Compensation For Road Right Of Way In Dpwh Projects In Philippines

Compensation for Road Right-of-Way in DPWH Projects in the Philippines

Introduction

In the Philippines, the development of infrastructure, particularly road networks, is crucial for economic growth, connectivity, and public welfare. The Department of Public Works and Highways (DPWH) serves as the primary government agency responsible for planning, constructing, and maintaining national roads, bridges, and related infrastructure. However, one of the most significant hurdles in implementing these projects is the acquisition of right-of-way (ROW), which refers to the land or property needed to build or expand roads. Compensation for affected property owners is a core aspect of this process, governed by constitutional mandates and specific legislation to ensure fairness and efficiency.

The Philippine Constitution under Article III, Section 9, stipulates that private property shall not be taken for public use without just compensation. This principle underpins all ROW acquisitions. For DPWH projects, the process has evolved over time to balance the government's need for timely project implementation with the rights of property owners. This article provides a comprehensive overview of the legal framework, procedures, compensation mechanisms, challenges, and related considerations in the Philippine context.

Legal Framework

The acquisition of ROW for national infrastructure projects, including roads under DPWH, is primarily regulated by Republic Act (RA) No. 10752, also known as "An Act to Facilitate the Acquisition of Right-of-Way Site or Location for National Government Infrastructure Projects," enacted in 2016. This law repealed and replaced the earlier RA No. 8974 (2000), which had similar objectives but was deemed insufficient in addressing delays and inefficiencies.

Key Provisions of RA 10752

• Scope: Applies to all national government infrastructure projects, including DPWH road projects, covering the acquisition of real property such as land, improvements, and structures.
• Modes of Acquisition: The law prioritizes voluntary modes to expedite the process:
  • Negotiated sale (preferred method).
  • Donation.
  • Expropriation (as a last resort).
  • Barter or exchange.
  • Easement agreements.
• Implementing Agencies: For road projects, DPWH acts as the implementing agency (IA), responsible for identifying required ROW, conducting appraisals, and negotiating with owners.
• Integration with Other Laws: RA 10752 harmonizes with related statutes, including:
  • The Civil Code of the Philippines (RA No. 386), particularly on property rights and eminent domain.
  • RA No. 7160 (Local Government Code), for coordination with local government units (LGUs).
  • RA No. 7279 (Urban Development and Housing Act), for relocation of informal settlers.
  • RA No. 11201 (Department of Human Settlements and Urban Development Act), for housing aspects in relocations.

Executive Order (EO) No. 1035 (1985) and Department Orders from DPWH further provide procedural guidelines, while the Supreme Court has issued rulings interpreting "just compensation" in cases like City of Manila v. Chinese Community (1919) and Republic v. Vda. de Castellvi (1979), emphasizing fair market value and consequential damages.

Procedures for ROW Acquisition in DPWH Projects

The process for acquiring ROW in DPWH road projects is structured to minimize delays while ensuring due process. It typically follows these steps:

1. Project Planning and Identification:

   • DPWH conducts feasibility studies and detailed engineering designs to determine the exact ROW requirements.
   • Parcellary surveys are performed to identify affected properties, owners, and claimants.

2. Validation and Appraisal:

   • Property owners are notified, and claims are validated using titles, tax declarations, or other proofs of ownership.
   • Appraisal is conducted by a government financial institution (e.g., Land Bank of the Philippines) or independent appraisers accredited by the Bangko Sentral ng Pilipinas (BSP).
   • Valuation considers multiple factors under RA 10752, including Bureau of Internal Revenue (BIR) zonal values, current market value, and replacement costs.

3. Negotiation:

   • DPWH offers to purchase via negotiated sale, with the initial offer based on the appraised value.
   • Owners have 30 days to accept or counter-offer. If accepted, a Deed of Absolute Sale is executed, and payment is made within 30 days.
   • For donations, owners may waive compensation, often for tax incentives or community benefits.

4. Expropriation if Negotiation Fails:

   • If negotiations fail, DPWH files an expropriation case in the Regional Trial Court (RTC).
   • The court determines just compensation, but under RA 10752, the government can take immediate possession upon depositing 100% of the BIR zonal value plus replacement cost for improvements.
   • Writ of possession is issued promptly to avoid project delays.

5. Payment and Relocation:

   • Full payment must be made before title transfer.
   • For displaced families, especially informal settlers along road alignments, relocation sites with basic services are provided under the National Housing Authority (NHA) or LGUs.

6. Clearing and Possession:

   • Once compensated, owners must vacate the property. DPWH coordinates with law enforcement if needed for demolition.

DPWH Department Order No. 34 (2017) outlines specific timelines, aiming to complete ROW acquisition within 12-18 months for major projects.

Compensation Mechanisms

Compensation is the cornerstone of ROW acquisition, ensuring that owners are not unduly burdened. RA 10752 standardizes the determination of "just compensation" to be fair, prompt, and comprehensive.

Components of Compensation

• Land Value: Based on the higher of:
  • Current market value (from recent sales in the area).
  • BIR zonal valuation.
  • Provincial/City/Municipal assessor's value.
• Improvements and Structures: Replacement cost without depreciation, covering buildings, fences, wells, etc., calculated using current construction costs.
• Crops and Trees: Valued at current market prices, often appraised by the Department of Agriculture (DA).
• Consequential Damages: Compensation for any reduction in value of remaining property (e.g., severance damage if land is bisected).
• Disturbance Compensation: For businesses, equivalent to net income loss for up to 6 months; for residential owners, moving costs.
• Interest: If payment is delayed, 6% per annum from the date of taking.
• Taxes and Fees: The government shoulders capital gains tax, documentary stamp tax, and transfer taxes for negotiated sales, easing the burden on owners.

Special Considerations

• Informal Settlers: Under RA 10752 and RA 7279, qualified informal settler families (ISFs) receive financial assistance or relocation housing instead of full market compensation, as they lack legal title. Amounts range from PHP 15,000 to PHP 450,000 depending on location and program.
• Indigenous Peoples: If ROW affects ancestral domains, compliance with RA No. 8371 (Indigenous Peoples' Rights Act) requires free, prior, and informed consent (FPIC) from the National Commission on Indigenous Peoples (NCIP), with compensation including royalties or equity shares.
• Easements: For partial acquisitions, compensation is prorated, but full ownership may be acquired if the remaining portion is uneconomical.
• Inflation Adjustments: Valuations are updated periodically by BIR and LGUs to reflect economic changes.

In court expropriation, commissioners may be appointed to assess value, and owners can appeal to higher courts if dissatisfied.

Challenges and Issues

Despite legal reforms, ROW acquisition for DPWH projects faces persistent challenges:

• Delays: Overlapping claims, fraudulent titles, and lengthy court proceedings often postpone projects, leading to cost overruns. For instance, major expressways like the North Luzon Expressway (NLEX) extensions have been delayed by years due to ROW issues.
• Valuation Disputes: Owners frequently contest appraisals as undervalued, citing speculative market trends.
• Corruption and Inefficiencies: Allegations of graft in appraisals or favoritism in relocations undermine trust.
• Social Impacts: Displacement affects livelihoods, particularly in urban areas like Metro Manila, where road widening displaces thousands.
• Budget Constraints: DPWH's annual budget allocations for ROW (e.g., under the General Appropriations Act) may be insufficient for large-scale projects.
• Environmental and Cultural Concerns: ROW through protected areas requires Environmental Compliance Certificates (ECC) from the Department of Environment and Natural Resources (DENR), adding layers of approval.

To mitigate these, DPWH has implemented reforms like the ROW Action Plan (ROWAP), partnering with private sectors for advance acquisitions, and using technology for digital mapping.

Judicial Interpretations and Case Law

Philippine jurisprudence reinforces the principles of just compensation:

• Association of Small Landowners in the Philippines v. Secretary of Agrarian Reform (1989): Emphasized that compensation must be in money, not bonds, and at fair market value.
• National Power Corporation v. Spouses Ileto (2006): Ruled that interest accrues from the date of actual taking.
• Secretary of DPWH v. Spouses Tecson (2015): Clarified that zonal values are not conclusive but evidentiary in determining market value.

These cases guide DPWH in avoiding litigation pitfalls.

Conclusion

Compensation for road right-of-way in DPWH projects embodies the Philippine government's commitment to equitable development. RA 10752 has streamlined processes, prioritizing negotiation and fair valuation to reduce conflicts and accelerate infrastructure growth. However, successful implementation requires robust inter-agency coordination, transparent appraisals, and sensitivity to affected communities. Property owners are encouraged to engage legal counsel early, while DPWH continues to refine its approaches through policy updates and stakeholder consultations. Ultimately, a balanced ROW framework not only facilitates road projects but also upholds constitutional rights, contributing to a more connected and prosperous nation.