Polytechnic University of the Philippines

"PUP is legally-bound to honor GSIS condotel-hostel deal" - President De Guzman

Communication Management Office, Media Release, Polytechnic University of the Philippines

The Polytechnic University of the Philippines (PUP) is legally-bound to pay P1.6 million monthly for the P575.7 million-contract with the Government Service and Insurance System (GSIS) of the previous administration under Dr. Dante Guevarra.

This was the statement of PUP President Dr. Emanuel C. De Guzman regarding the two 10-year old five-story GSIS condotel-hostel buildings the University bought in 2007. This after the Commission on Audit (COA) reported that government funds were wasted when it bought these two ‘dilapidated buildings’.

“We cannot turn our back on this PUP-GSIS condotel-hostel deal since we will be charged of breached of contract and sued in court. The then Board of Regents (BOR), which is the highest policy-making body of PUP, approved the contract in 2007 which the present BOR has to honor and comply with,” President De Guzman said.

President De Guzman started his term of office on March 14, 2012.

As of Dec 31, 2012, PUP has paid GSIS a total of 91.4 million from March 2008, leaving a balance of P491.6 million over 25 years. The University has also spent 101.2 million for the rehabilitation of Building A of the condotel-hostel.

New Administration’s Move

President De Guzman also registered that PUP will ask for the intervention of the Aquino government to look into the details of the contract.

“While PUP wishes to be relieved with the financial burden of paying for the GSIS condotel-hostel in 25 years, what we want to ask the Aquino government through the GSIS is to considerably lower our monthly payment and reduce the remaining balance of the deal in any way possible and within the legal parameters,” President De Guzman said.

President De Guzman also admitted that because of insufficient subsidy from the national government and no available resources to undertake the rehabilitation of the two buildings, the University is now seriously considering the option of entering into a public-private partnership such as the Rehabilitate-Operate-and-Transfer scheme authorized under Republic Act 6957 as amended by Republic Act 7718. He added that a feasibility study is being undertaken for the purpose, prior to obtaining all the necessary approvals, including the required concurrence of the GSIS.

“Upon the diligent pursuance of the plans for both buildings, we are optimistic that the purposes for which the structures were acquired will come to full realization and will likewise alleviate in the process, the financial obligation of the University to GSIS,” he explained.

The rehabilitation of Building A, undertaken in three phases, was completed in May 2010. The College of Technology (now Institute of Technology) and the College of Engineering (COE) have been utilizing several rooms in Building A as classrooms in view of the constantly increasing numbers of students in the said institute and college. This school year 2013-2014, more classrooms in the said building will be used by the Institute of Technology, College of Engineering and the College of Architecture and Fine Arts. Five commercial spaces in Building A have been earmarked and advertised for lease in order to serve the purpose of augmenting the resource generation activities of PUP.