COA hands-off in approving sale, appraisal of Pond F in SRP

An aerial shot of Pond F area of the SRP. CDN Digital drone shot | Raul Constantine Tabanao

CEBU CITY, Philippines –The Commission on Audit (COA) will not be intervening in the plans of the Cebu City Government to sell some parcels of land at the South Road Properties (SRP).

This as the state’s auditing body, in a decision promulgated last January 27, 2020, dismissed the request of Cebu City Mayor Tomas Osmeña that sought its approval to hold a public auction to sell portions of Pond F.

Osmeña, in the same request, also asked COA’s approval on the proposed appraised value by the city government.

It can be recalled that the former mayor is planning to sell approximately three hectares of land in SRP through a system of unsolicited proposal or Swiss Challenge.

Lots 1-F-8-A, and 1-H-1 had a price tag of P110,000 per square meter. This means that the city could have earned a total of P3.3 billion if the sale pushed through.

Read: Bid to dispose three ha. SRP lot through public bidding pushed

‘Lack of Cause of Action’

COA cited the lack of cause of action as its reason for dismissing Osmeña’s request.

“This Commission will not act upon the amended request for approval of the sale through public auction. Under Article 444 of Administrative Order (AO) No. 270 dated February 21, 1992, in relation to Section 197 of COA Circular No. 92- 386 dated October 20, 1992, disposal of real property shall primarily be through public auction. In cases of disposition of property by the local government unit (LGU) through public bidding, COA’s approval is not necessary,” the three-page decision stated.

The decision was penned by Commissioners Jose Fabia, and Roland Pondoc, and Michael Aguinaldo, who sat as the deciding body’s chairperson.

COA stated that with the enactment of City Ordinance No. 2332 in pursuant to the local government’s fiscal or local autonomy, their bureau has no authority on approving or concurring the disposal of SRP lots.

City Ordinance No. 2332 prohibits the sale of SRP lots without council approval.

They also said selective, pre-auditing function of COA was already lifted with the issuance of COA Circular No. 2011-002 on July 22, 2011.

Different Purposes

COA echoed the same justification on Osmeña’s appeal to approve the appraisal proposed by the City’s Committee on Awards.

They also stressed that the independent appraisal valuations to be done by the COA and city government serve different purposes.

“The independent and separate appraisal to be made by this Commission is geared towards verifying the reasonableness of the floor price determined by the Committee on Awards, and is basically a post-audit function in relation to the public auction,” it said.

“Its role at this stage is to ascertain, on post-audit, that no damage or injury is caused to the government when the property is sold at public auction using the floor price set by the local government unit (LGU),” it added.

In 2018, Osmeña announced that he received an unsolicited proposal from Federal Land, the realty arm of GT Capital Holdings that owns and operates the Metrobank group, to develop three hectares of land in SRP into a mixed-use development.

GT Capital also has a stake in Metro Pacific Investments Corporation (MPIC), the infrastructure holding firm that owns the Cebu Cordova Link Expressway (CCLEX).

Read: Federal Land offers to buy SRP lot for P115K per square meter

It prompted the mayor to seek the opinion of COA whether or not the disposal of the properties through public bidding or auction should bear their approval. /bmjo