Acting Bacolod City Treasurer Annabelle Badajos said the giving of the P4 million financial assistance by the city to the Silver MassKara Festival Organization Inc. was not a violation and that there was no illegal disbursement of funds.

The COA audit observation memorandum dated Feb. 25, 2008 said the 2007 annual budget did not provide for the P4 million financial assistance given by the city to the SMFOI.

It said the appropriation of P4 million financial assistance to the organization, which was authorized by the SP through Appropriation 16 series of 2007, was without legal basis.

Badajos, however, said the city cannot disburse funds without any legal appropriation. She said she has issued a certification that there was a P14 million savings from the Personnel Benefit Fund in the 2007 annual budget.    

Vice Mayor Jude Thaddeus Sayson had earlier said that they based the appropriation ordinance on the certification of the City Treasurer and Budget Officer.

The city entered into a memorandum of agreement with the SMFOI for the latter to be given financial assistance of P4 million to perform functions necessary and related to the MassKara Festival 2007 and the 69th Charter Day celebrations.

The fund was sourced from the appropriated amount of personnel benefit fund as certified by the City Treasurer and City Budget Officer on Sept. 11, 2007.

The COA memorandum said the funding source of Appropriation Ordinance 16 was certified by the City Treasurer as available under the personnel benefit fund class of expense while the financial assistance is under the Maintenance and Operating Expenses.

The COA also said that Section 322 and Section 336 both of R.A. 7160, clearly provides that appropriated funds shall be available  exclusively for the specific purpose  for which they have been appropriated and prohibits the passing of  an ordinance authorizing  the transfer of appropriation from one item to the other.   

Badajos said she submitted her explanation to COA Tuesday. The COA cannot be blamed since it was not aware of the real facts, she said.

She said there was a reversion made by the Sangguniang Panlungsod from the personnel benefit fund in the 2007 annual budget to the SMFOI and this was submitted to the Department of Budget and Management in Iloilo in the supplemental budget.

The supplemental budget was approved by the DBM without any comment, she said.

Badajos said the amount appropriated by the SP was intended for the increase of the salaries of officials and employees for January to December 2007. However, the DBM issued Circular 86 dated June 2007 allowing a salary increase starting July to December, she said. This means that the city has savings from January to June 2007, she added.

The savings generated from PBF was P14 million, Badajos said. Out of it the city appropriated P5 million for the SMFOI, and what was approved by the SP was only P4 million, she said.*CGS

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