Deputy Alaín Albenis Cedeño Herrera, of circuit 8-6, filed Draft Bill 222 with the National Assembly on October 26, 2026. It amends Law 37 of 2009, on the decentralization of public administration, to address the emergency caused by the October 9 earthquake. The initiative is at the preliminary stage, pending sponsorship, and was referred to the Municipal Affairs Committee.

Its article 1 adds a transitional paragraph to article 112-D of Law 37: during fiscal years 2026 and 2027, the municipalities of Coclé, Herrera, Los Santos, Veraguas and any other area certified by the National Civil Protection System may allocate up to 100% of the amount they receive from property tax, including uncommitted balances, to operating and disaster mitigation expenses. Distribution would be made by municipal agreement, and the funds could be transferred to the community boards. Article 2 adds a numeral 8 to article 112-E allowing operating, social, administrative and mitigation expenses in those areas, under criteria set by the Office of the Comptroller General. Article 3 changes, for those same years, the allocation set out in article 112-G, which would take into account each unit's operating expenses, the services it provides, its territorial extension and population density.

The statement of reasons argues that current law restricts the share of these resources that can go to operations and that, in the midst of the crisis, mayors' offices and community boards need liquidity to buy medical supplies, water, food and hygiene kits, set up shelters and hire local labor. If approved, the measure could speed up purchases and temporary hiring in the central provinces, with an effect on suppliers and businesses in those communities; at the same time, it would shift to current spending resources that the decentralization law originally reserved for community investment.

The effect is not immediate. The text must be sponsored by the committee and approved in three debates before being signed into law; only then would it take effect, on the day after its promulgation, according to its article 5. Its usefulness would also be tied to the fiscal calendar: the paragraph covers only 2026 and 2027, so the time taken by the legislative process would reduce the room for use in the current year.

Nexo Capital will follow the progress of Draft Bill 222 in the Municipal Affairs Committee.

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