DAVAO CITY (Mindanews / 19 August) — From May to June to July to August, September 19 is the new target date for groundbreaking in Marawi City’s ‘Ground Zero,’ the former main battle area between government forces and Islamic State-inspired groups, now referred to as ‘Most Affected Area’ or MAA.
Actual groundbreaking “may be earlier… may be a week later” than September 19, Housing Secretary Eduardo del Rosario, chair of Task Force Bangon Marawi (TFBM) told the Malacanang Press Corps on August 17 as he explained that negotiations are still ongoing with the developer – Power China – and TFBM has yet to decide on how to proceed with the project: as a “joint venture agreement that will proceed to Swiss Challenge” or “negotiated procurement” or a combination of both.
“Before, we said that the groundbreaking will be as early as May, but because of numerous issues we encountered during the procurement process, so nagkakaroon tayo ng pagbabago (there are changes) with regard to the groundbreaking. So we are now saying that it will be on September 19 — the groundbreaking — but it will not affect our target deadline of completing the Most Affected Area rehabilitation by December of 2021,” del Rosario said.
The 250-hectare Ground Zero comprises 24 of Marawi’s 96 barangays and was the city’s commercial hub until it was turned into a battleground between government forces and the Islamic State-inspired Maute Gorup and its allies from May 23 to October 23 last year.
The TFBM initially negotiated with the Chinese-led Bagong Marawi Consortium but it declared an “unsuccessful negotiation” in mid-June “because they were not able to comply with all the required technical, financial and legal requirements.”
Negotiations with PowerChina (Power Construction Corporation of China), a firm engaged in hydropower, according to del Rosario, will be completed “by the end of next week” or by August 24.
Del Rosario said the project cost for Ground Zero is “about 16.8 billion” but this is still subject to negotiations.
At the 8th All-Agency Meeting of the TFBM in Makati City on August 16, a day before the Malacanang press briefing, the indicative MAA Rehabilitation timeline presented was for negotiations to end on August 24, subject it to Swiss Challenege on August 24 to September 14, award it on September 17 and hold the groundbreaking rites on September 19.
JVA or negotiated procurement
Asked at the Malacanang briefing if the Swiss Challenge will push through, Del Rosario replied: “That is another issue that we have to address, and we were told by some government agencies that not all projects stated in the minimum development requirement can be categorized to be under the joint venture agreement (JVA). If it is a joint venture agreement, it will proceed to Swiss Challenge.”
“Now, we are identifying projects. We would like to separate it so that we will, instead of joint venture agreement that will proceed to Swiss Challenge, we would rather apply the negotiated procurement.”
Del Rosario explained that under the JVA, “it is presumed that you have a project that will be income-generating. So that is the main reason why we are having a joint venture agreement, that after the completion of a project it will become a profitable venture; and the government and the proponent will share in the profit. Since not all projects in the Marawi rehabilitation can be considered as profit-generating activity, then we have to separate that; and we are now doing the separation .”
For the other projects that will not fall under the JVA “it will be a negotiated procurement,” he said.
He said the Public-Private Partnership Center (PPP Center) proposed two modes to the TFBM “and that is to apply the build operate transfer that will take 20 months to process, and negotiated procurement. The PPP Center and other agencies are onboard in the negotiation process, so they are guiding us. And we have government technical experts like DPWH (Department of Public Works and Highways), we have ADB (Asian Development Bank) experts assisting us during the selection process, so there is a check and balance mechanism during this negotiation.”
Undersecretary Falconi Millar, secretary general of the Housing and Urban Development Coordinating Council (HUDCC) and chair of the Selection Committee, which serves as the Task Force’s bids and awards committee, clarified in the same press briefing that the Ground Zero project has 22 Minimum Development Requirements (MDR) and that the PPP Center proposed that only eight components can fall under the JVA.
“Ang suggestion ng PPP Center is to thresh out possibilities doon sa 14 components other than the joint venture agreement. Sinabi nga nila, iyong (RA) 9184 (Government Procurement Reform Act) under the negotiated procurement or the BOT (Build-Operate-Transfer) modality,” he said.
Millar explained they are pursuing the track “whether to take negotiated contract or 9184.” But he acknowledged theproblem with regular procurement is that “it would take more than 22 months to process.”
For the MDR components that are non-income generating, “we will try to thresh out the most expeditious modality for this one and adopt the joint venture modality for those income-generating components which will be subjected to Swiss challenge.”
Del Rosario was asked who would pay for the 16.8 billion peso project in Ground Zero: the government or the developer?
His response: “It depends. If it’s a negotiated procurement, the government invest(s) immediately. If it’s a joint venture agreement, it’s the developer who will invest. Yun nga ang question ko eh, bakit natin gusto pa ‘tong tayo pa mag-i-invest, the same amount din naman.”
Del Rosario said he would much prefer if government shells out money after the completion “maglalabas ng pera, after the completion saka natin bayaran – yun ang position ko. Eh illegal nga daw ang position ko (then we pay – that is my position. But they said my position is illegal) so… I rest my case. I rest my case.”
The General Appropriations Act of 2018 does not provide for funds for Ground Zero rehabilitation but has a 10 billion peso allocation for Marawi rehabilitation projects outside Ground Zero, coursed through the National Disaster Risk Reduction and Management Council.
Out of this amount, only 2.2 billion pesos have been issued Special Allotment Release Order as of August 15, as reported in the TFBM’s All-Agency Meeting last Thursday. (Carolyn O. Arguillas / MindaNews)