Vice Mayor Michael Rama is concerned about the commitment fees of the loan for the Bus Rapid Transit (BRT) project. | Delta Letigio
CEBU CITY, Philippines — Cebu City Vice Mayor Michael “Mike” Rama said he is concerned with the committment fees the Bus Rapid Transit (BRT) project have incurred five years after loans were taken to fund it.
According to a recent Commission on Audit (COA) report, the national government has to pay P23 million worth of committment fees after it was not able to utilize the P10.6 billion loan it incurred from the World Bank for the project.
A commitment fee is a fee levied on undisbursed portion of the loan, payable in the currency in which the loan is denominated.
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The delay of the implementation of the BRT since 2014 has caused the accumulation of committment fees over the years, payable to the World Bank by the national government, which took the loan for Cebu City on 2014.
Rama said the delay is attributed to the many changes over the years on the project especially the routes, with the Department of Transportation (DOTr) proposing the BRT to start from the South Road Properties (SRP) to IT Park in Barangay Apas.
In an executive session on August 20, 2019, the City Council investigated the BRT project and found that no significant progress had been done because the acquisition of land for the road widening had taken up most of the time since 2014.
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Now, Rama said the council would have to step in on the plans of the DOTr for the changes and demand to see this plan to either approve it or not.
“There should be a concurrence with the council. If there is going to be variations in the project, it should be approved by the City Council ,” said Rama.
Rama said the BRT had taken so long when the original plans were supposedly approved by the National Economic and Development Authority (NEDA) years ago.
The new changes proposed by DOTr will once again need the approval of NEDA bringing back the BRT to square one.
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This, in turn, delays its implementation and incurs more fees for the national government for the unused loan.
Rama said he would meet with the council members to tackle their legislative move to hasten the BRT and to help the national government to stop incurring committment fees.
In particular, the council will help make the land acquisition easier so the road widening can be hastened.
Rama said he was still hoping the original plan would be implemented because it was what the Cebu City residents needed.
He encouraged the national government to simply release the money for the land acquisitions to hasten the process./dbs