Law Summary
Real Property Tax Exemption
- Lands, buildings, and other real property including attached equipment used exclusively for water supply generation and distribution are exempt from real property tax.
- This exemption does not apply if the property is used for offices or other commercial purposes.
Duration and Conditions for Tax Exemptions
- Tax exemptions in Sections 1 and 2 are granted for a period of five (5) years from the Act’s effectivity date.
- Water districts must implement internal control reforms to improve economic and financial viability.
- Appropriations for personal services, travel, transportation, representation expenses, and motor vehicle purchases must not increase by more than 25% annually during the exemption period.
Reporting Requirements
- Water districts, through the Local Water Utilities Administration, must submit annual statistical data and financial statements to the Bureau of Local Government Finance under the Department of Finance.
- This monitoring is to ensure compliance and evaluate the rationale behind the tax exemptions.
Condonation of Unpaid Taxes and Duties
- Unpaid taxes and duties from October 15, 1984, to the Act’s effectivity are condoned if:
- The Bureau, upon reviewing financial data, confirms the water district’s inability to pay after accounting for operational expenses, debt servicing, and reserve.
- The water district submits a program of internal reforms certified by the Local Water Utilities Administration to restore economic and financial viability.
Rulemaking Authority
- The Secretary of Finance is authorized to promulgate the necessary rules and regulations for the effective implementation of the Act.
Repealing Clause
- All laws, decrees, orders, rules, and regulations inconsistent with this Act are repealed or modified accordingly.
Effectivity
- The Act takes effect immediately upon approval.