35 market building owners fail to renew contracts

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BAGUIO CITY  – The City Treasury Office revealed that some thirty five market building owners failed to renew their final 15-year contracts with the city government after the lapse of the 90-day grace period given them.

Meanwhile, City Treasurer Alex Cabarrubias said 92 building owners renewed their final 15-year contracts as of the prescribed deadline last August 31, 2017.

He forwarded the list of those who did renew their contracts to the City Legal Office for the preparation of the appropriate charges for them to vacate the city-owned properties since they no longer have live contracts with the city.

Mayor Maurucio G. Domogan ordered the City Legal office to file the unlawful detainer charges against the concerned market building owners who failed to renew their contracts with the local government or for them to voluntarily remove their structures erected over the city-owned lots so that the city could use the said properties for other valuable uses.

It will be recalled that most of the contracts of the 127 market building owners who constructed structures over city-owned properties through the so-called build-operate and transfer scheme already expired December 31, 2015 and that the local government had been waiting for them to renew their contracts with the provision that after the lapse of the 15-year lease period, the buildings will automatically become the property of the local government without the payment of the reimbursement to the owners for their improvements over the city-owned properties.

In the early 1970s, the city government invited interested investors to build their buildings over the city-owned lots within the city public market occupying them for a certain period with the provision that after the lapse of the agreed period, the improvements will automatically become the property of the local government without reimbursements of the expenses incurred for the purpose.

However, when the lease agreements expired the first time, the said provision stating that the improvements will be automatically the property of the local government were allegedly intentionally scrapped for both the second and third renewals.

Domogan pointed out with the final 15-year contract, the building owners shall have occupied the city-owned properties for more than 60 years which means that they already recovered their expenses in the constructions of their buildings and the introduction of the necessary improvements of the buildings to be fit for occupancy by their lessees.

He explained, in fact, the local government opted to negotiate with the existing building owners for the renewal of their contracts with the provisions for increase in rentals and with the expiration period instead of adhering to the recommendations of the Commission on Audit (COA) for the immediate bidding of the city-owned lots to interested bidders to maximize their potentials in generating additional resources for the local government since they failed to use the said lots for the greater advantage of the city.

By Dexter A. See

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