BAGUIO, Philippines – The city government of Baguio has demanded that the Bases Conversion and Development Authority (BCDA) settle an outstanding debt of P225.45 million, a long-standing obligation tied to revenue-sharing agreements for the operations of Camp John Hay.
In a January 20 resolution, the Baguio City Council cited the Supreme Court’s final ruling on the legal dispute between BCDA and Camp John Hay Development Corporation (CJHDevCo), which has removed any barriers to fulfilling these obligations.
Camp John Hay, once a US military rest and recreation facility, is a major tourist and mixed-use destination in Baguio. It features hotels, a golf course, residential areas, and open spaces. It has been embroiled in legal and financial disputes, mainly over lease agreements and developer obligations.
Baguio Councilor Peter Fianza, who confirmed that the city government has issued the demand, said, “We are trying to work it out with John Hay to have it deducted from DevCo’s payment. We are scheduling talks.”
The financial demand is based on Sections 9 and 10 of City Council Resolution No. 362-1994, which set 19 conditions for the BCDA’s master development plan for Camp John Hay.
One of the provisions, Condition No. 9, requires BCDA to share 3% of the gross income from operations within the John Hay Special Economic Zone (JHSEZ) with the city government and allocate 1% to a community development fund managed jointly by city hall and BCDA, totaling 4% of gross income owed to Baguio City.
Another, Condition No. 10, mandates BCDA to remit 25% of lease rentals or 30% of net income from JHSEZ operations, whichever is higher.
Under these terms, BCDA owes Baguio City P56.84 million from gross income (Condition No. 9) and P168.60 million from lease rentals (Condition No. 10).
While BCDA has paid P238.62 million for Condition No. 10 over the years, city hall said it still owes P168 million, with the total obligation at P407.22 million.
The City Treasurer’s Office previously estimated a higher unpaid balance of P817 million in 2016 based on CJHDevCo’s lease agreements with BCDA.
Officials also noted the amounts owed could increase as the treasurer completes an inventory of businesses in the area not registered with the Philippine Economic Zone Authority (PEZA), which could add to the city’s share of gross income.
Local officials plan to meet with BCDA in February to discuss the debt and other issues related to Camp John Hay.
Baguio Vice Mayor Faustino Olowan underscored the need for collaboration.
“We will ask our financial managers to sit down with their counterparts at BCDA to discuss the matter, together with our mayor,” Olowan said.
Hilario Paderes, BCDA chairperson, said the BCDA would respond only after the city government communicates with them.
“We have not received any letter,” Paredes said. – Rappler.com