Sonny tied up anew in ‘something substantial’

LIGHTNING ROD: We wonder if Environment Secretary Heherson Alvarez has noticed it, but he seems to have a lightning rod that attracts a myriad bolts to himself and his patroness President Arroyo.

If he does not take any evasive or corrective step, sooner or later one of the deadly charges may score a bull’s eye on him with President Arroyo getting splattered.

The latest in the barrage of serious charges was hurled by PICOP Resources Inc. alleging that in a meeting at the Manila Hotel last April 28, Alvarez asked for "something substantial" in exchange for the automatic conversion of Picop’s Timber Licensing Agreement (TLA) into an Integrated Forest Management Agreement (IFMA) to assure its continued operations.

The conversion is ministerial and need not be that difficult, but Alvarez reportedly kept dragging his feet despite (or because of?) the knowledge that Picop’s corporate life would end shortly if it failed to get the IFMA which was to be its lifeblood and that of its 8,000 workers.

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NO FUND-RAISING?: This is a serious charge that President Arroyo and the Commission on Appointments, which is scrutinizing Alvarez’s proposed appointment to the Cabinet, cannot ignore.

The case may take on political color as some opposition quarters are insinuating that GMA and her Lakas party, where Alvarez is the secretary general, are raising a P100-billion war chest for the 2004 presidential elections.

President Arroyo may quietly intervene and rein in Alvarez considering that Picop enjoys under a Presidential Warranty "peaceful and adequate enjoyment" of the "exclusive right to cut, collect and remove sawtimber and pulpwood" in its 184,000-hectare area in Bislig, Surigao del Sur.

Just because the Presidential Warranty was granted in 1969 by then President Marcos need not be converted into a side issue by Alvarez, a victim of martial rule. As a legitimate and responsible business, Picop contributes to the Arroyo campaign to create jobs and raise (government) revenues.

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AUTOMATIC PROCESS: Vicsmarte E. Ubalde, Picop corporate information officer, explained that the conversion of Picop’s TLA 43 into an IFMA is an automatic process under Section 9, Chapter III, of the DENR’s own Administrative Order 99-53. The DENR secretary has no discretion on its approval as it is an automatic process triggered only by the TLA holder’s letter of intent and satisfactory performance.

He recalled that on Oct. 26, 2001, Alvarez wrote Picop saying that "consistent with our attached memorandum (to President Arroyo) and in response to your Letter of Intent dated Jan. 25, 2001, xxx we have cleared the conversion of Picop’s Timber License Agreement (TLA) No. 43 to Integrated Forest Management Agreement ( IFMA ) effective from the expiration of said TLA on April 26, 2002."

That should have cleared the way for the conversion, a fact that Alvarez himself affirmed in a meeting with Picop president Teodoro G. Bernardino on April 28, 2002.

Everybody expected the process to move on to the next stage of signing the IFMA documents, which in the first place is ministerial on the part of the DENR. Alvarez himself said in an Oct. 17, 2001, memo to President Arroyo that ‘we shall be using the IFMA guidelines for the said tenurial instrument.’

The pro-forma documents requires only filling in the blanks for the IFMA signatory and the particular circumstances of the IFMA area and proponent.

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PUZZLING SUDDEN VETO: But on April 24, 2002, Ubalde recalled, Alvarez suddenly withheld approval of the first of seven items in the two year Transition Development and Management Plan (TDMP) submitted by Picop. The plan had passed the processing from the local, provincial and regional DENR levels.

As Item #1 concerns the harvesting of sawtimber and pulpwood, Picop objected to its non-approval. This is an essential item in the Presidential Warranty granted as a condition for investors and financiers to fund the project.

Alvarez knew that approval of the rest of the items in the TDMP was meaningless without Item #1 (harvesting plan) and that the warranty is continuing and still valid for as long as Picop continues to operate.

Ubalde said that the pressure tactic applied by Alvarez was puzzling considering that "Picop is a listed company, directly and indirectly employing over 8,000 workers (but has already laid off thousands with his squeeze), and a loss of about P200 million/year in revenue for the government" – until Alvarez invited Picop officials to a meeting on April 28, 2002, a Sunday, in Room 1702 of the Manila Hotel.

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‘SOMETHING SUBSTANTIAL’: Recalling the meeting, Ubalde said that Alvarez confirmed that the conversion was a completed process, that he was willing to recognize the Presidential Warranty but that he would want ‘something substantial’ before he approved Picop’s harvesting plan.

He even tried to soften the blow by saying, Ubalde added, "Alam ko naman na ang Picop ay nagigipit at ito namang kapalit ng inyong TDMP ay hindi masyadong makagigipit dahil marami naman ang inyong mapuputol dahil sa aking ia-approve."

Now, what does that mean? To force Alvarez to face and answer the issues squarely, Picop has filed a case against him.

It cannot be determined yet if Alvarez’s allegedly asking for "something substantial" and his disregard of a Presidential Warranty were on his own or with the go-signal of President Arroyo.

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ALVAREZ DENIES STORY: Alvarez denied having asked for "something substantial." He said "this is a foolish, stupid lie."

"We could not renew the permit because a Presidential Warranty is crony capitalism, which violates the good governance rules of President Arroyo," he said. "It is being used as a coverup for their failure to fulfill the basic requisites, including its corporate registration."

He said Picop should "first comply with the very basic requirement for a corporation – a legitimate Securities and Exchange Commission registration, plus payment of taxes, and undertaking to protect the forests – all 184,000 hectares under their logging concession."

He said that the IFMA requires that all financial obligations of the company be settled with the government, otherwise, there could be no automatic renewal of franchises.

"The Presidential Warranty of then President Marcos was an exercise of martial powers granted to a handful of Marcos cronies and dislocates a competitive market," Alvarez said.

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