1.0 This Circular Letter is being issued to guide the agencies and provide clarification on the intent and provisions, particularly of Sections 13 and 14 of R.A. No. 8747 dated June 1, 1999 entitled, œAn Act Requiring Disclosure of Year 2000 Statements and Readiness of Computer Based Systems and Projects, Providing Funds Therefore and for Other Purposes , to wit:

Section 13. Appropriations - Such sum as maybe necessary to implement the provisions of this Act shall be charged against the Contingent Fund. Provided, however, that funds needed by individual agencies for their Y2K remediation activities and all other Y2K activities shall be primarily sourced from the agencies ™ existing appropriations and savings, and as such, the government agencies may realign funds therefore from any budget expense class of existing agency programs and projects without the need of prior individual authority or approval from the Department of Budget and Management for only Y2K remediation activities and directly related Y2K readiness activities.

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Section 14. Reportorial Requirements - The implementing and concerned agencies shall submit a report on all the realignments or use of saving and other budgetary adjustments made to the House Committee on Appropriations, Senate Committee on Finance, and the Committees on Science and Technology of both Houses of Congress, copy furnished the Department of Budget and Management and the Commission on Audit within thirty (30) days after such adjustments are made.

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2.0 Agencies can augment any expenditure item from savings in existing programs, projects and activities in the CY 1999 GAA for Y2K remediation and readiness activities, without the need of prior authority or approval from the Department of Budget and Management, except for the following:

2.1 Creation of additional positions, payment of honoraria and training expenses and increase in RATA;

2.2 Payment of extraordinary and miscellaneous expenses to officials not entitled to the benefit and/or in excess of the approved rates; and

2.3 Construction of buildings and purchase of motor vehicles.

3.0 The use of savings shall not impair the provision for mandatory expenses and implementation of projects with foreign commitments.

4.0 For monitoring purposes, all obligations incurred out of regular appropriations and releases from Special Purpose Funds and realignment/budgetary adjustments authorized herein shall be reported using the attached format shown as Annexes A* as Provided in Section 14 of RA 8747.

4.1 The report shall serve as basis for DBM to issue the SARO to cover the following realignment/use of savings pursuant to Item 2.0:

4.1.1 Realignment from one allotment class to another.

4.1.2 Realignment of MOOE items in excess of one third (1/3) of the amount to be augmented.

5.0 Agency heads shall be held accountable for any violation of the conditions for realignment/augmentation authorized herein.

6.0 For strict compliance.

Adopted: 04 Oct. 1999

(SGD.) BENJAMIN E. DIOKNO
Secretary