DPWH Order on EAO Deductions Allocation

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DPWH DEPARTMENT ORDER NO. 41, S. 2011: DPWH Order on EAO Deductions Allocation

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Title Source: Supreme Court: DPWH Order on EAO Deductions Allocation

Law: Dpwh Department Order No. 41, S. 2011

Decision Date: Jul 26, 2011

The Department of Public Works and Highways amends the allocation of authorized 3% deductions from project funds for engineering and administrative overhead expenses, streamlining funding for both foreign-assisted and locally-funded infrastructure projects while excluding projects costing five million pesos or less.

Law Summary

Engineering and Administrative Overhead (EAO) Expenses Allocation for Foreign-Assisted Projects

A total of 3.0% deduction from the project fund is authorized for EAO expenses.
Breakdown of the 3.0% EAO deductions:
- Central Office (CO)/Project Management Office (PMO): 2.25%
- Equipment: 0.25%
- Regional Office (RO): 0.25%
- District Engineering Office (DEO): 0.25%

EAO Expenses Allocation for Locally-Funded Projects Directly Released to Central Office

Total 3.0% deduction authorized for EAO expenses.
The percentage breakdown depends on the implementing office as follows:
- CO/PMO-Implemented Projects:
  - Central Office: 2.50%
  - Regional Office: 0.25%
  - District Engineering Office: 0.25%
- RO-Implemented Projects:
  - Central Office: 1.0%
  - Regional Office: 1.75%
  - District Engineering Office: 0.25%
- DEO-Implemented Projects:
  - Central Office: 1.0%
  - Regional Office: 0.25%
  - District Engineering Office: 1.75%

EAO Expenses Allocation for Locally-Funded Projects Released Directly to RO or DEO

Maximum deductions allowed:
- Regional Offices: not more than 2.5% of project cost
- District Engineering Offices: not more than 2.0% of project cost
For RO-implemented projects:
- Regional Office: 2.00%
- District Engineering Office: 0.50%
- Total: 2.50%
For DEO-implemented projects:
- Regional Office: 2.0%
- District Engineering Office: 2.0%

Exclusion of Small Projects from EAO Deductions

EAO deductions are not authorized for infrastructure projects with a total cost of Five Million Pesos (₱5,000,000) or below.

Effectivity and Supersession

This Department Order supersedes all previous contrary issuances.
It took effect immediately upon adoption on 26 July 2011.

Legal Authority and Adoption

Issued by the Department of Public Works and Highways, signed by Secretary Rogelio L. Singson.
Consistent with the Special Provisions of the General Appropriations Act (GAA) for FY 2011, Section 6.

END