City Council ratifies P120M CPA compromise agreement

The P120-million compromise agreement between the Cebu City government and the Cebu Port Authority was finally ratified yesterday by the city council, paving the way for the settlement of the agency's overdue taxes to the city.

"After both parties have evaluated their respective positions on the issues on real property taxes and after a series of consultations and negotiations, the parties arrived at the conclusions that it is the best interest of both that a compromise agreement be entered into such terms and conditions, which are not contrary to law, morals and public policy," stated the ratified resolution of councilor Sylvan Jakosalem.

During the visit of President Gloria Arroyo last week in Cebu, CPA general manager Mariano Martinez handed over the P120-million check to Mayor Tomas Osmeña, as a compromise settlement for the tax obligations.

The council, in yesterday's regular session, unanimously approved the Jakosalem resolution ratifying the compromise settlement because it did not include provisions that would waive the tax penalties anyway.

Majority Floor Leader Jocelyn Pesquera, also the budget and finance committee chairman, said she did not object the resolution considering that the tax penalties were not waived.

Based on the report of the city treasurer, computed as of last December, CPA has tax dues amounting to P186-million, without interest yet. Jakosalem argued that the amount did not include adjustments due to depreciation and deactivation of buildings, equipment and fixtures of the CPA.

But before the council ratified the compromise pact, it asked the city attorney's office to furnish the body all files or documents on the matter.

Pesquera also moved that the council must study first all pleadings of both the CPA and the city government that would be filed in court for the dismissal of the legal actions raised in court before the compromise.

Under the compromise agreement, both parties agreed that first the real property tax dues for 2006 and the succeeding years be subjected first to discussion. It further stated that it will not prevent any party from raising legal issues that may arise in the future. - Garry B. Lao