Tuesday, February 8, 2011

Aquino stops auction of Quezon power plant

By Delfin Mallari Jr.
Inquirer Southern Luzon
First Posted 16:56:00 02/08/2011


LUCENA CITY, Philippines—The scheduled public auction on Wednesday of the properties of Team Energy (TE), operator of the 735-megawatt coal-fired thermal power plant in nearby Pagbilao town, has been indefinitely postponed upon the request of President Aquino, Quezon Governor David Suarez said Tuesday.
“The auction is postponed in deference to the President’s request,” Suarez told the Inquirer in a phone interview.
He said he met with President Aquino in Malacañang Monday afternoon and discussed the back taxes TE owed the local governments of Quezon and Pagbilao that have ballooned to P6.1 billion.
He said the meeting, which lasted for two-and-a-half hours, was also attended by Budget Secretary Florencio Abad, Executive Secretary Paquito Ochoa Jr. and key officials of the Quezon governor’s office.
Suarez said that during the meeting, Mr Aquino brought up possible scenarios—such as a ballooning of the country’s national debt, loss of trust by foreign investors, similar actions by local government units— that could arise if the local governments of Quezon and Pagbilao proceed with their planned action to collect the back taxes.
“I understand the situation of the national government. What the President has in mind is the interest of the whole country,” Suarez said.
Suarez said Mr. Aquino’s “economic managers and representatives from Quezon and Pagbilao will meet next week to iron out the details of a compromise... on how to amicably settle the back taxes."
Suarez said Mr. Aquino also promised him that the country’s chief executive will visit Quezon to explain the issue from the “presidential perspective”.
However, the governor said he made it clear to the President that the provincial government and the Pagbilao municipal government were determined to collect the taxes that were due them as these were needed to various projects.
“We’ve been fighting for these taxes for the past 10 years and the Supreme Court has already sided with us in its recent decision. It’s about time that our constituents benefited from it,” said the governor.
Suarez said the plant operator could not escape responsibility for the payment of the back taxes.
“The court ruled that the plant should shoulder all taxes due the local government because they were the owner of the properties,” he said.
However, TE officials maintained that the tax issue should be addressed to the National Power Corp. and not to the plant operator.

The 200-hectare power plant lies at Isla Grande in Barangay Ibabang Polo in Pagbilao.

Last December, the Quezon provincial government and the municipality of Pagbilao issued a final notice of delinquency to TE in a bid to collect P6.1-billion real property taxes from 1997 to 2010.

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