What Has He Done?

Arnel Casanova’s highly-publicized disputes not only with CJHDevCo but also with other private developers, such as SM Land Inc. in BGC, have long spooked the business community and dampened investor confidence in PPP projects and other big-ticket joint ventures with the government, despite the successive credit upgrades of the Philippine economy as Asia’s new growth haven.

Maltreating BCDA’s private partners and its other stakeholders may be partly in Casanova’s DNA, judging from his warlike behavior towards CJHDevCo, SMLI and even seemingly harmless active and retired military officers residing in a portion of the former Fort Bonifacio army camp at BGC.

All parties lost in the battle between BCDA and CJHDevco but unfortunately the casualty here was Baguio as the biggest loser in the dispute that dragged for years.

BCDA lost a lot of money with the P1.42 award to CJHDevCo and the P3.3 billion “back rent” or P4.72 billion. They also lost because the legacy of a vision that is their project within the 256 hectare property could not be realized now.

Baguio remains to be the biggest loser not only in terms of money but also potential for more taxes, more jobs for the people and the economy generated which could be exponential with their presence.

Casanova’s claim of personal victory on the Camp John Hay issue comical. Apparently, his clients lost:

(1) The AFP–because it undermines the AFP modernization program;

(2) The Government–particularly its privatization program for military facilities, as BCDA’s plan to prematurely take over the CJHSEZ can only be interpreted as reverse privatization; (3) Baguio City because the PDRCI took away Baguio’s 25% share of all BCDA rentals as host-city of the CJHSEZ.

Baguio City Mayor Mauricio Domogan told reporters that, as soon as the PDRCI order becomes final, the city will no longer collect any share of CJHSEZ rentals.

The city government, he said, used this money to bankroll local projects that cannot be funded by Baguio’s P412-million Internal Revenue Allotment (IRA) share from the national government.

Councilor Peter Fianza, who was Baguio’s City Administrator during the terms of former Mayors Braulio Yaranon and Reinaldo Bautista Jr., says that the PDRCI-ordered return of CJH to the BCDA will be a severe blow to the local economy. The city government supported the original BCDA-CJHDevco lease agreement on condition that the city would get either a 25% share of all rentals or 30% of net income, whichever was higher.

City Hall mortgaged the Baguio Convention Center against its share of rentals that the BCDA was supposed to collect from CJHDevCo. The City was forced to pay the balance after GSIS threatened to take back the BCC after the feud between the CJHSEZ lessor and its lessee escalated in 2011.

The PDRCI decision is not a victory for the BCDA because the PDRCI vindicates CJHDevCo’s long-held argument that the BCDA has been a serial violator of the 1996 MOA and the subsequent RMOAs.

Such transgressions were acts of bad faith on the part of Casanova, that started right from the very start of the lease agreement in 1996 when the lessor failed to turn over at least 32 hectares covered by the original MOA despite the lessee’s payment in advance of P250 million upon signing of the contract and another P425 million in rentals a year later.