Friday, November 21, 2008 Capitol submits letter of intent on SRP bid
FILINVEST Land Inc. (FLI) will not collect even P1 in project development costs from the winning challenger in their offer to develop a 50-hectare portion of the South Road Properties (SRP), Cebu City Mayor-on-leave Tomas Osmeña said.
Osmeña’s message came just minutes before Capitol personnel arrived in City Administrator Francisco Fernandez’s office yesterday morning to deliver a letter from lawyer Rory Jon Sepulveda, Capitol’s consultant on information, revenue generation and compliance.
Sepulveda formally expressed the Province’s interest in challenging FLI’s offer and asked for a copy of the joint venture ordinance. Fernandez provided them with a copy of the measure.
Capitol officials objected to insinuations they were making a “nuisance bid” in their offer to challenge Filinvest’s proposal to develop a 50-hectare portion of the SRP.
Likewise, Cebu Gov. Gwendolyn Garcia surprised members of the media with her dramatic reaction to Osmeña’s calling her “Tandang Zorra.”
“Tomas is no spring chicken himself,” the governor retorted. “In the light of recent events and from what I know, wala na man gani spring, chicken na lang.”
After that statement, Garcia went inside a private room in her office and returned wearing a black cloak while holding a colorful figurine of a chicken.
“By the way, this Tandang Zorra would like to ask the chicken: what’s the real deal about the Filinvest deal? Why are you so afraid of the Tandang Zorra offer? C’mon chicken, are you chicken?” Garcia asked.
Silent
The governor announced she will inspect today the 10-hectare portion of the SRP that Filinvest wants to buy outright.
Even with the mayor’s pronouncement, Fernandez said he will seek the opinion of the National Economic and Development Authority (Neda), the Commission on Audit and other National Government agencies on whether unsolicited proposals are entitled to a project development cost refund, to guide the City on its other transactions.
The Cebu City ordinance and the Neda guidelines on joint venture agreements are silent on project development cost refunds to proponents of unsolicited offers, he said.
Rep. Pablo John Garcia (Cebu Province, 3rd district) earlier described the project development cost refund as a stumbling block for other developers who might want to challenge FLI’s unsolicited proposal.
“Unlike Ayala, which is demanding a refund (P100 million) from the winning bidder, Filinvest will not demand even P1 in refund. So the people of Cebu City are assured of getting the best deal,” Osmeña said in a text message sent from the US, where he is seeking treatment for urinary bladder cancer.
Jewel
He was referring to the Ayala consortium’s proposal to undertake the multi-billion-peso Carmen Bulk Water Supply Project.
Fernandez said the mayor-on-leave discussed the matter of the project development cost refund with FLI officials, and sent reporters text messages on FLI’s decision.
Another letter from the Capitol was delivered in the afternoon, this time informing the Cebu City administrator of Governor Garcia’s visit to the SRP this morning, and asking for someone to accompany the governor’s party.
“I would have wanted to receive Governor Garcia myself but I have an early morning meeting in Lapu-Lapu City, so it will be the SRP manager who will receive her... As governor, she’s very much welcome and even if they are not interested in investing at the SRP, we will be happy to welcome the governor and show off to them our jewel,” said Fernandez.
Fernandez is the chairman of the Joint Venture Selection Committee (JVSC), which was tasked to negotiate with FLI on its unsolicited proposal to buy 10 to 13 hectares of waterfront properties at the SRP amounting to some P2 billion.
It also plans to invest some P80 billion to develop 40 hectares into a condominium complex under a joint venture agreement with the City.
Challenge
If the negotiations succeed, FLI’s unsolicited proposal will be open for a competitive bidding scheduled next month and if there are no challengers, the awarding of the contract is set on Jan. 17.
Fernandez and SRP Management Office Head Nagiel Bañacia said the bidding process will be more lengthy if other developers challenge FLI’s bid, since the latter will be given a chance to review their proposal and challenge the bid of other interested investors.
He welcomed yesterday the pronouncement of Osmeña that there will be no development cost refund.
Based on his review of the joint venture ordinance and the Neda guidelines on joint venture agreements, Fernandez said there was also no mention of such a refund.
“So we hope they will maintain that position so we will not have to discuss this in the future. We are grateful that they have taken away the burden of deciding whether or not there should be a refund. But still, we have to clarify this with some agencies, if unsolicited proposals are entitled to a project development cost, to avoid problems in
the future,” Fernandez added. (LCR/With GMD)
