Trouble in John Hay

MANILA, Philippines – Criminal and administrative complaints were filed Wednesday, July 4, before the Office of the Ombudsman against 8 top executives of the Bases Conversion and Development Authority (BCDA) for allegedly causing undue injury to property developer Camp John Hay Development Corp (CJHDevCo).

Named respondents were BCDA president and CEO Arnel P. Casanova, BCDA board chairman Felicito C. Payumo and board members Zorayda Amelia C. Alonzo, Teresita A. Desierto, Ma. Aurora Geotina-Garcia, Ferdinand S. Golez, Elmar M. Gomez and Maximo L. Sangil.
 
Manuel T. Ubarra Jr., CJHDevCo vice president for litigation, sought indictments against the respondents for graft and violations of the Code of Conduct and Ethical Standards for Public Officials and Employees.

The complainant also asked the Ombudsman to order the dismissal of the 8 BCDA officials from their government positions for alleged refusal to do their job and misconduct in office.

Former Solicitor General Francisco Chavez, counsel for CJHDevCo, accompanied Ubarra in filing the complaint.

Ubarra said the respondent public officials have refused to honor BCDA’s obligations set under the 1996 agreement covering 246.99 hectares of the John Hay Special Economic Zone in Baguio City, which was leased to CJHDevCo for a period of 25 years renewable by another 25 years at the latter’s option.

Complicated

Under the lease agreement, CJHDevCo was supposed to develop the property into a tourism complex, multi-purpose forest watershed and human resource development center.

The deal became complicated after the Supreme Court issued a ruling in 2005 in the case of John Hay vs Lim nullifying the preferential tax rate for CJHDevCo of 5% of its gross income set under the lease agreement.

“Instead, CJHDevCo was being assessed the normal tax rate of 32 percent of gross income during the years 2003 to 2007, in gross violation of the earlier representation by BCDA. As a result of the withdrawal of preferential tax rate, the projects of CJHDevCo were placed on a near standstill and the company suffered tremendous losses,” Ubarra said in the complaint.

In July 2008, the developer and BCDA signed a Restructuring Memorandum of Agreement (RMOA) to speed up the processing of CJHDevCo’s permits, clearances and licenses and help it settle its P2.69-B prior rental obligations.

The RMOA likewise provided for the creation of an One-Stop Action Center (OSAC) “with full authority to process and issue all business, building and other developmental permits” in lieu of local and national government agencies within 30 days.
 
Ubarra said BCDA failed to establish the OSAC resulting in delays in the implementation of all initiatives of the developer to improve operations.

“To date, respondents have failed and refused, and still fail and refuse, to ensure the issuance of the required certificates, permits and licenses …thereby greatly hampering complainant’s operations,” he said, noting that the RMOA has now been in effect for three years and 10 months.

Chavez, speaking to reporters, accused BCDA of trying to maim CJHDevCo’s operations so it can takeover the John Hay project. – Rappler.com