EXECUTIVE ORDER NO. 807 June 10, 1982
ESTABLISHING THE SMALL CONTRACTORS MODULE UNDER THE KILUSANG KABUHAYAN AT KAUNLARAN AND FOR OTHER PURPOSES
WHEREAS, the Government has launched the kilusang Kabuhayan at Kaunlaran (KKK) as a nationwide movement to mobilize local resources for the establishment of viable productive enterprises that will provide sources of livelihood in the community;
WHEREAS, locally-based contractors can be utilized to undertake the construction and maintenance of support facilities required by KKK projects particularly farm-to-market roads, markets, water supply systems and the social facilities such as school and health centers;
WHEREAS, there are thousands of small contractors groups employing a large number of laborers all over the country, many of which have been and tend to remain perennial sub-contractors and informal labor groups offering their services to the larger and more established contractors and owner/clients not only for private construction jobs but also for community projects such as roads, markets, schools, public buildings, drainage, water supply facilities and other social facilities;
WHEREAS, while these small contractors have manifested the...
Details
n/a
n/a
Executive Orders
Establishing the Small Contractors Module Under the Kilusang Kabuhayan at Kaunlaran and for Other Purposes
Executive Order No. 807
Summary of Executive Order No. 807
Establishment of Small Contractors Module
- A "small contractors module" is established as part of the Kilusang Kabuhayan at Kaunlaran (KKK) program. (Sec. 1)
Types of Projects
- KKK assistance under this module may be extended for public works and highways projects with an estimated contract cost of not more than P700,000.00 each, such as school buildings, barangay roads, flood control and drainage works, communal irrigation, wells, health centers, and similar projects. (Sec. 2)
Prospective Beneficiaries and Prequalification Requirements
- Legal Requirements:
- The applicant must be a Filipino citizen, of legal age, and in good standing in the community, or a partnership/cooperation fully owned by Filipino citizens. (Sec. 3a.i)
- The key officer of the applicant must be a bona fide resident for the past 3 years in the region where the project is located. (Sec. 3a.ii)
- The applicant must submit a sworn statement to procure unskilled workers from the municipality/city where the project is located, and semi-skilled workers from the province. (Sec. 3a.iii)
- Technical Requirements:
- The applicant or key construction staff must have satisfactorily completed projects with aggregate costs of at least 10% of the estimated contract cost, involving similar technology. (Sec. 3b.i)
- The applicant must own basic construction tools. (Sec. 3b.ii)
- The applicant must have a construction foreman with at least 1 year of experience in similar work. (Sec. 3b.iii)
- Financial Requirement:
- The applicant must have a positive net worth based on the latest income tax return. (Sec. 3c)
Types of KKK Assistance
- Loan at 12% interest per annum, repayable as per Sec. 6, to cover:
- Working capital requirement, not exceeding the estimated operating expenses for 1.5 months or 15% of the estimated contract cost, whichever is lesser. (Sec. 4a)
- Cost of purchasing light construction equipment, not exceeding 15% of the estimated contract cost. (Sec. 4b)
- KKK designated banks may post the following bonds on behalf of the contractor:
- Bid bond of at least 2.5% of the bid price. (Sec. 4a)
- Performance bond of at least 5% of the contract price. (Sec. 4b)
Financing Institutions
- KKK financing will be extended by KKK designated banks or other authorized financing institutions. (Sec. 5)
Procedures
- Prequalification:
- The government agency concerned shall invite interested contractors to apply for prequalification and KKK assistance for the project. (Sec. 6a.i)
- The contractor shall submit applications for prequalification and KKK assistance. (Sec. 6a.ii)
- The agency shall evaluate the prequalification statement and endorse the KKK assistance application to the KKK Regional Action Officer (RAO) if approved. (Sec. 6a.iii)
- Processing of KKK Assistance Application:
- The RAO shall evaluate the application and issue a statement to endorse the loan to the KKK-designated bank if the contractor is awarded the contract. (Sec. 6b)
- Submission of Bid:
- The contractor shall submit the bid along with the RAO's statement. (Sec. 6c)
- Award and Perfection of Contract:
- If the contractor is awarded the contract, the RAO shall confirm the loan, and the contract is perfected and approved. (Sec. 6d)
- Deposit of Project Funds:
- The implementing agency shall deposit the project funds with the KKK-designated bank, earning interest equal to the Central Bank's rediscounting rate, which shall accrue to the National Government Treasury. (Sec. 6e)
- Loan for Working Capital:
- The RAO shall communicate with the KKK-designated bank to extend the loan to the contractor. (Sec. 6f.i)
- The contractor shall assign his rights under the contract to the KKK-designated bank to receive loan amortization payments deducted from progress payments. (Sec. 6f.i)
- The agency shall issue a check to the KKK-designated bank for the loan amortization and interest, and a separate check to the contractor for the balance of the progress payment. (Sec. 6f.ii)
- Loan for Purchase of Equipment:
- The RAO shall endorse the contractor's loan application to the KKK-designated bank. (Sec. 6g.i)
- The contractor shall execute a chattel mortgage in favor of the KKK-designated bank. (Sec. 6g.i)
- The loan is amortized out of the progress payments. (Sec. 6g.ii)
- Default:
- If the contractor fails to fulfill contractual obligations resulting in contract termination, standard KKK guidelines shall apply. (Sec. 6h)
- The contractor shall be blacklisted by the government agency and financing institution, without prejudice to civil or legal actions. (Sec. 6h)
Implementing Details
- The Minister of Public Works and Highways, in coordination with the KKK National Secretariat, shall promulgate the appropriate implementing details, forms, and circulars. (Sec. 7)
Repealing and Modifying Clause
- All laws, decrees, executive orders, administrative orders, rules and regulations, including provisions of the implementing rules and regulations of Presidential Decree No. 1594 (Contract Policies and Procedures), in conflict with this Executive Order are repealed or modified accordingly. (Sec. 8)
Separability Clause
- Any portion declared unconstitutional shall not nullify the other portions, provided the remaining portions can still stand and accomplish the objectives of this Executive Order. (Sec. 9)
Effectivity
- This Executive Order shall take effect immediately. (Sec. 10)
Establishment of Small Contractors Module
- A "small contractors module" is established as part of the Kilusang Kabuhayan at Kaunlaran (KKK) program. (Sec. 1)
Types of Projects
- KKK assistance under this module may be extended for public works and highways projects with an estimated contract cost of not more than P700,000.00 each, such as school buildings, barangay roads, flood control and drainage works, communal irrigation, wells, health centers, and similar projects. (Sec. 2)
Prospective Beneficiaries and Prequalification Requirements
- Legal Requirements:
- The applicant must be a Filipino citizen, of legal age, and in good standing in the community, or a partnership/cooperation fully owned by Filipino citizens. (Sec. 3a.i)
- The key officer of the applicant must be a bona fide resident for the past 3 years in the region where the project is located. (Sec. 3a.ii)
- The applicant must submit a sworn statement to procure unskilled workers from the municipality/city where the project is located, and semi-skilled workers from the province. (Sec. 3a.iii)
- Technical Requirements:
- The applicant or key construction staff must have satisfactorily completed projects with aggregate costs of at least 10% of the estimated contract cost, involving similar technology. (Sec. 3b.i)
- The applicant must own basic construction tools. (Sec. 3b.ii)
- The applicant must have a construction foreman with at least 1 year of experience in similar work. (Sec. 3b.iii)
- Financial Requirement:
- The applicant must have a positive net worth based on the latest income tax return. (Sec. 3c)
Types of KKK Assistance
- Loan at 12% interest per annum, repayable as per Sec. 6, to cover:
- Working capital requirement, not exceeding the estimated operating expenses for 1.5 months or 15% of the estimated contract cost, whichever is lesser. (Sec. 4a)
- Cost of purchasing light construction equipment, not exceeding 15% of the estimated contract cost. (Sec. 4b)
- KKK designated banks may post the following bonds on behalf of the contractor:
- Bid bond of at least 2.5% of the bid price. (Sec. 4a)
- Performance bond of at least 5% of the contract price. (Sec. 4b)
Financing Institutions
- KKK financing will be extended by KKK designated banks or other authorized financing institutions. (Sec. 5)
Procedures
- Prequalification:
- The government agency concerned shall invite interested contractors to apply for prequalification and KKK assistance for the project. (Sec. 6a.i)
- The contractor shall submit applications for prequalification and KKK assistance. (Sec. 6a.ii)
- The agency shall evaluate the prequalification statement and endorse the KKK assistance application to the KKK Regional Action Officer (RAO) if approved. (Sec. 6a.iii)
- Processing of KKK Assistance Application:
- The RAO shall evaluate the application and issue a statement to endorse the loan to the KKK-designated bank if the contractor is awarded the contract. (Sec. 6b)
- Submission of Bid:
- The contractor shall submit the bid along with the RAO's statement. (Sec. 6c)
- Award and Perfection of Contract:
- If the contractor is awarded the contract, the RAO shall confirm the loan, and the contract is perfected and approved. (Sec. 6d)
- Deposit of Project Funds:
- The implementing agency shall deposit the project funds with the KKK-designated bank, earning interest equal to the Central Bank's rediscounting rate, which shall accrue to the National Government Treasury. (Sec. 6e)
- Loan for Working Capital:
- The RAO shall communicate with the KKK-designated bank to extend the loan to the contractor. (Sec. 6f.i)
- The contractor shall assign his rights under the contract to the KKK-designated bank to receive loan amortization payments deducted from progress payments. (Sec. 6f.i)
- The agency shall issue a check to the KKK-designated bank for the loan amortization and interest, and a separate check to the contractor for the balance of the progress payment. (Sec. 6f.ii)
- Loan for Purchase of Equipment:
- The RAO shall endorse the contractor's loan application to the KKK-designated bank. (Sec. 6g.i)
- The contractor shall execute a chattel mortgage in favor of the KKK-designated bank. (Sec. 6g.i)
- The loan is amortized out of the progress payments. (Sec. 6g.ii)
- Default:
- If the contractor fails to fulfill contractual obligations resulting in contract termination, standard KKK guidelines shall apply. (Sec. 6h)
- The contractor shall be blacklisted by the government agency and financing institution, without prejudice to civil or legal actions. (Sec. 6h)
Implementing Details
- The Minister of Public Works and Highways, in coordination with the KKK National Secretariat, shall promulgate the appropriate implementing details, forms, and circulars. (Sec. 7)
Repealing and Modifying Clause
- All laws, decrees, executive orders, administrative orders, rules and regulations, including provisions of the implementing rules and regulations of Presidential Decree No. 1594 (Contract Policies and Procedures), in conflict with this Executive Order are repealed or modified accordingly. (Sec. 8)
Separability Clause
- Any portion declared unconstitutional shall not nullify the other portions, provided the remaining portions can still stand and accomplish the objectives of this Executive Order. (Sec. 9)
Effectivity
- This Executive Order shall take effect immediately. (Sec. 10)