December14, 2006

Atty. Geraldine Baniqued
City Legal Officer

Mr. Rafael Baraan
City Administrator

Thru: Benjamin S. Lim
City Mayor

Dear Mr. Rafael Baraan and Atty. Geraldine Baniqued,

Thank you very much for the reply letter from the City Legal Officer dated December 13, 2006 in reply to the letter of clarification dated December 7, 2006.

Issues that need to be clarified.

1. The Sangguniang Panlungsod was just being respectful and courteous in its non action towards the letter of the Mayor dated January 10, for him to be authorized by the Sanggunian to negotiate with a developer for the Magsaysay Park. On October 25, 2004 Resolution 4678-2004 was passed pinpointing the Magsaysay Park as a Tourism Park with recreational facilities (not a Tourist/Commercial complex). The Sanggunian was being kind to the Mayor by not formally rejecting request for Negotiation, since the Mayor’s request at that time did not have any basis. Letter of the Mayor to the Sanggunian requesting that the Mayor be granted authority to enter into a Memorandum of Agreement with a reputable firm to develop said property into a tourist/commercial facility. The request seeking an authority to negotiate should only be done as a last recourse if there are failed bidding on any approved and authorized project.

2. The job of the City Legal Office is to protect the interest of the City. May we request a direct reply on the where about of the remnants of what used to be the Bugnay Commercial Complex? You have stated in your previous reply letter that there was already a turnover of what used to be the Bugnay Commercial Complex. A confirmation from the City Engineer, Waste Management Officer and City Agriculturist who have in their jurisdiction huge lots which could accommodate tons of steel structure confirmed that they do not have in their possession said former Bugnay Commercial Complex or its remnants. Please make a clarification as a City Legal Officer if the city has a right to get the remnants of what used to be the Bugnay Commercial Complex (Magsaysay Commercial Complex).

3. Section 302 of RA7160 is the manner in which an LGU is to deal with a BOT technical plan to be bided out does not contradict with RA 6957 as amended by RA7718 of the BOT Law, therefore is not repealed but remains to be in force. Therefore, the Sanggunian must authorize the minimum basic technical requirement to be technically planned by the City Engineering upon written request by the City Mayor before a BOT bidding is to be conducted. Thank you for your correction, that the Sanggunian received such a plan on November 27 after the bidding was completed and awarded to Metrostate.

4. May we have a direct reply on how we shall now deal with Metrostate? It is a separate Juridical Personality that does not have a PCAB license during the time of bidding and was never pre qualified and qualified. It is S&F and LXS that were qualified. May we request a direct reply on the transferability of the PCAB license of LXS to Metrostate? Is this allowed?

5. Please do not go away from the BOT project being requested for clarification. The BOT project is a Commercial Complex and not an Expressway or Highway that shall demand Toll Fees. The treatment of a Tolled Highway is different from the one being requested clarification. WE are merely requesting the official legal opinion of the City Legal Officer as regards to the provision that the Local Government Unit concerned shall approve of the FEES, RENTALS and CHARGES as stated in the BOT Law. It is only to clear that the bidding did not consider said provision of the law. The reason why the BOT put this provision is for the LGU to determine the best offer in terms of infrastructure and lease rental it could get basing from what the BOT operator is to earn during the duration of the contract. It is a simple financial analysis that any accountant could do using the Present Value.

6. May we also request what Franchise the city legal officer is talking about?

7. The City Legal was gracious enough to state that the city stands to gain 9million pesos in local revenue from the establishments that shall occupy the commercial complex to be built by Metrostate. The city legal assumed that each of the 18 establishments shall be paying 500,000pesos per year for local taxes. To simplify the computation, these 18 establishments must declare a total sales of 1.2billion in a year or 100million pesos a month to achieve the 9million pesos annual local revenue BASED ON HOW THE CITY COMPUTES ITS LOCAL TAX. It will be equivalent to having declared gross sales of 5.555million pesos per establishment per month. In a daily basis, the City Legal forecasted EACH ESTABLISHMENT shall be having 185,200 pesos gross sales per day in selling coffee, hamburgers and other food products (please verify this computation from One Stop Shop Business Center). If this shall be the case, then there is indeed a need to ensure that the city will have a fair deal with any future BOT the Sanggunian may authorize by fully enforcing the mandate of the Law that it shall be the LGU concerned that shall approve the proposed fees, rental rates, and charges that a BOT operator is to bid.

Since you touch on the economic aspect of the project, may I again remind the status of the mall type Malimgas Market which is not earning revenue for the government. Records will show that the Malimgas Market collection in 2005 is about 20million pesos. The city however is spending almost 40million pesos for its yearly operation as reflected in CY2005. As of present, the mall type market has lost more of its tenant and continues to lose its tenants in the air conditioned second floor. Would the City Administrator suggest the repackaging of the Malimgas Market into a Tourism/ Commercial Market basing from the City Legal Officer’s forecast on sales of fast food chains in the city? Would the City Administrator proposed a leasing out of the 3rd and 4th floor of the Malimgas Market? Not only will the forecast increase the City’s local revenue, but it shall erase the city’s subsidy to the tune of 18.6million a year just to operate the Malimgas Market. The city will be saving 18.6million of subsidy expense for the Malimgas Market and at the same time the city could use the 18.6million pesos for its other programs. The Sangguniang Panlungsod through the Committee on Market and Trade and Industry has been pounding on the promotion of the Malimgas Market.

8. The Sangguniang Panlungsod Committee Report is different from the Sangguniang Panlungsod Resolution. May we request the opinion of the City Legal as regards to the required Regional Development Council Resolution for BOT projects in excess of 50million pesos. Is the Committee Resolution of the Executive Committee strong enough to comply with the requirement of the Law seeking for the Regional Development Council Resolution? The BOT was specific that for projects above 50million pesos, there is a need to secure the Regional Development Council’s Resolution, not the Executive Committee or any other committee’s resolution which was submitted to the Sanggunian on November 28, 2006 as reflected in RDC EXecutive COMmittee Resolution No.66 series of 2006.

May we propose a re bidding in the said BOT project and this time with people’s participation in the decision of leasing out the Magsaysay Park for another twenty five years.
The Sanggunian is united with the Mayor in the progress of Dagupan City. We are in unison with the vision of Dagupan as “We envision Dagupan City as the premier center of the north for education, information technology, health, commerce and trade, and aquaculture, supported by God-loving, well-informed, healthy, self-reliant, empowered and vigilant citizenry steered by firm, decent and progressive leaders, towards a globally competitive, diversified and environment-friendly economy in a balanced, planned, attractive and safe environment”.
There is nothing to lose in ensuring that the mandate of the law in any BOT project is complied with in the city of Dagupan. The city stands to gain more of the respect of the people if we make them a part of the decision in leasing out via the BOT, the Magsaysay Park to a private entity for another twenty five years.
Lately, the city government has been preaching good governance in the monthly PGS Seminar at the city museum. The four pillars of which are Participation, Accountability, Transparency and Performance. Let these be our guiding principles. Let us practice what we preach.
Mahal natin ang Pilipinas! Mahal natin ang Dagupan!
Together let us make Dagupan great, not only in physical structure but also in values.

Respectfully,

Sgd.
Alipio Vittorio Ramon D. Fernandez
City Vice Mayor and Presiding Officer

cc: ALL SP Members

Vice Mayor Alvin Fernandez joins Councilor Farah Decano in the formation of a federated student council of dagupan. The Sanggunian Panlungsod took care of the initial logistics to organize the student council into a federation for them to have a say in the affairs of governance in the city.

VM Alvin inspires students to be vocal on their ideas on how to make dagupan better. He stressed the need for students participation on local laws affecting them. Every one must participate. Inaction and indifference are acts of repudiation of the rule of law.

Principals of Public National High School in Dagupan attended the hearing of the Sangguniang Panlungsod to air their concern on the Maintenace and Other Operating Expenses of their school. They are requesting for assistance from the city government on how their MOOE will be increased.
As of present, the city gives the Special Education Fund coming from the Real Property Taxes of the city.

The Sanggunian Panlungsod has just received a listing of cancelled Certificates of Alienability and Disposability from OIC PENRO Officer Rogel Pimentel. It also received a listing of all Tax Declaration issued by the city Assessor's office based on the certificates of Alienability and Disposability presented by the occupants. The Sanggunian has also requested the presence of the former Tondaligan Park Administrator Juanito "Ani" Lagao to grace the Sangguniang Panlungsod session and to bring with him the documents he claims are proof that there are lands inside the Tondaligan Park that were sold for billions of pesos.

The city government has taken the positive step in applying for the questioned accreted foreshore land to be developed into a Special Economic Zone. So far more than 30 hectares have been processed upto the Regional Level of the DENR awaiting for the approval of Secretary Angelo Reyes. The application of the city is to reach more than 90 hectares basing from old and new accretions in the bonuan beach area.

Occupants are deemed illegal and shall have their Tax Declaration cancelled by the city basing from the cancelled Certificates of Alienability the PENRO has provided. As of present, the city vice mayor has requested OIC PENRO Rogel Pimentel to ensure that all certificates cancelled by CENRO are complete and shall match the Tax Declaration occupying the accreted land list submitted by the assessor's office.

In the first place, these FORESHORE lands could not be considered as Agricultural Land. These are beach front properties and are for the use of the state or the Local Government Unit who has territorial jurisdiction over them. Only Agricultural land are subject to Certificates of Alienability and Disposability.