Ombudsman orders indictment of Olongapo mayor, other execs for graft

The Office of the Ombudsman has ordered the indictment of Olongapo City Mayor Rolen Calixto Paulino and other local officials for graft over the alleged favors granted to SM Prime Holdings Inc. (SMPHI) for the development of the city complex.

In a 20-page resolution approved by Ombudsman Conchita Carpio Morales on June 25, the anti-graft body said Paulino and 15 of his co-respondents will be charged for violation of Section 3(e) of the Anti-Graft and Corrupt Practices Act.

Other respondents named in the case are Vice Mayor Aquilino Cortez Jr.; and then-Councilors Elena Dabu, Benjamin Gregorio Cajudo II, Eduardo Guerrero, Noel Atienza, Alruela Bundang-Ortiz, Edna Elane, Emerito Linus Bacay, Randy Sionzon, and Egmidio Gonzales Jr.

The Ombudsman also included city government officials Tony-Kar Balde III, Cristiflor Buduhan, Anna Marin, Florentino Sison, Mamerto Malabute, and Joy Fernandez Cahilig.

The indictment order was the result of the complaint lodged by Rodalyn Guinto Hanif.

On January 7, 2014, SMPHI submitted an unsolicited proposal to the city government for the long-term lease of the Olongapo City Civic Center, or the KBG Complex, where it will build a mall, hotel tower, call center buildings, parking slots, and a multimodal transport terminal.

The Special Bids and Awards Committee awarded the lease contract to SMPHI on December 16, 2014, while the city council passed the ordinance accepting the company's proposal on August 7, 2015.

SMPHI's lease has a term of 25 years and is renewable for another 25 years, while the rental rate was pegged at P30 per square meter per month. The proposal also entailed an initial investment of P3 billion.

Hanif claimed the KBG Complex and the expropriation if six privately-owned properties should not have been leased since the complex is protected under Proclamation Numbers 936, series of 1997, and 683, series of 2004.

The Ombudsman dismissed this accusation, saying all properties can be the subject of lease agreements under SMPHI’s proposal that was later placed for a Swiss Challenge, or an invitation for third parties to match or exceed the offer.

The Ombudsman, however, found fault against the respondents when they failed to follow the 60-day prescribed period from the publication of invitations to bid to awarding of the lease contract.

This period is provided under Republic Act No. 6957, or the law authorizing the financing, construction, operation and maintenance of government infrastructure projects.

Investigators found that SBAC recommended the issuance of a notice of award in favor of SMPHI on October 30, 2014, or only 10 days after the last invitation to submit bids was published.

SMPHI formally secured the lease contract on November 12, 2014.

“They acted with manifest partiality, evident bad faith or gross negligence by failing to follow the prescribed period under the law with the clear intent to deny other prospective project proponents of making a better offer or proposal, and as a result, their act gave unwarranted benefit advantage, preference or benefit to SMPHI,” the Ombudsman said.

The Ombudsman dismissed the charge of violation of Section 3(a) of the anti-graft law against the respondents. —NB, GMA News