E. Classification of provinces, cities and municipalities (Read E.O.

349)

This act is entitled “providing for a new income classification of provinces, cities and other municipalities” Pertinent provisions
include:

Sec. 1. Classification of provinces and cities. Provinces and cities except Manila and Quezon City, which shall be considered as
special class cities, are hereby divided into 6 main classes according to the annual average income they actually realized during
the last 4 calendar years immediately preceding as follows: a) First class P30M or more b) Second class P20M-P30M; c) Third
class P15M-P20M; d) Fourth class P10M-15M, e) Fifth class P5M-10-M; f) Sixth class less than P5M

Sec. 2. Classification of Municipalities x x x according to the annual average income they actually realized during the last 4
calendar years immediately preceding as follows; a) First class, P15M or more b) second class, P10M-15M c) Third class, P5M-
10M d) fourth class P3M-P5M e) Fifth class, P1M-3M f) Sixth Class, less than P1M.

Sec. 3. Period of General Reclassification of Province, Cities and Municipalities. Upon the effectivity of this E.O. and for each
period of 4 consecutive calendar years thereafter, the Secretary of Finance shall reclassify the all provinces, cities, except
Manila and Quezon City, Which shall remain as special class cities, and municipalities, on the basis of the foregoing schedules
of the average annual income of each province, city or municipality derived during the last 4 consecutive calendar years
immediately such reclassification according to the provisions hereof.

Sec. 4. Definition of Terms. As used this E.O. a. Annual Income revenues and receipts realized by provinces, cities and
municipalities from regular sources of the local general and infrastructure funds including the internal revenue and specific tax
allotments provided for in PDs 144 and 436, both as amended but exclusive of non-recurring receipt, such as other national ads,
grants, financial assistance, loan proceeds, sales of fixed assets and similar others b. Average annual income- sum of the
“annual income”- sum of the “Annual Income” as herein defined actually obtained by a province, cities and municipalities.

Sec. 5 Use of income classification of provinces, cities, and municipalities. xxx as basis for: a) Fixing of maximum tax ceiling
imposable by the local government b) Determination of statutory and administrative aids, Financial grants and other forms of
assistance to local government c) Establishment of salary scales and rates of allowances per diems, and other emoluments that
local government officials and personnel may be entitled to d) Implementation of personnel policies on promotions, transfers,
details or secondment, and related matters at the local government levels e) formulation and execution of local government
budget policies and f) Determination of the financial capability of local government units to undertake development programs
and priority projects

NOTE: There are 7 more sections, mainly on salaries and taxes- you know, ways to put more money into the pocket of our
bureaucrats

*Sec. 15 definition and policy. There is a boundary dispute when a portion or a whole of the territorial area of an LGU is claimed
by 2 or more LGUs. Boundary disputes between or among LGUs shall, as much as possible, be settled amicably.

* Sec.16 Jurisdictional Responsibility. Boundary disputes shall be referred for settlement to the following:
a. Sangguniang Panlungsod or Sangguniang for those involving 2 or more barangays in the same city or municipality as the
case may be.
b. Sangguniang Panlalawigan for those involving 2 or more municipalities with in the same province.
c. Jointly, to the Sanggunian of provinces concerned, for those involving component cities or municipalities of different provinces.
d. Jointly, to the respective Sangguniang for those involving a component city or municipality and highly urbanized
city of 2 or more highly urbanized cities.

* Sec. 17 Procedures for settling Boundary Disputes they are

1) filing of petition
2) contents of petition
3) documents attached to petition (e.g. provincial, city or barangay map as the case may be technical description of the
boundaries of the LGUs concerned
4) Joint hearing
5) failure to settle amicably (a certification shall be submitted to the effect 6) Decision 7) Appeal (To the proper RTC)

*Sec 18. Maintenance of Status Quo. Pending final resolution of the dispute, the status of the affected area prior to the dispute
shall be maintained and continued for all purposes.

* Sec 19. Official Custodian. The DILG shall be the official custodian of all documents on boundary disputes of
LGUs.