Adjacent and contiguous

Nobody seems to be challenging the plan of the Mabilog administration to procure the P294 million in equipment, facilities and other furnishings to make the new Iloilo City Hall ready for occupancy by Aug. 25 through “negotiated procurement”. But as I pointed out in a previous blog post, “Revisions and change orders”, the move might be flawed, as it runs counter to the general principles of RA 9184, or the Government Procurement Act. It will make the city government vulnerable to overpriced transactions, or at the least open the terms that would be “grossly disadvantageous” to it.

I’ve been told that this planned move was reached in order to accomplish Mayor Mabilog’s desire to get the City Hall ready for occupancy in time for the celebration of the LGU’s charter day anniversary on Aug. 25. He has been quoted as warning the contractor that if this doesn’t happen, “then there will be no more city hall”. The deadline he gave sounded so absolute everybody seems afraid to displease him, and the city government could be headed to a legal disaster if it is allowed to proceed.

The Mabilog administration is anchoring its plan on Section 53.4 of the Implementing Rules and Regulations (IRR) of RA 9184, which allows negotiated procurement for projects that are deemed “adjacent and contiguous”. As it involves the same project, they assert the planned phase II of the project meets the criteria for one of the exceptions to the general rule of subjecting all procurements through public bidding. The key phrase under this section is that the new contract must be “similar in nature or scope of work”.

Question: do the items of work listed for Phase II of the project meet this requirement of being “similar in nature or scope of work”?

The city government, after consultation with COA regional technical chief Jun Cabahug, says “yes”. I felt otherwise. And I wrote about my reservations in the previous blog. But I went a step further. Yesterday (May 16), I got in touch with Atty. Quintin “Kits” Magsico, who is an authority on the subject. “Kits” worked with the Government Procurement Policy Board (GPPB) and has left government to do consultancy work with procurement as his specialty.

After explaining to “Kits” the details of the case, he didn’t hesitate to tell me that negotiated procurement would not be a proper thing to do for the city government. He pointed out that the first contract involved civil works, or the construction of a building. Most of Phase II involves the supply of elevators, generators, airconditioners, furnitures, fixtures, water pumps and tanks, power and data transmission lines, etc. Under the purview of RA 9184, these items are “goods” that cannot fall under Section 53.4 of the IRR. Public bidding is the proper method of procurement, he said.

Indeed, the exception provided under Section 53.4 of the IRR contemplates a smooth continuity in construction work. It provides a safeguard in the sense that it mandates that the new contract must not exceed the unit cost for the first contract. On this point alone, the plan suffers serious flaws. What will be the basis for determining the unit cost for elevators, airconditioners and other items included in Phase II? By entering into a negotiated contract with FF Cruz, it leaves gaping holes on the pricing of the items. How do we know the city government will obtain the best possible prices for the items? Zilch. It will literally give the contractor blanket authority to do its own shopping.

As Atty. Magsico pointed out, “there is no way you can compare apples with apples”. Phase I is about concrete, steel, glass and wood. Phase II is mostly about equipment and its installation to make the premises ready for occupancy. They are entirely different animals. Hence, the essence of the law in mandating competitive bidding for procurements will be defeated.

Mabilog’s desire to finish the project by Aug. 25 is not justification enough to set aside the mandate of the law. And the scandalous amount of P294 million for the items of work makes it imperative for Mabilog to avoid suspicion (as in fact it has already drawn heavy flak) that it is an elaborate scheme to pad prices and carry out a robbery in broad daylight. The project’s consultant, Conrado Goco, has admitted the original amount of P455 million which the previous administration had approved is enough to get the City Hall finished.

Mabilog should be reminded again and again he is spending the taxpayers’ money. He can’t just tell us he wants the best of everything to be put into the project. Quality need not be expensive, and I am not convinced the “upgrading” of several items which involves jacking up the cost estimates by the millons of pesos is intended to improve the quality. There must be a sinister motive to all of these.

The city loses nothing if the City Hall isn’t finished by Aug. 25. What is more important is that any cloud of doubt already hanging over the project must be allowed to dissipate by proceeding with prudence and transparency. I am certain the cost estimates of P294 million can be trimmed by more than two/thirds and still be adequate to complete a City Hall every Ilonggo can be proud of.

About Manuel "Boy" Mejorada
Manuel "Boy" Mejorada is a journalist and social media activist. A former Iloilo provincial administrator, he is now waging a crusade against corruption and narco-politics.

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