35 present, past govt officials face graft raps over Boracay waterworks deal


THIRTY-FIVE incumbent and former government officials are facing graft charges before the Office of the Ombudsman stemming from an agreement in 2009 for a joint venture in the operation, management, and maintenance, among others, of the Boracay Waterworks and Sewerage System (BWSS) facilities.

Named respondents in the complaint were: former Philippine Tourism Authority (PTA) General Manager Mark T. Lapid and the then-PTA board members: former Tourism secretary Ramon R. Jimenez Jr., former Public Works secretary Rogelio L. Singson, Luwalhati Antonino, former Environment secretary Ramon Jesus P. Paje, Carlos Honorio B. Estepa Jr., Vivian D. Otaza, and Lucas M. Nunag, Teresita D. Verde, Lydia T. Cosuco, Edgar T. Bocar, Joy M. Bulauitan, and Miguelita A. Mariano.

PTA is now the Tourism Infrastructure and Enterprise Zone Authority (TIEZA).

Also named respondents were then-TIEZA board members: former Tourism secretary Wanda Tulfo-Teo and husband Roberto U. Teo, Marco M. Bautista, Pocholo J.D. Paragas, Interior department Officer-in-Charge Eduardo M. Año and Assistant Secretary Epimaco Densing 3rd, Environment Secretary Roy A. Cimatu, Analizah R. Teh, Public Works Secretary Mark A. Villar, Karen Olivia V. Jimeno, Anthony Edsel, Conrad F. Tupaz, Maximilian Anthony E. Fernandez, and Tourism Promotions Board Chief Operating Officer Cesar D. Montano, Datu Abul Khayr D. Alonto, Elizaldy S. Co, Roy B. Martin, Maria Vida H. Stoifl, and Catherine B. Turvill.

Also included were Boracay Island Water Company (BIWC) incorporators: Virgilio C. Rivera Jr., Luis Juan B. Oreta, Frank Beaumont, and former Energy secretary Jose Rene D. Almendras.

In a complaint filed before the Ombudsman on May 8, Boracay Island residents Rod G. Padilla and Roberto V. Gelito accused the respondents of violation of Sections 3(e) and 3(g) of the Republic Act (RA) 3019 (the Anti-Graft and Corrupt Practices Act).

“Respondents, in connivance with one another, violated Section 3(e) of RA 3019 for giving MWCI unwarranted benefits, advantage or preference through manifest partiality when they rigged the process of PTA in selecting MWCI as its joint venture partner for the Project contrary to the JV Guidelines…,” Padilla and Gelito alleged in the complaint.

JV is joint venture. MWCI is Manila Water Company, Inc.

According to the complaint, the PTA and MWCI entered into a joint venture agreement on April 21, 2009 “to establish a joint venture for the development, financing, design, engineering, construction, upgrade, testing, commissioning, operation, management and maintenance of the BWSS facilities and operation and maintenance of drainage facilities.”

The PTA and MWCI then incorporated the BIWC. On December 17, 2009, the PTA and BIWC executed a concession agreement.

The complainants alleged that BIWC was given unwarranted benefits, advantage or preference through manifest partiality “when PTA granted BIWC the sole and exclusive right to operate and manage the BWSS system despite the constitutional prohibition on exclusivity of franchises or authorizations in the operation of public utilities.”

“In sum, at the expense of being repetitious, the said Joint Venture Agreement (JVA) entered into by the parties, through the respondents, is grossly disadvantageous to the Government or to the PTA, in particular,” they alleged.

“Through the said JVA, the respondents made it appear that the capital contribution or equity of the PTA to the Joint Venture Company (JVC) or Boracay Island Water Company (BIWC) is only P60,000,000.00 or twenty percent (20%) of its authorized capital stock, hence, compliant with the provisions of the 2008 Joint Venture Guideline, when in truth and in fact, for reason or reasons only known to the respondents, they unlawfully did not consider the contributions of the PTA, particularly its investments in the existing water rights; its investments in the BWSS water supply and waste water facilities, including the existing PTA/Boracay drainage facilities…In short, these facilities were given to BIWC for free or without cost,” they alleged.

The PTA, according to the complainants, was allegedly “illegally deprived” of income, particularly the concession fees equivalent to five percent of the JVC’s gross income.

They alleged that the JVA “authorized MWCI to advance payment of the Concession Fee to the PTA in the amount equal to the subscription payment of P60,000,000.00, which is obviously a loan of the PTA from the MWCI, the amortization payments of which should be offsetted against PTA’s Concession Fees equivalent to five percent (5%) of the annual gross revenue within the period of 10 years from the signing of the Concession Agreement or until paid.”



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