BAGUIO CITY – City officials recently authorized the City Mayor, representing the local government, to enter into a memorandum of agreement (MOA) with the Philippine Health Insurance Corporation (PHIC) represented by its president and chief executive officer, Emmanuel R. Ledesma, Jr. for the lease of the city-owned Mines View building.
Under Resolution No. 745, series of 2024, local legislators stated that this legal framework supports the decision of the local government to lease the Mines View building to the PHIC.
Earlier, the council considered a letter dated November 15, 2024 of Mayor Benjamin B. Magalong to enter into a MOA with the PHIC regional office for the lease of the city-owned Mines View building.
At present, the Mines View building is being rehabilitated and expected to be completed on or before the end of last month.
Further, the newly renovated building will be ready for occupancy by this month.
Sometime in 2021, the PHIC proposed to lease the city-owned building with a total area of some 2,005 square meters for its PHIC–Cordillera regional office. The proposal then was to rent the property at a price of PhP300 per square meter which is now increased to PhP350 per square meter.
Moreover, the total area to be leased by the local government is around 2,005 square meters that will yield an income of PhP701,750 per month and around PhP8,221,000 per annum to the city coffers.
Based on the recommendation of the city’s Local Finance Committee, the lease rate of PhP350 per square meter is considered fair and reasonable considering the location of the building which is quite far from the central business district or approximately five kilometers away.
On the other hand, the PHIC is also expected to invest around PhP13 million for leasehold improvements should the agreement proceed.
The council claimed that entering into a lease agreement with the PHIC would be a mutually beneficial arrangement as it would provide the necessary office space for the PHIC operations while optimizing the use of the city-owned property.
Under the pertinent provisions of Republic Act (RA) 9184 or the Government Procurement Act as amended, it is preferred that government agencies lease publicly-owned real property or venues from other government agencies and if there is an available publicly-owned owned real property or venue that complies with the requirements of the procuring entity, it may enter into a contract of lease with the government agency owner.
However, the council stipulated that the observations and manifestations of the local legislators shall be considered in the final draft of the proposed MOA to include allocated parking lots for the PHIC shall also be rented out; busted lighting fixture shall be replaced by the lessee; leasehold improvements shall be allowed only upon prior written approval of the lessor and that part of the same shall be an escalation clause.
The council required that the signed MOA shall be submitted to the local legislative body once signed for confirmation. By Dexter A. See
