New Manila International Airport bill hurdles Senate

Published October 12, 2020, 3:53 PM

by Vanne Elaine Terrazola

The bill that would allow the construction and operation of the P700-billion New Manila International Airport (MIA) hurdled the Senate Monday.

(San Miguel Corporation / MANILA BULLETIN)

Voting 22-0, members of the Senate approved on third and final reading House Bill No. 7507, which proposes the grant of a congressional franchise to San Miguel Aerocity Inc. to “construct, develop, establish, operate, and maintain” the 2,500-hectare domestic and international airport in Bulakan, Bulacan.

The measure also sought to allow San Miguel Aerocity to develop an “airport city” in the municipality.

San Miguel Aerocity is a subsidiary of  San Miguel Corp. (SMC) which committed to take on the development project at no cost to the government.

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Under the franchise bill, the construction of the airport shall begin within a year of the franchise grant and shall be completed in 10 years. After franchise ha expired, the airport will be turned over to the government.

In exchange of SMC’s commitment to shoulder the cost of the airport construction, the firm will be exempt from all direct and indirect taxes and fees during the 10-year construction period of the airport.

And for the remaining 40 years of its franchise, the franchise grantee shall be exempt only from income and property taxes until it has recovered its investment cost. After which, it shall be subjected to all taxes.

The bill also provides that any amount in excess of the airport developer’s 12-percent profit margin shall be remitted to the government.

Senators were unanimous in supporting the airport project as they expect it to help economic growth following the COVID-19 pandemic and decongest the Ninoy Aquino International Airport as well as Metro Manila roads.

“It is with great pleasure that we thank our colleagues for the passge of the measure that was born 17 years ago,” Senate President Vicente Sotto III said as he narrated that the airport construction plan was conceived in November, 2003.

Senator Grace Poe, Senate public services committee chairperson and sponsor of the measure, also thanked her colleague for passing the San Miguel Aerocity’s franchise.

“I am glad that this body has recognized that we really needed to fast-track these franchises, more than anything to provide employment,” she said.

Poe said the airport project will employ 450,000 workers during its construction, and “upwards to a million people will be able to benefit from this undertaking.”

“We are so grateful because not only it produce a million jobs without [government] expense, without government spending a single cent, without any government guarantees, we are so thankful because we know that this is a dream come true for all of us,” Sen. Joel Villanueva, who hails from Bulacan, said.

Senators Richard Gordon, Ronald Dela Rosa, Ramon Revilla also lauded the Senate’s passage of the House bill as they said it would benefit the entire country.

Meanwhile, Senate Minority Leader Franklin Drilon said the franchise bill shall serve as a “contract” between the SMC and the government and cannot be revoked by future Congresses, noting the impending passage of the CREATE bill and its effect to tax incentives.

Sen. Panfilo Lacson also said the Senate “should be very clear on this issue” and reconcile the provisions of the CREATE bill and the Aerocity’s franchise bill.

On the concerns raised by residents and environmental groups, the SMC had earlier assured to respond to the needs of communities that will be affected and displaced by the construction of the airport.

Poe vouched for the SMC “consistency” in delivering its commitment to the government and the public.

Following its approval in the both houses of Congress, lawmakers will reconcile the differing provisions of the franchise bill and later ratify it for enrollment to the President.

 
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