San Fernando has proven that instituting a systemic reform in fiscal management need not be complicated. For it to work, simple and ordinary measures must be integrated into the day-to-day operations of the local government to ensure a steady increase in revenues and better disbursement of funds.
Seven years ago, the municipality plunged into a huge financial mess. Lahar buried six of its towns covering 34 barangays in the town’s main commercial district. Consequently, investment opportunities took a nosedive. Monetary obligations with the public and private sectors translated to millions of pesos together with a P12 M overdraft. Unless a responsive revenue administration was instituted, the whole municipality faced a bleak future.
To spin off the process, an “Operation Suyod” (tax mapping) was made in each barangay. A masterlist of all business establishments was undertaken making the Treasurer’s Office a one-stop shop for all taxes, fees and licenses. Taxpayers were guided by simplified brochures and leaflets that contain a checklist of all required documents and steps to be followed. Another innovative feature of the program was the issuance of business plates to be displayed publicly to identify paid business permits. A Tax Enforcement Unit was likewise authorized to check on delinquent firms. If the concerned party failed to fulfill its financial obligation 10 days upon receipt of notice from the Treasurer’s Office, the PNP Investigator promptly filed a criminal complaint in the Municipal Trial Court. From 1995 to 2000, 233 cases (usually delinquent stallholders) were prosecuted and they paid corresponding monetary penalties.
Tax money was spent on highly visible projects such as roads, bridges, health centers and dumpsites. They all carried the slogan “Buwis Mong Binayaran, Proyektong Pakikinabangan.” A financial report summarizing income and expenditures was posted in public places. At the same time, the municipal government gave a plaque of recognition in an annual ceremony to the “First 50 Biggest Business Taxpayers.” Every revenue-generating office such as the Treasurer’s Office, Assessor’s Office, Engineer’s Office, slaughterhouse and public market prepared annual action plans where quarterly targets were set and strategies were specified to attain goals. All key offices of the LGU together with the major NGOs in the community also took part in the bidding and planning process.
As a result of these initiatives, the budgetary deficit of P 7.41 million in 1992 turned into a big surplus reaching a figure of P 27.1 million in 1999. Business establishments grew by 83% in 2000 (4.462) from a low 17% (2.872) in 1994. Local revenues continue to grow at an average of 16% per annum without any increase in tax rates because of regular updates of the masterlist of businesses.
This program is recognized as one of the Ten Outstanding Programs in the 2000 Galing Pook Awards.