Rama orders review of parking contract

CEBU, Philippines — Cebu City Mayor Mike Rama has ordered a review of the city’s joint venture agreement (JVA) with Tokagawa Global Corporation (TGC) on street parking operations, months after the Commission on Audit (COA) issued its recommendation for such action.

COA, in its latest audit report, said the unincorporated JVA with TGC is disadvantageous to the Cebu City government, aside from being in contrast to section 130-c of the Local Government Code. It is also not compliant with some parameters under City Ordinance 2154, the local code implementing national guidelines on joint venture agreements.

“For all intents and purposes, the JVA was not an agreement to undertake an investment activity but merely a concession of governmental function involving collection of charges to a private entity contrary to Section 130 (c) of the Local Government Code,” the state auditors stressed.

COA also noted that certain parameters set forth under City Ordinance No. No. 2154 dated September 17, 2008 were not complied with.

The state auditors also noted that despite the significantly reduced capital requirements of TGC, the high earning potential of the city’s assets, and the expanded operation coverage under the renewed JVA, allowing the TGC to get the same amount of 78 percent share from the revenues similar to the previous contract is plainly inequitable to the city’s 22 percent share.

The city government, accordingly, “did not exercise its right to inspect the TGC’s books/income, contrary to Paragraph F of the JVA in relation to Section 20(d), Article II of RA No. 3857 or the Revised City Charter of the City of Cebu.”

Mayor Rama, during his teleradyo program via the City’s Sugboanon channel this week, wants to review the services provided by TGC as the firm was still implementing pay parking services that were “prone to corruption.”

With this, Mayor Rama directed City administrator, Atty. Collin Rosell, to review the city’s JVA with TGC or find a new contractor that can help manage the city’s pay parking system.

“My directive to Atty. Collin Rosell is to venture into online means. Digitalization na gyud ta, Online na ta. Let us adopt a technology that reduces corruption,” said Rama, adding he wants a pay parking system which uses “smart” parking meters rather than using attendants to collect fees.

If the JVA with TGC is not terminated, COA also recommended for “contract revision or at least to conclude a supplemental JVA to incorporate all the required parameters set forth under Section 6, par. (3) of City Ordinance No. 2154 dated September 17, 2008 with amendatory provision pertaining to revenue sharing terms to make it more just and equitable for the parties owing to (a) the disparity.”

The City’s News and Information team noted that according to COA, the city, under the term of former mayor Tomas Osmeña, entered into a JVA with TGC in order to address the lack and shortage or absence of tangible and/or viable parking management services, and to help solve the problem of illegally-parked vehicles, which causes daily traffic congestion.

During the former mayor’s term, the city entered into the JVA with TGC, first in November 2018 for a term of three years and was renewed on Feb. 8, 2022, this time for a term of five years. The agreement is expected to expire in 2026.

Rama said, the city government does not have to wait until 2026 to rescind the JVA with TGC and he wants TGC’s contract to be reviewed as soon as possible, especially after he found out that the firm had put up too many pay parking slots around the city.

“Murag nahurot nalang ang dalan sigeg parking-parking, puros nalang pangwarta. Kinsa may nakaginansya? Alkanse man ang Cebu City ana,” Mayor Rama said.

The mayor also noted that major thoroughfares in the city have paid parking spaces that cause gridlocks, as well as in heritage areas which discourage tourism. - /ATO (FREEMAN)