CITY OF SAN FERNANDO—When the government submerged Pantabangan town in Nueva Ecija in 1973 to create a lake that fed what was touted then to be the second largest dam in Asia, more than 1,300 residents yielded to the plan and rebuilt the town on a mountaintop.
On the 40th year of its relocation, Pantabangan (population: 25,520 as of 2010) has become a first-class town, with an average annual income of at least P55 million.
It is, however, mired in serious financial troubles although it earns a lot from power generation that is fed by the town’s abundant supply of water, reports of the Commission on Audit (COA) showed.
The problems are bound to drag on this year because local officials have not implemented most of COA’s recommendations since 2009.
Because of the alleged mismanagement of local government funds, Gerardo Sator of the civic group La Solidaridad had sued Mayor Romeo Borja Sr. for graft at the Office of the Ombudsman.
Antonio Capia, head of Pantabangan Municipal Government Employees Association, filed a case in a Nueva Ecija Regional Trial Court on Jan. 3 to compel the mayor to release the salaries and benefits of some 200 employees.
“Our town has been buried twice,” said Capia, 59, referring to the 1973 displacement and the ongoing alleged fund misuse.
Borja said Sator’s case has “political color,” while the case claiming salaries and benefits is to “be blamed on the employees themselves.”
By the end of 2011, the COA said the local government reported an income of P187.9 million and expenses of P152.5 million.
In the same year, its cash amounted to only P25.2 million and receivables, P169.9 million. However, current liabilities stood at P257.2 million; long-term liabilities, P104.8 million; and deferred credits, P10.8 million.
Accounts payable, worth P74.8 million, are debts by the local government-run Pantabangan Municipal Electric System (Pames) to First Gen Hydro Power Corp., National Transmission Corp. and National Power Corp.
The debts to First Gen grew despite its advanced payments of real property tax and as residents paid their bills on time to Pames.
The mayor blamed the people. “The people have unpaid bills of P73 million,” he said by telephone.
Borja, who is running for reelection, questioned the figures in the COA report. “The problems did not just happen in my time,” he said.
According to the COA, the local government violated several laws in handling public funds.
It said unliquidated cash advances totaled P40.6 million, over half of which were spent without specific purposes.
Cash and receivables were overstated while expenses were understated, said the COA, which recommended the filing of charges.
The local government did not remit withholding taxes to the Bureau of Internal Revenue, shares in the premiums of employees to national government agencies and real property taxes of 14 barangays. These total P99.9 million.
Borja said the figures were results of “reports that were filed twice.”