CH to avail of rice loan

The Cebu City government can now avail of a rice loan in case of emergencies or calamities after the City Council has authorized Mayor Tomas Osmeña to enter into a Memorandum of Agreement with the National Food Authority.

The City Council approved on May 23 the resolution authored by Councilor Alvin Arcilla authorizing Osmeña to sign on behalf of the city government the agreement to avail of the rice loan.

“In order to provide immediate assistance to their constituents, the LGU (local government unit) has requested NFA to allow them to purchase rice on credit for its relief operation whenever a state of calamity is declared either by the local legislative bodies or the Office of the President,” read the agreement.

Under the MOA, the city government can make a bulk purchase for stock piling in preparation for unwanted eventualities. The rice purchased on credit should be used solely for emergency cases or calamites.

“NFA reserves the right to inspect the warehouse and/or rice distribution centers of concerned local government unit to determine the compliance with the agreement,” read the agreement.

If the local government unit has an unpaid balance, additional credit may be allowed provided that the purchase will not exceed 200 bags for cities.

To purchase, any LGU is asked to submit a formal written request indicating the quantity of rice to be purchased. The approval of the City Council is needed before the local chief executive can request for the purchase.

Other documents needed for the rice loan are the certification as to the availability of funds, certification from the local government unit as to the number and location of the families that need the assistance, and among others.

The city should submit a list of its authorized representatives to withdraw stocks from NFA warehouse.

“The LGU shall pay NFA provincial office for the rice issued and the delivery fee, if any within 30 working days from date of receipt of billing. Any bill unpaid after the aforementioned period shall be subject to a penalty at the rate of 2 percent per month based on the amount due,” read the agreement.

The City Legal Office has already rendered its legal opinion on the agreement. The office states that the agreement complies with the basic legal requirements of a written contract.

The legal office asked the city’s executive department, however, that any purchase of rice on credit under the Rice Loan Memorandum of Agreement should be subjected to the provisions of Republic Act No. 9184 or the Government Procurement Reform Act.