CLARK FREEPORT – A multi-billion peso debt from an accumulated unpaid electric bill since 2004 is now burdening Olongapo City.
At the Balitaan forum of the Capampangan in Media at the Bale Balita here last Friday, newly-elected Olongapo City Mayor Rolen Paulino revealed that the city has incurred a P5.1-billion debt in unpaid electric bill from the National Power Corp. (Napocor) since the time of former Mayor Kate Gordon, wife of former Senator Richard Gordon.
As a result, the state-run Power Sector Assets and Liabilities Management Corp. (PSALM) was set to disconnect the city from the Luzon Power Grid.
“On my second day in office I was already at the office of Department of Energy (DoE) Secretary Carlos Jericho Petilla asking for more time and the restructuring of our debt,” said Paulino.
“Normally they give out disconnection notice but when there is already a specific day and time for the disconnection that’s when you know it will really be disconnected,” he added.
The mayor said he pleaded with Petilla for a debt restructuring since the city was left with no money in the treasury.
Paulino said during the meeting, PSALM President and CEO Emmanuel Ledesma Jr. agreed to restructure the city’s debt upon the prodding of Petilla.
“We arrived at a monthly payment scheme of P10 million which will be deducted from the city’s Internal Revenue Allotment (IRA) of P33 million.” Paulino said.
However, an initial payment of P30 million was made and another P90 million will be paid in two months’ time, he added.
Paulino said in July, the Public Utility Department (PUD) was privatized and sold for P610 million to the Cagayan Electric Power and Light Company (CEPALCO) as part of the debt management scheme.
He said it was renamed Olongapo Electricity Distribution Co. Inc. (OEDC), which was given a 25-year franchise to supply power to the city.
Paulino said he was initially against the privatization of the PUD but the gargantuan debt has made it impossible for the city to sustain its operations.
“I will only be able to pay the debt in 29 years without interest,” he lamented.
The mayor said it is a puzzle “how and where” the P80-million monthly collection from electric consumers in the city from the previous administrations was spent without paying off its debt.
“They only paid Napocor P20 to P25 million per month which explains why (the debt) ballooned to P5 billion,” he said. “And the city government also bought transformers every month, which is rather strange.”
The mayor said he is now gathering evidence to sue the former mayor for plunder. He said the general manager of the PUD will also be investigated.
Meanwhile, Paulino said the city has a 10 percent share from Subic Water earning P18 million a year in dividends. But the previous administration sold the city’s share of 10 percent for P210 million which was allegedly spent in only two days by the past administration.
He said P50 million was spent for medical and dental project of the former mayor, P30 million for repair of buildings, P10 million for repair of other buildings, and P5 million repair of vehicles.
But Paulino said it is still a puzzle why there is an allocation for animal feeds for the zoo when “we don’t even have a zoo in the city.”
A landfill debt of P455 million and trash bins of P200 million were also some of the expenditures of the past administration, he said.
But Paulino laments how the previous administration was able to change the James L. Gordon Memorial Hospital into a foundation “because now everything is owned by the Gordons.”
The x-ray machine was taken from the hospital and transferred to the house of the former mayor as well as the other hospital equipment, he said. Patients now have to go to a private hospital for their medical needs, he said.
“A heavy burden is now on my shoulders because the people are expecting a lot from my leadership,” he said especially after winning by a large margin of 17,000 votes over his closest rival in the recent elections.
