THE Bacolod Real Estate Development Corp. (Bredco) accepted the proposal to pay P6 million in annual compensation to the City Government once the agreement for the extension of the Bredco port operation is finalized.
John Palanca Alonte, president of Bredco, agreed to the proposal presented by Councilor Caesar Distrito during the committee hearing held Monday at the City Council session hall regarding on the endorsement letter of Mayor Evelio Leonardia on Bredco’s decision to exercise the option to operate and manage the port at Reclamation Area for another 25 years after the expiration of the original 25-year period in 2020.
The exercise of the option by Bredco is embodied in the March 16, 1995 Comprehensive Revised Reclamation Agreement (CRRA) between the City of Bacolod and Bredco.
Bredco’s contract will expire in March 2020, and at present, it is paying P800,000 per year to the City Government.
Alonte said that when the contract was signed in 1995, it was a build-operate-transfer (BOT) scheme, but his uncle former, Bredco president Simplicio Palanca, decided to give compensation to the City Government.
“So we are exercising that and this year, upon the renewal we are open to negotiating with the City Government,” he said.
The City Government owns the 50,000 square meters lot at Bredco Port.
Distrito, chairperson of committee on laws, said the compensation offered by Bredco is P3.8 million.
“The city will receive P3.8 million based on their offer or with an increase of around 350 percent, but when the Technical Working Group made a proposal of P5.2 million, in our case in the City Council we are not bound to that, we offered if they can make it a P6 million, with an average of at least P500,000 per month in five hectares. Or there will be at least P100,000 per hectare per month of compensation that the city will be receive,” he said.
Distrito added that this is “just and fair” because the city would now be getting something like 800 percent from the P800,000 that the city is presently receiving, which is highly advantageous on the part of the city.
He noted that the City Government will also receive P8 million from Bredco as part of the past adjustment and every five years, the city will also receive a 25 percent increase.
Distrito said the P6-million compensation was also supported by majority of the members of the City Council.
Alonte said it is okay for them to pay the P6 million compensation and they are hopeful that they can have a memorandum of agreement with the City Government as soon as possible.
“It is difficult to invest if there is no security in the contract,” he said.
Alonte added that they are planning to build a world-class port facility and they need to invest in equipment or about P500-million for the improvement of the port.
He said they already invested a couple of billions for building the port, adding that on March, they will inaugurate the 7,000 square meters port terminal facility which costs P375 million.
If the proposed extension will be approved, Alonte said that this would be his birthday gift to his uncle Simplicio, who is now sick, next month.
His uncle really wants to renew the contract with the City Government, he added.
Distrito said he will make a committee report and will submit it to the City Council on Wednesday.
Councilor Claudio Puentevella said the P6 million has no basis and it was not determined if it is acceptable to the people of Bacolod.
“I am hoping that all the members of the City Council will be given time to discuss this issue thoroughly. We have to be fair because it is the property of Bacolod City and not by Bredco alone,” he said.
Distrito countered that the letter was sent to the City Government in October last year and there are experts reviewing it and inspecting it.
