A group of taxpayers in San Pablo City, Laguna suffered an initial setback in its fight to stop the city from obtaining a P900 million loan from a private bank that the Department of Finance said the city wasn’t capable of paying.
Judge Agripino Morga, of San Pablo Regional Trial Court Branch 32, ruled the loan to be “valid” and “effective” in a decision on Wednesday.
Morga dismissed the petition of a Church-backed group of San Pablo residents seeking to stop the city government from proceeding with the loan agreement with the Philippine Veterans Bank (PVB).
The DOF has issued a certification saying San Pablo’s borrowing capacity was only up to P500 million.
Residents, represented by Rowena Valedllon and Esteban Silva Jr., described the loan deal as anomalous.
Judge Morga said he found no irregularity in the ordinance, authored by Councilor Edgardo Adajar.
The city government plans to use the P900 million as follows: P140 million to pay for a previous loan, P200 million each for a multipurpose convention center and tourism and economic center, P180 million for a food and transport terminal and P50 million to buy land for the convention center.
Reached for comment, lawyer Job Gesmundo, the legal counsel of the loan opponents, said they would appeal the court ruling. Maricar Cinco, Inquirer Southern Luzon, reporting from San Pedro, Laguna