No. ~~.!I~~AL..

B_~DG~~i~~:I~~~~3 529 21 February 2011

TO

All Heads of Departments/Agencies/State Universities and

Colleges. and Other Offices of the National Government,

Government-Owned or Controlled Corporations and Local Government Units, Budget Officers, Heads of Accounting Units and All Others Concerned

SUBJECT
1.0 PURPOSE
1.1

Guidelines for the Release of Funds Chargeable Against the Priority Development Assistance Fund for FY2011

To prescribe guidelines on the release and utilizationof the Priority Development Assistance Fund (PDAF)under Republic Act (R.A.) No. 10147, General AppropriationsAct (GAA)for FY2011; To enhance transparency and accountability in the release and utilizationof the PDAF;and To align local development programs and projects with the national development agenda and prioritiesof the government

1.2 1.3

2.0

GENERAL GUIDELINES 2.1 The PDAF shall be w~ed to fund priority development programs and projects identifiedby Members of Congress or Vice-President from the project menu (or the PDAF Project Menu) hereby attached as

AnnexA.

In the identification of programs/projects or designation of beneficiaries, preference shall be given to projects located in the 4th to 6th class municipalities or indigents identified under the National Household Targeting System for Poverty Reduction by the Department of SOCial Welfare and Development without necessarily excluding other municipalitiesand beneficiaries
The list of programs/projects, as far as practicable, shall conform with the priority list of programs/projects of each implementing agency.

2.2

The PDAF shall not be used for payment of persona! services expenditures, (i.e. payment of salaries, honoraria, allowances, bonus and similarforms of compensation).
Funds shall be released directly to the implementing agencies

2.3

enumerated in the PDAF Project Menu, provided that local government

units (LGUs) may only be identified as implementing agencies if they have the administrative and technical capability to implement the programs/projects. 2.4 The total allocation for programs/projects to be identified shall not exceed the following amounts: 2.4.1 Congressional Districts and Party-listRepresentatives: Total of Seventy Million Pesos (,J;!70,000,000)broken down into Forty Million Pesos (,J;!40,000,000)or infrastructure projects and Thirty f Million Pesos (,J;! 0,000,000) for soft projects. 3 2.4.2 senators and Vice President: Total of Two Hundred Million Pesos (,J;!200,OOO,00O) broken down into One Hundred Million Pesos (,J;!100,000,OOO) for infrastructure projects and One Hundred Million Pesos (,J;!100,000,000) for soft projects. Considering the approved fiscal program of the government, fiftypercent (50%) of the allocation for each legislator and the VicePresident shall be released in the first semester, and the remaining 50%, in the second semester. 2.5 All procurement shall comply with the provisions of R.A. No. 9184 or the Government Procurement Reform Act.

3.0

RELEASE OF FUNDS 3.1 Allotment Within the limits prescribed under Section 2.4 hereof, the Department of Budget and Management (DBM) shall issue the Special Allotment Release Order (SARa) to cover the release of funds chargeable against PDAF. All requests for issuance of allotment shall be supported by the following: 3.1.1 List of priority programs/projects in accordance with the PDAF Project Menu duly signed by the proponent; 3.1.2 Written endorsements/concurrence by the following: 3.1.2.1 In case of the Vice President, the Office of the President;

3.1.2.2

In case of the Senate, the Senate President and the Chairman of the Committee on Finance; In case of the House of Representatives, the Speaker and the Chairman of the Committee on Appropriations; and In case the program/project identified by a District Representative is outside his or her congressional jurisdiction, the District Representative of the beneficiary congressional district.

3.1.2.3

3.1.2.4

3.1.3 Additional supporting documents that may be required under the PDAF Project Menu. 3.2 Cash Allocation 3.2.1 For national government agencies As a general rule, cash requirements of the programs/projects shall be accommodated within the department/agency available cash balance. When the cash balance is insufficient, issuance of Notice of Cash Allocation (NCA) may be made upon submission of the following: 3.2.1.1 3.2.1.2 3.2.1.3 Request of implementing agency; Cash Program; and List of Due and Demandable Accounts (LDDAP).

Payable

NCA for infrastructure projects implemented by Department of Public Works and Highways and Department of Education shall be issued based on the List of Due and Demandable Accounts Payable (LDDAP) in accordance with the Direct Payment Scheme per DBM Circular Letter No. 2005-2 dated January 28, 2005. 3.2.2 For LGUs, the NCA shall be released to the DBM-Regional Office concerned, upon receipt of the SARO by said office. 3.2.3 For government-owned or controlled corporations, the corresponding NCA shall be released to the Department of Finance-Bureau of the Treasury (BTr). 4.0 REALIGNMENT OF FUNDS 4.1 Realignment may be allowed by the DBM if the following conditions exist:

4.1.1 The substitute program/project is within the PDAF Project Menu; 4.1.2 The allotment requested for realignment has not yet been obligated; and 4.1.3 The validity of the allotment has not yet lapsed. Only one realignment is permitted under this fund. 4.2 Requests for realignment shall be supported by the following: 4.2.1 Written reason/justification for realignment duly endorsed by the implementing agency; 4.2.2 Concurrence of the proponent Vice President/legislator; 4.2.3 Certification from the head of the budget office/local treasurer, duly noted by the agency head/local chief executive concerned, that the fund being requested for realignment has not yet been obligated and is still available; 4.2.4 In addition, for LGUs, certification of non-implementation of programs/projects proposed to be realigned, and if funding checks have already been issued/credited to the account of the LGU, submit a Remittance Advice of the amount returned to the BTr; and 4.2.5 In case the substitute program/project identified by a District Representative is outside his or her congressional jurisdiction, written concurrence of the District Representative of the beneficiary congressional district. 4.3 The Secretaries of Education, Health, Social Welfare and Development, Interior and Local Government, Environment and Natural Resources, Energy and Public Works and Highways are authorized to approve realignment from one project/scope to another within the same allotment, subject to the following conditions: (Ij for infrastructure projects, realignment is within the same implementing unit and same project category as the original project; (il) allotment released has not yet been obligated for the original project/scope of work; and (iii) approval/concurrence of the concerned proponent. The DBM must be informed in writing of the approved realignment within five (5) calendar days from its approval. Requests for realignment of unobligated allotment treated as continuing appropriations shall be submitted to DBM not later than June 30,2012.

4.4

5.0

POSTING REQUIREMENTS 5.1 DBM shall post in its official website all releases and realignments under the PDAF. Implementing agencies shall likewise post in their respective official websites the (I) priority list, standard and design submitted to Congress; (i/) projects identified and names of the concerned proponents; (iii) names of project beneficiaries and/or recipients; (iv) any realignment authorized; (v) status of project implementation; and (vi) program/project evaluation and/or assessment reports in line with the Organizational Performance Indicator Framework (OPIF).

5.2 For any procurement to be undertaken under the PDAF, implementing agencies shall post in the Philippine Government Electronic Procurement System (PHILGEPS) or in a newspaper of general circulation all invitations to bid, names of participating bidders with their corresponding bids, and awards of contract. 6.0 ACCOUNTABILITY The implementing agencies shall be accountable for the implementation of the programs/projects, subject to existing budgeting, accounting and auditing rules and regulations. Proponent legislators/vice-president shall be accountable for ensuring that the LGU, chosen by them as implementing agency, meets the requirements under Section 2.3.

7.0

REPEALING CLAUSE All issuances that are inconsistent rescinded/superseded accordingly. with this Circular are hereby

8.0

SAVING CLAUSE Cases not covered by the provisions of this circular shall be referred to DBM for appropriate action.

9.0

EFFECTIVITY This Circular shall take effect immediately.

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'FLORENCIOB. ABAD
Secretary