Thursday, July 31, 2008 Mandaue starts paying for loan
MANDAUE City Hall already began paying its monthly amortization for the P379 million it borrowed for the construction of the public market.
But the project engineer cannot yet determine when the construction will be completed. The project is still 90 percent done.
Opposition councilors were earlier quoted as saying that the City is now paying for something that is not yet earning.
Last July 28, the City paid P4.9 million to the Development Bank of the Philippines (DBP), said DBP senior assistant vice president for Central Visayas Luisalo Caberte.
The P2.26 million, paid monthly, will pay for the loan’s principal amount and the P2.73 million for the interest.
15 years
Caberte said the City and the bank agreed that the loan will be payable in 15 years. The loan amortization rate will remain the same throughout the payment period, but the interest rates and loan principal will decrease.
City Administrator Briccio Boholst said he already knew about the payment but cannot elaborate on the details.
The proposed public market at the back of the City sports and cultural center complex is funded partly through a loan and through allotments from the Department of Public Works and Highways (dpwh).
Portions
Young Builders Corp. handles the portion of the project funded by the P379-million loan, while the Mandaue City Engineering Department takes charge of the portion funded by the DPWH’s P80-million budget.
The project was set for completion by the end of the year but Mandaue City Project Engineer Maria Teresa Tibon said the other day that they cannot yet determine the
exact date. Tibon is not sure if they could open before Christmas.
She said it takes time to process funds from the DPWH.
The delay prompted them to suspend the work of Young Builders Corp., now 90 percent complete.
But there are portions covered by Young Builders that are “contiguous” with portions funded by DPWH. Young Builders cannot proceed with the work until the DPWH-funded portion is done, Tibon said.
DBP has released 78 percent of the total loan amount or P298 million.
Caberte said that the loan releases, through progress billing, must not be more than the contractor’s accomplishments or bank officials will be charged.
He wanted to reassure City Councilor Beethoven Andaya, who earlier expressed apprehension that the loan may be released at amounts larger than the work completed so far.
The City Council also expressed apprehension over the slow processing of funds at the DPWH.
Tibon, for her part, said she cannot estimate how long it will take for their liquidation reports to be processed.
The DPWH, she added, observes a strict process before funds are released. Once these are released, the City makes a purchase request, organizes suppliers for bidding, awards and then implements the project.
All the documents involved in the procurement process will then be attached to the liquidation report to be submitted for the next fund allotment. (OCP)
