THE Cebu City Legal Office (CCLO) has uncovered what it describes as “gross illegality” in how real property market values were increased through a scheme that bypassed official valuation systems.
An investigation conducted by the CCLO reveals that the fraud was linked to unauthorized overrides in the city’s computerized Real Property Tax System or AS400 between the years 2022 and 2023.
According to the CCLO’s investigation, the override function was allegedly introduced into the AS400 tax system by former City Administrator Collin Rosell and former Local Finance Committee (LCF) chairman Jerone Castillo during the administration of mayor Michael Rama.
Rosell, according to the CCLO, allegedly pressured City Hall employees from the City Assessor’s Office, Management Information and Computer Services (Mics) to “override” the system.
While Castillo passed LCF Resolution No. 7, series of 2023 on August 2023, facilitating the MICS to upgrade Real Property Tax (RPT) Assessment System of the City Assessor and City Treasurer’s Office.
Inflated tax declarations
The scheme reportedly led to inflated tax declarations and also compromised taxpayers’ rights.
The 32-page CCLO report on the investigation dated May 21, 2025, was submitted to then outgoing mayor Raymond Alvin Garcia and the 16th Sangguniang Panlungsod.
The findings were again formally endorsed on Tuesday, July 15, 2025, to the 17th Sangguniang Panlungsod for appropriate action.
The CCLO called on city officials to address “systemic fraud harming taxpayers.”
The unauthorized overrides that allowed system-generated market values to be replaced by owner-declared values were allegedly done under pressure from certain City Hall appointed officials at the time.
These owner-declared values were often much higher than the ordinance-prescribed rates. Some increases reportedly exceeded by 1,000 percent.
System-generated market values are based on a city ordinance and Bureau of Local Government Finance standards.
Violation
The CCLO said the scheme violated the Local Government Code, which mandates that market values must be set through ordinances, not declarations.
The report called for all affected tax declarations to be declared null and void. It also urged a review of administrative and criminal liabilities against individuals responsible for the scheme.
The report further said many taxpayers were unaware of the inflated assessments and missed the 60-day window to file formal appeals before the Local Board of Assessment Appeals.
Others withheld payment of their real property taxes in protest but had no legal recourse.
Recommendations
The CCLO has recommended the following actions: Immediate information campaigns and help desks to assist affected taxpayers; executive action to protect those who missed the appeal window; reassessment based on legal values, to take effect 90 days after invalidation of the illegal assessments; and legislation to declare override-based assessments void from the beginning.
“To leave such irregularities hidden and unresolved would undermine the principles of accountability, transparency, and justice that form the foundation of good governance,” the report said.
Verbal orders, notes
The override scheme was reportedly implemented through verbal instructions and even post-it notes. It bypassed technical safeguards built into the AS400 system.
The alleged fraudulent activity reportedly caused friction within the Mics. The head of Mics was among those removed from office pending further investigation.
The CCLO urged Mayor Nestor Archival, the City Treasurer, City Assessor and the council to coordinate in correcting the illegal valuations.
The CCLO noted that tax refunds are legally complicated as collected revenues have already been released to the city’s general fund, barangays, and special allocations.
The CCLO also called for the protection of taxpayers’ rights and the restoration of the credibility of the City’s fiscal governance. / EHP