Camp John Hay lessee urged to pay government P2.7 billion

MANILA, Philippines - Two Mindanao congressmen are urging a private corporation managing the state-owned Camp John Hay in Baguio City to pay the government more than P2.7 billion in long-overdue rentals.

In a resolution, Representatives Rufus Rodriguez of Cagayan de Oro City and his brother Maximo, who represents the party-list group Abante Mindanao, said the lessee, Camp John Hay Development Corp. (CJHDC), has failed to settle its debt despite repeated demand.

They said CJHDC was organized by Fil-Estate Development Corp. in 1996 when the Bases Conversion and Development Authority (BCDA) awarded it a lease contract to develop, manage and operate Camp John Hay for 25 years, renewable for another 25 years.

“While the original lease contract was signed by BCDA and CJHDC in October 1996, it was revised in July 2000, July 2003 and again in July 2008, with the last revision stating that the Sobrepeña-led company would pay its outstanding debts of close to P2.7 billion, representing unpaid rentals and interest charges,” they said.

The two lawmakers said the BCDA even decided to forego about P300 million in interest charges in 2008 when the lessee paid P100 million in cash and turned over assets worth P180.3 million.

They noted that CJHDC’s debt has increased again since it failed to pay BCDA P381.8 million representing almost two years of rent from December 2009 to June 2011.

That huge amount is on top of the P2.4-billion outstanding debt as of July 2008, they stressed.

The two congressmen pointed out that the people and city government of Baguio have a stake in the settlement of CJHDC’s obligations since the city has a 25-percent share in the lease payments.

They expressed support for the legal action taken by the BCDA to collect from its lessee and to evict it from Camp John Hay.

The camp used to serve as a rest and recreation center for American soldiers when the United States had bases in the country. It is now among Baguio City’s tourist attractions. It has a hotel and a golf course, among other facilities.

The Sobrepeñas are the same family that founded College Assurance Plan (CAP), which ran into trouble when it started failing to pay the tuition reimbursement claims of thousands of holders of college education plans.

A court has appointed an administrator to run the failed company, whose plan holders have to wait for years for their reimbursements, which have been reduced to just a small fraction of the amounts contained in their insurance policies.