Abstract:
With the advent of the Local Government Code (LGC) of 1991, significant
changes had happened with regards to the role and significance of local
government units (LGUs) in the local setting. This became possible because the
LGC granted the LGUs with additional revenue sources and a larger share in the
national government budget 一 the Internal Revenue Allotment (IRA).
Among the devolved functions specified in the law is the responsibility to
carry out the development process in the local context. This is operationalized
with the statutory requirement of spending 20% of IRA on development projects.
This research paper looks at one case in particular 一 Olongapo City. The
research has used library and archival research coupled with interviews to
determine what the impacts of IRA are with regards to the choice and
implementation of development programs. It also tried to look at the perception of
Olongapenos with regards to these programs.
Unlike other less blessed LGUs, Olongapo City does not see budget
limitation as a problem with regards to its development programs. This is
because the LGU resorts to other ways to finance these through BOTs, loans,
and increasing its revenues through the restructuring and updating its tax
collection system.
At the end, it was recommended that the city look at its expenditure
priorities and give equal priority to the intangible side of development which is the
improvement in the quality of lives of Olongapenos by increasing its expenditure of social services. Furthermore, the focus of the programs of the city should be
geared towards empowering the people by encouraging them to go in their own
businesses. In this way, Olongapenos would no longer depend upon the LGU to
provide them with employment opportunity. A restructuring of IRA was also
suggested towards a system that takes into consideration the net fiscal
capacities of LGUs in order to encourage them to increase their tax collection.
