Mayor gets approval from City Council

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Thursday, August 14, 2014


IN a 9-7 vote, the Cebu City Council authorized Mayor Michael Rama yesterday to negotiate and dispose of 45.2 hectares of the South Road Properties (SRP).

Councilor Gerardo Carillo, who introduced the resolution, said the move would allow City Hall to pay in full for the loan it obtained in 1995 to build the SRP.

He also said it did not mean that the Bando Osmeña Pundok Kauswagan (BOPK) councilors who supported the move are now allies of Team Rama.

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The move authorizing the mayor to sell SRP lots was earlier supported by 10 councilors, but Councilor Eugenio Gabuya Jr. decided to back out.

Gabuya was among the 10 councilors who had drafted and signed the joint resolution.

The others included Councilors Carillo, Noel Wenceslao, Roberto Cabarrubias and Richard Osmeña of the BOPK and Councilors Hanz Abella, David Tumulak, Mary Ann delos Santos and Philip Zafra of Team Rama.

Gabuya, together with Councilors Sisinio Andales, Alvin Dizon, Lea Japson, Nida Cabrera, Nestor Archival Sr. and Alvin Arcilla objected yesterday to the move to authorize Mayor Rama to sell SRP lots.

When he introduced the resolution in the regular session, Carillo said the BOPK-allied councilors wished “to inform the public and the media” that their sponsorship of the resolution did not mean a “TOA or transfer of affection.”

It only means, he added, that “the council can always set aside political color.

Whether yellow or green, if it calls for the greater good for the Cebuanos, the City of Cebu and this representation can assure the public of the independence of this august body.”

Carillo proceeded to explain the need to sell SRP lots, including the ability it would give the City to pay back its SRP loan.

The City still has a balance of P3.2 billion out of the 12.315-billion yen loan it availed itself of from the Japanese International Cooperation Agency to implement the SRP. At yesterday’s exchange rate, the original loan was equivalent to P5.2 billion.

Loan payments started in 1995 and are supposed to end in 2025.

Revenues

Carillo said the sale of 45.2 hectares in the SRP is expected to generate at least P12
billion, at P20,000 per square meter.

That’s more than enough, he pointed out, for the City to pay back its loan fully.

Carillo said the surplus can be used to cover the senior citizens’ financial assistance, fund the City’s scholarship program and implement other priority projects.

Based on the resolution, the properties to be sold are Lot 7 and Lot 17, with an aggregate area of 19.2 hectares, as well as Lot No. 8, covering 26 hectares. Lot No. 8 is the property where the San Pedro Calungsod templete stands.

Once these lots are sold, the councilor also said, the City can generate an additional P2 billion, with P1.5 billion in real property taxes and P500 million in regulatory fees.

Carillo then said the only question is how to dispose of the property.

Bidding

He explained to the council it would be proper to hold a public bidding because several interested bidders have surfaced, among them SM Prime Holdings Inc., Filinvest Land Inc., Robinsons Inc. and Megaworld Corp.

“It is my submission, for the sake of transparency and accountability, that the competitive bidding must be conducted,” he said.

The councilor, who is a lawyer, also pointed out Section 379 of the Local Government Code, which provides that the primary mode of disposing of government assets must be public auction.

Following his explanation, Carillo moved for the approval of the two-page joint
resolution.

However, nobody seconded his motion, which prompted Vice Mayor Edgardo Labella to call for a recess. Labella explained that a proponent cannot second a motion.

Withdrawal

When the session resumed several minutes after, Zafra decided to withdraw as co-author of the resolution, then seconded Carillo’s motion so that the resolution could be discussed.

Gabuya also withdrew also his sponsorship of the resolution.

Asked why, Gabuya said he wanted the resolution fully discussed and studied, adding he has several questions, particularly on the mode of disposition of the SRP lots.

Councilor Andales then moved to reconsider the measure’s approval and asked if it has already been referred to the City Legal Office for their opinion.

Gabuya and Japson raised the same point, with Japson asking for a one-week deferment of the resolution's approval.

Opinion

Carillo, however, said there is no longer a need for a legal opinion. He invoked a provision in their House Rules, which states that only contracts, undertakings and memoranda of understanding should go through the legal office.

Also, he pointed out that the resolution merely authorizes the mayor to negotiate for the sale of the SRP lots. The contract for the sale, he added, will have go back to the council for final approval.

Because of the discussion, Zafra moved to divide the house, and nine councilors voted in favor, while seven voted against the resolution.

Mayor Rama, in his regular news conference, welcomed the support of the BOPK councilors on the sale of the SRP lots.

“I am so elated and very much surprised. I am really thanking them,” he said.

If the sale pushes through, it would be the first time in Rama’s two terms as mayor—the council having blocked previous attempts.

For his part, former mayor Tomas Osmeña, who heads BOPK, said in an earlier interview that he was not consulted on the move of the BOPK councilors to allow the mayor to sell some SRP lots.

“Usa sa ilang tiil, tua na sa pikas tingali (Perhaps they already have one foot in the other camp),” he said.

Published in the Sun.Star Cebu newspaper on August 14, 2014.

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