Aug 162014

Could lady luck be turning her back to the powers-that-be at the Bases Conversion and Development Authority (BCDA)?

Just recently, the Department of Environment and Natural Resources (DENR) reportedly stood by the Baguio City government in not finalizing BCDA’s application for a special patent covering the 14 barangays within the Camp John Hay (CJH) reservation.

 DENR Cordillera OIC Paquito Moreno Jr. said the special patent being sought by BCDA could not be issued in view of Baguio City Resolution 362 (1994) which listed 19 conditions for the city government’s turnover of the erstwhile US military camp to BCDA.

 Condition No. 14 of that resolution excluded from the CJH reservation 14 barangays, namely, Green Water, Country Club, Upper Dagsian, Lower Dagsian, Sta. Escolastica, Hillside, Happy Hollow, Loakan Apugan, Atok Trail, Loakan Proper, Camp 7, Loakan Liwanang, Lucnab and portions of Outlook Drive.

SunStar Baguio reported that the DENR move has “strengthened the resolve” of the city government to appeal to the BCDA to comply with the 19 conditionalities, and has prompted Baguio City mayor Mauricio Domogan to order the city’s Legal Office to file a case for specific performance against the BCDA for breach of this resolution in applying for a special patent covering the 14 barangays.

BCDA suffered another setback when the Baguio City government reportedly opposed BCDA’s application for a permit with the National Water Resources Board (NWRB) to tap Barangay Greenwater as a source of spring water for CJH.

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The City Council said BCDA’s application violated one of the 19 conditionalities under Resolution 362 on the Master Development Plan for CJH, specifically the one mandating BCDA to source water from outside Baguio to prevent the depletion of local water sources for all city residents.

That’s two strikes for BCDA under Casanova’s watch.

“Strike Three” could come in the form of a possible adverse ruling by the Philippine Dispute Center Resolution Inc. (PDRCI) in the arbitration case that BCDA’s private partner, Camp John Hay Development Corp. (CJHDevco), filed against the agency for the latter’s alleged violation of their lease development contract.

BCDA’s alleged violations include delay in the release of the environmental clearance certificate (ECC) until two years into the project; delay in the turnover of 32 hectares of the leased area; failure to deliver 79% of the 18-hectare developable footprint of the leased property; failure to immediately demolish pre-1996 existing structures within the leased property at JHSEZ; the Supreme Court’s withdrawal of the tax and duty incentives within the leased JHSEZ area as warranted by BCDA; and non-creation of the mandated One Stop Action Center (OSAC) to process and issue all permits needed by CJHDevco and its locators.

Casanova claims that CJHDevco has refused to pay lease rentals totalling P3.3 billion.

CJHDevco on the other hand asserts that it has already paid over P1.4 billion in rentals and invested P5 billion at the John Hay Special Economic Zone (JHSEZ) from the time it started leasing the property 18 years ago.

In his open letter, Casanova said that BCDA has remitted P256 million to the city government as Baguio’s share from rental payments for the lease of the CJH ecozone, contrary to claims that the private developer has been remiss in paying rent.

Meanwhile, mayor Domogan and House Rep. Nicasio Aliping Jr. noted in their joint statement the “blatant disregard and disrespect” by BCDA and JHMC of provisions of Resolution 362 dated 1994 covering the 19 conditions for the development of Camp John Hay.

This include non-compliance with the provision requiring BCDA to coordinate with the Baguio Water District (BWD) for the sourcing of additional water supply “from outside the city” for use in the JHSEZ’s overall operations and by its concessionaires and clientele; failure to exclude all affected barangays from the John Hay reservation; non-remittance to the city government of its full 25 percent share from the rental collections from the leased JHSEZ premises (they say BCDA has not remitted a single centavo of the city’s 25 percent share from Ayala Corp. operating the Ayala Techno Hub and that BCDA amended its lease contract with Ayala and extended the lease term for 75 years without notifying the city government in clear violation of the agreement); among others.

Clark GGLC project continues

The $3-billion Sabah Al-Ahmad Global Gateway Logistics City project at the Clark Freeport Zone is reorganizing its development team to accelerate its completion.

Project proponent Global Gateway Development Corporation (GGDC) said it needs to adjust internal structures to step-up completion, even as it reiterated its committment to pursue the development of the $3-billion logistics city.

 GGDC was originally founded by The Port Fund, a private equity fund managed by KGL Investment Company (KGLI), whose main managed investments in the Philippines have been the Clark project and a stake in the 2GO Group and Negros Navigation.

Sabah Al-Ahmad GGLC, named after the Amir of Kuwait, is a 177-hectare mixed-used project near the Clark International Airport, envisioned to be a state-of-the-art commercial and logistics aerotropolis built to the highest environmental standards. Once completed, the project will have a total of 5.8 million square meters of floor space.

GGDC said it is committed to accelerating work on the Clark project. It has invested over $100 million in the project, with another $150 million to be invested by the end of 2015.

GGDC’s investments to date include over 30 hectares of fully developed lots and the pre-leasing of a world-class 20,000 sqm hospital to The Medical City.

GGDC said it also expects to finish by the end of 2015 five office towers with gross floor area of 145,000 square meters, a retail and gas plaza, and a hotel and serviced apartment complex. These complexes will create employment opportunities for over 15,000 Filipinos from the region.

The whole GGLC project will entail investments of over $3 billion. Once completed, the project expects to generate employment for over 300,000 workers with $600 million in annual pay for entry-level employees alone.

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