SOP Library
SOP NO:
GM-WH03
(List of Exhibits/Attachments)
Mission
:
Technical Support Services
Area:
Grains Marketing (GM)
Area:
Grains Marketing (GM)
Activity:
Warehousing (GM-WH)
Title:
NFA Warehouse Leasing Program
Date Approved/Issued:
07/03/1985
Date Effective:
08/01/1985
Digest:
I. TERMS OF REFERENCE
A. Rationale
B. Objective
C. Scope
D. Basis
II. IMPLEMENTING GUIDELINES
1.
Warehouse Assessment
1.1 The Provincial Operations Officer, who is responsible in programming the stock, requirements and movements in the province, shall undertake the initial evaluation and recommendation on the leasing out of warehouses.
1.2 The Provincial Manager shall assess the warehousing requirements of the entire province and shall determine which warehouse may be made available for lease to third party.
1.3 It shall be the responsibility of the concerned province to justify recommendations for warehouses to be leased.
1.4 Areas for consideration in evaluating NFA owned warehouses for lease shall be the following:
a) Perfect utilization - if the average percent (%) utilization for the past two (2) years is below 35%.
b) Location - if the site of the warehouse is no longer strategic considering that the transfer and other stock movements are time consuming and costly.
c) Operational requirements - the projected operational volume of stocks to be handled.
d) No NFA owned facility is installed (in case of total lease).
2.
Warehouse Lease
2.1 NFA owned warehouses maybe offered to third party either for total lease or partial lease to be determined by the Provincial Manager.
2.2 Duration of lease shall be determined by the PM depending on the programmed/future projects of NFA that shall require its use or when harvest increases are expected in the area.
2.3 Commodities for storage shall not include explosives, chemical contaminants or other materials with residues/spillages which cannot easily be removed from the warehouse after lease.
2.4 Rental/storage rate shall follow prevailing commercial rates in the area.
3.
Partial Leased
3.1 For partial leased warehouses, partitions shall be installed and dismantled at lessee's expense. Warehouses shall be partitioned in such a way that there shall be at least one (1) entrance door solely for the use of the lessee.
3.2 The lessee shall be held liable for any damages to NFA stocks attributable to spillage/spoilage of lesse's commodities received for storage or stored in partitioned space within the same warehouse.
4.
Security
4.1 Lessees should not include suspected hoarders of prime/controlled commodities.
4.2 Lessee shall provide own security for leased warehouse and partitioned space.
4.3 The NFA shall provide control measures in the entry and exit of lessee's vehicles, personnel and customers, in case of partial lease or total leased warehouse inside NFA compound.
5.
Utilities
5.1
Electricity/water/telephone shall be for the account of lessee in case of whole warehouse/compound rented, or cost shall be inputted/prorated in case of partitioned space
lease.
6.
Authority
6.1 The Provincial Manager shall request from the Regional Director, authority to lease available warehouses or warehouse space to interested third party, and the approval of corresponding rates.
7.
Pro-Forma Contract
7.1 All contracts of warehouse lease entered into by the Regional Director shall strictly conform to the NFA pro-forma contract on warehouse lease.
7.2 If the contract is in consonance with the pro-forma, it shall be effective immediately upon signing by the Regional Director and Lessee.
8.
Amendments in the Contract
8.1 No amendments shall be made in the pro-forma contract without prior approval by the Director, DLA thru the Director, DGM. Otherwise, the Regional Director/Provincial Manager/OIC shall be held personally liable for consequent damages that the NFA may incur because of the said amendment/alteration.
8.2 Approved amendments or alterations in the pro-forma shall only apply to the particular province and lessee requesting for such.
9.
Requirements
9.1 New Contracts
The lessee, before execution of the Contract, shall be required to submit the following:
1. Police Clearance
2. Court Clearance
3. Income tax Return
4. Financial Statement
5. Marital Consent (for married lessee)
If the lessee is a corporation on partnership, aside from the aforementioned shall likewise submit the following:
1. Articles of Incorporation and by-laws
2. SEC Registration
3. Bureau of Cooperative Development Registration (if cooperative)
4. Authority of the representative to enter into contract with NFA
(i.e. Board Resolution)
9.2 Renewal
For renewal of contract, the lessee shall be required to submit the following:
1. Income Tax Return
2. Financial Statement
10. Approval of the Contract
All
warehouse lease contract
s recommended by the Provincial Manager shall be evaluated and approved by the Regional Director.
11. Payment Period
Payments shall be made on or before the seventh (7th) day of each current month. Other provisions on payment are stipulated in the contract.
12. Deposit
The lessee shall be required to deposit the amount equivalent to one month rent if duration of lease is three (3) months or less and a minimum of two (2) months rent if the period is more than three (3) months.
The deposit shall answer for any damage caused to NFA warehouse, facilities and stocks contained thereat.
Upon termination of contract, the deposit shall be returned to the lessee in case no damage/prejudice is caused to NFA.
13. Accounting Treatment
Collections shall be deposited to SALO Account:
DR: Cash-Collecting Officers xxx
CR: Operating and Service Income Rent xxx
Accounting entry for the lease deposit shall be:
DR: Cash-Collecting Officer xxx
CR: Depository liabilities - Miscellaneous - Lease
Deposit (reflect name of lessee/warehouse) xxx
14. Monitoring
NFA warehouses leased to third party shall be reported immediately thru wire to DGM for their information. The report shall contain name of lessee, duration and type of lease, name and location of warehouse and approved rental rates.
III. RESPONSIBILITIES
A.
Warehouse Assessment
1. Provincial Operations Officer (POO-18)
a) Programs the stock requirements and movements in the province and undertakes the initial evaluation and recommendation on the leasing out of warehouses.
2. Provincial Manager (PM-38)
a) Assesses the warehousing requirements of the entire province and determines which warehouse maybe made available for lease to third party.
b) Negotiates with interested lessees.
c) Recommends to the RD, thru wire, selected lessee with agreed terms and conditions.
3. Regional Director (RD-14
a) Evaluates and authorizes the Provincial Manager to lease out warehouse or warehouse space and approves corresponding rental rates.
B.
Processing of Contract
1. Provincial Operations Officer (POO-19
a) Prepares contract in nine (9) copies
b) Secures requirements from lessee.
c) Forwards the contract to the lessee for signature and notarization
d) Submits the contract to the Provincial Manager for signature.
2. Provincial Manager (PM-39)
a) Instructs POO to prepare contract.
b) Affixes his signature and forward same to the RD for approval/signature
c) Implements contract upon approval by the RD.
3. Regional Director (RD-15)
a) Evaluates contract, and if found in proper order, signs as NFA Representatives and have it notarized on the side of NFA.
b) Notifies the Provincial Manager approval of the contract.
c) Endorses a copy of the contract to DLA for confirmation
Copies shall be distributed as follows:
Copy 1 - DLA
2 - Lessee
3 - RD
4 - PM
5 - Provincial Auditor
6 & 7 - Notary Public - NFA
8 & 9 - Notary Public - Lessee
4. Department of Legal Affairs
a) Reviews contract and determines if in consonance with the pro-forma and legal requirements.
b) If so, confirms contract by furnishing the Provincial office confirmation memo or copy of confirmed contract.
c) If alterations were made without prior approval from Central Office, instructs, thru wire, the Provincial Office thru the Regional Director to hold the efficiency of the contract and determines actions to be undertaken.
C.
Amendments in the Contract
1. Provincial Manager (PM-40)
a) Requests Authority, thru wire, to alter certain provisions in the pro-forma specifying the
amendments.
2. Regional Director (RD-16
a) Evaluates and recommends approval.
3. DGM
a) Evaluates and if found in proper order, recommends to DLA for approval.
b) Otherwise, notifies the concerned field office disapproval of request.
4. DLA
Approves recommended amendments.
IV. FLOW CHART
Processing of Warehouse Lease Contract
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EXHIBITS
DFD-Processing of Warehouse Lease Contract
Warehouse Lease Contract