The Department of Budget and Management (DBM) has issued the guidelines for the use of the Php 11.3-billion financial assistance allocated to disadvantaged local government units under the 2026 national budget.
The funding is lodged under the Local Government Support Fund–Growth Equity Fund (LGSF-GEF), a program established in 2021 and amended in 2025 to reduce development gaps and address fiscal disparities, particularly among fourth- and fifth-income class LGUs.
Under Local Budget Circular No. 166 dated February 6, 2026, the DBM reminded LGUs to strictly comply with requirements for infrastructure projects under the 2026 General Appropriations Act, amid tighter scrutiny following the flood control corruption scandal.
The Php 11.3-billion allocation will be distributed nationwide, with Php 100 million going to Batanes province, Php 75 million each to nine cities, Php 30 million each to 274 municipalities, and Php 3.9 million each to 591 barangays.
The nine beneficiary cities are Vigan in Ilocos Sur; Palayan and Muñoz in Nueva Ecija; Cavite City; La Carlota and Victorias in Negros Occidental; Canlaon in Negros Oriental; Bogo in Cebu; and El Salvador in Misamis Oriental.
Under the new guidelines, each recipient LGU may implement up to two projects, which may include roads, school buildings, water supply and sanitation systems, health stations, electrification programs, or food security initiatives.
The DBM added that all approved projects must include a rainwater collection system.
The 2026 allocation marks a sharp increase from the Php 1 billion provided in the 2025 budget and forms part of the record Php 57.87 billion set aside for the LGSF this year.