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Tuesday, December 23, 2008
Capitol 'cannot bid' for SRP project
THE Cebu City Joint Venture Selection Committee (JVSC) declared on mass motion Monday that the Provincial Government is not eligible to challenge the unsolicited proposal of Filinvest Land Inc. (FLI).
For the JVSC, the Province, the lone participant in the bidding, is not a private entity and therefore not covered by City Ordinance 2154, or the "ordinance prescribing the guidelines for entering into joint venture agreements with private entities."
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The Province's eligibility requirements were also incomplete and not submitted on time, the committee members said during the opening of bid requirements at City Hall Monday afternoon.
Lawyer Rory Jon Sepulveda, Capitol consultant on information and revenue generation, said they have yet to receive communication from City Hall on the matter.
He said the Province may file a motion for reconsideration after a thorough review of the City Government's decision.
Capitol, he added, would only "love" to challenge FLI's offer and come up with a competitive joint venture proposal on South Road Property lots.
City Administrator and JVSC chairman Francisco Fernandez said that the Province will be given a chance to file a motion for reconsideration.
Capitol has seven days to submit its motion to the mayor.
Requirements
"Our official stand is that we disqualified them because they are not a private entity and our jurisdiction, according to the ordinance, is only private entities," Fernandez told reporters Monday.
"Granting without admitting that they are qualified, they were late in submitting their eligibility documents. Yet we still continued with the procedure and opened their documents and we found that it was incomplete... (We) had no choice but to disqualify them," he continued.
At least five other documents were not submitted because only private entities were expected to apply for eligibility, such as articles of incorporation and latest tax returns.
"In fairness and respect to the Province, there were many requirements that they did not comply with, so it's not only because they are not a private entity. Even for the financial requirements, they did not meet the minimum equity needed," said Acting City Treasurer Rene Empaces, also a JVSC member.
Capitol has not also completed the development of a contiguous project of at least 35 hectares costing at least P10 billion, and failed to submit proof or ability to provide a minimum amount of equity, which is pegged at P25 billion in the FLI proposal.
A letter informing Gov. Gwen Garcia of their ineligibility was drafted Monday and will be delivered Tuesday.
Documents
The JVSC has set the deadline for submission of eligibility requirements at 11 a.m. Monday.
At 11:30 a.m., a Capitol representative submitted to the bids and awards committee secretariat the Province's second supplemental budget on funds availability and utilization of development funds report for 2005, and statements of funds operation from 2005 to 2009.
Three hours later, the Province submitted its Build-Transfer-Operate agreement with Fifth Avenue, its joint venture partner for their planned Ciudad development project.
Balance sheets, statements of cash flow and statements of income and expenditures for 2005 to 2007 were also submitted.
The documents, however, were not audited and marked received by the Bureau of Internal Revenue, as required in Ordinance 2154.
Not covered
But for a member of the JVSC Technical Working Group (TWG), the validity of Capitol's eligibility documents was no longer an issue.
"I think we should not discuss matters other than the nature of the entity, whether it's a private or government entity. If that's a government entity, then outright, they are disqualified," said lawyer Alan Gaviola of the TWG.
"So there is no point in dealing with all these qualifications, whether they submitted this or that because we are talking about jurisdiction, whether we have jurisdiction over the proponent," he said at the opening of the eligibility requirements.
After the title of the ordinance was read, the committee agreed that local government units (LGUs) are not covered by the measure and cannot participate in the bidding.
Former city administrator Juan Saul Montecillo, vice chairman of the JVSC, raised a motion to "declare the Province ineligible to participate because it is not a private entity," which was seconded by JVSC member and City Engineer Nicomedes Leonor and was passed on mass motion.
The matter will also be referred to the City Council for approval.
Negotiations
FLI has submitted an unsolicited proposal for an unincorporated joint venture with the City Government over a 20-year period, which will provide infrastructure facilities, buildings and other amenities in a central business district type of development involving the construction of 875,000 square meters of building space over a 50.6-hectare area of the SRP.
The firm intends to invest at least P25 billion in the project, which will include "mid-level to ultra high-end" residential buildings, a medium-rise complex, a cluster of high-rise hotels, retirement and medical facility and commercial areas.
While the bidding process is ongoing, Cebu Investment Promotions Center (CIPC), marketing arm of the SRP, is finalizing negotiations with SM Prime Holdings Inc. and the Pueblo de Oro consortium for the sale of other areas of the SRP.
CIPC managing director Joel Mari Yu said that negotiations with SM is on its final stage, but no other proposal from prospective buyers will be put up for bidding until the FLI proposal is awarded to the winning bidder.
"It's just that we want to prioritize. We are concentrating all our efforts and resources to make sure the FLI proposal pushes through. We prioritized the FLI offer because they are the first to comply with all the documents," Yu told reporters Monday. (LCR/GMD)
For more Philippine news, visit Sun.Star Cebu. (December 23, 2008 issue)
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