ANGELES CITY— “Study first the city’s financial standing and desist from deceiving the electorate with empty promises.”
This was the statement made by mayoralty bet Alex Cauguiran as he urged Vice Mayor Bryan Nepomuceno to heed his advise for the sake of the city.
Cauguiran issued the statement following reports published in a local paper that Nepomuceno pledged to pour in P1 billion for the Ospital Ning Angeles (ONA) and another P1 billion for the City College of Angeles (CCA) if elected in May.
“Nepomuceno tells the people what he says he will do without saying how he will do it, one obvious desperate attempt to cover up his blunders. Instead of doing the math, he has these outlandish pledges,” Cauguiran charged.
The Kambilan mayoralty candidate was referring to a previous controversy involving the vice mayor’s approval of the use of the P1 billion loan from the Development Bank of the Philippines (DBP).
“As head of the city council which holds the power of the purse, he approved the use of the (P1 billion) loan from the DBP for the construction of non-essential projects. Then he failed to cause the publication of ordinances for the appropriation and approval of loan terms before bidding out multi-million infrastructure projects,” he charged.
Cauguiran and his party mates recently asked the Commission on Audit (COA) to look into the propriety of bidding the projects without the enabling ordinances.
Cauguiran said Nepomuceno “has exposed his utter lack of understanding of the financial resources of the city government by making such wild pledges.”
Raise taxes
“The only way that Nepomuceno could raise P666 million per year for three years is to increase local taxes, such as real property tax and business tax or local nontax revenues like regulatory and service fees or charges. His plan alone is red flag with the business sector,” Cauguiran said.
“Since these taxes are borne by city residents, what happens to Nepomuceno’s another pledge that he would not impose new taxes under his watch? Surely, he could not rely on the IRA to increase by P666 million per year since the remittance of such fund is based on the codal formula of the Local Government Code of 1991 over which he has no control,” he added.
Cauguiran, a former twotermer city councilor and city hall chief-of-staff , has consistently criticized the city government for borrowing P1 billion from the DBP for the construction of a new city hall amounting to P580 million, a sports complex which costs P360 million, and a multi-level parking for P60 million.
Rising debts
“The only way that Nepomuceno could raise P2 billion, to make good his pledges,” Cauguiran observed, “is to borrow again another P2 billion” from a financial institution, like the DBP which is its depository bank. “This will raise the city government’s debt to about P4 billion,” he added.
“We ask Angeleños in offices, on the street and in social media and all they say is: The city government could have opted to expand and improve the services of the ONA and the CCA, instead of these extravagant projects,” he said.
Cauguiran explained that based on the city hall’s 2019 budget, the city’s total revenue amounts to P2.08 billion consisting of Local Tax Revenue at P747 million; non-tax revenue at P323 million; IRA at P948 million; shares from government-run corporation at P323 million, plus other shares from the national government at P12 million.
“For the same year, the city’s expenditures amounted to P2.08 billion for capital outlay, salaries, operating expenses and others. This year, the city’s annual debt service amounts to a staggering P276 million, with the repayment of the P1.5 billion loan to stretch up to 15 years,” he explained.
“Then again,” Cauguiran said, “Nepomuceno cannot carve out P666 million from the personal services as salaries and personnel benefits cannot be reduced, or from the debt service as this is covered by loan term agreements, or from the 20 percent development fund and other automatic appropriations as provided by law.”
Crippling LGU
The mayoralty bet explained that raising the P666 million, as the vice mayor projects, by appropriating the whole Maintenance and Other Operating Expenses (MOOE) will cripple the city government machinery to a standstill while still being short by P365 million per year.
“To completely wipe out the other non-office expenditures would result in the abolition of such programs as scholarship, barangay outreach, environmental protection and sanitation, peace and order, and traffic management which are essential for general welfare,” Cauguiran added.
Records show that for the city’s outstanding loan of P2.3 billion, the city government’s debt service payment has already reached P276 million annually, beginning this year.
“The enormity of the amount just to service the debt has seriously affected the services at ONA which for 2019 has only a budget of P4 million for medicines, and P11 million for medical, dental, and laboratory supplies. Should Nepomuceno borrow another P2 billion, he will figuratively bring the city government down to its knees,” he said.
Cauguiran is the official mayoralty candidate of Kambilan, Pampanga’s biggest political party led by Gov. Lilia G. Pineda.
