Issue of November 12, 2017
Mt. Province

Panagbenga Flower Festival
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City ready to bid out 35 slots in market after lapse of contract
by PIO release

Mayor Mauricio G. Domogan called on the 35 market building lessors who were not able to renew their contracts with the city government to start removing their improvements to allow the bidding of the city-owned properties.

Domogan denied the allegations of the building owners who failed to renew their contracts that there was no due process in the inclusion of the 15-year lifespan in the final contract.

He said that all parties were present during numerous consultations that were called to finalize the provisions of the contract.

“We take exception to the allegations of the building owners that there was no due process in the renewal of their contracts that resulted in the inclusion of the provision that the lifespan of the agreement will be 15 years and that all improvements shall accrue to the local government,” Domogan said.

He said that the building owners should be grateful that local officials were able to convince the Commission on Audit that instead of subjecting the city-owned lots for public bidding considering that the local government was actually at a loss in the said contracts, the new rental rates were negotiated between the parties with the inclusion of the provision that the agreement will last for 15 years.

Domogan said it was agreed upon by the market building owners that the rental for the leased space will be P6 per day per square meter for the first five years and an increase of P2 per day per square meter for the 6th to 10th year and an additional P1 per day per square meter for the 11th to 15th year of the contract with the conformity of COA representatives.

He said it is clear that the contracts of the 127 market building owners already expired on Dec. 31, 2015 and that their renewal is upon mutual agreement of parties. Since there was none, it is only proper for the 35 businessowners to remove their improvements over the city-owned lots so that the same can be bid out to other lessors willing to adhere to the 15-year lifespan clause in the agreement.

Earlier, the COA discovered that the local government had been entering into contracts with the market building owners, which was described as disadvantageous to the city since the rentals collected from them are reportedly way below the prevailing rates in other structures within the vicinity of the city-owned properties.

Domogan said even with the final 15-year contract, the market building owners have occupied the city-owned lots for over six decades now, which means that they already recovered their investments and improvements on the properties.

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