Legal basis and related mandates
- The ordinance grounds its implementation on Presidential Decree No. 824, which includes Valenzuela City within the territorial jurisdiction of Metropolitan Manila (as recited in the whereas clauses).
- The ordinance relies on Republic Act No. 8526, which converts Valenzuela into a highly urbanized city effective 14 February 1998 (as recited in the whereas clauses).
- The ordinance invokes Republic Act No. 7160 (Local Government Code of 1991) for local autonomy policy and the administration of real property tax (Section 200 as recited in the whereas clauses, and Section 18 as recited in the whereas clauses).
- The ordinance states that the City Assessor prepares the schedule of fair market values under Section 219 of Republic Act No. 7160 (as recited in the whereas clauses).
- The ordinance identifies DOF-DILG Joint Memorandum Circular No. 2010-01 as requiring and strengthening general revision and enjoining legislative action to incorporate the updated schedule prepared by the City Assessor (as recited in the whereas clauses).
Policy, purpose, and general revision cycle
- The ordinance adopts updated industrial market values to respond to the rise of existing market value and to regulate the industrial class in a manner it characterizes as just, fair and equitable (as recited in the whereas clauses).
- The ordinance requires the City Assessor to undertake a general revision necessary for appraisal and assessment immediately upon enactment, then conduct general revisions every three (3) years thereafter (Section 11).
- The ordinance states its industrial appraisal framework follows fundamental legal principles on real property appraisal under Republic Act No. 7160 (as stated in Section 5).
Definitions and classification rules
- Industrial land is defined as land devoted principally to industrial activity as capital investment, and it is not classified as agricultural, commercial, timber, mineral or residential land (Section 5).
- All references to base value are construed as base value per square meter (sq.m.) (Section 5).
- The ordinance identifies General Industrial Zone as a mixed-use zone intended for industrial developments, with industrial as dominant use and appraisal/assessment classified as industrial even where other use exists as secondary use (Section 5).
- Buildings and structures are classified for appraisal according to types of improvements tied to construction and fire-resistance characteristics (Section 6) and are further evaluated using unit cost schedules and additional factors (Sections 8–10).
Industrial land sub-classification and base values
- The ordinance establishes industrial land sub-classification limiting the classification based on the diversity of data in a sub-market and the existing land use/comprehensive land use program of the city (Section 3).
- First Class Industrial Land (Industrial - 1 / (Ia-1)) has a unit value of PHP 6,000.00 per square meter and applies to locations along major thoroughfares where the highest industrial/manufacturing activities take place (Section 3).
- Second Class Industrial Land (Industrial - 2 / (Ia-2)) has a unit value of PHP 4,500.00 per square meter and applies to locations along secondary roads but accessible through major thoroughfares (Section 3).
- Third Class Industrial Land (Industrial - 3 / (Ia-3)) has a unit value of PHP 3,000.00 per square meter and applies to locations along weather roads and secondary roads (Section 3).
- Section 4 sets the 2014 Market Value Per Sq. M. for industrial land per barangay/street/vicinity and assigns each lot to a sub-class (Ia-1, Ia-2, or Ia-3) through a barangay-by-barangay listing.
- The ordinance includes specific listings under Barangay Codes 01 to 33, assigning base market values (commonly 3,000.00 for Ia-3 and 4,500.00 for Ia-2 in the visible schedule) for identified streets, roads, and vicinity segments (Section 4).
Adjustments for industrial land valuation
- Industrial land valuation applies a maximum reduction of not more than 10% of the base value per square meter for frequently flooded areas or lots (Section 5).
- Industrial land valuation applies a maximum reduction of not more than 5% for lots along gravel, earth or dirt roads (Section 5).
- Where gravel, earth or dirt roads are improved, the valuation is adjusted accordingly (Section 5).
- Vacant or idle lands located in purely industrial areas are classified as industrial (Section 5).
- For parcels of land situated along a barangay boundary, appraisal uses the higher base value rule (Section 5).
- A corner influence value of ten (10%) percent of the base unit value is added for lots situated at the corner of two streets or roads; when the two streets/roads have different base values, the higher base value is applied (Section 5).
- An additional ad valorem tax on idle lands is imposed at the rate of two (2%) percent of the assessed value of land, in addition to the basic real property tax, and appraisal is based on the zoning of the property (Section 5).
- Road lots are valued at twenty-five (25%) percent of the base value, and the right of way is valued at fifty (50%) percent of the base value (Section 5).
Types of building improvements
- The ordinance classifies buildings and other structures into Types I to V consistent with the National Building Code for appraisal purposes (Section 6).
- Type I covers wood construction buildings, including nipa houses and similar structures falling under this type (Section 6).
- Type II covers wood construction with protective fire resistant materials and one-hour fire resistive requirements throughout, with permanent non-bearing partitions allowing fire-retardant treated wood within framing assembly (Section 6).
- Type III covers masonry and wood construction with one-hour fire resistive requirements throughout and exterior walls of incombustible fire resistive construction, with specified allowances for wood framing/flooring/siding and GI roofing (Section 6).
- Type IV covers steel, iron, concrete, or masonry construction, with incombustible fire resistive walls/ceiling/permanent partitions, and a detailed allowance for non-bearing partitions using fire-retardant treated wood in framing assembly and distinctions between concrete structural elements and floor/roof elements (Section 6).
- Type V covers fire resistive buildings with structural elements of steel/iron/concrete/masonry and incombustible fire-resistive walls/ceiling/permanent portions, with reinforced concrete systems and hollow block walls with tile roofing described within the type (Section 6).
Extra items unit-cost schedules
- The ordinance prescribes unit value computations for enumerated extra components as component parts of buildings (Section 7).
- Carport is valued at 30% of Base Unit Construction Cost (Section 7).
- Mezzanine is valued at 60% of Base Unit Construction Cost (Section 7).
- Porch is valued at 40% of Base Unit Construction Cost (Section 7).
- Balcony is valued at 45% of Base Unit Construction Cost (Section 7).
- Garage is valued at 45% of Base Unit Construction Cost (Section 7).
- Attic is valued at 60% of Base Unit Construction Cost (Section 7).
- Lanai is valued at 45% of Base Unit Construction Cost (Section 7).
Building appraisal methodology and adjustments
- Buildings and other structures are valued at their current and fair market values using the ordinance’s schedule of unit buildings, based on use, construction characteristics, class/sub-class unit values, and additional factors (Section 8).
- The ordinance defines a building as a constructed edifice usually covered by a roof and more or less completely enclosed by walls serving as a dwelling, storehouse, factory, shelter for animals, or other useful structure, distinguishing it from non-occupancy structures (like fences/monuments) and structures not intended for use in one place (like boats/trailers) (Section 8).
- The ordinance defines improvement as a valuable addition or amelioration that involves capital expenditures and labor, intended to enhance value/beauty/utility or adapt property for new or further purposes (Section 8).
- New improvements consisting of buildings and other structures are valued at their current and fair market value based on the base unit construction cost per square meter (sq.m.) and the schedule’s class/sub-class with additional adjustment factors (Section 8).
- For buildings and other structures constructed in low lying areas or perennially flooded localities or in areas with adverse social and economic conditions, a deduction of ten percent (10%) may be subtracted from the unit base and construction cost of the building type being appraised (Section 8).
- The ordinance establishes building categories including Cold Storage, Factory, Hangar, Industrial building, Warehouse, and Open Shed (Section 8).
- Auxiliary improvements are treated as appurtenances of the main building/structure and their values are added to the value of the main building/structure (Section 8).
- When buildings/structures/improvements are not of the type and kind specified in the schedule but are considered industrial buildings/other structure, appraisal uses current and fair market value independently of the schedule, and taxation assessment follows the prescribed assessment level for such class of property with due regard to actual use (Section 8).
Unit values and depreciation schedules
- The ordinance sets unit values computed per square meter for specified building categories and types (Section 9).
- For Hangar/Industrial Building/Factory/Warehouse, unit values by type are set as follows:
- Type I: 4,300.00 (Hangar/Industrial Building), 3,100.00 (Factory), 2,900.00 (Warehouse) (Section 9).
- Type II: 6,400.00 (Hangar/Industrial Building), 6,200.00 (Factory), 4,800.00 (Warehouse) (Section 9).
- Type III: 7,500.00 (Hangar/Industrial Building), 7,400.00 (Factory), 6,100.00 (Warehouse) (Section 9).
- Type IV: 9,800.00 (Hangar/Industrial Building), 8,500.00 (Factory), 8,200.00 (Warehouse) (Section 9).
- Type V: 10,800.00 (Hangar/Industrial Building), 9,600.00 (Factory), 9,300.00 (Warehouse) (Section 9).
- For Open Shed and Cold Storage, unit values by type are set as follows:
- Type I: 2,800.00 (Open Shed), 6,800.00 (Cold Storage) (Section 9).
- Type II: 4,200.00 (Open Shed), 7,900.00 (Cold Storage) (Section 9).
- Type III: 4,900.00 (Open Shed), 9,200.00 (Cold Storage) (Section 9).
- Type IV: 6,600.00 (Open Shed), 10,200.00 (Cold Storage) (Section 9).
- Type V: 7,400.00 (Open Shed), 11,300.00 (Cold Storage) (Section 9).
- The ordinance sets depreciation schedules for industrial buildings based on type groups (Type I, Type III & II, and Type IV & V) by year numbers (Section 10).
- The depreciation schedule governs depreciation “for purpose of determining the appraisal” of the building or other structure, using the appropriate type group and year entries (Section 10).
Assessor authority and general revision
- The City Assessor must undertake a general revision necessary for appraisal and assessment immediately upon enactment of the ordinance (Section 11).
- The City Assessor must undertake general revision of real property every three (3) years thereafter (Section 11).
- The assessor (including a deputy) may summon owners of properties affected or persons with legal interest, and witnesses, to obtain information for market value, and may administer oaths and take depositions regarding the property, its ownership, amount, nature, and value (Section 12).
Separability, repeals, and effectivity
- The ordinance’s invalidation of any part or provision leaves the remaining provisions in force (Section 13).
- Inconsistent ordinance rules and regulations or parts are repealed, amended, or modified accordingly (Section 14).
- The ordinance takes effect fifteen (15) days after its publication in a newspaper of general circulation (Section 15).