nia-imt policy 2nd edition

IRRIGATION MANAGEMENT TRANSFERPOLICY AND IMPLEMENTING GUIDELINES

- Second Edition -

April 2011

Republika ng PilipinasDepartment of Agriculture

PAMBANSANG PANGASIWAAN NG PATUBIG(National Irrigation Administration)

EDSA, Diliman, Quezon City

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NIA IMT POLICY AND IMPLEMENTING GUIDELINESSecond Edition

TABLE OF CONTENTS

Topics Pages

NIA POLICY ON IRRIGATION MANAGEMENT TRANSFER

I. THE NIA IRRIGATION MANAGEMENT TRANSFER (IMT) POLICY 1

II. RATIONALE OF THE NIA IMT PROGRAM 1

III. LEGAL BASIS AND EXISTING POLICY ON IMT 2

IV. THE IMT PROGRAM AND ITS OBJECTIVES 2

V. COMPONENTS OF THE IMT PROGRAM 3

VI. THE IMT PROCESS 3

VII. COVERAGE 4

VIII.IRRIGATION MANAGEMENT TRANSFER CONTRACTS ANDRESPONSIBILITIES

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IX. COMPENSATION, PAYMENT SCHEDULE AND PAYMENT CRITERIA 5

X. DISPUTE/GRIEVANCE RESOLUTION 6

XI. CONTRACT SUSPENSION 6

XII. MONITORING AND EVALUATION SYSTEM 7

XIII. IA O&M SEED FUND 7

XIV. ALLOCATION OF IA INCOME FROM IMT 7

XV. FINANCING THE IMT PROGRAM 7

XVI. INSTITUTIONAL ARRANGEMENT 8

ANNEXES

Annex 1DESCRIPTION OF THE DIFFERENT IMT CONTRACTARRANGEMENTS

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Annex 2IRRIGATION MANAGEMENT TRANSFER (IMT) IMPLEMENTINGGUIDELINES

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I. THE NIA IMT POLICY 12

II. RATIONALE OF THE NIA IMT PROGRAM 12

III. LEGAL BASIS AND EXISTING POLICY ON IMT 13

IV. THE IMT PROGRAM AND ITS OBJECTIVES 14

V. COMPONENTS OF THE IMT PROGRAM 15

VI. THE IMT PROCESS 20

VII. COVERAGE 23

VIII.IRRIGATION MANAGEMENT TRANSFER CONTRACTSAND RESPONSIBILITIES

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IX.COMPENSATION, PAYMENT SCHEDULE AND PAYMENTCRITERIA

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X. DISPUTE/GRIEVANCE RESOLUTION 27

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Topics Pages

XI. CONTRACT SUSPENSION 27

XII. MONITORING AND EVALUATION SYSTEM 28

XIII. IA O&M SEED FUND 29

XIV. ALLOCATION OF IA INCOME FROM IMT 29

XV. FINANCING THE IMT PROGRAM 30

XVI. INSTITUTIONAL ARRANGEMENT 31

Annex 3MEMORANDUM OF UNDERSTANDING BY AND BETWEEN THENATIONAL IRRIGATION ADMINISTRATION AND IRRIGATORSASSOCIATION

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Annex 4 IRRIGATION MANAGEMENT TRANSFER (IMT) CONTRACT 36

Annex 5 NIA AND IA IMT RESPONSIBILITIES 46

Model 1 46

Model 2 49

Model 3 52

Model 4 55

Annex 6IA COMPENSATION AND NIA-IA ISF CURRENT ACCOUNTCOLLECTION SHARING SCHEME

57

Model 1 57

Model 2 59

Model 3 61

Model 4 62

Annex 7 NIA-IA ISF BACK ACCOUNT COLLECTION SHARING SCHEME 63

Model 1 63

Model 2 63

Model 3 63

Model 4 63

Annex 8 NIA AND IA IMT PERFORMANCE EVALUATION SYSTEM 64

Table 1 NIA IMT PERFORMANCE EVALUATION REPORT 73

Table 2 IA IMT PERFORMANCE EVALUATION REPORT 74

Table 3INSPECTION REPORT ON MAINTENANCE OF IRRIGATIONFACILITIES AND STRUCTURES UNDER IA RESPONSIBILITY

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NIA POLICY ON IRRIGATION MANAGEMENT TRANSFER1

Second Edition –April 2011

I. THE NIA IRRIGATION MANAGEMENT TRANSFER (IMT) POLICY

Irrigation Management Transfer (IMT) refers to the transfer from the NIA, the management,operation and maintenance of the National Irrigation Systems (NIS) to Irrigators Associations(IAs), wholly or partially, depending on the size of the NIS and capacity of the IA.

Pursuant to the NIA Charter and relevant legislations cited in Section III of this document:

IT IS THE POLICY OF THE NATIONAL IRRIGATION ADMINISTRATION TO PURSUEIMPROVED IRRIGATION SYSTEM PERFORMANCE, IRRIGATION SERVICE, ANDATTAIN FINANCIAL SUSTAINABILITY IN THE OPERATION AND MAINTENANCE OFTHE NATIONAL IRRIGATION SYSTEMS (NIS) THROUGH THE TRANSFER OF NISMANAGEMENT, PARTIALLY OR FULLY, TO DULY ORGANIZED IRRIGATORSASSOCIATIONS (IAS).

A summary description of the different IMT arrangements is attached as Annex 1. The IMTImplementation Guideline which describes in detail the implementation of the IMT Policy isattached as Annex 2, supplemented by Annexes 3, 4, 5, 6, 7, and 8.

The first edition of the IMT policy was issued as MC 47 s. of 2008. However, during theNational and Regional IMT Policy Orientation that were conducted in the later part of 2009 toearly 2010, there were issues, concerns and suggestions raised for the improvement of theIMT Policy and its Implementation Guidelines. Such were consolidated and further discussedby concerned Units of the NIA Central Office, and was the subject of a Workshop withrepresentatives from the RIOs, IMOs, IAs and FIAs in August 2010. Based on this, thesecond edition of the IMT Policy and Implementation Guidelines were formulated. It is hopedthat the second edition will settle all the issues and clarify the ambiguities and vague areasseen and experienced by the field offices on the implementation of the IMT policy.

II. RATIONALE OF THE NIA IMT PROGRAM

NIA started Participatory Irrigation Management (PIM) in National Irrigation Systems (NIS) inthe early 1980s, following the successful formulation, testing and nationwide adoption of IAorganization and participatory irrigation development in Communal Irrigation Systems (CIS).

The IMT in NIA evolved from the earlier PIM even in the absence of a clear and articulatedpolicy on IMT. IMT contract arrangements that evolved, however, somewhat differed fromone region to another. These differences are on ISF sharing arrangement, payment schemefor IA share and disposition of IA share among others. Due to this the NIA decided to issue awritten unified IMT Policy to avoid confusion and attain a more effective transfer of NISmanagement to duly organized IAs.

1 The IMT Policy was presented to and approved by the NIA Board of Directors on 26 May 2008during its 845

thRegular Board Meeting, as evidenced by the NIA Board of Directors’Resolution No.

7497-08 Series of 2008. The first edition was issued as Mc 47 s. 2008 on 29 September 2008




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The reasons and incentives for transferring management of NISs to IAs are:

NIA point of view:

a) Mandate of its charter and other relevant Philippine Laws;b) Expenses on operation and maintenance (O&M) exceed revenue from irrigation

service fee (ISF) collections;c) There is a need to improve NIS operation performance in terms of equitable

water delivery and distribution, narrow the gap between irrigated and service area,and increase ISF collection efficiency; and

d) Improvement of NIS performance needs the joint effort of NIA and farmers.

IA point of view:

a) Opportunity to develop their capacity for organizational and system management;b) Better chance for improvement of NIS performance as the IA directly manage

O&M;c) Opportunity to build-up IA capital; andd) Equitable opportunity for higher agricultural production and income for IA

members.

III. LEGAL BASIS AND EXISTING POLICY ON IMT

RA 3601 of 1963, the NIA Charter, as amended by PD 552 and PD 1701 authorizes NIA to“delegate the partial or full management of national irrigation systems to duly organizedcooperatives or associations”

RA 7607 of 1992, the Magna Carta of Small Farmers mandates the government to“encourage small farmers to join or form irrigators associations and promote participation offarmers to develop their capabilities to eventually assume the operation and maintenance ofirrigation systems and the responsibility of collecting fees from the individual members andremitting an amount to the NIA.”

RA 8435 of 1997, the Agriculture and Fisheries Modernization Act (AFMA) mandates NIA to“gradually turn over the operation and maintenance of the National Irrigation System (NIS)secondary canals and on-farm facilities to Irrigators Associations (IAs)”.

IV. THE IMT PROGRAM AND ITS OBJECTIVES

The program that implements the IMT policy and guidelines shall be called the “IrrigationManagement Transfer (IMT) Program”. The IMT Program supersedes or encompasses allother programs of NIA relating to the organization and development of IAs in the NISs, andthe transfer of management functions in the operation and maintenance of NISs from NIA toduly organized IAs.

The objectives of the IMT Program are the following:

a. Develop and institutionalize a strong and dynamic partnership between the NIAand the IAs for the delivery of efficient irrigation service to irrigated farmers;

b. Duly organized, registered, functional and self-reliant IAs capable and willing tooperate and maintain the NISs, wholly or partially.

c. Improved performance of the NISs and delivery of irrigation service, in terms ofequitable water distribution, and timely and reliable water deliveries. Performanceindicators are: a) more equitable water distribution, b) better timely and reliablewater deliveries, c) higher cropping intensity, and d) higher ISF collectionefficiency.

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d. Higher opportunities to farmers of NISs for better and more profitable agriculturalproduction. Farmers are expected to benefit from better irrigation service in termsof higher yields and farm incomes.

e. Sustainability and financial viability of the operation and maintenance of NISs andconsequently the IAs and the NIA. Improved NIS performance triggers betteragricultural production and profitability, willingness of farmers to pay ISF, higherISF collection efficiency and more funds for O&M of NIS, therefore, bettermaintenance and sustainable operation of NIS, and sustainable inflow of funds orincome to IAs and the NIA to support the O&M of NISs.

V. COMPONENTS OF THE IMT PROGRAM

The five (5) components needed to be addressed by the IMT Program are: a) IA Componentwhich is concerned with the organization and capability development of IAs; b) NIAPersonnel Component which addresses the preparation of NIA personnel at all levels of theorganization to enable them to perform their roles considering the IMT Programimplementation; c) Infrastructure Component which addresses the repair and rehabilitationprogram developed jointly by NIA and IA to address the identified physical deficiencies of thesystem; d) Monitoring and Evaluation (M&E) Component. which aims to provide the IA andNIA the needed management tools in assessing achievements on improving the systemO&M and IA development; and e) Linkages and Advocacy Component which addressesadvocacy activities to other government and non-government organization because the IMTProgram needs to be widely disseminated and fully supported by the NIA personnel, IA andrelevant agencies to expect a successful implementation of the same. A more detaileddiscussion of this section is presented in Annex 2.

VI. THE IMT PROCESS

The IMT process aims to develop and strengthen the IA to make them capable ofrecognizing their innate capacity and mobilizing their members to take on the challenge ofmanaging the O&M of the NIS, confidently and sincerely, through informed collectivedecision of all members.

The process has five phases: a) Phase 1 – The Preparatory Phase; b) Phase 2 – TheMobilization Phase; c) Phase 3 – The Participatory Planning Phase; d) Phase 4 – TheImplementation Phase; and e) Phase 5 –The Monitoring and Evaluation Phase. Describedin detail in Annex 2, the phases looks at the progressive development of the IA as a groupof water users, served and linked together by a common source or supply.

In like manner, the process also develops the capacity of the NIA O&M personnel to adapt tothe new regime of O&M in NIS, and gradually, adjust their activities to give way to thestronger presence of IA in O&M and provide the needed technical and managerialassistance the IA needs so that it will be able to comply with its contract obligations. Ifnecessary, these Staff will be provided with training to equip them with the necessary skills,knowledge and attitude to plan, implement, monitor and evaluate the IMT Program withintheir area of jurisdiction. These activities aim to promote: a) common understanding of theNIA IMT Policy and Program from the NIA Central Office to the Irrigation Systems Offices; b)common ownership of the Program; and c) develop the capability of the direct implementorsof the program.

It must be noted that the milestone to signal the start of the Implementation Phase is thesigning of a Memorandum of Understanding (MOU) between the NIA and the IA for theimplementation of the physical works identified, agreed and planned during the previousphases and he eventual transfer of O&M responsibilities to the IA under the IMT Program.The template for the MOU is attached as Annex 3.

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VII. COVERAGE

The IMT Program shall be implemented in all existing National Irrigation Systems (NISs)including those that are under construction.

Existing NIS O&M and/or management contracts will be modified to conform to this IMTPolicy subject to consultation and mutual agreement between the NIA and the IA, exceptthose under Type III and Stage III Contracts (which cover asset turn-over), unlessrenegotiated by IAs.

VIII. IRRIGATION MANAGEMENT TRANSFER CONTRACTS AND RESPONSIBILITIES

There are five basic functions in the management of irrigations systems which will becovered by IMT. These are: 1) operations; 2) maintenance; 3) fund management; 4)enforcement of procedures and resolution of water-related conflicts; and 5) agriculturalsupport services. The first four (4) functions are the ones usually being undertaken by NIAand the fifth function is accomplished through coordination with relevant government andnon-government entities.

Model Contracts. As mentioned earlier, the general description of the transfer strategies ispresented in Annex 1. The detailed NIA and IA responsibilities for each of the transferstrategies are presented in Annex 5. The IMT for NISs shall pursue the IMT contract modelsdescribed as follows:

IMTContract

NIA Responsibility IA Responsibility

Model 1

Manages the entire system buttransfers specific operation andmaintenance responsibilities tothe IA

a) Maintenance of canals (portion of maincanals, laterals and other irrigation facilitiesand structures within the coverage of the IAservice area); b) operation activities such asdischarge monitoring and preparation of listof irrigated and planted area; and c)distribution of irrigation service fee (ISF) billsand campaign for payment.

Depending on the capacity and willingness ofthe IA, ISF collection can be an addedresponsibility of the IA especially in NISs thathave very limited NIA Staff under the NIArationalized structure.

Model 2Manages the main system,from the headworks to the headgates of lateral canals

Management, Operation and Maintenance(O&M) of the laterals, sub-laterals, andterminal facilities.

Model 3

Manages the headworks andportion of main canal up to thejunction of the first lateral canalheadgate

Management, Operation and Maintenance(O&M) of the rest of the system from thejunction of the first lateral canal headgatedown to the farm level facilities. This is anexpanded form of Model 2.

Model 4Monitoring, evaluation andtechnical assistance of the IA

Full management, Operation andMaintenance (O&M) of the entire systemincluding the headworks

The preparation of ISF bills is considered for turn-over to the IA in Models 2, 3 and 4contracts. However, since ISF bill preparation is computerized, unless the IA procure theirown computer and have trained personnel to do the job, this responsibility cannot be turned-

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over to the IA. Hence, when the IA lacks the equipment and manpower to do ISF billpreparation, this shall be done by the NIA but the cost for such shall be considered as part ofthe NIA Cost in the determination of the O&M Cost “break-even point”and the NIA-IA ISFcollection share for Models 2 and 3. For Model 4, the cost of doing this shall be determinedand agreed by the NIA and the IA and shall be paid by the IA along with the IrrigationSystem Rental Fee. This shall be discussed and agreed during the NIA-IA IMT Contractnegotiation. The responsibility will be turned-over to the IA once they attain the capability toperform the job and at that time the IA and NIA ISF collection share will be re-negotiated.

Other Transfer Options. The NIA shall consider, on a case to case basis, other emergingpossibilities on IMT. Such options may include tripartite agreement among NIA, IA and LGU;and/or long-term lease contract; or management by competent third parties. These optionsare subject to the recommendation of the Head of the responsible organization within NIAthat handles the IMT Program and approval of the Administrator or the Board of Directors.

Contract Negotiation. To be eligible to negotiate for any IMT Contract, the IA must pass theIA IMT Contract Eligibility Criteria specified in Annex 8. The negotiation considers thewillingness and capability of the IA to undertake O&M responsibilities. The major points fordiscussion during the contract negotiation are the: a) NIA and IA responsibilities in the IMTContract; and b) compensation, payment schedule and payment criteria. The IMT Contractnegotiation must be carried out in an open and transparent manner. The template for theIMT Contract is presented in Annex 4.

The development of the capability of the IA to perform IMT Contract responsibilities is thefunction of the NIA. The capability development interventions that will be provided by the NIAto the IA must be based on an objective IA training needs evaluation and the list ofresponsibilities under the IMT contract targeted to be negotiated with the IA as discussed initem 1, Section V of Annex 2.

IX. COMPENSATION, PAYMENT SCHEDULE AND PAYMENT CRITERIA

The guidelines for determining IA remuneration for maintenance and IA share on ISFcollection of current and back accounts are shown in Annexes 6 and 7, respectively. Thedetails of the IMT compensation, payment schedule and payment criteria are presented inAnnex 1.

Compensation. The remunerations for canal maintenance (for Model 1) and share of the IAfrom ISF collections shall be subject to negotiation with the NIA based on the concept of “fairsharing of responsibilities and benefits”. In the concept of “fair share of responsibilities andbenefits”, “responsibilities”means the O&M responsibilities each party performs within theirrigation service area being considered for IMT; and “benefits”shall be interpreted as theremuneration and fair share of each party on the ISF collection within the area beingconsidered for IMT.

Due to the high cost of operating pump systems and the reduced ISF rates as specified byMC No. 41 s. 2007, all ISF collections shall first be allocated for payment of 50% of theenergy cost. The other 50% of the energy cost will be subsidized by NIA. Sharing of ISFcollections in excess of 50% of the energy cost, shall be negotiated by the IA and the NIAbased on the concept of “fair sharing of responsibilities and benefits”as mentioned above.

The details of the compensation arrangements are presented in Annexes 1, 6 and 7.

Payment Schedule. Payment of IA remuneration for canal maintenance must be done bythe NIA within one month after inspection by authorized NIA staff and the NIS Federationand submission of a report (Table 3) that the work done is satisfactory and eligible forpayment.

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Payment of IA ISF collection shares (for all Contracts) shall be done within one month fromthe end of the collection period after a transparent NIA-IA reconciliation of the total ISFcollections, remittances and collection efficiencies within the IA service area. (Refer toAnnex 1).

Payment Criteria. The criteria for paying IA remuneration on canal maintenance for Model 1and IA ISF collection share for any of the IMT Contracts are presented in Annex 1. Itpresents in general, the basis of payment on IA remuneration for canal maintenance and IAISF collection share. It includes penalties in case of delayed payments to IA in the case ofNIA and failure to remit full NIA ISF collection share for Models 2 and 3 Contracts, andfailure to pay Irrigation System Rental Fee for Model 4 contract.

The process, deadlines and sanctions on payment and remittances of ISF Collections eitherfor Current or Back Account Collections by IAs shall be subject to existing accounting andauditing rules and regulations and are not part of this document. However, such shall beinformed or properly disseminated by the NIA to the IA for their compliance.

X. DISPUTE/GRIEVANCE RESOLUTION

The NIA through the Head Staff at the NIS level and the IA President representing the IAconcerned shall make every effort to resolve amicably any dispute/grievance arising out ofthe IMT Contract. When a dispute/grievance is not amicably resolved by the contractingparties, the following process is recommended.

1. The System Management Committee (SMC) is the first level of responsibility forresolving dispute/grievance at the system level. The SMC as specified in MC 36 s.19972 is composed of concerned NIA Staff and IA/FIA Presidents. In the SMC therepresentation of relevant government agencies. LGUs and other institutions are oncall basis or as need arises.

2. Any dispute/grievance that is not settled by the SMC will be elevated to the Managerof the Irrigation Management Office (IMO) who will try to resolve such in coordinationwith the President and Board of Trustees of the Provincial Federation of IAs andconcerned IMO Staff. If necessary, the mediation of the Provincial/MunicipalGovernment may be sought for the resolution of the dispute/grievance.

3. If the dispute/grievance is not resolved at the IMO level, such shall be elevated orendorsed to the Regional Irrigation Manager who will coordinate with the Presidentand Board of Trustees of the Regional Federation of IAs in resolving thedispute/grievance.

4. In any case that the NIA and IA/FIA concerned: 1) do not agree to submit to theabove process; 2) do not arrive on a mutually agreed solution; or 3) thedispute/grievance is not resolved through the above process, such shall be submittedto any court of law that has jurisdiction thereof or as indicated in the Section onSettlement of Disputes of the NIA-IA IMT Contract.

XI. CONTRACT SUSPENSION

Contract suspension may be resorted to only when: a) the delivery of irrigation service tofarmers; and b) the viability of operating and maintaining the irrigation system are negativelyaffected, as in the following cases:

2With the changes in the NIA Structure and Staffing due to the Rationalization Plan, particularly at the

NIS level, MC 36 s. 1997 has to be revised.

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1. Unresolved dispute/grievance resulting to disruption of the IMT contract arrangement2. Poor NIA or IA IMT Performance affecting irrigation service and financial viability of

the system

These are further discussed in Section XI of Annex 2.

XII. MONITORING AND EVALUATION SYSTEM

There are two major components in the monitoring and evaluation (M&E) system in theimplementation of the IMT Program, namely: a) NIA IMT Performance Evaluation; and b) theIA IMT Performance Evaluation.

The NIA IMT Performance Evaluation covers indicators related to; a) assistance for theorganization and capability development of the IAs; b) implementation of water deliveryschedules based on O&M plan; and c) repair, improvement and/or rehabilitation of thephysical facilities (irrigation, drainage and drainage). The evaluation scheme is presented inAnnex 8.

The eligibility of an IA to negotiate for an IMT Contract is determined based on the IA IMTEligibility Criteria in Annex 8. After successfully negotiating and signing an IMT Contract, theseasonal IA IMT Performance is evaluated through the IA IMT Performance Evaluation, alsodiscussed in Annex 8, which evaluates the IA performance on their responsibilities asspecified in their IMT Contract.

The IA IMT Performance Evaluation is different from the annual IA Functionality Survey3

which is done to assess the functionality IAs on a yearly basis, and on three (3) majorgroups of indicators namely: a) Operation and Maintenance; b) Organizational Management;and c) Financial Management in a more detailed manner.

XIII. IA O&M SEED FUND

For new IAs or IAs which are not yet financially capable of financing their O&M cost, the NIAshall provide IA O&M Seed Fund equivalent to the IA O&M Cost Requirement for onecropping season or as agreed by both parties. The IA O&M Seed Fund shall be paid in fullwithout interest by the IA upon receiving its incentives/ISF Share for the season. The IAO&M Seed Fund can be provided from initial ISF collections subject to negotiation andagreement by both parties.

XIV. ALLOCATION OF IA INCOME FROM IMT

It must be emphasized that the IMT remunerations and incentives shall be used primarily forirrigation-related activities.

It is the policy of NIA to ensure the sustainability of the NIS whose irrigation managementhas been transferred to the IA. In order to attain this, the disposition of the IA yearly incomemust be balanced for the various operations expenses. The yearly budget and expendituresof the IA is recommended at 40 percent for personal services and 60 percent formaintenance and other operating expenses (MOOE).

XV. FINANCING OF THE IMT PROGRAM

The IMT Program shall be funded through on-going projects whether new NIS under

3The IA Functionality Survey has to be revised to consider changes on the IA responsibilities in the

new IMT Model Contracts.

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construction and existing NIS under rehabilitation and modernization. The ProjectInstitutional Development Division (IDD) and the Regional Engineering and OperationsDivision (EOD) shall align all their institutional development programs to be consistent withthis IMT policy. The Project Manager (PM) and the Regional Irrigation Manager (RIM) shallmake sure that the IMT Program is properly funded and supported.

The existing NISs that are not covered under any on-going and proposed projects shallpursue the IMT Program through the yearly allocation for NIS Repair and RehabilitationFund appropriated to the NIA through the General Appropriations Act. The DeputyAdministrator of the Engineering and Operations Sector shall ensure that NIS Repair andRehabilitation Fund fully support the components of the IMT Program.

As a general rule, five (5) percent of the allocation for civil works in all local and foreignfunded projects must be allotted to support the IMT Program for the system or project (new)under repair, rehabilitation or construction. The budget, however, must be firmed-up throughthe preparation of an IMT Program of Work (POW) to be submitted to the DeputyAdministrator for Engineering and Operations for approval. IMT POWs will be reviewed andconsolidated by the Operations Department through the Institutional Development Division atthe NIA Central Office.

XVI. INSTITUTIONAL ARRANGEMENT

The Irrigation Management Transfer (IMT) Program is the program of the National IrrigationAdministration and every single unit of the agency has inherent functions and responsibilityto perform in supporting the program implementation.

Within the NIA Rationalized Structure, the Administrator through the Office of theDeputy Administrator of the Engineering and Operations Sector shall be responsible forthe overall planning and implementation of the IMT Program. The Operations Department(OD) through its Systems Management Division (SMD) and Institutional DevelopmentDivision (IDD) shall take the lead in the planning, implementation and monitoring of the IMTProgram. Specifically, it is responsible of: a) review and consolidation of IMT Programs forall NISs; b) formulating and disseminating the IMT policies and guidelines; b) provide trainingto institutional development (ID) and relevant O&M staff at the RIO and IMO to prepare themto implement the IMT Program; c) assist the Regional Engineering and Operation Division(EOD) in preparing work and financial programs; d) assist the EOD in training ID andrelevant O&M staff at the IMO and system levels; e) monitor and evaluate theimplementation of the IMT Program; f) conduct assessment surveys as necessary; and g)assist the RIO and IMO in solving problems that affect the IMT Program planning andimplementation.

The Regional Irrigation Manager through the Regional Engineering and OperationsDivision (EOD) shall take the lead in managing the IMT Program at the regional level andshall assist all IMOs within the region.

At the Irrigation Management Office (IMO) level, the Division Manager through the O&MSection shall lead the implementation of the Program for each NIS within the IMO coverage.

At the system level, the most Senior Staff or Staff designated as head of the System,through the Senior Irrigators Development Officers (SIDOs) and/or IrrigatorsDevelopment Officers (IDOs), and/or the Senior Water Resources FacilitiesTechnicians (SWRFT) are the direct implementors of the IMT Program.

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List of revisions done on the Second Edition of the NIA IMT Policy

Second Edition MC 47 s. 2008

1. (Page 1) Section 1. Statement of IMT Policy (Page 4) Section 4, Same content

2. Main Text of the IMT Policy reduced to 8 pages,limited to general declaration of provisions on theIMT Policy

Main Text is 17 pages with lots ofduplication with Annex 1, the IMTGuidelines

3. (Page 9) Annex 1 presents clear description of theIMT contracts, compensation, payment scheduleand payment criteria

(Page 51) Annex 2 does not providefor payment schedule and paymentcriteria

4. () Annex 2, the IMT Guidelines issupported by eight (8) distinct Annexes for easylocation of topics.

IMT Guidelines only three (3)Annexes. It is difficult to find specifictopics on the guideline such asdetermination of NIA-IA sharingscheme, NIA-IA performanceevaluation, etc.

5. (Page 33) Annex 3, MOU Template for systemimprovement/rehabilitation between the NIA and IA

(Page 53) Annex 1, Attachment 1-1,Same Content

6. (Page 36) Annex 4, IMT Contract Template.Improved with additional instructions for clarity

(Page 53) Annex 3

7. (Page 59) In determining the O&M Cost “Break-Even Point”as basis for the NIA-IA ISF collectionsharing scheme, it was recommended by the IDDCO to include a NIA-CO share of 13% based oncomputations made by Engr. RSGamboa. In thedocument it is suggested to be at 10% consideringthat the NIA CO had other source of income suchas the Management Fee and Equipment Rental.

(Page 49) No NIA-CO sharespecified

8. (Page 46) Annex 5, Detailed NIA and IAresponsibilities for the different Models

(Page 30) Not as detailed as thesecond edition

9. (Page 57) Annex 6, Detailed scheme ondetermining IA remuneration for maintenance andNIA-IA ISF collection sharing scheme

(Pages 68 to 70) Not as detailed asthe second edition

10. (Page 63) Annex 7, Compensation on BackAccounts

Not included

11. (Page 64) Annex 8, The NIA-IA IMT PerformanceEvaluation is attached

(Pages 23 and 24) For the NIA IMTperformance (Pages 15 and 45) forthe IA IMT performance

12. (Pages 4 and 25) For Model 1, it is recommendedthat ISF collection shall be considered for transferas IA responsibility depending on capability andwillingness of the IA.

Not specified

13. (Pages 4 and 25) For Models 2, 3 and 4 contracts),Since ISF Bill is computerized, IAs need to procurecomputers and the development of computerknowledge and skills. Some RIOs and IMOs areconcerned whether such can be transferredoutright to IAs. Hence, it is recommended to havethe flexibility that the preparation of bills betransferred to the IA only when it has theequipment and tested capacity to do so.

(Page 33) Specified for transfer to IAfor Models 2, 3 and 4 contracts (noflexibilities provided)

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Second Edition MC 47 s. 2008

14. (Pages 5 and 26) Considering MC 41 s. 2007,which reduced the ISF Rates for pumps by 50%, itis recommended to specify in the IMT Policy thatonly 50% of the energy cost shall be considered ascost in the computation of “break-even point”andthe NIA-IA sharing scheme on ISF collection

Not specified

15. (Pages 6 and 27) Dispute and grievance (relativeto IMT contracts) resolution was revised to involveonly units within the NIA, System ManagementCommittee and the Federation of IAs.

(Page 11) It was defined thatConflict/Grievance not resolved atthe system and regional level will beelevated to the DA ManagementCommittee headed by the DASecretary.

16. (Page 6 and 27) A Section on Contract Suspensionis included

Nothing relative to contractsuspension

17. (Pages 8 and 31) Financing the IMT Program. It isrecommended that 5% of civil works allocation fromany project (local or foreign) be allotted to financeIMT Programs with the requirement that an IMTPOW be prepared and approved to firm-up theallocation. The 5% allocation for IMT Programs isspecified under MC 59 s. 2003 but such is notbeing followed. Less than 5% (3% in most cases,as per feedback of field level IDS Staff), is beingallotted for IMT Program financing.

(Page 15) No percentage specified

18. (Page 9) For Model 1, it was recommended by fieldlevel IDS Staff that the base collection efficiency(CE) where IAs start to have ISF collection sharebe at 55%. The IA share is pegged at 1% to 15%for collections above the agreed base CE.

(Page 12) It was specified that suchshall be based on the average basecollection efficiency (BCE) within theIA area before the signing of thecontract and it is not the same forareas having average BCE of below60% (1% - 25%) and BCE of above60% (1% - 15%)

19. (Page 11) The IA will pay NIA an Irrigation SystemRental Fee and will contribute 30% of the cost ofmajor repair and rehabilitation after contractsigning.

() The IA will pay TechnicalAssistance Fee and repay all the costof repair and rehabilitation financedby the NIA after contract signing atzero interest.

20. (Page 19) The MC on “Patubigayan Trust Fund”isnot yet issued. The proposal is with the OperationsDepartment.

21. (Page 47) Coverage of IA for repair andmaintenance may include portion of main canalwithin the IA area of responsibility

(Page 32) not specified

MC No. _27_ S. 2011

MEMORANDUM CIRCULAR

MEMORANDUM

TO : THE SENIOR DEPUTY ADMINISTRATOR, DEPUTY ADMINISTRATORS,DEPARTMENT MANAGERS, REGIONAL IRRIGATION MANAGERS,OPERATION MANAGERS, PROJECT MANAGERS, PROVINCIALIRRIGATION MANAGEMENT OFFICERS AND ALL OTHERSCONCERNED

FROM : THE ADMINISTRATOR

SUBJECT : SECOND EDITION OF THE NIA IMT POLICY AND IMPLEMENTINGGUIDELINES

This Memorandum Circular supersedes MC 47 s. 2008 entitled The NIA IMT Policy andImplementing Guidelines. This is the second edition of the NIA IMT Policy and ImplementingGuidelines which was prepared due to issues and clarifications raised by field offices during andafter the RIO and IMO IMT Orientation Workshops conducted within 2009 to 2010.

It is, however, reiterated that pursuant to the NIA Board of Directors’Resolution No. 7497-08Series of 2008 dated 26 May 2008, the attached second edition of the NIA IrrigationManagement Transfer (IMT) Policy and Implementing Guidelines are issued as references in theplanning and implementation of irrigation development and improvement programs particularly inthe management of the Operation and Maintenance of all National Irrigation Systems (NISs).

Any program that implements the policy and guidelines within the purview of the IMT shall becalled the “Irrigation Management Transfer (IMT) Program”. The IMT Program encompassesall other programs of NIA relating to the organization and development of IAs in all NISs as wellas in all irrigation projects undergoing construction, rehabilitation and/or modernization.

Existing NIS management contracts will be reviewed and modified or revoked to conform to thisIMT Policy subject to consultation and mutual agreement between the NIA and the IAsconcerned, except those under Type III and Stage III Contracts (which covers asset turn-over),unless otherwise renegotiated to the IMT Models. All new IMT contracts shall conform to themodels set forth in this IMT Policy and Implementation Guidelines.

All memorandum circulars or parts thereof that are inconsistent with the provisions of this SecondEdition of the NIA IMT Policy are hereby revoked and/or modified accordingly.

This Memorandum Circular shall take effect immediately.

For strict compliance.

ANTONIO S. NANGELAdministratorDPG - AAG -LGBR -




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GENERAL DESCRIPTION OF THE DIFFERENT IMT CONTRACT ARRANGEMENTS

Contract/Responsibilities

Compensation Payment Schedule Payment Criteria

Model 1

The NIA Manages theentire system buttransfers specificoperation andmaintenance activitiesto the IA

The IA will beresponsible of: a)Maintenance of canals;b) operation activitiessuch as dischargemonitoring andpreparation of list ofirrigated and plantedarea; c) distribution ofirrigation service fee(ISF) bills; and d)campaign for payment.

1. For Canal Maintenance:

Based on standard labor capacities in canal maintenanceand the wage rate based on the Regional Wage Board(Non-Agricultural Workers).

Within one month afterinspection byauthorized NIA staffand the NIS IAFederation andsubmission of a reportthat the maintenancework done issatisfactory and eligiblefor payment.

For IAs:

Unsatisfactory evaluation result will mean that the IAis not eligible to receive the compensation for themaintenance work evaluated until the work isrectified or done satisfactorily.

For NIA:

Delayed payment in excess of one month shall besubject to payment of an interest of 0.5% per month.Fraction of a month is considered one month.

2. IA Share on ISF Current Account Collection:

Scale of 0% to 15% of total ISF collection. The suggestedbase ISF collection level to be negotiated with the IA is55%. If this is the agreed base collection level, the IAstarts to have a share of the ISF collection atpercentages above 55% to 100%. This is equal to 1/3 %for every one (1) percent incremental increase from 55%

3. IA Share on ISF Back Account Collection:Back Accounts before the signing of the Contract:

a) IA: 25%b)NIA: 75%

Back accounts after signing of the Contract:a) IA: 5% ofb)NIA: 95%

Within one month afterthe end of the collectionperiod and/orcompletion of the jointNIA-IA assessment andreconciliation of recordsof collections, collectionefficiency andremittances within theIA Service Area.

For IA:

The IA is not eligible to receive incentives at ISFcollections percentage equal or lower than theagreed base ISF collection percentage.

For NIA:

Failure to pay the IA share within one month after theend of the collection period and/or completion of thejoint NIA-IA assessment and reconciliation, the IAShare shall earn 0.5% interest per month of delay.Fraction of a month is considered one month.

Model 2

NIA manages the mainsystem, from theheadworks to the maincanal up to theheadgates of lateralcanals.

1. IA Share on ISF Current Account Collection:

(Canal maintenance is not separately compensated.Compensation for this is an integral part of the IA Sharefrom ISF Current Account Collection.)

Within one month afterthe end of the collectionperiod and/orcompletion of the jointNIA-IA assessment and

For the IA:

1. If the IA ISF collection fails to meet/pay in full theagreed NIA share from current accountcollectibles in a specific season, the deficit shall

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Model 2

The IA is responsiblefor the management ofthe laterals, sub-lateralsand terminal facilitieswithin the coverage ofthe IA service area.

For gravity systems, this shall be negotiated based onthe NIA and IA percentage share of the Break-EvenO&M Cost of the system.

For pump systems, all ISF collections shall first beallocated for payment of 50% of the energy cost. Theother 50% of the energy cost will be subsidized by NIAas directed under MC No. 41 s. 2007. Sharing of ISFcollections in excess of 50% of the energy cost, shall benegotiated by the IA and the NIA based on theconcept of “fair sharing of responsibilities andbenefits” similar to that for Model 2 Gravity Systemsabove.

2. IA Share on ISF Back Account Collection:

Back Accounts before signing of the Model 2 Contract:a) IA: 25%b)NIA : 75%

Back accounts after signing of the Model 2 Contract arethe responsibility of the IA.

reconciliation of recordsof collections, collectionefficiency andremittances within theIA Service Area

be considered as back account payable of the IAto NIA.

2. Unpaid NIA share will earn an interest of 0.5%per month. Fraction of a month is considered onemonth.

3. IA shares from ISF collection for the succeedingseason will be applied first to their back account.

4. In case of unsatisfactory evaluation of canalrepair and maintenance, the IA will be asked bythe NIA to rectify or accomplish the worksatisfactorily. Otherwise, the NIA will deduct thecost of canal repair and maintenance from the IAShare, at a rate computed following thecomputation of IA remuneration for canal repairand maintenance for Model 1 Contracts. The NIAshall use the amount to pay for the repair andmaintenance of the canal section.

For NIA:

Failure to pay the IA share within one month after theend of the collection period, the IA Share shall earn0.5% interest per month of delay. Fraction of onemonth is considered one month.

Model 3

The NIA manages theheadworks and portionof main canal up to thejunction of the firstlateral canal headgate.

The IA is responsibleon the management,operation and

1. IA Share on ISF Current Account Collection

The NIA-IA Sharing Scheme shall be determined similarto Model 2

2. IA Share on ISF Back Account Collection

(If the IA did not pass through Model 2 Contract) BackAccounts before the signing of the Model 3 Contract:

Same as Model 2 Same as Model 2

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maintenance (O&M) ofthe rest of the systemfrom the junction of thefirst lateral canalheadgate down to thefarm level facilities.

a) IA :25% ofb) NIA :75% of

Back accounts after signing of the Model 2 or Model 3Contract are the responsibility of the IA.

Model 4

NIA transfers to the IAthe full management ofthe irrigation systemincluding theheadworks andprovides only technicalassistance to the IA onthe management oftheir organization andthe O&M of theirrigation system.

The IA manages theirrigation system. Itbecomes responsible ofO&M planningimplementation,monitoring andevaluation for the entiresystem, including thesetting up andcollecting ISF rates,and irrigation systemimprovement/modernization program.

The IA will be responsible of collection, safekeeping andmanagement of ISF. The IA will pay to NIA an IrrigationSystem Rental Fee equivalent to the money value of 1.50cavans of dry paddy (computed at the government supportprice of palay at the time of billing) per hectare per yearbased on the firmed-up service area (FUSA) of thesystem. The System Rental Fee will cover the cost oftechnical assistance and cost of using the irrigationfacilities and structures.

In cases of major damages due to “force majeure”and/ormajor repair and rehabilitation beyond the financialcapacity of the IA, the NIA will be responsible for doing thedetailed engineering and implementation of the repairworks with IA participation and will finance 70% of thecost. The IA will finance 30% of the cost and assist theNIA in the planning and implementation.

IA Share on ISF Back Account Collection

(If the IA did not pass through Model 2 or 3 Contract) BackAccounts before the signing of the Model 4 Contract:

a) IA :25% ofb) NIA:75% of

Back accounts after signing of the Model 2, Model 3 orModel 4 Contract are the responsibility of the IA.

The Irrigation SystemRental Fee is payablein two (2) equalinstallments of themoney value of 37.50kg of dry palay payablefor each season (wetand dry seasons).

Payment of the SystemRental Fee installmentsshall be within onemonth from the end ofISF collection period forevery season after anopen or transparentjoint NIA-IAassessment andreconciliation of thetotal ISF collections,collection efficiency andremittances within theIA service area

For the IA:

Unpaid Irrigation System Rental Fee will earn aninterest of 0.5% per month. Fraction of a month isconsidered one month.

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IRRIGATION MANAGEMENT TRANSFER (IMT) POLICYIMPLEMENTING GUIDELINESSecond Edition - April 2011

I. THE NIA IMT POLICY

Pursuant to the NIA Charter and relevant legislations cited in Section III of this document:

IT IS THE POLICY OF THE NATIONAL IRRIGATION ADMINISTRATION TO PURSUEIMPROVED IRRIGATION SYSTEM PERFORMANCE, IRRIGATION SERVICE, ANDATTAIN FINANCIAL SUSTAINABILITY IN THE OPERATION AND MAINTENANCE OFTHE NATIONAL IRRIGATION SYSTEMS (NIS) THROUGH THE TRANSFER OF NISMANAGEMENT, PARTIALLY OR FULLY, TO DULY ORGANIZED IRRIGATORSASSOCIATIONS (IAS).

II. RATIONALE OF THE NIA IMT PROGRAM

What is IMT? IMT Refers to the processes involved in the transfer of the management,operation and maintenance of the national irrigation systems (NIS) to Irrigators Associations(IA), whether wholly or partially, depending on the size of the system and capacity of the IA.

Why transfer management of NIS? The main reason for the IMT Program of the NIA is toattain efficient irrigation service and sustainable operation of the National Irrigation Systems(NIS) through the involvement of Irrigators Associations (IAs) in the management of thesystems. This is done through the transfer of management functions in the operation andmaintenance of NISs from NIA to duly organized IAs.

Specifically, the reasons for transferring the management of NISs from NIA to IA are:

NIA point of view:

a) Implementation of the NIA mandate as prescribed by its charter and other relevantPhilippine Laws;

b) Reduction of Expenses on operation and maintenance (O&M). In many instances theO&M expenses of an NIS exceeds revenue from Irrigation Service Fee (ISF)collections;

c) Improvement of NIS operation performance in terms of timely and equitable waterdelivery and distribution, narrow the gap between irrigated and service area, andincrease ISF collection efficiency; and

d) Improvement of NIS performance needs the joint efforts of NIA and farmers.

IA point of view:

a) Improvement of NIS efficiency and performance as users are directly involved in themanagement of O&M;

b) Improvement and equity in water availability and distribution;c) Opportunity to build-up IA capital;d) Opportunity to develop capacity for organizational and system management; ande) Equitable opportunity for higher agricultural production and income for IA members.

The Challenge of IMT. The main challenges of IMT are: a) “the formation and developmentof the farmers into a functional and self-reliant association of water-users, which is capableand willing to take on the responsibilities of operating and maintaining the NIS; and b)acceptability of the Program to the NIA O&M personnel so that they cooperate and facilitate

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the capacity development of farmers and realign/redefine their functions to provide technicalas well as managerial assistance to IA.”

III. LEGAL BASIS AND EXISTING POLICY ON IMT

The relevant Philippine Laws that provide legal bases to NIA to transfer management of NISto IAs are the following:

RA 3601 of 1963, the NIA Charter, as amended by PD 552 and PD 1701

“Section 2: Powers and Objectives – The NIA shall have the following powers andobjectives:

(a) To investigate and study all available and possible water resources in thePhilippines, primarily for irrigation purposes; to plan, design, construct and/or improveall types of irrigation projects and appurtenant structures, all national irrigation systems;the authority to supervise the operation, maintenance and repair, or otherwiseadminister temporarily all communal and pump irrigation systems constructed,improved and/or repaired wholly or partially with government funds; and delegate thepartial or full management of national irrigation systems to duly-organizedcooperatives or associations, under such terms and conditions which the NIA Board ofDirectors may impose.”

RA 7607 of 1992, the Magna Carta of Small Farmers

“SECTION 20. Access to Irrigation Services. — While the Government, through theNational Irrigation Administration (NIA) and other concerned offices, continues toprovide irrigation services, farmers' organizations shall be encouraged to spearheadthe construction of irrigation systems. Towards this end, the Government shallencourage small farmers to join or form Irrigators Associations. In addition, it shallpromote participation of farmers to develop their capabilities to eventually assume theoperation and maintenance of irrigation systems and the responsibility of collectingfees from the individual members and remitting an amount to the NIA.

The NIA shall undertake the development and institutionalization of second-cropirrigation facilities in support of multi-crop farming. It shall also devise schemes forsmall farmers to avail of electric pumps or diesel-powered deep well irrigation systemsin barangays or communities where water is scarce.”

RA 8435 of 1997, the Agriculture and Fisheries Modernization Act (AFMA)

“SECTION 30. National Irrigation Systems (NIS) — The National IrrigationAdministration (NIA) shall continue to plan, design, develop, rehabilitate and improvethe NISs. It shall continue to maintain and operate the major irrigation structuresincluding the headworks and main canals. In addition, the NIA is mandated togradually turn over operation and maintenance of the National IrrigationSystem's secondary canals and on-farm facilities to Irrigators Associations.”

The following Memorandum Circulars (MC) pronounced the NIA policy and previous IMTguidelines that addressed and guided earlier efforts on Participatory Irrigation Management(PIM). All of these MCs guided the implementation of IMT up to the late 1990s.

MC No. 014, s. 1987 - defines the Criteria in the Shared-Management (Turn-over) ofNIS or part of NIS to IA under Stage I, Stage II and Stage III Contracts.

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MC No. 014, s. 1989 - revised the Criteria in the shared-management (turn-over) ofNIA or part of NIS to IA and changed the contract titles to Type I, Type II and Type III.This effectively separated the maintenance contract (Type I) and the ISF CollectionContract (Type II). Many IAs, however, elected to undertake a combined Type I and IIContracts.

MC No. 41, s. 1990 - increased the IA incentives for Type I contract from P610 toP1,100 for the maintenance of 3.5 km of unlined canal or 7.0 km of lined canal. It alsorevised the IA incentive for Type II contract and reduced the required ISF collectionfrom 70 percent to 50 percent before the IA qualifies for incentives. It also defined theexpanded IA duties on Type I and Type II contracts.

MC No. 6, s. 1991 - required the IA collectors and treasurers with Type II Contracts tobe bonded and a separate cash book for ISF collections be established.

MC No. 35, s. 1993 - increased the IA incentives from P1,100 to P1,400 for Type Icontract.

IV. THE IMT PROGRAM AND ITS OBJECTIVES

The program that implements the IMT policy and guidelines shall be called the “IrrigationManagement Transfer (IMT) Program”. The IMT Program supersedes or encompasses allother programs of NIA relating to the organization and development of IAs, and the transferof O&M responsibilities to IAs in the NISs.

The IMT Program is a set of activities and resources aimed at improving the performance ofNISs through the transfer of management functions in the operation and maintenance ofNISs from NIA to duly organized IAs.

The objectives of the IMT Program are the following:

a. Develop and institutionalize a strong and dynamic partnership between the NIAand the Irrigators Associations for the delivery of efficient irrigation service toirrigated farmers;

b. Duly organized, functional and self-reliant Irrigators Associations (IAs). The IA isregistered with appropriate government entity, and is capable and willing tooperate and maintain the NIS, wholly or partially.

c. Improved performance of the NISs in terms of equitable water distribution, andtimely and reliable water deliveries. Performance indicators are: a) moreequitable water distribution, b) better timely and reliable water deliveries, c)higher cropping intensity, and d) higher ISF collection efficiency.

d. Higher opportunities to farmers of NISs for better and more profitable agriculturalproduction. Farmers are expected to benefit from better irrigation service in termsof higher yields and farm incomes.

e. Sustainability and financial viability of the operation and maintenance of NISs,and consequently the IA and the NIA. Improved NIS performance triggers betteragricultural production and profitability, willingness of farmers to pay ISF, higherISF collection efficiency and more funds for O&M of NIS, therefore, bettermaintenance and sustainable operation of NIS, and sustainable inflow of funds orincome to IAs and the NIA to support the O&M of NISs.

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V. COMPONENTS OF THE IMT PROGRAM

The following five (5) components need to be addressed by the IMT Program.

1. The Irrigators Association Component. The basic entity that shall receive andtake-over the NIA’s management functions in NIS is the Irrigators Association (IA).The IA could be a first level IA that was organized and registered to consolidate thecollective decision-making of a number of turnout service area groups (TSAG) servedby a common supply channel or it could be a second level such as Council of IAs(CIA) or Federation of IAs (FIA) served through a common head gate from a mainsupply channel or in cases of small to medium size systems, the FIA may cover theentire system. In larger schemes, a Confederation of C/FIAs (CC/FIA) is alsoorganized at the headgate of a main supply channel where water supplies for theheadgates of all the CIAs/FIAs are obtained.

The primary concern in this component is the organization and capabilitydevelopment of the IA including officers and members to enable them to carry out themanagement functions transferred to them. The organization of IAs shall beredirected towards the mobilization and development of the turnout service areagroup (TSAG) initially to provide a solid grassroots foundation for democratic orconsultative problem-solving, decision-making and equal (area-wide) representationto facilitate the active participation of all farmers/IA Members. The IAs at variouslevels are organized as pyramid structure along hydraulic boundaries for morecohesive and professional management of NIS in support to higher agriculturalproductivity and farming profitability.

The term Irrigators Associations (IA) shall refer to the various levels of water usersassociations in various NISs that include, but not limited to, the Council of IAs (CIA),Federation of IAs (FIA), Confederation of IAs (CFIA), and Irrigation ServiceCooperatives (ISC). Duly organized association shall mean organized and registeredwith authorized entities of the government and operates in accordance withappropriate laws of the Philippines.

Why develop the IA? The development of the IA aims to “to establish and sustainprofessional management by IA of the following: a) affairs of the association, b)operation and maintenance of the system, c) financial viability of the association, andd) productivity and profitability of farming in the IA area.”

How should IAs be organized? The organizational structure should reflect hydraulicboundaries that are designated by readily identifiable and verifiable irrigationstructures to delineate appropriate key management functions at different levels ofthe NIS. For most NIS, the key management organizations are identified in theillustration below.

CFIA System or District Up to 20,000

FIA Main Canal or Zone 1,000 - 5,000

CIA Lateral or main canal 500 or more

IA Sub-Lateral or Lateral 150 - 300

TSAG On-Farm Facilities 20 - 50

Level of facilities Area in hectares

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Depending on the size of the system, a pyramid-shaped organizational structure isthe pattern of IA organization starting from the turnout service area group (TSAG) asthe basic unit of irrigation water management. The TSAG members have a commoninterest in ensuring equitable water distribution in the area being served by a turnout.The TSAG membership is also suitably sized for small group activities to involve allfarmers in collective decision making.

The Irrigators Association is the federation of TSAGs within the lateral for smallschemes, or within a specific section along the lateral canal for large schemes.Farmer-members of TSAGs compose the general assembly of the IA and TSAGleaders are the IA Board of Trustees or Directors. The IA officers are elected fromthe members of the Board or from the general assembly, depending on theConstitution and By-laws of the IA. The IA is recognized as a juridical entity andregistered with the Securities and Exchange Commission (SEC) or CooperativesDevelopment Authority (CDA).

The Council of IAs (CIA) is organized as federation of IAs at the system level forsmall schemes or at the lateral level for large schemes. The general assembly of theCIA is the TSAG Leaders or the IA officers and BOD. The IA organization goes upthe ladder until the system level federation or confederation of IAs is formed, as thecase may be and depending on the desire and need of the IAs. The CIA and otherhigher organization are also registered so that they qualify to enter into contract withNIA on either IMT or other activities, such as civil works contracts.

Capability Development or Strengthening of IAs. IA capability development orstrengthening shall be focused on four (4) major aspects of capacity build-up – a)Organizational discipline and management; b) System management; c) Financialmanagement; d) Entrepreneurial capability development. This must be done throughthe experiential learning process rather than the usual classroom-lecture type. Theseshall include, but not necessarily limited to the following:

a. Organizational discipline and management. Refers to the conduct of regular IAactivities in accordance with the constitution and by-laws and policies, practice ofcollective decision making, and maintenance of quality and complete records ofIA meetings, transactions, extent of membership and master list of members,approved policies and regulations and enforcement of the same. The IA shouldbe able to give high importance on these essential aspects to sustain theorganization. Through the application of appropriate experiential learningmethods, the following capability development areas may be included in thisaspect considering the actual training or capability development needs of the IAbased on the IA Functionality Survey Results and/or a Training NeedsAssessment. These trainings are applicable for the capability development of IAsin preparation for IMT Contracts.

1) Setting IA Goals, Objectives and Targets2) Integrity Development and Good Governance (Transparency)3) O&M Policy Formulation, Dissemination and Enforcement4) IA Incorporation and By-Laws Dissemination to members5) Basic Leadership Development Course6) Value Formation Seminar7) Record Keeping and Filing System8) Basic Management and Supervision9) Communication and Feedbacking10) Linkages with LGU and Other Institutions/Organizations

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11) Gender in the Operation and Maintenance of Irrigation Systems

b. Irrigation System management. The training module develop by IDD on SystemManagement could be used as introductory material. System-specific on-the-jobtraining (OJT) modules on O&M should be developed for the use of the SeniorWater Resources Facilities Technicians (SWRFT) in coaching the IA. Importanttraining modules that should be considered are:

1) Operation Plan (cropping calendar and pattern; water delivery and distribution;maintenance) Preparation;

2) Irrigation Facilities and Structures: Uses and Operation3) Discharge Measurement and Monitoring;4) LIPA Preparation and Compilation;5) Water Delivery and Distribution; Water Management; Water Saving

Technologies6) Maintenance Requirements of Irrigation, Drainage and Road facilities; and7) Assessment of O&M performance and the Irrigation System through end-

season walk-through to identify repair and maintenance needs8) Water-saving rice production technologies such as the: a) Alternate Wetting

and Drying; b) System for Rice Intensification (SRI); and c) SustainableSystem for Irrigated Agriculture (SSIA)

9) Information Campaign on Effect of Informal Settlers and Garbage Disposal inIrrigation Canals and Embankments on the Operation and Maintenance ofIrrigation Systems (including relevant laws)

10) Adaptation Strategies to Climate Change for Irrigation Systems

The above trainings are applicable for the capability development of IAs inpreparation for any IMT contract with variations considering area coverage of thecontract, i.e., Lateral coverage for Models 1 and 2 contracts, first lateral headgateup to farm level facilities for Model 3 contract, and whole system for Model 4contract.

c. Financial management. NIA has developed a training manual on FinancialManagement System for IAs. It is important that financial activities of IAs arecontinuously monitored and evaluated to ensure that accounting and auditingprocedures are properly adopted and practiced. Regular and spot audit on thebooks of the IA should be sustained by NIA. Financial reports and statements ofthe IA should be reviewed by NIA to formulate suggestions for improvement. IAsthat can afford to hire professional accountants for the preparation of financialreports and statements, even on retainer-fee mode, should be encouraged. Incases where the IA cannot find from its members or officers any potential fordeveloping capabilities on bookkeeping, financial reporting and related skills, theIA should decide to hire IA personnel for this to be paid out of their IA share. It isthe responsibility of the NIA to develop the capabilities of the IA officers,members and/or personnel on financial management to institutionalize thenecessary skills and knowledge within the IA.

Considering the IMT Model Contract an IA is planning to negotiate with NIA, thefollowing modules may be considered for IA capability development on financialmanagement.

Responsibility IMT Contract

1) ISF Bill Preparation Models 2, 3 and 4

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Responsibility IMT Contract

2)Strategies on ISF Bill Distribution andCollection Campaign

Model 1, 2, 3 and 4

3) ISF Collection Strategies Model 2, 3 and 4

4)ISF Collection Recording, Accounting,Remittance and Reporting and Updating ofIrrigation Fee Register

Model 2, 3 and 4

5) Updating of Irrigation Fee Register Model 2, 3 and 4

6) Financial Planning and Budgeting Model 1, 2, 3 and 4

7)Bookkeeping, Accounting, Financial Controland Financial Reporting for IAs

Model 1, 2, 3 and 4

8)Preparation of SEC ReportorialRequirements and related financial reports

Model 1, 2, 3 and 4

d. Entrepreneurial and Other Areas of Capability Development. Besidesirrigation, the IA have to deal with other concerns that can further develop theviability and functionality of their organization. Relevant modules for training are:

1) IA Capital build-up and entrepreneurship2) Linkages with LGU and other government agencies3) Rice-based crop diversification4) Livelihood development programs5) Gender and development (promoting women participation in irrigation)

The above training programs are applicable to any IA with any of the IMTContracts.

2. The NIA Personnel Component. This component addresses the preparation of NIApersonnel at all levels of the organization to enable them to perform their rolesconsidering the IMT Program implementation. The changes on the roles of NIA O&Mpersonnel depend on the stages of IMT implementation and on the transfer modeladopted in the system.

For Transfer Model 1, the NIA role is reduced by the functions usually done by theWater Resources Facilities Tender (WRFT) (formerly Ditchtender) but the duties ofthe Senior Water Resources Facilities Technician (SWRFT) shall now include theusual O&M functions plus technical assistance to IAs as follows:

a) monitoring and evaluation of IA activities particularly its compliance with the IMTContract;

b) on-the-job training on specific O&M activities transferred to the IA;c) assistance to the IA on water-related conflict resolution among TSAGs and

farmers;d) organizational development of the IA.

For Transfer Model 2 and Model 3, the NIA role is reduced by a substantial amountas the functions done by the WRFT and SWRFT are both affected. The task of NIAO&M personnel shifts from the usual O&M activities to developing the IA capacity toperform O&M activities within the area coverage. Thus, NIA responsibility includesthe following:

a) OJT of IA on O&M planning, implementation, and monitoring and evaluation;

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b) Assistance to IA on resolution of water-related conflicts among TSAGs andfarmers;

c) Training IA on financial planning and management;d) Training IA on accounting and auditing of financial transactions;e) Advising and training IA on organizational management and discipline; andf) Provision of technical assistance and guidance to IA.

For Transfer Model 4, NIA completely transfers the O&M functions to the IA. Theremaining roles of NIA are as follows:

a) Monitoring and evaluating the IA performance periodically;b) Collecting a Technical Assistance Fee from the IA; andc) Providing O&M supervision and technical assistance to the IA.

3. The Infrastructure Component. The infrastructure component is the repair andrehabilitation program developed jointly by the NIA and IA to address identifiedphysical deficiencies of the system. It aims to restore the original operating conditionof the physical facilities before the transfer of management to the IA. It is composedof a list of repair and construction activities on specific locations with correspondingcost estimates and time frame. The main objective is to handover to the IA asmoothly running irrigation facility once construction is completed.

Prior to start of construction, it is necessary to thoroughly explain to IAs/farmers thefunctions of each structure especially if there are new ones such as proportionallong-crested weirs, flow measuring devices, and check structures. While these werediscussed and agreed upon during the planning phase, not all farmers wouldcompletely grasp the objectives and functions of each structure. Proper orientationof the farmers on these structures will minimize operational problems caused byfarmers’interference and manipulation.

Implementation of this component is also capitalized to build-up the IA resources forits responsibilities in O&M of the system. NIA shall give priority to the IA ascontracting party or to its members as construction labor on any rehabilitation andimprovement works within the IA area that are programmed to be done by laborintensive methods. Twenty-five percent (25%) shall be deducted by NIA from IAand/or member labor payment for the establishment of an IA Repair andMaintenance or Patubigayan Trust Fund (PTF)1.

4. The Monitoring and Evaluation (M&E) Component. The M&E aims to provide theIA and NIA the needed management tools in assessing achievements on improvingthe system O&M and IA development. Specifically, the M&E seeks to provide NIAwith quantifiable basis in assessing the effectiveness of the IA in the performance ofthe turned over management responsibilities of the NIS specified in the IMT Contract.It also aims to provide the IA the means to evaluate the NIA performance incomplying with its commitments in support to the IM. The M&E is discussed in detailin Section XV of this document.

5. The Linkages and Advocacy Component. The IMT Program needs to be widelydisseminated and fully supported by all NIA personnel, first and foremost, to expect asuccessful implementation of the same. Advocacy activities to other government and

1 A separate NIA Memorandum Circular for the Patubigayan Trust Fund (previously termed as ”IAImprovement Share”during the implementation of WRDP and IOSP II is being prepared and will beissued through the facilitation of the Operations Department (Systems Management Division andInstitutional Development Division).

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non-government organization would be much easier after all NIA personnel believeon the soundness and attainability of the program objectives.

VI. THE IMT PROCESS

The IMT process aims to develop and strengthen the IA to make them capable ofrecognizing their innate capacity and mobilizing their members to take on the challenge ofmanaging the O&M of the NIS, confidently and sincerely, through informed collectivedecision of all members. The process that has five phases looks at the progressivedevelopment of the IA as a group of water users served and linked together by a commonwater source or supply. In like manner, the process also develops the capacity of the NIAO&M personnel to adapt to the new regime of O&M in NIS, and gradually, adjust theiractivities to give way to the stronger presence of IA in O&M and provide the neededtechnical and managerial assistance the IA needs so that it will be able to comply with itscontract obligations. If necessary, NIA Staff will be provided with training to equip them withthe necessary skills, knowledge and attitude to plan, implement, monitor and evaluate theIMT Program within their area of jurisdiction. These activities aim to promote: a) commonunderstanding of the NIA IMT Policy and Program from the NIA Central Office to theIrrigation Systems Offices; b) common ownership of the Program; and c) develop thecapability of the direct implementors of the program.

The process adopted in the implementation of IMT is iterative and cyclical whereinparticipants undertake activities as part of their experiential learning process as in thediagram below.

The transfer learning process is similar to that of the management cycle where implementorsand participants go through the same processes but adopts and improves from lessonslearned in each completed cycle.

There are five phases in the IMT process:

Phase 1: The Preparatory Phase – is the set of preparatory activities that generates dataand information, and decision for IMT action plan setting. This ensures that all key playershave common understanding of: a) the IMT process and requirements; b) the current state ofthe irrigation system; c) IA capacity and functionality; and d) the need for systemimprovement and management transfer to improve irrigation service.

This will include IMT Program information dissemination to IAs and farmers by NIA IMO Staffthrough; a) formal and informal discussions with IAs as well as members/farmers (NIA-IAmeetings, attending IA meetings, IA trainings/workshops, individual contacts, etc.); and b)NIA-IA Workshop on the IMT Program of NIA using the NIA IMT Policy and the IMTImplementation Guideline (Annex 1) as reference material supported by actual data and

New Activity

Application

Monitoring and

Evaluation,

Analysis

Setting Objectives,

Abstraction,

Learning

Planning

Implementation,

Application

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information on: i) current irrigation system performance; ii) IA functionality status; and iii)cases of successful NIA-IA partnership through existing O&M contracts within the regionand/or in other Asian countries.

The objective of this phase is to motivate the IA and the NIA Staff at the system level torecognize: a) the importance and benefits of the IMT program; and b) the need for the IA toassume O&M responsibilities as partners in the O&M of the irrigation system. This activitywill jump-start the IMT process.

Phase 2: The Mobilization Phase –is the set of activities that leads to farmers’awarenessof the situation of the O&M of NIS and the realization of the IA for the need to: a) improvesystem performance, b) strengthen unity among users, c) mobilize farmers to initiate systemimprovement, d) further develop IA capacity for the O&M of the system, and e) organize orre-organize the IA, as the case may be, i.e., by organizing and strengthening its turnoutservice area groups (TSAGs). The mobilization phase establishes the starting environmentfor the succeeding Participatory Planning Phase.

This phase will include: a) conduct of IA membership meetings on IMT; b) the conduct of ajoint NIA-IA walk-through of the irrigation system or IA area, to generate a list of repair,rehabilitation and/or improvement works necessary to be addressed to improve theperformance of the irrigation system or IA area; and c) NIA-IA workshop on assessment ofthe IA performance as an organization and generate a list of issues to be addressed tostrengthen the IA using data and information from the IA Functionality Survey.

The mobilization phase has three major activities – the Situation Analysis (SA), the IA re-organization, and the organization of a higher level IA. The SA is conducted by the IA as anorganization at the TSAG level to examine the O&M performance of their system/IA areaand identify opportunities for improvement. The SA intends to stimulate demand forimproved operation and maintenance, re-organization, reactivation and/or strengthening ofthe IA, and the transfer of irrigation management from NIA to IA.

The re-organization of the IA is required to: a) ensure that the IA is a representativeorganization of all the water users within its hydraulic boundaries; b) potential users inexpansion and recovery areas are included; c) equal water rights of all farmers within the IAservice area is recognized; and d) facilitate collective decision making of all IA members.The organization of higher level IA is necessary if the target IMT area is composed of two ormore duly organized IAs.

The mobilization phase establishes the starting environment for the succeeding ParticipatoryPlanning Phase.

Phase 3: The Participatory Planning Phase –activities in this phase will be based on theresults of the activities in Phase 2. In this phase the NIA-IA partnership and theempowerment of the IA will be further developed. It includes: a) NIA-IA workshop to discussthe results of the joint NIA-IA walk-through of the irrigation system and generate a prioritizedlist of repair, rehabilitation and/or improvement works to be done; and b) NIA-IA planningworkshops to discuss and agree on activities to be done to strengthen the IA and c) NIA-IAAction Planning Workshops to formulate proposals for physical improvement, improvedsystem operation, improved maintenance, IA capacity build-up plan, monitoring andevaluation scheme, and the draft IMT contract. The main objective in the conduct of activitiesin this phase is to provide opportunity to the IA to experience actual involvement in theformulation and preparation of the following:

a. Proposed physical improvement that include arrangements by which the IA canparticipate;

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b. Operation and maintenance plan for the system;c. Plan for the capacity development and capital build-up of the IA;d. Monitoring and evaluation scheme; ande. Draft IMT contract.

This phase coincides with the pre-engineering phase for the physical development of thesystem. The IAs will be involved in the actual survey of the physical works to be done andwill be consulted on the design/plan of the physical development works through the conductof subproject design consultation meetings before the design/plan is finalized. AMemorandum of Understanding (pro-forma attached as Annex 3) between the NIA-IA will beformulated and signed by NIA and IA representatives. The approved subproject design/planor the list of physical works to be done will be an attachment to the MOU.

Phase 4: The Implementation Phase – is the conduct of activities to attain the objectivesdrawn up in the various plans in Phase 3. Inherent components in this phase is the NIA-IAAssessment and Planning meetings to evaluate actual accomplishments against targets andformulate new strategies, policies and plans to improve performance, rectify assumptions,and resolve issues and concerns.

It is during this phase that the physical improvement is undertaken. It is important during thisphase that all new structures planned to improve system operation are fully understood andappreciated by all farmers. Past experience relates that farmers often perceive that somestructures are flow constrictors that make water application to farms more difficult. Theseare often modified or demolished by farmers without prior notice.

IAs, as far as practicable, shall be engaged in the infrastructure rehabilitation andconstruction of NIS under the IMT Program. Civil works contracts and/or employment ofmembers in the infrastructure component shall be the source of establishing the IA Repairand Maintenance or Patubigayan Trust Fund (PTF). Agreements on the participation offarmers in construction and in giving the IA-members priority in labor recruitment should beimplemented with transparency and sincere effort. IA Repair and Maintenance orPatubigayan Trust Fund (PTF) for financing O&M within the IA area of responsibility must beundertaken.

Periodic inventory of physical works followed by NIA-IA Assessment and Planning Meetingto evaluate actual accomplishments against targets, formulate new strategies and policies,adjust assumptions and plans, and resolve issues and concerns shall be conducted.Besides promoting IA empowerment, such activities will enrich the organizationalmanagement capacity of the IA as well as establish a venue for information dissemination ofproject status.

At the end of this phase a Joint NIA-IA inventory of completed physical works is done and adry-run of the improved irrigation system will be conducted. Based on the observations in thedry-run necessary de-bugging works must be listed and implemented.

Once the physical works is accepted by NIA and conformed by the IA, IMT contractnegotiation can proceed, finalization of the IMT Contract and eventually signing of the IMTContract by the NIA and IA designated representatives. The template for the IMT Contractsis attached as Annex 4.

Phase 5: The Monitoring and Evaluation Phase – aims to provide the IA and NIA theneeded management tools in assessing achievements on improving the system O&M and IAdevelopment. Specifically, the M&E seeks to provide NIA with quantifiable basis inassessing the effectiveness of the IA in the performance of the turned over managementresponsibilities of the NIS specified in the IMT Contract. It also aims to provide the IA the

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means to evaluate the NIA performance in complying with its commitments in support to theIMT. The M&E is discussed in more detail in Section XV of this document. Annex 8presents the NIA and IA IMT Performance Evaluation system.

VII. COVERAGE

The IMT Program shall be implemented in all existing National Irrigation Systems (NISs)including those that are under construction.

Existing NIA O&M and/or management contracts will be modified to conform to this IMTPolicy subject to consultation and mutual agreement between NIA and IA, except thoseunder Type III and Stage III Contracts (which cover asset turn-over), unless renegotiated.

VIII. IRRIGATION MANAGEMENT TRANSFER CONTRACTS AND RESPONSIBILITIES

Management functions to be transferred from NIA to the IA. The basic functions on themanagement of irrigations systems are: 1) operations; 2) repair and maintenance; 3) fundmanagement for O&M; 4) enforcement of procedures and resolution of water-relatedconflicts; and 5) agricultural support services. NIA is directly concerned on the first four andthe fifth is done through coordination with relevant government agencies and non-government organizations.

The management functions that will be transferred to the IA are the tasks in items 1), 2), and3) above. Items 4) and 5) are considered inherent functions of the IA in its organizationalmanagement.

1. Operation. Refers to the activities involved in diverting water from the source andconveying and distributing this to the point of application in the farmers’fields. Theprincipal tasks include:

a. Preparation and monitoring of cropping calendar and planting pattern;b. Preparation and submission of List of Irrigated and Planted Areas (LIPA);c. Measurement and monitoring of water requirements and available supply;d. Conveyance and distribution of available water to headgates of lateral canals;e. Distribution of water to turnout inlets;f. Application of water to farm plots; andg. Removal/drainage of excess water from fields.

Tasks e and f are inherent functions of individual farmers. All of the other tasks shallbe transferred to the IA depending on the infrastructures involved and the transfermodel adopted. For Model 1, for example, very specific activities in a, b, and c aretransferred on limited sections of the system. For Model 2 and Model 3, all tasks aretransferred to the IA based on the infrastructures covered within the IA jurisdiction.

2. Repair and Maintenance. Refers to the activities undertaken related to keeping theirrigation system in good operating condition at all times within the limitations ofavailable resources to attain maximum use and economic life of the irrigation anddrainage facilities. The principal tasks are:

a. Routine maintenance that include removal of silt at flow measuring devices,clearing of floating debris accumulated at the crests of proportioning and duckbillweirs and inlet of structures, remedial repairs to minimize leakage from controlgates and check structures, remedial measures to prevent overtopping of canalembankments, greasing or oiling of gates; and

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b. Periodic repair and maintenance that include desilting, cutting of vegetation oncanal embankments, and reshaping and cleaning canal prism.

All routine and periodic repair and maintenance tasks are transferred to the IA accordingto the adopted transfer Model except desilting work. Desilting is a major maintenancecost in many NIS, hence, it is very difficult for small and “just starting”IAs to undertake.Therefore, this shall be treated in the following manner.

Desilting of canals, where this could be done manually, shall be the responsibility of theIA. Where the operation could only be done with the use of heavy equipment, this shallbe the joint responsibility of the IA and NIA. These sections should be specificallydefined in the IMT contract by citing the canal name and stationing. Such sections areagreed upon after the joint walk-through survey of the IA and NIA.

Desilting done through the joint effort of the IA and NIA is implemented as follows:

a. Where NIA has suitable equipment, the Manager of the Irrigation ManagementOffice (IMO) deploys the equipment for desilting work and the IA contributes byproviding fuel and oil.

b. In instances where the IA deploys its own equipment or obtains equipmentassistance from LGU for desilting canal sections identified and delineated as jointresponsibility of the IA and NIA, the fuel and oil cost shall be borne by the NIA.

3. Financial management. This includes the following tasks:

a. Preparation of ISF bills for individual farmers;b. Distribution of ISF bills and campaign for payment:c. Collection of ISF payments;d. Safeguarding and remitting ISF collections;e. Maintenance of irrigation fee registers (IFR);f. Budgeting, budget implementation and monitoring;g. Imposition of discipline and sanctions on settlement of members’obligations; andh. Procurement and disbursement control.

Items f, g, and h are inherent functions of the IA in its organizational management. NIAprovides appropriate training to the IA on these aspects as part of the capacity build-upand strengthening program for the IA.

All tasks “a”to “e”are transferred to the IA according to the adopted transfer Model.For Model 1, only task “b”is transferred but for Model 2, Model 3, and Model 4, alltasks are transferred.

The IMT Model Contracts. The transfer of management of NIS from NIA to IA shall be inthe following Model Contracts. The existing O&M contracts shall be reviewed in accordancewith this guideline and shall be modified or revoked, if necessary. The IA or the NIA mayinitiate the renegotiation of existing O&M contracts into any of the IMT contract models.

IMTContract


Model 1

Manages the entire systembut transfers specificoperation and maintenanceresponsibilities to the IA

a) Maintenance of canals (portion of maincanals, laterals and other irrigation facilitiesand structures within the coverage of the IAservice area); b) operation activities such asdischarge monitoring and preparation of list ofirrigated and planted area; and c) distribution

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IMTContract


of irrigation service fee (ISF) bills andcampaign for payment.

Depending on the capacity and willingness ofthe IA, ISF collection can be an addedresponsibility of the IA especially in NISs thathave very limited NIA Staff under the NIArationalized structure.

Model 2Manages the main system,from the headworks to thehead gates of lateral canals

Management and/or Operation andMaintenance (O&M) of the laterals, sub-laterals, and terminal facilities.

Model 3

Manages the headworks andportion of main canal up tothe junction of the first lateralcanal headgate

Management and/or Operation andMaintenance (O&M) of the rest of the systemfrom the junction of the first lateral canalheadgate down to the farm level facilities. Thisis an expanded form of Model 2.

Model 4Monitoring, evaluation andprovision of technicalassistance to the IA

Full management and/or Operation andMaintenance (O&M) of the entire systemincluding the headworks

The preparation of ISF bills is considered for turn-over to the IA in Models 2, 3 and 4contracts. However, since ISF bill preparation is computerized, unless the IA procure theirown computer and have trained personnel to do the job, this responsibility cannot be turned-over to the IA. Hence, when the IA lacks the equipment and manpower to do ISF billpreparation, this shall be done by the NIA but the cost for such shall be considered as part ofthe NIA Cost in the determination of the O&M Cost “break-even point”and the NIA-IA ISFcollection share for Models 2 and 3. For Model 4, the cost of doing this shall be determinedand agreed by the NIA and the IA and shall be paid by the IA along with the IrrigationSystem Rental Fee. This shall be discussed and agreed during the NIA-IA IMT Contractnegotiation. The responsibility will be turned-over to the IA once they attain the capability toperform the job and at that time the IA and NIA ISF collection share will be re-negotiated.

The IMT Contract Template is shown in Annex 4. The general obligations of the NIA and theIA are presented and discussed in items “C – General Obligations of the NIA” and “D –General Obligations” of Annex 4 and the specific NIA and IA responsibilities for eachcontract in Annex 5. The guideline for determining the IA compensation and NIA-IA ISFcollection sharing schemes for the different IMT Contracts are discussed in Annexes 6 and7.

Other Transfer Options. The NIA shall consider, on a case to case basis, other emergingpossibilities on IMT. Such options may include tripartite agreement among NIA, IA and LGU;and/or long-term lease contract; or management by competent third parties. These optionsare subject to the recommendation of the Deputy Administrator for Engineering andOperations and approval of the Administrator or the Board of Directors.

Contract Negotiation. To be eligible to negotiate for any IMT Contract, the IA must pass theIA IMT Contract Eligibility Criteria specified in Annex 8. The negotiation considers thewillingness and capability of the IA to undertake O&M responsibilities. The major points fordiscussion during the contract negotiation are the: a) NIA and IA responsibilities in the IMTContract; and b) compensation, payment schedule and payment criteria. The IMT Contract

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negotiation must be carried out in an open and transparent manner. The template for theIMT Contract is presented in Annex 4.

The development of the capability of the IA to perform IMT Contract responsibilities is thefunction of the NIA. The capability development interventions that will be provided by the NIAto the IA must be based on an objective IA training needs evaluation and the list ofresponsibilities under the IMT contract targeted to be negotiated with the IA as discussed initem 1, Section V of Annex 2.

IX. COMPENSATION, PAYMENT SCHEDULE AND PAYMENT CRITERIA

The details of the IMT compensation, payment schedule and payment criteria are presentedin Annex 1.

Compensation. It is the policy of the NIA that the IA shall be compensated for performingirrigation system management functions and/or O&M responsibilities transferred by the NIAto the IA in such a manner that the interest and viability of both the IA and the NIA isconsidered.

The remunerations for canal maintenance and/or share of the IA from ISF collections shallbe subject to negotiation with the NIA based on the concept of “fair sharing of responsibilitiesand benefits”. In the concept of “fair share of responsibilities and benefits”,“responsibilities”means the O&M responsibilities each party performs within the irrigationservice area being considered for IMT; and “benefits” shall be interpreted as theremuneration and/or fair share of each party on the ISF collection within the area beingconsidered for IMT.

For pump systems, all ISF collections shall first be allocated for payment of 50% of theenergy cost. The balance of 50% of the energy cost will be subsidized by NIA inconsideration of the reduced ISF rates for pumps as specified in MC No. 41 s. 2007. Sharingof ISF collections in excess of 50% of the energy cost, shall be negotiated by the IA andthe NIA based on the concept of “fair sharing of responsibilities and benefits”similarto that of Gravity Systems.

The guideline for determining the IA compensation and IA Share on collection of ISF Currentand Back Accounts for the different Model Contracts is presented in Annex 6 and 7.

Payment Schedule. Payment of IA remuneration for canal maintenance must be done bythe NIA within one (1) month after inspection by authorized NIA staff and the NIS Federationand submission of a report (Table 3) that the work done is satisfactory and eligible forpayment.

Payment of IA ISF collection shares (for all Contracts) shall be done within one month fromthe end of the collection period after an open and transparent NIA-IA reconciliation of thetotal ISF collections, remittances and collection efficiencies within the IA service area. (Referto Annex 1).

Payment Criteria. The criteria for paying IA remuneration on canal maintenance for Model 1and IA ISF collection share for any of the IMT Contracts are presented in Annex 1. Itpresents in general, the basis of payment on IA remuneration for canal maintenance and IAISF collection share. It includes penalties in case of delayed payments to IA in the case ofNIA and failure to remit in full the NIA ISF collection share for Models 2 and 3 Contracts, andfailure to pay Irrigation System Rental Fee for Model 4 contract.

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The process, deadlines and sanctions on payment and remittances of ISF Collections eitherfor Current or Back Account Collections shall be subject to existing accounting and auditingrules and regulations and are not part of this document. However, such shall be informed orproperly disseminated by the NIA to the IA for their compliance.

X. DISPUTE/GRIEVANCE RESOLUTION

The NIA through the Head Staff at the NIS level and the IA concerned shall make everyeffort to resolve amicably any dispute/grievance arising out of the IMT Contract. When adispute/grievance is not amicably resolved by the contracting parties, the following processis recommended.

1. The System Management Committee (SMC), is the first level of responsibility forresolving dispute/grievance at the system level. The SMC as specified in MC 36 s.1997 is composed of concerned NIA Staff and IA/FIA Presidents. In the SMC therepresentation of relevant government agencies. LGUs and other institutions are oncall basis or as need arises.

2. Any conflict that is not settled by the SMC will be elevated to the Manager of theIrrigation Management Office (IMO) who will try to resolve such in coordination withthe President and Board of Trustees of the Provincial Federation of IAs andconcerned IMO Staff. If necessary, the mediation of the Provincial/MunicipalGovernment may be sought for the resolution of the dispute/grievance.

3. If the dispute/grievance is not resolved at the IMO level, such shall be elevated orendorsed to the Regional Irrigation Manager who will coordinate with the Presidentand Board of Trustees of the Regional Federation of IAs in resolving thedispute/grievance.

4. In any case that the NIA and IA/FIA concerned: 1) does not agree to submit to theabove process; 2) do not arrive on a mutually agreed solution; or 3) thedispute/grievance is not resolved through the above process, such shall be submittedto any court of law that has jurisdiction thereof or as indicated in the Section onSettlement of Disputes of the NIA-IA IMT Contract.

XI. CONTRACT SUSPENSION

Contract suspension may be resorted to only when: a) the delivery of irrigation service tofarmers; and b) the viability of operating and maintaining the irrigation system are negativelyaffected, as in the following cases:

1. Unresolved dispute/grievance resulting to disruption of the IMT contract arrangement

In such case, the NIA through the IMO under the direction and supervision of the RIOshall temporarily suspend the IMT Contract and shall take-over the management ofirrigation operation and maintenance of the area covered by the IMT contract. Duringthe IMT contract suspension, the NIA shall have the option to hire “contract ofservices”to complement its manpower in the management of the area covered bythe contract. Resumption of the IMT Contract can be negotiated through the mutualagreement of the NIA IMO and the IA concerned. The Contract resumption has to besupported by a notarized NIA-IA Joint Resolution to such effect.

2. Poor NIA or IA IMT Performance affecting irrigation service and financial viability ofthe system

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The IMT Performance Evaluation of the NIA and the IA is evaluated by the proceduredescribe in Annex 9. This provides a system of monitoring and evaluating theperformance of each party of their IMT Contract responsibilities. When the IMTperformance rating of any or both parties is “Satisfactory” or lower, a NIA-IAconsultation meeting with the participation of all members of the NIS SystemManagement Committee (SMC) particularly the Local Government Unit (LGU)representative shall be conducted to discuss actions to be done to correctperformance gaps. The NIA and the IA must support each other and work together tocorrect any problem on the performance of their IMT contract responsibilities in orderto sustain efficient irrigation service to irrigated farmers and financial viability on theO&M of the irrigation system.

However, in extreme cases where: a) the performance of any of the parties fails toimprove or is equivalent to an adjective rating of “Fair” or lower for two (2)consecutive cropping seasons despite corrective efforts exerted; and b) when theperformance of a party is negatively affecting the delivery of irrigation services toirrigated farmers and the financial viability of operating the IMT covered area and theirrigation system, any of the party can decide to write the other party for thesuspension of the IMT contract within one month notice.

In case the IA decides to write the suspension letter, this must be addressed to theManager of the Irrigation Management Office, copy furnished the SMC members,Regional Irrigation Manager and the Deputy Administrator for Engineering andOperations at NIA Central Office. In case the NIA decides to write the letter, this mustbe addressed to the IA President, copy furnished the SMC members, RegionalIrrigation Manager and the Deputy Administrator for Engineering and Operations atNIA Central Office. The IMT contract is deemed suspended upon receipt of the letterof suspension by the party concerned.

In any case of contract suspension, the RIO must conduct an investigation incooperation with the SMC and the Provincial and/or Regional Federation of IAs(whichever is appropriate) and submit a report with their recommendation to the NIAAdministrator within one (1) month from Contract suspension.

When the IMT Contract is suspended (as in Case 1 above) the NIA through the IMOunder the direction and supervision of the RIO shall take-over the management ofirrigation operation and maintenance of the area covered by the IMT contract and theNIA shall have the option to hire “contract of services”to complement its manpowerin the management of the area covered by the contract.

Re-negotiation of a suspended IMT contract must be done through mutualagreement of the NIA IMO and the IA subject to the fulfillment of failed obligations ofone or both parties and the resolution of other issues that caused the contractsuspension.

XII. MONITORING AND EVALUATION (M&E)

The M&E provides the IA and NIA the needed management tools in assessing achievementson improving the system O&M and IA development. Specifically, the M&E seeks to provideNIA with quantifiable basis in assessing the effectiveness of the IA in the performance of theturned over management responsibilities of the NIS specified in the IMT Contract. It alsoaims to provide the IA the means to evaluate the NIA performance in complying with itscommitments in support to the IMT.

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There are two major components in the monitoring and evaluation (M&E) system for theimplementation of the IMT Program, namely: a) NIA IMT Performance Evaluation; and b) theIA IMT Performance Evaluation. The evaluation guideline is presented in Annex 8.

The NIA Performance is assessed on Indicators related to: 1) assistance for the organizationand capability development of the IAs for performing their responsibilities under IMT; 2)operation, specifically the implementation of water delivery schedules based on O&M plan;and 3) repair, improvement and/or rehabilitation of the physical facilities (irrigation, drainageand roads). The indicators are basically lifted out from the various plans developed in Phase3 (Participatory Planning Phase) of the IMT implementation Process.

The eligibility of an IA to negotiate for an IMT Contract is determined based on the IA IMTEligibility Criteria in Annex 8. After successfully negotiating and signing an IMT Contract, theseasonal IA IMT Performance is evaluated through the IA IMT Performance Evaluation, alsodiscussed in Annex 8, which evaluates the IA performance on their responsibilities asspecified in their IMT Contract.

The IA IMT Performance Evaluation will be done by the NIA but such shall be presented andreviewed by the SMC. Any IA that signed an IMT Contract will be evaluated using the IA IMTAssessment at the end of every season on indicators of performance of their responsibilitiesin the IMT Contract and performance on organizational management, O&M and financialmanagement following Annex 8. The IA IMT Performance Evaluation is different from the IAFunctionality Survey2 which is conducted annually on three (3) major groups of indicatorsnamely: a) Operation and Maintenance; b) Organizational Management; and c) FinancialManagement.

XIII. IA O&M SEED FUND

For new IAs or IAs which are not yet financially capable of financing their O&M cost, the NIAshall provide IA O&M Seed Fund equivalent to the IA O&M Cost Requirement for onecropping season or as agreed by both parties. The IA O&M Seed Fund shall be paid in fullwithout interest by the IA upon receiving its incentives/ISF Share for the same season theseed fund was granted. The IA O&M Seed Fund can be provided from initial ISF collectionssubject to negotiation and agreement by both parties. An agreement to this effect must bemade by the NIA and the IA during contract negotiation and included as a provision of theIMT Contract.

XIV. ALLOCATION OF IA INCOME FROM IMT

It is the policy of NIA to ensure the sustainability of the NIS whose management has beentransferred to the IA. In order to attain this, the disposition of the IA yearly income must bebalanced for the various operations expenses. It is also appropriate, as part of goodfinancial management practices, to recommend expenditure ratios of various items aspercent of total expenses or as percent of total income or as percent of the ISF share of theIA. This must be discussed between the NIA and the IA during the contract negotiation andthe agreed allocation made part of the final IMT Contract. The yearly budget andexpenditures of the IA is recommended at 40 percent for personal services and 60 percentfor maintenance as follows:

ParticularAllocation as % ofIA Compensation

I. Personnel Services 40

2 The IA Functionality Survey has to be revised to consider changes on the IA responsibilities in thenew IMT Model Contracts

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II. Maintenance and Other Operating Expenses (MOOE) 60

1. Repair and Maintenance of Irrigation Facilities 15

2. Repair and Maintenance of Equipment 5

3. Collection Expenses 10

4. Office Operation and Maintenance 14

5. Repair and Maintenance or Patubigayan Trust Fund 6

6. Miscellaneous 5

7. Net Income for Capital Build-Up 5

Total 100

Repair and maintenance (R&M) of irrigation facilities –covers budget for expenses on canalclearing, canal repair and maintenance, water monitoring, fuel and oil and other relatedactivities on the upkeep of irrigation facilities and structures under the responsibility of theIA.

Repair and maintenance of equipment – includes budget for spare parts, equipment repairand maintenance and labor for mechanic.

Collection expenses – include IA collection expenses, collection incentives, loss on sale ofpalay, loss due to shrinkage and hauling and drying fee.

Office operation and maintenance– includes office supplies, traveling expenses and perdiem, cost incurred during BOD/General Assembly meetings, trainings and seminars, sharesof TSAGs/member IAs/FIA from ISF collection incentives, fuel and oil, light and power, officeimprovement, interest expense, withholding tax, and vehicle registration.

IA Repair and Maintenance or Patubigayan Trust Fund - a yearly allocation for repair andmaintenance trust fund, mostly taken out from the net income, is also included to ensureavailability of fund for special or emergency repairs. The yearly sum is accumulated if it isnot spent on the corresponding year in order to ensure that the repair and maintenance fundwill grow and be available for any major repairs in the future.

The allocation shall be subject for review on a yearly basis by the Board of Trustees of the IA.Funds may be realigned from one expense item to another depending upon the needs.However, expenses for personal services shall be limited to 40% of ISF share. Theallocations may be augmented from funds allocated out of the IA Repair and Maintenance orPatubigayan Trust Fund (PTF) and other sources, if any.

Miscellaneous expenses –all other expenses not included above.

Net Income for Capital Build-Up – the remaining percentage of the total budget will beearmarked for IA Capital Build-Up which could be used for other income generating activitiesor assistance to members through credit with the approval of the IA Board of Trustees.

XV. FINANCING OF THE IMT PROGRAM

The IMT Program shall be funded through on-going projects for new NIS under constructionand existing NIS under rehabilitation and modernization. The Project InstitutionalDevelopment Division (IDD) and the Regional Engineering and Operations Division (EOD)shall align all their institutional development programs to be consistent with this IMT policy.The Project Manager and the Regional Irrigation Manager shall make sure that the IMTProgram is properly funded and supported.

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The existing NISs that are not covered under any on-going and proposed Projects shallpursue the IMT Program through the yearly allocation for NIS Repair and RehabilitationFund appropriated to the NIA through the General Appropriations Act. The DeputyAdministrator of the Engineering and Operations Sector shall ensure that the NIS Repair andRehabilitation Fund fully support the components of the IMT Program.

As a general rule, five (5) percent of the allocation for civil works in all local and foreignfunded projects must be allotted to support the IMT Program for the system or project (new)under repair, rehabilitation or construction. The budget, however, must be firmed-up throughthe preparation of an IMT Program of Work (POW). Copy of the POW must be submitted tothe Deputy Administrator for Engineering for review and consolidation by the OperationsDepartment.

XVI. INSTITUTIONAL ARRANGEMENT

The Irrigation Management Transfer (IMT) Program is the program of the National IrrigationAdministration and every single unit of the agency has inherent functions and responsibilityto perform in supporting its implementation.

Within the NIA Rationalized Structure, the Administrator through the Office of theDeputy Administrator of the Engineering and Operations Sector shall be responsible forthe overall management of the NIA IMT Program. This Office shall facilitate the formulationand issuance of policies, guidelines, directions and fund allocation for the implementation ofthe IMT Program subject to the approval of the Administrator and/or the NIA Board ofDirectors. It is also responsible for the monitoring and evaluation to determine theeffectiveness of the Program The Operations Department (OD) through its SystemsManagement Division (SMD) and Institutional Development Division (IDD) shall take thelead in the implementation of the IMT Program: a) disseminate the IMT policies andguidelines; b) provide training to institutional development (ID) and relevant O&M staff at theRIO and IMO to prepare them to implement the IMT Program; c) assist the RegionalEngineering and Operation Division (EOD) in preparing work and financial programs; d)assist the EOD in training institutional and O&M staff at the IMO and system levels; e)monitor and evaluate the implementation of the IMT Program; f) conduct assessmentsurveys as necessary; and g) assist the RIO and IMO in solving problems that affect the IMTProgram implementation.

The Regional Irrigation Manager through the Regional Engineering and OperationsDivision (EOD) shall take the lead in managing the IMT Program at the regional level andshall assist all IMOs within the region.

At the Irrigation Management Office (IMO) level, the Division Manager through the O&MSection shall take the lead in managing the implementation of the Program for each NISwithin the IMO coverage.

At the system level, the most Senior Staff or Staff designated as head of the System throughthe Senior Irrigators Development Officers (SIDOs) and/or Irrigators DevelopmentOfficers (IDOs), and/or Senior Water Resources Facilities Technicians (SWRFT) are theimplementers of the IMT Program.

As they stay in the field most of the time, the SWRFTs assigned at the system level are thedirect link of NIA to the IA and farmers. They are expected to work closely with the IAofficers, members and other farmers on a daily basis. They are expected to be the key NIApersonnel who will observe and monitor the performance of the IAs, anticipate and/or identifyproblems, help the IA solve problems and assist them understand and practice prescribed

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procedures in O&M. Problems, issues, or concerns that are not resolved at the system levelshould be elevated to the SIDO/IDO at the IMO, then to the Head of the IrrigationManagement Office (IMO) if the SIDO/IDO cannot solve these and so on up themanagement ladder. The scope of work of the SWRFTs at the system level on theimplementation of the IMT Program, therefore, is redefined to include the increasingimportance of assisting, monitoring and evaluating the IA in its functions and the NIA’sdiminishing scope of direct operation and maintenance work.

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MEMORANDUM OF UNDERSTANDINGBY AND BETWEEN

THE NATIONAL IRRIGATION ADMINISTRATIONAND

_________________________________________________________, Inc.

KNOW ALL MEN BY THESE PRESENTS:

This understanding executed and entered into this _____ day of ___________, 200__in __________________________________________ by:

The NATIONAL IRRIGATION ADMINISTRATION, a government-owned and controlledcorporation created under Republic Act No. 3601 as amended by Presidential Decree No.552 with principal office at Epifanio delos Santos Avenue, Quezon City, herein after referredto as NIA;

and

The ______________________________________, an organization of irrigatedfarmers, registered in accordance with the laws of the Philippines with SEC Registration No.__________ and principal office at _________________________________________,represented by its President, ___________________________________, hereinafterreferred to as the ASSOCIATION.

The Parties hereto witness that:

WHEREAS, under the NIA charter and as reiterated under the Agriculture andFisheries Modernization Act or RA No. 8435, NIA is Mandated to transfer the operation andmaintenance (O&M) of lateral canals and all farm level facilities within this canal, in allNational Irrigation Systems (NISs) to capable Irrigators Associations;

WHEREAS, under the ______________________ Project the irrigation facilities andstructures will be rehabilitated to make the system functional, as a requirement of IMT;

WHEREAS, both parties agree that the system rehabilitation will be planned,implemented and monitored with the participation of the Association;

WHEREAS, both parties agree to jointly test the completed works if these passperformance standards before the negotiation of IMT contracts;

WHEREAS, the IA and its members agree to contribute 25% of wages from laborparticipation of IA members hired for rehabilitation works or from value of “Pakyaw Contract”awarded to IAs for the establishment of a IA “Patubigayan Trust Fund”or “O&M Trust Fundas source of funds for the O&M activities within the IA irrigation service area;

NOW THEREFORE, for and in consideration of the foregoing premises, thePARTIES bind themselves to the hereunder arrangements;

A. Obligations of NIA

1. The NIA shall prepare a Program of Work (POW) for the irrigation systemrehabilitation based on the joint NIA-IA Irrigation System Walk Through conductedon __________________ and on the agreed work priorities with the IA during theRehabilitation Works Prioritization Conference conducted on___________________ at the __________________________.

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2. Based on the approved POW, the NIA in consultation with the IA prepare amanpower requirement schedule as basis of the IA in mobilizing its members forlabor and in monitoring the “Patubigayan Trust Fund”or “O&M Trust Fund”. Thisshould be attached as Annex A and form part of this MOU.

3. The NIA shall bear the cost of investigation and survey, plan preparation and otherpre-construction engineering activities for the system rehabilitation.

4. The NIA shall likewise finance the cost of the irrigation systemrehabilitation/restoration.

5. The NIA shall facilitate the conduct of a monthly joint NIA-IA inspection ofrehabilitation works.

6. The NIA shall facilitate the conduct of a monthly joint NIA-IA System RehabilitationCoordination Conference to discuss the progress of the rehabilitation and relatedproblems/issues.

7. The NIA shall facilitate the conduct of inventory and test-run of the rehabilitatedirrigation facilities and structures with the participation of the IA and prepare areport to be signed by NIA (through the Irrigation Superintendent) and the IA(through its President) witnessed by the RIO/CO representatives who participatedin the activity. If there are items of work to be corrected, these shall be listed in thereport and these shall be corrected by NIA through IA participation and anotherinventory and test-run shall be done after. This process will be repeated until boththe NIA and the IA agree that the rehabilitation works are done according to theagreed POW of rehabilitation.

8. The NIA shall provide technical assistance on the organization/re-organization andstrengthening or capability development of the IA to develop their capability (IAtrainings) in performing their responsibilities in the IMT contract as well as managetheir organization.

9. The NIA will provide opportunity for the involvement of women in all activitiesduring project implementation as well as during the O&M phase.

10. The NIA shall provide the IA with necessary documents for O&M of the IA area(copies of Irrigation Fee Register (IFRs) of farmers, parcellary map, master list offarmers, forms for list of irrigated and planted areas, other O&M report forms) uponsigning of the IMT Contract.

B. Obligations of the Association

1. The Association through its IA President will sign (conform) the POW prepared byNIA as a result of the Rehabilitation Design/Plan Consultation Conference.

2. The Association shall provide 100% labor requirement in the repair of facilities andstructures located within the tertiary system (main farm ditch to the farms).

3. The Association and its members must contribute 25% of wages from laborparticipation of IA members hired for rehabilitation works or from value of “PakyawContract”awarded to IAs for the establishment of the IA “Patubigayan Trust Fund”or “O&M Trust Fund”.

4. The Association shall follow the manpower requirement schedule prepared by NIAin mobilizing its members for labor participation.

5. The Association shall participate in the conduct of a monthly joint NIA-IAinspection of rehabilitation works.

6. The Association shall participate in a monthly joint NIA-IA System RehabilitationCoordination Conference to discuss the progress of the rehabilitation and relatedproblems/issues with NIA.

7. The Association shall participate in the conduct of inventory and test-run of therehabilitated irrigation facilities and structures with the participation of the IA andcountersign the System Inventory and Test-Run Report. If there are items of workto be corrected, the IA shall see to it that these are listed in the report. (These shallbe corrected by NIA through IA participation and another inventory and test-run

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shall be done after. This process will be repeated until both the NIA and the IAagree that the rehabilitation works are done according to the agreed POW ofrehabilitation).

8. The Association shall enter into IMT Contracts with NIA after the completion of thecivil works.

9. The Association shall identify officers and members who will attend IA trainingsand study tours aimed at developing their capability to manage their organizationand perform their O&M responsibilities in the IMT Contract.

10. The Association shall make available its Book of Accounts for use by NIA in theconduct of IA financial audit.

C. Special Provisions

1. Both parties have equal access in the monitoring of costs and progress of civilworks for the systems improvement in a manner mutually agreed by the parties.

2. The Association shall submit itself to NIA supervision as a safeguard that theprovisions of this MOU shall be faithfully observed and that the interest ofmembers is protected.

3. The NIA and the IA shall firm-up the irrigated area of the system after thecompletion of the rehabilitation works.

4. The NIA and the IA shall negotiate the type of IMT contract that the IA can enterinto and discuss and agree on the contract provisions.

5. The NIA and the IA shall establish the System Management Committee (SMC) inconsonance with NIA MC No. 36, Series of 1997 and No. 08, series of 2002 as thepolicy-making, planning and monitoring body for the O&M of the irrigation system.Members of the SMC must include line Local Government Units (LGUs),government line agencies and non-government organizations providing support ortechnical assistance on irrigated agriculture.

IN WITNESS HEREOF, the PARTIES to this UNDERSTANDING have hereunto signedthis instrument this ________ day of ______________, 200__

For and in behalf of the IA: For and in behalf of the NIA:

________________________ _________________________________IA President Manager, Irrigation Management Office

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IRRIGATION MANAGEMENT TRANSFER CONTRACT

BY AND BETWEEN

THE NATIONAL IRRIGATION ADMINISTRATION

AND

THE (name of IA)

KNOW ALL PERSONS BY THESE PRESENTS:

This CONTRACT, executed and entered into this ___ day of (month and year), at(municipality and province) by:

The NATIONAL IRRIGATION ADMINISTRATION, a government corporation withprincipal office at NIA Building, Epifanio delos Santos Avenue (EDSA), Diliman, Quezon City,and represented herein by (name of representative), who is authorized in his capacity as( position of representative) of the (name of NIS), with office at (office address) andhereinafter referred to as the NIA;

and

The (name of IA), a water-users association duly organized and registered inaccordance with the laws of the Philippines with principal office at (office address of the IA),and represented herein by (name of representative), who is authorized in his capacity as(position of representative) of the association and hereinafter referred to as the IA.

WITNESSETH THAT:

WHEREAS, the IA signifies its desire, willingness and readiness to manage, operateand maintain the (name of canal and/or NIS being transferred);

WHEREAS, the IA has demonstrated its total cooperation and persistent enthusiasmby attending all activities in preparing the IA officers and members in their new and biggerroles in system operation and maintenance (O&M) under the Irrigation ManagementTransfer (IMT) Program;

WHEREAS, the NIA, pursuant to its Charter and other relevant laws of the Philippines,and in accordance with its objective of improving O&M performance and sustainability ofnational irrigation systems (NIS), is promoting the delegation of the full or partialmanagement of NIS to IAs;

WHEREAS, the NIA is willing to transfer the management, operation and maintenanceof the (name of canal and/or NIS being transferred) to the IA under its IMT Program;;

WHEREAS, the IA has undergone and passed all the preparatory organization, training,participatory planning and consultations, and functionality assessment survey as establishedand required under the IMT Program;

WHEREAS, both parties believe that the IMT Program will benefit the NIA, the IA andthe farmers in terms of better irrigation service, improved agricultural production opportunityto all farmers, and equitable sharing of burden and benefits in O&M of irrigation facilities;

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NOW, THEREFORE, for and in consideration of the foregoing premises and the mutualcovenants hereinafter set forth, the NIA and the IA agree as follows:

A. DEFINITION OF TERMS

The definition of important terms as contained in this contract is presented inAttachment 1 and specifically made an integral part of this Contract.

B. THE TRANSFER MODEL IN THIS CONTRACT

The irrigation management transfer model applied in this Contract is Model [insertmodel number]1, which is described as [derive description from IMT Policy page 4 orfrom first paragraphs of Annex 5 (Model 1), Annex 5 (Model 2), Annex 5 (Model 3) andAnnex 5 (Model 4)]1.

C. GENERAL OBLIGATIONS OF THE NIA

The NIA shall have the following general obligations in this Contract:

1. Plan, implement and monitor its activities related to (a) Operations, (b)Maintenance and Repair; (c) Management of Fund for operation andmaintenance (O&M).

2. Provide capability development program such as on-the-job training to the IA ona) irrigation system management and operation and maintenance; b)organizational management; and financial management

3. Assist the IA in formulating policies and procedures in the performance of itsobligations under this Contract.

4. Undertake the monitoring and evaluation of the performance of the IA relative tothis Contract.

5. Provide technical assistance to the IA particularly in the preparation of O&M planand budget.

6. Monitor and provide technical assistance to the IA in the implementation of theirO&M plan and budget.

7. Provide technical assistance and support to the IA for the promotion of “QuickTurn-Around”and “Ratoon”crop in between the Wet and Dry Seasons, to helpthe government in its program of increasing rice production and attaining ricesufficiency

D. GENERAL OBLIGATIONS OF THE IA

The IA shall have the following general obligations in this Contract:

1. Plan, implement and monitor its activities related to (a) Operations, (b)Maintenance and Repair; (c) Management of Fund for O&M in its area ofjurisdiction.

1Items in bracket are instructions and should be deleted in the final contract

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2. Prepare an annual O&M budget, allocating at least 60 percent to maintenanceand other operating expenditures and, at most, 40 percent to personal services.

3. Establish a “Repair and Maintenance Trust Fund”that will get a yearly budgetallocation equivalent to at least six percent (6%) of the yearly income of the IA.Unused amount in the fund shall accumulate and shall be reserved for any majorrepairs of irrigation facilities in the future.

4. Formulate policies and procedures in the performance of its obligations under thisContract based on fair and equitable sharing of burdens, efforts and benefits atvarious levels of the organization, i.e., farmer-members, turnout service areagroup (TSAG), IA, and Federation or Council of IAs.

5. Allow NIA access to the records, books of accounts, and other documents of theIA relative to the O&M of the subject irrigation facilities.

6. Assist the NIA in promoting the program of increasing rice production through“Quick Turn-Around”and “Ratoon”crop in between the Wet and Dry Seasons.

E. SPECIFIC RESPONSIBILITIES OF THE PARTIES

[The templates for the specific responsibilities and authorities of the NIA and theIA are presented as Annex 5. Select the appropriate attachment for the contract undernegotiation and make this an integral part of this IMT Contract. Refer to this asAttachment 2 in the final contract]2.

The specific responsibilities of the NIA and the IA are presented as Attachment 2 ofthis Contract.

F. IA COMPENSATION, ISF COLLECTION SHARING SCHEME, PAYMENTSCHEDULE AND PAYMENT CRITERIA

[The determination of the IA compensation, ISF collection sharing scheme forcurrent and back accounts, payment schedule and payment criteria are described inAnnex 1, Annex 6 and Annex 7. These should be discussed and agreed by the NIAand the IA and made an integral part of this Contract. The format in Annex 1 can beadopted and used and titled Attachment 3 for the final IMT Contract.]2

The IA compensation, ISF collection sharing scheme for current and back accounts,payment schedule, payment criteria and penalties as agreed by the contracting parties areattached as Attachment 3 of this contract.

G. ALLOCATION OF IA COMPENSATION AND ISF COLLECTION SHARE

[It is the policy of NIA to ensure the sustainability of the NIS whose managementhas been transferred to the IA. In order to attain this, the disposition of the IA yearlyincome must be balanced for the various operations expenses. It is also appropriate,as part of good financial management practices, to recommend expenditure ratios ofvarious items as percent of total expenses or as percent of total income or as percentof the ISF share of the IA. During the contract negotiation, the NIA shall assist the IAformulate a fund allocation scheme and shall be made an integral part of this contract.The recommended percentage is discussed in Section XI of Annex 2]2

2Items inside bracket [ ] are instructions. Delete these in the final IMT contract.

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The income of the IA from its IMT Contract Compensation shall be allocated as: ____percent for personal services and ____ percent for maintenance and other operatingexpenses (MOOE). The detailed percentage allocations are as follows:


I. Personnel Services

II. MOOE

1. Repair and Maintenance of Irrigation Facilities

2. Repair and Maintenance of Equipment

3. Collection Expenses

4. Office Operation and Maintenance

5. Repair and Maintenance or Patubigayan Trust Fund

6. Miscellaneous

7. Net Income for Capital Build-Up

Total 100

H. IA O&M SEED FUND

[For new IAs or IAs which are not yet financially capable of financing their O&M cost,the NIA shall provide IA O&M Seed Fund equivalent to the IA O&M Cost Requirement forone cropping season or as agreed by both parties. The IA O&M Seed Fund shall be paidwithout interest by the IA upon receiving its incentives/ISF Share at the end of the collectionperiod of the same season the seed fund was granted. The IA O&M Seed Fund can beprovided from initial ISF collections subject to negotiation and agreement by both parties. Anagreement to this effect must be made by the NIA and the IA during contract negotiation andincluded as a provision of the IMT Contract].

The NIA shall provide the IA with IA O&M Seed Fund in the amount of PhP_________which shall be taken out from initial ISF collections. The IA O&M Seed Fund shall be repaidwithout interest by the IA upon receiving its incentives/ISF Share at the end of the collectionperiod of the same season the seed fund was granted.

I. INSPECTION AND AUDIT

The IA shall permit the NIA to inspect the IA’s book of accounts and financial recordsrelating to its operations and to have such documents audited by Auditors appointed by theNIA, if so required by NIA.

J. GENERAL PROVISIONS

Subject to Sections C, D, E and F of this Contract, the following General Provisionsshall apply:

1. All repair works on the structures, conveyance and distribution facilities, andterminal facilities that can be done manually shall be the responsibility of the IA.

2. All repair works that require the use of heavy equipment including those arisingfrom events of force majeure shall be the joint responsibility of the NIA and the IA.

3. The rights, authorities, and obligations of the IA defined in this Contract are nottransferable to any individual or entity.

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K. SPECIAL PROVISIONS

1. All rehabilitation and improvement works defined in the Program of Works jointlyprepared by the NIA and the IA on the irrigation facilities that are subject of thisContract shall be satisfactorily completed by NIA within the prescribed periodafter this Contract has taken effect.

2. NIA shall give priority to the IA as contracting party or its members asconstruction labor in any rehabilitation and improvement works that will beundertaken by NIA within the coverage of the IA.

3. Seasonal NIA and IA IMT Performance Evaluation shall be done jointly by theNIA and the IA following formats shown in Annex 8 of the IMT Policy and whichwill be made part of this Contract.

4. NIA shall provide the IA an office space free of charge until such time that the IAhas established its own Association Office.

5. Contract suspension may be resorted to when: a) the delivery of irrigation serviceto farmers; and b) the viability of operating and maintaining the irrigation systemare negatively affected, as in the following cases:

a. Unresolved dispute/grievance resulting to disruption of the IMT contractarrangement

In such case, the NIA through the IMO under the direction and supervision ofthe RIO shall temporarily suspend the IMT Contract and shall take-over themanagement of irrigation operation and maintenance of the area covered bythe IMT contract. During the IMT contract suspension, the NIA shall have theoption to hire “contract of services” to complement its manpower in themanagement of the area covered by the contract. Resumption of the IMTContract can be negotiated through the mutual agreement of the NIA IMOand the IA concerned. The Contract resumption has to be supported by anotarized NIA-IA Joint Resolution to such effect.

b. Poor NIA or IA IMT Performance affecting irrigation service and financialviability of the system

The IMT Performance Evaluation of the NIA and the IA is evaluated by theprocedure describe in Annex 9. This provides a system of monitoring andevaluating the performance of each party of their IMT Contract responsibilities.When the IMT performance rating of any or both parties is “Satisfactory”orlower, a NIA-IA consultation meeting with the participation of all members ofthe NIS System Management Committee (SMC) particularly the LocalGovernment Unit (LGU) representative shall be conducted to discuss actionsto be done to correct performance gaps. The NIA and the IA must supporteach other and work together to correct any problem on the performance oftheir IMT contract responsibilities in order to sustain efficient irrigation serviceto irrigated farmers and financial viability on the O&M of the irrigation system.

However, in extreme cases where: a) the performance of any of the partiesfails to improve or is equivalent to an adjective rating of “Fair”or lower for two(2) consecutive cropping seasons despite corrective efforts exerted; and b)when the performance of a party is negatively affecting the delivery ofirrigation services to irrigated farmers and the financial viability of operating

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the IMT covered area and the irrigation system, any of the party can decide towrite the other party for the suspension of the IMT contract within one monthnotice.

In case the IA decides to write the suspension letter, this must be addressedto the Manager of the Irrigation Management Office, copy furnished the SMCmembers, Regional Irrigation Manager and the Deputy Administrator forEngineering and Operations at NIA Central Office. In case the NIA decides towrite the letter, this must be addressed to the IA President, copy furnished theSMC members, Regional Irrigation Manager and the Deputy Administrator forEngineering and Operations at NIA Central Office. The IMT contract isdeemed suspended upon receipt of the letter of suspension by the partyconcerned.

In any case of contract suspension, the RIO must conduct an investigation incooperation with the SMC and the Provincial and/or Regional Federation ofIAs (whichever is appropriate) and submit a report with their recommendationto the NIA Administrator within one (1) month from Contract suspension.

When the IMT Contract is suspended (as in Case 1 above) the NIA throughthe IMO under the direction and supervision of the RIO shall take-over themanagement of irrigation operation and maintenance of the area covered bythe IMT contract and the NIA shall have the option to hire “contract ofservices” to complement its manpower in the management of the areacovered by the contract.

Re-negotiation of a suspended IMT contract must be done through mutualagreement of the NIA IMO and the IA subject to the fulfillment of failedobligations of one or both parties and the resolution of other issues thatcaused the contract suspension.

L. SETTLEMENT OF DISPUTE

The NIA through the Staff at the NIS level and the IA concerned shall make every effort toresolve amicably any dispute/grievance arising out of the IMT Contract. When adispute/grievance is not amicably resolved by the contracting parties, the following processwill be adopted.

1. The System Management Committee (SMC), is the first level of responsibility forresolving dispute/grievance at the system level. The SMC as specified in MC 36 s.1997 is composed of concerned NIA Staff and IA/FIA Presidents. In the SMC therepresentation of relevant government agencies. LGUs and other institutions areon call basis or as need arises.

2. Any conflict that is not settled by the SMC will be elevated to the Manager of theIrrigation Management Office (IMO) who will try to resolve such in coordinationwith the President and Board of Trustees of the Provincial Federation of IAs andconcerned IMO Staff. If necessary, the mediation of the Provincial/MunicipalGovernment may be sought for the resolution of the dispute/grievance.

3. If the dispute/grievance is not resolved at the IMO level, such shall be elevated orendorsed to the Regional Irrigation Manager who will coordinate with thePresident and Board of Trustees of the Regional Federation of IAs in resolvingthe dispute/grievance.

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4. In any case that the NIA and IA/FIA concerned: 1) does not agree to submit tothe above process; 2) do not arrive on a mutually agreed solution; or 3) thedispute/grievance is not resolved through the above process, such shall besubmitted to any court of law that has jurisdiction thereof.

Notwithstanding, any reference to settlement of dispute by a court of law, the parties shallcontinue to perform their respective responsibilities under the Contract unless they otherwiseagree.

M. AMENDMENT

This Contract may be amended in part or in full through a written proposal by either party,subject to negotiation and mutual agreement by the parties.

N. EFFECTIVITY

This Contract shall take effect immediately upon signing by both parties and approval ofappropriate NIA authorities, and shall continue until terminated by mutual agreement of theparties.

IN WITNESS WHEREOF, the parties hereunder affixed their signatures this ___th dayof (month), in the year of our Lord, Twenty Hundred and (year) at the municipality or city of(town or city, province).

For the NIA For the IA

___________________ ______________________

SIGNED IN THE PRESENCE OF:________________________ _______________________

________________________ _______________________

Approved:_________________________

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ACKNOWLEDGEMENT

REPUBLIC OF THE PHILIPPINES ) ) SS

BEFORE ME, this _______ day of _______________________, 20__, personally appeared:

Name CTC No. Date/Place Issued

Known to me and known to be the same persons who executed the foregoing instrumentconsisting of _______ (__) pages including this page of acknowledgement, andacknowledged to me that the same is their free and voluntary act and deed, as well as thefree and voluntary act and deed of the principals they represent.

IN TESTIMONY WHEREOF, I have hereunto set my hand and affixed my notarial seal at theplace and on the date first above written.

NOTARY PUBLIC

Doc. No. ______;Page No: ______;Book No. ______;Series of ______.

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Attachment 1IRRIGATION MANAGEMENT TRANSFER CONTRACT

DEFINITION OF TERMS

1. Irrigation Management Transfer - refers to the processes involved in the take overby the Irrigators Associations (IA) of the management, operation and maintenance ofthe national irrigation systems (NIS), wholly or partially, depending on the size of theirrigation system and capacity of the IA.

2. Operation (O) of irrigation systems refers to the activities involved in diverting waterfrom the source and conveying and distributing it to the point of application in thefarmers’fields. The principal tasks in operation are 1) preparation of cropping calendarand schedule of farming activities, 2) measurement of water requirements and supply,3) conveyance and distribution of available water to headgates of lateral canals, 4)distribution of water to turnouts, 5) application of water to farm plots, and 6) drainage ofexcess water from fields.

3. Maintenance (M) refers to the activities undertaken for keeping the irrigation system ingood operating condition at all times within the limitations of available resources toattain maximum use and economic life of the system facilities. The principal tasks inmaintenance are: 1) routine maintenance that include removal of silt at flow measuringdevices, clearing of floating debris accumulated at the crests of proportioning andduckbill weirs, remedial repairs to minimize leakage from control gates and checkstructures, remedial measures to prevent overtopping of canal embankments, greasingor oiling of gates; and 2) periodic maintenance that include cutting of vegetation fromcanal embankments, and reshaping and cleaning canal prism.

4. Major facilities - refer to any of the following: diversion works (dams, intakes, pumpstations, and similar structures), main, lateral canals and service roads, headgates,siphon, drop with road crossing, thresher crossing, conveyance flume, and end checksof main or lateral canals.

5. Terminal facilities - refer to any of the following: turnout structure and gate, main andsupplementary farm ditches, division boxes, and farm drains.

6. Irrigation Service Fee or ISF refers to the fee that an individual farmer or group offarmers, as the case may be, is obliged to pay to NIA for the irrigation service providedto them.

7. Current Account Collectible refers to the ISF that the individual farmer or group offarmers, as the case may be, is obliged to pay the NIA for the immediate past croppingseason. Current account for the immediate past wet season should be paid not laterthan (insert last month) after which it becomes a Back Account. Current account forthe immediate past dry season should be paid not later than (insert last month) afterwhich it becomes a Back Account.

8. ISF collection efficiency –is the ratio, expressed in percent, of the actual collectionsto the current account collectible

9. Old Back Account - refers to all unpaid ISF, which are collectible prior to the initialeffectivity of this Contract. The amount of this account shall be established by NIA onor before the signing date of this Contract. This may not be included in the irrigationfee register (IFR) to be maintained by the IA.

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10. New Back Account - refers to all unpaid ISF which become collectible after theeffectivity date of this Contract.

11. Repair work - refers to any construction-related activity that must be done to bringback the facility to normal operation and/or condition.

12. Emergency repair – refers to construction/restoration work that has to be undertakenand completed without delay in order to continue the operation of the irrigation systemor part thereof for a particular cropping season and/or to save standing crops.

13. Irrigators Associations (IA) - The term irrigators associations refers to the variouslevels of water users associations in various NIS that include but not limited toindividual IAs, Council of IAs (CIA), Federation of IAs (FIA), Confederation of IAs(CFIA), and Irrigation Service Cooperatives (ISC).

14. Service area - refers to the firmed-up number of hectares covered within thejurisdiction of the irrigation system or IA, as the case may be.

15. Recoverable area –is part of the service area that could be irrigated upon completionof the rehabilitation and improvement works.

16. Expansion area – is not part of the service area but which is adjacent, and whichcould be irrigated upon completion of the rehabilitation and improvement works

17. Irrigated area - refers to the actual irrigated and planted number of hectares within thecoverage of the system or IA, as the case may be, and reported in the list of irrigatedand planted area (LIPA) in a given season.

18. Benefited area - refers to the number of hectares in a given season that was irrigated,planted and which produced at least 2 tons of unmilled rice (palay) per hectare (40cavans per hectare).

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46

NIA AND IA IMT RESPONSIBILITIES(Model 1)

Transfer Model No. 1 – The NIA manages the entire NIS but transfers specific operationand maintenance activities to the IA.

Facilities under the IA responsibility:

Name of CanalStation No. of

StructuresNo. of TO

ServiceArea, haFrom To

Total Length 3.873 km 28 10 579

Facilities under the Joint Responsibility of NIA and IA: (Only if applicable asdiscussed in the column IA responsibility on Maintenance succeeding table)


StructuresNo. of TO


Total Length


Manages the entire system but transfersspecific operation and maintenanceactivities to the IA. Specifically the NIA havethe following responsibilities:

Operation

1. Prepare operations plan one monthbefore start of a cropping season.

2. Disseminate information on waterdelivery and planting schedule tofarmers through the different IAs withinthe system.

3. Manage the diversion, delivery anddistribution of irrigation water to differentlateral headgates and turnouts.

4. Establish discharge monitoring pointsand provide stage-discharge ratingtables to IA. Monitor discharges on maincanal and lateral headgates.

5. Collect, compile and summarize LIPAreports from IAs and WRFTs.

6. Resolve water-related conflicts amongIAs and or farmers brought out by IAswithin the irrigation system.

7. Call meetings and conferences todiscuss problems encountered onoperations and formulate solutions with

The coverage of the transferred O&Mresponsibilities will be the IA area. Thespecific responsibilities transferred to the IAare as presented in Section VIII of thisdocument:

Operation

1. Coordinate with NIA on the preparationof Operation Plan within the IA area.

2. Assist NIA in disseminating informationon water delivery and planting schedulesto farmers with the IA area.

3. Monitor discharges at the IA lateralheadgate.

4. Monitor status of farming activities withinIA area and, prepare and submit weeklyLIPA reports.

5. Distribute irrigation water equitablyamong farmers within the IA area.

6. Resolve water-related conflicts amongfarmers and/or TSAGs within the IAarea.

7. Attend meetings and conferences calledby NIA regarding operations problemsand formulation of solutions.

8. Assist in the dissemination of informationto the farmers within the IA area.

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the IAs.8. Prepare system operation performance

and disseminate information to farmersthrough the IAs.

9. Provide the IA with copies of Masterlistof farmers and parcellary map for the IAarea.

Maintenance

1. Undertake all maintenance works at thediversion works, main canal, lateralcanals and canals structures within thesystem except on areas with contractwith IA.

2. Undertake all repair works on irrigationand drainage canals and structureswithin the system.

3. Undertake maintenance of service roadswithin the system.

On ISF Collection

1. Prepare the ISF bills of individualfarmers and farm lots and bundle thebills based on TSA and IA.

2. Distribute the ISF bills to the IAs in areaswith IMT contracts. In areas outside theIMT, distribute the bills to individualfarmers.

3. Collect from paying farmers incoordination with the IA and issue officialreceipts.

4. Record ISF collections, assess ISFcollection efficiency and determine theamount of incentive for each IA with IMTcontract.

5. Undertake necessary accounting andauditing activities on financialtransactions of the system office.

6. Pay IA remuneration on canalmaintenance and share on ISFcollections and other remunerationspromptly based on agreed uponfrequency or collection status.

9. Removal/drainage of excess water fromfields.

Maintenance – Coverage: Lateral canalsand/or portion of Main Canals within the IAarea of responsibility as agreed with theNIA.

1. Periodic maintenance that includemanual desilting and cutting ofvegetation on canal embankments on anagreed schedule with NIA.

2. Routine maintenance that includemanual removal of silt at flow measuringdevices, clearing of floating debrisaccumulated at the crests ofproportioning and duckbill weirs and inletof structures, remedial repairs tominimize leakage from control gates andcheck structures, remedial measures toprevent overtopping of canalembankments, greasing or oiling ofgates.

3. Prevent the following: (a) planting oftrees or any vegetation on canalembankments; (b) construction ofbuilding or any structure on canalembankments; (c) dumping of garbageor any waste inside canals or on theembankments; (d) tying animals oncanal embankments; (e) wallowing ofcarabaos in the canals; (f) constructionof turnouts or similar structures withoutprior authority from NIA; and (g)immediately report to NIA any acts by aperson or group of persons that disruptwater deliveries and/or destroy anyirrigation facility or structure.

Note: Desilting of canals, where this couldbe done manually, shall be the responsibilityof the IA. Where the operation could onlybe done with the use of heavy equipment,this shall be the joint responsibility of the IAand NIA.

Where NIA has suitable equipment, theManager of the Irrigation ManagementOffice (IMO) deploys the equipment fordesilting work and the IA contributes byproviding fuel and oil. In areas where the IAdeploys its own equipment or obtainsequipment assistance from LGU for desilting

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canal sections identified and delineated asjoint responsibility of the IA and NIA, the fueland oil cost shall be borne by the NIA.Suchsections are determined through joint NIA-IAwalk-through one of the items to bediscussed and agreed during contractnegotiation and shall be made part of thecontract.

ISF Collection

1. Distribution of irrigation service fee (ISF)bills.

2. Campaign for payment and assist NIA inthe collection of ISF.

3. Monitor the ISF collections within the IAarea to determine status and IAincentives from collections.

4. Disseminate to members ISF collectionstatus and the amount of IA incentives.

Note: Depending on the capacity and willingness of the IA, ISF collection can be anadded responsibility of the IA especially in NISs that have very limited NIA Staff underthe NIA rationalized structure. This must be discussed and agreed during the NIA-IAIMT contract negotiation.

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Transfer Model 2 –NIA manages the main system, from the headworks to the main canal up tothe headgates of lateral canals and transfers to the IA the management of the laterals, sub-laterals and terminal facilities.



StructuresNo. of

TOServiceArea, haFrom To

Total Length

Facilities under the Joint Responsibility of NIA and IA: (Only if applicable as discussedin the column IA responsibility on Maintenance in the succeeding table)


StructuresNo. of

TOServiceArea, haFrom To

Total Length


Manages the main system, from theheadworks to the head gates of lateralcanals. The specific obligations of theNIA are:

Operation

1. Prepare jointly with IAs and the FIAthe operation plan for the entiresystem and the IA area thatincludes cropping calendar,schedules of farming activities,programmed area for irrigation,water allocation and deliveryschedules.

2. Establish and calibrate dischargemonitoring points and provide IAwith stage-discharge rating tables.

3. Train IA in observing the measuringpoints and utilizing the ratingtables.

4. Deliver appropriate irrigationdiversion requirements at theheadgate of IA based on agreedupon programmed area andschedule.

5. Monitors and evaluate the

The IA manages the whole length of a specifiedlateral including all irrigation facilities downstreamof the headgate of the lateral covered by the IA.The specific responsibilities transferred to the IAare:

Operation

1. Prepare the operation plan for the IA lateralwith NIA one month before initial delivery ofwater every cropping season.

2. Disseminate information on water delivery andplanting schedules to farmers with the IA area.

3. In coordination with the NIA, initiateestablishment and calibration of dischargemonitoring points.

4. Monitor and distribute irrigation water equitablyamong IAs, sub-laterals and turnouts (TO).

5. Safeguard the water rights of all farmersregardless of the proximity of their farms to theheadgate or point of water supply delivery tothe IA.)

6. Monitor and record discharges on all agreedupon observation points and submit data toNIA.

7. Submit operation status reports to NIA thatinclude water situation, list of irrigated andplanted area (LIPA).

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discharges at the headgate of thelaterals and progress of farmingactivities within the system.

6. Formulate O&M policies, rules andregulations and sanctions for theNIS.

7. Assist the IA in formulating andimplementing O&M rules andregulations and sanctions.

8. Provide the IA copies of theupdated parcellary mapsconsidering updated master list offarmers/landowners submitted byIAs.

9. Resolve water-related conflictsamong IAs in the system area (ifany occurs).

10. Removal/drainage of excess waterwithin the coverage of the NIS.

11. Conducts pre-season, mid-seasonand post-season O&M review andplanning for the NIS in coordinationwith IAs/FIA.

12. Provide the IA with copies ofMasterlist of farmers, IFRs andparcellary map for the IA area.

13. Provide capability development tothe IA/FIA on operations.

Repair and Maintenance

1. Prepare yearly repair andRemoval/drainage of excess waterfrom fields.

2. Prepare maintenance plan for thewhole system.

3. Provide the IA with maintenanceguidelines for irrigation facilities.

4. Regularly monitor theimplementation of the repair andmaintenance plan by the IA andprovide regular feedback to IA withsuggestions for improvement.

5. Assist the IA in undertaking repairworks that need utilization of heavyequipment.

6. Assist the IA in formulating policies,rules and regulations for repair andmaintenance of irrigation facilities.

7. Attend monthly meetings of the IABoard of Directors and providetechnical assistance on repair andmaintenance works as deemednecessary.

8. Resolve water-related conflicts among farmersand/or TSAGs within the IA area.

9. Attend meetings and conferences called by NIAregarding operations problems and formulationof solutions.

10. Formulate and enforce policies, rules andregulations on operations including appropriatesanctions for violators.

11. Update master list of water users by TSA everycropping season or as often as necessary.

12. Removal/drainage of excess water from fields.

Repair and Maintenance - Coverage: Lateralcanals and/or portion of Main Canals within the IAarea of responsibility as agreed with the NIA.

1. Prepare yearly repair and maintenance planjointly with NIA on the facilities within the IAarea of coverage.

2. Undertake repair and maintenance worksbased on the plan earlier prepared with theNIA.

3. Routine maintenance, include manual removalof silt at flow measuring devices, clearing offloating debris accumulated at the crests ofproportioning and duckbill weirs and inlet ofstructures, remedial repairs to minimizeleakage from control gates and checkstructures, remedial measures to preventovertopping of canal embankments, greasing oroiling of gates.

4. Periodic maintenance that include manualdesilting and cutting of vegetation on canalembankments.

5. Coordinate and cooperate with NIA inundertaking repair works that need heavyequipment.

6. Prevent the following: (a) planting of trees orany vegetation on canal embankments; (b)construction of building or any structure oncanal embankments; (c) dumping of garbage orany waste inside canals or on theembankments; (d) tying animals on canalembankments; (e) wallowing of carabaos in thecanals; (f) construction of turnouts or similarstructures without prior authority from NIA; and(g) immediately report to NIA any acts by aperson or group of persons that disrupt waterdeliveries and/or destroy any irrigation facility orstructure.

All routine and periodic maintenance tasks withinthe coverage of the IA area are transferred to theIA except mechanized desilting works. Where

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8. Provide capability developmenttraining on maintenance to theIA/FIA.

ISF Collection

1. Provide the IA copies of theirrigation fee registers (IFR).

2. Prepare ISF bill of the IA based onthe submitted LIPA and deliver thispromptly to the IA.

3. Train IA billing clerks orbookkeepers in preparing ISF billsand maintaining IFRs.

4. Monitor regularly the progress ofISF collections and provideassessment feedback to IA.

5. Issue official receipt for everyremittance of ISF collections by theIA.

6. Update NIA File of individualfarmer’s IFR based on ISFcollection report submitted by theIA.

7. Conduct regular and spot audits ofIA collectors and books ofaccounts. Provide feedback to IAon audit findings.

8. Pay IA share on ISF collections andother remunerations promptlybased on agreed upon frequency orcollection status.

9. Keep and safeguard seasonal filereports on: a) LIPA; and ISFcollection as reference during theNIA-IA assessment andreconciliation of ISF collections,collection efficiency andremittances, and as back-up copiesof IA Files.

desilting could only be done with the use of heavyequipment, this shall be the joint responsibility ofthe IA and NIA. These sections should bespecifically defined in the IMT contract by citing thecanal name and stationing. Such sections aredetermined through joint NIA-IA walk-through andone of the items to be discussed and agreed duringcontract negotiation. Desilting done through thejoint effort of the IA and NIA is implemented asfollows:

1. Where NIA has suitable equipment, theManager of the Irrigation Management Office(IMO) deploys the equipment for desilting workand the IA contributes fuel and oil.

2. Where the IA deploys its own equipment orobtains equipment assistance from LGU fordesilting canals, the fuel and oil cost shall beborne by the NIA.

ISF Collection

1. Prepare seasonal or annual financial plan andbudget based on O&M plans giving utmostimportance to operations and maintenanceobligations of the IA.

2. Receive the ISF bill from NIA and prepare ISFbills for individual farmers and consolidate byTSA and/or member-IAs for easier distributionwithin the IA area.

3. Distribution of ISF bills to individual farmers andcampaign for ISF payment.

4. Collection of ISF payments from farmers withinits coverage from farmers within its coverage.

5. Safeguarding and remitting ISF collections tothe NIA.

6. Regularly submit ISF collection report to theNIA and disseminate collection progress to IAmembers and farmers.

7. Establishment, updating and maintenance ofirrigation fee registers (IFR) within the IAservice area.

Note: The preparation of ISF bills is considered for turn-over to the IA. However, sinceISF bill preparation is computerized, unless the IA procure their own computer and havetrained personnel to do the job, this responsibility cannot be turned-over to the IA.Hence, when the IA lacks the equipment and manpower to do ISF bill preparation, theresponsibility shall be done by the NIA but the cost for such shall be considered as partof the NIA Cost in the determination of the O&M Cost “Break-Even Point”and the NIA-IAISF collection share. This shall be discussed and agreed during the NIA-IA IMT Contractnegotiation. The responsibility will be turned-over to the IA once they attain thecapability to perform the job and at that time the IA and NIA ISF collection share will bere-negotiated.

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52


Transfer Model 3 –The NIA Manages the headworks and portion of main canal up to the junctionof the first lateral canal headgate. The IA is responsible on the management, operation andmaintenance (O&M) of the rest of the system from the junction of the first lateral canal headgatedown to the farm level facilities. This is an expanded form of Model 2.



StructuresNo. of TO


Total Length

Facilities under the Joint Responsibility of NIA and IA: (Only if applicable as discussed inthe column IA responsibility on Maintenance in the succeeding table)


StructuresNo. of TO


Total Length


Manages the headworks and portion ofmain canal up to the junction of the firstlateral canal headgate. The specificresponsibilities of the NIA are:

Operation

1. Prepare jointly with IAs and the FIAthe operation plan for the entiresystem and the IA area thatincludes cropping calendar,schedules of farming activities,programmed area for irrigation,water allocation and deliveryschedules.

2. Establish and calibrate dischargemonitoring points and provide IAwith stage-discharge rating tables.

3. Train IA in observing the measuringpoints and utilizing the ratingtables.

4. Deliver appropriate irrigationdiversion requirements at theheadgate of IA based on agreedupon programmed area andschedule.

5. Monitors and evaluate the

Management and/or Operation and Maintenance(O&M) of the rest of the system from the junction of thefirst lateral canal headgate down to the farm levelfacilities. This is an expanded form of Model 2.Thespecific responsibilities transferred to the IA are:

Operation

1. Prepare the operation plan for the IA lateral withNIA one month before initial delivery of water everycropping season.

2. Disseminate information on water delivery andplanting schedules to farmers with the IA area.

3. In coordination with the NIA, initiate establishmentand calibration of discharge monitoring points.

4. Monitor and distribute irrigation water equitablyamong IAs, sub-laterals and turnouts (TO).

5. Safeguard the water rights of all farmers regardlessof the proximity of their farms to the headgate orpoint of water supply delivery to the IA.)

6. Monitor and record discharges on all agreed uponobservation points and submit data to NIA.

7. Submit operation status reports to NIA that includewater situation, list of irrigated and planted area(LIPA).

8. Resolve water-related conflicts among farmersand/or TSAGs within the IA area.

9. Attend meetings and conferences called by NIA

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53


discharges at the headgate of thelaterals and progress of farmingactivities within the system.

6. Formulate O&M policies, rules andregulations and sanctions for theNIS.

7. Assist the IA in formulating andimplementing O&M rules andregulations and sanctions.

8. Provide the IA copies of theupdated parcellary mapsconsidering updated master list offarmers/landowners submitted byIAs.

9. Resolve water-related conflictsamong IAs in the system area (ifany occurs).

10. Removal/drainage of excess waterwithin the coverage of the NIS.

11. Conducts pre-season, mid-seasonand post-season O&M review andplanning for the NIS in coordinationwith IAs/FIA.

12. Provide the IA with copies ofMasterlist of farmers, IFRs andparcellary map for the IA area.


1. Prepare yearly repair andRemoval/drainage of excess waterfrom fields.

2. Prepare maintenance plan for thewhole system.

3. Provide the IA with maintenanceguidelines for irrigation facilities.

4. Regularly monitor theimplementation of the repair andmaintenance plan by the IA andprovide regular feedback to IA withsuggestions for improvement.

5. Assist the IA in undertaking repairworks that need utilization of heavyequipment.

6. Assist the IA in formulating policies,rules and regulations for repair andmaintenance of irrigation facilities.

7. Attend monthly meetings of the IABoard of Directors and providetechnical assistance on repair andmaintenance works as deemednecessary.

regarding operations problems and formulation ofsolutions.

10. Formulate and enforce policies, rules andregulations on operations including appropriatesanctions for violators.

11. Update master list of water users by TSA everycropping season or as often as necessary.



1. Prepare yearly repair and maintenance plan jointlywith NIA on the facilities within the IA area ofcoverage.

2. Undertake repair and maintenance works based onthe plan earlier prepared with the NIA.

3. Routine maintenance, include manual removal ofsilt at flow measuring devices, clearing of floatingdebris accumulated at the crests of proportioningand duckbill weirs and inlet of structures, remedialrepairs to minimize leakage from control gates andcheck structures, remedial measures to preventovertopping of canal embankments, greasing oroiling of gates.

4. Periodic maintenance that include manual desiltingand cutting of vegetation on canal embankments.

5. Coordinate and cooperate with NIA in undertakingrepair works that need heavy equipment.

6. Prevent the following: (a) planting of trees or anyvegetation on canal embankments; (b) constructionof building or any structure on canal embankments;(c) dumping of garbage or any waste inside canalsor on the embankments; (d) tying animals on canalembankments; (e) wallowing of carabaos in thecanals; (f) construction of turnouts or similarstructures without prior authority from NIA; and (g)immediately report to NIA any acts by a person orgroup of persons that disrupt water deliveriesand/or destroy any irrigation facility or structure.

All routine and periodic maintenance tasks within thecoverage of the IA area are transferred to the IAexcept mechanized desilting works. Where desiltingcould only be done with the use of heavy equipment,this shall be the joint responsibility of the IA and NIA.These sections should be specifically defined in theIMT contract by citing the canal name and stationing.Such sections are determined through joint NIA-IAwalk-through and one of the items to be discussed andagreed during contract negotiation. Desilting donethrough the joint effort of the IA and NIA isimplemented as follows:

1. Where NIA has suitable equipment, the Manager of

Annex 5(Model 3)

54


ISF Collection

1. Provide the IA copies of theirrigation fee registers (IFR).

2. Prepare ISF bill of the IA based onthe submitted LIPA and deliver thispromptly to the IA.

3. Train IA billing clerks orbookkeepers in preparing ISF billsand maintaining IFRs.

4. Monitor regularly the progress ofISF collections and provideassessment feedback to IA.

5. Issue official receipt for everyremittance of ISF collections by theIA.

6. Update NIA File of individualfarmer’s IFR based on ISFcollection report submitted by theIA.

7. Conduct regular and spot audits ofIA collectors and books ofaccounts. Provide feedback to IAon audit findings.

8. Pay IA share on ISF collections andother remunerations promptlybased on agreed upon frequency orcollection status.

9. Keep and safeguard seasonal filereports on: a) LIPA; and ISFcollection as reference during theNIA-IA assessment andreconciliation of ISF collections,collection efficiency andremittances, and as back-up copiesof IA Files.

the Irrigation Management Office (IMO) deploys theequipment for desilting work and the IA contributesfuel and oil.

2. Where the IA deploys its own equipment or obtainsequipment assistance from LGU for desiltingcanals, the fuel and oil cost shall be borne by theNIA.

ISF Collection

1. Prepare seasonal or annual financial plan andbudget based on O&M plans giving utmostimportance to operations and maintenanceobligations of the IA.

2. Receive the ISF bill from NIA and prepare ISF billsfor individual farmers and consolidate by TSAand/or member-IAs for easier distribution within theIA area.

3. Distribution of ISF bills to individual farmers andcampaign for payment.

4. Collection of ISF payments from farmers within itscoverage from farmers within its coverage.

5. Safeguarding and remitting ISF collections to theNIA.

6. Regularly submit ISF collection report to the NIAand disseminate collection progress to IA membersand farmers.

7. Establishment, updating and maintenance ofirrigation fee registers (IFR) within the IA servicearea.

Note: The preparation of ISF bills is considered for turn-over to the IA. However, since ISFbill preparation is computerized, unless the IA procure their own computer and havetrained personnel to do the job, this responsibility cannot be turned-over to the IA. Hence,when the IA lacks the equipment and manpower to do ISF bill preparation, theresponsibility shall be done by the NIA but the cost for such shall be considered as part ofthe NIA Cost in the determination of the O&M Cost “Break-Even Point”and the NIA-IA ISFcollection share. This shall be discussed and agreed during the NIA-IA IMT Contractnegotiation. The responsibility will be turned-over to the IA once they attain the capabilityto perform the job and at that time the IA and NIA ISF collection share will be re-negotiated.

Annex 5(Model 4)

55


Transfer Model 4 – The NIA transfers to the IA the full management and use of the irrigationsystem including the headworks and provides technical assistance to the IA on the managementof their organization and the O&M of the irrigation system.


NIA transfers to the IA themanagement of the entiresystem including theheadworks and providesonly technical assistance tothe IA on the managementof their organization and theO&M of the irrigationsystem.

NIA is responsible onmonitoring, evaluation andprovision of technicalassistance of the IA.Specifically NIA will do thefollowing responsibilities:

1) Provision of technicalassistance to the IA onthe preparation of O&Mplans of the system.

2) Monitoring andevaluation of the O&Mof the Irrigation System.

3) Monitoring andevaluation of the IAorganizationalmanagement.

4) Provision of technicalassistance andsupervision on the O&Mof the system.

5) Provision of technicalassistance on thecapability developmentof the IA.

6) In case of “forcemajeure” like typhoonsand earthquake wherethe system suffers majordamages, the NIA willsurvey the damages anddo detailed engineeringworks for the repairs tobe done in consultationand cooperation with the

The IA manages the entire system. It becomes responsible ofO&M planning implementation, monitoring and evaluation for theentire system, the setting up and collecting ISF rates, andirrigation system improvement/modernization program.

The IA will pay NIA a System Rental Fee equivalent to the moneyof 1.50 cavans of dry paddy value (computed at the governmentsupport price of palay at the time of billing) per hectare perseason based on the firmed-up service area of the system. TheRental Fee will cover the cost of technical assistance and cost ofusing the irrigation facilities and structures.

The System Rental Fee is payable in two (2) equal installmentsfor each season (wet and dry seasons). Payment of the RentalFee installments shall be within one month from the end of ISFcollection period for every season.

Specifically, the IA does the following responsibilities for the entiresystem service area:

Operation

1. Prepare operation plan for the system NIA one month beforeinitial delivery of water every cropping season.

2. Disseminate information on water delivery and plantingschedules to farmers.

3. In coordination with the NIA, initiate establishment andcalibration of discharge monitoring points.

4. Monitor and distribute irrigation water equitably.5. Safeguard the water rights of all farmers regardless of the

proximity of their farms to the headgate or point of watersupply delivery.)

6. Monitor and record discharges on all agreed upon observationpoints and submit data to NIA.

7. Submit operation status reports to NIA that include watersituation, list of irrigated and planted area (LIPA).

8. Resolve water-related conflicts among farmers and/or TSAGs.9. Attend meetings and conferences called by NIA regarding

operations problems and formulation of solutions.10. Formulate and enforce policies, rules and regulations on

operations including appropriate sanctions for violators.11. Update master list of water users by TSA every cropping

season or as often as necessary.12. Conducts pre-season, mid-season and post-season O&M

review and planning with the participation of the NIA andTSAG leaders, and members of the SMC.

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IA.7) Finance 70% of the

works to be done incase of damages by“force majeure” and/ormajor repair andrehabilitation.

8) Responsible for theimplementation of therepair works due todamages by “forcemajeure” and/or majorrepair and rehabilitation.in cooperation with theIA.

9) Conducts at least 4supervisory visits of theIA/NIS per season.

10)Provide the IA withcopies of Masterlist offarmers, IFRs, parcellarymaps, irrigation systemmap showing irrigationfacilities and structuresand simplified operationmanual for the system.

11)Update NIA File ofindividual farmer’s IFRbased on ISF collectionreport submitted by theIA.

12)Keep and safeguardseasonal file reports on:a) LIPA; and ISFcollection as referenceduring the NIA-IAassessment andreconciliation of ISFcollections, collectionefficiency andremittances, and asback-up copies of IAFiles.



1. Prepare yearly repair and maintenance plan.2. Undertake and finance regular repair and maintenance work

for the system.3. Assist the NIA in conducting survey works and detailed

engineering design for repairs of damages due to “forcemajeure”.

4. Finance at least 30% of the cost of repair works to be done fordamages due to “force majeure” and/or major repair andrehabilitation. This could be in the form of cash, labor andmaterials.

5. Assist the NIA in the implementation of the repair works due todamages by “force majeure” and/or major repair andrehabilitation.

6. Prevent the following: (a) planting of trees or any vegetationon canal embankments; (b) construction of building or anystructure on canal embankments; (c) dumping of garbage orany waste inside canals or on the embankments; (d) tyinganimals on canal embankments; (e) wallowing of carabaos inthe canals; (f) construction of turnouts or similar structureswithout prior authority from NIA; and (g) immediately report toNIA any acts by a person or group of persons that disruptwater deliveries and/or destroy any irrigation facility orstructure.

ISF Collection

1. Prepare seasonal or annual financial plan and budget basedon O&M plans giving utmost importance to operations andmaintenance obligations for the whole system.

2. Prepare ISF bills for individual farmers and consolidate byTSA and/or member-IAs for easier distribution to all irrigatedfarmers within the system.

3. Distribution of ISF bills to individual farmers and campaign forpayment.

4. Collection of ISF payments from farmers within its coveragefrom farmers within its coverage.

5. Safeguarding ISF collections.6. Regularly submit to the NIA copies of ISF collection reports

and disseminate collection progress to IA members andfarmers.

7. Establishment, updating and maintenance of irrigation feeregisters (IFR) within the system service area.

Note: The preparation of ISF bills is considered for turn-over to the IA. However, since ISFbill preparation is computerized, unless the IA procure its own computer and have trainedpersonnel to do the job, this responsibility cannot be turned-over to the IA. Hence, whenthe IA lacks the equipment and manpower to do ISF bill preparation, this shall be done bythe NIA but the cost of doing this shall be determined and agreed by the NIA and the IA andshall be paid by the IA along with the Irrigation System Rental Fee. This shall be discussedand agreed during the NIA-IA IMT Contract negotiation. The responsibility will be turned-over to the IA once they attain the capability to perform the job.

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57

IA COMPENSATION AND NIA-IA ISF CURRENT ACCOUNT COLLECTIONSHARING SCHEME

(Model 1)

Guideline for determining the IA compensation and ISF Collection share for Model 1Contract.

1. For Canal Maintenance

This will be negotiated by the NIA and IA considering the standard labor capacity for clearingestimated at 220 m2/hour and the wage rates in the area based on the Regional WageBoard or Prevailing Market Rates whichever is higher, at the time of billing.

Sample Computation:

Given the following data:

1) Canal length = 3.5 kilometers2) Average width of canal embankment to be cleaned (above operating water level) =

0.30 meters on each side.3) Prevailing labor rate in the area is P300/day

Computation

1) Area to be cleaned = (3.50 km) X (1,000 meters/km) X (0.30 meters/side) X (2 sides)= 2,100 m2

2) Number of days to clean the given canal length by one person= (2,100 m2) / (220m2/day)= 9.45 days

3) The remuneration of the IA for every canal clearing and maintenance for the givencanal length is:= (9.45 days) X P300/day= P2,863.64 per clearing

The sample computation shows that for the given data and information, the IA will becompensated at P2,863.64 per clearing. The rate will change depending on the currentlabor rates in the area at the time of billing/payment. The prescribed vegetation clearingis at least once in 45 days or about 3 times per season (5 months) but not more frequentthat once a month or 5 times per season.

2. NIA-IA Sharing Scheme

The IA shall be granted incentive for its performance of specific O&M responsibilities andcampaigning for payment of current ISF collectibles from farmer-beneficiaries within the IAservice area. A “base ISF collection level”must be agreed by the NIA and the IA. Thesuggested base ISF collection level to be negotiated with the IA is 55%. If this is the agreed basecollection level, the IA starts to have a share of the ISF collection at percentages above 55% to100%.

The IA ISF collection share is computed as percentage of the total collection which will be at0% for collection at 55%(or the agreed cut-off collection level) up to the maximum of 15%when ISF collection reaches 100% of the total collectibles. This means that the IA will have ashare of one-third percent (1/3%) of the total collection for every one (1) percent increase on

Annex 6

58

ISF collection from 70%. The computation of the percentage share of the IA is illustrated asin the 3 sample computations below. The final percentage share of the IA will be based onthe Current ISF Collection Efficiency attained at the end of the collection period.

Computation on how 1/3 % was arrived at:

Share of the IA for every percent increase in collection from 55% = 15% divided by 100%minus 55%, or this is equal to = 15/(100 - 45) = 15/45 = 1/3

Sample computation 1

1. Actual collection reached 100%2. The incremental increase of collection from 55% is = 100 –55

= 45%3. Percentage share of the IA = 45 X (1/3) = 15% of total actual collections at 100%

Sample computation 2

1. Actual collection reached 56%2. The incremental increase in collection from 55% to 56% = 56 –55 = 1%3. The Percentage share of the IA = 1 X (1/3) = 0.333% of the total actual collections

at 56%

Sample computation 31. Actual collection is at 55.01%2. The incremental increase in collection from 55.01% = 55.01 - 55.00

= 0.01%3. The percentage share of the IA = 0.01 x (1/3) = 0.00333% of the total collections

at 55.01%

The current account collection efficiency (CE) is the ratio of collection from current accountagainst current account collectible, expressed in percent.

In this arrangement, the SWRFT/Collector issues the Official Receipt (OR) to paying farmersand shall be accountable for all ORs and ISF collections. The IA merely assists theSWRFT/Collector in the collection of ISF payments through campaigning for payments andother assistance to motivate irrigated farmers to pay.

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NIA-IA ISF CURRENT ACCOUNT COLLECTION SHARING SCHEME(Model 2)

The repair and maintenance of canals is part and parcel of the responsibility of the IA in theModel 2 Contract and shall not be given separate compensation besides their share of ISFCurrent Collection as it is considered an integral part of their share from the current accountcollection which will be determined through this guideline.

Any discount granted by the IA to individual farmer for prompt payment of current account incash shall be charged against the share of the IA. It is, therefore, up to the IA whether or notto continue granting discount to individual farmers.

1. Model 2 Gravity

The share of the IA from current account collections shall be subject to negotiation with theNIA based on the concept of “fair sharing of burden and benefits”. In the concept of “fairshare of responsibilities and benefits”, responsibilities shall be interpreted as theresponsibility of each party in the O&M of the area being considered for transfer; and“benefits” shall be interpreted as the share of each party on the ISF collection which isestimated based on their share of the break-even point O&M cost within the area consideredfor transfer.

Hence, it will be necessary to do an open and transparent estimation of the cost that eachparty will incur when the IA assumes irrigation management responsibilities for a Model 2contract.

a. The Share of NIA on the Break-Even O&M Cost must include:

1) O&M Cost of NIA at System level expressed in P/hectare of NIS Firmed-UpService Area. This shall include:

a) Personnel services cost. This covers salaries and wages plus other personnelservices cost such as GSIS and Health Insurance.

b) Maintenance and Other Operating Expenses excluding IA Remunerationsand Shares

2) Cost due to IMO Technical Support which is composed of same items as aboveexpressed on P/hectare of the Total Firmed-Up Service Area of all NISs coveredby the IMO.

3) Cost due to RIO Technical Support which is composed of same items as aboveexpressed in P/hectare of the Total Firmed-Up Service Area of all NISs coveredby the RIO.

4) Cost due for the NIA Central Office at 10%1.

To get the share of the NIA of the total Break-Even O&M Cost, the total of cost items“1)”, “2)”, “3)”and “4)”above will be multiplied to the Total Firmed-Up Service Area of

1 The estimated percentage share of the NIA Central Office is at 13% at full Salary Standardizationimplementation and full Rationalization Plan implementation –as computed by the Institutional DevelopmentDepartment (IDD). However, since the NIA CO is also getting income from 5% Management Fee, equipmentrental, etc., 10% is recommended.

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60

the IA subject for IMT.

b. The share of the IA on the Break-Even O&M Cost must include:

The O&M Cost of IA in the performance of its responsibilities on the O&M of the IA areaunder Model 2 shall include:

1) Personnel services cost for the performance of IA responsibilities under Model2. This covers salaries and wages of IA employees (such as billing clerk,bookkeeper) for O&M; incentives of IA Offices/Leaders; etc.

2) Maintenance and Other Operating Expenses. This covers travellingexpenses, communications, supplies and materials, office maintenance (ifany), repair and maintenance of facilities and equipments, insurance, etc.

3) Overhead Cost due to technical support of the NIS IA Federation andProvincial/Regional IA Federation (if any)

The total of items “1)”, “2)”and “3)”above will be the share of the IA on the O&M Break-Even O&M Cost. The Total of the NIA and IA Share on the Break-Even O&M Cost will beconsidered the Total Break-Even O&M Cost within the IA Area of responsibility.

Hence, the share of NIA will be the percentage of its O&M Cost to the Total Break-EvenO&M Cost and the share of the IA will be the percentage of its O&M Cost to the TotalBreak-Even O&M Cost. The resulting percentage share will be the percentage share ofeach party to any amount of current ISF collected.

2. Model 2 Pump Systems

All ISF collections shall first be allocated for payment of 50% of the energy cost. The other50% of the energy cost will be subsidized by NIA in consideration of MC No. 41 s.2007.Sharing of ISF collections in excess of 50% of the energy cost, shall be negotiated by theIA and the NIA based on the concept of “fair sharing of responsibilities and benefits”similar to that for Model 2 Gravity Systems above.

Any discount granted by the IA to individual farmer for prompt payment of current account incash shall be charged against the share of the IA. It is, therefore, up to the IA whether or notto continue granting discount to individual farmers for prompt payment of their ISF.

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1. Model 3 Gravity Systems

The share of the IA from current account collections shall be subject to negotiation with theNIA based on the concept of “fair sharing of responsibilities and benefits”. Computation ofthe NIA-IA Sharing Scheme shall follow the pattern explained for Model 2 above except thatthe share of NIA will proportionately reduce due to assumption of higher responsibility by theIA. The number of personnel of the NIA will also be reduced for the performance ofresponsibility from the dam to only a portion of the main canal up to the first lateral headgate.


2. Model 3 Pump Systems

All ISF collections shall first be allocated for payment of 50% of the energy cost. The other50% of the energy cost will be subsidized by NIA in consideration of MC No. 41 s.2007.Sharing of ISF collections in excess of 50% of the energy cost, shall be negotiated by theIA and the NIA based on the concept of “fair sharing of responsibilities and benefits”similar to that for Model 2 Gravity Systems above.


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Model 4 Gravity and Pump Systems

The IA manages the entire system and becomes responsible for all the O&M activitiesincluding setting up and collecting ISF rates, and irrigation systemimprovement/modernization program.

The IA will pay to NIA an Irrigation System Rental Fee equivalent to the money value of 1.50cavans of dry paddy (computed at the government support price of palay at the time ofbilling) per hectare per year based on the firmed-up service area (FUSA) of the system. TheRental Fee will cover the cost of technical assistance and cost of using the irrigation facilitiesand structures.

The Irrigation System Rental Fee is payable in two (2) equal installments of the money valueof 75 kilograms for each season (wet and dry seasons). Payment of the Irrigation SystemRental Fee installments shall be within one month from the end of ISF collection period forevery season.

In case of major damages due to “force majeure”, the NIA will be responsible for doing thedetailed engineering and implementation of the repair works with IA participation and willfinance 70% of the cost. The IA will finance 30% of the cost and assist the NIA in theplanning and implementation of the physical works to be done.

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NIA-IA ISF BACK ACCOUNT COLLECTION SHARING SCHEME

The share of the IA for the collection of ISF back accounts due to the NIA will be determinedthrough the following guideline.

IMT Contract IA Compensation/Incentives from ISF Collection on Back Accounts

Model 1

Back Accounts before the signing of the Model 1 Contract:

IA Share: 25% of actual collection (principal and surcharges)NIA Share: 75% of actual collection (principal and surcharges)

Back accounts after signing of the Model 1 contract:

IA Share: 5% of actual collection(principal and surcharges)NIA Share: 95% of actual collection (principal and surcharges)

Model 2

Back Accounts before signing of the Model 2 Contract:


Collection of ISF back accounts after signing of the Model 2 Contract willbe the responsibility of the IA.

Model 3

(If the IA did not pass through Model 2 Contract) Back Accounts beforethe signing of the Model 3 Contract:


Back accounts after signing of the Model 2 or Model 3 Contract will be theresponsibility of the IA.

Model 4

(If the IA did not pass through Model 2 and Model 3 Contract) BackAccounts before the signing of the Model 4 Contract:

IA Share: 25% of actual collection (principal and surcharges)NIA Share: 75% of actual collection (principal and surcharges)Back accounts after signing of the Model 2 or Model 3 or Model 4 Contractwill be the responsibility of the IA.

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NIA and IA IMT Performance Evaluation System

There are two major components in the Monitoring and Evaluation (M&E) system forassessing the implementation of the IMT Program: a) NIA IMT Performance Evaluation; andb) the IA IMT Performance Evaluation.

The NIA Performance is assessed on Indicators related to: 1) assistance for the organizationand capability development of the IAs for performing their responsibilities under IMT; 2)operation, specifically the implementation of water delivery schedules based on O&M plan;and 3) repair, improvement and/or rehabilitation of the physical facilities (irrigation, drainageand roads).

At the end of the season, the IAs and/or Federation of IAs will be given the NIA IMTPerformance Evaluation Form and this will be completed through an IA BOD Meeting. Thecompleted form will then be submitted to the Manager of the Irrigation Management Office(IMO) by the IA President for consolidation, analysis and discussion with the NIS Staff. Theresults of NIA IMT Performance Evaluation will be presented and discussed along with theIA IMT Performance Evaluation done by the NIA during the End-Season O&M Review andPlanning Workshop with the members of the SMC for finalization and signing by themembers of the SMC. During the workshop, discussion and agreements on what to be doneby the NIA and FIA/IA(s) to improve their performance and the NIA-IA partnership must alsobe done. The results of this will form part of the basis of the succeeding season’s NIA and IAIMT Performance Evaluation. The consolidation of the NIA IMT Performance Evaluation willbe done using Table 1. Copies of this report must be submitted to the Engineering andOperations Division of the Regional Irrigation Office, the Operations Department of theEngineering and Operations Sector and to the Project Management Office of a Projectcovering specific NISs, for review, analysis as basis for provision of technical assistance.

1. NIA IMT Performance Evaluation

The NIA IMT Performance Evaluation will be done by the SMC in session. The NIA shallmake available to the SMC all pertinent source reports necessary as reference for theevaluation. The indicators are basically lifted out from the various plans developed in Phase3 (Participatory Planning Phase) of the IMT implementation Process.

Activities Computation Points

I. Assistance to IA 40

1. Training/Strengthening Assistance to IA (Batches Conducted/Batches Planned) X 10 10

2.O&M Review and Planning Meeting/Workshop

(Batches Conducted/Batches Planned) X 10 10

3. Walk-Through Inspection with the IA (Batches Conducted/Batches Planned) X 10 10

4.ISF Collection Feedback andReconciliation Conference

(Batches Conducted/Batches Planned) X 10 10

II. Operation

6. Compliance to water delivery schedules

(Days with Qa=>Qp / Days canal has Q) X30or

(No. of days of actual water delivery) / No. ofagreed Scheduled Days of Water Delivery)X 100;Where Q = Discharge; subscript a = Actualand subscript p = plan or program

30

III.Construction/Repair/Improvement of Physical Facilities (Agreed construction/ repair/improvement works to be done and/or supported by NIA. Include repairs due to “forcemajeure”or other calamities.)

30

7. Irrigation(No. of actual works accomplished/No. ofworks planned) X 30

15

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Activities Computation Points

8. Drainage (under NIA responsibility)(No. of actual works accomplished/No. ofworks planned) X 30

10

9.Roads along canals (under NIAresponsibility)

(No. of actual works accomplished/No. ofworks planned) X 30

5

Total Numerical Rating 100

Equivalent Adjective Ratings

1 Outstanding 95 and above

2. Very Satisfactory 85 to 94

3. Satisfactory 75 to 84

4. Fair 65 to 74

5. Poor Below 65

Prepared by:__________________________

IA President

Conforme: (IA BOT, Signature over printed name)

__________________________ __________________________

__________________________ __________________________

__________________________ __________________________

__________________________ __________________________

__________________________ __________________________

__________________________ __________________________

__________________________ __________________________

__________________________ __________________________

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2. IA IMT Contract Eligibility Criteria and Performance Evaluation

Before an IA can be declared eligible in negotiating for any model contract, the IAperformance will be evaluated on the IA IMT Contract Eligibility Criteria as follows:

IA IMT Contract Eligibility Criteria

The evaluation of the eligibility of the IA to negotiate for a contract will be done by the NIAwith the results presented and consulted to the IA and the SMC.

The following IA Eligibility Criteria will be used in determining the eligibility of an IA or FIA innegotiating for the different IMT Model Contracts. The following eligibility criteria must all befulfilled/met for an IA to be declared eligible in negotiating for a specific IMT Contract.

Contract IA Eligibility Criteria

1. Model 1Contract

1.1 Capability in performing responsibilities for Model 1 Contract

a. Had been trained and can prepare LIPA for the IA Area ofresponsibility

b. Had been trained and can perform repair and maintenanceresponsibilities.

c. Had been trained and know strategies and timing of billdistribution.

d. Had been trained and knows strategies and timing of ISFcollection campaign.

e. At least Satisfactory IA Functionality Rating for the last IAFunctionality Evaluation.

f. IA members agree to establish Trust Fund for repair andmaintenance (Patubigayan Trust Fund) from their remunerationsand ISF collection share once they enter into the Model 1Contract. This must be established and maintained after the IAhad signed a Model 1 Contract with the NIA.

1.2 Other Criteria for Model 1 Contract

a. IA Members had been consulted and agreed with the plan of theIA to negotiate for a Model 1 Contract (proof: Minutes of GeneralAssembly Meeting and/or TSAG (all) Meetings) Has written andupdated O&M Plans

b. The IA is registered and in the active file of appropriategovernment entity (SEC or CDA) at the time of contracting, and iscapable and willing to operate and maintain the NIS, wholly orpartially.

c. Have a TSAG and IA level sharing system on IA Remunerationsand ISF Collection Campaign Incentives.

d. 75% or higher IA Membership

e. At least 80% average IA members’attendance in IA meetings andgroup activities

f. The IA practices transparency in its financial transactions, i.e.,prepares and disseminate regular financial statements/reports (atleast once per season) to IA members.

g. IA Annual Budget allocates at least 60% of income for O&Mactivities within the IA area of responsibility.

h. IA has O&M Plans (Cropping Calendar/Pattern; Repair &Maintenance; Water Delivery & Distribution Schedule; and IABudget/Financial Management Plan

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Contract IA Eligibility Criteria

i. Has written IA O&M Policies

2. Model 2 to4Contracts

1.1Capability in performing responsibilities for the IMT Contract(same criteria for Models 2 to 4 Contracts but the areacoverage differs)

a. IA has the capability to prepare LIPA for the IA Service Area

b. IA has the capability to prepare ISF Bills for individualfarmers/farm lots for IA Service Area

c. The IA had distributed ISF more than 90% of ISF bills on orbefore harvest in two consecutive seasons.

d. IA has the capability to collect Irrigation Service Fees (ISF). It hasofficial receipts, ISF collection report forms, established system ofcollection and remittance, designated collectors, plannedstrategies on ISF collection, etc.

e. IA has the capability to update and maintain Irrigation FeeRegister (IFR) of individual farmers/farm lots

f. The IA can or had performed well its repair and maintenanceresponsibilities.

e. At least Very Satisfactory IA Functionality Rating for the last IAFunctionality Evaluation.

f. The IA has viability of 1.0 or better in the last wet and dryseasons.

g. Is maintaining a Trust Fund for repair and maintenance(Patubigayan Trust Fund)

1.2 Other Criteria for Model 2 or higher form of Contracts

a. The IA is registered and in the active file of appropriategovernment entity (SEC or CDA) at the time of contracting, and iscapable and willing to operate and maintain the NIS, wholly orpartially.

b. IA Members had been consulted and agreed with the plan of theIA to negotiate for the IMT Contract (proof: Minutes of GeneralAssembly Meeting and/or TSAG (all) Meetings) Has written andupdated O&M Plans

c. Have a TSAG and IA level sharing system on IA Remunerationsand ISF Collection Campaign Incentives.

d. 90% or higher IA Membership

e. 90% average IA members’attendance in IA meetings and groupactivities

f. The IA practices transparency in its financial transactions, i.e.,prepares and disseminate regular financial statements/reports (atleast once per season) to IA members.

g. IA Annual Budget allocates at least 60% of income for O&Mactivities within the IA area of responsibility.

h. IA has O&M Plans (Cropping Calendar/Pattern; Repair &Maintenance; Water Delivery & Distribution Schedule; and IABudget/Financial Management Plan

i. Has written IA O&M Policies

IA IMT Performance Evaluation

The IA IMT Performance Evaluation will be done by the NIA but such shall be presented andreviewed by the SMC.

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Any IA that signed an IMT Contract will be evaluated using the IA IMT Assessment at theend of every season on indicators of performance of their responsibilities in the IMT Contractand performance on organizational management, O&M and financial management. Therating sheet is presented below. This is different from the IA Functionality Survey1 which isconducted annually on three (3) major groups of indicators namely: a) Operation andMaintenance; b) Organizational Management; and c) Financial Management.

At the end of the season, the NIA through the NIS Staff shall conduct IA IMT PerformanceEvaluation of all IAs within the coverage of the NIS. This can be done through the assistanceof the Staff of the IMO Operations Section. The completed form will then be submitted to theManager of the Irrigation Management Office (IMO) for consolidation, analysis anddiscussion with the NIS Staff. The results of the IA IMT Performance Evaluation will bepresented and discussed along with the NIA IMT Performance Evaluation done by the IA(s)during the End-Season O&M Review and Planning Workshop with the members of the SMCfor finalization and signing by the members of the SMC. During the workshop, discussionand agreements on what to be done by the NIA and IA(s) to improve their performance andthe NIA-IA partnership will also be done. The results of this will form part of the basis of thesucceeding season NIA and IA IMT Performance Evaluation. The consolidation of the IA IMTPerformance Evaluation will be done using Table 2.

Copies of this report (Table 2) must be submitted along with Table 1 to the Engineering andOperations Division of the Regional Irrigation Office, the Operations Department of theEngineering and Operations Sector and to the Project Management Office of a Projectcovering specific NISs, for review, analysis as basis for provision of technical assistance.

For IAs with Model 1 Contract

Indicators of Performance Criteria Points

A. Organization Performance (25 points) 25

1. Extent of membership (5 points): 0.20% for everypercent membership in excess of 75% ormaximum of 5 points for 100% membership

Points = (Percentmembership –75) X 0.20

5

2. Seasonal financial statements prepared andreported to IA members (5 points)

Yes 5

No 0

3. Established income sharing at different IA levels(5 points)

Yes 5

No 0

4. Established repair and maintenance trust fund(Patubigayan Trust Fund) (5 points)

Yes 5

No 0

5. Preparation of Plans (5 points)

a. Cropping calendar and pattern of plantingPrepared 2

Not prepared 0

b. Water delivery and distributionPrepared 1

Not prepared 0

c. MaintenancePrepared 1

Not prepared 0

1 The IA Functionality Survey has to be revised to consider changes on the IA responsibilities in thenew IMT Model Contracts

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d. IA Budget and Financial PlanPrepared 1

Not prepared 0

C. O&M Performance (40 points) 40

1. LIPA preparation (5 points)Prepared 5

Not prepared 0

2. Operation activities such as discharge or waterlevel monitoring on specific points in the system(5 points)

Done 5

Not done 0

3. Irrigated area percentage (8 points) =(irrigated/planted area divided by theprogrammed area) X 100; 0.40 points for everypercent above 80%; 80% is 0.00 points; 100% is8 and above 100% will have bonus points.

Points = (Actual% - 80) X 0.40

8

4. Benefited area percentage (7 points) = (benefitedarea divided by the irrigated/planted area) X 100;0.35 points for every percent above 80%; 80% is0.00 points; 100% is 7 points.


7

5. Good canal ratio (8 points)= (Length of wellmaintained canal divided by the Total length ofcanals2) X 100; 0.40 points for every percentabove 80%; 80% is 0.00 points; 100% is 8points.


8

6. Functional structure ratio (7 points)= (Number offunctional structures divided the total number ofstructures) X 100; 0.35 points for every percentabove 80%; 80% is 0.00 points; 100% is 7points.


7

C. Financial Performance (35 points) 35

1. ISF Bill Distribution (5 points) (0.25 for everypercent in excess of 80% distributed on or beforeharvest time or a maximum of 5 points;Performance of 50% and below is zero points)

Points = (% ofbills distributed –80) X 0.25

5

2. ISF Collection Efficiency (10 points); 0.25 pointsfor every percentage collection above 60%; 0points for 60% collection; 10 points at 100%collection

Points = (Actualpercentagecollection – 60) X0.25

10

3. IA Viability (10 points) = Total Income/TotalExpenses); 0 points at 0.80 Viability and 10points at 1.0 and higher viability; maximum of 10points

Points = (IAViability – 0.80)X 50

10

4. Repair and Maintenance (RM) ExpensePercentage (10 points); = RM Expense divideby the Total Expenses) X 100; 0.125 points forevery percentage above 60%; 0 points at 60%and 10 points at 100%

Points = (ActualRM Expensepercentage – 60)X 0.25

10

Rating 100

2 Well maintained canal is one that has no excessive vegetation, garbage, and narrowsections due to accumulated sediments

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Equivalent Adjective Ratings

1. Outstanding 95 and above



4. Fair (needs strengthening) 65 to 74

5. Poor (need to be re-organized and strengthened) Below 65

Prepared by:__________________________

SWRFT/IDO

Conforme:__________________________

NIS Office HeadSignature over printed name

For IAs with Model 2, 3 or 4 Contract


A. Organization Performance (20 points) 25

1. Preparation of O&M Plans (5 points)

a. Cropping calendar and pattern of plantingPrepared 2

Not prepared 0

b. Water delivery and distributionPrepared 1

Not prepared 0

c. MaintenancePrepared 1

Not prepared 0

d. IA Budget and Financial PlanPrepared 1

Not prepared 0

2. Extent of membership (5 points): 0.20% for everypercent membership in excess of 75% ormaximum of 5 points for 100% membership

Points = (Percentmembership – 75) X0.20

5

3. Seasonal financial statements prepared andreported to IA members (5 points)

Yes 5

No 0

4. Established income sharing at different IA levels(5 points)

Yes 5

No 0

5. Established repair and maintenance trust fund(Patubigayan Trust Fund) (5 points)

Yes 5

No 0

B. O&M Performance (40 points) 40

1. LIPA preparation (5 points)Prepared 5

Not prepared 0

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2. Operation and Maintenance Activities (5 points)

a. Water distribution activitiesDone Satisfactorily 2.50

Not done 0

b. Repair and MaintenanceDone Satisfactorily 2.50

Not done 0

3. Irrigated area percentage (8 points) =(irrigated/planted area divided by theprogrammed area) X 100; 0.40 points for everypercent above 80%; 80% is 0.00 points; 100% is8 and above 100% will have bonus points.

Points = (Actual % -80) X 0.40

8

4. Benefited area percentage (7 points) = (benefitedarea divided by the irrigated/planted area) X 100;0.35 points for every percent above 80%; 80% is0.00 points; 100% is 7 points.


7

5. Good canal ratio (8 points)= (Length of wellmaintained canal divided by the Total length ofcanals3) X 100; 0.40 points for every percentabove 80%; 80% is 0.00 points; 100% is 8points.


8

6. Functional structure ratio (7 points)= (Number offunctional structures divided the total number ofstructures) X 100; 0.35 points for every percentabove 80%; 80% is 0.00 points; 100% is 10points.


7

C. Financial Performance (35 points) 35

1. ISF Bill preparation and distribution (5 points)(0.25 for every percent in excess of 80% billsprepared and distributed or a maximum of 5points for 100% performance; Performance of80% and below is zero points)

Points = (% of billsdistributed – 80) X0.25

5

2. ISF Collection Efficiency (10 points); 0.50 pointsfor every percentage collection above 80%; 0points for 80% collection; 10 points at 100%collection

Points = (Actualpercentage collection–80) X 0.50

10

3. IA Viability (10 points) = Total Income/TotalExpenses); 0 points at 0.80 Viability and 8 pointsat 1.0 and higher viability; maximum of 10 points

Points = (IA Viability–0.80) X 50

10

4. Repair and Maintenance (RM) ExpensePercentage (10 points); = RM Expense divideby the Total Expenses) X 100; 0.25 points forevery percentage above 60%; 0 points at 60%and 10 points at 100%

Points = (Actual RMExpense percentage–60) X 0.25

10

Rating 100

3 Well maintained canal is one that has no excessive vegetation, garbage, and narrowsections due to accumulated sediments

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Equivalent Adjective Ratings Range

1. Outstanding 95 and above



4. Fair (needs strengthening) 65 to 74

5. Poor (need to be re-organized and strengthened) Below 65

Prepared by:__________________________

SWRFT/IDOConforme:

__________________________NIS Office Head

Signature over printed name

Note: For performance rating of Satisfactory or lower of any or both parties, a NIA-IAconsultation meeting with the participation of other members of the NIS SystemManagement Committee (SMC) particularly the Local Government Unit (LGU)representative shall be conducted to discuss actions to be done to improve theperformance or correct performance gaps of the party concerned.

nia-imt policy 2nd edition

Documents

nia imt program

imt process

ia imt responsibilities

quezon cityinia imt

irrigation service

irrigation system performance

ia compensation

nia charter