EXPLAINER: Councilors didn't know Carbon market will be torn down, moved to Freedom Park, which confirms they didn't read JVA before approval. Megawide grants 9 of 10 vendor issues.

Pachico A. Seares
·7 min read

CEBU City Councilor Eugenio Gabuya did not know that Units 1, 2 and 3 of the existing Carbon Market will be demolished and replaced with commercial hubs of Megawide Construction Corp., the developer that committed P5.5 billion to "modernize" the market.

He was clueless about the change until he asked Megawide during a special session of the City Council last Monday, March 15. This fact took time to sink in: the old Carbon would no longer be where they stand now. They would be replaced with other Megawide commercial buildings. Vendors will be moved to a new structure at the Freedom Park and Warwick Barracks area.

Another "stunning" disclosure was that the entire population of sitio Bato -- about 700 families -- in Barangay Ermita would lose their homes and the affected residents and their barangay captain, Mark Miral, still don't know where they would be relocated.

Apparently, the city councilors other than Gabuya also didn't know most of the basic provisions of the joint venture agreement (JVA) that the local Sanggunian last January 6 approved and authorized the mayor to sign. Mayor Edgardo Labella and Megawide sealed the contract last January 11.

DELAYED CONSULTATION. Why was the City Council holding a consultation with representatives of Megawide and the Carbon Market vendors nine weeks after the JVA was perfected and sealed on January 11 and two days before project ground-breaking was scheduled for March 17?

The reasons: The City Council approved the JVA without reading and thoroughly discussing the terms of the contract. And the vendors are now grumbling and complaining about some of its provisions.

In an "I-told-you-so" pitch, Vice Mayor Mike Rama recalled that last January 6, before the vote on Megawide project, he asked each councilor if they had read the 75-page document. Most, if not all, said they had not the document or they read "only some of it," which meant "no." Even Rama listed the "adverse" terms in the contract and the document they needed to decide "wisely." Yet they approved, 10-8, the JVA largely because, SunStar learned then, "the signing was already scheduled." (Read the January 11, 2021 Explainer.)

https://www.sunstar.com.ph/article/1882443/Cebu/Local-News/EXPLAINER-Almost-all-the-councilors-hadnt-read-the-75-page-contract-VM-Rama-listed-adverse-terms-and-needed-documents-Still-City-Council-voted-10-8-for-Megawide-Cebu-City-joint-venture-on-Carbon-market

"MAO NANG NIABOT TA ANI." We've reached this point, Rama said, this after-the-fact clarification and explanation. The special session resulted in twin moves by the Sanggunian, in a resolution proposed by Minority Floorleader Noel Archival and Councilor Eugenio Gabuya:

[1] Requesting the mayor to postpone the groundbreaking ceremony, scheduled for Wednesday, March 17, until a number of issues are clarified and addressed.

[2] Asking the city's Cultural and Historical Affairs Commission (CHAC) to look into the "conversion" of Carbon Market from being a "heritage site."

Councilor Alvin Dizon cited the need "to continue the genuine dialogue" between the vendors groups and the developer "in a spirit of participatory governance." He told SunStar he doesn't think the JVA can be amended "given the current balance of power" in the City Council. Another elective local official who did not wish to be named said it is "rather too late in the day" to amend the JVA since it involves a contractual obligation to a third party whose rights are affected by it. The city "can only appeal to the good nature and sense of fairness" of Megawide, he said.

MEGAWIDE 'STILL OPEN.' Rama believed however it was not too late to make "amendments, addenda, adjustments." He did not explain how that could be done if Megawide would not agree to the changes. But he called them "curative" measures.

Representatives of the developer told the City Council, with representatives of vendors associations taking part in the virtual public consultation, that Megawide was still open to proposals ("nothing is final"), particularly on the amendments they would proposed in the Market Code.

Megawide said it granted nine out of 10 proposals the vendors submitted in a position paper.

THREE ISSUES. Most lengthily discussed were these questions:

[1] Would any of the present vendors be shut out of the market? Megawide plans to have 3,400 stalls for the present number of 5,946 vendors. Megawide said yes, the mayor's promise not to leave any vendor out will be honored. Facilities will be enough because almost half of the vendors are ambulant or sell only two to three days a week.

[2] Would the market fees not go up and thus remove the attraction of low prices in Carbon to buyers? No increase of rental, says Megawide, not for three years. Whether it's counted from date of JVA or from date of transfer to new market was not specified.

[3] Who would run Carbon Market? Megawide says the city would still be in charge of operations of the market and formulate its policies through the Market Code. The vendors and some councilors did not think the JVA assures that function.

SOBERING NOTE. A note of moderation was sounded by Councilor Joel Garanera, who said: People are resistant to change but could adapt to it when they see or realize the improvement; Carbon Market is not just for vendors but for everyone who can be served by it; and it would be a no-brainer for the developers, including the City Government, to keep the market prices low, which is its principal come-on.

Vendors' representatives also harped on the low prices as main attraction of Carbon. We don't need a world-class market for Carbon, one said, because it serves the poor and the middle-class families. The rich already have a lot of places where to buy their food. Garganera said most countries where tourists flock have a public market and Carbon can be that market for us.

Also apparent but not defined well enough was that Carbon is only part of the project although it has caused most of the controversy.

WHAT MEGAWIDE DOESN'T GRANT. Megawide said no to one out of 10 concerns of the vendors groups. And that is: the ground floor of the new market would not be occupied by the present vendors, who are assigned to the upper floor.

Apparently, Megawide would use it for other commercial purposes.

Its representative didn't go beyond saying the "master plan" dictated it. Understandably, the vendors would like the ground floor for easier access by customers while Megawide wants same area for its location value.

A vendors group representative, Maria Pino, said that what they fear most is the transfer of management of market operations to Megawide. It was not made clear how the Market Authority's work in Carbon would be re-defined by the Megawide operation. The statement by one Megawide representative that the City Government shall turn over proceeds from market fees to the developer indicates only one aspect. What functions will the Market Authority keep other than collecting fees?

'PUZZLING' PROVISION. Erwin Guk-ong, president of a vendors’ cooperative at Carbon, along with Pino, was baffled by a provision in an annex to the JVA that the City Government can be made to compensate Megawide if the City Council fails to approve amended rates and other provisions in the Market Code, through its fixed share in revenue and other means.

They did not tell us the rate until the JVA would be finalized and signed, Guk-ong said, and now we face this provision with which they threaten the City to pass their desired amendments to the Market Code or the city pays if they don't get what they want.

Apparently though, Megawide is still willing to change the market fees in the JVA annex, as in fact it has done by adopting the no-increase-in-three-years policy. The provision on compensatory damage just gives it larger bargaining power on legislation.

That and other unclear issues could be part of the "continuing dialogue" that Councilor Dizon and other councilors are pushing.

MERE REQUEST. Meanwhile, even as the controversy heats up, the councilors were not upbeat about the ground-breaking rites being put off.

It's just a request, said Archival. Things about the project would still come back to us, said Rama. "But next time you better read (the legislation you pass)."