Scope and Types of Eligible Projects
- Assistance targets public works and highway projects with contract costs up to PhP700,000.
- Eligible projects include school buildings, barangay roads, flood control measures, communal irrigation systems, wells, health centers, and similar community infrastructure.
Criteria for Prospective Beneficiaries
- Applicants must be Filipino citizens or fully Filipino-owned partnerships/cooperatives.
- Key officers must have been bona fide residents of the project region for at least three years.
- Applicants must commit to hiring unskilled labor locally and semi-skilled labor provincially.
- Technical qualifications include past experience of projects amounting to 10% of contract cost but not exceeding PhP1,000,000 in aggregate for the last year.
- Must own basic construction tools and employ at least one experienced construction foreman.
- Financial capability demonstrated by positive net worth from latest income tax return.
Types of Assistance Provided
- Assistance is provided as a loan bearing 12% annual interest.
- Loan can cover working capital (not exceeding 1.5 months operating expenses or 15% of contract cost) and/or purchase of light construction equipment (max 15% of contract cost).
- Additional loan may cover bid bonds (2.5% of bid price) and performance bonds (5% of contract price), with premiums and banking charges included.
Financing Institutions
- Loans are extended through banks or financing institutions designated by KKK National Secretariat.
Implementation Procedures
- Prequalification by government agency (e.g. District or City Engineer's Office).
- Contractor submits applications for both prequalification and KKK assistance.
- Approved applicants endorsed to KKK Regional Action Officer (RAO) who evaluates loan viability.
- Contractor submits bid with RAO's endorsement.
- Upon award, contract is perfected and funds deposited in designated bank accruing interest to National Treasury.
- Loan disbursement and amortization coordinated through progress payments processed by the agency.
- Equipment purchase loans secured by chattel mortgage.
- Procedures ensure prompt processing of contractor payment requests.
Defaults and Penalties
- Contractors who default (fail contractual obligations) are subject to termination or rescission.
- Defaulted contractors face blacklisting by government agencies and financing institutions.
- Possible civil or other legal actions apply.
Implementation and Administrative Authority
- The Minister of Public Works and Highways, coordinated with KKK Secretariat, shall issue implementing rules, forms, and circulars.
Repealing Clause
- Conflicting laws, decrees, rules, or regulations including parts of Presidential Decree No. 1594 shall be repealed or modified accordingly.
Separability Clause
- Invalidity of any part of the Executive Order shall not affect the remainder if the remaining portions can fulfill the intended objectives.
Effectivity
- The Executive Order takes effect immediately upon issuance.