DAGUPAN CITY -- Mayor Belen Fernandez said Tuesday that the city government will borrow PHP590 million for the construction of its new city hall on a donated land along the newly designated Pantal-Lucao growth center.

Fernandez refuted allegations by critics that the city is borrowing  more than PHP1 billion for the four-storey new city hall, adding that the  city council authorized her to negotiate only for a PHP590-million loan with a reputable financial institution.

Though the Bureau of Local Government Finance of the Department of Finance (DOF) has certified that Dagupan City can borrow as much as PHP886 million as computed from its approved budget next year of PHP948 million, the city is only borrowing PHP590 million, no more no less, she said.

Fernandez recalled that during the administration of former Mayor Benjamin Lim in 2004, the city of Dagupan borrowed close to PHP300 million to fund the construction of the three-storey Malimgas Public Market, when its annual budget that time was only Php345 million.       

It still has an unpaid balance of PHP45 million with PHP29 million due next year and the remaining Php16 million by the first quarter of 2019. 

Fernandez said PHP570 million will be used for the construction of the new city hall including its needed air-conditioning system, plumbing system, mechanical elevators, furniture, furnishing and other amenities.

The remaining PHP20 million of the loan amount will fund the installation of e-governance system that will modernize paper-less transactions including tax collections and other functions of the city government.

Fernandez said they will adopt the e-governance system of Milpitas, a sister city of Dagupan in California, USA, which she and other city officials studied when they visited that city sometime in September this year.

The e-governance system will link city hall with the 31 barangays of Dagupan where anybody who has business to transact with the city government,  can make use of.

Fernandez said any amount that may be left unspent from the loan will be returned to the bank. 

At least PHP25 million was also earmarked by the city from its own fund for consultancy services for the preparation of the plans and designs of the new city hall.  

Land development on the proposed location of the new city hall is expected to start shortly with a supplemental budget of PHP20 million already approved by the city council. 

Meanwhile, City Budget Officer Luz de Guzman dubbed as "fake news" or disinformation critics' claim that when the city government obtains loan from the bank, taxes will be increased  to ensure that the city government can pay its obligation.

De Guzman said the moderate increase in taxes of real properties in the city of Dagupan has just been approved by the city council this year and based on the Local Government Code, the next  increase can be implemented only after five years.  (PNA)