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PROVINCE OF PAMPANGA v. EXECUTIVE SECRETARY ALBERTO ROMULO

FACTS:

This case involves the validity and constitutionality of Executive Order No. 224 issued by President Gloria Macapagal-Arroyo on July 4, 2003. The Province of Pampanga filed a petition challenging the executive order, claiming that it violated the principle of local government autonomy, was an invalid exercise of presidential control, violated the equal protection clause, and constituted executive lawmaking. The Regional Trial Court issued a Temporary Restraining Order and later a Writ of Preliminary Injunction enjoining the implementation of the executive order. The trial court eventually declared Executive Order No. 224 invalid and unconstitutional, highlighting the importance of local government units exercising their taxing power. The trial court concluded that the exclusive power to impose taxes and collect fees on quarry resources belonged to the Province of Pampanga, and that the executive order encroached on their authority.

The trial court held Section 4 of Executive Order No. 224 unconstitutional, as it empowered a task force to collect taxes, fees, charges, and excise taxes. The trial court ruled that this provision went against the constitutional intent to empower local governments to create revenue sources, with Congress as the only authorized entity to limit such power. The trial court also struck down the entire executive order, declaring that the Province of Pampanga has the exclusive power and authority to issue permits and collect all local taxes, fees, and charges. The Court of Appeals reversed the trial court's decision, ruling that the provisions of Executive Order No. 224 did not conflict with the provincial governor's authority to issue permits. The Court of Appeals held that the distinction in the Philippine Mining Act limiting the governor's authority for certain applications was a valid modification of the Local Government Code. The Court of Appeals also held that Executive Order No. 224 did not interfere with the provincial government's tax collection efforts and was a valid exercise of the president's rule-making power. The Province of Pampanga filed a petition for review, arguing that the executive order was an invalid exercise of the president's power and encroached on its authority to raise and collect revenues and taxes.

The case revolves around the issuance of Executive Order No. 224 by President Gloria Macapagal-Arroyo on July 4, 2003. The purpose of the executive order is to regulate the extraction and disposition of sand, gravel, and lahar deposits in the provinces of Pampanga, Tarlac, and Zambales. The petitioner argues that the executive order violates its rights to due process, equal protection, and local fiscal autonomy, as provided by the Constitution and the Local Government Code. The respondents, the Executive Secretary and the Department of Environment and Natural Resources, argue that the executive order is a valid exercise of the president's power under the Philippine Mining Act and does not infringe on the petitioner's rights. The main issue before the Court is the validity and constitutionality of Executive Order No. 224.

The case concerns the issuance of an executive order by then President Gloria Macapagal-Arroyo, which aims to manage and utilize sand, gravel, and lahar deposits in the provinces of Pampanga, Tarlac, and Zambales. The executive order seeks to improve water flows, protect dikes and infrastructures, and reduce risks to lives and properties. It establishes a task force composed of the Mines and Geosciences Bureau (MGB) and the Provincial Governor to handle the issuance of permits for the extraction of these resources. The task force is also responsible for monitoring compliance, collecting taxes and fees, and enforcing against illegal mining and quarrying operations. The executive order emphasizes the importance of proper management and utilization of these deposits for the benefit of both local and national governments, with consideration for environmental concerns.

ISSUES:

  1. Whether or not Executive Order No. 224 was promulgated in accordance with the prescribed procedure.

  2. Whether or not Executive Order No. 224 supplants portions of the Local Government Code and the Philippine Mining Act.

  3. Whether Executive Order No. 224 is a valid exercise of legislative power delegated to the President.

  4. Whether Executive Order No. 224 is a valid exercise of the President's ordinance-making power.

  5. Whether or not provincial governments have the authority to issue permits and collect taxes on quarry resources within their territorial jurisdiction.

  6. Whether or not the Department of Environment and Natural Resources (DENR) has the authority to issue permits for quarry applications covering areas above five hectares.

  7. Whether Executive Order No. 224 is an ultra vires act.

  8. Whether Executive Order No. 224 disrespected the local government units' constitutionally mandated fiscal autonomy.

  9. Whether or not the task force created by Executive Order No. 224 had the authority to collect quarry fees and taxes.

  10. Whether or not the task force's oversight function violates local government units' fiscal autonomy.

  11. Whether or not Executive Order No. 224 is a valid and reasonable exercise of the president's inherent ordinance-making power.

RULING:

  1. The court presumed that Executive Order No. 224 was promulgated in accordance with the prescribed procedure.

  2. Executive Order No. 224 does not supplant portions of the Local Government Code and the Philippine Mining Act.

  3. Yes. Executive Order No. 224 is a valid exercise of legislative power delegated to the President. The President has the authority to adopt rules and regulations to carry out the provisions of law and implement legislative policy. However, such power must not supplant or modify existing laws, including the Constitution. The President must be guided by the standards established in the law being enforced to prevent him/her from making or unmaking the law. Executive Order No. 224 does not violate these principles and is therefore a valid exercise of delegated legislative power.

  4. Yes. Executive Order No. 224 is a valid exercise of the President's ordinance-making power. Apart from the rule-making power delegated by Congress, the President also has inherent ordinance powers as part of the power of executive control. These internal rules or instructions in the executive branch do not bind the public but are necessary for the efficient operation of the executive department. As such, the President has the authority to issue orders and instructions for the executive branch without the need for delegation from Congress. Executive Order No. 224 falls within this ordinance-making power and is therefore valid.

  5. Provincial governments have the authority to issue permits and collect taxes on quarry resources within their territorial jurisdiction. Section 138 of the Local Government Code empowers provincial governments to issue permits to quarry operators and collect taxes on extracted quarry resources.

  6. The DENR has the authority to issue permits for quarry applications covering areas above five hectares. The Philippine Mining Act limits the authority of provincial governments to issue permits only to quarry applications for areas below five hectares. The DENR, through the Mines and Geosciences Bureau, is empowered to issue permits for quarry applications covering areas above five hectares.

  7. Executive Order No. 224 is not an ultra vires act. State control over the local government units' compliance with and enforcement of quarrying-related activities is valid. The Executive Order simply reinforces the Philippine Mining Act.

  8. Executive Order No. 224 does not disrespect the local government units' constitutionally mandated fiscal autonomy. The task force created by the Executive Order acts as a supervisory mechanism, ensuring that the necessary taxes, fees, and charges are duly collected and remitted to the local government units.

  9. The task force does not have the authority to collect quarry fees and taxes. The Supreme Court held that the task force's authority to collect these fees and taxes should have been provided in the law itself and not just in the implementing rules and regulations. Therefore, the task force's authority to collect quarry fees and taxes is considered an amendment to the implementing rules and regulations, and not a valid delegation by the law.

  10. The task force's oversight function does not violate local government units' fiscal autonomy. The Supreme Court affirmed that the President's power of general supervision over local government units does not infringe on their constitutionally protected right of fiscal autonomy. The power to impose quarry fees and taxes remains with the local government units, and the full income from these fees and taxes will ultimately go to their coffers.

  11. Executive Order No. 224 is a valid and reasonable exercise of the president's inherent ordinance-making power. The Supreme Court held that the executive order provided necessary rules for the implementation of the Philippine Mining Act in relation to the quarry industry affected by Mt. Pinatubo's eruption. It did not go beyond the bounds of the law it was meant to implement and did not violate the Constitution.

PRINCIPLES:

  • The promulgation of an administrative issuance, such as an executive order, must comply with the requisites of validity, including authorization by the legislature, promulgation in accordance with the prescribed procedure, within the scope of the authority given by the legislature, and reasonableness.

  • The State has full control and supervision over mineral resources, as provided by the Philippine Mining Act and the Constitution.

  • The principle of separation of powers dictates that each branch of government has exclusive cognizance of matters falling within its constitutionally allocated powers.

  • Legislative power may be validly delegated to the President, but such power must not supplant or modify existing laws, including the Constitution.

  • In exercising delegated legislative power, the President must be guided by the standards established in the law being enforced.

  • The President's ordinance-making power is part of the power of executive control and does not require delegation from Congress.

  • Implementing rules and regulations issued by the President under delegated legislative authority create rights and obligations that affect the public at large, while internal rules or instructions in the executive branch do not bind the public.

  • The Local Government Code empowers provincial governments to issue permits and collect taxes on quarry resources within their territorial jurisdiction.

  • The Philippine Mining Act limits the authority of provincial governments to issue permits only to quarry applications for areas below five hectares and empowers the DENR, through the Mines and Geosciences Bureau, to issue permits for quarry applications covering areas above five hectares.

  • State control over local government units' compliance with and enforcement of quarrying-related activities is valid.

  • Executive orders that reinforce existing laws are not ultra vires acts.

  • The power of local government units to impose and collect taxes is based on their fiscal autonomy, as provided by the Constitution.

  • Fiscal autonomy includes the power to create sources of revenue, levy taxes, fees, and charges, and allocate resources according to their priorities.

  • Quarry fees and taxes are collected by the city or municipal treasurer, as mandated by the Philippine Mining Act and its Implementing Rules and Regulations.

  • Executive Order No. 224 does not authorize the task force to impose its own rules or regulations over local government units but acts as a supervisory mechanism.

  • The President's power of general supervision means the power to ensure that subordinates perform their functions according to the law.

  • The President's power of control is the power to alter, modify, or set aside what a subordinate officer has done in the performance of his duties, and to substitute the judgment of the President over that of the subordinate officer.

  • The power of control allows the President to revise or reverse acts or decisions of a subordinate officer involving the exercise of discretion.

  • The power of general supervision over local government units does not infringe on their fiscal autonomy.

  • Administrative issuances must be reasonable and should not go beyond the bounds of the law they are meant to implement.

  • Executive acts enjoy the presumption of constitutionality. If they can be construed in a way that is not in conflict with what is ordained in the Constitution, that construction is preferred.

  • The nullification of a legislative or executive act requires a clear violation of the Constitution.