Danao officials told to return P64M

CEBU – Government auditors have questioned the release of at least P64 million as advance payment for a contractor of a bulk water project in Danao City, Cebu.

The Commission on Audit (COA) issued a notice of disallowance, requiring Mayor Ramon “Nito” Durano III, four City Hall officials and a contractor of the project to return the amount to the city government.

“The amount of P64,483,461 was disallowed in audit because advance payment for mobilization expenses was not recouped,” read the twopage notice signed by state auditors Lita Lamparas and Cymbeline Celia Uy.

The auditors disallowed last April the P64 million the city had released to Peter John Van Haren, chief executive officer of Wiik & Hoeglund Public Co. Ltd., because the water project was not fully implemented.

“The implementation of the project has not been continued, thus no additional payments have made from which the recoupment could have been deducted from,” the auditors’ notice dated April 14, 2014 read.

In a text message last night, Mayor Durano confirmed that his administration is bent on finishing the project, adding that the city is just waiting to finalize its contract with the Metro Cebu Water District (MCWD).

He pointed out that finishing the project was his 2013 campaign promise to his constituents. “I believe it is one of the reasons why I got an overwhelming vote,” he said.

The mayor added he will issue an official statement later “so it will be well explained.”

Status report

In May last year, the Danao City Council passed a resolution authorizing Councilor Oscar “Boying” Durano Rodriguez to conduct inquiries on the status of the bulk water project.

Rodriguez, who sponsored the resolution, had said the City Council wanted to know how much damage the government incurred when the project was stopped, because of the alleged refusal of former mayor Ramon “Boy” Durano Jr. to sign documents required for the project.

But Boy Durano had said his administration failed to implement the bulk water project because the City Council, then under his younger brother and former vice mayor Nito, did not cooperate.

Before the May 11, 2010 elections, then mayor Nito Durano had signed a supply contract with the MCWD for the P450-million Danao City Bulk Water Project to supply 20,000 cubic meters of water to MCWD at P21.50 per cubic meter.

But they later revised the contract because they wanted to increase the supply to 25,000 cubic meters and add the escalation clause.

City officials had feared that within the contract period of 15 years, power rates would increase and that would leave the City with no room to profit from the project. (GMD/WITH OCP)