CEBU City Hall’s finance officials were reminded anew by the City Council to prepare a “prudent and realistic” budget to replace the P10.5 billion proposed by Cebu City Mayor Michael Rama.
The majority Bando Osmeña-Pundok Kauswagan (BO-PK) bloc in the council reiterated this after Acting City Treasurer Diwa Cuevas said the city has so far collected P4.2 billion out of the P6.4 billion revenue target for this year.
“Let us see first what we will have to prioritize. What’s urgent and necessary as of now,” Councilor Margot Osmeña, budget committee chairperson, told the Local Finance Committee in yesterday’s start of the council’s 2014 budget review.
Cebu City has an approved budget of P5.2 billion this year.
Cuevas said while her office exceeded its local tax collection of P1.2 blllion by P142 million, it also failed to collect the P150 million from its redemption of auctioned properties.
Assistance
The City Treasurer’s Office collected only P159 million of its P1 billion target from its joint venture proceeds from Filinvest Land Inc.
But Cuevas told the council that her office was expecting additional collections of P670 million before year-end.
Jose Daluz III, Rama’s executive assistant, said the disposal of 400 properties is expected to raise as much as P650 million.
But Osmeña said the city needs P845 million at the end of 2013.
She said the amount would cover the P4,000 balance for the senior citizens assistance, employees salaries and bonuses and financial assistance to the Persons with Disabilities (PWD).
Usable funds
Osmeña said the CTO report showed that the city’s cash in bank include General Funds worth P525 million, a P434 million trust fund, P207 million Special Education Fund and P27 million in barrio funds.
The General Fund included time deposits of P165 million and special accounts of P165 million or a total of P330 million.
If the P330 million were deducted from the P525 million general fund, the city will have P195 million in “usable” funds, Osmeña said.
Negative balance
If the P195 million is further deducted by the city’s P143 million payables, the city will only be left with P52 million in unappropriated cash.
“How come we are only left with a cash position of only P52 million? Doesn’t that mean we are spending more than what we have?” Osmeña asked Cuevas.
Cuevas told the council that a negative balance will never happen because the city government has P165 million in time deposits which they could pre-terminate anytime.
The time deposit is earning the city interest of P633, 000 per year.
Entire block
“But it’s like we are always making catch up,” Osmeña said.
She said the Commission on Audit doesn’t allow the city to pre-terminate its time deposits so it can pay some fees.
Cuevas said they are also projecting P1 billion from the city’s joint venture sale with Filinvest Inc.
The CTO also made the same projects this year but Filinvest has so far paid P159 million.
Speculative
Poblete said they are anticipating another P300 million in JV share before the year ends.
Still, Councilor Noel Wenceslao said the local finance committee should reduce their 2014 budget proposal.
Other 2014 expenditures may be included in a supplemental budget after the city completes the SRP lot disposal for example, Wenceslao said.