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Tuesday, September 21, 2004
Among 102 cities, Cebu no. 1 in income, debts
By Gingging A. Campaņa
CEBU CITY -- Cebu City has the highest total net income among 102 cities in the country with P462.5 million.
Ironically, the City also has the highest amount of liabilities at P3.62 billion, representing loans, accounts and expenses payables.
The listing, prepared by the Commission on Audit, which came in the form of a paid advertisement Monday, did not include the 13 cities in the National Capitol Region.
COA's 2003 nationwide ranking showed that while Cebu City, a highly urbanized city, made P462.5 million in 2003, the amount failed to surpass what Davao City earned in the same year.
The list placed Davao City as the highest total gross income earner with P2.2 billion, while Cebu City only had P1.82 billion.
What helped Cebu City clinch the top spot nationwide was its total expenses, which was P1.35 billion, compared with Davao City's P1.96 billion.
Completing the top five highest net income earners were Zamboanga City, P373.53 million; Batangas City, P270.26 million; Davao City, P249.43 million; and Calamba City, P245.85 million.
The balance sheet showed that Cebu City had the most loans among the 102 cities. COA placed its total liabilities at P3.627 billion.
The other cities with huge liabilities include Cagayan de Oro City, P934.77 million; Puerto Princesa City, P724.66 million; Tagaytay City, P608.56 million; and Olongapo City, P530.90 million.
The report, however, did not state the nature of the liabilities.
But COA 7's annual audit report on expenditures for 2003 showed that the City's liabilities already include the loan package from the Japan Bank for International Cooperation (JBIC) for the South Reclamation Project, set to be renamed as the South Road Properties (SRP).
Cebu City got a 12.315-billion yen from JBIC in 1997.
Nothing wrong
Sought for comment, Mayor Tomas Osmeņa said the COA report will give him basis to increase taxes.
He hopes COA will publish more similar reports.
With City Hall's revenues going down to as much as P200 million this year, Osmeņa also said he will likely impose the new schedule of market values on real properties in 2005.
This means that real property taxes will be go up next year because a "revised scheduling will reflect that."
In a separate interview, SRP manager Nigel Paul Villarete said he found nothing wrong with the COA report because the City's fiscal status is not based on the level of its debt but on its ability to pay, the means to pay and the returns that it gets out of that debt.
"Traditionally, it is the National Economic and Development Authority (Neda) which determines the viability of borrowing. Neda approved the City's loan from JBIC. There's a level of a hurdle rate that you have to achieve before you are allowed to incur the debt," he told Sun.Star.
"SRP has a higher rate of return than the other projects in its batch," Villarete said.
He explained that COA's data means the City has posted a huge net income after it has paid its debt amortization for 2003.
"If you looked at it that way, it has one of the healthiest fiscal situation," he said.
Cebu City is still applying for the titling of the 240-hectare SRP and for its registration with the Philippine Economic Zone Authority.
But it is having difficulty with the application because Talisay City has blocked Cebu City's application for patent and titling when it claimed ownership over 53.44 hectares of the SRP.
This is why the City is having a hard time marketing the SRP to investors.
"That is why we are doing something about it," Villarete said.
Villarete, who is also City planning and development coordinator, has been relieved of his administrative duties "so that I can concentrate on the SRP titling and marketing."
(September 21, 2004 issue)
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