Legal Framework Governing Fund Release
- 1987 Philippine Constitution mandates promotion of social order, employment, and poverty alleviation.
- Philippine Cooperative Code of 2008 (RA 9520) supports cooperative creation and growth for economic self-reliance.
- Executive Order No. 95 designates CDA as lead agency for cooperative development; EO No. 96 sets implementing rules.
- Local Government Code (RA 7160) mandates local government units as partners in national goals.
- DBM National Budget Circular No. 529 prescribes release guidelines for PDAF funds.
Definitions Critical to the Guidelines
- Cooperative: Autonomous, registered association with common interests, equitable capital contributions, and shared risks/benefits per cooperative principles.
- Fund Assistance: Financial aid from government via CDA, including grants, subsidies, donations.
- Livelihood Programs/Projects: Approved activities creating employment with integrated support services promoting income-generating undertakings.
- Liquidation Report: Summary document of disbursements and expenses related to project implementation.
Eligibility Criteria for Cooperative Beneficiaries
- Must be duly registered under RA 9520.
- Certified to be in good standing.
- No unliquidated financial assistance with CDA.
- Operated continuously for at least three (3) years.
Permissible Uses of Fund Assistance
- Livelihood or enterprise development projects enhancing entrepreneurship among members.
- Credit or relending to provide capital for cooperative or member livelihood projects.
- Capacity-building activities, including training and seminars for cooperative management.
- Operational support and system improvements including acquisition of necessary facilities.
- Project proposals evaluated based on economic viability and acceptability.
Documentary Requirements for Fund Release
- Endorsement letter from sponsoring legislator.
- Cooperative Board Resolution requesting funds specifying purpose and designated officer.
- Detailed project proposal including description, site, beneficiaries, benefits, plans, cost, financial projections, and work plan.
- Certificate of Good Standing with authenticated registration documents.
- List of incumbent officers certified by Secretary and attested by Chairman.
- Audited financial statements for past three years or certification of prior similar projects.
- Memorandum of Agreement (MOA) between CDA and cooperative, duly signed and notarized.
- Certification of at least 20% cooperative equity in the project, including labor, land, facilities, or equipment.
- Evidence of previous similar projects if any.
- Sworn affidavit confirming no conflict of interest among cooperators and CDA officials.
- Disclosure of other related businesses and ownership extent if applicable.
Staggered Release Documentation
- Approved fund release schedule.
- Interim Fund Utilization Report certified by cooperative's accountant, approved by Chairman and verified internally.
- Beneficiaries list with signatures acknowledging receipt of project goods/services.
Liquidation Documentation
- Fund Utilization Report summarizing expenses and accomplishment status, certified and verified.
- Photographic evidence of project implementation.
- Inventory list of equipment acquired through fund assistance, including descriptions, acquisition dates, costs, and dispositions.
- Equipment warranties.
- If cooperative dissolves, official receipts and vouchers for unutilized funds.
- Comprehensive liquidation report.
Procedures for Fund Release
- CDA office verifies cooperative eligibility upon Special Allotment Release Order (SARO).
- Applicant cooperative submits required documentation for verification.
- CDA may conduct validation and submits findings to Executive Director/Regional Director.
- Upon complete application, CDA requests Notice of Cash Allocation from DBM.
- CDA conducts briefing for beneficiary on MOA contents, duties, responsibilities, sanctions, and report requirements.
- Preparation and execution of MOA.
- Cooperative executes Certificate of Undertaking prior to check release.
- Release of check to cooperative beneficiary.
Fund Release Schedule and Conditions
- Release aligned with project's work and financial plan.
- No additional funds released if previous fund utilization and accomplishment reports are incomplete.
- Internal audit verification required to validate reports.
Monitoring of Fund Utilization and Project Progress
- Cooperatives must submit periodic progress reports as per MOA.
- CDA personnel conduct on-site monitoring and submit reports.
- Funds must only be used for approved project purposes.
- Violations result in demand for full refund.
- CDA coordinates with sponsoring legislators' staff for monitoring.
- Continuous monitoring until project completion with terminal report and Certificate of Completion.
- CDA issues Certificate of Acceptance upon project completion.
- Regional Offices consolidate status of fund releases and monitoring annually.
- For fund assistance used for re-lending, monitoring concludes after full utilization cycle, liquidation, and acceptance certificate issuance.
Liquidation Requirements and Enforcement
- Cooperative required to submit liquidation reports per MOA.
- CDA issues notifications and may demand refund for failure to liquidate.
- For lending, liquidation based on actual cash disbursements equating to total fund assistance granted.
Prohibited Uses of Fund Assistance
- Money market placements, time deposits, or investments.
- Cash advances to officials except for project-related expenses.
- Payment of salaries or allowances to personnel unrelated to project.
- Purchase of government supplies, materials, equipment, or vehicles.
- Acquisition of assets not necessary for project or not stipulated in MOA.
- Uses other than that stated in the MOA.
Sanctions for Non-Compliance
- Demand refund of unused or disallowed funds after audit.
- Initiate actions for material breaches of MOA.
- Reserve right to pursue civil or criminal actions against cooperative officials or employees violating MOA provisions.
Dissemination and Amendment
- CDA distributes guidelines to Regional Offices for information and dissemination.
- All inconsistent previous guidelines or issuances are repealed or amended.
Effectivity
- Guidelines become effective 15 days after receipt by the Office of National Administrative Register (ONAR).