The Dumaguete City government, through Mayor Felipe Antonio Remollo, sued the Dumaguete City Water District and its directors for what it calls “a highly anomalous and very irregular joint venture agreement” between the DCWD and MetroPac Water Investment Corp.
Remollo said the city government sued DCWD to prevent the parties from consummating and implementing the project.
A press release from the City Public Information Office quoted Remollo as saying, that “All proceedings already concluded by the defendants as well as any agreements already reached by them or other private sector participants be set aside and or declared without force and effect.”
The prayer for a temporary restraining order from the court was granted after Myles Nicholas Bejar, counsel for DCWD, and Cyrus Riconalla, a member of the DCWD Board of Directors, manifested that they will observe the status quo until such time that Branch 38 Presiding Judge Cenon Voltaire Repollo will be able to rule on whether to issue a preliminary injunction based on the merits of the case, with a hearing set on September 12.
If allowed to proceed, a joint venture company will be set up with MetroPac owning 80 percent while DCWD is left with just 20 percent share, a clear minority, the press release said.
Under the proposed joint venture, the new company will take over the operation, maintenance and expansion of the wastewater treatment plant, including the facilities, when it is clear that both the city government and DCWD are co-owners of the septage waste water treatment system and the facilities were built on the land owned by the city government.
The city government claimed that it is responsible for managing the operation and maintenance of the septage treatment plant. Hence, it said DCWD violated the property rights of the city government when it surreptitiously offered to include in the project, without consent of the latter, the operation, maintenance and expansion of the system.
The DCWD also created committees to accept unsolicited proposals, evaluation and awarding of the submitted proposals that can easily be rigged and are vulnerable to collusions since the Technical Working Group and Joint Venture Selection Committee are composed of members of the Board of Directors or top officials of DCWD, the city claimed in its press release.
The TWG is composed of Esperato Dicen, general manager of DCWD, as presiding officer of the TWG, with Rodrigo Lagahit Sr., chairman of the BOD of DCWD, division manager Rosemarie Rusell, Cyrus Riconalla, a member of the BOD of DCWD, department manager Sofronio Pinero, Roderick Diaz and Cleonico Fontelo, a BOD member of DCWD. The Joint Venture Selection Committee is chaired by Carlo Fontelo, son of Cleonico Fontelo, a member of the TWG and BOD of DCWD.
DCWD had earlier offered the city government to buyout one half equity in the system at P15 million but the offer is still pending due to the non-submission of documents by DCWD to justify the offered price.
These actions on the part of the DCWD allowing MetroPac to take over the control of the operation, maintenance and expansion of the wastewater treatment system without the consent of the City government “clearly indicate bad faith and intended to take advantage of the city government”, the press release added.*
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