REVENUE MEMORANDUM CIRCULAR NO. 1-2009 issued on January 16, 2009 publishes the full text of Circular Letter No. 2008-9 issued by the Secretary of the Department of Budget and Management (DBM), entitled “Guidelines Implementing Administrative Order (AO) No. 228 and the P resident’s Directive dated May 31, 2008”.
       Pursuant to the Circular Letter, agencies shall continue to implement the electricity and fuel saving measures provided under existing issuances, Implementing Rules and Regulations of the Government Energy Management Program (GEMP) and A.O. No. 228.
       Agency savings pursuant to General Provision (GP) No. 60 of the 2008 General Appropriations Act (GAA) shall refer to portions or balances of any programmed appropriation in this Act free from any obligatio n or encumbrance, which are:

1. 1. 1. 1. Still available after the completion or final discontinuance or abandonment of the work, activity or purpose for which the appropriation is authorized;
         2. From appropriation balances arising from unpaid compensation and related costs pertaining to vacant positions and leaves of absence without pay; and
         3. From appropriations balances realized from the implementation of collective negotiation agreements which resulted in improved systems and efficiencies and thus enabled an agency to meet and deliver the required or planned targets, programs and services approved in the said Act at a lesser cost.

       The following are the prescribed policies on the use of consumption savings in kWh for electricity and liters for fuel, accumulated by agencies from the 12- month period starting September 1, 2005 and every year thereafter:

1. 1. 1. 1. For government entities which failed to attain the required minimum 10% savings, the use of its savings shall be limited to only 50% of their accumulated savings in kWh for electricity and liters for fuel.
         2. For government entities which attained 10% savings or more, they may be allowed to use 100% of their accumulated savings in kWh for electricity and liters for fuel.

       Consistent with the President’s directive dated May 31, 2008, agencies are authorized to use all savings generated from budgetary provisions for electricity and fuel. This effectively amends Section 3, Rule V of the IRR which provided certain limitations on the use of savings under said expenditure items.
       Only qualified agencies (i.e. those which generated savings from budgetary provisions for electricity and fuel corresponding to consumption reductions in kWh for electricity and liters for fuel), shall be authorized to grant transportation and rice subsidy to their employees.
       Since most agencies may be able to generate minimal savings only from fuel and electricity given the volatile costs of these items, the authority to use savings per O ffice of the President’s (OP) directive dated May 31, 2008 is expanded. In cases where savings of qualified agencies are not sufficient to fund the grant of transportation and rice subsidy, they are authorized to realign savings from other expenditure items of their budgets (consistent with the definition of savings provided under GP No. 60 of the 2008 GAA) to fund the grant of said incentives.
       The availability of savings under electricity and fuel should be consistent with two (2) year validity period of allotments under MOOE and CO as provided under GP No. 66 of the FY 2008 GAA. Thus, cumulative savings of agencies in electricity and fuel covered with lapsed allotments shall no longer be valid for availment as of effectivity date of this Circular (i.e. lapsed allotments issued from the period September 1, 2005 to December 31, 2006).
       Consistent with GP No. 17 of the FY 2008 GAA, savings generated from electricity and fuel after taking into consideration the agency’s full year requirements, may be realigned only in the last quarter of the year.
       Agency savings under electricity and fuel shall only be used to fund the following order or priorities as enumerated under Section 4 of Rule V of the IRR:

1. 1. 1. 1. Improvements in energy efficiency of the government entity/facility;
         2. Upgrade/lease/purchase of ve hicles to be used by employees as shuttle service;
         3. Purchase/lease of service vehicles to replace the old and inefficient units assigned to officials;
         4. Citations or recognitions; and
         5. Grant of other benefits to employees, consistent with the Collective Negotiation Agreement (CNA).

       Transportation subsidy, as cited in the May 31, 2008 OP directive, is already part of the existing non-wage benefits given by agencies to their employees as mentioned above. The grant of rice subsidy authorized under the said OP directive shall be subject to the respective CNA of agencies.
       Agencies that have generated savings from budgetary provisions for electricity and fuel corresponding to their consumption reductions in kWh and liters shall submit to DOE through the EAT, for verification and recommendation, their proposal to avail of the use of such savings.
       Consistent with the IRR of the GEMP, the EAT-DOE shall verify the energy conservation programs/measures adopted by the concerned agency and validate the reported consumption savings in kWh and liters, as basis for its recommendation on whether the agency is qualified to avail the use of savings.
       Based on favo rable recommendation of the EAT–DOE, the qualified agency shall submit to DBM on or before November 15 of the year, a request for realignment of generated savings under electricity and fuel to fund any of the priorities cited in the IRR including the grant of transportation and rice subsidy to its employees. In cases where savings generated from electricity and fuel is not sufficient, the agency concerned shall identify other sources of funds (i.e. savings from other expenditure items under its approved budget), provided still within the two-year validity period of allotment.
       DBM shall validate the savings requested for realignment by the qualified agency, from its submitted accountability reports (i.e. latest Statement of Allotments, Obligations and Balances and/or Financial Report of Operation). It shall also issue a Special Allotment Release Order (SARO ) to cover said realignment of savings in favor of qualified agencies (i.e. from savings under electricity and fuel or other expenditure items to appropriate expense item/s) to fund any of the priorities cited in the IRR including the grant of transportation and rice subsidy.
       Agencies are likewise reminded of the following rules and regulations on the use of savings for the grant of transportation subsidy (i.e. upgrade/lease/ purchase of motor and service vehicles):

1. 1. 1. 1. Dispose first unserviceable motor vehicles prior to the purchase of new ones. Proceeds from the sale of unserviceable vehicles shall be utilized for the purchase of new ones pursuant to Section 12 of the General Provisions of Republic Act No. 9498.
         2. Adhere to the provisions of NBC 446 and 446-A on motor vehicle classification and specification guide as well as A.O. No. 233 on strict prohibition of acquisition and use of luxury vehicles.