2012 R - 071 - SUPPLEMENTING THE ASSET PURCHASE AGREEMENT BETWEEN THE CITY AND THE PRIVATE SECTOR AS REQUIRED BY THE COMMISSION ON AUDIT AND EXTENDING ITS “SUNSET DATE”, TO ENSURE PROPER AND SUFFICIENT PROVISION FOR THE CITY’S ELECTRICITY NEEDS AND TO ACCOMPLISH THE FULL UPGRADING MODERNIZATION AND ENHANCEMENT OF POWER PUBLIC UTILITY SERVICE, IN A MANNER CONSISTENT WITH LAW

EXCERPTS FROM THE MINUTES OF THE REGULAR SESSION OF THE SANGGUNIANG PANLUNGSOD OF OLONGAPO, HELD ON JUNE 20, 2012 AT THE CITY HALL.

PRESENT:

Hon. Rolen C. Paulino - -City Vice-Mayor & Presiding Officer

Hon. Rodel S. Cerezo - - - City Councilor

Hon. Eyrma Yvette Marzan-Estrella - - “        “

Hon. Aquilino Y. Cortez, Jr. - - - - - “        “

Hon. James G. Delos Reyes - “        “

Hon. Gina Gulanes-Perez - - “        “

Hon. Elena C. Dabu - - -   “        “

Hon. Eduardo J. Piano - - - - -  “        “

Hon. Edna A. Elane - - - - -   “        “

Hon. Noel Y. Atienza - - -  “        “

Hon. Sarah Lugerna Lipumano-Garcia - -  “        “

Hon. Dolly Mae M. Ramos - - SK Federation President   

ABSENT:

Hon. Carlito A. Baloy - - President, Liga ng mga Barangay (Sick Leave)

RESOLUTION NO. 71

(Series of 2012)

A RESOLUTION SUPPLEMENTING THE ASSET PURCHASE AGREEMENT BETWEEN THE CITY AND THE PRIVATE SECTOR AS REQUIRED BY THE COMMISSION ON AUDIT AND EXTENDING ITS “SUNSET DATE”, TO ENSURE PROPER AND SUFFICIENT PROVISION FOR THE CITY’S ELECTRICITY NEEDS AND TO ACCOMPLISH THE FULL UPGRADING MODERNIZATION AND ENHANCEMENT OF POWER PUBLIC UTILITY SERVICE, IN A MANNER CONSISTENT WITH LAW

WHEREAS, as per survey by the Public Utilities Department, the city is among the remaining local government units in the country engaged in the operation and maintenance of an electric/power utility, and has among the lowest electricity rates in the region;

WHEREAS, given the recent developments in power utility operations, there is a need to upgrade and modernize the existing ageing power facilities of the city and address the technical needs necessary to provide sufficient electric power supply to the local community, which require substantial capitalization and a vast resource base;

WHEREAS, an Asset-Purchase Agreement (APA) was engaged in by the city and the private sector, in an effort to address the ever growing power needs of the city, which increased electricity consumption needs and the need for enhanced facilities and services is a common and prevalent trend in the country;

WHEREAS, the Commission on Audit has already reviewed the “APA” and has directed the city to supplement the existing “APA” with the provisions in its “audit observations” to ensure the complete legality of the “APA” and its implementation in a manner compliant with pertinent laws, rules and regulations, and to ensure its consonance with the best public interest and public welfare;

WHEREAS, to date, the private sector partner, the Cagayan Electric Power and Light Company, Inc. (CEPALCO) has already infused substantial capital in assisting in the upgrade of sections of the power facilities of the city which is the reason for the current stabilizing power service to the local community;

WHEREAS, there is a need to extend the agreed “sunset” date to December 15, 2013 to allow the Public Utilities Department and the private sector partner ample time to continue and finish the undertaken upgrade, enhancement and modernization of current facilities to provide responsive sufficient supply to the people of Olongapo City;

WHEREAS, to address fears of potential arbitrary, unconscionable, oppressive or baseless price increases in the costs of electric consumption, the city manifests its categorical stance that it shall support any rational and legitimate initiative before the Energy Regulatory Commission to block and combat any such arbitrary, unconscionable, oppressive or baseless price increase in the costs of electric consumption which would be anathema to the best interest and welfare of the community;

WHEREAS, the private sector has headed the demand of the city, and has manifested that it shall follow the process and legal requirements with the Energy Regulatory Commission, with the required consultations with the local community and shall exercise maximum prudence and restaurant in effecting any changes in the current electric service set-up in the event that any agreement with it is perfected and fully consummated;

NOW, THEREFORE, on motion of City Councilor Gina Gulanes-Perez with the majority decision of the Members of the Sangguniang Panlungsod present; 

RESOLVED, AS IT IS HEREBY RESOLVED, by the Sangguniang Panlungosd in session assembled, to supplement as it hereby supplements, the Asset Purchase Agreement between the City and the Private Sector as required by the Commission on Audit and extending its “Sunset Date”, to ensure proper and sufficient provision for the City’s electricity needs and to accomplish the full upgrading modernization and enhancement of Power Public Utility Service, in a manner consistent with Law.

APPROVED, June 20, 2012.