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Tribunal sides with CoA on sale of Iligan power plants

THE Supreme Court (SC) has denied a petition that alleged the Commission on Audit (CoA) abused its discretion when it approved the request of a former Iligan City mayor to sell diesel power plants to Conal Holdings Corp. (CHC) for about P386.91 million in 2010.

In a 30-page resolution dated Aug. 16 and made public on Oct. 14, the SC full court said Iligan Rep. Celso G. Regencia, who filed the plea, failed to prove the agency’s abuse of discretion.

“Other than bare allegations, though, petitioners did not submit any evidence to substantiate their claim,” the tribunal said about the purchase price of the power plants.

Mr. Regencia and other private petitioners argued that former Iligan City Mayor Lawrence Ll. Cruz had given unwarranted benefits to the private holdings firm. The former mayor arranged the negotiated sale of Iligan Diesel Power Plant 1 and 2 to the firm.

The two power plants were constructed in the 1990s and were operated by National Power Corp. (Napocor), Power Sector Assets and Liabilities Management Corp. (PSALM), and Alsons International, Inc., an affiliate of CHC.

In 2007, the city government of Iligan bought the power plants since no public bidders participated in a scheduled auction. The auction stemmed from warrants of levy issued by the government on the real properties of the power plants against Napocor.

The city treasurer of Iligan sought to collect a total of over P350,000 of real property tax from the state-run NPC.

The following year, the city government proceeded to negotiate the sale of the properties with CHC, which offered P300 million to purchase the diesel plants.

In 2010, Napocor and PSALM relinquished their claims and rights over the power plants to Iligan City. The local legislative body of Iligan City then consented to the negotiated sale of the power plants to CHC pending the CoA’s approval.

In 2012, state auditors upheld the city government’s sale of the properties.

“There being no clear showing of arbitrariness or grave abuse of discretion by the CoA in this case, the court has no reason to set aside the assailed CoA decisions,” said the High Court. — John Victor D. Ordoñez

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