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February 1, 2000



SUBJECT    :     Guidelines In The Classification Of Existing And To Be Launched ARCs Pursuant
                           To The Sustainable Rural Development Framework For Agrarian Reform


I.          Background and Rationale:

In 1993, the Department of Agrarian Reform adopted the Agrarian Reform Community (ARC) Development Program as a key operating strategy in the provision of comprehensive development interventions on land tenure improvement (LTI) and program beneficiaries development (PBD). Correspondingly, the Agricultural and Fisheries Modernization Act (R.A. No. 8435) recognizes the ARCs as one of the model farms in the Strategic Agriculture and Fishery Development Zone (SAFDZ). 1

Under the Estrada Administration, agrarian reform agenda is grounded on three equally important principles with respect to the rural sector: economic development, social justice, and political democratization. Consistent with these three distinct but related principles, the implementation of the ARC Development Program was enhanced and expanded to contribute to the achievement of food security, poverty reduction, and countryside development.   HEIcDT

Relative to this, Memorandum Circular No. 05, series of 1999, "A Sustainable Rural Development Framework for Agrarian Reform Communities" was issued on 23 March 1999. This Memorandum Circular provides the expanded concept of ARC: scale implementation taking into consideration economic, ecological and socio-political factors; focused on marginalized sector; and gender sensitive and integrated area development perspective. The ARC expanded framework's operationalization requires the widening of area coverage by clustering and/or expanding existing ARCs to include other ARBs in contiguous land reformed barangays and launching of new ARCs.   DAEaTS

Likewise, Memorandum Circular No. 14, series of 1999 (Guidelines and Procedures in the Selection and Launching of ARCs) provides that aside from the MUST and WANT criteria stipulated in the Operations Manual on ARC Development, ARC selection shall also take into consideration the economic, ecological and socio-political factors.

As of December 1999, there are 1,031 ARCs launched nationwide. The need to classify the existing ARCs and the new ARCs to be launched up to year 2002 as provided for in MC 05 and 14 series of 1999 are the bases of this guidelines on ARC classification.

II.        Objectives:

1.         Outline the procedure to be undertaken by the field offices on the classification of existing and new ARCs to be launched;

2.         Present the classification tools to be used in the process of classifying existing and new ARCs; and

3.         Define the report requirements to be submitted for ARC classification.

III.       Methodology:

A.        Pre-Classification Activities for Existing ARCs

1.         Using existing municipal and provincial maps, assess the spatial relationship of existing ARCs in terms of their potential as agricultural growth centers in line with the Agrarian Reform and Rural Development Thrust of the Department and supportive of the Agriculture and Fisheries Modernization Act.

2.         Identify the adjacent land reformed barangays that may be integrated into the existing ARC.

3.         Using Annex A (Barangay Profile Format), the Development Facilitator (DF) shall prepare the barangay profile of new barangays, update the barangay profile of existing barangays and reflect in the location map the new barangays to be included. The basic information in accomplishing the barangay profiles shall be gathered from secondary data of government organizations, non-government organizations, peoples' organizations, other institutions and key informants.

4.         Prepare the ARC Pre-Classification Matrix (Annex B) utilizing the information from the profiles of existing and new barangays.

5.         With the aid of the ARC Pre-Classification Matrix, determine whether the existing ARC satisfies the scale consideration consistent with M.C. No. 5 and 14, series of 1999. If the existing ARC satisfies the scale consideration, there is no need to cluster and/or expand said ARC. However, if the economic, ecological and socio-political factors for scale implementation were not considered when the ARCs were launched, some ARCs may need to be clustered and/or expanded by covering adjacent land reformed barangays.

            The ARC category can be determined by analyzing the information/data in relation to the indicators in each parameter. The ARC shall be categorized into either of the following:

5.1       An ARC shall fall in the "ARC as is" category when —

           the economic, ecological, socio-political factors for scale implementation have been fully satisfied when launched

           has no adjoining ARC for clustering

           has no adjacent land reformed barangay/s for expansion

           is a plantation, settlement area or landed estate

5.2       An ARC shall fall under the "ARC Cluster" category if two or more ARCs in a given geographic area show that:

           there are similar geo-physical characteristics and crops produced

           ARCs can complement their production, processing and marketing activities

           there are physical infrastructure facilities that will link and support the production, processing and marketing activities of the ARCs

5.3       An ARC shall fall in the "ARC Expansion" category if there are land reformed barangays that can be added as its expansion area. Such barangays should have:

           similar geo-physical characteristics and crops produced with that of the existing ARCs

           can complement the production, processing and marketing activities of the ARC

           presence of physical infrastructure activities that would link and support production, processing and marketing activities of the barangays to the ARC

           the adjacent barangays qualify under the "must and want" criteria in the selection of ARC.

5.4       An ARC shall fall under the "ARC Expansion and Cluster" category if the conditions in items 5.2 and 5.3 above are satisfied.

6.         The result of the ARC category shall be indicated in Annex-C (the list of pre-classified ARCs).   HcSaTI

B.        Classification Procedures

            All ARCs categorized as reflected in Annex-C shall be subjected to the ARC Classification process utilizing standard instruments/forms.   ECaScD

1.         Standard Instruments/Forms

            The following instruments/forms shall be used for ARC classification:

1.1       Annex D (ARC Model Description) 2 describes the characteristics of the ARC model in terms of ecological, economic and socio-political considerations to ensure scale implementation of the ARC.

1.2       Annex E (Standards for the Classification of ARCs) describes the characteristics of the different ARC models (prime, semi-prime and satellite ARCs). It defines the standards per model per parameter and its corresponding indicators in terms of economic potentials, socio-political and ecological considerations. This shall serve as the guide in accomplishing the ARC Classification Matrix (Annex G). The standard indicators of the respective ARC Classification are presented per parameter. The classification of ARCs shall be subjected to a total of 22 indicators.

1.3       Annex F (Definition of Standard Indicators for ARC Classification) defines the standard indicators and the qualifying index of each parameter.

1.4       Annex G {ARC Classification Matrix), particularly column 2 will contain the basic information per ARC (as reflected in Annex-B) categorized as ARCs as is, ARC Cluster, ARC Expansion, ARC Cluster and Expansion. The basic information on ARC parameters and indicators on economic potentials, socio-political and ecological considerations shall be analyzed to determine its classification as an ARC. Annexes D, E and F shall be used to facilitate the classification process of each ARC.

1.5       Annex H (List of Classified ARCs) — this contains the final list of ARCs per model after undergoing the ARC Classification process.

            The process flow on ARC Classification is presented in Annex I.

2.         Determination of the ARC Classification

2.1.      The ARC classification process shall be done at the MARO level by the DF and MARO using Annex G, specifically Column 2 which was previously accomplished generating the information from Annexes A and B.

2.2       The ARC Classification Matrix-Column 3 of Annex G shall be accomplished by checking the appropriate column that best characterizes the ARC using the standard set forth in Annexes E and F.

2.3       All ARCs to be classified (both existing and those to be launched) shall be subjected to Economic, Socio-Political and Ecological parameters involving a total of 22 indicators.   aDcHIC

               Parameters                                      No. of Indicators

1.      Economic considerations                             10

2.      Socio-Political considerations                       7

3.      Ecological considerations                              5

         Total                                                              22

2.4       Count the number of check marks per parameter under the ARC Classification Column 3 in Annex G per model (prime, semi-prime and satellite).

2.5       Compute the percentage (%) rating per parameter by dividing the number of check marks with the total number of indicators per parameter. To get the overall percentage rating of the ARC, add the total number of check marks of the three parameters and divide it by the total number of indicators.


1.                     No. of points per Parameter

         % Pn = —————————————     x 100

                        No. of indicators per Parameter

2.                     Peco + Psoc + Pecol

         % Pt = —————————————      x 100

                        Total no. of indicators


% Pn =         percentage rating of the following parameters:

Peco =         point score for economic parameter

Psoc =         point score for socio-political parameter

Pecol =        point score for ecological parameter

% Pt =          total percentage rating for the ARC

2.6       Interpretation of the rating

2.6.1   Using the table below, plot the results of the computation per ARC to determine the ARC classification. (Actual results of the pilot testing were used to demonstrate the utilization of the table).   LLpr


                                        Prime              Semi-Prime     Satellite           Total

           Parameter           Check     %      Check    %      Check    %      Check    %


1.        Economic                 3        30          5        50          2        20        10      100



2.        Socio-Political          2        28          3        43          2        28          7      100



3.        Ecological                2        40          1        20          2        40          5      100



           Total                         7        32          9        41          6        27        22      100

2.6.2   The highest number of points or its equivalent percentage shall be the basis in determining the classification of ARCs.

2.6.3   Each classification (Prime, semi-prime and satellite) shall further be categorized into the following:

           High (Prime, Semi-prime, satellite) if the percentage of the total score (Pt) is above 75%

           Medium (Prime, semi-prime, satellite) if the percentage of the total score (Pt) is 50% to 75%

           Low (Prime, semi-prime, satellite) if the percentage of the total score (Pt) is below 50%

2.6.4   Summarize the result of the ARC classification process using the "List of Classified ARCs" (Annex H).


C.        Preparation and Transmittal of Report

1.         Preparation and submission of ARC Classification Report

            The MARO shall prepare and submit the ARC Classification Report for review and evaluation by the Provincial ARC Task Force (PARCTF). The report should contain the following information:   cTaDHS

a.         Covering/Transmittal Memorandum

b.         Barangay Profiles of existing and new barangays (Annex A)

c.         ARC Pre-Classification Matrix (Annex B)

d.         List of Pre-Classified ARCs (Annex C)

e.         ARC Classification Matrix (Annex G)

f.          Location with Vicinity Map of the ARC

The MARO is required to submit the report in two legible copies to the PARCTF. Additional copies may be required by the PARCTF, as necessary.

2.         Review, Evaluation and Approval

            Immediately upon receipt of the ARC Classification Report at the DARPO, the PARCTF shall:

a)         Determine the completeness of the documents based on the standard minimum requirements set forth in the ARC Classification Report.

b)        Review the report within five days upon receipt for its completeness, and accuracy of information.

c)         Prepare the consolidated Provincial ARC Classification Report for endorsement and approval by the Regional ARC Task Force (RARCTF).

            Within five days upon receipt of the Provincial ARC Classification Report the RARCTF shall:

a)         Evaluate the document and approve or disapprove the ARC classification.

b)        Prepare and submit to the National ARC Task Force (NARCTF) a consolidated report on the approved ARC Classification.

            When all pertinent documents and endorsements have been obtained at the DARCO, the NARCTF shall:

a)         Conduct final review, evaluate the recommendations and confirm the approval of classified ARCs.

b)        Disseminate the necessary information to all concerned units of the DAR and other CARP implementing agencies.

D.        Time Frame of Implementation

            Upon issuance of this Memorandum Circular, initial activities relative thereto shall immediately proceed as follows:

1.         Conduct of Orientation on ARC classification by the Regional ARC Task Force to the DFs, MAROs, and Provincial ARC Task Forces.

2.         Classify existing ARCs and submit the Regional ARC Classification Report not later than 31 March 2000.

3.         Classify all ARCs to be launched from CY 2000-2002 and submit the corresponding Regional ARC Classification Report on or before 31 March of each year until CY 2002.

IV.       Effectivity:   cEISAD

This Memorandum Circular shall take effect immediately and supersedes all orders and issuances inconsistent thereof.

Diliman, Quezon City February 1, 2000






  1.       The SAFDZ is the designated food basket of the country and shall serve as the integrating framework for the planning and allocation of national financial and economic resources and priority investments for the implementation of convergence Programs for national food security and poverty alleviation.

  2.       The ARC models as stipulated in MC Nos. 05 and 14, series of 1999 as prime agricultural ARC, in-between ARC and inaccessible ARC are renamed as prime agricultural ARC, semi-prime agricultural ARC and satellite ARC.





Barangay   ____________________________________________________________

Municipality  __________________________________________________________

Province  _____________________________________________________________


I.          General Features

A.        Topography of the Area

B.        Location

1.         Total Land Area (has.) ________________________________

2.         No. of Sitio/Puroks _________________________________

3.         Distance from Poblacion _______________________________

4.         Existing Means of Transportation ________________________

5.         Cost of transportation to and from barangay ________________

C.        Demography

1.         Population in CY ____________________________________

2.         Estimated No. of Households ___________________________

D.        Social Services and Infrastructure

1.         Type of Roads ______________________________________

2.         Condition of Roads ___________________________________

3.         Health Station _______________________________________

4.         Secondary School ____________________________________

5.         Water System _______________________________________

6.         Electricity __________________________________________

7.         Others (Specify) _____________________________________

E.         Natural Resources

1.         ——————————————————————

2.         ——————————————————————

II.        Land Use


  A. Land Use of the Area Phase I

1.   Agricultural lands _________________ Settlements ___________________

Landed Estates _________________

      Crop Lands ______________________ OLT Area _____________________

          Lowland Idle and Abandoned Lands _________

          Upland ________________________ VOS/VLT _____________________

      Pasture Land _____________________ GFI Foreclosed Lands ____________

      Others (specify) ___________________ PCGG Acquired Lands ___________

Total ______________________________ Govt. Owned Lands ______________

ISF __________________________

2.   Non-Agricultural Phase II

      Residential Land __________________ A & D Public Agricultural Lands

      Commercial ______________________ PAL > 50 Has. _________________

      Industrial ________________________

      Others (Specify) __________________

3.   Others (Specify) ___________________ Phase III

      Rivers and Roads __________________ PAL > 24-50 has. _______________

PAL < 50 has. __________________

Non-Land Transfer

          Program _________________


B. Land Category Leasehold ____________________

      Total Agricultural Land


      Total CARPable Area

      (by Phase) _________________________ Exclude those already under


CLOA Distributed



III        Agriculture

1.         Production

a.         Main Agricultural Crops

b.         Other Crops Cultivated

2.         Barangay Map

            A rough sketch of the barangay, i.e., without using a scale system. It would show relevant information of the barangay. Among others, it should indicate:

1.         Boundaries of the barangay

2.         Landmarks (location of community's facilities, etc.)

3.         Land type

4.         Farmlots

5.         Location of ARBs

IV.       Support Services Required

            (Physical Infrastructure Facilities, IGP, etc.)





Socio political


Prime Agricultural One to two Potential to A cluster of

ecological zones
become key
more than 5


center for

various crops Huge tracts of

Volume of

production and
lands (more than

land utilization
1,500 (hectares)

rate can support Significant

the market
number of small


Potential to
tural workers

project high
(more than 800


development &

integrated agri-

business system

Presence of





roads, post



Semi-Prime One to two Scale of A cluster of 2 to

Agricultural ARCs
ecological zones
5 contiguous

cannot meet the

market demands Substantial

Lands are not
tracts of

fully utilized

Can be a
lands (700 to

less than 1,500

support to prime

agricultural Substantial

number of

Can be a mid-
farmers and

processing and

market-link of
workers (400 to

the satellite
less than 800


Presence of




Satellite One ecological Low soil fertility A minimum of

zone Low production,
2-5 barangays

subsistence Limited


Absence of
lands (less than

critical physical
700 hectares)

infrastructure Substantial

number of small

farmers and


workers (100-

400 ARBs)




Department of Agrarian Reform
Elliptical Road, Diliman
Quezon City, Philippines
Tel. No.: (632) 928-7031 to 39

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