Valencia town in Negros Oriental is seeking the early release by the Department of Budget and Management of about P51 million that represents two quarters of royalty fees from the Energy Development Corporation.

Local officials said further delay in the release of the royalty fees, scheduled in October 2008 yet, will affect the implementation of development projects and displace many casual employees. 

As host municipality to the Southern Negros Geothermal Production Field, Valencia and three of its barangays are authorized by law to receive a share in royalty fees from EDC, formerly the Philippine National Oil Company-Energy Development Corporation.

This is also true of all other local government units that host geothermal power plants such as in Leyte, Bicol, and Mt. Apo in Mindanao.

In the past 16 years, Valencia has received its share of quarterly royalty fees on time as the PNOC-EDC, then a Government-Owned and Controlled Corporation, transferred its royalty fees directly to the host LGUs, Gonzalez said.

However, after the full privatization of EDC last year, the company now transfers royalty fees to the Department of Energy who, in turn, forwards it to the DBM as required by law. Gonzalez lamented the seemingly slow process in the release of the collectibles due to the change in remittance procedures.

In a letter to Rep. George Arnaiz (Neg. Or., 2nd District), he said that if this delay continues, it will create a big impact on the functions of the local government unit of Valencia.

EDC sources said they are updated in their payments of royalty shares for the LGUs, with the funds being transferred on time to the DOE.

They also said the burden on the release of royalty fees now lies with the government after EDC became a private firm.

Gonzalez has asked Arnaiz, chairman of the House Committee on Local Government, to make representations with the DOE and DBM to hasten the release of the royalty fees due to the host communities.

He also asked Arnaiz to raise the matter to President Gloria Macapagal-Arroyo for her intercession. He also enjoined the mayors of Kananga and Ormoc in Leyte, Tiwi in Albay, Sorsogon, Sorsogon, Manito in Albay and Kidapawan, Cotabato – all host LGUs of EDC geothermal fields – to support a position paper and lobby for the early release of their shares of royalty fees.

Meanwhile, Arnaiz on Thursday said that a meeting is scheduled next week between his committee and officials from the DOE and DBM to find an alternative solution to this problem.

Arnaiz explained that, because of the change of status of EDC from being GOCC to a private company, the royalty fees being paid to the national government has to be included in the General Appropriations Act, thus, causing a delay in their release to the host LGUs.

He also assured that he will exhaust all means to find an immediate solution to the problem of Valencia and the other host communities. If next week’s meeting fails to come up with solutions, then it is time to elevate the matter to the President, Arnaiz added.*JFP

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