COA clears Bacolod officials of overprice issue on Sanitary Landfill site purchase

“Praise God. Finally – vindication after eight long years.”

This was the reaction of Bacolod City Mayor Evelio Leonardia to the decision of the Commission Proper (CP) of the Commission on Audit (COA), promulgated last January 29, 2020, that finally lifted the Notice of Disallowance on the alleged overprice when the City purchased in 2008, a 7-hectare property of Dynasty Agricultural Corporation (DAC) for the City’s sanitary landfill site at Barangay Felisa.

RELATED OMBUDSMAN CASES
Leonardia is thankful that this overprice issue is finally put to rest.

“It was no joke waiting for eight years for our appeal to COA to be resolved because, aside from the suspense and anxiety of waiting for it, we also had to contend, during the intervening years, with several Ombudsman cases filed against us by our political enemies on the basis of this COA disallowance on the alleged overprice issue,” Leonardia said.

“But by God’s grace, we were also able to successfully defend, at the Ombudsman, the City’s purchase price for the sanitary landfill site that even the Ombudsman eventually dismissed all these administrative and criminal cases for lack of merit and lack of probable cause,” Leonardia added.

The mayor stressed that the city officials responsible for this sanitary landfill project, from the planning stage until the consummation of the sale, made sure that they had sufficient and appropriate legal, technical, and reasonable basis for their recommendations to his office.

This prudent compliance with the rules and sufficiency of legal and technical basis provided the grounds for our successful appeal with the COA, and our defense in the Ombudsman cases filed against us, Leonardia said.

It was the hard work of these officials that made it possible for Bacolod to be among the first LGUs in the country to put up their sanitary landfill facilities in compliance with R.A. 9003. And for that, I commend them again, as well as the SP members at that time who approved and ratified the purchase transaction, Leonardia further added.

PURCHASE TRANSACTION
The City bought the property in 2008 at P340 per square meter or for a total price of P23.8 million, which the local COA auditor initially declared to be excessive based on the report of its regional Technical and Information Technology Services Office that appraised it at an average of only P261.77/sq.m. or for a total price of P18,323,719.05, after the City consummated the sale.

The City was able to partially pay P20 million of the purchase price but was prevented from making the final payment of P3.8 million owing to the intervening COA disallowance that was issued on the transaction.

The City filed its appeal against the disallowance on July 12, 2012. On January 29, 2020, the COA Commission Proper promulgated its Decision No. 2020-220 affirming the earlier decision of COA-Region 6 on September 27, 2019 to lift and reverse the disallowance.

NO OVERPRICE
The Commission Proper (CP) ruled that the “price of P340/sq.m. or the acquisition price of P23.8 million is fair and reasonable for the property, thus, not excessive.”

In reversing the disallowance, the CP agreed with the stand of its regional office that the acquisition price of P23.8 million at P340/sq.m. is fair and reasonable, being even lower than the City’s own valuation of P360/sq.m. and the BIR Zonal Value of P400/sq.m.

It further considered that the appraisal of its technical office failed to assess the consequential damages due to possible devaluation of adjoining properties, also owned by DAC, on account of the operation of the sanitary landfill.

The COA regional office and its CP were likewise convinced by the City’s arguments and evidences that the properties used as price benchmarks by COA’s technical office are not comparable properties, and some of them even have no potential as a sanitary landfill.

OTHER EXONERATED OFFICIALS
The lifting of the disallowance also freed from liability 13 other officials of the Bacolod LGU who were made co-respondents with Leonardia in this disallowance case. They are:
a) Atty. Maphilindo Polvora, Annabelle Badajos, Engr. Teresita Guadalupe who were members of the City Appraisal Committee;

b) Various department heads namely: Ricardo Dahil-dahil of the Management Audit Services Office; Atty. Goldwyn Nifras, then Secretary to the Mayor; City Budget Officer Luzviminda Treyes; City Accountant Eduardo Ravena; and

c) Engr. Efren Canlas, Engr. Josephus Cerna, Engr. Maximino Sillo, Arch. Lemuel Reynaldo, Engr. Noel Impreso who were members of the Technical Working Group of the Bacolod City Clean & Green Coordinating Action Team (BCCGCAT); and

d) former city councilor and now Bacolod representative Greg Gasataya, who was then Chair of the BCCGCAT.* (CITY PIO)