Pledging session for Marawi rehab set for Nov. 28 in Davao City

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DAVAO CITY (MindaNews / 25 November)  — The funding requirement to make Marawi City “bangon” (rise) by end of 2021 is P64.58 billion pesos but how much of this amount has been raised and how much is set to be raised during the pledging session here on November 28?

Housing Secretary and Task Force Bangon Marawi (TFBM) chair Eduardo del Rosario said the amount does not include the proposed 20.05 billion peso compensation fund which is still pending in Congress.

The pledging session involving development partners comes 18 months after residents of the country’s lone Islamic city were forced to flee as government forces and the Islamic State-inspired Maute Group and its allies turned their villages — particularly the 250-hectare, 24-barangay Ground Zero — into their battleground.  Ground Zero is now referred to as the Most Affected Area or MAA.

Del Rosario said the Department of Finance (DOF) is spearheading the pledging session.

Buildings lay in ruins after the five-month battle to retake Marawi City from ISIS-inspired terrorists. Photo taken Tuesday (24 October 2017). MindaNews photo by MANMAN DEJETO

According to a report posted at the DOF website, Finance Secretary Carlos Dominguez told Japanese officials in a meeting last Wednesday that  the pledging session “will mark a significant milestone in the Philippine Government’s financing strategy towards the comprehensive recovery and reconstruction of Marawi City and provide us the opportunity to thank our development partners, including Japan, for their generous commitments of support.’

Dominguez told MindaNews on Saturday that the pledging session is separate from the launch of the Marawi bonds, another means of raising funds for Marawi’s rehabilitation.

No date has been set for the launch of the bonds although a DOF press release on November 6 said they intend to issue, initially, P13.5 billion worth of retail bonds in the domestic market.

64.58 billion pesos

In his presentation at the Mindanao Media Forum on ‘Reporting Mindanao: Peace, Martial Law and Marawi Rehab’ held here on November 16, then Undersecretary Falconi Millar, then head of Secretariat of the Task Force Bangon Marawi (TFBM),  said the the Marawi rehabilitation fund is  64.58 billion pesos broken down as follows;  47.5B for the BMCRRP; 15B for MAA; 1.2B for livelihood and 882 million for the reconstruction of mosques.

In previous press briefings, the P20.05 billion proposed compensation fund for those who lost their houses and shops and livelihood, was included. Asked at the media forum why it was taken out, Del Rosario replied: “We were told by the DOF not to put that in because the bill is pending in Congress. We would like to have the figure in totality but since it is not yet approved by Congress and it is still being deliberated upon, so we were told by DOF not to include that yet.”

Task Force Bangon Marawi chief Eduardo del Rosario, speaking during Mindanao Media Forum on Nov. 16,  2018 in Davao City, said the Master Development Plan for the Marawi rehabilitation will be done in two weeks. MindaNews photo by BOBBY TIMONERA

The reconstruction of the 25 mosques that were destroyed during the war in Marawi is among the projects the TFBM would ask development partners to fund since government cannot allocate funds for religious purposes due to the constitutional provision on separation of church and state.

“Government cannot provide funds for the reconstruction of the mosques but we have … Muslim countries and even non-Muslim countries” that can help, Del Rosario said in his speech at the groundbreaking rites for the MAA on October 30.

How much has been raised?

Of the 64.58 billion peso funding required, government has allocated under the General Appropriations Act of 2018 the amount of 10 billion pesos for the priority Programs, Projects and Activities (PPAs) under the Bangon Marawi Comprehensive Rehabilitation and Recovery Program (BMCRRP) which covers areas in Marawi that are outside Ground Zero.

According to the DOF press release on November 6, three funding sources for specific projects have been identified: 5.44 billion pesos from the Asian Development Bank in the form of an Emergency Assistance Loan, 10 billion from the GAA of 2018 and 13.5 billion from the sale of the first tranche of the Marawi bonds — or a total of 28.94 billion.

The Marawi bonds, however, has yet to be launched, leaving only 15.44 billion presently funded.

The 10-bilion peso fund for the BMCRRP in 2018 was lodged with the National Disaster Risk Reduction and Management Council (NDRRMC).

MindaNews checked the website of the Department of Budget and Management (DBM) and found that only 5.4 billion of the 10 billion peso fund have been issued Special Allotment Release Orders (SARO) as of November 23, 2018.

Last week, the House approved on second reading, House Joint Resolution 32, to extend to December 31, 2019 the availability of the 2018 appropriations for Maintenance and Other Operating Expenses and Capital Outlays.
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This would allow for the remaining 4.6 billion of the 10 billion peso fund allocated for 2018, to be used in 2019.

For 2019, the proposed allocation for Marawi’s BMCRRP in the GAA is 3.5 billion pesos.

Earlier, Millar told MindaNews the total funding requirement for the BMCRRP in 2019 is 6.95 billion pesos.

Take away 3.5 billion which is to be funded under the GAA, there is a funding gap of 3.45 billion.

The November 6 DOF press release said that according to the DOF’s International Finance Group (IFG), “the funding gap of P3.45 billion would be raised through a pledging session with development partners sometime in November.”

The press release noted that the DOF was “planning to initially issue P13.5 billion worth of retail bonds in the domestic market to help raise funds for the ongoing reconstruction and rehabilitation efforts in the devastated city of Marawi in Mindanao.”

The Bureau of the Treasury in its report to Dominguez said the initial bond issue, dubbed by Dominguez as “Marawi Bonds Series 1” would have an appropriations cover of the same amount based on the P10 billion allotted this year under the national budget for the BMCRRP, and another P3.5 billion for 2019.

“As we need money later on, we will issue more bonds,” the DOF press relesae quoted Dominguez as saying.

Funding the MAA rehab

Where to source funds for the 15-billion peso MAA rehabilitation is still being discussed.

It could come in the form of a congressional allocation, if the Master Development Plan (MDP) is submitted to Congress which for the 2019 GAA is too late, the tapped from unprogrammed funds or from emergency funds.

Del Rosario told the media forum here on November 16 that the MDP would be finished “in two weeks” or by November 30.

“That plan is now 95 complete and in two weeks time it will come out,” he said.

The National Housing Authority (NHA), the implementing agency of the MAA rehab, has allocated 75 million from its corporate funds, to finance the debris management of Sector 1, the pilot project for the MAA.  Sector 1 comprises only one of the 24 barangays — Tolali.

Asked at the media forum where they would source funds for the MAA rehabilitation, Del Rosario replied: “We communicated with DBM and per instruction by DOF that TFBM, NEDA (National Economic Development Authority), DOF, and DBM sit down together and we sat down last week. There is an unprogrammed appropriation that can be tapped, that will be opened up once the … NHA has submitted funding requirements for 2019.”

He said the unprogrammed appropriation is “about 9 to 10 billion” but quickly added he was not sure of the exact amount, “but we were told that 5 billion is ready.”

He said the “unprogrammed appropriation for 2018 can be tapped now, that can be unlocked and be used for 2019 as long as we obligate it within 2018, so that answers your question with regards to funding requirement for 2018 that will spillover to 2019.”

The DOF press release on November 6 said the World Bank “plans to pool contributions, in the form of grants, from the Philippines’ development partners under a proposed Bangon Marawi Multi-Donor Trust Fund to assist in the implementation of the Government’s BMCRRP.”

It said government also requested the World Bank to establish a Project Monitoring Unit (PMU) under the TFBM to monitor the implementation status of all programs, projects, and activities identified in the BMCRRP.

The DOF has requested all implementing agencies to submit status reports on all programs, projects, and activities they are handling to determine financing gaps. (Carolyn O. Arguillas / MindaNews)

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