CAGAYAN DE ORO CITY – A legislator here questioned the increase in the proposed amount that the city government is planning to loan for the new city hall complex in Barangay Carmen from over P1.6 billion to P2.7 billion during a committee hearing on Thursday, September 28.

Councilor Jose Pepe Abbu Jr., who scrutinized the proposed loan, asked the City Engineer’s Office (CEO) how it came up with the amount of over P900 million – one of the amounts added from the previous proposal – for the project’s construction while it only has the concept.

THE committees on ways and means and finance, budget, and appropriations of the 20th City Council prepare for the committee hearing discussing  proposed Ordinance No. 2023-310 on Thursday, September 28. (Franck Dick Rosete)

CEO acting head Engr. Joel Momongan, however, explained that despite having just the concept, they already have an idea of how much it will cost per square meter based on the number of their construction workers, saying that they cannot go into the details at the moment.

“In our approximate estimates, we come up with an amount of per square meter, P61,000 per square meter. That is the actual design we design in our engineering, your honor,” Momongan, who attended the hearing, said.

The proposed loan to fund the Cagayan de Oro Government Center and Eco-Tourism Site under proposed Ordinance No. 2023-310 has increased to P2.7 billion after the local finance committee added in the proposal over P139 million for the second phase of the land development and proposed amount for construction.

The committees on ways and means and finance, budget, and appropriations conducted the hearing to discuss the matter after it was deferred during the city council session on Monday, September 25. 

(Read: https://mb.com.ph/2023/9/25/cagayan-de-oro-council-defers-proposed-loan-for-new-city-hall-site)

Acting City Budget Officer Roxanne Mae Ravidas, chairperson of the local finance committee, apologized during the hearing for not including these amounts since there was also a commitment from Senate President Juan Miguel Zibiri of P1 billion for the project, which will be downloaded once the land acquisition is completed, said Councilor Yan Lam Lim, chairperson of the committee on finance, budget, and appropriations.

With Zubiri’s commitment, the total budget allocation for the construction ballooned to almost P2 billion, which was questioned by Abbu after Ravidas and Momongan said that “detail engineering and design” was to be followed.

“We should have proposed a budget for the building when we had the details,” the legislator said.

The city engineer countered and said that they already have estimates because their design is based on their personnel. The CEO has a total of 5,100 personnel for the project, with a working area of 2.4-square meters per person.

The local finance committee chairperson also clarified that the project is a “progress billing,” where the budget for the construction will only be downloaded once the land development is completed.

Councilor Yevonna Yacine Emano, who was also in the meeting, asked the local finance committee for the loan requirements before providing the authority to loan, emphasizing that if the proposed ordinance is passed, this won’t be a loan for just a person but for the entire city government. “Because again, P2.7 (billion) is no joke,” she said.

To include the city's previous loan of P1 billion, Ravidas said the city government, if the proposal for the new loan is approved, will be paying P105 million annually for the first two years and over P300 million for the remaining years. The payment, she said, can still be covered by the city’s 20 percent development fund, which will not compromise the budget for basic services.

Ravidas said that not only the new city hall building will be built in the area but also future national government agencies and eco-tourism.

Councilor George Goking, chairperson of the committee on ways and means, said the city government has the capacity to pay P7.5 billion, according to the Bureau of Local Government Finance. This was echoed by Ravidas but Goking said that it is not updated data.

The over two-hour meeting was mostly consumed by the discussion of the offer-to-sell amount of the land property per square, which is P6,500, and the appraised value of the City Appraisal Committee, which is P10,447.79. But this was clarified by the appraisal committee.

Out of the six members of the committee on ways and means, four councilors – who did not make any comments or questions during the meeting – voted in favor.

Abbu decided to abstain and not participate in further proceedings, saying that he is pro-development but is not satisfied with the explanation while Councilor Agapito Eriberto Suan still stood by his decision that he is against the proposed loan.

Majority of the members of the committee on finance, budget, and appropriations voted in favor of the proposal.

The matter was submitted to the committee on laws and rules before its schedule in the plenary.