Editorial

by ODON S. BANDIOLA

Aklan Needs P114.089 Millions 

For Loan Repayments In 2013

It is good that the people of Aklan is already updated on the total amount and the status of loans incurred by the provincial government through the years specifically during the Miraflores and Marquez administrations as provincial governors.

Thank the Office of the Provincial Treasurer and the Office of the Provincial Accountant for making public the figures on loans incurred during the budget briefings in the Sangguniang Panlalawigan (SP) of Aklan late last year. As it was the subject of budget deliberations, the SP is duly mandated to further make it public through our information dissemination and through the media outlets.

Incurring debts is not new and startling move in governance. Contracting loans for development projects and religiously servicing repayments are parts and parcel of sound fiscal management, sound governance. Incurring loans and repaying it on schedule is part of the system, a corporate reality, government having corporate function.

Marquez should not be faulted for incurring these loans. In fact, he should be praised for applying corporate fiscal administration in local governance.

In an attempt to clarify things about the subject, a mere news article may not suffice. Hence, this news commentary.

First, it cannot be a total P579.294 million outstanding loans starting in 2004. This figure was accumulated as of 2004. The loans were contracted starting that year, in 2007, 2008, 2010, 2011 and 2012.

The loans contracted after 2004 are the P40 millions bond floatation to finance the initial construction of the Caticlan Jetty Port and Terminal, and DOF’s Logofind of P81.895 millions used to upgrade the facilities of the Dr. Rafael S. Tumbokon Memorial Hospital (DRSTMH) into a tertiary hospital. These loans were contracted by former Governor Florencio T. Miraflores.

The P40 millions bond float is already fully paid by the administration of Gov. Carlito S. Marquez. That bond floatation landed in the pages of “success stories” book of the Department of Finance. The Caticlan Jetty Port and Terminal facing Boracay Island is now the highest earning economic unit of the provincial government of Aklan. It netted some P459.693 millions income for the last three years.

The unpaid balance as of this date of the P81.895 millions to upgrade the DRSTMH is P51.765 millions. The complete repayment of this loan is in 2019. The people can now judge how well the loan was utilized through the facilities of the upgraded hospital. It earned a total of P612.863 millions during the last three years but operational expenditures totalled P888.549 millions. Government hospitals are not for profit, rather, public service, health services particularly.

The biggest single loan contracted under the administration of Marquez, is of course, the P260 millions Boracay bond floatation which sold like hotcakes in 2010. This is earmarked for the expansion of port and tourism facilities in barangay Caticlan designed to keep the area atuned with the fast growing tourism industry spurred by Boracay. The Supreme Court of the Philippines issued a temporary environmental protection order (TEPO) stalling for a moment the full implementation of the project.

The revenue generation trends of both the Cagban and Caticlan jetty ports and terminals point to a viable economic prospect for the Caticlan port expansion to be funded by this bond floatation. To date, the outstanding balance of the bonds remains at P187.777 millions which must be fully paid in 2020.

The P30.313 millions loan for the construction of the school of nursing building has a present balance of P15.156 millions. Full repayment is due in 2018. 

The P52.286 millions for the construction of the Calangcang Sports Complex in Makato, Aklan has an outstanding balance of P39.214 millions to be fully repaid in 2019.

Both projects are in compliance with the local government unit’s mandate of delivering relevant and appropriate social services in education and sports development. The minimal income from these facilities is compensated by its impact to Aklan’s population. The school of nursing has enrolled students about half the tuition fees charged by private schools but produces comparatively higher passing rate in nurses’ licensure examination. 

The sports complex in Makato charges a minimal fee for the use of its facilities but it is compensating enough that Aklan is able to comply with its mandate of hosting regional sports meets and enabled local athletes to place prominently in sports competitions. Now, Aklan is always running third, next to Iloilo and Neg. Occ., in the annual regional Palaro.

For Budget Year 2013, a total of P114.089 millions are required to service these debts. Some P77.45 millions as amortization for the principal and P36.624 millions for interest.

Let Aklanons be the judge on how well these loans are being utilized. The provincial government, since 2004, had never defaulted repayments to its financial obligations. The Commission on Audit report in 2011 cited Aklan for its aggressive borrowings to fund the social and economic infrastructures. Debt servicing is well comfortably provided for in its annual budgets, via sound fiscal management. /MP