THE Commission on Audit urged the Subic Bay Metropolitan Authority (SBMA) to address gaps in its listing of properties for lease to offer potential investors more options while improving the freeport’s sources of income and promoting transparency.
State auditors revealed there were commitments for available land and properties for development that were left out of the SBMA’s website together with the recommended rate or base rent.
Compounding the problem is the segmented control on lease agreements involving several offices under the freeport management. These are the Subic Bay Freeport (SBF) Enterprise, accounting department, treasury department, building permit and safety department (BPSD), and the Office of the Senior Deputy Administrator for Business and Investments (OSDABI).
“Although the reports from these departments are interconnected, each department needs to confirm with each other to ensure the accuracy of the reports. The Authority has no centralized monitoring system where the history/updates/status of lease agreements can be viewed and accessed by the BID, Treasury, BPSD, LEGAL, Land and Assets Development Department (LADD), and Accounting,” the COA noted.
A list of available properties for lease that the audit team obtained from LADD showed 19 locations as of 2023 but cross-checking revealed 12 were not on the Report of Inventory for Property, Plant, and Equipment.
Among these were the 21,779,700 square meter Redondo lot, the 24,842 sqm Times Square Commercial Center, the 118,400 sqm El Kabayo equestrian site, and the 14,500 sqm Triboa Bay properties.
“These properties resulting from development commitments should be properly identified, appraised/valued and recorded in the investment property account,” the COA said.
Auditors recommended that the SBMA regularly update its website to include all land/properties for lease with corresponding base rent; develop a centralized monitoring system accessible to all departments; upgrade the Subic Bay Freeport business registration system (SBFBRS) to make it more transparent and reflect real-time tracking of available properties; and to identify, appraise, and record all properties resulting from development commitments in the Investment Property accounts.
During the exit conference with the state auditors, the LADD committed to comply with audit recommendations.
