The Bases Conversion and Development Authority (BCDA) expects to gain P2 billion in lease payments for the next 10 years from the Manila International Airport Authority (MIAA) for the land now occupied by the Ninoy Aquino International Airport Terminal 3.
In a statement, BCDA vice president for finance and chief financial officer Nena D. Radoc said the MIAA recently agreed to pay the BCDA P190.5 million yearly from 2013 to 2022 for the lease of the said piece of land. This property is owned by the BCDA.
The lease payment is subject to a 5-percent price escalation every five years in accordance with the original lease agreement, she said.
Upon the signing of the contract of lease in 1997, Radoc said an issue cropped up regarding the reckoning of the effective date of the lease. The BCDA and MIAA had opposing views on the interpretation of the lease contract’s provision on the starting date of payment.
“In essence there were two dates in the contract that specified the effective date of the lease. The first was the transfer of clean possession of the site which was Aug. 17, 1998 and the second, the in service date or when the airport becomes fully operational which, according to MIAA, has not happened yet,” Radoc said.
The issue was initially brought to the Office of the General Corporate Counsel, then to the Department of Justice and finally to the Office of the President.
However, the BCDA and MIAA chief executives agreed that it would be much more efficient to settle the issues amicably, which paved the way for the amicable settlement.
“The BCDA and MIAA jointly filed a motion to withdraw the pending appeal with the OP,” Radoc said.