LAW ON LOCAL GOVERNMENTS > A. Public Corporations > 3. Classifications > b. Municipal Corporations > iii. Requisites for Creation, Conversion, Division, Merger or Dissolution

In Philippine law, the creation, conversion, division, merger, or dissolution of municipal corporations, such as provinces, cities, municipalities, and barangays, is governed primarily by the 1987 Constitution, the Local Government Code of 1991 (Republic Act No. 7160), and pertinent laws and jurisprudence. Below are the key requirements and legal considerations:

1. Creation of Local Government Units (LGUs)

The creation of a municipal corporation, such as a province, city, municipality, or barangay, requires the fulfillment of several substantive and procedural requisites.

a. Substantive Requisites

Income Requirement:
- The creation of provinces, cities, and municipalities is contingent on the generation of a minimum annual income derived from local sources, as certified by the Department of Finance. This ensures the financial viability of the new LGU. The minimum income requirements are as follows:
  - Provinces: PHP 20 million
  - Cities: PHP 100 million
  - Municipalities: PHP 2.5 million
  - Barangays: No specific income requirement; however, it must be capable of supporting itself.
Population Requirement:
- A minimum population threshold must be met as certified by the Philippine Statistics Authority (PSA). These thresholds are:
  - Provinces: Not less than 250,000 inhabitants
  - Cities: Not less than 150,000 inhabitants
  - Municipalities: Not less than 25,000 inhabitants
  - Barangays: Not less than 2,000 inhabitants (or 5,000 in Metro Manila and other highly urbanized cities)
Land Area Requirement:
- The new LGU must have a minimum land area, unless it is composed of islands or is a metropolitan area. These are:
  - Provinces: At least 2,000 square kilometers
  - Cities: At least 100 square kilometers
  - Municipalities: At least 50 square kilometers
  - Barangays: No specific land area requirement.
Compliance with General Welfare:
- The creation must be in accordance with the principles of general welfare. It must promote a more efficient and effective delivery of services and public administration.

b. Procedural Requisites

Petition or Initiative:
- The creation of a new LGU can be initiated by an act of Congress or a local initiative by a majority of the local legislative body concerned, subject to the approval of the President, and must follow the necessary administrative processes.
Plebiscite Requirement:
- No creation of a new province, city, municipality, or barangay shall take effect unless approved by a majority of the votes cast in a plebiscite. The plebiscite must be conducted by the Commission on Elections (COMELEC) within 120 days from the effectivity of the law or ordinance creating the new LGU. The plebiscite must be held in the affected area(s), which include not only the proposed new LGU but also the areas affected by the separation.

2. Conversion of Local Government Units

Conversion pertains to changing the status or classification of an LGU (e.g., from a municipality to a city).

a. Substantive Requisites

Compliance with Income, Population, and Land Area Requirements:
- The LGU seeking conversion must meet the income, population, and land area requirements applicable to the higher category of LGU it seeks to become. For instance, for a municipality to be converted into a city, it must meet the income, population, and land area requirements for cities.

b. Procedural Requisites

Plebiscite:
- Similar to the creation of new LGUs, no conversion shall take effect unless approved by a majority vote in a plebiscite conducted by the COMELEC within the political unit or units affected.
Congressional Action:
- The conversion of an LGU requires an act of Congress (a law) for its conversion to be valid and effective.

3. Division of Local Government Units

An LGU can be divided into two or more LGUs, subject to specific legal requisites.

a. Substantive Requisites

Compliance with Income, Population, and Land Area Requirements:
- Each of the resulting LGUs from the division must independently meet the income, population, and land area requirements under the Local Government Code.
General Welfare:
- The division must serve the general welfare and promote the more efficient delivery of services.

b. Procedural Requisites

Plebiscite:
- The division of an LGU must be approved by a majority of the votes cast in a plebiscite conducted in the political units affected.
Legislative or Executive Initiative:
- The division can be initiated through a law passed by Congress or through a local legislative ordinance, subject to the approval of the President.

4. Merger of Local Government Units

LGUs can be merged into a single unit.

a. Substantive Requisites

Income, Population, and Land Area Requirements:
- The merged LGU must meet the income, population, and land area requirements applicable to the merged entity’s classification.
General Welfare:
- The merger must promote efficiency and effectiveness in governance and public service delivery.

b. Procedural Requisites

Plebiscite:
- The merger must be ratified through a plebiscite conducted by the COMELEC within the affected political units.
Legislative or Executive Initiative:
- A merger can be accomplished through an act of Congress or a local ordinance ratified by a plebiscite, subject to presidential approval.

5. Dissolution of Local Government Units

Dissolution occurs when an LGU ceases to exist due to annexation, incorporation into another LGU, or its inability to sustain itself.

a. Substantive Requisites

General Welfare and Public Interest:
- The dissolution must be in the interest of public welfare and must be justified by reasons such as the LGU's inability to maintain itself financially or provide services effectively.

b. Procedural Requisites

Plebiscite:
- Similar to the creation, division, and merger of LGUs, dissolution must be ratified by a majority vote in a plebiscite held in the LGU to be dissolved and the affected political units.
Act of Congress:
- The dissolution of an LGU requires an act of Congress or a local ordinance subject to the approval of the President.

6. Jurisdictional Challenges and Limitations

a. Constitutional Limitations:

The 1987 Constitution provides for certain restrictions, such as limiting the powers of local legislative bodies and Congress to reorganize political subdivisions without proper observance of the people’s right to vote on changes.

b. Judicial Review:

Any legal dispute regarding the creation, conversion, division, merger, or dissolution of LGUs is subject to judicial review. Courts may nullify actions that fail to comply with constitutional or statutory requirements, particularly in cases where the plebiscite is not conducted or the substantive requirements (income, population, land area) are not met.

7. Relevant Jurisprudence

Several Supreme Court rulings interpret and clarify the application of these provisions:

Comelec v. Nemenzo (G.R. No. 127325, September 25, 2000): This case emphasized the necessity of plebiscites in the creation of barangays.
Pimentel v. Aguirre (G.R. No. 132988, July 19, 2000): This case dealt with the power of the President in altering or creating LGUs and underscored the role of Congress in legislative processes involving LGUs.

Conclusion

The creation, conversion, division, merger, or dissolution of local government units in the Philippines is a process that must follow strict legal and procedural guidelines laid out in the Local Government Code and the 1987 Constitution. The essential principles of financial viability, population, territorial integrity, and public welfare govern these processes. Furthermore, the participation of the affected constituents through a plebiscite ensures that changes to municipal corporations reflect the will of the people.