Saturday, June 28, 2008 COA allows lot sale in NRA
AFTER two years of waiting, the Cebu City Government can now finalize the sale of a North Reclamation Area (NRA) lot worth P570 million after the Commission on Audit (COA) declared the bidding to be aboveboard.
The City Government can now collect the balance of some P400 million from the buyer of the property, Robinson’s Land Corp. (RLC).
In an eight-page decision, COA authorized the final sale of the 4.6-hectare City Government property after three independent appraisers they commissioned validated the City’s selling price of P12,500 per square meter.
The City Government’s appraisal committee has appraised the lot at P11,530 per square meter in January 2006.
‘Undue favoritism’
However, in September 2007, COA 7 Regional Technical Services Office’s appraised the property to be worth P15,500 square meter, raising suspicions on irregularities in the bidding and undue favoritism when the City awarded the sale contract to RLC.
In a decision dated June 5, 2008, COA Acting Chairman Reynaldo Villar said the commission “interposes no objection to the contract to sell entered into between the City of Cebu and RLC at P12,500 per square meter.”
“The recommendation of the bids and awards committee to award the contract to RLC should be respected due to its technical expertise to determine the offer that will best meet the requirements of the City of Cebu, and should be deemed aboveboard, there being no evidence to prove suspicion of favoritism and anomalies in the execution of the said bidding,” he said.
“That price was, therefore, obtained as a direct result of a fair play in the market by the parties concerned. In the absence of competent proof or irregularities in the bidding and negotiation, it would be the height of unfairness to declare the price so obtained as unreasonable, just because COA came up with a different valuation,” Villar continued.
Collection
With the COA decision, the City can now collect the P400 million balance from RLC by second week of July, which will be declared extra income for the City this year.
City Administrator Francisco Fernandez received a copy of the decision last Thursday, and immediately set an appointment with RLC’s representatives on July 7 for the signing of the contract to sell, the deed of sale and the awarding of final payment and lot titles.
Mayor-on-leave Tomas Osmeña has been waiting for COA’s clearance, which has kept the City from finalizing the sale of the property and collecting some P400 million from the Gokongweis.
“The City and the Gokongweis have been waiting for a long time for this decision. They have always been ready to pay but without COA’s approval of the selling price, we cannot do anything. So now I can make arrangements for the collection of payment,” Fernandez told Sun.Star Cebu.
Approved
In June 2006, the City Council had approved the contract to sell the 46,345-square-meter property at the NRA. The value of the property was pegged at P12,500 per square meter or a total of P579,312,500.
The property was sold to RLC under a negotiated purchase after two failed biddings in April 2006. Only Robinson’s Land joined both biddings, where it put up a bid bond of P115.86 million as down payment for the property.
But because of questions raised by a COA division on the contract price, which some commission officials reportedly said was too low, the property was subject to at least three appraisals by COA.
Three independent appraisers declared the property’s value to be at P12,500, P12,580 and P12,780, which is within the allowable 10 percent price variance.
Once they have the money, Fernandez said they will find out how much of the P400 million is available to be used for pending projects and programs of the City Government. (LCR)
