Conclusion
Government sources point to Republic Act 9184, otherwise known as the government procurement law, which allows government agencies alternative ways to buy supplies or secure services, one of which is through “Direct Contracting, otherwise known as Single Source Procurement—a method of Procurement that does not require elaborate Bidding Documents because the supplier is simply asked to submit a price quotation or a pro forma voice together with the conditions of sale, which offer may be accepted immediately or after some negotiations.”
The same law further states that agencies may resort to Direct Contracting when: “a.) Procurement of Goods of propriety nature, which can be obtained only from the propriety source, i.e., when patents, trade secrets and copyrights prohibit others from manufacturing the same items; b.) When the Procurement of critical components from a specific manufacturer, supplier or distributor is a condition precedent to hold a contractor to guarantee its project performance, in accordance with the provisions his contract; or, c.) Those sold by an exclusive dealer or manufacturer, which does not have sub-dealers selling at lower prices and for which no suitable substitute can be obtained at more advantageous terms to the government.”
But under the same law, the supplier is also required to post a performance bond “prior to the signing of the contract…as a measure of guarantee for the faithful performance of and compliance with his obligations under the contract…in such form and amount as specified in the Bidding Documents.”
Government sources familiar with the project explained that what made Buhay Carinderia Redefined possible was TPB Board Resolution 157, series of 2018, which authorized and approved the “allocation and disbursement of the budget for the Phase 1 of the Project amounting to 80 million plus value-added tax (VAT) and other taxes based on savings to the 2017 corporate operating budget.” The board resolution, which the sources stressed was prepared by the TPB’s Legal Department, was adopted on March 14, 2018, and signed by then-Secretary Wanda Corazon T. Teo, chairman of the TPB; COO Montano; lawyer Mark Steven Pastor, representing the Department of Transportation; Consul General Leo M. Herrera-Lim of the Department of Foreign Affairs; Trade Undersecretary Nora K. Terrado; board member Vanessa L. Suatengco [general manager, Diamond Hotel, representing accommodations sector]; and board member Eduardo F. Pelaez (president, Mapawa Nature Park, representing tourism estates sector).
MOA signed but not ratified by board
Under present rules followed by the TPB, a board resolution is approved by “majority plus one ” of the members, and since there are 11 members of the board (five government representatives including the Secretary, and five private sector representatives), the board resolution was carried because six of them approved it. Prior to Montano’s term of office, however, a government source pointed out, the TPB board “valued more the private-sector signatures,” when approving a project or sponsorship. In the case of Buhay Carinderia, only two private-sector representatives signed the board resolution.
An interesting sidelight to this is the disclosure of one board member who said, “when I started questioning the project, [name of board official] told me, ‘if you won’t sign it, don’t attend the [board] meeting.’ And so I didn’t.” Said board member asked this reporter not to identify the board official, who he said appeared furious that he was questioning the project.
After the present board approved the project, TPB lawyers drew up a memorandum of agreement between the agency and Marylindbert International Inc. The MOA was signed by Montano and Marylindbert CEO Erlinda Legaspi, while Marian Sarah Garate of TPB’s finance department certified that P80 million in funds were available for the project. The MOA was dated March 15, 2018, a day after the TPB board approved the project through a resolution.
TPB sources confirmed, however, the MOA between the agency and Marylindbert itself. was not approved by its board. “The contract will be subject for audit by COA [Commission on Audit], at the same time, the implementation of the project,” said one source. But a separate source pointed out, under the former COO (Domingo Ramon C. Enerio III), the board was more strict when it came to approving projects. “The board approves the policy framework and budget first for the project. Then it ratifies the contract also,” the source said.
The same source pointed out that Marylindbert failed to post a performance bond before it undertook the project, in direct violation of government’s procurement law. The event organizer received three checks amounting to P80.64 million, two of which were released before the project was launched in public; then the third check, six days after the project launch.
The disbursements also contravened the provisions of the MOA, which provided that the TPB would disburse the P80 million in four tranches: P12 million plus value-added tax (VAT) upon signing the contract and submission of the “calendar of events and media plan” [or 15 percent of P80 million plus VAT for the first tranche; P28 million plus VAT, upon submission of the “program flow, program content, exhibit layout, content mechanics and communications plan [or 35 percent of P80 million plus VAT]” for the second tranche; P32 million plus VAT upon submission of “final creatives for merchandising [or 40 percent of P80 million]” for the third tranche; and lastly, P8 million plus VAT upon submission of “end of event/project report [or 10 percent of P80 million plus VAT].”
The bulk of the P80-million project budget was accounted for by media guestings on radio and TV (P10 million), as well as “PR feature articles in major broadsheets and magazines” (P40.15 million). The rest of the budget would go to “D-Day staging two days [eyeballs to eyeballs] for P5.75 million, a regional audiovisual production “to be included in the 12 other regions” [P4.35 million], AVP “to be included in the other Major TV Production for airing in December and major TV networks and TFC” for P5.35 million, among others.
And yet, aside from the media write-ups and airings on network TV news about the launch of the Buhay Carinderia Redefined project launch in April, none of the above had yet to be completed, which makes the release of the entire amount for the project even more suspicious.
This kind of irregularity, current DOT chief Bernadette Fatima Romulo Puyat said, was something she was not “comfortable” with. And as such, she has requested the COA main office, in a letter to its chairman Michael G. Aquino, to look into Buhay Carinderia Redefined and other TPB projects. At the moment, all TPB projects are suspended until the COA issues a clearance.
Image credits: Images from Buhay Carinderia Facebook Page