Can of worms
Can of worms
Updated 02:24am (Mla time) Oct 14, 2004
By Juan Mercado
Inquirer News Service
Editor's Note: Published on page A12 of the October 14, 2004 issue of the Philippine Daily Inquirer
WHOEVER President Gloria Macapagal-Arroyo picks to oversee the country's second largest international airport, which handles 2.27 million passengers a year, will find a can of management worms waiting.
If Tourism Secretary Ace Durano is right, the President is set to name retired Air Force general Adelberto Yap manager of the Mactan-Cebu International Airport Authority (MCIAA).
The Cebu airport is a major transport hub for the whole country. The MCIAA serves 12 domestic and foreign airlines that fly direct to Singapore, Malaysia, Korea, Japan and Hong Kong.
The new man will find the Authority saddled with P1.41 billion worth of untallied property and P2.45 million of its anti-hijacking trust fund garnished. Aircraft rescue equipment worth P30.8 million is rusting away. And Lapu-Lapu City seeks to seize P1.08 billion of MCIAA property to offset overdue land taxes.
The MCIAA's books "do not present fairly the [airport's] financial position," the Commission on Audit's (CoA’s) Maria Cristina Dimagiba told airport directors, including the mint-new Cebu Governor Gwendolyn Garcia. Some P137.5 million in receivables could bounce.
"Buildings and structures, amounting to P1.41 billion, were not recorded," the CoA officer-in-charge noted. Thus, the P2.04 billion listed under "Property, Plant And Equipment," in its books, is "materially understated."
Philippine Airlines (PAL) and Waterfront Hotel are two of the biggest debtors. Yet, they're spared paying the automatic two percent monthly penalty for delayed payments, the CoA notes. "Without need of formal advice," other concessionaries are dunned. That's what MCIAA Administrative Order 1990 mandates.
This leak drained P3.53 million from airport funds last year. Yet, the board never asked: Who excised that provision from PAL and Waterfront contracts? "Revisit the contracts to see if they were properly authorized," the CoA suggested.
While at it, the MCIAA should resolve a festering 11-year-old question: Does PAL now owe another P18.2 million in value-added taxes (VAT)? These are for use of the MCIAA's passenger boarding bridges, check-in counter, lots, etc. But in October 1993 -- seven years after the dictatorship collapsed -- PAL claimed Presidential Decree 1590 exempted it from VAT.
The board never asked for the exemption papers from the Bureau of Internal Revenue (BIR). Show it now, the CoA urges. Or has the BIR commissioner resolved this decade-old issue once and for all?
Will board have the guts to do that? Its compliance with previous CoA recommendations was lukewarm and partial. Nor has it collected P90.2 million in overdue IOUs. Trade and business offices racked up P88 million of those debts, overdue for four to 60 months.
House of Representatives Deputy Speaker Raul del Mar shepherded the airport charter into the law books. He envisioned an Authority ran professionally by career staff, hewing to civil service rules.
Politicians instead shoved proxies into position. President Fidel Ramos prodded a subservient board into buying a $7.86-million 412EP helicopter. It overrode then-finance officer Josefina Villasin's protest that the bill would bankrupt the Authority.
The chopper was for "rescue missions"-this was the excuse. But it never flew a mercy mission, CoA auditor Roberto Panesa wrote. It ferried presidential parties instead. And crew hotel bills were passed on to the MCIAA. Malacañang finally took over, but not before Authority tills were bled white.
If appointed, Yap takes over, while former manager Angelo Verdan battles before the Court of Appeals a ruling of Civil Service Commission Chairperson Karina David: He lacked qualifications. But qualified MCIAA career executives, who applied, were ignored. Is Yap facing turbulence over his civil service credentials?
In this devil-take-the-hindmost climate, services deteriorated. Airlines complained Runway 04 was so rutted that it threatened life and aircraft.
Lapu-Lapu City claimed 24 lots and three buildings to make up for unpaid land taxes. The MCIAA bucked that in court, claiming national government is tax exempt. Where law falters, innovative negotiations can succeed. But there's little of that.
It racked up, meanwhile, P15.9 million in "irregular" expenses: from a P584,000 increase in honoraria for board members to P7.4 million in rice allowances as political chips. The CoA disallowed both.
The MCIAA employs 150 cops. But it ladled out P6.96 million last year to Centurion Security Agency to post additional "blue guards." The MCIAA now has a security force equal to Amsterdam's Schiphol International Airport, critics claim. The ninth-busiest airport in the world, Schiphol serves 30.3 million passengers.
Every international passenger departing Mactan pays a P550 terminal tax. Of that, P60 is clipped for the Trust Fund for the National Commission on Anti-Hijacking and Terrorism. Nonetheless, a Cebu judge ordered that P2.45 million of it be garnished. It's to pay the Mactan Employees Mutual Association's legal counsel who argued for cost-of-living allowances.
"Inappropriate," snapped the CoA. In 2000, the Supreme Court reiterated the rule that government properties or public funds are not subject to garnishment. The case is now with the Court of Appeals.
While a fighter squadron commander, Yap caught national attention by openly defying the Ferdinand Marcos dictatorship. That may be child's play compared to beating down thieves who masquerade as the MCIAA's friends.
* * *
(E-mail: juan_mercado@pacific.net.ph)
Updated 02:24am (Mla time) Oct 14, 2004
By Juan Mercado
Inquirer News Service
Editor's Note: Published on page A12 of the October 14, 2004 issue of the Philippine Daily Inquirer
WHOEVER President Gloria Macapagal-Arroyo picks to oversee the country's second largest international airport, which handles 2.27 million passengers a year, will find a can of management worms waiting.
If Tourism Secretary Ace Durano is right, the President is set to name retired Air Force general Adelberto Yap manager of the Mactan-Cebu International Airport Authority (MCIAA).
The Cebu airport is a major transport hub for the whole country. The MCIAA serves 12 domestic and foreign airlines that fly direct to Singapore, Malaysia, Korea, Japan and Hong Kong.
The new man will find the Authority saddled with P1.41 billion worth of untallied property and P2.45 million of its anti-hijacking trust fund garnished. Aircraft rescue equipment worth P30.8 million is rusting away. And Lapu-Lapu City seeks to seize P1.08 billion of MCIAA property to offset overdue land taxes.
The MCIAA's books "do not present fairly the [airport's] financial position," the Commission on Audit's (CoA’s) Maria Cristina Dimagiba told airport directors, including the mint-new Cebu Governor Gwendolyn Garcia. Some P137.5 million in receivables could bounce.
"Buildings and structures, amounting to P1.41 billion, were not recorded," the CoA officer-in-charge noted. Thus, the P2.04 billion listed under "Property, Plant And Equipment," in its books, is "materially understated."
Philippine Airlines (PAL) and Waterfront Hotel are two of the biggest debtors. Yet, they're spared paying the automatic two percent monthly penalty for delayed payments, the CoA notes. "Without need of formal advice," other concessionaries are dunned. That's what MCIAA Administrative Order 1990 mandates.
This leak drained P3.53 million from airport funds last year. Yet, the board never asked: Who excised that provision from PAL and Waterfront contracts? "Revisit the contracts to see if they were properly authorized," the CoA suggested.
While at it, the MCIAA should resolve a festering 11-year-old question: Does PAL now owe another P18.2 million in value-added taxes (VAT)? These are for use of the MCIAA's passenger boarding bridges, check-in counter, lots, etc. But in October 1993 -- seven years after the dictatorship collapsed -- PAL claimed Presidential Decree 1590 exempted it from VAT.
The board never asked for the exemption papers from the Bureau of Internal Revenue (BIR). Show it now, the CoA urges. Or has the BIR commissioner resolved this decade-old issue once and for all?
Will board have the guts to do that? Its compliance with previous CoA recommendations was lukewarm and partial. Nor has it collected P90.2 million in overdue IOUs. Trade and business offices racked up P88 million of those debts, overdue for four to 60 months.
House of Representatives Deputy Speaker Raul del Mar shepherded the airport charter into the law books. He envisioned an Authority ran professionally by career staff, hewing to civil service rules.
Politicians instead shoved proxies into position. President Fidel Ramos prodded a subservient board into buying a $7.86-million 412EP helicopter. It overrode then-finance officer Josefina Villasin's protest that the bill would bankrupt the Authority.
The chopper was for "rescue missions"-this was the excuse. But it never flew a mercy mission, CoA auditor Roberto Panesa wrote. It ferried presidential parties instead. And crew hotel bills were passed on to the MCIAA. Malacañang finally took over, but not before Authority tills were bled white.
If appointed, Yap takes over, while former manager Angelo Verdan battles before the Court of Appeals a ruling of Civil Service Commission Chairperson Karina David: He lacked qualifications. But qualified MCIAA career executives, who applied, were ignored. Is Yap facing turbulence over his civil service credentials?
In this devil-take-the-hindmost climate, services deteriorated. Airlines complained Runway 04 was so rutted that it threatened life and aircraft.
Lapu-Lapu City claimed 24 lots and three buildings to make up for unpaid land taxes. The MCIAA bucked that in court, claiming national government is tax exempt. Where law falters, innovative negotiations can succeed. But there's little of that.
It racked up, meanwhile, P15.9 million in "irregular" expenses: from a P584,000 increase in honoraria for board members to P7.4 million in rice allowances as political chips. The CoA disallowed both.
The MCIAA employs 150 cops. But it ladled out P6.96 million last year to Centurion Security Agency to post additional "blue guards." The MCIAA now has a security force equal to Amsterdam's Schiphol International Airport, critics claim. The ninth-busiest airport in the world, Schiphol serves 30.3 million passengers.
Every international passenger departing Mactan pays a P550 terminal tax. Of that, P60 is clipped for the Trust Fund for the National Commission on Anti-Hijacking and Terrorism. Nonetheless, a Cebu judge ordered that P2.45 million of it be garnished. It's to pay the Mactan Employees Mutual Association's legal counsel who argued for cost-of-living allowances.
"Inappropriate," snapped the CoA. In 2000, the Supreme Court reiterated the rule that government properties or public funds are not subject to garnishment. The case is now with the Court of Appeals.
While a fighter squadron commander, Yap caught national attention by openly defying the Ferdinand Marcos dictatorship. That may be child's play compared to beating down thieves who masquerade as the MCIAA's friends.
* * *
(E-mail: juan_mercado@pacific.net.ph)
posted by Dante at 2:24 AM
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