Baguio officials at odds over market dev’t; protests mount

Amid allegations ‘money changed hands’ 

BAGUIO CITY – Officials of this tourism resort are now at odds over the multi-billion peso development of the city market even as public opposition is mounting. Vice mayor Faustino Olowan, after overturning the decision of the market selection team, got out of the group supposed to take charge of overseeing its development.
    "I think I can no longer help in the crafting of the best agreement, why? Because my vote was for the other proponent, it is unfair. Whatever I'll do, they will criticize me, because they will say I am biased because I did not vote for them," Olowan said, as he made his decision public on taking a leave from the People Selection Committee (P4-SC).

Olowan told local media he voted for Robinsons Land Corporation (RLP) along with majority of the City Council on basis of financial gains the City will enjoy.

Baguio Mayor Benjamin Magalong later rejected the decision of the committee and proceeded to award the original proponent status (OPS) to SM Prime Holdings Incorporated (SMPI).

The P4-SC met afternoon of Oct. 27 at the Baguio Convention Center while a multi-sectorial rally outside the facility was held.

Rallyists denounced the decision to award the OPS to SMPI with placards bearing messages like "No to corporate takeover" and "No SM! You can't have it all."

Close to 50 protesters were peacefully directed by the Baguio City Police Office and Special Weapons and Tactics teams to leave the premises while city officials met inside BCC.

Olowan said the protest was within the rights of the people to air grievances.

He added he respects their action but appealed to the groups to join negotiations for the market development, so voices may be heard, as well as recommendations on the now controversial issue.

Olowan reacted to backlash on awarding of the OPS to SMPI is not tainted with corruption and denounced allegations surrounding the integrity of the P4-SC.

Olowan said the decision of Magalong to award the OPS to SMPI overturning the P4-SC decision will be referred to the Dept. of the Interior and Local Government for comments.

"That is another matter. We are not appealing the case, we are just commenting on it. It is up to the DILG," Olowan said.

The meeting was led by City Administrator Boni Dela Peña with Councilors Betty Lourdes Tabanda, Mylen Yaranon, Fred Bagbagen, city budget officer Letty Clemente, acting city legal Richard Dayag and city stakeholders.

This, as Councilor Mylen Yaranon questioned privatization of the public market saying economic gain for local entrepreneurs will be in peril if SM gets hold of the public market.

"Have we not learned from our lessons in the past? The presence of SM at the top of Session Road was very detrimental to the economy of the central business district. The only economy that survived then were the vendors at the Baguio Public Market, because they provided to the consumers a more affordable and fresher produce from the local suppliers. So please, enough of entertaining these giant mall chains in even developing our public market," Yaranon said.

Last week, Mayor Magalong signed Memorandum 433 series of 2020, awarding the original proponent status (OPS) to SM Prime Holdings Incorporated (SMPHI), disapproving the previous awarding to Robinsons Land Corporation (RLP), said a media report.

But Yaranon said both proposals of RLC and SMPHI should be rejected.

"We should move on in formulating the project process by defining the mode of implementation, sources of finance and actions needed. Once we have set our financial goals and limitations, then we can proceed with finalizing the design process.     Let us adjust the master plan to conform to formulation results and available finance. Then we prepare the bill of quantities and other tender documents," Yaranon added.

"Let us study the SM Project Proposal and gather the comments from the reports of our evaluations and the PPP Center. I agree with the socio-economic analysis that while the unsolicited proposal of SMPH provided a Project Economic Viability Assessment as indicated in page 8 of their resubmitted FS, there is no detailed economic impact analysis and said assessment presented lacks the details to establish the economic viability of the project," Yaranon added.

Yaranon said the estimation of the Economic Internal Rate of Return should be traceable, taking into consideration all economic costs and benefits of the project and in order for the committee to estimate the Economic Internal Rate of Return (EIRR), it has to assume/project the economic activity associated with the commercial tenants.

This will be difficult, Yaranon added, since various types of retail outlets can generate vastly different total sales even with a same-sized space. The committee would also have to assume income generated from SM leasing out their commercial spaces.

"The financial viability for the city is not beneficial to the city. The lease term is 50 years, and yet we only receive a land lease payment of 2.325 Billion for the entire term of the agreement, which shall be used to construct the two-story new public market and the temporary transfer area. When in fact, the ROI is 5.45 percent for a payback period of 18.34 years. We may be better off availing of a loan instead. Is this the price we have to pay for at no cost to the government," she said.

Yaranon said the technical design of SMPH may be complete, but is very deficient.

"The market stalls are overcrowded with very narrow pathways, insufficient fire exits, insufficient toilet facilities, no central wayfinding, no area for bagsakan, wet section at the basement with no light and ventilation, in other words, the public market is not prioritized," Yaranon said.

Yaranon added that another issue to consider is that a project for a new or upgraded market will not interest market users unless they have participated in the design of the project and clearly perceive the development will bring advantages.

"Participation should occur at two levels: at the general planning stage the planning authority should ensure that residents' (consumers) needs are addressed; and at the level of the market the full participation of the traders should be sought. Even with such a dialogue, conflict may still occur and the fact that the new facilities are clearly an improvement may not be sufficient inducement. Retailers may refuse, for example, to transfer their activities to a new market if their new stalls are smaller than in the old market," the lawmaker added