By MARK FRANCISCO
THROUGH a resolution, the City Council of Cagayan de Oro urged regulator Local Water Utilities Administration (LWUA) to adopt the opinion it had sought itself from the Department of Justice (DOJ) regarding its full intervention to the affairs of the Cagayan de Oro Water District (COWD).
In a seven-page document dated June 18, Justice Undersecretary Raul Vasquez opined that a utility’s failure to meet its obligations in the financial assistance contract inked with the regulatory body could only be considered a default if either the principal amount or interest is involved.
LWUA since 1973 has been financing water supply projects through funds secured from national government subscriptions, bilateral and multilateral fund sources, internally-generated funds, second generation funds and government and private financing institutions.
LWUA then allocates and re-lends these funds to water districts at competitive terms in the form of financial assistance contracts.
Through their own board resolution dated May 17, LWUA had already announced that COWD had incurred various violations in their financial assistance contract that collectively are tantamount to a default.
But COWD had challenged this, stating that they had not remiss in its financial assistance contract obligations and in fact already paid P600,000 advance in the past month.
Thus, LWUA sought DOJ’s comment on the matter.
With the release of the DOJ opinion, the councilors passed the resolution during their weekly plenary urging LWUA to adopt it by recalling the appointment of interim directors and general manager of COWD which had governed the utility since May in a period of six months.
A copy of the resolution would be forwarded to LWUA for their consideration.
The appointment of the interim officials is also currently being challenged in court by the persons who were set aside.
