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Thursday, March 16, 2006
CH hopes to raise P575M from lot sale to pay SRP debt
By Gingging A. Campaña
Sun.Star Staff Reporter
Cebu City Hall will bid out some 4.6 hectares of its property in the North Reclamation area to help pay for its loan from the Japan Bank for International Cooperation (JBIC) to build the South Reclamation Project (SRP).
If it sells about 46,000 square meters at P12,500 per square meters at the minimum, the City can earn close to P600 million by the yearend.
The payment should be made in cash.
“What’s the problem? That’s a fact. It’s not a misinterpretation. I got PEA’s (the Public Estates Authority’s) approval for us to sell it. It was due to be sold. We ran into a so called deficit because we did not sell it,” Mayor Tomas Osmeña told a news conference yesterday.
Osmeña also announced that the “Cebu South Coastal Road is certified to withstand more load than any road in Cebu except that of the Mactan runway.”
He said the road can carry 40 tons.
The mayor was reacting to reports that vibrations can be felt whenever a heavy cargo truck passes the SRP.
“It is rated for 40 tons even with bumper-to-bumper traffic. Even the viaduct, you fill all the lanes with trucks nothing is going to happen. There is no risk at all,” Osmeña said.
“There is a possibility that you would feel some vibration when a heavy truck travels at a hundred kilometers per hour, which they travel sometimes, but it’s not going to collapse. It’s very hard for a road to collapse,” he further said.
The City Government is paying P600 million in amortization this year to the Land Bank of the Philippines, JBIC’s conduit, for the SRP loan.
For the 12.292-billion yen loan that was obtained almost a decade ago, Cebu City has to pay P6.3 billion, at today’s exchange rate.
Last February, the City paid 581 million yen or P267 million to the Land Bank of the Philippines before its due date.
According to Land Bank’s loan amortization repayment schedule until 2025, the payables could hit P10.16 billion, including the interest and guarantee fees.
But if City Hall is able to pay in advance a huge portion of its principal, its payables might amount to less than P10 billion by 2025.
By the time the City Government sells the lots at the North Reclamation Area, all the offices of the City’s extension offices will have to be transferred, including the Department of Engineering and Public Works, the Department of Public Services, the Mobile Patrol Group, the City’s depot and garage.
That’s why the mayor wanted to include in the terms of reference that City Hall be allowed to use the property for two years even if it is already sold and transferred to the buyer’s name.
This way, the City will have enough time to transfer its offices.
For Bisaya stories from Cebu. Click here. (March 16, 2006 issue)
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