A heap of lies and deceit (Part 2)

Coffeebreak

When Jed Patrick Mabilog assumed office as City Mayor on June 30, 2010, he was filled with excitement and enthusiasm at being the first local chief executive to preside over the affairs of the LGU from his perch on the 7th floor — the top floor — of the new Iloilo City Hall building.

The project had broken ground in February 2010, or shortly before the May 10, 2010 elections, and he looked forward to moving into the new building by August 25 this year when the city commemorates its charter day anniversary. Hence, Mabilog was surprised to find out that the P368-million contract awarded to FF Cruz and Co./Freyssinet Filipinas Joint Venture only covered the “shell structure” of the building.

Apparently, Mabilog kept his puzzlement to himself. He was afraid to confront his predecessor, former City Mayor, and now Congressman, Jerry P. Trenas. And instead of trying to expose the glaring irregularity, he set into motion his own scheme to fleece the project by padding the cost estimates for the completion of the building.

First, it was just a cover-up. It didn’t take long before a nefarious plan was hatched to defraud the taxpayers of Iloilo City by as much as P300 million from this single project and deliver an exorbitantly-priced P710-million City Hall.

But the timely objections raised by the Iloilo media, notably Iloilo Press Club president Rommel S. Ynion, appears to have stopped the second phase of the unending robbery in broad daylight. With the Commission on Audit making known its disapproval of the plan to award the second contract to FFCCI/FF JV through negotiated procurement, the Mabilog is now sounding the retreat bugle to avoid being mired in a messy corruption case.

Will Mabilog’s withdrawal from his grand scheme extricate him from corruption charges? My answer is “no”. The gravity of his offenses might be mitigated, but he will find it hard to get out of the quicksand. The conspiracy theory is plastered all over the place, like “post-it” notes on every square inch of a wall. As the Revised Penal Code puts it, “the act of one is the act of all.” The cover-up is what will drag Mabilog down in this mess, even though the “consummated crimes” happened in the previous administration.

Mabilog can’t feign ignorance or disavow any participation. The mere fact that he didn’t squeal the moment he discovered that it wasn’t a finished City Hall that’s being built ties him to the anomaly. The anti-graft and corrupt practices act punishes both “sins of commission” and “sins of omission”.

It’s the city’s great misfortune to see its major infrastructure projects mired in anomalies and scandals. The Pavia housing project mess has resulted in over P150 million in losses — vanished into thin air — for the city. Nobody has yet been prosecuted for this scam. There’s hardly a big transaction involving the city government that’s not tainted with scandal. The purchases of relocation sites are notorious for overpricing and not-so-hidden commissions. And now the City Hall project is caught in a big storm of controversy.

What’s more surprising is that deafening silence from local leaders regarding this scandal. It’s as if nothing is happening. People are treating this like an ordinary traffic accident. Only the media is taking up the cudgels. What’s worse, the officials involved are keeping quiet, and have even launched a black propaganda campaign against journalists pursuing the story.

I can sense that the general public is watching the issue closely. They are not inclined to march in the streets just yet. They want to hear the side of Mabilog and Trenas. Well, the media, too, wants to get the side of media. But as things are going, that’s not likely to happen anytime soon. It’s obvious they are hunkering down deep in their trenches, praying the storm would soon leave, and the situation will return to normal.

The COA and the Ombudsman should be taking notes as the controversy rages. What I have been reporting on are based on statements from knowledgeable experts based on their understanding of the law, and the available facts. The media is providing them the leads; all they need to do is pursue those leads using the vast powers of their agencies.

More questions on City Hall project

http://www.iloilonewstoday.com/index.php?option=com_content&view=article&id=2583:more-questions-surface-in-city-hall-controversy&catid=98:local-news

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.

P455-m enough to finish City Hall – consultant

The wanton and needless revisions to the original plans for the new Iloilo City Hall caused its cost estimates to balloon from P455 million to P700 millon, the consultant to the project revealed on Sunday.

Conrado Goco, president of the Pacific Orient Consultants and Management Corp., said the original loan of the city from Land Bank would have been enough to get the controversial project completed and ready for occupancy.

But when City Mayor Jed Patrick Mabilog assumed office last June 30, he immediately began making revisions and changing the specifications, totally unmindful that he would burden the city government, and its taxpayers, with an additional P260 million just to satisfy his craving to build a City Hall that suited his extravagant tastes.

“Yes, the original P455 million is enough to finish the project,” Goco said yesterday on “Serbisyo Publiko”, the Sunday public affairs program of City Councilor Perla Zulueta on Sky/Sun Cable community channel 13. Zulueta had pressed Goco to state clearly whether the original loan was enough for the project.

The interview was carried live by all radio stations on paid airtime.

And what was intended as a public relations stunt to deflect the allegations of overpricing and profligate spending appears to have backfired on the Mabilog administration as Goco admitted all these revisions were made at the initiative of the local chief executive.

Goco said he was just carrying out the wishes of Mabilog in putting these proposed revisions on paper. Among others, he admitted that Mabilog had already picked a supplier for a P9-millon solar power package to supply the energy needs of his office. The company is the same supplier for the solar power package for his home, it was revealed.

The revelations horrified Zulueta, who noted that the project would cost a staggering P48,000 per square meter under the grandiose plans hatched by Mabilog.

“We have to realize the city government will have to pay P49 million in interest charges alone for the first three years of the repayment period,” Zulueta, who was visibly aghast over the extra P260 million in costs, remarked.

During the interview, Goco clarified that his statement several days ago about the construction costs for the New Iloilo Capitol building was taken out of context. The P27,000 per square meter that he mentioned for the Capitol project represented the total amount for the finished structure, he said. On the other hand, the unit cost of P25,000 per square meter for the City Hall covered only the bare structure, he added.

As the controversy continued to rage, Mabilog appears to have retreated from a hardline position by asking local architects to review the proposed revision and completion plans to check on the reasonableness of the costs.

Earlier, Mabilog had adopted a hardline position on the issue, insisting that the proposed plan was reasonable to make sure the City Hall “is the best in the country.” He wanted everything in the structure to be made of the highest quality, he said.

Mabilog also bared during the weekend he has scrapped the P9-million budget for the solar power package that he wanted incorporated into the building to demonstrate the “green” side of his administration. He also backpedaled on his proposal to buy the 3,063-sqm. Kerr and Company property beside the project to be used as parking spaces, saying it will be considered only “if necessary”.

Mabilog had wanted to ask for an additional P35 million to buy the Kerr and Company property but the proposal was quickly shot down by critics.

Zulueta, an ally of Mabilog, was vocal in expressing her opposition to the plan.

“The plan would have made it the most expensive parking area in the country,” Zulueta said.

The multi-term councilor who is known as the “Iron Lady” did her research and found out that a parking slot for small cars would cost P294,000 without even considering the development costs yet. The parking spaces for big-sized cars would cost P350,000 per slot, she added. (30)