March 7, 2003
DAR OPINION NO. 2-B-03
MEMORANDUM
TO : Director Faisar A. Mambuay
DAR Regional Office No. 10
Macanhan, Carmen
Cagayan de Oro CitySUBJECT : The Metro Iligan Regional Agri-Industrial Center (MIRAIC) Municipality of Linamon, Province of Lanao del Norte
This refers to your Memorandum dated 05 November 2002, requesting that a Department Opinion be issued in favor of the MIRAIC to enable the National Land Use Committee (NLUC) to judiciously determine the viability of the 416-hectare MIRAIC area for conversion proceedings after the approval by the President of the reclassification of the entire MIRAIC site. IcHEaA
You stated, among others, that on 19 September 2001, Her Excellency, President Gloria Macapagal-Arroyo, issued Executive Order No. 36 declaring that the City of Iligan and the Province of Lanao del Norte shall form part of Region 10 (Northern Mindanao); that on 23 October 2001, the Regional Development Council, Region 10 (RDC 10) received an indorsement from the RDC Region 12 (RDC 12) regarding the proposition to establish the MIRAIC at Linamon, Lanao del Norte; that on 14 December 2001, the RDC10 formally and favorably indorsed to the National Economic and Development Authority (NEDA) Central Office the establishment of the MIRAIC through its Resolution No. 21 entitled, "Requesting President Gloria Macapagal-Arroyo to Proclaim Four Hundred Sixteen (416) Hectares of Land of Public and Private Domain Located in the Municipality of Linamon, Lanao del Norte, as the Site for the Metro Iligan Regional Agri-Industrial Center (MIRAIC) and Effecting Conversion of Land Use Therein from Agricultural to Industrial."; that MIRAIC is located some three kilometers from the Town Hall of Linamon and the Highway of Lanao del Norte; that it is a contiguous area which consists of 416 hectares, more or less; that the MIRAIC site comprises three (3) areas, namely: 1) 77.8 hectares are owned by the Provincial Government of Lanao del Norte, formerly under the administration of the Air Transportation Office as this was previously intended as the Linamon Airport — the DPWH then turned this over to the Province on April 17, 2000 through a Deed of Transfer; 2) 282.2 hectares are owned privately by individuals with and without titles over these lands; and 3) 56 hectares are owned by private individuals and corporations and were issued Notices of Coverage — these areas are sporadically situated within the 282.2-hectare area but notwithstanding the issuance of these notices, no further undertaking for the coverage of the landholdings proceeded; that the Department of Trade and Industry (DTI), pursuant to Department Order No. 81, series of 1988, proclaimed the MIRAIC as one of the DTI's Priority Special Projects; that the local government unit of Linamon took the cudgels as the MIRAIC proponent; and that you are now confronted with the following issues, among others, to wit:
1. The 416-hectare area is in excess of the 5% allowable limit for land use reclassification and conversion as Linamon is a 5th Class Municipality. Section 20, Republic Act No. 7160 (Local Government Code of 1991) clearly specified this legal requirement. Thus, the LGU of Linamon is requesting the national government through the Office of the President, the reclassification of the MIRAIC area which is in excess of the 5% allowable limit; and
2. The 56-hectare portion was issued with Notices of Coverage by the Department of Agrarian Reform pursuant to R.A. No. 6657 (the Comprehensive Agrarian Reform Law). Because of these Notices, the NLUC/NEDA is hesitant to recommend for the inclusion of these portions for reclassification as a prerequisite for conversion. NLUC/NEDA is requesting a DAR-Central Office's Opinion on the matter.
Relating to the issues posed in your memorandum, the following are the pertinent provisions of law, rules and regulations:
A. Section 20 (3) of RA 7160 (Local Government Code)
"Section 20. Reclassification of Lands. (a) A city or municipality may, through an ordinance passed by the sanggunian after conducting public hearings for the purpose, authorize the reclassification of agricultural lands and provide for the manner of their utilization or disposition in the following cases: (1) when the land ceases to be economically feasible and sound for agricultural purposes as determined by the Department of Agriculture or (2) where the land shall have substantially greater economic value for residential, commercial, or industrial purposes, as determined by the sanggunian concerned: Provided, That such reclassification shall be limited to the following percentage of the total agricultural land area at the time of the passage of the ordinance:
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(3) For fourth to sixth class municipalities, five percent (5%): Provided, further, That agricultural lands distributed to agrarian reform beneficiaries pursuant to Republic Act Numbered Sixty-six hundred fifty-seven (R.A. No. 6657), otherwise known as "The Comprehensive Agrarian Reform Law," shall not be affected by the said reclassification and the conversion of such lands into other purposes shall be governed by Section 65 of said Act. (emphasis supplied)
B. Section 1.d and 2.b.2, Memorandum Circular 54, series of 1993 of the Office of the President (Prescribing the Guidelines Governing Section 20 of RA 7160, Otherwise Known as the Local Government Code of 1991, Authorizing Cities and Municipalities to Reclassify Agricultural Lands into Non-Agricultural Uses): DCHIAS
"Section 1. Scope and limitations. (a) Cities and municipalities with comprehensive land use plans reviewed and approved in accordance with EO 72 (1993), may authorize the reclassification of agricultural lands into non-agricultural uses and provide for the manner of their utilization or disposition, subject to the limitations and other conditions prescribed in this Order.
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(d) In addition, the following types of agricultural lands shall not be covered by the said reclassification:
(1) Agricultural lands distributed to agrarian reform beneficiaries subject to Section 65 of RA 6657;
(2) Agricultural lands already issued a notice of coverage or voluntarily offered for coverage under CARP;
(3) Agricultural lands identified under AO 20, s. of 1992, as non-negotiable for conversion as follows:
(i) All irrigated lands where water is available to support rice and other crop production;
(ii) All irrigated lands where water is not available for rice and other crop production but within areas programmed for irrigation facility rehabilitation by DA and National Irrigation Administration (NIA); and
(iii) All irrigated lands already covered by irrigation projects with firm funding commitments at the time of the application for land conversion or reclassification. (emphasis supplied)
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Section 2. Requirements and Procedures for Reclassification. —
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(b) Prior to the enactment of an ordinance reclassifying agricultural lands as provided under Sec. 1 hereof, the sanggunian concerned must first secure the following certificates from the concerned national government agencies (NGAs):
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(2) A certification from DAR indicating that such lands are not distributed or not covered by a notice of coverage or not voluntarily offered for coverage under CARP." (emphasis supplied)
C. Section 5.1.i.1, Joint HLRB, DAR, DA, DILG Memorandum Circular, series of 1995 [Prescribing the Guidelines to Implement MC 54 (The Authority of Cities and Municipalities to Reclassify Lands Within the Limits Prescribed by Section 20 of RA 7160, Otherwise Known as the Local Government Code of 1991)]:
"Section 5. REQUIREMENTS FOR RECLASSIFICATION
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Section 5.1 The local government unit (LGU) through the City Development Council [CDC] or the Municipal Development Council [MDC], as the case maybe, shall submit to HLRB the proposal for reclassification together with the following requirements:
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i. DAR Certification (to be processed in one (1) month) [Reclassification Form "C"]
i.1 Certification from the Department of Agrarian Reform's Regional Center for Land Use Policy, Planning and Implementation (RCLUPPI)
indicating that such lands are not distributed or covered by Notice of Acquisition Under CARP." (emphasis supplied)
D. Section 1.B.2.b, Section 1.B.3.a, Section 1.B.5.c and Section 1.B.7 of Administrative Order No. 363, series of 1997 of the Office of the President (Prescribing Guidelines for the Protection of Areas Non-Negotiable for Conversion and Monitoring Compliance with Section 20 of the Local Government Code): prLL
"Section 1.B.2.b The following areas shall be highly restricted from conversion:
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2.b Lands issued a Notice of Acquisition/Valuation under the agrarian reform program or subject of a perfected agreement between the landowner and the beneficiaries under Voluntary Land Transfer (VLT) or Direct Payment Scheme (DPS) under CARP, as determined by the DAR; (emphasis supplied)
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Section 1.B.3.a Conversion of priority areas under Executive Order 124 (1993), as identified below, falling within the areas highly restricted from conversion may be allowed and the social benefit cost analysis for these areas may be waived; PROVIDED that the requirement of an EIC or ECC shall always be required; PROVIDED FURTHER that in no case shall conversion be allowed if these sites fall under those classified as non-negotiable areas:
3.a specific sites in regional agri-industrial centers/regional industrial centers (RAICs/RICs) identified by the Department of Trade and Industry (DTI) and the Department of Agriculture (DA), attached as Annex A; (emphasis supplied)
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Section 1.B.5.c . . . . The following requirements or certifications from various agencies shall also be required:
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5.c Certification from DAR indicating that such lands are not distributed or covered by a Notice of Valuation under CARP." (emphasis supplied)
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Section 1.B.7 In all cases, the decision of the DAR Secretary shall be appealable to the Office of the President. The President may allow the conversion of areas considered non-negotiable for conversion only upon the favorable recommendation of the Cabinet Cluster on Agro-Industrial Development; PROVIDED that where lands affected are irrigated, the owner developer shall be required to replace the areas affected by an equal area of irrigated lands, whether within or outside the area locality being applied for conversion; and PROVIDED FURTHER that such conversion shall not adversely affect the irrigation system. (emphasis supplied)
In view of all the above and subject to other existing provisions of law, rules and regulations, reclassification may be allowed provided there is compliance with the requirement of DAR Certification that subject lands are not distributed or covered by a notice of acquisition/valuation and, provided further, that, said lands are not classified as non-negotiable for conversion.
It is worthy to note and it may be inferred that what is now being required under Presidential Administrative Order No. 363 is a Certification from DAR that such lands are not covered as yet by a Notice of Acquisition/Valuation under CARP and no longer a DAR Certification indicating that such lands are not covered by a Notice of Coverage. The earlier requirement that there should be no Notice of Coverage issued as yet under Memorandum Circular No. 54, series of 1993 of the Office of the President appears to have now been amended by the latter requirement that there should be no Notice of Acquisition/Valuation under Administrative Order No. 363, series of 1997, likewise of the Office of the President.
Finally, it bears noting here the provisions of Sections 5.4 and 6.1.1 of DAR Administrative Order No. 1, series of 2002 (2002 Comprehensive Rules on Land Use Conversion), quote:
"Section 5. Areas Highly Restricted from Conversion — The following areas/projects are classified as highly restricted from conversion:
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5.4 Lands issued with notice of land valuation and acquisition, or subject of a perfected agreement between the landowner and the beneficiaries under the Voluntary Land Transfer (VLT)/Direct Payment Scheme (DPS) under the CARP; and
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Section 6. Priority Development Areas and Projects —
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6.1.1 Specific sites in Regional Agri-Industrial Centers/Regional Industrial Centers (RAIC/RIC) identified by the Department of Trade and Industry (DTI) and the DA pursuant to EO-124-1993. ADETca
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(emphasis supplied)
It is clear that the aforementioned highly restricted and priority development areas or projects will still have to undergo conversion process pursuant to the provisions of said guideline.
This opinion is rendered on the basis of the facts presented. However, if upon investigation it will be disclosed that the facts are different, then this opinion shall be considered null and void.
We hope to have clarified the matters and please be guided accordingly.
Very truly yours,
(SGD.) AUGUSTO P. QUIJANO
OIC-Undersecretary for Policy, Planning
and Legal Affairs Office