Saturday, October 16, 2021

EXPLAINER: Suspected multimillion-peso loss prompts Cebu City Council to seek multi-agency probe on garbage payment. ‘Plunder... alleged plunder,’ says Rama.

CEBU. City Councilor Nestor Archival, the Binaliw landfill and Docast Construction. (File photos)

AT A GLANCE, WHAT’S UP. The Cebu City Council Thursday, August 19, in a resolution passed without objection, asked the Visayas Ombudsman and the National Bureau of Investigation (NBI) and police, with Commission on Audit (COA), to investigate suspected overcharging and bloating of figures in the payment for garbage hauled by a private contractor.

Vice Mayor Michael Rama, back as presiding officer, at the start of the special session harped on transparency and accountability and the need to stop irregularities, “if any,” in the garbage management.

Early on and repeating the same theme in the course of the session, Rama talked of turning the case to investigative agencies such as the ombudsman and the police and NBI because the Sanggunian had already spent a lot of time on the issue that already caught public attention. This is “plunder...allegedly,” he said more than twice.

‘SHUTOUT.’ A wrinkle in Thursday’s final public hearing on the garbage controversy was that the Saggunian chose not to listen to a representative of private contractor Docast Construction/JJ and J Construction and General Supply, who was among the persons invited to the session. It terminated the discussion and passed the resolution with the Docast/JJ and J side not being heard.

Minority Floorleader Nestor Archival told SunStar Friday, August 20 they already had “sufficient facts and information” to support the City Council decision to refer the case to independent agencies. “The contractor can explain its side there.”

FIGURES DIDN’T MATCH. One: The volume of garbage hauled by Docast/JJ and J (the service contractor) -- with Department of Public Services (DPS) and the barangays -- to the Barangay Binaliw landfill owned by ARN Central Waste Management did not match with the amount paid to the service contractor. The increase of tonnage from an average of 360 tons daily to 1,000 or more tons per day alerted the Sanngunian in its August 13 special session.

For a total of 72,747 tons of garbage received at the landfill from January 1, 2021 to May 31, 2021, at P1,800 per ton, Docast should’ve been paid only P130.9 million. It was paid P250 million, said Councilor Archival.

Two: If the garbage hauled by DPS and the barangays (totaling 37,709 tons or 2,000 tons more than what Docast/JJ and J hauled) were removed from the claimed volume of garbage deposited at ARN, the City would’ve paid for 35,038 tons only P63.06 million.

‘DISADVANTAGEOUS, VIOLATED’ CONTRACT. Along with the suspicion of padded figures, there’s the belief among some Sanggunian members that the contract or terms of reference in the purchase order are faulty and have been violated.

The fault could be the “integration” of payments, in which one private contractor collects the fees, without regard to the service being provided partly by DPS and the barangays. “Bale tanan sa Docast,” said DPS operations chief Grace Luardo at a previous session of the Sanggunian. “Giluto ta sa atong kaugalingong mantika (we’re cooked by our own lard),” VM Rama repeated last Thursday his earlier remark about the “centralized” system, instead of the old “chop-chop” way.

Besides, many provisions were violated allegedly by the private contractor Docast/JJ and J, including failure to provide the agreed number of trucks and a motor pool and two transfer stations. Rama, the acting mayor at the time, wrote two letters (on June 28 and July 26) to Docast/JJ and J about the violations and its failure to pay an P18 million debt to ARN, which resulted in stoppage of the Binaliw landfill service.

‘BAHAW,’ PRO-BONO. Not helping the case of those managing the garbage deal and payments for the purchase order were these disclosures in the last August 19 session:

(1) A representative of Jomara, which handled the contract in 2020, said it had completed its obligation to the City and cleared the transfer site in Inayawan, Cebu City and was given a certificate of completion by DPS. That seemed to belie the earlier claim of DPS chief Atty. John Jigo Dacua that the high numbers in garbage hauling were caused by seven months' worth of left-over (“bahaw”) garbage by Jomara.

(2) The payment of about P75 million to Docast/JJ and J

last February 15 when its contract took effect only on February 29. Dacua’s explanation: DPS allowed the collection because it was “pro bono.” If it was for free, the City still paid for it.

ONLY P62M LEFT UNPAID. OIC City Treasurer Mare Vae “Ivy” Reyes told the councilors that the City already paid Docast/JJ and J the total of P295 million. The last check was for P28.46 million, released last July 5, before the city treasury was asked by the Sanggunian to suspend payments to the service provider. Thus, out of the P357 million in the purchase order (from a P420 million outlay) for Docast/JJ and J, only P62 million was left to pay for garbage collection the rest of the year.

The figures provided by an ARN representative at the Sanggunian August 19 session covered only the first five months of 2021. Starting last June 1, ARN stopped receiving garbage from Docast/JJ and J because of its unpaid debt and the contractor used a landfill in Consolacion, Cebu town instead.

SUSPICION OF OVERPAYMENT. Based on the figures presented by ARN and the amount already paid to Docast/JJ and J, suspicion of overcharging and padding of numbers tended to be confirmed. The City Council wanted to find out through a series of hearings if its suspicion was correct.

Thus, the resolution for the multi-agency investigation.

Councilor Alvin Dizon, asked by VM Rama as to what the City Council must do, said any anomaly in the time of the pandemic is “unacceptable” and hair-raising (“nanlimbawot akong balhibo”). Councilor Joel Garganera said an inquiry by independent investigative bodies will take away suspicion of political motive.

‘TAMPERING, FAULTY’ CONTRACT. If the figures presented by ARN are correct, then the numbers that supported the claim for payment by Docast/JJ and J must have been tampered with to support the amounts paid out.

That would mean the system of checking the weight of hauled garbage failed or the numbers were fixed to match the Docast/JJ and J billing. Something must have gone wrong along the billing-payment trail -- from ARN to DPS, then to treasury and accounting.

The multi-agency inquiry may prove or debunk that theory.


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