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No more JV for Marawi rehab: No profit or loss sharing in this venture – HUDCC

The government is abandoning the joint venture scheme for the rehabilitation and reconstruction of Marawi and will instead go for multiple procurement system to fully comply with the Republic Act (RA) 9184 or the Government Procurement Reform Act.

This was according to Marcelino Escalada Jr., secretary general of the Housing and Urban Development Coordinating Council (HUDCC) and general manager of the National Housing Authority (NHA) on Sunday.

“No more joint venture because that is not the appropriate modality
and it is also not legal to enter into a joint venture,” Escalada said
in a press briefing with local reporters.

Escalada said the decision was approved by the Council in its meeting last Friday as a complete turnaround of the previous approaches to the rehabilitation, recovery, and reconstruction of Marawi that costs P14 billion spread within the next three years (2019 – 2021).

Escalada said joint venture is a single procurement method that is not only appropriate but would also take time.

“This was supported by the DOF (Department of Finance), the ADB (Asian Development Bank, and the Public-Private Partnership Center,” he said, pointing to legal questions involved in joint venture schemes for government transactions.

“Wala naman sharing of profit and sharing of loss. Who would share profit or loss if we developed Marawi? There is no business to talk about here,” he said.

Under the multiple procurements, Escalada said government agencies will be engaged or involved in the implementation of various projects.

New direction

Following the decision, Escalada said the proposed new strategy and action plan for the rehabilitation of the Most Affected Area (MAA) would now engage the whole Task Force Bangon Marawi (TFBM) and sub-committees in the various components of the Master Development Plan (MDP).

He said the head of each sub-committee shall package their corresponding rehabilitation component and submit the funding requirement to the chairman of the TFBM through its project management offices for consolidation.

“The technical secretariat and PMO will then prepare the Project Implementation Plan (PIP) for each component and present to TFBM for approval. Once the PIP and its corresponding budget are approved, each component shall be a farm out or downloaded to the respective sub-committee or department for procurement and implementation pursuant to the approved PIP,” he added.

Funding support

Escalada said the Marawi development will be funded in three tranches: P4.5 billion for the first year; P6.5 billion for the second year and P3 billion for the third year.

The money will be sourced from available funds from all implementing agencies, he said.

Escalada said the project has 21 components.

The components under the first year include Debris Management (P2.3 billion); Master Development Plan with Feasibility Study (P20 million); Sewerage Treatment Plant (P650 million); Port Facilities (P119.85 million); Wharves Recovery (P567.36 million); Land
Acquisition (P400 million); and Grand Padian Central Market (P443.25 million).

The building of a sanitary landfill also falls under the first priority, but no amount of funds is indicated yet.

The second year includes road infrastructure with underground
facilities at P4.768 billion. The road infrastructure includes a storm drainage system, sewer system, water supply, and telecommunication. Also, under the second priority component are the Agus River and Lake= Lanao Promenade (P500 million); Maritime Headquarters (P49.25 million); Halal Slaughterhouse (P47.16 million); Multi-Level Carpark (P208 million); Hospital with Basic Equipment (P813 million); and Protective Facilities (P133.1 million).

The third year includes the Barangay Complex with Health Center and Madrasah(P407 million); School building (P1.144 billion); Convention Center (P392.98 million); Peace Memorial Park (P453.1 million); Preservation of Historical Sites (P100 million); Multi-Modal Transport Hub (P48.75 million); and School of Living Tradition (P48.69 million).

Escalada said the implementing agencies will start their respective
program of works by January next year. (Lilian C Mellejor/PNA)

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