The Iloilo City government is planning to auction some of the assets of Panay Electric Co. (PECO) by next month to pay for the company’s real estate tax liabilities, which have reached P106 million, including penalties since 2006.
“Yes, that’s only for the P90 million in unpaid taxes,” Iloilo City Mayor Jerry Trenas said when asked about the planned auction.
The move is seen to solve the city government’s collection problem with PECO, which has not paid taxes in 13 years or when the City Treasurer’s Office first made the tax assessment.
PECO distributes electricity to Iloilo City through its certificate of public convenience and necessity issued by the Energy Regulatory Commission, pending the completion of the transition to the new franchise holder More Electric Power Corp. or MORE.
PECO’s franchise expired early this year, and the franchise to distribute electricity in the city was given to MORE by Congress.
The city assessed PECO’s real estate tax dues at P90 million and additional penalties since March this year.
PECO’s tax obligations arose from a new ruling from the City Treasurer’s Office (CTO) that the lot on which PECO’s electricity poles are located are also taxable real estate.
The CTO is planning to put a floor price of P106,881,685.33 as the lowest bid when it puts up for bidding PECO’s land that utilize these electricity posts.
PECO’s electric posts are valued at P214.9 million.
CTO Tax Enforcement Division chief John Ladrillo, in a radio interview, said the floor price was computed based on PECO’s total tax liability amounting to P97,164,438.81, the cost of the sale including documentary stamp taxes estimated at P9,716,443.88 and a registration fee of P802.64.
Meanwhile, Trenas balked at reports that PECO considered the recent pole fires around the city as “not a big issue.”
Trenas has asked the Office of the President and the Energy Regulatory Commission to investigate the cause of the pole fires which posed a serious hazard to the public.
The ERC has sent a technical team to Iloilo City to verify the complaint of Trenas that PECO’s aged electricity posts pose a threat to public safety.