Cebu Capitol, DBP to sign loan deal to fund LGU’s infra projects

April 30, 2009 11:02 am 

CEBU CITY, April 29 — Cebu Gov. Gwendolyn Garcia is set to enter into a memorandum of agreement (MOA) with the Development Bank of the Philippines (DBP) on the granting of a “soft loan” for municipalities and component cities for their infrastructure projects.

Cebu Provincial Board (PB) Member Juan Bolo filed a resolution which was passed on mass motion authorizing Garcia to enter into an agreement with DBP on the granting of loans to the municipalities and components cities.

”Due to numerous requests, the Province, by way of economic enterprise and assistance, wishes to provide loans to its components cities and municipalities to finance the latter’s infrastructure and other devilment projects,” the resolution stated.

Cebu PB member Wenceslao Gakit Jr. head of the appropriations committee, said the Provincial Government will start accepting proposals from different government units once Garcia signs the agreement.

The agreement is seen to be the solution to financial problems besetting the cities of Bogo, Carcar and Naga whose conversions into component cities were earlier nullified by the Supreme Court (SC).

The mayors of the cities of Bogo, Carcar and Naga are racing against time to overturn the SC’s latest decision amid the current economic meltdown.

They earlier announced that they would file their second motion for reconsideration and ask for financial assistance from the President to finish their infrastructure projects which were implemented when their IRA as cities increased.

Carcar and Naga reportedly registered triple IRA share since their conversion into cities in 2007. With the SC ruling, Carcar is worrying that its P270 million in IRA share will drop to P90 million.

Naga’s P180 million in IRA share may also drop to P66 million if the ruling takes effect.

Capitol chose DBP since the latter “has experience, expertise and mechanism in the evaluation, processing and grant loans to government agencies and local government units (LGUs)."

The Province has sought the assistance of DBP in the processing and grant loans to qualified LGUs-applicants.(PNA)

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