VP Binay liable for 'bloated cost' of Makati City Hall Building 2

A special team of the Commission on Audit (COA) found Vice President Jejomar Binay liable for the "bloated cost" of the Makati City Hall Building 2, the main subject of a Senate inquiry into corruption allegations against the second highest official in the land.

According to the 148-page report, a copy of which was obtained by GMA News, the construction of the building, which was done in five phases, "showed irregularities from budgeting to procurement to execution resulting in misuse of public funds."

The state auditors said Binay, his son and Makati City successor Jejomar Erwin "Junjun" Binay Jr., whistleblower and former Makati vice mayor Ernesto Mercado and other officials of the city government should be held liable for violating the government procurement law (Republic Act 9184), Local Government Code (Republic Act 7160), State Audit Code (PD 1445) and the law penalizing contractors and subcontractors violating public works contracts (PD 1759).

Sanctions and penalties as provided by the laws mentioned may include a fine, imprisonment, perpetual disqualification from public office, and confiscation or forfeiture in favor of the Government any prohibited interest and unexplained wealth.

COA noted that the original project of the nine-storey parking building with a cost of P283 million was upgraded to 11-storey with a "bloated cost" of P2.28 billion without an approved building plan and approved budget cost.

"Thus, the absence of PPMPs (project procurement management plans) and APPs (annual procurement plan) which should have beforehand determined the extent/size of contract scopes/packages for the Makati City Hall Building 2 resulted in the construction and implementation of the project into five phases without judicious planning and procurement," the report said.

The agency also belied the claim that "competitive" public biddings were made with regard to the five phases of the project, which Hilmarc’s Construction Company constructed starting in 2007 during the term of the elder Binay as mayor of the city.

The project was continued by his son Junjun Binay, who succeeded his father as Makati mayor in 2010.

The report also said the contract for architectural and engineering services for the parking building with Mana Architecture and Interior Design, Co. (MANA) for P11.97 million was not covered with an appropriation and was awarded through "simulated bidding."

Payments were also not supported by documents and information required by law, COA said.

Directly responsible

When COA asked Binay about his role in the bidding and construction of the parking building, the vice president's lawyers said he only reviewed the completeness of the bid documents presented to him for approval as well as the recommendation of the Bids and Awards Committee.

To do otherwise, Binay's lawyers said, would invite suspicion that he is attempting to influence the BAC in its decision to award contracts to winning bidders.

Citing Section 2 of Presidential Decree 1445 or the State Audit Code, the auditors said fiscal responsibility rests directly with Binay in his capacity as then head of the Makati City government.

"The absence of an APP to which the head of the agency should be aware of, which is an indispensable requirement for judicious planning and requirement, should have alerted him (Binay) to do a more strict review and supervision of BAC's processes, findings and recommendations," the report said.

While auditors assigned to Makati who reviewed the project did not issue any adverse audit observation or notice of disallowance, COA said that does not mean that the transactions were legal and regular.

Five objectives

COA laid down five objectives of the special audit.

These are whether the procurement for the construction of the building is in accordance with laws, rules, and regulations; construction costs are reasonable; contracts for architectural and engineering services and construction of the building, respectively, are legal and complied with.

The audit team also wanted to find out if the project is properly implemented as planned and if the reported accomplishments as well as the corresponding payments are valid, authorized, accurate, and supported by complete documents.

Twelve auditors led by lawyer Chona Labrague took part in the special audit, which had its entrance conference on December 2, 2014 and exit conference on January 12, 2016.

During the course of investigation, COA admitted that some documents were not submitted due to suspension and eventual dismissal of the officials involved in the procurement and implementation of the project.

COA noted the dismissed officials were replaced by the incumbents "who have no personal knowledge of the documents" under the custody of their predecessors.

One of the dismissed officials is Junjun Binay, who is already facing graft and falsification of public documents cases before the Sandiganbayan in connection with the parking building anomaly.

Trading barbs

Binay and the Office of the Ombudsman earlier traded barbs regarding the release of the special audit report, which can be used as basis in pursuing graft cases against several people including the vice president.

Binay's camp accused Ombudsman Conchita Carpio Morales of pressuring COA into coming out with a report that allegedly does not contain the side of Makati City Hall officials involved.

The Ombudsman turned the tables on Binay, saying in a statement last Sunday that it was the vice president's camp which appealed to a COA official not to release the report before the May 9 election.

On Monday, however, Binay denied that he urged the the Commission on Audit to delay the release of its report on the alleged overpriced Makati building until after the 2016 elections.

Immune from suit

Earlier, Morales noted that any charges against the elder Binay would have to be filed in court after the end of his term, as the vice president is immune to suits while still in office.

“Because he is an impeachable officer and because of jurisprudence, even if he is alleged to have committed the offense or offenses when he was not yet impeachable, we have to defer the filing of the case until after he becomes a non-impeachable official,” Morales said.

If Binay wins the 2016 presidential election, Morales admitted that the filing of charges would have to wait six years.

“As president, of course he has immunity. But when he finishes his term, then we can file a case against him, if we find probable cause finally,” Morales said.

Binay is one of the leading candidates in the race to Malacañang. — JST/APG/KG, GMA News