[ manilatimes.net ] June 29, 2011
STATE-RUN Bases Conversion and Development Authority (BCDA) on Tuesday said the non-payment by Camp John Hay Development Corp. (CJHDevco) of its rental obligations has stalled the efforts of the Baguio City government to purchase the iconic Baguio Convention Center from the Government Service Insurance System.
In a statement, Dean Santiago, BCDA vice president for Business Development and Operations, said that agreements between GSIS and Baguio City as well as BCDA and Baguio City were forged in 2003 and 2004, respectively.
Under the agreements, the funds that would be used by the Baguio City government for the purchase of the P250 million Baguio Convention Center will come from the local government’s 25 percent share of lease rentals that BCDA collects from CJHDevco.
Also under the agreement, BCDA will directly remit to the GSIS the share of Baguio City from actual rental payments of CJHDevco for the payment of the Baguio Convention Center.
In February 11, 2004, BCDA remitted to GSIS the local government’s share of P50 million as down payment for the Baguio Convention Center property. Another P50 million was remitted to GSIS on September 3, 2008 as partial payment of the said property.
Since CJHDevco has not made good its promise to pay its rent to BCDA, this in turn puts in jeopardy Baguio City’s chances to acquire the 10,000 square meter property, consisting of the Baguio Convention Center building and its facilities, the lot where the building stands, and the adjoining parking lot.
“CJHDevco’s refusal to pay its rental obligations to BCDA is prejudicial to the people of Baguio City,” Santiago said.
To date, CJHDevco has P2.4 billion in restructured arrears plus another P382 million of unpaid lease covering the period December 2009 to June 2011.
Santiago said CJHDevco’s non payment of its rentals has prevented the Baguio City government from meeting the annual payments to GSIS, resulting in interest payments reaching P128 million.
He said the total obligations for the Baguio Convention Center property stood at P328 million, broken down to P200 million in principal and P128 million in interest.
Santiago said the balance due GSIS is now down to P218 million as BCDA recently remitted to the GSIS another P60 million. The state-run pension fund waived interest charges of P50 million.
Darwin G. Amojelar
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