Cebu City has spent more than its income in the past two years, a news headline says. Reports have it that in the past two years, 2020 and 2021, the City spent more than P10 billion, way below its income of P8.7 billion. But I don’t suppose that the City’s taxpayers would mind the spending if the money was spent for the community’s good and did not go to the wrong pockets.
The huge spending could also be attributed to the Covid-19 pandemic that hit the country for the past two years. There were not many economic activities because of the lockdowns to prevent the spread of the coronavirus. But has there been an accounting of the City’s expenditures for the Covid-19 pandemic?
The City’s local finance committee (LFC) reported that the City spent over P10 billion but its income in 2020 was only P8,730,467,421.31. The income further went down to P7,363,119,186.93 in 2021. Perhaps it was out of respect to the previous administration that the LFC did not reveal the details of how the more than P10 billion was spent. Since Mayor Michael Rama wants transparency in his administration, the LFC should have detailed in its report how the more than P10 billion was spent in the last two years.
Last year, according to the report, Cebu City had assets of more than P33 billion, but with liabilities of over P17 billion and equity of about P15 billion. The LFC’s financial performance report showed that the sales from the South Road Properties (SRP) was one of the sources of funds for the years 2020 and 2021 at P3,739,333.600 and P5,512,793,219.97, respectively.
The financial reports indicate that when Rama assumed a fresh mandate as the City’s mayor after the May 2022 general elections, he was left only with crumbs in the amount of P4.5 billion, which may not be enough for the first 12 months of his term and to fund his huge dream of a Cebu City like Singapore. Ambitious, but doable.
The P4.5 billion City funds that the previous administration left behind would not even be enough to pay the City’s P8 billion payables, the report stated. I don’t think that LFC’s recommendation to increase the City’s taxes on real property, business, fees and other charges would be good for the image of the City mayor, who won over a formidable opponent, former councilor Margot Osmeña, the better half of former mayor Tomas.
The LFC also recommended to revisit the ordinances and contracts under joint venture agreements and the list of properties auctioned and sold to the City will have to be reviewed if these could be offered for lease or sale to the public. Disposing of the remaining assets of the City would not be good because at the end of the day, the City would become homeless without its assets.
Rama’s secretary, lawyer Collin Rosell, explained that the City would have saved something like P1 billion if the remaining balance of the City’s loan on the SRP was paid by the previous administration. But even with the current financial position of the City, Rama’s trusted financial advisors are confident the City would bounce back and regain its high economic status under his administration.
I am one of the many Cebuanos interested to know how the more than P10 billion was spent in the years 2020 and 2021 not because we’re “Marites” as the viral joke goes, but as taxpayers we want to know how the taxes we paid are spent by the government managers.