Makati City Building overpriced by P124M


makati parking buildingAn initial evaluation by a special team of the Commission on Audit (COA) on the controversial Makati City Hall 2 parking building showed a “very significant” discrepancy of P124 million between the contract cost and COA’s “evaluated cost,” according to a COA official.

The five-phase parking building project has been the subject of an investigation by the Senate body amid allegations that it was overpriced.

p14 (3)During a Senate investigation, Alexander Juliano, director of COA’s fraud office audit, read before the blue ribbon sub-committee, an eight-page preliminary report by the team, which was later furnished to reporters.

The report showed that COA’s evaluated cost for the first four phases of the project was P2.126 billion while the actual contract cost was P2.011 billion for a difference of about P124.6 million.

For all five phases of the project, the report showed that the city government had disbursed an aggregated amount of P2, 367, 679.633.95 as of Dec. 31, 2013, including the preliminary services amounting to P11, 974, 900 and P75,614, 953.01 for the Building Management System.

cayetano trillanesSenators Peter Cayetano and Antonio Trillanes presiding over a hearing of the Senate ethics sub-committee over alleged over-pricing of the Makati City Parking Building 2

 Undue Haste

 A preliminary report by a Commission on Audit (COA) special audit team showed that the Makati City Parking Building was “implemented with undue haste as there were no construction plans yet when it was bidded out and awarded to Hilmarc’s Construction Corp.”

“A perusal of the records will show that Phase 1 was implemented with undue haste,”  said the report read during a hearing by the Senate ethics subcommittee, by Alexander Juliano, director of COA’s fraud office audit.

“Firstly, there was only a gap of one month from the passage of the appropriation ordinance on Nov. 8, 2007 when the IAEB for the project was advertised on Dec. 6, 2007.” IAEB stands for Invitation to Apply and Submit Eligibility to Bid.

“While the swiftness of the action taken by the government may be considered as efficiency, the same could also be considered as a red flag because this project with such a huge budget will surely require a careful conceptualization and planning,” said the report.

It also appears, it said, that the negotiated procurement adopted by the BAC on the contract of architectural and engineering services “was improper because none of the conditions laid down under Section 53 of the Implementing Rules and Regulations of R.A No. 9184.

The report further noted that that the city started the procurement process for Phase III on Nov. 27, 2009 even if there was no appropriation yet at that time.

“The covering appropriation ordinance was only enacted on September 14, 2010,” it pointed out.



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