THE Cebu City Legal Office is asking the Department of Budget Management (DBM) to declare the City Government's second supplemental budget (SB 2) for 2014 as operative.
City Legal Officer Jerone Castillo, in his letter to DBM 7 Director Carmela Fernan dated April 6, 2015, said that the City has never faced the same problem in the previous years.
DMB disqualified the retained operating surplus and reversion of accounts as sources of fund in the 2014 SB 2.
But Castillo said these were approved in previous years, as in the case of the City's 2013 SB 2.
"It is worthy to mention that from 2005 to 2013, this honorable office has consistently allowed retained operating surplus and revision of accounts payable as sources of a supplemental budget," Castillo stated in his letter.
In February this year, DBM rendered that the bulk of the City's P405.55-million SB 2 is inoperative, ruling that the fund sources do not fall within the scope of funds actually available or funds that are deemed available as defined under the law.
Under the 2014 SB 2, the City appropriated P243.72 million for the general fund but DBM ruled that P241.52 million of this is inoperative. The sources of fund are: 2013 retained operating surplus of P211.27 million and 2011 reversion of accounts payable worth P30.25 million.
Under the same budget appropriation is the P161.83-million for special accounts, wherein P45.35 million was declared by DBM as inoperative, which is sourced from the 2013 retained operating surplus.
According to a primer on the DBM website, when a budget is declared inoperative, it is returned to the local chief executive to be adjusted, and the treasurer is directed not to disburse any funds from that budget.