Be it enacted by the Senate and House of Representatives of the Philippines in Congress assembled:

SECTION 1. Conversion.  — The Panay State Polytechnic College in the Province of Capiz is hereby converted into a state university to be known as the Capiz State University (CAPSU) hereinafter referred to as the University. The center for administration of the University shall be in the Roxas City campus while the center for academic affairs shall be in the Mambusao Poblacion Campus.

SEC. 2. General Mandate. — The University shall primarily provide advanced instruction and professional training in agriculture, fishery and forestry, science and technology, arts and humanities, education and other related fields.   It shall also undertake research, extension services and production activities, and provide progressive leadership in its areas of specialization.

SEC. 3. Curricular Offerings. — The University shall offer undergraduate, graduate and short-term courses within its areas of specialization and according to its capabilities, as the Board of Regents may deem necessary to carry out its objectives, particularly in order to meet the needs of the Province of Capiz and the region.

The existing high school/s shall be transferred to the jurisdiction and supervision of the Department of Education (DepEd): Provided, That the high school/s shall be allowed to remain and operate within the campus of the University until the existing students shall have completed their high school education: Provided, further, That the University may operate a reasonably-sized laboratory school, if it has a College Education.

SEC. 4. Administration. — The University shall have the general powers of a corporation set forth in Batas Pambansa Blg. 68, as amended, otherwise known as the "Corporation Code of the Philippines." The administration of the University and the exercise of its corporate powers shall be vested exclusively in the Board of Regents and the president of the University insofar as authorized by the Board.

SEC. 5. The Governing Board. — The Governing Board of the state university shall be the Board of Regents, hereinafter referred to as the Board, which shall be composed of the following:

1. The Chairperson of the Commission on Higher Education (CHED), as chairperson;
   
2. President of the University, as vice chairperson;
   
3. Chairperson of the Committee on Education, Arts and Culture of the Senate, as member;
   
4. Chairperson of the Committee on Higher and Technical Education, House of Representatives, as member;
   
5. Regional Director of the National Economic and Development Authority (NEDA), as member;
   
6. Regional Director of the Department of Agriculture (DA), as member;
   
7. President of the federation of the faculty associations of the University, as member;
   
8. President of the federation of the student councils of the University, as member;
   
9. President of the federation of the alumni associations of the University, as member; and
   
10. Two (2) prominent citizens who have distinguished themselves in their professions or fields of specialization of the University, as members.
    

The Board of Regents shall appoint two (2) prominent citizens from among a list of at least five (5) persons qualified in the Province of Capiz, as recommended by the search committee constituted by the University president, in consultation with the Chairperson of the CHED, based on the normal standards and qualifications for the position set by the Board.

The term of office of the president of the federation of faculty associations, the president of the federation of student councils, and the president of the federation of alumni associations shall be coterminous with their respective terms of office, as set forth in their respective Constitutions and By-Laws.

The two (2) prominent citizens shall serve for a term of two (2) years, from appointment date.

SEC. 6. Promulgation and Implementation of Policies. — The Board shall promulgate and implement policies in accordance with the declared State policies on education and other pertinent provisions of the Constitution on education, agriculture, science and technology, as well as the policies, standards and thrusts of the CHED under Republic Act No. 7722, otherwise known as the "Higher Education Act of 1994."

SEC. 7. Powers and Duties of the Board of Regents. — The Board shall have the following specific powers and duties in addition to its general powers of administration and the exercise of all powers granted to the board of directors of a corporation under existing laws:

1. To promulgate rules and regulations as may be necessary to carry out the purposes and functions of the University;
   
2. To receive and appropriate all sums as may be provided, for the support of the University in the manner it may determine, in its discretion, to carry out the purposes and functions of the University;
   
3. To import duty-free economic, technical and cultural books and/or publications, upon certification by the CHED that such imported books and/or publications are for economic, technical, vocational, scientific, philosophical, historical or cultural purposes, in accordance with the provisions of the Tariff and Customs Code, as amended;
   
4. To receive in trust, legacies, gifts and donations of real and personal properties of all kinds and to administer and dispose of the same when necessary for the benefit of the University, and subject to the limitations, directions and instructions of the donor, if any.
   
   Such donations shall be exempt from the donor's tax and the same shall be considered as allowable deductions from the gross income in the computation of the income tax of the donor, in accordance with the provisions of the National Internal Revenue Code (NIRC), as amended: Provided, That such donations shall not be disposed of, transferred or sold;
   
   
5. To fix the tuition fees and other necessary school charges such as, but not limited to, matriculation fees, graduation fees and laboratory fees, as the Board may deem proper to impose, after due consultations with involved sectors;
   
   Such fees and charges, including government subsidies and other income generated by the University, shall constitute special trust funds and shall be deposited in any authorized government depository bank, and all interest that shall accrue therefrom shall form part of the same funds for the use of the University;
   
   Any provision of existing laws, rules and regulations to the contrary notwithstanding, any income generated by the University from tuition fees and other charges, as well as from the operation of auxiliary services and other grants, shall be retained by the University, and may be disbursed by the Board for instruction, research, extension or other programs/projects of the University: Provided, That all fiduciary fees shall be disbursed for the specific purpose for which they are collected;
   
   If, for any reason beyond its control, the University shall not be able to pursue any project for which funds have been appropriated and allocated under its approved program of expenditures, the Board may authorize the use of the said funds for any reasonable purpose which, in its discretion, may be necessary and urgent for the attainment of the objectives and goals of the University;
   
   
6. To adopt and implement a socialized scheme of tuition and school fees for greater access to poor but deserving students;
   
7. To authorize the construction or repair of its buildings, machinery, equipment and other facilities, and the purchase and acquisition of real property, including necessary supplies, materials and equipment;
   
8. To appoint, upon recommendation of the president of the University, vice presidents, deans, chancellors, directors, heads of campuses, faculty members and other officials and employees of the University;
   
9. To fix and adjust salaries of faculty members, administrative officials and employees subject to the provisions of the Revised Compensation and Position Classification System and other pertinent budget and compensation laws governing hours of service, and such other duties and conditions as it may deem proper; to grant them, at its discretion, leaves of absence under such regulations as it may promulgate, any provision of existing laws to the contrary notwithstanding; and to remove them for cause in accordance with the requirements of due process of law;
   
10. To approve the curricula, institutional programs and rules of discipline drawn by the administrative and academic councils as herein provided;
    
11. To set policies on admission and graduation of students;
    
12. To award honorary degrees upon persons in recognition of outstanding contribution in the field of agriculture or any field of specialization within the academic competence of the University; and to authorize the awarding of certificates of completion of non-degree and nontraditional courses;
    
13. To establish and absorb nonchartered tertiary institutions within the Province of Capiz as branches and centers, in coordination with the CHED, and in consultation with the Department of Budget and Management (DBM), and to offer therein programs or courses, to promote and carry out equal access to educational opportunities as mandated by the Constitution;
    
14. To establish research and extension centers of the University where such will promote the development of the latter;
    
15. To establish chairs in the University and to provide fellowships for qualified faculty members and scholarships to deserving students;
    
16. To delegate any of its powers and duties provided for hereinabove to the president and/or other officials of the University as it may deem appropriate, so as to expedite the administration of the University;
    
17. To authorize an external management audit of the institution, to be financed by the CHED, subject to Commission on Audit (COA) rules and regulations, and to institute reforms, including academic and structural changes, on the basis of the audit results and recommendations;
    
18. To collaborate with the governing boards of state universities and colleges within the Province of Capiz or the region, under the supervision of the CHED and in consultation with the DBM, and work towards the restructuring of the University to become more efficient, relevant, productive and competitive;
    
19. To enter into joint ventures with business and industry for the profitable development and management of the economic assets of the University, the proceeds of which shall be used for the development and strengthening of the University;
    
20. To develop consortia and other forms of linkages with local government units, institutions and agencies, both public and private, local and foreign, in furtherance of the purposes and objectives of the University;
    
21. To develop academic arrangements for institution capability building with appropriate institutions and agencies, both public and private, local and foreign, and to appoint experts/ specialists as consultants, part time or visiting or exchange professors, scholars, researchers, as the case maybe;
    
22. To set up the adoption of modern and innovative modes of transmitting knowledge such as the use of information technology, the dual system, open learning or distance education, community laboratory, for the promotion of greater access to higher education;
    
23. To establish policy guidelines and procedures for participative decision-making and transparency within the University;
    
24. To privatize, where most advantageous to the University, management of nonacademic services such as health, food, building, grounds or property maintenance and similar activities; and
    
25. To extend the term of the president of the University beyond the age of retirement but not later than the age of seventy (70), whose performance has been unanimously rated by the Governing Board as outstanding, after unanimous recommendation by the search committee.
    

SEC. 8. Meetings of the Board. — The Board shall regularly convene at least once every quarter. However, the Chairperson of the Board may, upon three (3) days' prior written notice, call a maximum of two (2) special meetings whenever necessary.

A quorum of the Board shall consist of a majority of all its members holding office at the time of the meeting: Provided, however, That the Chairperson of the CHED or the president of the University is among those present in the meeting.

In the absence of the Chairperson of the CHED, a Commissioner of the CHED duly designated by him/her, shall represent him/her in the meeting with all the rights and responsibilities of a regular member: Provided, however, That in the said meeting, the president of the University as vice chairperson shall be the presiding officer: Provided, further, That this proviso notwithstanding, the Chairperson of the CHED is hereby authorized to designate a CHED Commissioner as the regular Chair of the Board of Regents, in which case said CHED Commissioner shall act as the presiding officer.

In case the Chairpersons of the Congressional Committees on Education shall not be able to attend the Board meeting, they may duly designate their respective representatives to attend said meeting, who shall have the same rights and responsibilities as a regular member of the Board.

The members of the Board shall not receive any salary but shall be entitled to reimbursements for actual and necessary expenses incurred, either in their attendance to meetings of the Board, subject to existing laws and regulations.

SEC. 9. The University President. — The University shall be headed by a president who shall render full time service. He/She shall be appointed by the Board, upon recommendation of a duly constituted search committee. He/She shall hold office for a term of four (4) years and shall be eligible for reappointment for another term: Provided, That in order to effect a smooth transition to a state university, the president of the Panay State Polytechnic College (PSPC), if qualified, shall serve as the first president of the University.

The president shall be assisted by a vice president for academic affairs and a vice president for administration, who shall be appointed by the Board upon the recommendation of the president.

In case of vacancy in the office of the president by reason of death, compulsory retirement, resignation, removal for cause or incapacity of the president to perform the functions of his/her office, the Board shall have the authority to designate an officer-in-charge of the University, pending the appointment of a new president.

In case of vacancy in the office of the president as mentioned in the immediately preceding paragraph, his/her successor or the officer-in-charge of the University shall hold office for the unexpired term only.

The powers and duties of the president of the University, in addition to those specifically provided in this Act, shall be those usually pertaining to the office of the president of similar universities, and those delegated by the Board.

The salary of the president of the University shall be in accordance with the Revised Compensation and Position Classification System and shall be comparable to that being received by the presidents of similar educational institutions.

SEC. 10. The Administrative Council. — There shall be an Administrative Council consisting of the president of the University as chairperson, the vice president(s), deans, directors and other officials of equal rank as members, whose duty is to review and recommend to the Board the policies governing the administration, management and development planning of the University for appropriate action.

SEC. 11. The Academic Council. — There shall be an Academic Council with the president of the University as chairperson and all members of the academic staff, with the rank of not lower than assistant professor, as members.

The Academic Council shall have the power to review and recommend curricular offerings and rules of discipline of the University, subject to the approval of the Board. It shall fix the requirements for the admission of students, as well as for their graduation and conferment of degrees, subject to review and/or approval of the Board of Regents through the president of the University. It shall have disciplinary power over the students of the University and shall formulate academic policies, rules and regulations on discipline, subject to the approval of the Board of Regents.

SEC. 12. The Secretary of the University. — The Board shall appoint a secretary, who shall serve as such for both the Board and the University and shall keep all records and proceedings of the Board. He/She shall communicate to each member of the Board the notices of meetings.

SEC. 13. The Treasurer of the University. — The Treasurer of the Philippines shall be the ex officio treasurer of the University.

SEC. 14. Faculty. — No political beliefs, gender preference, cultural or community affiliation or ethnic origin, religious opinion or affiliation shall be a matter of inquiry in the appointment of faculty members in the University: Provided, however, That no member of the faculty shall teach for or against any particular church or religious sect.

SEC. 15. Scholarship Program/Admission. — The University shall provide a scholarship program and other affirmative action programs to assist poor but deserving students who qualify for admission to the University.

No student shall be denied admission to the University by reason of sex, religion, cultural or community affiliation or ethnic origin.

SEC. 16. Academic Freedom and Institutional Autonomy. — The University shall enjoy academic freedom and institutional autonomy, pursuant to paragraph 2, Section 5 of Article XIV of the Constitution of the Republic of the Philippines.

SEC. 17. Authority to Loan or Transfer. — The heads of bureaus and offices of the national government are hereby authorized to loan or transfer, upon request of the president of the University, such apparatus, equipment or supplies as may be needed by the University, and to detail employees, for duty therein when, in the judgment of the bureau or office, such apparatus, equipment, supplies or services of such employees can be spared without serious detriment to public service. Employees so detailed shall perform such duties as required of them by the president of the University, and the time so employed shall be counted as part of their regular services.

SEC. 18. Assets, Liabilities and Personnel. — All assets, real and personal, personnel and records of the Panay State Polytechnic College, as well as liabilities or obligations, are hereby transferred to the University. The positions, rights and security of tenure of the personnel therein employed under existing laws shall be respected.

All parcels of land belonging to the government and occupied by the Panay State Polytechnic College are hereby declared to be the property of the University and shall be titled under that name: Provided, That should the University cease to exist or be abolished or such parcels of land aforementioned be no longer needed by the University, the same shall revert to the Province of Capiz.

SEC. 19. Appropriations. — The amount necessary to carry out the provisions of this Act shall be charged against the current year's appropriations of the Panay State Polytechnic College, except the sums needed to continue the operations of the existing high schools. Thereafter, such sums as may be necessary for the continued operation and maintenance of the Capiz State University (CAPSU) shall be included in the annual General Appropriations Act.

SEC. 20. Development Plan, Management Audit, ganizational/Administrative/Academic Structure. — Within the period of one hundred and twenty (120) days after the approval of this Act, the University shall accomplish the following:

1. Submit a five-(5) year development plan, including its corresponding program budget, to the CHED, for appropriate recommendation to the DBM;
   
2. Undergo a management audit in cooperation with the CHED; and
   
3. Accordingly set-up its organizational, administrative as well as academic structure, including the appointment/designation of key University officials.
   

SEC. 21. Filing of Report. — On or before the fifteenth (15th) day of the second month after the opening of the regular classes each year, the Board shall file with the Office of the President of the Philippines through the Chairperson of the CHED, and with both Houses of Congress, a detailed report on the progress, conditions and needs of the University.

SEC. 22. Suppletory  Application. — The provisions of Republic Act No. 8292, otherwise known as the "Higher Education Modernization Act of 1997", shall be an integral part of this Act and together shall serve as part of the Governing Charter of the University.

SEC. 23. Repealing Clause. — All laws, presidential decrees, executive orders, rules and regulations contrary to or inconsistent with the provisions of this Act are hereby repealed, amended or modified accordingly.

SEC. 24. Effectivity. — This Act shall take effect upon its approval.

Approved,

(Sgd.) FRANKLIN M. DRILON	(Sgd.) JOSE DE VENECIA
President of the Senate	Speaker of the House of Representatives

This Act which originated in the House of Representatives was finally passed by the House of Representatives and the Senate on February 7, 2004 and February 6, 2004, respectively.

(Sgd.) OSCAR G. YABES	(Sgd.) ROBERTO P. NAZARENO
Secretary of the Senate	Secretary General House of Representatives

Approved: MAR 21 2004