Council: City can’t use SRP sale funds

THE Cebu City Council has approved a resolution to bar the City Government from spending the money from the sale of South Road Properties (SRP) lots to a consortium.

But a councilor said the resolution would place the legislative body in a “funny” position after the court has cleared the path for the use of the proceeds of the sale in 2015 to the consortium of SM Prime Holdings Inc. and Ayala Land Inc. (SM-Ayala consortium) and Filinvest Land Inc. (FLI). The consortium won in a public bidding for a 45.2-hectare SRP lot.

Councilor Sisinio Andales sponsored the resolution “confirming and affirming that the two Negotiated Sales on Installment dated Aug. 7, 2015 of the SRP lots are deemed void in relation to Resolution No. 14-1607-2019.”

During deliberation, Councilor Raymond Garcia said the move will just make the City Council a laughingstock. “There is already a valid contract being consummated, and the only entity to declare it as void is the courts of law. We have no jurisdiction on this. Mamahimo tang kataw-anan ani (We will look funny),” Garcia said.

Earlier, the Court of Appeals upheld a lower court’s decision that the sale of a portion of the SRP to the consortium was legal and the contracts binding. This means the Cebu City Government now has at its disposal the P8.35 billion the consortium of developers had paid for the development of a portion of the SRP. Of the 45.2 hectares, the SM-Ayala consortium bought 26.3 hectares while FLI bought 19.2 hectares. The buyers initially paid P8.3 billion to the City, out of the P16.76 billion total sale price.

Councilor Jocelyn Pesquera said the City Treasurer’s Office (CTO) already confirmed that the City has used the interest of the payments in some appropriation ordinances. If the Council would declare the sale void, Pesquera said, some of the appropriation ordinances would not be funded and this would make the councilors liable.

But Andales, an ally of outgoing Mayor Tomas Osmeña, said there was no such statement by the CTO that the interest was already used by the City. He also said the Court of Appeals decision was not final and executory and the money should not be used until there is final judgment.

Garcia, Pesquera, Garganera and Councilor Pastor Alcover Jr. voted against the resolution, while Councilor Dave Tumulak abstained. A majority vote approved the resolution. It was the fourth time Andales had sponsored a resolution pertaining to this sale. (RVC)