The refusal of the Sobrepeña-led Camp John Hay Development Corp. (CJHDevco) to remit its lease payments to the Bases Conversion and Development Authority for the Camp John Hay property has prevented the Baguio City government from completing its acquisition of the Baguio Convention Center.
According to BCDA vice president Dean Santiago, the Baguio City government was supposed to use the proceeds from the John Hay property lease to acquire the convention center. The local government is entitled to 25 percent of the lease payments made to BCDA.
Under an agreement between BCDA and the Baguio City government inked in 2004, the BCDA would directly remit to the Government Service Insurance System, owner of the Baguio Convention Center, Baguio City’s payment for the acquisition, Santiago said.
However, since CJHDevco stopped remitting lease payments for the Camp John Hay property to BCDA, Baguio City’s payment for the convention center had likewise ceased, Santiago said.
“CJHDevco’s refusal to pay its rental obligations to BCDA is prejudicial to the people of Baguio City,” the BCDA executive said.
CJHDevco’s restructured arrears had ballooned to P2.4 billion, plus another P382 million in unpaid lease from December 2009 to June 2011.
Had CJHDevco been faithful in remitting its lease payments to BCDA, Santiago said Baguio City would have been able to make the annual payments for the convention center and would not have incurred interest, which now amounted to P128 million.
Baguio City’s outstanding balance was trimmed to P218 million from P328 million, following BCDA’s recent remittance of P60 million and the GSIS’ decision to waive P50 million in interest charges.