The contract of the 18B Kawit Project that the mayor is trying to ram down our throats is highly ANOMALOUS and DISADVANTAGEOUS to the City of Cebu.
So don’t be fooled by Commissioner Tommy’s rants. He will appeal to your emotions by childishly vilifying “Team Babag,” “Team Suyop,” etc. and by claiming that 5,000 jobs are at risk.
Want the real story? Want to know what is really at risk? Read on…
Contrary to what the Commissioner Tommy wants the people to believe, the council DID NOT BLOCK the 18B Kawit Project.
What the council blocked was a highly anomalous and disadvantageous contract that Cebu City would have been tied to for the next 50 years. Imagine that! A burden Commissioner Tommy is carelessly willing to place upon your children and even your children’s children.
As a lawyer, I like to go over contracts with a fine tooth comb to ensure that Cebu City will not be placed at a disadvantage. Para dili intawn ma-alkanse ang mga Cebuanos.
Among the questionable provisions of this Kawit contract are the following:
ANOMALY 1. The City would invest P10B worth of property and the joint venture (JV) partner would put in P18B worth of infrastructure.
SO, HOW COME CEBU CITY’S SHARE WOULD ONLY BE 10% of the gross RENTALS while the JV partner gets 90%?
Is this a fair rental profit-sharing scheme considering that we are putting in 10B in property to an 18B investment? Remember that in another joint venture project for the 3rd bridge, the city is getting 1% of gross without investing a single centavo or property.
ANOMALY 2. THE CITY WILL ONLY GET ITS 10% SHARE ON THE 9TH YEAR from time of the execution of the contract. That means walay madawat ang siyudad until the year 2027!
Why on the 9th year paman? Alkansi kaayo ang Cebu City.
In addition, THERE IS NO MINIMUM GUARANTEE AMOUNT. So if the joint venture partner has low rental income (as with what is happening now in Robinsons Galleria and SM Seaside) then the city does not get any income as well.
As an alternative, BARUG PDP LABAN councilors believe that a straight rental, fixed amount with an escalation clause is a better contract compared to a risky rental profit sharing scheme. In a straight lease, the CITY IS GUARANTEED A MONTHLY INCOME that is not affected by market forces. What’s more, rental payments begins on the very first month. And for a 9 hectare property valued at a CONSERVATIVE P200/sqm, that’s P18M per month on the first year of implementation! (Compare that to ZERO PESOS per MONTH UNTIL 2027!)
The city’s mandate is to deliver basic services to the people and not act as a private enterprise. What we need is a risk-free and stable contract that can support and sustain our government.
WE ARE NOT IN THE BUSINESS OF REAL ESTATE. We were elected to protect the interest of the city from anomalous and disadvantageous contracts. This is one of them. I can only surmise why the Commissioner Tommy is bullying us to approve this contract. Is there a huge commission and kickback to be made, Mr. Mayor? Only an agriculture dropout will believe you have nothing to gain from all this. Could this explain why you throw a tantrum whenever someone challenges your highly questionable pet projects?
As a public servant, I am duty-bound to place public interest over your personal interest, Mr. Mayor. I was not elected to be your “yes man” in the city council. I am here to hold you accountable and speak up when contracts that may benefit you personally are actually disadvantageous to our city. I know that, in the city council, you may want people whom you can easily intimidate and who are scared to stand up to you. Sorry, I am not one of them. You are not my boss, the Cebuanos are.
You want 5,000 jobs? Then stop blocking the Ayala-Filinvest-SM 42 hectare development at the SRP that will provide at least 100,000 jobs. This project would’ve included a stadium, office buildings, call center offices and commercial spaces among others.
People should be mindful to choose leaders who are in President Duterte’s party, so they can further the Presidents anti-corruption advocacy and BLOCK anomalous and disadvantageous contracts that the Kickback Mayor wants to railroad.