Saturday, March 17, 2007 MCWD won’t raise rates of water for next 3 years
WHILE it is still in negotiations with the proponents of the Carmen Bulk Water Supply Project, the Metropolitan Cebu Water District (MCWD) said it will not implement the remaining three-year water rate increase schedule that is supposed to begin this July.
MCWD general manager Armando Paredes said the water district’s negotiations with the Car-men water project proponents, the consortium of Manila Water, Stateland and Vicsal Development Corp., are stuck on the issue of development cost reimbursement.
“The three-year increase (schedule) is tied to the Carmen water project. Since we don’t know when and if the project will push through, we will not impose it (increase),” he said in an interview.
Cebu City Mayor To-mas Osmeña welcomed MCWD’s decision to suspend the implementation of the 12 percent increase in water rates until the Carmen water project is approved.
“That makes sense to me because the Carmen water deal is not self-liquidating that they have to increase even when it’s not implemented yet. If it doesn’t push through, then there’s no justification to increase the water rate,” Osmeña said yesterday.
Paredes said MCWD is supposed to begin imposing a 12-percent increase each year for three years to pay for water supplied by the Carmen water project.
But he said MCWD and Carmen project proponents cannot agree on the reimbursement of development costs supposedly incurred by the consortium in studying the feasibility of tapping the Luyang River in Carmen.
In case it does not win the price challenge on the implementation of the bulk water supply pro-ject, the consortium wants to be reimbursed by the winning bidder for development costs that it (consortium) claimed to have incurred.
Unresolved issues
MCWD, Paredes said, does not agree to this and has refused to include this condition in the draft project contract.
In a news conference yesterday, Osmeña said he will not rush MCWD into approving the Carmen water project as proposed by Ayala Corp.
With some unresolved issues on the negotiations for the water deal and the increasing demand for water in the northern localities in MCWD’s franchise area, the water district is now inclined to conduct an open source bidding for additional water supply, he said.
An open source bidding will allow water suppliers to develop their own source and make their proposal to supply water to MCWD.
The MCWD Board also considers proceeding with its own development projects if Ayala Corp. decides not to push through with the bulk water supply proposal.
“I understand that MCWD is more inclined to do an open source bidding. I think they’ll do that very soon. The Carmen water deal is just not acceptable and they should understand that,” the mayor said.
MCWD had hoped to conduct the Swiss Challenge on Ayala Corp.’s P2-billion water project last October yet but up to this time, the proponent’s demand to be reimbursed of its P156-million project development cost still has to be settled. (LAP/LCR)
