The Commission on Audit (COA) has lifted the P19.8 million notice of disallowances it earlier issued against former Iloilo City mayors Jerry Treñas and Jed Mabilog, and several others on the consultancy contracts for the New Iloilo City Hall Building (NICHB) in 2007.

The disallowances pertained to the P19,814,000.54 payments for Architectural/Space Planning Engineering Design Consultancy Services (ASPEDCS) contracted with W.V. Coscolluela & Associates (WVCA), and the Construction Management Consultancy Services (CMCS) with Pacific-Orient Consultants & Management Co. (POCMCI) for the construction of the NICHB.

The COA’s special audit team (SAT) audited the payments made to WVCA for the ASPEDCS and disallowed the amounts of P9,676,050 and P1,800,000 since the original consultancy contract was without valid appropriation and legal basis. The supplemental consultancy contract for ASPEDCS with WVCA was also procured through alternative mode of negotiated procurement, it said.

The payments made to POCMCI for the CMCS were also disallowed in the amounts of P5,337,950.54 and P3,000,000 since the original contract for CMCS is without valid appropriation and legal basis, the COA said, and the supplemental contract was likewise procured through the alternative mode of negotiated procurement.

Former mayors Treñas and Mabilog, together with former city administrator Melchor U. Tan, assistant city treasurer Joan V. Montano, city accountant Michelle O. Lopez, city budget officer Ninda D. Atinado, cashier IV Sherill Grace D. Enriquez, and executive assistant Joren F. Sartorio filed an appeal against the Special Audit Office (SAO) Notice of Disallowance (ND) Nos. 2016-07001 and 2016-07-002, both dated Aug. 2, 2016.

While the COA lifted the notices of disallowance (NDs) on the consultancy contracts, it said it may still conduct an update on other matters which may arise from the original consultancy contract for the architectural/space planning and engineering design services and the update to the original construction management consultancy contract.

"Accordingly, the findings stated in the Technical Evaluation Report dated July 10, 2013 are remanded to the supervising auditor and audit team leader of the city government of Iloilo for further review and comment of the concerned officials," the COA ruled.

It granted the appeal as it considered the necessity of engaging separate consultancy contracts, which it found was "a lawful and proper exercise of authority."

"Applying these legal provisions and jurisprudence to the instant case, the Commission finds that the engagement of external consultants, specifically for architectural design services and related technical studies, was not only appropriate but legally necessary," the COA said.

"The appellants were compelled to engage the services of qualified technical professionals, given that the City Engineer, by law, is not authorized to prepare or sign architectural documents and that the government lacks the internal capacity to produce the required specialized technical outputs," it said.

The 20-page decision was signed by Chairperson Gamaliel A. Cordoba and Commissioner Douglas M.N. Mallillin.