The P40 million borrowing approved by the majority in Tuesday’s session of the Sangguniang Bayan of Nabunturan has
baffled three councilors opposing the controversial P90-million bond flotation which is starting to be fully underway at present.
Opposing Councilors Raul Caballero, Alfonso “Jun” Tabas Jr and Editha Arangcon were reportedly confused over
the item “P40 million borrowing” included in the P42.84-million second supplemental budget ordinance that was
passed after Vice Mayor Romeo Clarin reportedly cut short Tabas by suddenly calling for the voting of the measure with words
“para mahuman na ni” (so this will end).
By that, Tabas was reportedly restrained while on the thick of debating amidst the alleged ganging up of the majority members
on him.
The pro-bond float majority immediately voted and passed the budget ordinance following rowdy deliberation with
the questioning minority councilors.
Tabas said in an interview that he was confused over the purpose and source of the borrowing, which has not specified any
government financing institution.
He said that the P40-million borrowing was not a transparent item as it neither said of a bank nor said it would go for
the bond flotation’s obligations.
Caballero, on the other hand, said that the measure rushed by the majority only confirmed the suspicion that under the
bond flotation the municipal government would borrow after all contrary to what has been propagandized earlier that the scheme
would not contract a loan but only source money from the bond float investors.
In the budget ordinance sought as urgent by Mayor Macario Humol, the P40-million borrowing was stated to be the budget
for the construction of the commercial market complex, the object of the bond float project.
Also on Tuesday’s session a resolution was approved by the majority which lifted the confidentiality of the bank
accounts of the municipal government in its depository bank, Land Bank of the Philippines in so far as the Department of Finance
and the Central Bank are concerned.
Proponents said it was a requirement under the bond flotation project to allow the DoF and Central Bank to assess the financial
standing including the Internal Revenue Allotment remittances for the proponent local government unit.
As required, the DoF would still assess the feasibility study of the project before it will make its endorsement for the
final go signal for the funding start of the project.
As this developed, bond float oppositors have reportedly heightened their signature campaign to repeal the controversial
ordinance under the people’s initiative provision as spelled out under the Local Government Code.
Also on Tuesday, oppositors mostly coming from the market vendors whose stalls were gutted by fire three years ago signed
the petition at the open municipal gym at the public market. They were joined in by the minority councilors.
The town’s market vendors have been apprehensive that the project would dislocate them from their livelihood as the
proposed public market building has high monthly rentals amounting to not less than P10,500 for the minimum 10-square meter
stall based on the approved project’s feasibility study.
The bond float has been criticized to be exorbitant and expensive project that the oppositors said would not only dislocate
the lowly market vendors but also strain the delivery of basic government services in the next ten years after the term of
the last-termer mayor.
They said that that the town’s IRA is made the sinking-fund source and collateral for the obligations attendant to
bond float. (Cha Monforte/Rural Urban News) http://ruralurbanews.blogspot.com
posted: aug 13/08
By Cha Monforte
Oppositors to the P90-million bond flotation in the Nabunturan, Compostela Valley have
immediately shifted to their Plan B, that is to launch a people’s initiative leading to a referendum to decide whether
to proceed or not with the controversial bond float following Wednesday’s confirmation of the provincial board on the
municipal resolution approving it.
“It’s not over yet,” said Antonio Mencidor, spokesman of the oppositors
to the P90-million bond flotation being pushed by Mayor Macario Humol.
Mencidor bared that they have just prepared a petition for people’s initiative projecting
an eventual confirmation of the Sangguniang Panlalawigan.
He bared that oppositors are starting to gather signatures of at least 100 registered
voters as required under the provisions on local initiative of the local government code.
He said that they wanted the people of Nabunturan to decide in a referendum whether or
not they want the bond float to proceed.
In last Wednesday’s Sangguniang Panlalawigan session attended by 11 boardmembers,
6 “yes” votes over the 4 “no” votes were cast on nominal voting, thus confirming Municipal Resolution
No. 10-2008 which approved the feasibility study for the 10-year bond flotation that would fund for the construction of a
new public market building in town.
In a gallery largely filled by an anti-bond flotation crowd, acting presiding officer
Boardmember Maria Carmen Zamora-Apsay had to admonish for several times the lobbying oppositors who cheered for the opposing
Boardmember Dexter Lopoz, a lawyer, who locked horns with the proponent Boardmember Ruwel Peter Gonzaga, also a lawyer, in
a two-hour debate and interpellation during the privilege hour that sliced up the supposed calendared agenda of the session.
Vice Governor Ramil Gentugaya was not presiding as he was on official business in Manila.
Voting “yes” were Boardmembers Gonzaga, Cesar Richa, Moran Takasan, Rogelio
Arambala, all of the District 2, PCL Representative Joselien Romano and Paul Galicia, both of District 1.
Voting “no” were Boardmembers Lopoz, Neri Barte, Armando Codilla, all of District
1, and Boardmember Ruben Flores of District 2.
Flores, a former Nabunturan mayor, and allied with the original Lakas majority, made a
surprise when he voted in negative. He was later on congratulated by the anti-flotation crowd in the gallery.
“Nabunturan voters will be marking off the District 2 boardmembers who voted yes
to the detriment of the people,” one of the lobbying market vendors was quoted as saying after the SP confirmed the
resolution. Referred to were Gonzaga, Richa, Takasan and Arambala.
The oppositors have been charging that the bond flotation is so expensive with exorbitant
charges and fees that are “grossly disadvantageous to the government”.
Also, market vendors have been apprehensive they could be displaced in
the planned new market building where high monthly rentals are pegged in the feasibility study as a minimum of 10 square-meter
stall could readily fetch a P10,500 monthly rental. (Cha Monforte/Rural Urban News)
http://ruralurbanews.blogspot.com
By Cha Monforte
Monkayo Mayor Manuel Brillantes Jr. has made sort of verbal sniping to
the controversial P90-million bond flotation in Nabunturan when he recently remarked that the amount of which could already
make up to three to four big infrastructure projects in his own municipality in today’s prices.
“Not only one but three to four,” he said to a question posed
by the press.
He added though he was only estimating, taking into account the current
high inflationary rates, and should not be misconstrued as intervening in the internal affairs of Nabunturan.
The question was posed as Brillantes made ostensible accomplishments
in his own town after he has served for one three-year term and one year in his current second term as mayor in his town.
During this four-year period, Brillantes had completed through bank borrowings
four sparklingly modern, high impact projects that include the P16-million new municipal hall, P16-million new municipal gym,
P11-million new market building and P11-million solid waste management system.
In sum , he accomplished four big projects at a total of P54 million
only, compared to the P90 million for only one public market building.
Observers said that even the old-time pioneers in the Monkayo have been
surprised to see that their town’s poblacion has experienced great facelift under the leadership of Brillantes, who
came only in Monkayo in the 80s from outside to join the gold rush in Diwalwal.
The Brillanteses are known to have big mining operations in Diwalwal.
They started from the scratch of small scale mining during the heyday of the gold rush.
The mayor said that he always thinks and ponders in his study table at
home on what to do to develop Monkayo.
He said that when he decides it’s always well thought and deeply
reflected especially the on repercussions of the project to his people.
Asked on what made him make Monkayo as it is now, “because I am
not a trapo (traditional politician),” he shot back.
By Cha Monforte
“Morag taas ra gyud” (It seems exorbitant).
This was the opinion of Compostela Valley Governor Arturo
“Chiongkee” Uy when informed of the schedule of rentals of stalls and spaces based on the feasibility study of
the P90-million bond flotation which seeks to fund for the construction of a new public market building in Nabunturan
town.
The governor was informed that the feasibility study showed
that a minimum of 10-square meter could readily have a monthly rental of over P9,000.
He was apprised last Saturday by Boardmember Atty. Dexter
Lopoz, who is opposing in the provincial board the municipal resolution approving the bond flotation project pushed by Mayor
Macario Humol.
The resolution is scheduled to be taken up on plenary this
coming Wednesday’s session of the provincial board after the matter was not calendared in the agenda last week.
Earlier, the joint committee of finance and legal matters
recommended for the approval of the said resolution with a main ground that the legal review powers of the provincial board
is limited and hence it could not question the wisdom of the bond flotation of the proponent municipality, a contention opposed
by Lopoz and several of his colleagues.
Gov. Uy said that the monthly rental appears
to be not affordable to small vendors although he said he has still to see for himself the papers and feasibility study of
the bond flotation.
He said he would further probe on this complaint even as
he said he would take a hands-off position to the controversial issue if parties would reach to courts.
The bond flotation has been protested by oppositor taxpayers
and stall renters and market vendors of the old market building which was razed to the ground by a fire three years ago.
Oppositors charged that the bond flotation pushed by Mayor
Humol and Vice Romeo Mayor and his majority of councilors is exorbitant and too expensive and its terms are grossly disadvantageous
to the government as earlier nixed even in a comparative study made by the town’s local finance committee.
They charged as expensive and exorbitant the fees and other
charges which included the P6.5 million for the architectural and engineering design alone which they dubbed as “sa
papel pa lang” and other hidden fees, high interest rates, and other charges and expenditures that are much greater
than or unnecessary if the municipal government resorts to mere bank borrowing.
Small stall renters and vendors in the town’s market
have earlier expressed fear they would be dislocated from the project as the new public market to be constructed would have
higher monthly rentals and advances which they said they could hardly afford.
Local oppositors have already mapped various legal actions
including administrative case, recall and appeal for review by Department of Justice.
They charged that a project that is grossly disadvantageous to the government is violative in itself to
Republic Act No. 3019, otherwise known as Anti-Graft and Corrupt Practices Act. (Cha Monforte/Rural Urban News) http://ruralurbanews.blogspot.com
(7/7/08) The Compostela Valley provincial board will take up on plenary this coming Wednesday the controversial P90-million
bond flotation of the municipality of the Nabunturan which oppositors charged earlier as grossly disadvantageous to the government.
The scheduled taking up of the municipal bond float is expecting a clash of legal luminaries among members of the provincial
board and nominal voting to occur among members, sources told Sidlak.
Last week, the joint committee on finance and legal matters chaired by Boardmember Ruwel Peter Gonzaga favorably acted
on the municipal resolution approving the feasibility study for the P90-million bond float which seeks to fund for the construction
of a new market building that would replace for the public stalls and buildings which were gutted by a fire three years ago.
Oppositors charged that the bond flotation pushed by Mayor Macario Humol and Vice Romeo Mayor and his majority of councilors
is exorbitant and too expensive and its terms are grossly disadvantageous to the government as earlier nixed even in a comparative
study made by the town’s local finance committee.
Gonzaga, a lawyer and former vice governor, reportedly disempowered his committee citing arguments that the legal review
powers of .the provincial board is limited and that it could not question the wisdom of the bond flotation of the proponent
municipality.
But opposing Boardmember Atty. Arvin Dexter Lopoz countered that Gonzaga’s argument was flimsy as it would mean
that should a municipal law is found to be glaringly contrary to law it would also go to say that the provincial board could
not act on it otherwise for lack of legal review powers.
Critics of the Nabunturan bond flotation had also earlier charged that it was disadvantageous to the government for
its expensive and exorbitant fees and other charges which included the P6.5 million for the architectural and engineering
design alone which they dubbed as “sa papel pa lang” and other hidden fees, high interest rates, and other charges
and expenditures that are much greater than or unnecessary if the municipal government resorts to mere bank borrowing.
Small stall renters and vendors in the town’s market have earlier expressed fear they would be dislocated from
the project as the new public market to be constructed would have higher monthly rentals and advances which they said they
could hardly afford.
In the feasibility study, a meter 10-square meter stall would have over P9,000 monthly rental.
Local oppositors have already mapped various legal actions including administrative case, recall and appeal for review
by Department of Justice.
They charged that a project that is grossly disadvantageous to the government is violative in itself to Republic Act
No. 3019, otherwise known as Anti-Graft and Corrupt Practices Act. (Cha Monforte/Rural Urban News) http://ruralurbanews.blogspot.com
Comval SP refers controversial Nabunturan P90-M bond float to committee
The Compostela Valley provincial board has referred the municipal resolution
approving the P90 million bond flotation in Nabunturan town to a joint committee for a study during their session Wednesday.
But local critics of the bond flotation have expressed fear that the committee
referral could be overtaken by the 30-day required period for Sangguniang Panlalawigan confirmation.
They charged that the SP legal committee chaired by Boardmember Peter Ruwel
Gonzaga is presently too saddled with referred legal cases and delays of recommending legal matters which need lengthy of
time of study, probe and recommendation.
The SP on Wednesday constituted a joint committee composed of the committee
on legal matters and the committee on budget and finance, each of which have to make its study and recommendation to the joint
committee created which would recommend to the whole SP on whether to confirm or not the municipal resolution approving the
feasibility study for the P90 million
bond flotation.
Once the legal committee drags its foot in not acting alone on Nabunturan resolution
beyond a month’s time as required under the Local Government Code, the resolution is deemed approved and confirmed.
Boardmember Dexter Lopoz of District 1 earlier opposed the municipal resolution
charging that the terms and conditions of bond flotation are “grossly disadvantageous” to the government.
The approval of the said resolution could lay the legal groundwork for the controversial
bond flotation in town to proceed.
Oppositors have charged the municipal bond float Mayor Macario Humol is pursuing
in his last term is “so expensive” and its projects components are laden with exorbitant and unnecessary fees
and hidden charges such as the P6.7 million for the architectural and engineering design, P2.7 million consultancy fee and
P2.8 million underwriter and guarantee fees.
They also questioned the mayor’s insistence to pursue the project despite
the adverse findings of the municipal local finance committee showing the total expenditure of a bond float is at least P14
million greater than the expenditure of resorting to borrowing with the Development Bank of the Philippines with the staggering
P19.8 million for interest payment alone for the first two years.
Earlier, Vice Mayor Romeo Clarin and nine of the 11 councilors who are in favor
to the project were reported to have been “well accommodated” by the project’s financial adviser-consultant
Preferred Ventures Corp. when they made a study tour to Calatagan, Batangas to know of Calatagan’s bond float early
this year.
A source from the councilor’s majority said that the Calatagan public market
which was the subject of bond flotation brokered by Preferred Ventures is largely idle with a handful of renters at present.
Small market vendors in Nabunturan are also worried that they would be displaced
in the new market building sought for bond float financing as it pegs high monthly rentals of stalls.
Meanwhile, sources said that oppositors have reportedly mapped out legal actions
to stop the town’s bond flotation including filing of administrative cases, temporary restraining order (TRO), petition
for review by the Department of Justice and recall and initiative against the officials who approved the bond float project.
(Cha Monforte/Rural Urban News) http://ruralurbanews.blogspot.com
P90 M bond flotation for Nabunturan market opposed
By Cha Monforte, Rural Urban News (http://ruralurbanews.blogspot.com)
(NABUNTURAN,
Compostela Valley)- The move of the municipal government of Nabunturan to engage into ten-year bond flotation costing P90
million to finance for the construction of a new market building has been opposed by several sectors over its exorbitant amount
including its project components.
Already, the pre-final edition
of the feasibility study for the bond flotation was approved in a resolution three weeks ago by majority of the Sangguniang
Bayan led by Vice Mayor Romeo Clarin and proponent Councilor Iluminada Cabuga amid vehement opposition by Councilors Raul
Caballero and Alfonso Tabas Jr.
Bond flotation here would
mean that the Nabunturan local government unit would issue and sell interest-bearing paper bonds with which would
be paid up until ten years to individuals, government banks or private firms, the proceeds of which would be used for the
construction project of the town’s public market building. If there is no bond buyer who is assumed to be the investor
of the project, the bond flotation underwriter firm would underwrite the bonds in bulk and sell it to institutional buyers.
Bonds bought in this case
would mean the obligations (capital, interest and other charges) incurred by the municipal government which it would pay in
installments from its Internal Revenue Allotment (IRA) that has been assigned as source and collateral to the sinking fund
repayment to the obligations.
Ideally, proceeds or collections
from the project (public market building) to where the bond flotation was intended should be enough to pay for
the obligations but practically the IRA is stashed to make up for the repayments of obligations.
Two weeks ago, a public hearing
on the bond flotation was made by the executive and legislative departments without the presence of third-termer Mayor Macario
Humol but howls of protest were raised by vocal participants led by Tabas.
Oppositors
slammed the project’s staggering cost which is P90 million and several of its components as exorbitant and feared that
delivery of basic social services would be strained after Humol’s term as the Internal Revenue Allotment (IRA) of the
town will be tapped to pay for the obligations backing up the bonds.
Based on the feasibility study
alone prepared by the project’s financial adviser and consultant, Preferred Ventures Corp. only some P84
million will go directly to construction of the planned public market building, which has lot area of 1,700 square meters.
Tabas
charged as “too expensive” the pre-construction components that include architectural and engineering design amounting
to P6,057,465 , site development with P3,682,264, general requirements, P1,200,331, while P73,059,940. is allotted for the
construction of the new public market building which would stand in the area where the old market spaces were razed to the
ground by a fire over two years ago.
Oppositors
charged as prohibitive are the P2.7 million for the 3% consultancy fee which will go to Preferred Ventures Corp as the project
financial adviser, P1,350,000.00 for underwriter fee (1.5%), P900,000 guarantee fee (.05%-1.25%), and the P450,000 trustee
fee (.5%), all which would be paid during the first year repayment period.
First
the year alone, the municipal government would have to pay a total of P15.3 million, of which about P9.9 million goes for
interest payment, Tabas disclosed.
Councilor
Caballero appealed to his colleagues in the council not to push the bond flotation saying that ultimately it is disadvantageous
to the local government as what the comparative study of the local finance committee showed earlier.
The Nabunturan
Local Finance Committee reportedly released its comparative study late last year revealing that if the project is financed
through a loan on various terms Landbank repayment for the first year repayment showed having only P4,836,750 at the least
while the Development Bank of the Philippines has only P13,303,167.
The same
study noted that on the second year, repayment would reach P45,047,600 under the bond flotation, while LandBank and DBP loans
would only have P25,649,250and P40,633,750, respectively.
Oppositors
also said that small stall holders who were victims of the fire would be displaced as the new public building would have high
rentals for the spaces which in effect trigger high prices of basic commodities in town.
They
claimed that stall holders having 18 square-meter space would have to pay a monthly rental of P11,340 after paying
P68,040 for the three months advance rentals.
Tabas alleged the several
councilors from the majority went for a study tour on bond flotation this year to Calatagan, Batangas where personnel from
Preferred Ventures Corp. met with and accommodated them.
Meanwhile, Mayor Cesar Colina
of Maragusan has reportedly commented last week that he was able finish the construction of his town’s 96-stall public
market building as replacement to the one that was also gutted by fire three years ago at a cost of P3.4 million only using
his government’s own resources, in obvious comment to the bond flotation plan of Nabunturan. – Cha Monforte, Rural
Urban News (http://ruralurbanews.blogspot.com)
Nabunturan LGU consultant has record of failed bond flotation projects
By Cha Monforte, Rural Urban News (http://ruralurbanews.blogspot.com)
(NABUNTURAN, Compostela Valley)-
The financial adviser chosen by the municipal government of Nabunturan
for its P90-million bond flotation for the construction of new public market building has at least two cases where bond floats
for local governments had failed or went bust that dragged a town mayor to be convicted of graft and criminal cases.
This as allegation surfaced
recently that the Preferred Ventures Corporation, the consultant tapped by Mayor Macario Humol to assist in the ongoing bond
flotation process in his town, has fraternized with and “accommodated well” several Sanggunian members during
their study tour on bond flotation early this year at Calatagan, Batangas, where bond flotation was made through the Preferred
Ventures.
Councilor Alfonso Tabas Jr
questioned the propriety of the meeting between Preferred Ventures personnel and his colleagues while the resolution
on the bond flotation for Nabunturan was still being deliberated by the council early this year. Tabas and Councilor Raul
Caballero did not join in the study tour.
The firm stand to cough up
a whooping P2.7 million for its consultancy and financial advisorship from the project as shown in the feasibility study which
was approved by the sanggunian majority two weeks ago amid vehement objection by Tabas and Caballero.
Preferred Ventures, identified
online to be owned by economist and investment banker Dr Sixto Kalaw Roxas, with his president Danilo V. Fausto and headquarters
based in Mega Plaza in Ortigas Center, Pasig City.
The firm is reported to offer
a consultancy fee for bond flotation on “no cure, no pay” basis, that is, the fee is contingent on the amount
of bonds that shall be floated.
But it could not yet be readily
known at press time if the consultancy services of Preferred Ventures was procured by Mayor Humol on bidding or whether the
firm has initially received some fees as it started its consultancy work since last year.
FAILED TRACK RECORD
It was on Preferred Ventures
consultancy that the P25-million housing bond in Claveria, Misamis Oriental took off in 1994. On its implementation former
Misamis Oriental Governor Antonio Calingin, then the mayor of the town, was later convicted by the Ombudsman of 47 graft and
criminal cases for malversation of proceeds from bond flotation.
The brother of the mayor was
also caught with his hand inside the cookie jar of cornering the rentals of heavy equipment used in the construction
of the housing project.
In Claveria bond flotation,
proceeds from the housing project did not manage to reach 50 percent of the bonds floated resulting to the net loss of the
project which was inherited by the administration next to Calingin’s.
Preferred Ventures also caused
for the P40-million bond flotation for the jetty port and terminal building in Aklan province in 2000. But nobody bought bonds
for the project resulting to the repayment of the provincial government of more added costs for the underwriting of the project.
Through its underwriter, RCBC
Capital Corp. (RCBC), fortunately the Aklan government succeeded to shore up capital from institutional buyers.
Aklan though is fortunate
to a Boracay Island to where the jetty and terminal project in Caticlan was intended. Due to its tourists that have been served
by the projects the bond flotation paid off.
“Bond flotation is not
for every local government unit. There are projects that can easily be funded with direct loans without the local government
being saddled with added charges and conditions that come with bonds, said provincial accountant Ma. Victoria Salido in a
report.
In Aklan case, the provincial
government decided to reduce the amount of bond careful that its delivery of basic services would not be strained as a sizable
amount of its IRA was assigned as guarantee for repayment of the bonds.
A HIGH-RISK VENTURE
Meanwhile, an LGU Guarantee
Corporation report to Asian Development Bank has assessed that bond flotation as still a high-risk venture stating that private
investors are prone not to choose LGU bonds which have no national guarantee or tax benefits, over treasury bills
and treasury notes, which have zero risk as they are guaranteed by the national Government.
“The private financial
sector is not yet prepared to accept LGU risks without any form of credit enhancement, considering LGUs as high-risk, highly
politicized entities,” it said.
CRITICS
At prestime, the Nabunturan
bond flotation, which is now in the works, is saddled with criticisms over its exorbitant bond amount and its project components.
Charged
as prohibitive and “too expensive” are the high repayments to bond obligations and interests, architectural and
engineering design amounting to P6,057,465, site development, P3,682,264, general requirements, P1,200,331, P2.7 million for
the 3% consultancy fee, P1,350,000.00 for underwriter fee (1.5%), P900,000 guarantee fee (.05%-1.25%), and the P450,000 trustee
fee (.5%).
Critics
expressed surprise why Humol, Vice Mayor Romeo Clarin and the council majority are insisting for bond flotation when they
could avail of a loan from either the LandBank and Development Bank of the Philippines at much lesser terms and repayments.
They
said that the bond flotation option could strain much the delivery of basic services after Humol’s term as the bond
obligations including the interests, added and hidden costs have to be redeemed by the sinking fund put up from the town’s
IRA.
Oppositors also said that
the project is doomed to fail citing that the town’s resource and business capacity is not ripe for the bond flotation
on speculation that there be no bond investors and takers of the high-priced rentals of spaces in the planned public market
building.
“It’s like feeding
our IRA to the sharks when they could do otherwise, “ quipped a businessman who spoke on the condition of anonymity.
The IRA for Nabunturan in
2007 stood at P54.7 million.
BOND FLOTATION
Bond flotation here would
mean that the Nabunturan local government unit would issue and sell interest-bearing paper bonds with which would
be paid up until ten years to individuals, government banks or private firms, the proceeds of which would be used for the
construction project of the town’s public market building.
If there is no bond buyer
who is assumed to be the investor of the project, the bond flotation underwriter firm would underwrite the bonds in bulk and
sell it to institutional buyers.
Bonds bought in this case
would mean the obligations (capital, interest and other charges) incurred by the municipal government which it would pay in
installments from its Internal Revenue Allotment (IRA) that has been assigned as source and collateral to the sinking fund
repayment to the obligations.
Ideally, proceeds or collections
from the project (public market building) to where the bond flotation was intended should be enough to pay for
the obligations but practically the IRA is stashed to make up for the repayments of obligations.- Cha Monforte, Rural Urban
News (http://ruralurbanews.blogspot.com)
