City to work out settlement on convention center tiff

By Aileen P. Refuerzo

BAGUIO CITY – Mayor Mauricio Domogan last week directed city legal officer Melchor Carlos Rabanes to work out the compromise settlement with the Government Service Insurance System (GSIS) for the resolution of the ejectment case it filed against the city over the purchase of the Baguio Convention Center.

In his Ugnayang Panlungsod press briefing last Wednesday, the mayor said he asked Rabanes to immediately coordinate with the GSIS legal counsel in preparing the compromise settlement which will be submitted to the court for approval.

This developed as the city council last Monday approved the mayor’s request for the realignment of P200,185,882.05 pooled from unused funds from the city coffers to pay the city’s outstanding balance to purchase the convention facility and avoid incurring more interest or lose the facility altogether.

The mayor pushed for the city’s payment amid the still unclear status of the city’s share from the lease rental of Camp John Hay from which the city was supposed to get the payment for the BCC as per the 2004 tripartite purchase agreement with the GSIS and the Bases Conversion Development Authority (BCDA).

The BCDA failed to deliver the amortizations on the deadlines set under the MOA due to the developer Camp John Hay Development Corporation (CJHDevCo)’s default in its payments.

This prompted the GSIS to file an ejectment case against the city for failing to pay its amortizations for the purchase of the facility originally pegged at P250 million.

Due to the non-payment, the city’s obligation has ballooned to P318 million exclusive of the initial payments made by the city amounting to at least P100 million.

After negotiations, the city’s balance was cut down to P200,185,882.05 and the city was given until May 30 to settle.

The mayor said that since the city failed to beat the deadline as the city council’s approval came only last Monday, the arrears can be expected to increase anew thus the need to speed up the settlement process.