Carbon Market Unit II earnings enough to pay off loan

CEBU, Philippines - The Cebu City Market Operations Division (MOD) is optimistic that once operational, the Carbon Market Unit II can earn enough revenues to pay the loan that the city government might avail for its construction.

To recall, the city government was offered by the Municipal Development Fund Office of the Department of Finance (MDFO-DOF) a loan that is granted to Local Government Units for income-generating projects.

The reconstruction of Carbon Market Unit II that was destroyed by fire over a decade ago, has an estimated total project cost of P240 to P270 million.

While the city government has already allocated P70 million initially for the purpose, it needs another P170 million to realize the project.

Market Administrator Raquel Arce said if the Mayor would want to avail of the P170-million loan, the projected income of the Unit II at P19.9 million annually from stall and space rentals, entrance and landing fees and parking fees, may pay for the loan in 10 years.

Arce said they can also pay for the interest which, according to the DOF, is fixed at eight percent payable for a 15-year period.

But she clarified that this doesn’t mean the city will avail the loan.

The mayor asked her to do a feasibility study on whether they can pay for the loan with their projected revenues in case there won’t be other sources of funds for the project.

A source in city hall said the mayor tasked someone to pursue a grant which they would prefer instead of a loan.

In the feasibility study, Arce indicated that they are projected to earn some P18,536,040.00 from stall and space rentals, P600,000 from entrance and landing fees and P800,000 from parking fees.

The rental for space is computed at P10 per square meter per day which will increase by 20 percent every five years.

Arce said that the P19.9 million projected revenue is for the Carbon Market Unit II alone once it becomes operational. The revenues of other areas in Carbon such as the Freedom Park, Warwick Barracks, Unit I and Unit III will not be touched.

Arce said that the construction of the Unit II building has been pending for 13 years already since it was gutted by fire in 1998.

The fire displaced 500 stallholders who were relocated along the stretch of M.C. Briones St.

When the M.C. Briones was cleared, some of the stall holders went back to the Unit II but without proper spaces.

Arce said the council wants to implement the project on a staggered basis will not be beneficial to the present occupants of Unit II because it means they will be displaced for a longer time.

She said her office is appealing to the council to allow the one-time implementation of the rehabilitation of Unit II.

She said the P70 million standby funds that the council wanted to spend first could not even build a gym-type market with no proper divisions and is not even enough for the foundation of the building.

The Department of Engineering and Public Works estimated that the project would now cost about P300 million considering the prices of materials.

They will still follow the original plan created years ago when the project was supposedly implemented but did not push through. Back then, the project cost was P144 million based on prevailing market prices more than six years ago.

Arce said if the occupants of Unit II will be displaced for a long period of time, the streets in Carbon where they will likely be relocated will again have to suffer congestion for a long period of time too. – (FREEMAN)