Calapan City has been reclassified as a second-class city from its previous third-class status, according to Oriental Mindoro First District Congressman Arnan C. Panaligan.

The reclassification, effective under Republic Act No. 11964, is based on the city’s average annual regular income over the past three years, which showed notable growth through tax collections, service fees, and Internal Revenue Allotment (IRA) shares.

Congressman Panaligan, who played a paramount role in advocating for the House of Representatives’ version of the income thresholds, said the new law will benefit not only Calapan City but also other municipalities across the country.

Panaligan, one of the principal authors of the law, said the upgrade reflects the city’s fiscal performance during 2021, 2022, and 2023, which coincided with his final term as City Mayor.

Several municipalities in Oriental Mindoro also benefited from the reclassification, with Baco and Victoria elevated to first-class municipalities, and San Teodoro, Socorro, and Pola now classified as second-class municipalities.

Naujan and Puerto Galera retained their first-class municipality status.

The reclassification is a reflection of the local government units’ (LGUs) fiscal health, but Congressman Panaligan cautioned that it is not a direct indicator of development.

He pointed out the need for local officials to translate the increased income into meaningful developmental programs and enhanced public services.

The new law, also known as the “Automatic Income Classification Act for Local Government Units,” amends the Local Government Code of 1991 and provides an updated and fair assessment of LGUs’ fiscal capabilities.

The reclassification is expected to have a positive impact on the local economy, with increased investments and job opportunities, the Mindoreño lawmaker said.