SECTIONS
philippines
Monday, December 06, 2021

Capitol share in joint venture questioned

THE Commission on Audit (COA) questioned what the Capitol will get from a joint project with Filinvest Land Inc. (FLI).

In its annual audit report, COA noted that the income generated from the business process outsourcing (BPO) tower in Barangay Apas is just enough to pay realty tax that will be imposed on the Cebu Provincial Government.

The tower is a joint venture between FLI and the Capitol.

COA also noted that the delay in removing the concrete fence that enclosed the BPO tower, which resulted in “the loss of rent income, which is equivalent to two percent of the 90-percent projected gross revenue or P500,000 per month, whichever is higher.”

The COA 2014 report stated that the annual real property tax on the property is P12 million while the lot rental and the percentage share from office rental amount to P1 million a month.

“The benefit that the Cebu Provincial Government would derive from the build-transfer-and-operate (BTO) agreement with Filinvest Land Inc., may just be sufficient to pay realty taxes,” state auditors said.

Provincial Administrator Mark Tolentino said that the amended memorandum of agreement with Filinvest made all COA observations “moot and academic”.

Tolentino said that FLI will shoulder the taxes, and the wall that enclosed the BPO tower was already removed, in a ceremonial demolition last July 3.

The demolition also opened additional access points in the Cebu Asiatown IT Park.

According to COA, the BTO agreement between Capitol and FLI was signed on March 26, 2012 for the company to construct, develop and operate the BPO complex.

The COA report quoted the agreement, which stated that the project must be operational on or before Dec. 1, 2013.

The agreement further stated that if the project is not yet operational by that time, the Province will collect P500,000 from FLI every month, or an amount equivalent to two percent of the projected revenue.

style="display:block; text-align:center;"
data-ad-layout="in-article"
data-ad-format="fluid"
data-ad-client="ca-pub-2836569479021745"
data-ad-slot="1977900730">


VIEW COMMENTS
DISCLAIMER:

SunStar website welcomes friendly debate, but comments posted on this site do not necessarily reflect the views of the SunStar management and its affiliates. SunStar reserves the right to delete, reproduce or modify comments posted here without notice. Posts that are inappropriate will automatically be deleted.


Forum rules:

Do not use obscenity. Some words have been banned. Stick to the topic. Do not veer away from the discussion. Be coherent. Do not shout or use CAPITAL LETTERS!