Supplemental Guidelines to the DBM-DOF-DILG Joint Memorandum Circular (JMC) No. 2, S. 2020
The DILG Memorandum Circular No. 2020-168 supplements the DBM-DOF-DILG Joint Memorandum Circular No. 2, S. 2020, providing guidelines for local government units (LGUs) regarding the use of unexpended cash balances for COVID-19 related expenses under the Bayanihan to Recover as One Act (RA No. 11494). It clarifies that funds from various DILG-administered projects held in trust by LGUs must adhere to specific project guidelines and can only be transferred to general funds under certain conditions, including certification of feasibility issues. The memorandum emphasizes the responsibilities of local officials to ensure compliance with budgeting and auditing regulations. It is effective immediately and aims to enhance the accountability and transparency of fund utilization during the pandemic.
December 4, 2020
DILG MEMORANDUM CIRCULAR NO. 2020-168
SUPPLEMENTAL GUIDELINES TO THE DBM-DOF-DILG JOINT MEMORANDUM CIRCULAR (JMC) NO. 2, S. 2020 POLICY GUIDELINES ON THE IMPLEMENTATION OF CERTAIN PROVISIONS OF THE BAYANIHAN TO RECOVER AS ONE ACT (REPUBLIC ACT [RA] NO. 11494) PERTAINING TO LOCAL GOVERNMENT UNITS (LGUS)
1. Background
Republic Act (RA) No. 11494 or the Bayanihan to Recover as One Act, enacted on 11 September 2020, intends to further strengthen the government's COVID-19 response and recovery efforts as it adopted measures and employed strategies to boost socio-economic activities. HTcADC
To guide the implementation of specific provisions of RA No. 11494 with implications on local government operations, the Department of Budget and Management (DBM), Department of Finance (DOF), and DILG issued Joint Memorandum Circular (JMC) No. 2, S. 2020 Policy Guidelines on the Implementation of Certain Provisions of the Bayanihan to Recover as One Act (Republic Act [RA] No. 11494) Pertaining to Local Government Units (LGUs), dated 4 December 2020.
While the JMC clarified specific provisions of the Bayanihan 2 Law applicable to LGUs, Section 4 (lll) on the use of unexpended cash balances held in trust by LGUs for COVID-19 related expenses need to be clarified within the context of DILG-administration of projects. This is in consideration of the wide range of National Government (NG)-administered projects/programs implemented by LGUs with fund utilization dictated by legal instruments and policies issued to guide project/program implementation.
2. Purpose
This Memorandum Circular (MC) is being issued to clarify Section 2.9 of the DBM-DOF-DILG JMC No. 2, S. 2020 (Section 4 [lll] of the Bayanihan 2 Law) specifically on the utilization of unexpended cash balances of funds from various DILG-administered projects/programs, held in trust by LGUs, the utilization of which are governed by project-specific guidelines.
3. Coverage
This MC covers all Provincial Governors, Component City/Municipal Mayors, Sangguniang Panlalawigan/Panlungsod/Bayan, DILG Regional/Provincial/City Directors, and others concerned.
4. Policy Content and Guidelines
Section 2.9 of the DBM-DOF-DILG JMC No. 2, S. 2020 provides for the qualifying conditions; general guidance on exemptions; and the accounting of transferred funds through budgetary instruments and assistance from the Commission on Audit (COA).
The projects/programs administered by various agencies that are to be implemented by LGUs, downloads funds to beneficiary LGUs for the implementation of activities in line with the attainment of project/program objectives or purpose with defined expected outputs and deliverables. Utilization of funds, and cancellation/termination of these projects are governed by project policies, guidelines, and other legal instruments.
4.1. For all NG-administered projects with funds held in trust by LGUs:
4.1.1. For Local Government Support Fund (LGSF) projects appropriated from the FY 2018, 2019, and 2020 General Appropriations Act (GAA), sub-items a and b of Section 2.9.1 of DBM-DOF-DILG JMC No. 2, S. 2020 shall apply. Said unexpended cash balances shall not be transferred for reasons stated therein.
4.1.2. For all other projects not covered under Section 4.1.1 determined by the LGU to be no longer feasible to implement or complete at no fault of the concerned LGU and no longer economically and/or technically viable, LGUs should issue a certification to this effect signed by the Local Chief Executive, Local Accountant, and other concerned officials.
Once certified, funds can be transferred to the general fund and shall be made available in response to the COVID-19 pandemic subject to the usual accounting rules and regulations.
4.1.3. All funds transferred from the trust fund to the general fund must be accounted for in accordance with auditing and accounting rules and regulations. LGUs shall submit to the source agency: (i) proof of actual unexpended cash balance, (ii) proof of transfer to general fund, and (iii) the corresponding appropriation ordinance.
4.2. For projects of sector agencies held in trust by LGUs governed by policies, guidelines, and legal instruments issued by such agency/ies, LGUs are advised to directly consult with concerned agency/ies.
5. Responsibility, Accountability, and Transparency
Consistent with Sections 3.0 Monitoring and Reporting and 4.0 Responsibility and Accountability of the DBM-DOF-DILG JMC No. 2, S. 2020.
5.1. The responsibility and accountability for the proper implementation of this MC shall rest upon the Local Chief Executives and other local officials concerned. The responsible officials shall ensure that the funds are utilized strictly in accordance with applicable budgeting, accounting, auditing rules and regulations and pertinent provisions of RA No. 9184.
5.2. All LGUs are enjoined to comply with the reporting and posting requirements as prescribed under pertinent laws, rules, and regulations.
6. Effectivity
This MC shall take effect immediately.
7. Approving Authority
(SGD.) EDUARDO M. AÑOSecretary
8. Feedback
Inquiries concerning this MC should be directed or addressed to the Bureau of Local Government Development (BLGD) through any of the following: telefax numbers (02) 929-9235/(02) 927-7852, e-mail at [email protected], or through mail at 25th Floor, DILG-NAPOLCOM Center, EDSA corner Quezon Avenue, West Triangle, Quezon City for resolution and appropriate action. aScITE
ATTACHMENT
DBM-DOF-DILG Joint Memorandum Circular No. 002-20