‘Pork’ contractors under BIR scrutiny


Some of the 12 contractors whom the Commission on Audit (COA) said are involved in dubious pork barrel-related projects have tax issues with the Bureau of Internal Revenue (BIR) as well.

The Manila Times previously reported that two of the contracting firms—Sunwest Construction and Development Corp. (SCDC) and E. Gardiola Construction—have problems with the BIR involving the filing of correct income tax returns.

DSB Construction, owned by Dante Bombales, and the Three W Builders, owned by Victoriano Ada, did not file corporate taxes this year and during previous years.

In his article, The Times columnist Erwin Tulfo said a BIR official had given him a copy of the tax records of the two firms.

“The BIR computer printout shows that DSB Construction has no tax returns filed since 2010, while Three W Builders has no file at all at the bureau,” Tulfo wrote in his column, Deadshot.

“These two companies should not only be investigated for graft or plunder but also for failing to pay their respective taxes despite the billions of pesos they made through the years,” he said.

All four contractors are included in the list of private firms that COA Chairman Grace Pulido-Tan said are under investigation for pork barrel-related anomalies that could dwarf the P10-billion priority development assistance fund (PDAF) or pork barrel scam allegedly masterminded by Janet Lim-Napoles.

Tan said in a recent House hearing that state auditors discovered that at least P16.9-billion infrastructure projects bankrolled by the PDAF of lawmakers and the Malampaya gas fund were either grossly overpriced or littered with irregularities.

The projects, implemented from 2009 to 2010 by the DPWH included SCDC involving a P1.9 billion project; Antonio V. Nidea Const. (P845 million), DSB Const. (P789 million), N-Four General Contr. (P25 million), Hi-Tone (P2.7 billion), Three W Builders (P2.14 billion), Ram Builders (P2.39 billion), I and E Construction (P1.07 billion), Algimar Const.
(P668 million), Ferdstar Builders (P822 million), Ritz Commercial (P614 million), E. Gardiola Const. (P3.59 billion) and LMG Construction (P581 million).

The Manila Times on Thursday published a story about how SCDC still managed to bag the P4.7 billion Southern Luzon International Airport (SLIA) project in Daraga, Albay province, despite having been involved in past “shady” deals.

Malacanang also on Friday asked the Department of Transportation and Communications
(DOTC) to explain how the Bicol airport project was awarded to SCDC.

In separate text messages to The Times, Malacanang spokesman Edwin Lacierda and his deputy, Abigail Valte, both tossed the obligation to explain about the project to DOTC officials, saying they are in a better position to shed light on the matter.

Lacierda said he particularly asked DOTC Undersecretary for Administration and Procurement Catherine Gonzales to respond to The Times story published on Thursday about Bicol-based construction firm, Sunwest Construction and Development Corp.
(SCDC), having been able to bag the Southern Luzon International Airport (SLIA) project in Daraga.

“[I] need to ask DOTC [Undersecretary Gonzales] on [the]airport project that you mentioned. Waiting for their response first,” said Lacierda.

The project was started during the time of former President and now Pampanga Rep. Gloria Macapagal-Arroyo and was suspended for two years despite the release of P2.1 billion from 2007 to 2012.

Interestingly, The Manila Times learned that SCDC is only an affiliate of Hi-Tone as indicated on its website. It was learned that SCDC started as Sunwest Construction and Supply in 1992 and was “just a mere affiliate of Hi-Tone Construction, and based in the Bicol Region.”

Hi-Tone is included in the list of the 12 questioned firms.

Valte echoed Lacierda’s view that it should be the DOTC that should explain the issue.
“We’ll let DOTC answer this one,” she also told The Times.

DPWH Secretary Rogelio Singson on Wednesday said the companies face blacklisting by the government if they are proved to have been involved in shady deals.

In a check with the Government Procurement and Policy Board, which oversees the performance of firms entering into government contracts, The Times learned that all 12 contractors identified by Singson and Tan as having been involved in dubious DPWH transactions concerning PDAF have not been blacklisted.

Earlier, Budget Secretary Florencio Abad and Presidential Communications Secretary Herminio Coloma Jr. said the COA’s fresh discoveries require a deeper probe to determine, among others, whether the 12 contractors should be blacklisted.

“We have to await the findings of COA, which will be submitted to the NBI-DOJ [National Bureau of Investigation-Department of Justice] for the determination of laws that may have been violated based on the factual findings,” Abad said.

Coloma explained that the COA audit findings provide basis for a case build-up by DOJ and the Ombudsman. The three agencies, according to him, are part of the Inter-Agency Anti-Graft and Corruption Committee (IAGCC) that is mandated to prosecute graft and corruption cases.

Coloma also told The Times that DPWH Secretary Singson had begun blacklisting contractors that have not complied with government rules since they assumed office.

SCDC had been identified as among the top contractors that paid very low taxes last year, prompting the BIR to raise the “red flag” on the company.

E. Gardiola Construction, which was involved in a C5 Extension project worth P578.527 million that was found to be lacking in funding cover, notice of award and contract, was also found to be not paying correct taxes.

Gardiola is owned by couple Elmer and Elaine Gardiola, who bagged a P2.3-billion contract from the DPWH during Arroyo’s time. A previous report by the Philippine Center for Investigative Journalism named Gardiola and JSG Construction, its sister company, as among the top 10 DPWH contractors in 2008.


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