declared to be autonomous. In that case, the
autonomous government is free to chart its own destiny and shape its future with minimum
intervention from central authorities. According to a constitutional author, decentralization of
power amounts to ‘self-immolation,’ since in that event, the autonomous government becomes
accountable not to the central authorities but to its constituency.

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JAMES ANDREW L. PATACSIL
Juris Doctor III
Local Government-Local Autonomy

Gen San vs. COA

G.R. No. 199439, April 22, 2014

FACTS:

Former Mayor Acharon of General Santos City issued Executive Order No. 40, series of
2008, creating management teams pursuant to its organization development program. In addition
to, Executive Order No. 13, series of 2009 was also adopted embodying the organization
development masterplan. This was followed by Resolution No. 004, series of 2009, requesting for
the mayor’s support for GenSan Scheme on Early Retirement for Valued Employees Security
(SERVES), an early retirement program to be proposed to the Sangguniang Panlungsod.

Consequently, Ordinance No. 08, series of 2009, was passed together with its
implementing rules and regulations. The said ordinance “provides for separation benefits for
sickly employees who have not yet reached retirement age.”

Respondent Commission on Audit (COA) argued that Ordinance No. 08, series of 2009,
partakes of the nature of a supplementary retirement benefit plan proscribed by Section 28,
paragraph (b) of Commonwealth Act No. 186 as amended. COA also observed that GenSan
SERVES was not based on a law passed by Congress but on ordinances and resolutions
passed and approved by the Sangguniang Panlungsod and Executive Orders by the city
mayor. Moreover, nowhere in Section 76 of the Local Government Code, does it provide a
specific power for local government units to establish an early retirement program.

ISSUE:
Does the constitutional mandate for local autonomy grant local governments the power to
streamline and reorganize as well as the authority to create a separate or supplementary
retirement benefit plan

RULINGS:

Local autonomy also grants local governments the power to streamline and reorganize.
This power is inferred from Section 76 of the Local Government Code on organizational structure
and staffing pattern, and Section 16 otherwise known as the general welfare clause.

Designing and implementing a local government unit’s own "organizational structure and
staffing pattern" also implies the power to revise and reorganize. Without such power, local
governments will lose the ability to adjust to the needs of its constituents. Effective and efficient
governmental services especially at the local government level require rational and deliberate
changes planned and executed in good faith from time to time.

Petitioner city explains that unlike the facts in Conte, Ordinance No. 08, series of 2009,
was designed to entice employees who are unproductive due to health reasons to avail of the
incentives by way of an early retirement package. In essence, the incentives are severance pay.
Those who have reached retirement age are disqualified.36

Petitioner city adds that GenSan SERVES is a one-time offer. It is available only to
qualified employees who applied within two months from the ordinance’s effectivity. In fact, out
of its 1,361 regular employees, 50 employees applied. Out of all that applied, only 39 employees
qualified to avail of the incentives provided by the ordinance

In Betoy v. The Board of Directors, NAPOCOR, this court explained that a streamlining
of organization for a more efficient system must pass the test of good faith in order to be valid:

A reorganization involves the reduction of personnel, consolidation of offices, or abolition

thereof by reason of economy or redundancy of functions. It could result in the loss of one's

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JAMES ANDREW L. PATACSIL
Juris Doctor III
Local Government-Local Autonomy

position through removal or abolition of an office. However, for a reorganization for the purpose
of economy or to make the bureaucracy more efficient to be valid, it must pass the test of good
faith; otherwise, it is void ab initio.

The Court declares Section 6 on post-retirement incentives as valid.

DOCTRINE:
Local autonomy also grants local governments the power to streamline and reorganize

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JAMES ANDREW L. PATACSIL
Juris Doctor III
Local Government-Local Autonomy

Land Transportation Office vs City of Butuan

GR No. 131512, 20 January 2000

FACTS:

The Sangguniang Panglungsod (SP) of Butuan on August 16, 1992 passed an ordinance
entitled “ An Ordinance Regulating the Operation of Tricycles for hire, providing mechanism
for the issuance of Franchise, Registration and Permit, and imposing Penalties for Violations
thereof and for other purposes.” The ordinance provided for, among other things, the payment of
franchise fees, fees for registration of the vehicle, and fees for the issuance of a permit for the
driving thereof. The City of Butuan asserts that Sec. 129 and Sec.133 of the Local
Government Code is their basis for said ordinance and that, said provisions authorize LGUs to
collect registration fees or charges along with, in its view, the corresponding issuance of all kinds
of licenses or permits for the driving of tricycles.

Land Transportation Office (LTO) explains that one of the functions of the National
Government that indeed has been transferred to LGUs is the franchising authority over tricycles-
for-hire of the LTFRB but NOT the authority of the LTO to register all motor vehicles and to issue
to qualified persons of licenses to drive such vehicles.

The RTC of Butuan decreed an issuance of a PERMANENT WRIT OF INJUCTION

against LTO prohibiting and enjoining LTO, as well as its employees and other persons acting in
its behalf, from (a) registering tricycles and (b) issuing licenses to tricycle drivers. The CA
sustained the trial court’s decision.

The adverse rulings of both Courts prompted the LTO to file an instant petition for review
on certiorari to annul and set aside the earlier Court decisions.

ISSUE/S;
Whether under the present set-up the power of the LTO to register, tricycles in particular,
as well as to issue licenses for the driving thereof has likewise devolved to Local Government
Units.

RULING:

No, said powers to register and issue licenses remain under LTO’s exclusive jurisdiction.

LGUs unquestionably now have the power to regulate the operation of tricycles-for-hire
and to grant franchises for the operation thereof. "To regulate" means to fix, establish, or control;
to adjust by rule, method, or established mode; to direct by rule or restriction; or to subject to
governing principles or laws.

A franchise is defined to be a special privilege to do certain things conferred by government

on an individual or corporation, and which does not belong to citizens generally of common right.
On the other hand, "to register" means to record formally and exactly, to enroll, or to enter precisely
in a list or the like, and a "driver's license" is the certificate or license issued by the government
which authorizes a person to operate a motor vehicle.

The devolution of the functions of the DOTC, performed by the LTFRB, to the LGUs, as
so aptly observed by the Solicitor General, is aimed at curbing the alarming increase of accidents
in national highways involving tricycles. It has been the perception that local governments are in
good position to achieve the end desired by the law-making body because of their proximity to the
situation that can enable them to address that serious concern better than the national government.

The registration and licensing functions are vested in the LTO (pursuant to Art. 3 Sec. 4(d)
[1], 10 of RA 4136-Land Transportation and Traffic Code) while franchising and regulatory
responsibilities are vested in the LTFRB (Land Transportation Franchising and Regulatory Board;

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JAMES ANDREW L. PATACSIL
Juris Doctor III
Local Government-Local Autonomy

pursuant to EO # 202). Under the Local Government Code (specifically Sec. 458 (8)(3)(VI)), the
Local Government Units now have the power to REGULATE (to fix, establish or control, to adjust
by rule, method or establish mode to direct by rule or restriction; or to subject to governing
principles or laws) the operation of tricycles for hire and grant franchises thereof but they are still
subject to the guidelines prescribed by the DOTC (Department of Transportation and
Communications; under Article 458(a) [3-VI] of the RA 7160).

DOCTRINE:

While the Constitution seeks to strengthen local units and ensure their viability, clearly,
however, it has never been the intention of that organic law to create an imperuim in imperio and
install an infra sovereign political subdivision independent of a single sovereign state.

The 1987 Constitution enunciates the policy that the territorial and political subdivisions
shall enjoy local autonomy. Registration of Tricycles; LGUs have the power to REGULATE
the operation of tricycles for hire and to GRANT FRANCHISES for the operation thereof.

Autonomy is either decentralization of administration or decentralization of power. 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 to
make local governments ‘more responsive and 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, on the other hand, involves an abdication of political power in

the [sic] favor of local governments [sic] units declared to be autonomous. In that case, the
autonomous government is free to chart its own destiny and shape its future with minimum
intervention from central authorities.

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JAMES ANDREW L. PATACSIL
Juris Doctor III
Local Government-Local Autonomy

FACTS:

Petitioner, a QC property owner, assails the constitutionality of two QC ordinances, namely

Ordinance No. SP-2095, S-2011 or the Socialized Housing Tax of Quezon City and Ordinance
No. SP-2235, S-2013 on garbage collection fees.

Section 3 of SP-2095 provides:

SECTION 3. IMPOSITION. A special assessment equivalent to one-half percent (0.5%) on the
assessed value of land in excess of One Hundred Thousand Pesos (Php100,000.00) shall be
collected by the City Treasurer which shall accrue to the Socialized Housing Programs of the
Quezon City Government. The special assessment shall accrue to the General Fund under a special
account to be established for the purpose (i.e., programs and projects for low-cost housing and
other mass dwellings).

On the other hand, Ordinance No. SP-2235, S-2013 on garbage collection places the rates of the
imposable fee dependent on the land or floor area and whether the payee is an occupant of a lot,
condominium, social housing project or apartment.

ISSUES:

1. WON SP-2095, S-2011 on the Socialized Housing Tax (SHT) is valid.

a. WON the SHT is a tax which is within the QC government to impose.
b. WON the SHT violates the rule on equality.
c. WON the SHT is confiscatory or oppressive.
2. WON SP-2235, S-2013 on Garbage Fee is valid.
a. WON the Ordinance on Garbage Fee violates the rule on double taxation.
b. WON it violates the rule on equality. Ruling:

Rulings:

An ordinance carries with it the presumption of validity. The question of reasonableness

though is open to judicial inquiry. Much should be left thus to the discretion of municipal
authorities. Courts will go slow in writing off an ordinance as unreasonable unless the amount is
so excessive as to be prohibitive, arbitrary, unreasonable, oppressive, or confiscatory. A rule which
has gained acceptance is that factors relevant to such an inquiry are the municipal conditions as a
whole and the nature of the business made subject to imposition.

In Batangas CATV, Inc. v. Court of Appeals, 482 Phil. 544 (2004) has this to say:

“The general welfare clause is the delegation in statutory form of the police power of the
State to LGUs. The provisions related thereto are liberally interpreted to give more powers
to LGUs in accelerating economic development and upgrading the quality of life for the
people in the community.”

“It is a fundamental principle that municipal ordinances are inferior in status and
subordinate to the laws of the state. An ordinance in conflict with a state law of general
character and statewide application is universally held to be invalid. The principle is
frequently expressed in the declaration that municipal authorities, under a general grant of
power, cannot adopt ordinances which infringe the spirit of a state law or repugnant to the
general policy of the state. In every power to pass ordinances given to a municipality, there
is an implied restriction that the ordinances shall be consistent with the general law. “

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JAMES ANDREW L. PATACSIL
Juris Doctor III
Local Government-Local Autonomy

In Magtajas vs. Pryce Properties Corp., Inc., ruled that:

“The rationale of the requirement that the ordinances should not contravene a statute is
obvious. Municipal governments are only agents of the national government. Local
councils exercise only delegated legislative powers conferred on them by Congress as the
national lawmaking body. The delegate cannot be superior to the principal or exercise
powers higher than those of the latter. It is a heresy to suggest that the local government
units can undo the acts of Congress, from which they have derived their power in the first
place, and negate by mere ordinance the mandate of the statute.”

1. SP-2095, S-2011 on the Socialized Housing Tax (SHT) is VALID.

a. Yes. The SHT charged by the QC Government is a tax which is within its power to
impose. Cities are allowed to exercise such other powers and discharge such other functions and
responsibilities as are necessary, appropriate, or incidental to efficient and effective provision of
the basic services and facilities which include, among others, programs and projects for low-cost
housing and other mass dwellings. The collections made accrue to its socialized housing programs
and projects. The tax is not a pure exercise of taxing power or merely to raise revenue; it is levied
with a regulatory purpose. The levy is primarily in the exercise of the police power for the general
welfare of the entire city. It is greatly imbued with public interest. Removing slum areas in Quezon
City is not only beneficial to the underprivileged and homeless constituents but advantageous to
the real property owners as well. The situation will improve the value of the their property
investments, fully enjoying the same in view of an orderly, secure, and safe community, and will
enhance the quality of life of the poor, making them law- abiding constituents and better consumers
of business products.

b. No, the SHT does NOT violate the rule on equality. For the purpose of undertaking a
comprehensive and continuing urban development and housing program, the disparities between
a real property owner and an informal settler as two distinct classes are too obvious and need not
be discussed at length. The differentiation conforms to the practical dictates of justice and equity
and is not discriminatory within the meaning of the Constitution. Notably, the public purpose of a
tax may legally exist even if the motive which impelled the legislature to impose the tax was to
favor one over another. It is inherent in the power to tax that a State is free to select the subjects
of taxation. Inequities which result from a singling out of one particular class for taxation or
exemption infringe no constitutional limitation.

c. No, the SHT is NOT confiscatory nor oppressive. The reasonableness of Ordinance No.
SP-2095 cannot be disputed. It is not confiscatory or oppressive since the tax being imposed therein
is below what the UDHA actually allows. While the law authorizes LGUs to collect SHT on lands
with an assessed value of more than P50,000.00, the questioned ordinance only covers lands with
an assessed value exceeding P100,000.00. Even better, on certain conditions, the ordinance grants
a tax credit equivalent to the total amount of the special assessment paid beginning in the sixth
(6th) year of its effectivity. Far from being obnoxious, the provisions of the subject ordinance are
fair and just.

2. SP-2235, S-2013 on Garbage Fee is INVALID. Although it does not violate the rule on
double taxation, it nonetheless violates the rule on equality.

a. SP-2235 does NOT violate the rule on double taxation.

The fee imposed for garbage collections under Ordinance No. SP-2235 is a charge fixed
for the regulation of an activity. In Progressive Development Corporation v. Quezon City, the
Court declared that “if the generating of revenue is the primary purpose and regulation is merely
incidental, the imposition is a tax; but if regulation is the primarypurpose, the fact that incidentally
revenue is also obtained does not make the imposition a tax.” In a U.S. case, the garbage fee was
considered as a "service charge" rather than a tax as it was actually a fee for a service given by the
city which had previously been provided at no cost to its citizens.

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JAMES ANDREW L. PATACSIL
Juris Doctor III
Local Government-Local Autonomy

Hence, not being a tax, the contention that the garbage fee under Ordinance No. SP-2235
violates the rule on double taxation must necessarily fail.

b. Yes, SP-2235 violates the rule on equality.

In City of Manila v. Hon. Laguio, Jr. , 495 Phil. 289, 307 308 (2005), Equal protection
requires that all persons or things similarly situated should be treated alike, both as to rights
conferred and responsibilities imposed. The guarantee means that no person or class of persons
shall be denied the same protection of laws which is enjoyed by other persons or other classes in
like circumstances. Similar subjects should not be treated differently so as to give undue favor to
some and unjustly discriminate against others.

For the purpose of garbage collection, there is, in fact, no substantial distinction between
an occupant of a lot, on one hand, and an occupant of a unit in a condominium, socialized housing
project or apartment, on the other hand. Most likely, garbage output produced by these types of
occupants is uniform and does not vary to a large degree; thus, a similar schedule of fee is both
just and equitable.

The rates being charged by the ordinance are unjust and inequitable: a resident of a 200 sq.
m. unit in a condominium or socialized housing project has to pay twice the amount than a resident
of a lot similar in size; unlike unit occupants, all occupants of a lot with an area of 200 sq. m. and
less have to pay a fixed rate of Php100.00; and the same amount of garbage fee is imposed
regardless of whether the resident is from a condominium or from a socialized housing project.

Indeed, the classifications under Ordinance No. S-2235 are not germane to its declared
purpose of “promoting shared responsibility with the residents to attack their common mindless
attitude in over-consuming the present resources and in generating waste.” Instead of simplistically
categorizing the payee into land or floor occupant of a lot or unit of a condominium, socialized
housing project or apartment, respondent City Council should have considered factors that could
truly measure the amount of wastes generated and the appropriate fee for its collection. Factors
include, among others, household age and size, accessibility to waste collection, population density
of the barangay or district, capacity to pay, and actual occupancy of the property.

DOCTRINE:

For an ordinance to be valid though, it must not only be within the corporate powers of the
LGU to enact and must be passed according to the procedure prescribed by law, it should also
conform to the following requirements: (CUPPGU)

(1) not contrary to the Constitution or any statute;

(2) not unfair or oppressive;
(3) not partial or discriminatory;
(4) not prohibit but may regulate trade;
(5) general and consistent with public policy; and
(6) not unreasonable.

As jurisprudence indicates, the tests are divided into the formal (i.e., whether the ordinance
was enacted within the corporate powers of the LGU and whether it was passed in accordance with
the procedure prescribed by law), and the substantive (i.e., involving inherent merit, like the
conformity of the ordinance with the limitations under the Constitution and the statutes, as well as
with the requirements of fairness and reason, and its consistency with public policy)

In City of Manila v. Hon. Laguio, Jr. , 495 Phil. 289, 307 308 (2005) it was ruled that
An ordinance must pass muster under the test of constitutionality and the test of consistency with
the prevailing laws. If not, it is void. Ordinance should uphold the principle of the supremacy of
the Constitution.

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