The Cebu provincial government owes its status as the country’s wealthiest provincial government mostly to its real property assets worth P22 billion.
Provincial Accountant Marieto Ypil said this comprised majority of the Capitol’s P28.18 billion equity last year.
“The bulk of the province’s assets which increased to more than P20 billion was caused by the re-appraisal of our land holdings and other real properties,” he told reporters yesterday. Equity is assets minus liabilities, he said.
( Read: CEBU IS NO. 1 IN WEALTH LIST )
Most of the province’s more than 1,000 parcels of land are located in Metro Cebu. Their value rose due to prevailing market prices. He said real property doesn’t depreciate.
Ypil said commercial land value goes up but it will depend on the re-appraisal which is done periodically by the Provincial General Services Office.
The 2014 Commission on Audit’s (COA) Annual Financial Report showed Cebu topping the list of 80 provinces in assets and equity.
Former governor Gwendolyn Garcia, who said the Davide administration merely “inherited” assets from her term, earlier claimed that she increased the province’s assets from P5 billion at the start of her term to more than P20 billion by the time she left in 2012.
“Principally, that is because of the re-appraisal of land. That’s what contributed to the increase in assets,” Ypil said.
He said the assets accumulated through the years.
He said one governor cannot take credit for this accumulated “wealth.”
Ypil said the value of Cebu province’s real property will increase regardless of whose administration it is.
“It’s accumulated from the past years. Our equity increases just as our assets do,” he said.
He said prices of province-owned properties shot up after the Capitol auctioned off the 50-hectare Club Filipino golf course during the term of Gov. Emilio Osmena in 1989. The land purchased by Ayala was developed in the Cebu Business Park.
The old Lahug airport, once owned by the province, was also transfomred into the I.T. Park.
“The prices further shot up when more investors took interest in the province,” Ypil said.
But to Garcia’s credit, Ypil said the former governor did build the P800-million Cebu International Convention Center (CICC) and finalized the recovery of 80 hectares of prime land in Camp Lapu-Lapu from the Armed Forces Central Command in barangay Apas.
Real property are assets that are not immediately converted to cash.
In earlier reports that said the Capitol was “bankrupt” in December 2012, when former governor Garcia was suspended for misconduct, the provincial government still had its mtuli-million-peso assets but only had P90.4 million in its general fund available for day to day operations.
Ypil confirmed that the province was suddenly faced with payables and money claims of over P600 million from contractors, suppliers, and outsourced employees which left the Capitol on emergency mode with its tight “cash flow”.
“Although our liabilities were big at that time, our assets were not affected. Principally, the real property assessment and market value was also huge,” said Ypil.
He said the provincial government was having a difficulty with its “cash position” at that time.
Ypil said increased liabilities resulted from dues to contractors, suppliers, and government agencies, among others.
Ypil said it’s possible that increased liabilities will result to a decline in the Capitol’s equity, but that it will be negligible.
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