Survey and Project Feasibility
- Director of Public Works to investigate and survey water sources and project feasibility.
- Recommendations to be made to the National Waterworks Board.
- Preliminary survey costs borne by concerned province or municipality.
- Board authorizes release of funds, subject to local government financial commitment.
- Construction requires local government resolution guaranteeing annual payments to reimburse government investment plus interest within 20 years.
- Special real estate assessments allowed if regular income insufficient.
Collection and Reimbursement Procedures
- Provincial/municipal treasurer manages water charge collections.
- Collectors appointed with approval, salaries charged against waterworks collections.
- After operational expenses, surplus collections remitted to National Treasury as loan reimbursement with interest.
- Shortfalls to be covered by local government appropriations.
- Reimbursements replenish the revolving fund for future waterworks projects.
Operation and Maintenance
- District engineer responsible for waterworks operation, under regulations approved by Director of Public Works and National Waterworks Board.
- Personnel appointed by Director of Public Works with Secretary’s approval.
- Costs of maintenance and salaries charged to system receipts.
Ownership Transfer Upon Full Reimbursement
- Full reimbursement, including interest, triggers certification by National Waterworks Board to President.
- President issues Executive Order transferring ownership and administration to concerned province or municipality.
- Local government may opt for early full reimbursement before 20 years.
Fund Reversion
- After all projects are completed and fully reimbursed, the revolving fund plus accrued interest reverts to the general funds of the Philippine Treasury.
Construction Procedures
- Construction to be conducted according to section 1917 of the Administrative Code.
Fund Release Conditions and Bond Issuance
- Fund release conditioned on certification of sufficient Treasury funds by Auditor General and Secretary of Finance.
- If insufficient funds, President authorized to issue government bonds worth two million pesos.
- Bonds to be issued with terms including interest, maturity up to 30 years, and currency options.
- Bonds exempt from Commonwealth and local taxes.
Bond Sale and Proceeds Management
- President authorized to sell bonds through Treasurer of the Philippines.
- Proceeds to be deposited in Philippine Treasury or authorized government depository.
Sinking Fund Establishment
- Sinking fund created to ensure bond payment, calculated based on annuity and interest factors.
- Sinking fund custodied by Treasurer of the Philippines.
- Investments of sinking fund regulated under Act No. 3014.
- Expenses of investment charged to sinking fund; income credited thereto.
Appropriations for Sinking Fund and Bond Expenses
- Standing annual appropriation made from general funds for sinking fund and bond interest payments.
- Additional appropriation for bond issue and sale expenses.
Effectivity
- Act takes effect upon approval on November 5, 1936.