Repeal of law making water utilities government-owned sought

CAGAYAN DE ORO CITY (MindaNews/01 June) — Advocates of the conversion of this city’s water district into a cooperative said they will ask Congress to repeal the law that requires all water districts in the country to be government-owned-and-controlled at the local level.

Dr. Anselmo Mercado, chair of both the Cagayan de Oro Cooperative Development Council (CCDC) and the Water Service Cooperative had said that the Provincial Water Utilities Act of 1973 (Presidential Decree 198) has been the main stumbling block to their quest to take over the Cagayan de Oro Water District (COWD).

“We feel that there is a need to review this decree and open up the possibilities for other models of ownership, control, operation and management of water facilities,” Mercado said in his letter to Ating Koop Party-list Rep. Isidro Lico.

MindaNews obtained a copy of the letter from the Cooperative Development Authority regional office here.

It may be recalled that in August 2009, CCDC organized a consortium of millionaire cooperatives in the city led by the First Community Cooperative (FICCO) to buy out the COWD which was then cash-strapped prompting the Bureau of Internal Revenue to garnish its assets in the banks after failing to pay its unpaid taxes for several years.

“We can turn the cash flow of the facility from negative P7.4 million to P123.5 million,” Mercado said in explaining the reason behind the planned acquisition.

In a phone interview Wednesday, CDA 10 regional director Orland Ravanera said he will meet with Cagayan de Oro’s party-list and district representatives in their office in Manila, Tuesday next week, to discuss and possibly draft a House bill that will make water districts in the country open to privatization.

“I also call on our local legislators—(1st district Rep.) (Benjamin Jose) Benaldo, (2nd district Rep. Rufus) Rodriguez and Abante Mindanao Party-list Rep. (Maximo) Rodriguez—to join us in our movement to repeal PD 198,” said Ravanera.

“They should take it upon themselves to advance the cause of the people,” he said.

The proposal to convert COWD into a cooperative was revived after it submitted a proposed 30-percent increase in water rates to the Local Water Utilities Administration (LWUA).

City councilors Ian Mark Nacaya and Alden Bacal, who chairs the committee on public utilities, both expressed support to convert COWD into a cooperative in separate interviews Tuesday.

Asked to comment on the councilors’ stand, Ravanera said that “it is about time for them to support the best interests of the member-consumers.”

“We have already showed that the increasing non-revenue water (NRW), ancillary charges and not to mention the perks the board of directors enjoy are affecting the efficiency of the water facility the burden of which will be shouldered by the consumers,” he said.

He said that if the ancillary charges, board of directors’ perks and increasing NRW are addressed there may not be a need to increase water rates.

Ravanera said “water consumers will be willing to pay as long as the utility is managed well. They should be prudent and judicious in their perks.”

“The cooperative movement will make sure a law will be crafted (which will) enable us to convert COWD into a cooperative,” he said.

However, Ladele Sagrado, COWD acting public relations division manager said in an interview Wednesday that the last time they increased their rates was in 2007.

“We have to increase our water rates because all of the consumables, e.g. fuel, pipes, etc. we use to sustain our operations have all increased as well. Supposed to be last year pa yan kaya lang we reconsidered because commodities and all other bills have increased also,” Sagrado said.

“Actually, it’s a series of increases. 30 percent this year, 10 percent in 2014 and 10 percent 2017,” she said, adding the increases they implemented in 2007 funded their service expansion project which focused mainly on pipeline rehabilitation.

“Since the COWD is the very first water district in the country, you can just imagine how old the pipes are,” Sagrado said.

The proposed 30-percent increase will fund the other projects such as procuring electromagnetic flow meters which Sagrado said are more accurate in monitoring leakages.

COWD will also use part of the funds from the increase in purchasing up-to-date devices which in return will contribute to a better and more efficient water facility, she said.

“As for the perks they are saying, the entire honorarium the board of directors received are set and categorized by LWUA,” she said.

“The perks are always supported by LWUA guidelines,” she stressed.

In another development, Sagrado denied that COWD is already a cooperative.

“We have an employees cooperative here but it is not managing the COWD,” she said. (Cong B. Corrales/MindaNews)