DOF Department Order No. 054.2016

November 17, 2016 BLGF MEMORANDUM CIRCULAR NO. 11-003-16 FOR : All BLGF Central and Regional Directors; Provincial, City, Municipal Treasurers and Assistant Treasurers and Others Concerned SUBJECT : DOF Department Order No. 054.2016: Streamlining the Certification of Net Debt Service Ceiling and Borrowing Capacity of Local Government Units (LGUs) This Memorandum Circular is issued to inform the Central and Regional Offices of this Bureau, all Provincial, City and Municipal Treasurers, and others concerned, of the herein attached Department Order (DO) No. 054.2016, dated 25 October 2016 and published in the Philippine Star on 16 November 2016, streamlining the procedures in certifying the Net Debt Service Ceiling (NDSC) and Borrowing Capacity (BC) of LGUs. To implement the said DO, the following guidelines are hereby issued, amending for the purpose Sections II and III of BLGF Memorandum Circular No. 05-2016 dated 26 February 2016: "xxx xxx xxx II. GUIDELINES ON THE ISSUANCE OF CERTIFICATE OF NDSC AND BC A. Responsibilities of the Provincial, City, and Municipal Treasurers. The Local Treasurer, in his/her capacity as financial adviser of the LGU regarding disposition of local government funds and on such other matters relative to public finance, shall: 1. ". . . ." 2. Provide assistance to the Local Chief Executive (LCE) and concerned local officials to ensure completeness and orderliness of the required documents, particularly in verifying the terms and conditions stated in the offer sheet of the financing institution with the letter request of the LCE and the proposed projects, or with the approved Resolution authorizing the LCE to negotiate and enter into a contract for purposes of securing the loan, credit or indebtedness applied for , every time a request for the Certificate is filed with the BLGF as provided for in Section 3 of DO No. 054.2016. Calamity-stricken LGUs, for a period of one (1) year from the declaration of state of calamity by either the national or local authorities, shall only be required to submit the documents stated in Sections 3.1 and 3.2 of the said DO, together with certified copy of such declaration. DETACa 3. ". . . ." B. Responsibilities of the BLGF Regional Office (BLGF-RO). The BLGF-RO, through the Regional Director shall: 1. Assign a Financial Analyst (FA) who shall consolidate and validate the completeness and orderliness of the documentary requirements, and determine the preliminary computation of the Certificate. To complete these tasks, the following functions shall be performed by the FA: i. ". . . ." ii. ". . . ." iii. Be guided by the procedures in the evaluation of the documentary requirements per DO No. 054.2016. (see Annex C Evaluation Procedures for the Issuance of Certificate of NDSC and BC ). iv. ". . . ." v. Be guided by Sections 5.1 and 5.2 of DO No. 054.2016 on the computation of the NDSC and BC. The audited financial statements submitted by the LGU to the Commission on Audit shall be used as the basis for the computation of the NDSC and BC. The approved SRE reports submitted by the local treasurers to the BLGF through the electronic SRE system may be used as basis for further analysis and computation (see Enclosure A, B and C Revised Manual Computation of NDSC and BC ) . The NDSC is DSC less all amortizations for principal and interest, sinking fund, among others, that are payable during the year. The DSC is derived from the parameters set by Section 324(b) of the LGC on the maximum amount that an LGU can appropriate in the annual budget for the payment of statutory and contractual obligations, which shall not exceed twenty percent (20%) of the LGU's annual regular income (ARI). In computing the ARI, it shall be derived from the average of immediately previous three (3) years of locally sourced income (including real property tax, tax on business, fees and charges, income from economic enterprise, and interest income), and other shares from national taxes, as may be authorized by law, plus the current year internal revenue allotment (IRA), as computed by the Department of Budget and Management, at the time the application was received by the BLGF. For LGUs affected by disaster and declared under state of calamity, either by national or local authorities, the BLGF shall not apply averaging, but rather refer to the financial data of the immediately preceding fiscal year, and use the current year IRA, as computed by the DBM, at the time the application was received by the BLGF. DSC = 20% x ARI NDSC = DSC All amortizations payable during the year for principal and interest, sinking fund, among others The BC is defined as the maximum loanable amount for a given period of time and interest rate or annuity factor based on the LGU's ARI. BC = NDSC x Annuity Factor vi. Prepare the Indorsement to the BLGF-CO certifying the completed, consolidated and validated documentary requirements for the Certificate, together with the preliminary computation generated from the eSRE Debt Capacity and Debt Management Modules (see Annex E Indorsement Letter to BLGF-CO ) . 2. ". . . ." 3. Approve the indorsement prepared by the Financial Analyst after thorough evaluation of the completeness and orderliness of the documentary requirements. Likewise, affix signature in the Enclosure C (see Enclosure C Revised Manual Computation of NDSC and BC) of the preliminary computation of the NDSC and BC. III. TIMELY MONITORING OF LGU LOANS AND BORROWINGS All LGU loans and borrowings shall be monitored by the BLGF using the simplified Statement of Indebtedness, Payments and Balances (SIPB). Please refer to Annex F . aDSIHc A. Responsibilities of the Provincial, City and Municipal Treasurers . The Local Treasurer shall: 1. Prepare the annual SIPB by furnishing the data and information based on the loan agreement, which shall include, among others, the kind and purpose of indebtedness, approved amount of loan, name of lending institution, approval and maturity date, terms and conditions of the loan, interest rate frequency of payments, annual amortization (principal and interest), collateral/security, etc. 2. ". . . ." 3. For LGUs with loan/s, submit to the BLGF-RO the annual SIPB report , except for LGUs in the NCR for which their SIPB reports shall be submitted to the BLGF-CO, on or before 28th of February of the subsequent year. For newly contracted loans, the SIPB report shall be submitted within ten (10) days after the approval and/or initial release of the loan. For LGUs without loan/s, submit to the BLGF-RO a certification that the LGU has no existing loan (see LGU Template B Sample Certification of Local Treasurer on Existing Loans/Absence of Loans). B. Responsibilities of the BLGF Regional Office (BLGF-RO). The Financial Analyst shall: 1. ". . . ." 2. Submit to the BLGF-CO every 15th of the month a status report of issued certificate based on the Monthly Inventory Report of Issued Certificates furnished by the BLGF-CO (see Annex G Reporting Tool on Issued Certificate of NDSC and BC). 3. Provide technical assistance to local treasurers to accomplish the SIPB. xxx xxx xxx." All applications pending for review and evaluation as of 16 November 2016 and all other requests received thereafter shall be acted upon by all concerned in compliance with the aforementioned Department Order and following the guidelines herein prescribed. The Regional Directors of this Bureau are hereby instructed to widely and immediately disseminate this Circular to all concerned. Be guided accordingly. (SGD.) NIO RAYMOND B. ALVINA OIC Executive Director DOF Department Order No. 054-16 October 25, 2016. ANNEX A Template Letter of Local Treasurer if Loan is Disapproved/Not Pursued _____________ Date OIC EXECUTIVE DIRECTOR NIO RAYMOND B. ALVINA Bureau of Local Government Finance Department of Finance 8th floor, EDPC Bldg., BSP Complex, Roxas Blvd., Malate, Manila Dear Director ALVINA: This refers to the loan application of this _____________ LGU Type with the _________________________ Name of Financing Institution , with corresponding Certificate of Net Debt Service Ceiling (NDSC) and Net Borrowing Capacity (NBC) issued by that Office, which contains the following information: Certificate No.: Date Issued: Amount of NDSC: Php Amount of BC: Php Purpose of Loan: In connection therewith, please be informed that the said loan was state if the loan was disapproved or was not pursued by the LGU, and state the reason/s . For your information . Very truly yours, _____________________________________ Provincial/City/Municipal Treasurer ANNEX B BLGF Acknowledgment Letter Template _____________ Date Hon. ___________________ ________________________ ________________________ Dear Mayor/Governor ____________: This is to acknowledge receipt of your letter dated _________ Date requesting for the issuance of a Certificate of Debt Service and Net Borrowing Capacity of the _____________________ (LGU Name) for its loan application with the ________________________ Name of Financing Institution , for the _____________________________ (state purpose of the loan) . ETHIDa Rest assured that this Office will take appropriate action on your request within the reglementary period. Thank you. Very truly yours, _______________________ Regional Director ANNEX C Evaluation Procedures for the Issuance of Certificate of NDSC and NBC (per DOF DO No. 054.2016, dated 25 October 2016) REQUIREMENTS INSTRUCTIONAL PROCEDURES FOR BLGF EVALUATOR 1. Letter-request from the Local Chief STEP 1 . Validate the application letter of the Local Chief Executive indicating: Executive (LCE) and check compliance using Attachment A BLGF Checklist of Requirements for the Certification i. The selected lending institutions NDSC and NBC. where the LGU is applying for a loan ii. Terms and conditions of the Note: Please see LGU Template A Sample LCE Letter proposed loan (repayment period of Application. and interest rate) iii. The specific purpose of the loan Determine if the request contains the following: 1. Specific name of lending institution where to apply for a loan. 2. Offer sheet/letter of the lending institution/bank wherein the interest rate and repayment period was indicated or the Terms and conditions of the proposed loan. The Terms and conditions must be consistent with the letter of the LCE. In case of discrepancy the offer sheet shall prevail. 3. Specific name of project/s to be undertaken out of the proposed loan. Proposed project/s must be consistent with the approved Resolution authorizing the LCE to enter into a contract with the financing institution. STEP 2 . If any of the above stated requirements is not present, request the LCE to comply with the requirement No. 1, (see Attachment B Notice of Deficiency in Documentary Requirements OR Attachment C Notice of Return of Letter Request without Action , whichever is applicable). END OF PROCESS 2. Certification by the Local Treasurer STEP 1 . Evaluate the certification on existence/absence of presence or absence of loan/loans of loan/s duly certified by the Local Treasurer as to the duly certified by the Local Treasurer following details: with the following details: - Types of loans & other obligations contracted i. Types of loans and other obligations contracted; - Purpose of loan & other obligations contracted ii. Purpose of loan and other - Name of lending institutions obligations contracted; - Date of approval & maturity iii. Name of lending institutions; - Terms and conditions (interest rate & number of iv. Date of approval and maturity; years to pay) v. Terms and conditions (interest - Remaining balances of loans and other obligations rate and number of years to pay); Note : Please see LGU Template B Sample vi. Remaining balances of loans Certification of Local Treasurer on Existing Loans/ and other obligations; and Absence of Loans. vii. Annual amortization schedules STEP 2 . Validate the annual amortization schedule issued (segregating the principal from by the lending institution as to segregation of principal the interest) issued by the lending from the interest. Each loan of the LGU should have an institution/s individual annual amortization schedule issued by the lending institution. If not, emphasize in the letter to LCE (see Attachment B Notice of Deficiency in Documentary Requirements). END OF PROCESS 3. Commission on Audit (COA) Annual STEP 1 . Evaluate the COA Audit Certificates for the most Audit Certificate for the most recent recent year, and determine if there are adverse findings. If year, which shall be supported by the the Audit Certificate of the most recent year is not yet year-end financial reports for the past available, require the submission of year-end financial three (3) years: reports bearing the stamp received by COA. i. Pre-closing Trial Balance STEP 2 . If there were adverse findings and (General Fund) recommendations made by the Auditor, the LGU should submit an Agency Action Plan and Status of ii. Detailed Statement of Financial Implementation (AAPSI) as to the level of compliance Performance on such recommendations duly certified by the Auditor. Note: Please see LGU Template C An Agency Action Plan and Status Status of Implementation of Prior Year's Audit of Implementation (AAPSI) report Recommendations. If this is not complied with, inform on COA recommendations shall be the LCE (see Attachment B Notice of Deficiency in required if the LGU has adverse Documentary Requirements) . findings. STEP 3 . Validate if the LGU submitted financial reports for the past three (3) years, and cross-check the financial data from each reports: - Pre-closing Trial Balance (General Fund) and - Detailed Statement of Financial Performance If there are no submitted financial reports, request the LCE to submit reports for the past three (3) years (see Attachment B Notice of Deficiency in Documentary Requirements). STEP 4 . Validate if the financial reports are certified correct by the Local Accountant. If not certified, request the LCE for certified financial reports for the past three (3) years (see Attachment B Notice of Deficiency in Documentary Requirements). END OF PROCESS 4. Certification issued by the lending STEP 1 . Validate if the lending institution is not an institution stating that it shall not authorized government depository bank that meets the require LGU deposits as compensating requirements of DOF Department Circular No. 002- balance for the loan, if such lending 2016 dated 8 July 2016. institution is (1) not an authorized STEP 2 . If the lending institution is not an authorized government depository bank or (2) an depository bank , request the LCE to secure certification authorized government depository from the bank/lending institution stating that it shall not bank required to obtain the prior require LGU deposits as compensating balance for the approval of the DOF, as provided loan (see Attachment B Notice of Deficiency in under the DOF Department Circular Documentary Requirements). No. 002-2016 dated 8 July 2016. END OF PROCESS In case the LGU has been declared under the state of calamity either by the national or local authorities shall, for a period of one (1) year from the declaration of state of calamity, be required only to submit the documents stated in Item Nos. 1 and 2, together with certified copy of the declaration. Note: If any or all of the required documents are not submitted within 30 days from receipt of application, issue Attachment C Notice of Return of Letter Request without Action , copy furnished the BLGF CO. ANNEX E Indorsement Letter to BLGF-CO 1st Indorsement _____________ (Date) Respectfully transmitted to the OIC-Executive Director, Bureau of Local Government Finance, Manila, for appropriate action the herein preliminary computation of Net Debt Service Ceiling (NDSC) and Borrowing Capacity (BC) of the ___________________ (Name of LGU) , relative to its loan application for fiscal year _______ , with the ________________________ (Name of Financing Institution/Bank) , for the purpose of ____________________________________ (as stated in the Resolution/enumerate the loan purposes if provided) . The ___________________ Name of LGU has an estimated NDSC of Php_______________ and an NBC of Php_______________ , based on the submitted audited financial reports of the LGU for the past three years, herein enclosed for ready reference, as follows: (identify the enclosures) 1. Enclosure A Detailed Statement of Income Sources; 2. Enclosure B Computation of Annual Regular Income; and 3. Enclosure C Computation of NDSC and BC. This Indorsement further certifies to the completeness and orderliness of the original documents submitted by the same LGU, per Attachment A BLGF Checklist of Requirements for the Certification NDSC and BC duly certified by the Financial Analyst of this Office, with the recommendation for the final issuance of the Certificate by that Office. Thank you. _____________________________ Signature over Printed Name of the BLGF-Regional Director ANNEX F Simplified Statement of Indebtedness, Payments and Balances (SIPB) Annual Statement of Indebtedness, Payments and Balances (SIPB) Name of LGU: ______________________ Instruction: Please prepare a Statement for each kind of loan. ITEM NO. PARTICULARS DETAILS 1 LGU Income Classification 2 Date of Report 3 Lending Institution (Bank or Creditor) 4 Certificate Number NDSC/BC 5 Date of Certification NDSC/BC 6 Monetary Board (MB) Resolution Number 7 Date of MB Opinion 8 Date of Approval of Loan 9 Amount Approved* 10 Maturity Date 11 Type of Indebtedness Instrument (Loan, Bond or other form of indebtedness) 12 Purpose of Indebtedness 13 Terms and Conditions: Fixed or Variable 14 Terms and Conditions: No. of Years of Indebtedness 15 Terms and Conditions: Interest Rate 16 Terms and Conditions: Grace Period (Number of Months or Years) 17 Frequency of Payment 18 Annual Amortization: Principal 19 Annual Amortization: Interest 20 Annual Amortization: Gross Receipt Tax (GRT) 21 Starting Date of Payment 22 Cumulative Payment from Starting Date: Principal 23 Cumulative Payment from Starting Date: Interest 24 Cumulative Payment from Starting Date: GRT 25 Total Amount Released (Availment as of date) 26 Remaining Balance to Date/Undrawn Amount (Line 9-25=26) 27 Outstanding Loan Balance After Principal Payment (Line 9-22=27) 28 Arrears: Principal (if any) 29 Arrears: Interest (if any) 30 Collateral Security 31 Deposit to bond sinking fund for the year 32 Sinking fund balance to date, if any 33 Breakdown of fees and other related costs (of loan) 34 Other relevant terms and conditions (of loan) Certified Correct by: Date Issued: ________________________________ ______________________ Signature over Printed Name of Local Treasurer Note: * Please indicate if on a staggered basis SOURCES OF SIPB INFORMATION Item Information Instruction Source of No. Type Information 1 Income Class Indicate the LGU income classification. Latest DOF Department Order 2 Date Indicate cut-off date of report, e.g., Ending 1st Qrt. March 31, 2016. Reporting date (mm/dd/yyyy) 3 Name Indicate the name of the lending institution (Bank/Financial Loan Agreement Institution or Private Corporation). Write full name. Example: Land Bank of the Philippines, Development Bank of the Philippines 4 Number Issued Certificate Number of Borrowing Capacity. NDSC/BC issued by BLGF 5 Date Input the issue date of Certificate of Net Debt Service and CNDSBC issued (mm/dd/yyyy) Borrowing Capacity (CNDSBC) by BLGF. by BLGF 6 Number Loans from GFI (DBP/LBP) passes through the Monetary Board. Bangko Sentral ng Refer to the MB resolution number provided. Pilipinas (BSP) 7 Date Refer to the MB resolution date of approval. Bangko Sentral ng (mm/dd/yyyy) Pilipinas (BSP) 8 Date Date of Approval of Loan. Loan Agreement (mm/dd/yyyy) 9 Amount Indicate the principal approved amount of loan. Loan Agreement 10 Date Indicate the date that the loan finally becomes due or date of Loan Agreement (mm/dd/yyyy) settlement or completion of payment. 11 Description List Specify the type of indebtedness instrument. Loan Kind of Example: Bond or Syndicated/Bilateral Debt, Loan (Secured or Agreement indebtedness Unsecured), Lease (Build-Operate-Transfer, Build-Lease-Transfer, etc.), Mortgage, Combination, etc. 12 Description List Indicate the reason for borrowing. Loan Agreement/ Type of Loan Example: Construction of: Health Care Center, Social Welfare Council Centers, Trade Center (Public Market or alike), Water District, Resolution School, Government Center (Provincial Hall, City Hall, Municipal Hall, Barangay Hall),Transport Terminal, Sea Port, IT Systems, Entertainment/Sports Center, Waste Management Facility, Disaster/Risk Management Center, Others 13 Description List Specify if the loan rate is fixed or variable (floating), indicate the Loan Agreement base and spread. 14 Number Specify the number of years the LGU is bound to the lending Loan Agreement institution to pay in full. (Period covered to pay the loan.) 15 Rate Indicate the agreed interest rate of the loan. Loan Agreement 16 Number Indicate the number of years that the lending institution provided Loan Agreement to LGU to defer the payment of principal. Usually this first one or two years of the loan. 17 Amount Indicate the amount of annual principal payment made based on Loan Agreement amortization schedule. 18 Pre-defined Indicate the agreed frequency of payment: Loan Agreement Answer Monthly, Quarterly, Semi-annually, or Annually Select only one answer. 19 Amount Indicate the amount of annual interest payment made based on Loan Agreement the amortization schedule. 20 Amount Indicate the amount of annual Gross Receipt Tax (GRT) payment Loan Agreement made based on the amortization schedule. 21 Date Indicate the 1st date of payment in relation to the amortization Record of Debt (mm/dd/yyyy) schedule. Service (RDS) Amortization Schedule 22 Amount Indicate the amount of cumulative principal payment made from RDS-Amortization starting date of payment. Schedule 23 Amount Indicate the amount of cumulative interest payment made from RDS-Amortization starting date of payment. Schedule 24 Amount Indicate the amount of cumulative GRT payment made from RDS-Amortization starting date of payment. Schedule 25 Amount Indicate the total amount that the lending institution released to Loan Agreement the LGU. 26 Amount Indicate the remaining unreleased balance as of the reporting Accounting Office date. (Line 9-25=26) Subsidiary Ledger 27 Amount Indicate the outstanding loan balance after principal payment, Accounting Office as of the reporting date. (Line 9-22=27) Subsidiary Ledger 28 Amount Indicate the amount of principal in arrears as of reporting date. Subsidiary Ledger 29 Amount Indicate the amount of interest in arrears as of reporting date. Subsidiary Ledger 30 Description List Indicate the collateral if any, attached to the loan/s Loan Agreement 31 Amount Indicate the amount set aside for the installment payment of Accounting maturing loans/bonds 32 Amount Indicate the cumulative balance of sinking fund if any, reporting Accounting date. 33 Description List/ There are costs associated in each loan. Enumerate here the fees LGU Amount and other related cost incurred to facilitate the loan. i.e., Documentary Stamp Fees, Up-front Fees and Commitment Fees 34 Description List If any, and other than the terms and conditions indicated above, Loan Agreement enumerate herewith the other relevant terms. ANNEX G Reporting Tool on Issued NDSC/BC Approved Loan Application of LGUs Corresponding to the issued Certificate of NDSC/BC BLGF Regional Office No. _____ As of __________________ LGU Name NDSC/BC Certificate No. Date of Certificate Date of Loan Approval Loan Purpose Note: Add rows to cover all LGUs with issued certificate of NDSC/NBC within Regional jurisdiction. Provide additional column for "Remarks" if necessary. Prepared by: _______________________ Noted by: _______________________ Regional Director ENCLOSURE A DETAILED STATEMENT OF INCOME SOURCES Name of LGU: _____________________ Income Classification: _________ 2013 2014 2015 2016 Real Property Tax (RPT) 0.00 0.00 0.00 Less: Discount 0.00 0.00 0.00 Net RPT 0.00 0.00 0.00 ==== ==== ==== Business Tax 0.00 0.00 0.00 - Tax on Business 0.00 0.00 0.00 - Franchise Tax 0.00 0.00 0.00 - Tax on Sand, Gravel & Other Quarry Resources 0.00 0.00 0.00 Contractors 0.00 0.00 0.00 - Tax on Delivery Trucks & Vans 0.00 0.00 0.00 - Amusement Tax on Admission 0.00 0.00 0.00 - Banks & Other Financial Institutions 0.00 0.00 0.00 - On Peddlers 0.00 0.00 0.00 - Other Business Taxes 0.00 0.00 0.00 - Fines & Penalties 0.00 0.00 0.00 Other Taxes - Tax on Transfer of Real Property Ownership 0.00 0.00 0.00 - Real Property Tax on Idle Lands 0.00 0.00 0.00 - Professional Tax 0.00 0.00 0.00 - Occupational Tax 0.00 0.00 0.00 - Community Tax 0.00 0.00 0.00 - Other Local Taxes 0.00 0.00 0.00 - Fines & Penalties Local Taxes 0.00 0.00 0.00 Fees & Charges 0.00 0.00 0.00 - Weights and Measures 0.00 0.00 0.00 - Permit Fees 0.00 0.00 0.00 - Motor Vehicles User Charges 0.00 0.00 0.00 - Other Permits & Licenses 0.00 0.00 0.00 - Fishery Rental Fees 0.00 0.00 0.00 - Franchising and Licensing Fees 0.00 0.00 0.00 - Fines & Penalties 0.00 0.00 0.00 - Registration Fees 0.00 0.00 0.00 - Registration Plates, Tags & Sticker Fees 0.00 0.00 0.00 Service Income - Clearance/Certificates/Fees 0.00 0.00 0.00 - Affiliation Fees 0.00 0.00 0.00 - Garbage Fees 0.00 0.00 0.00 - Inspection Fees 0.00 0.00 0.00 - Medical, Laboratories, Dental Fees 0.00 0.00 0.00 - Toll and Terminal Fees 0.00 0.00 0.00 - Library Fees 0.00 0.00 0.00 - Hospital Fees 0.00 0.00 0.00 - Occupation Fees 0.00 0.00 0.00 - Processing Fees 0.00 0.00 0.00 - Landing and Parking Fees 0.00 0.00 0.00 - Other Service Income 0.00 0.00 0.00 - Other Fines & Penalties 0.00 0.00 0.00 Receipts from Economic Enterprises 0.00 0.00 0.00 - Income from Cemetery 0.00 0.00 0.00 - Income from Canteen-Operations-Trng. Center 0.00 0.00 0.00 - Income from Markets 0.00 0.00 0.00 - Income from Transportation System 0.00 0.00 0.00 - Income from Slaughterhouse 0.00 0.00 0.00 - Income from Waterworks System 0.00 0.00 0.00 - Rent Income 0.00 0.00 0.00 - Other Fines and Penalties 0.00 0.00 0.00 - Other Business Income 0.00 0.00 0.00 - Fines and Penalties Business Income 0.00 0.00 0.00 Other Income 0.00 0.00 0.00 - Interest Income 0.00 0.00 0.00 - Sales Revenue Demo Farm 0.00 0.00 0.00 - Insurance Income 0.00 0.00 0.00 - Income fr. Grants, Donations 0.00 0.00 0.00 - Other (Miscellaneous) Income 0.00 0.00 0.00 - Subsidy from (Other Funds) 0.00 0.00 0.00 - Gain on Sale of Disposed Asset 0.00 0.00 0.00 - Other Fines and Penalties Other Income 0.00 0.00 0.00 Internal Revenue Allotment 0.00 0.00 0.00 0.00 Other Share from National Tax Collection 0.00 0.00 0.00 Share from Evat 0.00 0.00 0.00 Share from PAGCOR/PCSO 0.00 0.00 0.00 Share from National Wealth 0.00 0.00 0.00 GRAND TOTAL 0.00 0.00 0.00 ==== ==== ==== Prepared by: Date Prepared: ______________________________________ __________________ Name and Signature of Financial Analyst BLGF Region ______ Note: To be included as enclosure in the indorsement letter to be sent to BLGF-CO after the preliminary computation of Net Debt Service Ceiling and Net Borrowing Capacity. ENCLOSURE B COMPUTATION OF ANNUAL REGULAR INCOME (In Thousand Pesos) A. Locally Sourced Income Item 2013 2014 2015 Average 1. Real Property Taxes - - - - 2. Business Taxes - - - - 3. Fees and Charges - - - - 4. Receipts from Eco. Ent. - - - - 5. Other Income Interest Income - - - - Total - - - - B. Other Shares from National Tax Collection Item 2013 2014 2015 Average 1. Share from E-VAT - - - - 2. Share from PAGCOR/PCSO - - - - 3. Share from National Wealth - - - - Total - - - - C. Current Year IRA (2016) - ANNUAL REGULAR INCOME (A+B+C) - Note: IRA in the Average Annual Income is based on CY 2016 Final IRA as estimated by DBM. Amortization Schedule Financing Institution Total Principal Interest GRT Name of Financing Institution - - - - - - - - - - - - - - - - - - - - Total - - - - Prepared by: Date Prepared: ________________________ _____________________ Financial Analyst Note: To be included as enclosure in the indorsement letter to be sent to BLGF-CO after the preliminary computation of Net Debt Service Ceiling and Net Borrowing Capacity. ENCLOSURE C NET DEBT SERVICE CEILING AND BORROWING CAPACITY FY 2016 (In Thousand Pesos) Year (1) Average Locally Sourced Income (LSI) (2) Other Share from National Tax Coll. (3) IRA (4) Annual Regular Income (ARI) (2+3+4) (5) Maximum Debt Service Capacity (5 x 20%) (6) Annual Amortization of Existing Loan (Principal + Interest) (7) Net Debt Service Ceiling (6-7) (8) Borrowing Capacity (8 x ___) (9) 2016 - - - - - - - - Note: 1) Debt Service Capacity is computed in accordance with Sec. 324b of the LGC , which is 20% of the ARI. AIDSTE 2) Annual Regular Income for CY 2016 is determined based on the average locally sourced income and share from national tax collection for the past 3 years plus CY 2016 Final IRA DBM estimate. 3) Annual Amortization of existing loans were based from the availed loans from the _____________. 4) Net Borrowing Capacity is computed based on the annuity factor of ___________ (______%, _____ yrs). Prepared by: Noted by: _________________________ _________________________ Financial Analyst Regional Director Date Prepared _________________________ Note: To be included as enclosure in the indorsement letter to be sent to BLGF-CO after the preliminary computation of Net Debt Service Ceiling and Net Borrowing Capacity. ATTACHMENT A BLGF Checklist of Requirements for the Certification NDSC and BC Pursuant to DOF DO No. 054.2016 dated 25 October 2016 Name of LGU: ______________________ Date of Application: _____________ REQUIREMENTS or X COMMENTS 1. Letter request from the Local Chief Executive _____ indicating: i. The lending institution; _____ ii. Terms and conditions of the proposed loan; and _____ iii. The purpose of the loan. _____ 2. Certification of existing/absence of loan/s duly certified by the Local Treasure r with the following details _____ i. Types of loans & other obligations contracted; _____ ii. Purpose of the loans & other obligations contracted; _____ iii. Name of the lending institutions; _____ iv. Date of approval & maturity; _____ v. Terms & conditions (interest rate & number of years to pay); _____ vi. Remaining balances of loans and other obligations; and _____ vii. Annual amortization schedules (segregating the principal from the interest) issued by the lending institution _____ 3. Commission on Audit (COA) Annual Audit Certificate for the most recent year, which shall be supported by the year-end financial reports for the past three (3) years: _____ 20___ 20___ 20___ i. Pre-closing Trial Balance (GF) _____ _____ _____ ii. Detailed Statement of Financial Performance _____ _____ _____ An Agency Action Plan and Status of Implementation (AAPSI) report on COA recommendations shall be required if the LGU has adverse findings. 4. Certification issued by the lending institution stating that it _____ shall not require LGU deposits as compensating balance for the loan , if such lending institution is (1) not an authorized government depository bank or (2) an authorized government bank required to obtain the prior approval of the Department of Finance, as provided under the DOF Department Circular No. 002-2016 dated 8 July 2016. In case the LGU has been declared under the state of calamity either by the national or local authorities shall, for a period of one (1) year from the declaration of state of calamity, be required only to submit the documents stated in Item Nos. 1 and 2, together with certified copy of the declaration. Prepared and Evaluated by: Date of Evaluation: ___________________ ___________________ Financial Analyst ATTACHMENT B Notice of Deficiency in Documentary Requirements _____________ Date Hon. _______________ ____________________ ____________________ Dear Mayor/Governor __________: This refers to your letter dated ______________ date requesting for the issuance of a Certificate of Net Debt Service Ceiling and Net Borrowing Capacity of the ___________________ name of LGU for its loan application with the ____________________ Name of Financing Institution , for the _______________________ (state purpose of the loan) . SDAaTC In this connection and in order to complete the assessment of your application and determine the financial viability of the proposal, please submit to this Office the soonest possible time the documents marked X in the attached checklist, per DO No. 054.2016, dated 25 October 2016. Please be reminded that should this Bureau fail to receive any information regarding the matter within thirty (30) days from receipt hereof, said request shall be returned without action. Thank you. Very truly yours, ________________________ Regional Director ATTACHMENT C Notice of Return of Letter Request without Action _____________ Date Hon. _______________ ____________________ ____________________ Dear Mayor/Governor __________: This refers to your letter dated ___________ date requesting for the issuance of a Certificate of Net Debt Service Ceiling and Net Borrowing Capacity of the _______________________ name of LGU for its loan application with the ______________________ Name of Financing Institution , for the ___________________ (state purpose of the loan) . In connection therewith, since thirty (30) working days have lapsed and no reply was received from your Office, per our letter request dated _____________ date , requiring the submission of the lacking documents to facilitate the request (copy attached), we regret to return your letter request without action. Thank you. Very truly yours, ________________________ Regional Director LGU TEMPLATE A Sample LCE Letter of Application _____________ Date OIC EXECUTIVE DIRECTOR NIO RAYMOND B. ALVINA Bureau of Local Government Finance Department of Finance 8th floor, EDPC Bldg., BSP Complex, Roxas Blvd., Malate, Manila Thru: _______________________________ (Name of Regional Director) _______________________________ (Address of BLGF-Regional Office) Dear Director ALVINA: Relative to the loan application of the ______________ (Name of LGU) , with the ___________________ (Name of Financing Institution) , may we request for the issuance of Certificate of Net Debt Service Ceiling and Net Borrowing Capacity from that Office, with the following information provided for your reference/consideration: acEHCD Credit Facility Term of Loan Amount of Loan (Specific Purpose of Loan) Indicate the purpose of Indicate the number of Indicate the amount of the loan (state what years to pay including proposed loan exactly it is in the grace period and the approved Resolution) interest rate Add rows for other additional information as may be necessary Attached are the documents required to facilitate our request in compliance with DOF DO No. 054.2016, dated 25 October 2016, to wit: 1. Certification by the Local Treasurer of presence or absence of loan/loans duly certified by the Local Treasurer; 2. Commission on Audit (COA) Annual Audit Certificate for the most recent year, which supported by the year-end financial reports for the past three (3) years; 3. Certification issued by the lending institution stating that it shall not require LGU deposits as compensating balance for the loan. Thank you. Very truly yours, _________________________ Name and Signature Title of LCE LGU TEMPLATE B Sample Certification of Local Treasurer on Existing Loans/Absence of Loans CERTIFICATION This is to certify that the ___________________ (Name of LGU) has (state whether the LGU has an existing loan or has no existing loan). Financing Institution Type of Loan Purpose Amount Date Availed Date of Maturity Interest Rate Tenor (# of years to pay) Outstanding Balance as of _____ 1. 2. 3. Add rows as may be necessary Attached is/are the amortization schedule/s for reference. This certification is issued in support of the request of the __________________ (Name of LGU) for the issuance of the Certificate of Net Debt Service Ceiling and Net Borrowing Capacity from the Bureau of Local Government Finance. Done this __________ Date , at ________________ (Name of LGU) , Philippines. _______________________________ (Name and Signature) Provincial/City/Municipal Treasurer LGU TEMPLATE C Status of Implementation of Prior Year's Audit Recommendations Status of Implementation of Prior Year's Audit Recommendations CY ______ Annual Audit Report Audit Observation Recommendations Management Action Status of Implementation Reason/s for Partial or Non Implementation 1 2 3 Name and Signature of Concerned LGU Officials LGU TEMPLATE D Sample Certification of Local Accountant on Default in Loan Payment CERTIFICATION This is to certify that the ______________ (LGU Name) has _________________________ (state whether the LGU defaulted or not) in the payment of amortization of its existing loan/s. (Provide details of the loan where there was a default in payment.) SDHTEC Done this ______________ Date at _____________________ Name of LGU , Philippines. _______________________________ (Name and Signature) Provincial/City/Municipal Accountant