ADB grants property valuation loan

MANILA, Philippines — The Asian Development Bank (ADB) has provided the Philippines $26.5 million or approximately P1.4 billion in loans to fund a project which seeks to improve the property valuation capacity of local government units, according to the Department of Finance (DOF).

In a statement, the DOF said Finance Secretary Carlos Dominguez, in behalf of the Philippine government, and ADB country director for the Philippines Kelly Bird, signed the $26.5 million loan agreement for the Local Governance Reform Project (LGRP) on July 1.

Dominguez said the project aims to improve the capability of LGUs in assessing and appraising property values to enable them to raise more revenues from real property taxes.

“This financial assistance from the ADB for the LGRP will help LGUs close the digital divide in their respective localities as they pursue property valuation and tax reforms to generate more revenues, in step with President Duterte’s goal to modernize Philippine taxation and spell greater fiscal autonomy for our local governments,” he said.

Among the goals of the project is the development of a property valuation database and information system, according to the DOF.

The LGRP is also expected to improve the capacity of the Bureau of Local Government Finance (BLGF), an attached agency of the DOF, in exercising administrative supervision and oversight functions over the treasury and assessment operations of LGUs.

In addition, the DOF said the project aims to professionalize the ranks of licensed property appraisers and assessors, and align local property valuation benchmarks with international standards.

The ADB’s loan covers around 89 percent of LGRP’s total project cost amounting to $29.8 million (around P1.56 billion). The remaining amount will be shouldered by the government.

The DOF said the agreement is expected to be effective this month, with the loan payable in 28 years, inclusive of a  nine-year grace period.

Earlier, the Manila-based multilateral lender said it has laid down a pipeline of 11 projects worth $4.2 billion for this year which include projects crucial to pandemic response.

ADB said this will be a record lending for the Philippines, coming from $2.5 billion total lending last year, and precedes an indicative lending program of $4.1 billion for next year.

Aside from the $26.5 million loan for the LGRP, five other projects have already been approved for financing under the 2020 pipeline so far.

These include the $1.5 billion loan for the COVID-10 Active Response and Expenditure Support Program; $200 million additional financing for the Social Protection Support Project; $400 million for the Support to Capital Market Generated Infrastructure Financing, Subprogram 1; $500 million additional financing for the Expanded Social Assistance Project; and the $126 loan for the million Angat Water Transmission Improvement Project.