Present officials of the Philippine Reclamation Authority (PRA) and its subsidiary, Public Estates Authority Tollway Corp. (PEATC), inherited from past administrations a huge, festering headache worth billions of pesos called the Manila-Cavite Expressway (CAVITEX).
PRA chairman Alex Lopez and PEATC officer-in-charge president Dioscoro Esteban found themselves pitted against the business conglomerate of Manuel V. Pangilinan (MVP) as they try to regain control — in behalf of the government — of their duty to collect toll fees in the 14-kilometer tollway, and to maintain and operate the facility.
The government firms alleged that the MVP Group has collected P28 billion from 1998 from motorists using the CAVITEX but turns over only 10 percent of that to the government, giving itself 90 percent of the income. The PEATC claimed that by now, the sharing should be 60-40 in favor of the government.
When PEATC’s Esteban filed a Writ of Mandamus with the Court of Appeals in an effort to regain control of CAVITEX, the Cavitex Infrastructure Corp. (CIC) president Rogelio “Babes” Singson replied that he did not have the legal personality to do so, since he does not have a board resolution giving him the authority to file a mandamus.
Since the PEATC is a creation of the PRA, it was Chairman Lopez’s turn to set the issues right.
Lopez said the PEATC enjoys the full support of the PRA board and himself in fighting the formidable MVP conglomerate on the issue of CAVITEX.
It has now become a fight to regain for the Philippine government what is rightfully its own: the enjoyment of the fruits of its own assets.
Buyout Offer
The PRA received a buyout offer from the CIC in the amount of P2.5 billion so that the MVP group can have full control of the original Joint Venture that took over the maintenance and operation of CAVITEX.
The Lopez-led PRA board found this offer “unfair” and detrimental to the state’s interest. The offer by the CIC, which is under the Manny Pangilinan-led Metro Pacific Tollways Corp., was made before the expiration of the operating and maintenance agreement (OMA) on Aug. 25, 2021.
“Upon cursory examination, the offer appears to be egregiously unfair, unreasonable, and morally objectionable,” the PRA said.
We believe these adjectives fully describe the CIC’s offer, since the amount corresponds to only one year’s income of CAVITEX.
Latest Caper
Transport advocate and PEATC spokesman Ariel Inton called the latest caper involving the Manila-Cavite Expressway the “Biggest Highway (Tollway) Robbery.”
Two weeks ago, the PEATC held a press conference in Quezon City to answer a previous presscon by the CAVITEX Infrastructure Corp. (CIC) which assailed PEATC’s going to court in an effort to regain control of the operations and maintenance (O&M) of the lucrative tollway.
PEATC's Steve Esteban, who said he is a Duterte appointee but was made OIC by the board just more than seven months ago, clarified that the operations and maintenance agreement (OMA) that gave CIC the O&M responsibility of CAVITEX ended on Aug. 25, 2021, based on Philippine Reclamation Authority Board Resolution 5383.
Esteban said the O&M of CAVITEX should have been turned over to PEATC – a government-owned and -controlled corporation created by the PRA for tollways management – beginning January 1, 2022.
From the current 90 percent to 10 percent revenue-sharing in favor of CIC, he said CAVITEX revenue-sharing would change to 60 percent to 40 percent in favor of the government once the O&M returns to PEATC.
He noted that a toll decrease on CAVITEX is possible once the O&M of CAVITEX is returned to the government. Esteban said they continue to engage the private firm in dialogues but they insist on their way of running the business, saying the Commission on Audit has no jurisdiction over them because they are private.
Corruption In The Tollway
In addition to CIC’s refusal to turn over CAVITEX, Esteban alleged that he witnessed “rampant corruption” in CIC’s operations through the existence of tollbooths with no point-of-sale (POS) machines.
These toll booths, he said, still receive payment from expressway users despite not recording these transactions in their system, and thus are untaxed revenue.
Esteban disclosed that a modular booth of this nature which does not report revenues funnels all the money collected to the CIC, which is about P267,000 a day of operation or P8,010,00 for 30 days.
Metro Pacific’s Side
Meanwhile, the Metro Pacific Tollways Corporation (MPTC) believes that the case filed by the PEATC against its subsidiary, Cavitex Infrastructure Corporation (CIC) will be dismissed.
In a press conference, MPTC President & CEO Rogelio L. Singson pointed out that PEATC Officer-in-Charge Dioscoro Esteban Jr. has no authority in filing for a writ of mandamus without a PEATC Board approval since there is no PEATC Board to begin with.
The PEATC is a wholly-owned subsidiary of the PRA. Singson also questioned the absence of the PRA as a respondent, being a part of the Joint Venture Agreement with CIC for the Manila-Cavite Toll Expressway Project.
MPTC has consistently extended invitations to PEATC for a proper dialogue but were unfortunately disregarded.
Singson added, “We believe that, based on the advice of our lawyers, the case should be dismissed outright by the Court of Appeals because of a false and defective verification and certification and something as basic as filing the mandamus without proper authority of the PEATC or PRA Board and without the sign-off of the proper counsel, the Office of the Government Corporate Counsel (OGCC).”
It should be noted that PEATC is a government corporation without an original charter, so that its operation is governed by the Corporation Code.
“A writ of mandamus is the first step towards that direction. We need that to calculate how much we should be charging for,” Esteban said.
In February, a writ of mandamus was filed before the Court of Appeals (CA) due to the CIC’s refusal to turn over CAVITEX.
Esteban emphasized that the case is not a dispute, but is a request for help from the CA for the proper turnover of the project, and thereby not part of any arbitration agreement.
“Bakit sinasabing walang dispute? Kasi ang mandamus, it means ministerial duty. Meron duty itong taong ito na hindi niya ginagawa (Why are we saying there is no dispute? Because mandamus is about ministerial duty. This person has a duty that they’re neglecting). They should comply,” he said.
He added that the Commission on Audit (COA) has sent the PEATC multiple audit observation memos due to their failure to take control of CAVITEX, noting that the CIC is immune from the same government oversight as a private company.
“Walang kontrol ang gobyerno sa budget nila. So hindi sila pwede i-audit ng COA (The government has no control over CIC’s budget. That’s why COA can’t audit them),” Esteban pointed out.
Meanwhile, it was pointed out that accepting the offer would also result in the dissolution of the PEATC, a government-owned and -controlled corporation (GOCC) created by the PRA for the operation, maintenance, and toll collection of CAVITEX.
“It is advisable for CIC to conduct a comprehensive review of pertinent statutory and regulatory frameworks, cognizant of the unique constraints and obligations inherent in transactions involving GOCCs,” it said.
Following the expiration of CIC’s OMA in 2021, operations and maintenance of CAVITEX should have been turned over to PEATC beginning Jan. 1, 2022, in addition to a revised revenue sharing agreement of 60-40 favorable towards the government instead of the current 90-10 in favor of CIC.
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