Hike in cost take a toll on City Hall project
Instead of an eight-storey new Iloilo City Hall building the city government would have to contend on building a seven-storey building after the projected cost of construction drastically increased.
Based on current project estimates the construction cost would increase from P378,987,675 to P463,883,922.
Mayor Jerry Treñas yesterday said the change on the plan was agreed upon by Vice Mayor Jed Mabilog and the entire members of the Sangguniang Panlungsod.
The chief executive indicated no interest in pushing for the original plan of eight-storey building or entertain any idea to borrow additional funds for the project.
Treñas said they will stick with the original budget for the construction of the new city hall building which is about P379 million.
The new city hall building will occupy an area of 13,000 square meters.
Big slice of the budget for the project was obtained through a loan from the Land Bank of the Philippines. They city loaned P350 million and the rest of the budget was obtained from the city's collection on the tax and penalties from Government Owned and Controlled Corporations (GOCCs).
Earlier, Pacific-Orient Consultants and Management Co. Inc, the contractor of the project, appraised the chief executive of the estimated construction cost of the eight-storey new city hall building relative to the current economic condition. The contractor also said the project completion will be delayed for five months. Originally, the contractor projected that the building will be completed on April 30, 2010.
It can be noted however that even a single construction work has not yet started on the site.
In his letter to Mayor Treñas, Conrado Goco, general manager of Pacific-Orient Consultants and Management Co. Inc, said "the increase in cost is attributed mainly to the increase in cost of fuel, which affected the cost of construction materials like rebars, cement, electrical wires, tiles, pipes and fitting and architectural materials."
In the same letter, Goco also forewarned the chief executive that the "increase in construction cost also begets increase in consultancy cost. It was not immediately known on how much is the consultancy fee for the new city hall project.