The Commission on Elections thru the Campaign Finance Office issued an advisory pertaining to the prohibition stated in Section 261 (v) and (w) of the Omnibus Election Code that will provide answers to various inquiries.
Elements that Constitute Violations of Section
261(v) and (w) of the Omnibus Election Code
Before discussing how the CFO processes and/ or evaluates the requests for exemption from Section 267 (v) and (w), it is essential to establish the basic foundational elements of what constitutes a violation of Section 261, (v) and (w).
Elements of a Section 261 (v) (1) violation:
1. The offender is a public official/employee, barangay official, GOCC officer/employee, GOCC's subsidiaries' officer/employee;
2. Purpose for the public fund release is for any and all kinds of public works, except those enumerated in Section 261(v) (1);
3. Public funds were released, disbursed or expended within the 45-day period before election day (25 March - 09 May 2016).
Elements of a Section 261 (v) (2) violation:
1. The offender is the DSWD and other government offices performing similar functions (such as the Social Welfare and Development Offices of the LGUs);
2. Purpose for the public fund release is for any purpose except the salary of their personnel, and other routine and normal expenses;
3. Release, disbursement or expenditure of public funds were done without authority of the COMELEC which can only be granted after due notice and hearing.
4. Public funds were released, disbursed or expended within the 45-day period before elections (25 March - 08 May 2016);
Elements of a Section 261 (v) (3) violation:1. The offender is the agencies, GOCCs and their subsidiaries that were attached to the now defunct Ministry of Human Settlements (current agencies are the National Housing Authority, Housing & Land Use Regulatory Board, National Home Mortgage Finance Corporation to name a few);2. Purpose for the public fund release is for any purpose except the salary of their personnel, and other necessary administrative expenses;
3. Public funds were released, disbursed or expended within the 45-day period before elections (25 March - 08 May 2016).
Elements of a Section 261 (w) (a) violation:
1. The offender can be any person;
2. He/she undertakes the construction of any public works, except those Iisted as exempted in Section 267 (v) (1);
3. Undertaking was done within the 45-day period before elections (25 March - 08 May 2016).
Elements of a Section 261 (w) (b) violation:
1. The offender can be any person;
2. He/she issued, used or availed of treasury warrants or any device undertaking future delivery of money, goods or other things of value chargeable against public funds; and
4. The issuance/use/availment of the treasury warrant or device occurred within the 45-day period before elections (25 March - 08 May 2016).
Definition of Public Works by the Supreme Court in Guzman v. COMELEC & Ting (G.R. N o. 782380. 28 August 2009)
In the Guzman case, the Supreme Court had the opportunity to define public works as follows:
Accordingly, absent an indication of any contrary legislative
intention, the term public works as used in Section 261 (v) of the Omnibus Election Code is properly construed to refer to any building or structure on land or to structures (such as roads or dams) built by the Government for whether of construction or adaptation undertaken and carried out by the national, state, or municipal authorities, designed to sub serve some purpose of public necessity, use or convenience, such as public buildings, roads, aqueducts, parks, etc.; or, in other words, all fixed works constructed for
public use.
The acts sought to be punished in Guzman were alleged violations of Section 261 (v) and (w) of the OEC, when City Mayor Ting and City Treasurer Garcia issued a treasury warrant as payment for purchase of parcels of land to be
used by the Tuguegarao City Government as a public cemetery. The treasury warrant was issued during the 45-day ban before the 09 May 2004 NLE. The SC held in this case that:
1. The COMELEC had no basis to indict the respondents for violation of Section 261 (v) because the public funds disbursement was for the purpose of purchasing parcels of land for use as a public cemetery; but
2. The COMELEC is directed to file the appropriate criminal information against respondents Ting and Garcia for violation of Section 267 (w) (b) of the OEC.
General Rule: No Blanket Exemption Granted to Any Government Agency or Private lndividual from the Prohibitions stated in Section 261 (v) &(w) of the OEC
The main reason why Rule 14 of the OMNIBUS RULES ON CAMPAIGN FINANCE uses the term "Certificate of Exception" instead of "Exemption" is to stress the fact that the Certificate only attests that the public works mentioned in the Certificate falI within the "exceptions" provided under Section 267 (v) (1) of the OEC. These exceptions are disbursements of public funds that are related to:
(a) Maintenance of existing and/or completed public works projects;
(b) Work undertaken by contract through public bidding held or by negotiated contract awarded before 25 March 2016 (start of the 45-day ban);
(c) Payment for the usual cost of preparation for working drawings, specifications, bills of materials, etc. - procedures preparatory to actual construction including purchases of materials and equipment, and all incidental expenses for wages of watchmen (security guards) and other laborers employed for such work in the central office and field storehouses before 25 March 2016;
(d) Emergency work necessitated by the occurrence of a public calamity, but such work shall be limited to the restoration of the damaged facility.
(e) Ongoing public works projects cornmenced/started before 25 March 2016;
(f) Public works projects under foreign agreements (foreign-assisted or foreign-funded projects).
Given this enumeration of exceptions, the CFO can only process requests for the issuance of a Certificate of Exception if the requesting party submits the documentary requirements listed in Sections 2 to 6, Rule 14 of the OMNIBUS RULES ON CAMPAIGN FINANCE, restated here for your convenience:
Section 2. Maintenance of existing and/or completed
public works project; documentary requirements. - For exceptions described under Section 261 (v) (1) (a) of the OEC, the following documents must be submitted by the party requesting for the Certificate of Exception:
(a) Certified true copy of the certificate of completion of the public works project;
(b) Certified true copy of the letter of acceptance of the public works project;
(c) Certified true copy of the contract covering the maintenance work being done on the existing/completed public works project;
(d) A notarized or sworn undertaking or commitment not to allow or permit more than X number of employees/laborers to work during 25 March 2O16 to 08 May 2016; and
(e) A notarized or sworn undertaking or commitment not to hire or employ additional laborers/employees that would exceed X number from 25 March 2016 to 08 May 2016.
ln relation to numbers (4) and (5), X represents the average number of employees/laborers already employed during the 6-month period before 25 March 2016, computed as follows:
X=
[(# of employees as of 24 October 2015) + (# of employees as of 24 November 2015) + (# of employees as of 24 December 2015) + (# of employees as of 24 January 2016) + (# of employees as of 24 February 2016) + (# of employees as of 24 March 2016)] + 6
SECTION 3. Public works projects undertaken by contract through public bidding or by negotiated contract awarded, before 25 March 2016; documentary requirements. - For exceptions provided under Section 261 (v) (1) (b) of the OEC, the following documents must be submitted by the party requesting for the Certificate of
Exception:
(a) Certified true copy of the notice of award of contract;
(b) Certified true copy of the notice to proceed with the public works project; and
(c) Certified true copy of the contract agreement.
(d) ln the case of negotiated contracts, the requesting party must submit:
(1) Certified true copy of the negotiated contract; and
(2) An official document showing the basis for proceeding to a negotiated contract, such as a Bid and Awards Committee (BAC) report or resolution declaring previous failed biddings, small value procurement, lease, emergency cases, and other similar documents.
SECTION 4. Payment for the usual cost of preparation of
public works project for working drawings, specifications, bills of materials, and estimates, purchase of materials and equipment, and other procedures preparatory to actual construction, and all incidental expenses for wages of watchmen and other laborers employed for such work in the central office and field storehouses before 25 March 2016; documentary requirements. - For exceptions provided under Section 261 (v) (1) (c) of the OEC, the following documents must be submitted by the party requesting for the Certificate of Exception:
(a) The statement of account, billing or collection invoice showing amount and date due evidencing the payment required to be released; and
(b) A sworn or notarized undertaking or commitment not to hire more laborers than number of laborers at commencement date of the project/s.
SECTION 5. Emergency work necessitated by the occurrence of a public calamity, but limited to the restoration of the damaged facility; documentary reguirements. - For exceptions provided under Section 261 (v) (1) (d) of the OEC, the following documents must be submitted by the party requesting for the Certificate of Exception:
(a) A certified true copy of the Executive Order or the Local Sanggunian Resolution declaring a state of calamity; and
(b) Documentation showing the scope of the emergency work needed, which must be limited to the restoration of the damage facility.
SECTION 6. Ongoing public works projects commenced
before the campaign period or other similar projects under foreign agreements. - For exceptions provided under the last paragraph of Section 261 (v) (1) of the OEC, the following documents must be submitted by the party requesting for the Certificate of Exception:
(a) Certified true copy of the foreign agreement/contract; and (b) List of works covered by the foreign agreement/contract.
Hence, the CFO will only be able to issue Certificates of Exception upon evaluation of the submitted documents. Absent these documents, the CFO will merely inform the requesting party of the documentary requirements and will not act on the request until the required documents have been submitted.
To date, the Commission En Banc has issued Minute Resolutions that serve as Certificates of Exceptions only to the following agencies: (1) MWSS; (2) DAR; and (3) DFA - Philippine Consulate in New York. The projects sought to be exempted by MWSS and DAR were foreign-assisted (ADB, JICA and other foreign aid agencies), while the DFA public works project in New York involved architectural services and repair of an existing public building.
Exception Not Listed in Section 267 (v): Build-
Operate -Transfer (BOT) Projects
Another exception recognized by the Commission En Banc pertains to public works projects that are contracted through the Build-Operate-Transfer (BOT) law. Even then documentary requirements were submitted by the requesting agency (Public-Private Partnership Center of the Philippines), which included a written explanation detailing the source of funding for the BOT projects, which are primarily sourced from the private sector. Since there are no public funds disbursed in the BOT projects, the Commission En Banc issued a confirmations stating that Section 267 (v) and (w) were not applicable to the BOT public works projects.
Requests Pertaining to Social Welfare Projects
(Non-lnfrastructure)
Most local government units have health and social welfare services that have been devolved to them by the Local Government Code (RA 7160, as amended), as listed in Section 17:
Section 17. Basic Services and Facilities. - x x x
(b) Such basic services and facilities include, but are not limited to, the following:
(1) For a Barangay:
(ii) Health and social welfare services which include maintenance of barangay health center and day-care center;
(2) For a Municipality:
(iv) Social welfare services which include programs and projects on child and youth welfare, family and community welfare, welfare of the elderly and disabled persons; community-based rehabilitation programs for vagrants, beggars, street children, scavengers, juvenile delinquents, and victims of drug abuse; livelihood and other pro-poor projects; nutrition services; and family planning services;
(3) For a Province:
(v) Social welfare services which include programs and projects on rebel returnees and evacuees; relief operations; and population development services;
Since these types of programs, projects and activities (PPAs) were originally lodged with the Department of Social Welfare and Development (DSWD) which were eventually devolved to the LGUs when the Local Government Code was enacted, we apply the notice and hearing requirement for DSWD in Section 261(v) (2) of the OEC, which reads:
Sec. 261 . Prohibited Acts. - The following shall be guilty of an election offense:
(v) Prohibition against release, disbursement or expenditure of public funds. - Any public official or employee including barangay officials and those of government-owned or controlled corporations and their subsidiaries, who, during forty-five (45) days before a regular
election and thirty (30) days before a special election, releases, disburses or expends any public funds for:
xxx
(2) The Ministry of Social Services and Development and any other office in other ministries of the government performing functions similar to said ministry, except for salaries of personnel, and for such other routine and normal expenses, and for such other expenses as the Commission may authorize after due notice and hearing. Should a calamity or disaster occur, all releases normally or usually coursed through the said ministries and offices of other ministries shall be turned over to, and administered and disbursed by, the Philippine National Red Cross, subject to the supervision of the Commission on Audit or its representatives, and no candidate or his or her spouse or member of his family within the second civil degree of affinity or consanguinity shall participate, directly or indirectly, in the distribution of any relief or other goods to the victims of the calamity or disaster; and x x x (Emphasis and underscoring supplied)
For these types of requests, the CFO has a standard reply informing the requesting party that they must submit their request for exemption from the ban in the form of a petition filed with the Clerk of the Commission.
Requests for Exemption Citing Section 104 of the OEC
Some, if not all, of the incumbent local elective officials go so far as to request for exemption from the coverage of Section 104, which reads:
Sec. 104. Prohibited donations by candidates, treasurers of parties or their agents. - No candidate, his or her spouse or any relative within the second civil degree of consanguinity or affinity, or his campaign manager, agent or representative shall during the campaign period, on the day before and on the day of the election, directly or indirectly, make any donation, contribution or gift in cash or in kind, or undertake or contribute to the construction or repair of roads, bridges, school buses, puericulture centers, medical clinics and hospitals, churches or chapels, cement pavements, or any structure for public use or for the use of any religious or civic organization: Provided, That normal and customary religious dues or contributions, such as religious stipends, tithes or collections on Sundays or other designated collection days, as well as periodic payments for legitimate scholarships established and school contributions habitually made before the prohibited period, are excluded from the prohibition.
The same prohibition applies to treasurers, agents or representatives of any political party.
Based on the said provision the elements of a Section 104 violation can be determined as follows:
1. The offenders are candidates, their spouses, relatives within the 2nd civil degree of consanguinity or affinity, their campaign managers, agents or representatives;
2. For political parties, the offenders are the party
treasurers, their agents or representatives;
3. They performed any of the following unlawful acts, whether directly or indirectly:
a. Made a donation contribution or gift in cash or in kind; or
b. Made an undertaking or contribution to the construction or repair of roads, bridges, school buses, puericulture centers, medical clinics and hospitals, churches or chapels, cement pavements, or any structure for public use or for the use of any religious or civic organization
c. Exceptions:
i. Normal or customary religious dues or contributions such as religious stipends, tithes or collections on Sunday or other designated collection days;
ii. Periodic payments for legitimate scholarships established and school contributions habitually made before the prohibited period (non-election years).
4. The act was committed during the campaign period, the day before or on election day.
Given the elements, it is clear that only candidates, spouses, relatives as well as political parties and their agents can be made liable under Section 104.
To date, the Commission En Banc has not granted any exemption to anyone from Section 104, except for the Philippine Charity Sweepstakes Office (PCSO), on the
simple ground that the PCSO, as a GOCC, is not a candidate or party.In Comelec Minute Resolution No. 16-0070, the En Banc adopted the position that PCSO, as a GOCC:
1. Cannot be made liable under Section 104;
2. Section 267 (o) remains applicable to the PCSO should it use any of its funds, which are public funds, for partisan political activity;
3. Section 261, (v) and (w) also remains applicable to PCSO.
Campaign Finance Office Contact lnformation
Should there by any questions or concerns regarding this advisory or other campaign finance matters, please do not hesitate to contact the Campaign Finance Office through any of the following means:
Telephone numbers: (02) 525-9334 and523-7084
E-mail address: campaignfinance@comelec.gov.ph
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