TACLOBAN CITY – The provincial government of Leyte will use its geothermal royalty tax share to enhance its school building program, as the state-owned Philippine National Oil Co. is set to pay the concerned local government units (LGUs) their royalty tax share amounting to P450 million.

Gov. Carlos Jericho Petilla said that for several years already, the host LGUs have been urging the geothermal company to pay royalty taxes to the province, the host municipality, and the host barangays, and the issue has even reached the courts.

Section 294 of Republic Act 7160 or the Local Government Code of 1991 provides that 45 percent of royalties from utilization of natural resources should go to the host towns, 35 percent to host barangays, and 35 percent to the host province.

Should the payment materialize during the later part of this year, the province would utilize its share for its school building program to address the lack classrooms in many public elementary and high schools.

President Gloria Macapagal-Arroyo also announced during the opening of the Palarong Pambansa 2009 here that the royalty shares for host LGUs of geothermal energy projects have already been determined and would soon be released.
 
The Department of Budget and Management has already computed the royalty tax shares.   President Arroyo has ordered the DBM together with the Department of Energy, Department of Finance and the Department of Interior and Local Government to work on the computation and have them released in the soonest possible time.

The province of Leyte expects to receive P4 million for year 2007 and P17.6 million for 2008, while the Municipality of Kananga will receive P6.280 million and P26.17 million, and Ormoc City to receive  P2.9 million and P13.462 million for the same respective years.