Osmeña says: Ayala couldn't use MCWD letter to justify development cost

Mayor Tomas Osmeña yesterday said the Ayala-Stateland Consortium could not use the letter of Metropolitan Cebu Water District as basis to say that MCWD had justified the development cost of the Carmen Bulk Water Supply Project.

"It shouldn't be construed that they agreed, that's already distorting it too far, it's twisting the facts," Osmeña said.

In a press statement, Ayala-Stateland has expressed disappointment over MCWD's "turnaround" of its position on the controversial development cost. MCWD has said it would no longer implement the cost during a meeting with the National Economic Development Authority -Investment Coordination Committee weeks ago.

The consortium contended, however, that based on the September 2006 letter of MCWD board chairman Saul Montecillo to the NEDA-ICC, MCWD has clarified the development cost and even cited a precedent of its refund.

"We have noted that the Water Code of the Philippines requires due process and the payment of just compensation the Philippine government has authorized the payment of such costs in special cases," the letter partly reads.

But Osmeña argued that the letter was not in any way shaped to directly say MCWD agreed with the development cost but merely clarified certain issues on the matter.

The mayor also pointed out that it was MCWD general manager Armando Paredes who signed the letter on Montecillo's behalf. This was because Montecillo reportedly authorized Paredes to answer the issues that Osmeña raised with NEDA-ICC. Montecillo reportedly has not read the letter when it was sent.

Osmeña also told reporters that he believed there is a connection between Paredes and Ayala-Stateland Consortium considering that Paredes has reportedly long been identified with Ayala.

"From the very beginning, that's what I suspected. I strongly suspect," Osmeña said.

Despite its disappointment with the MCWD turnaround, Ayala-Stateland Consortium said it is still willing to come up with a compromise agreement with MCWD, and is still dedicated to finalize the project.

On October 10, 2005, the NEDA-ICC has approved the draft water supply agreement. Based on recommendations by its Technical Working Group, NEDA-ICC reportedly "interposed no objection" to the agreement.

The approval would pave the way for MCWD to finalize the terms of reference and bid documents to launch into a price challenge. This is the time that other water suppliers can challenge the proposal of Ayala-Stateland Consortium.

Montecillo, however, emphasized that MCWD will only formally launch the price challenge once it receives the official written communication from NEDA-ICC stipulating its non-objection to the draft water supply agreement.

Likewise, NEDA-ICC has forwarded to the National Water Resources Board certain provisions of the draft agreement on tariff rates to look into and clarify. - Joeberth M. Ocao