THE NEWS FLOW. -- December 30, 2022: Cebu City Council approved an increase of real estate taxes, a majority voted "yes" and three abstained.
-- February 6, 2023: Mayor Michael L. Rama wrote Vice Mayor Raymond Alvin Garcia and the councilors he directly vetoed Ordinance #1038, which revised the Real Property Tax Code.
-- February 12, 2023: Mayor Rama in a press statement announced the rejection, saying he will "reintroduce another proposal to revise real estate values" as the ordinance should reflect "current and fair market values of properties" in the City.
Here are seven takeaways from the mayor's veto and how it is being seen by players and watchers at City Hall:
[1] MAYOR DIDN'T GET WHAT HE WANTED. Majority Floor Leader Jocelyn G. Pesquera Monday, February 13, 2023, put it to me succinctly (one of the mayor's favorite words), thus: "He wants double the amount approved. And he wants that the appraisal rate be to-the-max, as indicated in the Local Government Code." The City Council, she said, "only approved increase in market values and no change in the assessment level. He wants the max of the assessment level."
Minority Floor Leader Nestor Archival Sr.'s take: "He didn't like that there is a condition." The string is a 75 percent limit on the spending every four months, depending on the actual tax collection in each quarter.
Councilor Rey Gealon, chairman of the Sanggunian committee on laws, summed up what the councilors did to the mayor's tax increase proposal: “We lowered it, not in accordance with his wish (‘dili base sa iyang gusto mahitabo’).” Gealon admitted the "drastic" slashing: "Ubos man gyud kaayo to, though naay increase, gamay." The mayor wanted "ma-increase gyud sa iyang gusto."
[2] WHY THE VETO. The official reasons Mayor Mike gave to the Sanggunian:
(a) It was "ultra vires" or outside the authority of the City Council because it violates the Local Government Code (Sec. 201) that real properties shall be "appraised at the current and fair market value prevailing in the locality where the property is situated." The ordinance didn't conform to the values from the assessor; some didn't reach one half of the proposed values.
(b) It was prejudicial to public welfare. The false valuation in effect deprives the City of sources of funds to implement its programs and projects "for the benefit of the people."
Addressing the public and sounding officious, he said in a Facebook post: "You've waited too long to save our government better. I know the poor among you can't wait. Why is it difficult for y'all?"
[3] MORE SPECIFIC PITCH. Mayor Mike didn't specify, even in the message to the City Council, that the ordinance would deny him the funds for his "Singapore-like Cebu City" mission, starting with the P50 billion budget in 2023.
By the estimate of Councilor Noel G. Wenceslao, chairman of the committee on budget and finance, the approved ordinance may raise only about P10-P12 billion in revenue. That's a whole lot of shortage to fill: "Singapore-like" could reach only up to "Sing."
The mayor gave a strong pitch on the need for funds: "the lifeblood of the government." And the people's impatience for results: "People have been waiting for the efficient delivery of basic services and the poor cannot wait."
[4] COUNCILORS SAW FIRST PLAN 'OPPRESSIVE.' The City Council saw the mayor's tax rates "excessive and oppressive." The majority vote of "yes," not a single "no," and three abstentions reflected that sentiment.
Councilor Mary Ann de los Santos (BOPK), reacting to the veto, told me the mayor is "being unmindful of the heavy burden city residents would face if his 'true value of properties' is used as basis for the tax rates." "The higher rates will cost undue suffering to property owners" and also "ordinary consumers and lowest of the poor."
Investors "may pass on the burden to consumers of services or tenants of rented properties." It's careless and irrational, de los Santos said, "The City is in bad shape and he has no clear direction to show."
The councilors have heeded the advice of Atty. Jonathan P. Capanas, dean of University of San Jose-Recoletos University law school, who -- in a briefing on taxation, which the City Council requested last December -- said the tax increase must not be so high as to be "confiscatory" and must be used for a public purpose that is significant to taxpayers.
[5] TORN BETWEEN TWO GOALS. Most councilors want to support the mayor's mission -- though some may see it as "too much, too soon" and "ambitious but impractical" -- but they also don't want to be seen by voters as unsympathetic to the plight of many landowners who own just enough land and home but don't have enough income to pay high taxes.
The councilors, particularly the majority, don't want to frustrate the mayor's and their party's plans but also don't wish to alienate voters.
[6] HAVE CAPACITY TO OVER-RIDE, BUT... Majority's chief Joy Pesquera said, "We have the capacity to override but we are still evaluating our options." In the same boat, the majority Barug, Councilor Wenceslao said, we still have to meet. They held, one may recall, "bicam meetings" on the road to the ordinance's passage but obviously that didn't work.
Minority's chief Archival said "it's not a good idea to over-ride the mayor," saying the ordinance will be reintroduced. He didn't explain to me why taking down the mayor's objection is a bad idea, especially to the minority BOPK, but he said "the mayor will feel bad."
The City Council can "tough it out" with the mayor by over-riding the veto but most likely it doesn't want to hurt the mayor's feelings. As between the mayor's feelings and the voters' feelings, the next election is still years away and the ordinance won't hurt the taxpayers until it figuratively kicks them in the face.
[7] FOCUS ON POLITICAL CAPITAL. The mayor's veto spotlights on the political cost of the issue. Public attention is drawn to (a) the huge public funds the mayor requires to make the City Singapore-like and (b) his willingness to bet on it the support and goodwill of voters, as expressed for him in the 2019 and 2022 elections.
From his toolbox of catchphrases, Mayor Mike may pick "the die is cast," "do or die," and "make or break." To be sure, he won't be speechless.