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PCIJ: Cabangan in Zambales: Unchanged by elections

April 13, 2007 7:45pm

Tags: Zambales
CABANGAN, ZAMBALES — The Rural Bank of Cabangan sits proudly outside the center of this dusty town, where it is housed in one of the handful of commercial buildings in the area. Established in 1973 with a start-up capital of just half a million pesos, the bank now has an authorized capitalization of P9.5 million, with more than P70 million in resources.

It is the only bank in Cabangan, and practically one of the few things that have shown improvement (at least in terms of profits) here in the last two decades. It is also the bank the town mayor sometimes runs to whenever Cabangan needs loans for its purchases and operational requirements.

The bank's biggest shareholder is accounting graduate Jesse A. Mendigorin, who, along with his wife Jovelita and several other investors, had founded it. He was its first manager. Today Mendogorin is the mayor of Cabangan, a post he has held since 1988.

Well, he did have to step aside in 1998, when he reached his term limit. But control of the town hall didn't leave the Mendigorin household. His wife succeeded him for a term, after which the torch was passed back to Jesse in 2001, and he has held tightly onto it since.

While the accountant-mayor has succeeded in making the Rural Bank of Cabangan stable, a look at his town's budget shows dismal aptitude in bean-counting and priority-setting. In 2004, actual income from the town's market was just P675,295 and the projected income in 2005 was lower, at P555,000.

But the market has 30 casual workers eating up over P1 million in salaries. And while tax collection by the treasurer's office comes up to only an average of P1.2 million a year, that seven-man office gobbles up P1.6 million in salaries and maintenance expense.

The 2006 budget is also silent on any form of pump-priming activities, but there is a capital outlay of P405,000 for furniture and books.

Just 186 kilometers north of Manila, Cabangan, like many towns in rural Philippines, is a place that time forgot. It also offers a portrait of local governance gone awry - and that may be putting it kindly.

A fourth-class municipality, it lives chiefly on its share of Internal Revenue Allotment (IRA). To be blunt, the town will sink without its IRA. Its balance sheet shows that taxes collected from residents and businesses were at an average of P3.15 million in 2004 and 2005.

But the town spends P15 million on its employees' salaries and wages alone.

Of its P36.2 million budget in 2006, 71 percent or P26 million was from its IRA. The rest come from taxes, services, and rentals. And apparently, local officials expect little to change, as the town's budget projection is pegged at P36.2 million until 2008.

Residents themselves seem resigned to see the same sights in their town year in, year out. And decade in, decade out. "Walang nabago rito (Nothing changed here)," says a woman tending a sari-sari store in one of Cabangan's coastal barangays.

"Kung ano noon, ganoon pa rin ngayon. May videoke lang na nadagdag, pero maraming mag-asawa ang nag-aaway dahil nga may mga babae roon (What the town was before, it still is now. There's the new videoke bar, but couples fight because of the women who work there)."

Cabangan does have a bowling alley, too, but these days it is used chiefly by municipal employees for their yearly tournament. The bowling alley was supposed to generate income for the town, which built it through a P390,000-loan from the Rural Bank of Cabangan.

But less than a year after it was leased out, the bowling alley was shut down due to lack of business. Planning Officer Crispin Dunauto admits there was no feasibility study for the project before it was funded and carried out.

Budget Officer Felyn Paco says that in 1999, the town hall borrowed P1.6 million from the Rural Bank of Cabangan to buy tractors and rotivators to be rented out to farmers.

That loan carried with it a 24-percent interest. Borrowing from government financial institutions (GFIs) like the Land Bank of the Philippines or the Development Bank of the Philippines (DBP) would have meant only a 10-percent interest, or less.

In 2003, the Commission on Audit (COA) also castigated Cabangan's officials for setting up a mechanism wherein town hall employees borrowed money from the Rural Bank of Cabangan, again at 24-percent interest.

The monthly payment was withheld from the employees' payroll and remitted to the bank totaling over P580,000 in the first quarter of 2003 alone. COA said the deduction is not an allowed practice in government.

"With such practice, government personnel and its material resources were utilized for a private purpose in favor of a private entity," COA said. It added that the move resulted to the overstatement of expenses in the town's financial statements, and ordered town officials to "stop accommodating salary deductions for the payment of personal loans of employees in favor of private banks."

Documents submitted by the town to COA, however, show that collections for these loans continued up to 2005.

When asked why he chose to borrow from the bank he himself set up, Mendigorin argues that the loans were "maliliit lang naman (of small amounts)."

Mendigorin's own stake at the bank, meanwhile, has been getting bigger. In 1998, documents from the Securities and Exchange Commission (SEC) showed that Mendigorin owned 9,414 shares or almost 27 percent of the bank.

The following year, Mendigorin's shares rose to 14,212, or 31 percent.

The 60-year-old mayor's personal fortunes have also been rising. In his Statements of Assets and Liabilities, Mendigorin declared his bank holdings as worth P263,000 in 1975, P1.5 million in 2002, and P2.06 million in 2005.

This and other investments also boosted Mendigorin's net worth. He now has a declared net worth upwards of P7 million, a modest sum since it is based on the acquisition cost, and not on the current market value, of 22 agricultural and residential lands.


"SANA KINASUHAN ko na lang siya (I should have just sued him)," says Benedict Balderrama of the Sentro para sa Ikauunlad ng Katutubong Agham at Teknolohiya or SIKAT, referring to Mendigorin, with whom he and his group butted heads years ago.

In 1992, after the Mt. Pinatubo eruption, SIKAT set up shop in San Isidro, one of Cabangan's eight coastal villages. In the beginning, the group provided micro-lending facilities to fishermen, then embarked on the more ambitious project of establishing a fish sanctuary to boost the town's fish resources. Local fishermen patrolled the seas to curb dynamite fishing.

While Mendigorin was supportive at first, Balderrama says the mayor balked at jailing those caught dynamite fishing, many of whom were related to or supportive of the mayor. He says at one point, lawmen raided SIKAT's seaside office and carted off some radio equipment the organization used while patrolling the sanctuary. These were later returned, but many had already been rendered unusable.

"He said we taught the people to complain," says Balderrama. He repeats that he regrets not having filed cases against Mendigorin for freeing suspected blast fishers and for the raid in their office. SIKAT left Cabangan in 2000.

While there are grumblings against Mendigorin's reign, these never developed into serious threats against his continued rule. Residents here complain that local political groups have never succeeded in forging a unity ticket and fielding just one candidate against Mendigorin, fragmenting the votes of those who want to see a change in leadership.

"Siya (Mendigorin) rin lang naman ang mananalo, kaya siya na lang ang ibinoto ko (He was going to win, anyway, so I voted for him," says one townfolk.

In some ways, then, the people of Cabangan may have no one to blame for their town's seeming non-progress but themselves. Ramon Casiple, executive director of the Institute for Political and Electoral Reform (IPER), explains some towns are hit by stupor when leaders with no vision and impetus for change are elected and are kept in office for too long. He notes, "Leadership is a factor. Unless a mayor ventures out to learn from other towns, he will have no insights and ideas."

In truth, it's not as if Cabangan is in the middle of nowhere; it just feels that way. Cabangan is actually less than 50 kilometers away from the busy and work-rich town of Subic and Olongapo City. Yet while most of the country's towns are rushing to join and compete in the computer arena, Cabangan is one place that has no landline system.

The Philippine Long Distance Telephone Company stopped in San Felipe, Cabangan's neighbor down south, and Digitel began in Botolan, its neighbor up north. Many take a bus to the nearby town of San Felipe to go online. Mendigorin says lightning fried the satellite phone system they tried to set up in 2003.

The agriculture-dependent town is also hobbled by an unemployment rate of over 30 percent. Cabangan's biggest employer is the town hall itself, with more than 120 people as permanent and temporary workers.

Planning officer Danauto admits an average of only three new businesses set up shop in Cabangan every year, and these are usually sari-sari stores.

The town has three poultry farms, two of them owned by local politicians: the Gonzales poultry farm, which is the property of former Zambales Rep. Pacita Gonzales, wife of Justice Secretary Raul Gonzales, and the mayor's farm. The third is owned by the Cabasal family.

More than 60 percent of the town's over 21,000 residents rely on farming for their livelihood. The rest get their income from fishing and other trades. But the agricultural lands, almost 90 percent of which are planted to rice, offer very little hope of pulling residents out of poverty. Sixty percent of the town's rice fields are not irrigated.

No new ones are being constructed, and the existing systems are in near disrepair. Not surprisingly, many Cabangan residents have opted to seek employment abroad.

CASIPLE SAYS some politicians instinctively seek to protect and ensure the welfare of their family and clan first, and either neglect or ignore that of their constituents'. And with the timidity of many to question or complain about their elected officials, inept politicians remain in power. "The old landlord-tenant relationship, the feudal system, they're still in our culture," he says.

He adds that a town's disgruntled middle class, by leaving, wittingly or unwittingly helps a bad leader stay in power. "When the progressives leave, when the respected people in town do not put up a fight, local officials lose their sense of responsibility to do well," Casiple says.

Mayor Mendigorin, though, believes he has accomplished a lot the past 19 years, pointing at the edifices constructed under his term as proof. "My biggest accomplishment, I guess, is the establishment up of a national high school here," he says.

The mayor also asserts, "Before, Cabangan did not have a plaza. There was no market. Now we have those. And there's also an infirmary that's open 24 hours."

The plaza and public market were built with funds that the national government poured in after Mt. Pinatubo's eruption in 1991. But this writer, who grew up in Cabangan and went to high school there, remembers very well that long before Mendigorin came to power, there was already a cemented plaza in front of the town hall where various events were held. There was also a small public market. Both plaza and market were in the poblacion, however; now they are a short walk away from the center of the town.

In any case, the mayor says his administration is also trying to give the town youth some training to make them better prepared for the future. They may not offer any computer-training course, but Mendigorin says they have "trainings in welding, in cosmetology. Whatever (the youths') interests are, that's what we base our offerings on."

He also says young students and out-of-school youths are being tapped for the town's reforestation efforts, although he admits that these jobs are available only during the summer. He says those who are interested in computer-related training courses will have to approach the government's Technical Education and Skills Development Authority (TESDA) in the provincial capital, Iba, which is two towns away.

Mendigorin is running for reelection this May. He will have two challengers, but he doesn't look worried. He says he plans to borrow P1 million to finance the repair of Cabangan's irrigation system. But he says that this time, the town will borrow from the DBP. - Philippine Center for Investigative Journalism
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Tags: Zambales