Aquino’s swift action on P125 million vetoed PEZA share lauded

By Dexter A. See

BAGUIO CITY – Mayor Mauricio G. Domogan here cited the swift action of President Aquino on the claim of the city government regarding its P125 million share from the national wealth tax paid by locators of the Philippine Economic Zone Authority that was wrongly remitted to the national treasury which he vetoed after the same was included as part of the P1.645 trillion national budget this year.

Apparently, President Aquino gave instructions to the regional office of the Department of Budget and Management to study and evaluate the claim of the city from the national government and come out with a report in order to guide him in future presidential interventions on the said matter.

The regional DBM office and the city’s finance officers are reconciling their data relative to the said vetoed PEZA share of the city before submitting a final report to the Office of the President for his proper action.

According to Domogan, the matter was extensively explained to the President during their one-on-one meeting on Dec. 31, thus, he is confident the city government will gain headway in collecting the share.

If the President gives the go signal for the remittance of the same to the city, the local chief executive said the amount will be used to partially pay the Government Service Insurance System on the accumulated P316 million purchase prize of the 10,000 square meter Baguio Convention Center property so that the local government will be able to own a convention facility in the future.

Considering that the city government and GSIS had an earlier agreement on how it will settle its obligation relative to the purchase of the convention facility, the amount will be left to the GSIS to collect from the DBM central office and shall be deducted from the city’s obligation while it will look for other sources to fully pay the purchase price, including its 12 percent interest and surcharges over the past seven years.

In 2004, the city government entered into a tripartite agreement with GSIS and the Bases Conversion and Development Authority for the city to purchase the GSIS-owned Baguio Convention Center using its share from the operation of the Camp John Hay special economic zone through the BCDA.

However, BCDA defaulted in the payment of the P35 million annual amortization for a period of seven years following the payment of a P50 million down payment because the CJH developer was severely affected by the global financial crisis, thus, GSIS was forced to file ejectment proceedings against the city government on the use of the convention center.

The city government is entitled to a 25 percent share from the lease rentals of the CJH special economic zone in the 50-year lifespan of the privatization agreement which started in 1997.

Domogan said once President Aquino acceeds to the request of the city on how the funds will be utilized, the city’s problems on acquiring the premier convention facility as well as its GSIS obligation will be solved for the benefit of the local government. -- Dexter A. See