THE Cebu City Government has failed to settle its P2-million obligation to the National Housing Authority (NHA) for a resettlement project in the upland area.
The failure to pay the dues caused the City to incur additional charges amounting to some P2.6 million, on top of the original loan, as stated in the audit report of the Commission on Audit (COA).
According to the COA report, the City did not pay the NHA since 2006 and that resulted in delinquency and amortization interest of some P2.6 million.
The loan was made to finance phase 1 of the resettlement project of the members of the Kalamboan Alang sa Panimuyo sa San Roque (Kapasar).
COA Circular 2007-001 dated October 25, 2007 requires that City as the signing officials of the memorandum of agreement (MOA) to monitor and inspect the project implementation.
State auditors said that of the P2 million loan granted by NHA to fund the Kapasar Resettlement Project, only P1,050,000 was released to its members.
However, the state audit was also informed by the City that P950,000 of the loan was already returned to NHA.
The officer-in-charge of the Division for the Welfare of the Urban Poor (DWUP) also requested NHA to condone the additional charges but did not receive any reply on the matter.
As of November 2015, only P162,532.49 was collected contrary to the terms and conditions in the MOA signed by the City Government and Kapasar.
Under the MOA, each member of the Kapasar should pay the City a monthly amortization of P316.69 payable in 10 years with an interest of nine percent.
The same audit observation was also relayed by COA to the City in 2013.
“In this case, collection were not done according to what has been agreed to by both parties. The delay and non-payment of the beneficiaries also caused the delay of payment of the LGU (local government unit) to NHA incurring additional obligation for the delinquency and amortization interest,” read portion of the COA report.
In response, City said an endorsement and demand letter and statement of account from NHA was already sent to DWUP so they can act on the matter.