Lao hits plan to hike water price by 53%

By LITO RULONA
Correspondent

COUNCILOR Teodulfo Lao Jr. has sounded alarm bells over plans to increase the cost of treated water here by over 50 percent when the Manuel V. Pangilinan-owned Metro Pacific Water Investments Corp. starts supplying to the Cagayan de Oro Water District.

Lao said he feared that the city’s water consumers would shoulder the increase in the price of treated water even as he sought to void the contract between the COWD and Metropac.

COWD chairman Eduardo Montalvan confirmed that the water district would buy from Metropac P16 per cubic meter.

Based on the COWD’s 2005 contract with the current bulk water supplier, Rio Verde Water Consortium Inc., the water district only pays P10.45 per cubic meter.

But there is a difference between the COWD paying a bulk water supplier P16 per cubic meter and the water district actually passing the increased cost on consumers.

According to Montalvan, the price increase would be shouldered by the COWD and would not be passed on to the city’s water consumers.

Montalvan told the Gold Star Daily that the COWD management informed him that Metropac’s price “is way within the profitability of COWD, and it will not affect the rates.”

COWD assistant general manager Bienvenido Batar Jr. said any increase in the water rate for consumers would need the approval of the Local Water Utilities Administration.

“Passing this [increase]  on directly is not possible,” said Batar.

COWD spokesperson Ladelle Sagrado said Metropac’s price is based on a price escalation formula.

“That’s (price) about the same price we would have been paying Rio Verde by now for the scheduled volume delivery had there been no legal issues in the signed contract,” reads Sagrado’s text message to this paper.

Rio Verde senior vice president for operations Joffrey Hapitan earlier complained about the 2005 COWD-Rio Verde agreement, saying the bulk water supplier wasn’t able to increase its treated water rate because of that document, and which is why it wanted out of the contract.

Councilor Lao however said he wanted the contract between COWD and Metropac rescinded after the city council’s public utilities committee was informed that the Pangilinan firm would charge P16 per cubic meter vis-à-vis the 2005 Rio Verde rate of P10.45 per cubic meter. He said it showed a “60-percent increase.” (The increase is roughly 53 percent and not 60 percent based on Gold Star Daily’s calculations.)

The signing of the COWD agreement with Metropac was done before Mayor Oscar Moreno and councilors Ian Mark Nacaya, Suzette Daba and Jay Pascual, and other city officials at Makati Shangrila last month. Pangilinan was there while COWD was represented by Montalvan and water district general manager Rachel Beja.

The agreement was for a joint venture aimed at boosting the supply of treated water in the city to 100 million liters a day.

The COWD-Metropac joint venture agreement would involve the construction of new water transmission lines, rehabilitation of the Camaman-an reservoir, and the delivery of bulk treated water for the western areas where the supply is problematic.

The P16 per cubic meter price was revealed during the meeting of the city council’s public utilities on Friday, called because of the water crisis gripping some parts of the city. Rio Verde promised the committee that it would completely restore the supply of treated water to COWD by today.

“Ingon pa nila sa taga-COWD, anytime ma-annul ang contract with Rio Verde og nagduda kami tungod kay mahal ang ilang gipirmahan,” Lao said.

He said his committee and the general public were unaware of the COWD-Metropac agreement, including the planned price increase.

“We are now asking people to participate in the discussion. We are inviting lawyers to help us nullify the contract tungod sa kamahal og dili favorable sa public,” Lao said.

He said the committee asked COWD to submit all documents related to the Rio Verde and Metropac contracts.

“Dili sila magbuot-buot kay sila ra ang nasayod. Ang consuming public baya ang gabayad kanila. Dili pwede nga sila ra magsabot-sabot,” Lao said. (with reports from herbie gomez)