COA asked to stop NHA’s P1.12-B payment to company doing Smokey Mountain reclamation

/ 05:54 PM July 03, 2020

MANILA, Philippines — The Commission on Audit (COA) should stop the National Housing Authority (NHA) from paying P1.12 billion to a firm handling the now-defunct Smokey Mountain Development Corporation and Reclamation Project (SMRDP), a former lawmaker said.

In a letter to COA chairperson Michael Aguinaldo, Bayan Muna chair Neri Colmenares said that he is opposing NHA’s plans to pay the said amount and transfer almost five hectares of government land to R-II Builders, Inc. (RBI) to settle legal disputes in the past.


Colmenares asked why NHA’s current officials allowed such settlement when former officers have cautioned against the deal.

“Former NHA officials, including NHA’s own lawyer – the Office of the Government Corporate Counsel – have cautioned against the deal. They question the computation of NHA’s supposed liabilities, legal interests as well as the valuation of government land that’s part of the deal. With all these questions, why the rush to pay?”, he asked.


“To prevent dissipation of State assets […] NHA should submit all required documents to state auditors who should make a final determination whether it is legally justifiable for the housing agency to enter into the proposed settlement with RBI,” he added.

COA previously cautioned NHA against the alleged lopsided deal, which was based on a Court of Appeals (CA) ruling approving the compromise deal between the government and RBI.  In the May 2019 ruling from CA, the court said that an additional payment — the P1.12 billion and the 4.5 hectare Vitas property — should be made.

READ: CA approves compromise deal on Smokey Mountain project 

The deal came about after RBI entered into a joint venture agreement with NHA, back during administration of former president Fidel Ramos, to turn the Smokey Mountain dumpsite into a by-the-bay community, with decent housing for around 3,000 poor families.

However, the project involved a lot of legal cases when RBI entered into an asset pool arrangement with several government financial institutions after it ran out of money to complete the project.

READ: CA stops P1.1-B NHA settlement with developer

READ: NHA warned on deal to settle Smokey Mountain row 


Colmenares said that Congress, which basically deliberates the government’s annual budget, should have a say in the said issue.  But aside from this, he noted that the payment should not be done hurriedly especially since the government is currently dealing with a lot of expenditures due to the COVID-19 pandemic.

“At a time of severe economic hardship and as government resorts to borrowings to feed millions of hungry and jobless Filipinos during the COVID-19 pandemic, it’s unconscionable for NHA to disburse limited public funds to pay questionable settlement fees to a private entity,” he said in his letter.

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TAGS: Bayan Muna, COA, COA chairperson Michael Aguinaldo, Commission On Audit, compromise agreement, legal dispute, National Housing Authority, Neri Colmenares, NHA, Philippine news updates, R-II Builders Inc., RBI, Smokey Mountain Development Corporation and Reclamation Project, SMRDP
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