THE Commission on Audit (COA) found the P540-million payment to contractors for 58 infrastructure projects between 2008 and 2011 in Cebu Province illegal.

It said the transactions were not authorized by the Provincial Board (PB).

“In as much as the subject contracts could not be traced to any budgetary document to which they supposedly pertain, then the appropriations therefore and the resulting disbursement by reason of the appropriations were illegal and must be disallowed with the officials responsible for the payment to be held liable for the disallowances,” read COA’s audit report.

“If we pay, it’s illegal disbursement. Therefore, we are liable,” said Vice Gov Agnes Magpale after PB Member Grecilda Sanchez read the item in the COA report in last Monday’s session.

The projects in COA’s list include the P97.8-million Danao Provincial Hospital, the P58.3-million Balamban Provincial Hospital and road rehabilitation projects in the first district.


The Capitol reportedly still owes more than P300 million to the same contractors, but the administration of Gov. Hilario Davide III has refused to pay them.

COA wants Capitol to settle the matter with the liable parties, while Sanchez said they will formally inform the administration of former governor Gwendolyn Garcia about COA’s report.

Last Jan. 14, Provincial Accountant Marieto Ypil said Capitol owes P607.239 million to 31 contractors.

Provincial Engineer Hector Jamora said P250 million worth of projects have been completed and payment to their contractors can be considered “demandable.”

Engr. Bernabe Gilbor, owner of Supreme ABF Construction and Construction Supply Company Inc. that built Danao Provincial Hospital, believes they’re caught in a middle of a political crossfire.

“Dapat i-pa close ko yang hospital (Danao) dahil hindi ako nabayaran, pero naawa ako sa mga tao (I should demand the closure of the hospital but I feel sorry for the people),” he said.

Gilbor, a former Negros Occidental PB member, hopes he will eventually get paid.

Atty. Lito Astillero, lawyer of former governor and now Third District Representative Garcia, said COA’s recommendations are not based on the law.

RA 7160

He cited Sections 305-A and 306-B of Republic Act 7160, or the Local Government Code of 1991.

According to Section 305-A, “No money shall be paid out of the local treasury except in pursuance of an appropriation ordinance.”

Section 306-B says “appropriation refers to an authorization made by an ordinance directing payment of goods, services from local government funds under specified condition or for specific purposes.”

“Although naa na ta’y (the Capitol has an) appropriation ordinance, ang ilang gusto (COA wants) upon release of money another legislative act of PB is needed,” Astillero said.

He said there’s no need for another legislative act for another payment.

Astillero said he is wondering why raise the issue now and not when Magpale was a PB member.

“Maybe COA is changing the rules,” he said.

Davide had said he is willing to face contractors if they raise the matter in court.

Sanchez, though, said she is open to the idea of seeking other agencies’ opinion on the matter.