For 93-1 lots City government, residents want fair property valuation

CEBU, Philippines — The Cebu City government has stepped in to iron out the finality of the rates for 93-1 lots, which were first based on the outdated tax rates of the city, thus corresponding to lower property costs.

Last Friday, Mayor Raymond Alvin Garcia and the residents of the 93-1 areas convened to go over the counterproposal that they will present before the Cebu provincial governor, as the loan applications are now being processed.

He added that this is in line with his initiative to serve as the intermediary between the governor and the 93-1 residents.

However, Garcia said that upon reviewing the proposal, he discovered that among the bases of the pricing was Cebu City Hall’s property valuation, which, he added, has not been updated since 2003.

“So it is 20 years ago; the property worth 1,000 now might already be 10,000, so I said we have to be fair here, we cannot just use (the outdated tax rates),” said Garcia.

According to Garcia, he recommended that the valuation be based on the value according to its last sale. He explained that Cebu City Hall’s Assessor’s Office determines the value of each property.

However, it is only the city council that can increase the valuation, and in the absence of such action, the valuation remains the same, hence the outdated valuation since 2003.

Garcia, however, said that when someone purchases a property and transfers it to another person’s name, the city government will require the submission of a deed of sale, which will be the basis for the transfer taxes.

He added that since the tax rates imposed on the deed of sale are more updated than basing it on the city’s standing valuation, it makes sense to base the rates on the taxes imposed on the deed of sale.

Garcia also noted that the City Assessor does not have the authority to align the rates of sale taxes and the city’s valuation since its power only lies with the city council.

“So, what I am telling the City Assessor is, give me the values based on the latest deed of sale and those from surrounding areas, so it reflects the Fair Market Value instead of using our (city) own rates,” said Garcia.

Councilor Noel Wenceslao, chairman of the Committee on Budget and Finance of the Cebu City Council, has authored a proposed ordinance to revise the Real Property Tax (RPT) by updating the market valuation, which has reached the second reading. Once approved, this could result in updated but increased tax rates for the city.

However, just before it could reach its final deliberation and approval, on June 13, 2024, President Ferdinand Marcos Jr. signed into law the Real Property Valuation and Assessment Reform Act (RPVARA), which aims to standardize, streamline, and enhance the country’s valuation and assessment of real property through a uniform appraisal that complies with international standards.

This superseded the supposed provisions of the revised RPT ordinance, thus halting the update of the current tax rates of the city.

Despite the possible surge in the rates of the 93-1 lots should Garcia’s recommendation go through, Garcia said the residents have agreed to this.

“They will work with the Assessor’s Office to get the Fair Market Value of the properties under 93-1,” said Garcia.

He added that the 93-1 residents need to understand that once a sale between the Cebu Provincial Government and the residents is pushed through, it will be subjected to an audit before the Commission on Audit (COA).

“When we sell our property, it has to be up to the Fair Market Value so that the government won’t lose out,” said Garcia.

He reiterated that the 93-1 residents are willing to pay at the current price to avoid surges should there be any delays.

To recall, in December 2018, then-Mayor Osmeña and then-Governor, now Vice Governor, HilarioDavide III, signed a Memorandum of Agreement for a land swap between the city and the province, covering 32 hectares of province-owned lots under Ordinance 93-1, located in several Cebu City barangays.

The lots subject to the agreement also included 1.5 hectares in the Department of Agriculture compound along M. Velez St., 2,358 square meters on Gorordo Ave. in Barangay Lahug, and 577 square meters on Don Gil Garcia St. in Barangay Capitol Site.

The 93-1 beneficiaries are from the barangays of Kamputhaw, Capitol Site, Kalunasan, Busay, Luz, Lahug, Mabolo, Apas, Lorega, San Miguel, Kasambagan, and Tejero.

In a report by The Freeman on March 15, 2023, it was stated that the Cebu Provincial Board had revoked the Memorandum of Agreement and subsequent deeds of donation entered into between the provincial government of Cebu and the Cebu City government concerning the lots under Provincial Ordinance 93-1.

The resolution, authored by PB Member John Ismael Borgonia, cited the “defective” lot donations and the continuously failed land swap negotiations between the two local government units as reasons for the revocation.

To recall, Cebu Governor Gwendolyn Garcia issued a final ultimatum for occupants of the Cebu provincial government-owned lots under Provincial Ordinance 93-1, giving them until March 7, 2025, to process their housing loan applications with Pag-IBIG Fund.

Mayor Garcia, however, said that despite the ultimatum, all residents were able to comply with the loan applications. — (FREEMAN)