COA questions validity of NHA's P1.12-B compromise with R-II Builders

The Commission on Audit (COA) questioned the validity of the National Housing Authority (NHA)’s P1.12 billion compromise agreement with private contractor R-II Builders, Inc. in connection with the Smokey Mountain Development and Reclamation Project (SMRDP).

In an Audit Observation Memorandum addressed to NHA General Manager Marcelino Escalada Jr., the state auditors noted the discrepancies between a court-approved P1.12-billion NHA-RBI compromise deal and a 2019 NHA briefing paper submitted to Senator Juan Miguel Zubiri where NHA apparently admitted that it already overpaid RBI by P301.7 million.

The said P1.12 billion deal, which was approved by the Court of Appeals on May 30, 2019, allows the NHA to pay the RBI the initial amount of P500 million in cash within six months from execution of the Compromise Agreement provided that the parties may further agree to the payment of the same thru dacion en pago (special mode of payment agreed by parties) of properties located at Vitas, Tondo, Manila.

Likewise, the same deal states that the remaining balance of P622.4 million will be paid by NHA to RBI in cash and by way of dacion en pago of the following real properties and the respective fair market values to be determined by a duly accredited appraiser chosen by NHA in accordance with existing laws.

“While records disclose that NHA has not paid to RBI the court-approved amount under the Compromise Agreement, the [NHA] Management, as of to date, has not submitted to the Auditor the riposte or a copy of the comments, if any, of the [Office of the Government Corporate Counsel or OGCC] to the AOM as well as the requested documents,” the COA said.

“As a consequence, evaluation of the validity of the transactions could not be had,” state auditors added.

Having said that, COA said that the NHA should submit a reply to the queries and documents requested in Audit Query Memorandum No. 2019-008 dated October 7, 2019 for a thorough evaluation of the validity of the transactions.

“May we have your comments on the foregoing audit observations within 15 calendar days from receipt hereof,” COA said.

“However, if documents/information/data needed for your comment(s) are not available to you at home, kindly inform us and submit your comments within five working days upon the lifting of the Enhanced Community Quarantine and once we are authorized to report back to our respective offices,” COA added. — DVM, GMA News