Land Titling in Cebu Province

Report
Improving Property Rights
Land Titles and Tax Records Meet in Cebu
Ateneo Center for Economic Research and Development
with support from
United States Agency for International Development
and
The Asia Foundation
June 2008
Presentation Outline
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Project Team
Land administration in the Philippines
Possible Models
Project Objective, Description and Status
Moving Forward
Project Team
• Ateneo Center for Economic Research and Development
• Gamaliel Pascual, investment banker; RoSS
conceptualization and execution
• Victor Limlingan, professor and stock broker
• Atty. Erwin Tiamson, former LMB and LAMP Director
• Engr. Bienvenido Cruz, Head of Surveys - LMB
• DBP Data Center Inc.
– Bank – GOCC -- IT contractor
Property Rights and
Economic Development
• Property rights as an “institutional driver or
hindrance” of a country’s economic development
• Land represents the major asset holding and
marker of wealth in the Philippines
• Major commercial transactions are premised on or
rely on titled property
• Uncertainty over property ownership of & finality of
legal decisions creates significant costs to the
ability to do business or attract investments
• Robustness of land rights is directly correlated to
economic development and per capita income
ATENEO CENTER FOR ECONOMIC RESEARCH AND DEVELOPMENT
Land Administration 1
• Two Historical Accounting Methods
– Spanish Era
• All land can be privatized unless reserved by the
State
• The Deeds System (Who Owns What)
– American Era
• Regalian doctrine - All land is owned by the State
unless otherwise disposed of
• Torrens System (What is Owned by Whom?)
• American administration confirmed Spanish deeds
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Actors in the Titling Process
DENR
Cadastral Map
Approval of surveys
LRA /
Register
of Deeds
Subdivision of titles
Licensed
Geodetic
Engineer
Land Administration 2
• Distributed workflows between DENR and LRA
with weak control points
• The map and the title do not have to match nor
coordinate
– Map maker: DENR Land Management Bureau
• Classification of parcel
• Disposition
– Title Registry: Land Registration Authority and
Register of Deeds
• Origination and Transfers
• The technical description does not locate the property
graphically
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Land Administration 3
• All have text-based records
• No graphical representation or reference
• No one knows
– if there are overlapping titles
– if the property is in the middle of the ocean or
part of EDSA or overlaps with another
Land Administration 4
• Systemic Introduction of Errors
– Three Survey Standards
• Government Limitations
– Salary Standardization
– Lack of Budget
– Inability to Absorb IT into Business Processes
– Continuous degradation of record keeping
and controls
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The Goal
• Improve title search and verification and bankability
• Key: Link the map and the title
• Other Solutions
– Land Administration Reform Act: institutionalist approach
• Integrate LRA, RoD and LMB
– LARES: database approach
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BOT to establish database of all titles
Who owns data? Who goes to jail?
Why JPEG?
Still no link to a map
Data is held hostage, a permanent franchise
ATENEO CENTER FOR ECONOMIC RESEARCH AND DEVELOPMENT
Ateneo Project
• “Virtual approach”
– Connect the digital PDF title with a “tax map”
• Strategy
– Policy analysis and recommendations
Establish a working prototype
– Prepare a financially sustainable national rollout strategy
Model 1: Government Securities
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BES
Book entry (name certificates)
Persistence of multiple/fake
certificates
Warehouse receipts
300 persons to manage and
perform reconciliation
Metro Manila marketplace
30 day recertification process
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RoSS
Name on registry
100% scripless
5 persons to manage the
operations
Nationwide participation
Real-time registration
More than one trillion pesos
in dematerialized form
Financial assets in paper form totally transformed into electronic form and
accepted by banks, insurance companies, and retail
ATENEO CENTER FOR ECONOMIC RESEARCH AND DEVELOPMENT
Model 2: ATM Networks
• Paper and electronic records happily exist
• Paper currency has not been eliminated
but people are just as happy to view ATM
bank balance as definitive proof of one’s
savings or wealth
• Everyone is secure in the knowledge that
money is not being duplicated just
because ATMs were introduced
ATENEO CENTER FOR ECONOMIC RESEARCH AND DEVELOPMENT
Project Partners
• Tripartite MoA
– Ateneo
– Registry of Deeds of City of Cebu (national)
– Government of the City of Cebu (local)
• Use a common base map for metro Cebu
parcels and titles
Cebu City LGU
• “Early adopter” of GIS
• Main effort to use GIS
initiated in 1992 under
USAID project for
Urban Shelter
Program
• Real Property Tax
Information System
and Business Permits
Cebu City GIS
• The value of graphical representation
– Out of 76,000 parcels enrolled
• 25,000 parcels had no tax declaration
• 22,000 had duplicate tax declarations
• 18,000 tax declarations could not be connected to a parcel
– Discrepancies were to be resolved by the city assessor
– City assessor was taken to court
• Digital Map
– Approximations; more than good enough for fiscal purposes
• Impact
– Increased revenue generation by almost 300% in the first year
– Sued own City Assessor for changes to Tax Declarations as
detected through the RPTIS
– One of the first Galing Pook Awardees
Cebu City GIS
• Orthographic map
– Initiated for actual land use mapping
– Then for projects and requests monitoring
• Now over 200 layers
• Other applications:
– Monitoring of Dengue Cases
– eBlotter
– Inventory of business establishments
– Maintenance of Parcel files
Cebu City Register of Deeds
• Paper-based and typewriter
• Limited budget; mostly personnel
• Systematic Degradation of Checks and
Balances
• Salary Standardization
• Manual handling of 200k + titles
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Tax Map + Title + Tax Payment =
Increased Certainty
CITY OF CEBU
CITY OF CEBU
REGISTER OF DEEDS
Real Estate Tax
Payments
Database
Scanned Images
Database
Search Index:
Owner / Lot No.
/ Parcel No
Banks and other subscribers:
Online Search & Retrieval
Philippine E-commerce Fundamentals
• Enabling Law (RA 8279)
• Implementing Rules and Regulations
• Supreme Court Rules on Electronic Evidence
Drafting RA 8279
SC Rules of Evidence
RA 8279 Signing
ATENEO CENTER FOR ECONOMIC RESEARCH AND DEVELOPMENT
Project Activities
• Scan entire Register of
Deeds vault
• Developed methodology to
match title to Cebu “tax
map” parcels
• Developed search and
query application
Outcome: RoD to certifying the contents of the database
Compliant with Ecommerce Law and SC Rules of Electronic Evidence
OTC certified true copies of titles = downloaded authenticated
scanned copies
A NEW VERIFICATION
MODEL
Challenges and Opportunities
• Government Has No Budget
• Must Be Auditable by the BSP if Banks
Will Rely on the Information
• Establishment of a Clearinghouse Entity
• Users can trace trail of “tax payments” and
titles backwards
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Spatial Information Delivers
Reduces Risk
ATENEO CENTER FOR ECONOMIC RESEARCH AND DEVELOPMENT
Next Steps
• Develop Text and Spatial Search Engine
• Regulatory Support
– Presentation to BSP and IC
• Structure a Portal Business Structure
(Global Development Alliance) for national
roll-out
– Banks and Insurance Cos.
– Ateneo
– USAID and TAF
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Portal Business Structure
• Real Property Information Portal
– Sustained by subscription fees
– Ownership not settled
• Banks
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Lower risks
Faster verification
Multiple tax payments may be disputed properly
Able to trace title and tax payment history
• BSP and IC
– New verification system gives better quality collateral
– Policy Analysis: Determine if new risk assessment
model is warranted for certified online verification
Portal Business Structure 2
• Local Governments
– Higher revenue and notification of division of
property
• Register of Deeds
– RoD has no budget nor 24/7 capability
– Fees support IT Maintenance
– Fees support continuing HR training
Spatial Information Is A New
Verification Asset
Textual Info
on Tax
Payments
Hopefully they coincide
Textual Info
on Titles
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Spatial Information Is A New Verification
Asset (Overlapping Titles)
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Spatial Information Is A New Verification
Asset (Multiple Tax Payments)
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Potential Impact
• Model for inter-agency collaboration
• Reduction in “Doing Business Indicators”
for property rights
– GIS revamps permitting process (ie. Business
location, zoning, environmental clearance,
land use, etc.)
• Model for introducing IT into government
business processes on a sustainable and
expansionist basis
Issues Moving Forward
• Current portal only provides information
• A “Reconciliation Roadmap”
– Only when we can reconcile discrepancies
and inaccuracies can we claim that property
rights have been secured…
• Beyond Property Rights
– Tax Payments will follow when businesses
shift their preference to online verification
Thank you

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