Friday, November 07, 2008 Mayor says CH demonstrated transparency in joint venture plan for SRP
CEBU City Mayor Tomas Osmeña challenged Gov. Gwendolyn Garcia and her brother, Rep. Pablo John Garcia (Cebu Province, 3rd district), to be transparent and report to their constituents how much the Capitol has earned from its joint venture (JV) with Ayala Land to develop the Asiatown I.T. Park.
The challenge was posed as Osmeña reacted to criticisms from the Capitol on the City Government’s “lack of transparency” in transactions involving the South Road Properties (SRP).
To point out that the City has demonstrated transparency and caution in seeing to it that the City gets the best deal for its constituents, the mayor compared the proposed JV between Cebu City and Filinvest Land Inc. with that of the Provincial Government and Ayala.
Vidal’s wish
As City and Provincial officials traded barbs, Cebu Archbishop Ricardo Cardinal Vidal said he hopes that before the year ends, both officials will sit down and discuss their issues.
“My Christmas wish is that our leaders would stop all this harsh exchange of words,” said the archbishop, who added that two high-ranking officials fail to set a good example if they keep fighting.
In commercial operations since 1996, the Cebu Property Ventures and Development Corp. (CPVDC) began “as a joint venture corporation between the Province of Cebu and Ayala Land Inc.,” states the Cebu Holdings Inc. (CHI) website.
The same site reports that 76 percent of CPVDC has belonged to the CHI since 1995.
In his first news conference since he arrived from a one-month leave from the US, the mayor also asked how much Congressman Garcia is getting as a member of the board of directors of CPVDC. The mayor said that on the matter of transparency, the City has showed more of it than the Province.
Transparency
“I don’t know of any report from the Provincial Government to their constituents on how much they have earned. I’m just asking… Ang nakalisod nila is they keep asking about our transparency here. Where is the transparency there? A lot of buildings have been constructed, so how much did the Province collect? How much revenue did they get? How much are the directors making?” he continued.
In a separate interview, Pablo John Garcia pointed out that the CPVDC deal was done during the time of former governor Lito Osmeña yet. “The revenues the Capitol got from the deal were well-publicized at that time,” he told Sun.Star Cebu in a text message.
As far as being a director, the third district congressman said he only represented the Province in the CPVDC when he was a consultant, from 2004 to 2007.
“I’m no longer a consultant. As far as the honoraria I received, CPVDC records will show that in more or less three years that I was a director, I probably received less than P40,000 for the entire three years. I declared it in my income tax returns,” he said.
Once Osmeña is done with his “diversionary tactics,” the congressman said the people of Cebu City are “anxiously waiting for” the terms of Filinvest’s offer to purchase and jointly develop SRP lots.
Bidding
Unlike the CPVDC’s sale of IT Park lots, which did not go through a competitive bidding, Osmeña said the City has taken time to adopt the National Government’s guidelines for entering into JV agreements with private entities and intends to hold a bidding for every sale it makes.
“They also went into a joint venture by forming CPVDC, which will develop the property and they will share the profits. With Cebu City and Filinvest, we are not forming a new company, we will just get 10 percent of Filinvest’s revenue whether or not they get profits. In the case of Capitol and Ayala, they have discussions on how much profit was earned. Then there is discretion there,” he said.
Osmeña also welcomed the Commission on Audit’s report that the City topped the list of local government units in the country with the biggest total liabilities, with some P5.739 billion in debts.
The mayor said this does not bother him because while the City has debts, it also has assets, or some 302 hectares of land at the SRP.
“We are number one in debts, sure. So? What’s wrong with debt as long as you have assets? I will make a bold statement that I have never put forward before, and I challenge the National Government to say I’m wrong. The SRP is the best ODA (official development assistance) project the Philippines has ever gotten kay wala sila’y alkanse… (because the National Government doesn’t lose anything) We are the one paying for the loan and nakaganansya pa sila (the National Government makes money),” he said.
Of the roughly P750 million the City shells out each year for SRP loan payments, one-third each pays for the principal and interests to the Japan Bank for International Cooperation.
The other one-third or about P250 million goes to the Department of Finance and the Land Bank of the Philippines for interest payments as guarantor of the loan, he said.
“And the Province brags they’re number one in terms of assets only because of one reason, because their properties are in Cebu City. So why are they proud of it?
That’s not their performance, that’s our performance, if their property is worth P15 billion because of our progress in our city. If their properties were in Barili or Dumanjug, how much would it be worth? Only a few carabaos. I really don’t understand their logic,” Osmeña said.
Relations between the mayor and the governor soured in early 2006, after the collapse of a proposed exchange of land—nearly four hectares in Cebu City’s north reclamation area, in exchange for Province-owned properties occupied by some 5,000 urban poor families and scattered in 11 barangays.
(LCR/With GMD & EPB)
