The Office of the Ombudsman has indicted former Transportation secretary Joseph Emilio Abaya for graft over the anomalous P4.2-billion maintenance contract of the Metro Rail Transit Line 3.
Included in the charges were former undersecretaries Edwin Lopez; Rene Limcaoco, head of the negotiating team; Catherine Jennifer Francis Gonzales, vice head of the negotiating team; former MRT3 general manager Roman Buenafe; Camille Alcaraz, assistant secretary for procurement; Ofelia Astrera, vice chairperson of the MRT 3 bids and awards committee; Charissa Eloisa Julia Opulencia, attorney 5; Oscar Bongon, chief of the engineering division, and Jose Rodante Sabayle, engineer 3.
Private respondents Eldonn Ferdinand Uy of Edison Development and Construction, Elizabeth Velasco of Tramat Mercantile Inc., Belinda Tan of TMI Corp. Inc., Brian Velasco of Castan Corp., and Antonio Borromeo, Jun Ho Hwang and Elpidio Uy from Busan Universal Rail Inc. were also included in the indictment.
After failed biddings for the MRT 3 maintenance service contract in October 2014 and January 2015, Abaya issued a special order creating the MRT 3 bids and awards committee, which later recommended a negotiated procurement allowed by law in emergencies.
In October, three joint ventures—including Busan Joint Venture—submitted their proposals, but all were found to be deficient and given the opportunity to correct their defects.
On Oct. 23, 2015, the negotiating team declared Busan as the sole entity that passed the eligibility on technical and financial documents and recommended the BAC award the contract to the joint venture.
The BAC did so on Dec. 21, 2015, and the Transportation Department, MRT 3 and Busan entered into a contract for the long-term maintenance contract.
But the Commission on Audit found in its 2016 annual report that the Transportation Department “failed to provide the riding public with a safe and comfortable transport system even with the procurement and delivery from August 2015 to January 2017 of 48 new LRVs (light rail vehicles) with a total cost of PHP3,759,382,400.”
A special panel of probers found that the respondents extended unwarranted benefits, advantage and preference to the contractor when it awarded the project to Busan JV, an ineligible and unqualified entity.
In its 88-page consolidated resolution, the Ombudsman said “as the Busan JV’s offer was still considered as successful, the potential JV partners must enter into a Joint Venture Agreement in accordance with its rules. But they did not. Still, the Busan JV was awarded the contract—yet another violation of the rules under R.A. No. 9184.”
Procurement documents showed that it was only Eldonn Uy of Edison Development and Construction that executed a “Statement to Enter Into a Joint Venture” purportedly as the authorized representative of all the members of the Busan JV.
“Since only one potential partner of the Busan JV submitted the required statement, it should have been disqualified from participating further in the negotiated procurement since it lacked an eligibility requirement,” the Ombudsman added.
The special panel also found an irregularity in the award when Busan JV was allowed to simply submit a Certificate of Registration of BURI as a Special Purpose Co. instead of a valid JVA.
The action becomes even more suspect as it was Alcaraz who wrote the Securities and Exchange Commission to facilitate the registration of Busan JV as an SPC.
“This office notes that [Alcaraz] was the DOTr assistant secretary for procurement and the chairperson of the MRT 3 BAC. Her action thus reeks of impropriety as it gives the impression that she was acting in favor of the Busan JV,” the Ombudsman said.
The special panel also cited irregularities in the amendment of the original net worth requirement and absence of Bill of Quantities, which favored Busan JV.
Based on their 2014 audited financial statements of members of the Busan JV, the net worth of Tramat in 2014 was only P1.9 million while Edison’s was P383.5 million only, both below the P1 billion required.
In its financial offer, Busan JV failed to include its BOQ as required.
“There are no existing BOQs for the overhauling of the 43 LRVs and the total replacement signaling system components of the MRT 3 long-term maintenance contract. Having failed to submit the required BOQ, the Busan JV should have been disqualified outright from the procurement process,” the Ombudsman said.
The Ombudsman said Busan JV was not technically, legally and financially capable to undertake the MRT 3 long-term maintenance contract.
Despite its being unqualified, Busan JV was still awarded the contract, in violation of Section 53 of the RIRR of R.A. No. 9184, which requires that in a negotiated procurement, the procuring entity should negotiate with a technically, legally and financially capable supplier, contractor or consultant.
The Ombudsman added that as Transportation secretary, Abaya had supervision and control over the officials under him and was immediately and primarily responsible for all government funds and property pertaining to his agency at the time of the questioned transaction.
“By allowing the award of the contract to the Busan JV despite the attendant glaring irregularities, Abaya deliberately ignored applicable laws, rules and regulations, and standard operating procedures, falling short of or disregarding the required competence expected of him in the performance of his official functions,” it added.
Senator Grace Poe, chairman of the Senate committee on public services that investigated the MRT3 mess, welcomed the filing of charges.
“This announcement is consistent with the conclusion of the committee report submitted by the subcommittee on public services, which observed the badges of negligence and inactions of the DOTR officials led by Abaya indicating insensitivity, callous indifference, and acts disadvantageous to the commuters, to the Filipino public and to the government with regard to the malfunction problem of the MRT,” Poe said in a statement.
“These cases are a reminder to everyone that graft is a serious offense. While we lament that the same is bailable, let this be a lesson to everyone in government that public officers are accountable for each and every contract that they enter into on behalf of the Filipino people,” she added.
In the House, Puwersa ng Bayaning Atleta Party-list Rep. Jericho Nograles said the Ombudsman was correct in its decision to indict the people behind the anomalous contract, but may have underappreciated the gravity of the crime when it filed graft and corruption charges against them instead of plunder, for which there is no bail. With Maricel V. Cruz and PNA