City waives claims over NPC property

City officials recently decided to waive all claims, causes of actions, charges, assessments, and other collectibles of the local government from the Power Sector Assets and Liabilities Management (PSALM) Corporation upon the execution of the deed of transfer and conveyance and its confirmation of the parcel of land known as the Baguio property along Sanitary Camp.

Under Resolution No. 476, 2021, signed by Mayor Benjamin B. Magalong, local legislators stated that in return, PSALM shall also waive all its claims, causes of action, charges, assessments, and other collectibles from the local government upon the execution of the deed of transfer and conveyance and its confirmation of the aforesaid parcel of land.

The council claimed that the said document will serve as a basis for a compromise agreement to be entered into, in the civil cases entitled National Power Corporation versus the City of Baguio, docketed as Civil Case No. 6801, filed by NPC on October 28, 2008 for the recovery of possession of real properties with damages, including back rentals, and is currently pending with the Regional Trial Court (RTC) Branch 61 of Baguio City.   

PSALM was created to take ownership of all existing generation assets, liabilities, independent power producer (IPP) contracts, real estate and all other disposable assets, among others, and to manage the orderly sale, disposition, and privatization of the said assets, with the objective of liquidating all NPC financial obligations and stranded contract cost in an optimal manner.

Earlier, Resolution No. 474, series of 2021, authorized the City Mayor representing the local government, to enter into a deed of transfer and conveyance on the property of the PSALM along Sanitary Camp where the Baguio City sewerage treatment plant is located.

The city government had been continuously negotiating with the former NPC management and the current PSALM management to strike a compromise agreement for the settlement of the long-standing case and for the city to be able to take full possession of the property where the Baguio sewage treatment plant had been constructed.

The city aims to put an end to the said case so that it will be able to acquire the title to the property as one of the basis in securing future funding support for the rehabilitation and upgrading of the city’s sewerage treatment plant to significantly increase the capacity to treat waste water before being released to the Balili River to prevent the local government from being fined for discharging waste water with high effluence to the river system.

At present, the city sewage treatment plant is currently operating at full capacity having to treat at least 12,000 cubic meters of wastewater daily compared to its treatment capacity of only 8,600 cubic meters daily, thus, the need for it to be rehabilitated and upgraded to ensure the treatment of a larger volume of waste water for better quality of wastewater.         

Under the PSALM’s strategic plan for real estate assets, the transfer of real property to another government entity shall be through direct contracting between the corporation and the counterpart government entity, subject to financial consideration to PSALM at not less than the appraised value of the property. — Dexter A. See