Rep. Raul del Mar explains his plans to source funds for the second runway project to the board of directors of the Mactan-Cebu International Airport Authority in their May 18 meeting.
Part of P14.4B from GMCAC to be used to fund airport runway project
A second runway for the Mactan- Cebu International Airport (MCIA) may soon get underway after the airport’s authority approved to fund the project using funds generated from the airport’s private operator, GMR-Megawide Cebu Airport Corporation (GMCAC).
The members of the Mactan-Cebu International Airport Authority (MCIAA) board on Thursday passed a resolution to start the construction of the second runway on the urging of Cebu City North District Rep. Raul del Mar.
Del Mar, in a statement, said the plan is to utilize part of the P14.4 billion payment from GMCAC to build the second runway.
This after the Department of Transportation and the Department of Finance agreed to allow the MCIA Authority (MCIAA) to retain the P14.4 billion premium payment, paid to the authority by GMCAC in 2014 as upfront payment when it won the bid to operate the airport for 25 years and renovate its facilities.
However, due to existing laws, MCIAA is required to remit parts of the payment to the Bureau of Internal Revenue (BIR) and to the National Treasury. Of the payment, P4.2 billion will go to the BIR as income tax while P4.9 billion will go to the National Treasury.
From the remaining P5.3 billion, Del Mar proposed to earmark P4.9 billion as initial funding for the second runway construction, “plus another P2 billion from MCIAA’s retained earnings and such additional amount as may be necessary for the airport’s second runway construction.”
Del Mar said that the nearly P7 billion pre-identified funding sources would kick start the “project development process leading to its eventual construction.”
“The MCIAA board fully agree with (me) and passed the resolution unanimously on mass motion,” Del Mar said in his statement.
Del Mar said the P4.9 billion fund meant to go to the National Treasury remains free and could also be appropriated for the second runway project once the construction of the new terminal, undertaken by GMCAC is complete.
Del Mar said that since the P4.9 billion fund is ready to be appropriated, he encouraged the board to start the project development before losing the opportunity.
He said it is vital for MCIAA to start the project the soonest “lest we lose our competitive advantage in the Visayas and Mindanao areas to new international airports now undergoing constructions.”
Del Mar, in a separate interview, said he was particularly referring to the international airport in Iloilo and one that will be constructed soon on Panglao Island in Bohol as the new international airports might take the air traffic that should have gone to Cebu if it would not build a second runway.
The renovation of the existing terminal and the construction of the new terminal are ongoing and are targeted to be completed in 2018.
With a new terminal, air traffic is also expected to increase, thus making it more imperative for MCIAA to build a new runway, Del Mar said.