BY CRIS DIAZ CAGAYAN
DE ORO CITY: Cagayan de Oro City Mayor Rolando Uy wants the joint venture contract between the Cagayan de Oro Bulk Water Inc. (COBI) and the Cagayan de Oro Water District (COWD) rescinded.
Uy made the statement Wednesday as a stalemate between the Local Water Utilities Administration (LWUA), COWD and COBI remained unresolved.
The City Executive said that rescinding the contract will resolve the ongoing row between the COBI, COWD and LWUA.
Uy said that once the contract is rescinded, the COWD could start inviting new players to bid as bulk water supplier of the water district.
“The Metro Pacific Investment Corp. (Metropac) is free to participate in the bidding,” Uy said.
The City Mayor, however, said that the bidding and the provisions of the contract must be transparent and be submitted for public scrutiny.
Uy lamented that the cause of the ongoing row between the COBI and COWD took place because the contract did not undergo public scrutiny.
He cited the existing COBI-COWD contract as onerous and unfair to water consumers because the COBI enjoys the liberty to increase water rates every three years without public consultation and approval of LWUA.
COBI, the bulk water supplier, was an offshoot of the joint venture agreement between Metro Pacific Investment Corp. and COWD sometime in 2017.
The joint venture agreement created COBI as a corporation where Metropac is a majority shareholder and COWD as minority shareholder.
The controversy started when COWD refused to pay water bill that ballooned to P 475 million, seven years after COBI and COWD signed the joint venture agreement in 2017.
COWD maintained that the water district pays its water bills based on the 2017 rates of about P 16 per cubic meter consumption. COBI, however, billed COWD the water bills under its escalated water rates hike every three years after the signing of the joint venture agreement with the water district.
Since May 2024, the row between the COWD and COBI escalated into a legal battle, which exacerbated when LWUA takes full intervention of the COWD operations in June 2024.
COWD refused to acknowledge LWUA and banned entry of LWUA’s appointed interim general manager and board of directors following an opinion issued by the Department of Justice (DOJ) on July 18, 2024.
The DOJ legal opinion cited that the LWUA could take over water district operations if the water district defaulted its loan obligations with the LWUA.
COWD maintained that ever since the water district never defaulted its loan obligation with the LWUA and the water district is managed very well.
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