SHOULD the Cebu City Government dream high or aim for the achievable?
This was the central discussion yesterday during the first budget hearing where members of the local finance committee met with the Council.
City Treasurer Emma Villarete admitted that the City will not meet the P386-million estimated revenue from real property taxes this year.
During the cutoff last Oct. 31, the City collected only P280 million, with an estimated P50 to P60 million more until the end of the year. There will still be an expected shortfall of about P50 million.
Despite that, the local finance committee projected it can collect P560 million from real property taxes in 2013.
?Let?s be realistic,? said Councilor Noel Wenceslao, who also asked for a historical data on the annual increase in real property tax collections. It turns out that the growth rate is only five percent per year, but the 2013 project presents a 45 percent increase.
Villarete explained that the collection is based on the assessment of real property made by the City Assessor?s Office. City Assessor Eustaquio Cesa affirmed the amount.
Cesa said there are new buildings assessed every year and this year, a number of buildings were completed at the IT Park in Lahug.
Councilor Jose Daluz, though, said budgeting is about expenditure and not about the estimates, so the City should ?aim high.?
?We can have a high target because budget is about expenditure. We can just temper the expenditures,? said Daluz.
Councilor Margarita Osme?a said she is confused why the local finance committee has high estimates for some revenue sources and low for others.
One example of the latter is in other local taxes, like business taxes, community tax certificates, professional and occupational taxes, amusement taxes and transfer certificates. From these, the committee projected to reach P900 million this year.
However, actual collection as of Oct. 31 has reached P928 million, three percentage points above the target for this year.
With the start of tax mapping implemented by the City Treasurer?s Office, the City is
expected to collect over a billion by the end of the year.
In the proposed budget, the committee projected to collect P1.2 billion from other local taxes.
The City also overshot collection targets in license fees, collecting P141 million so far this year, from the P100 million proposal. For next year, the local finance committee projected to collect P150 million.
Another shortfall for the City is in its business and service income, which includes collections from clearances and certifications; garbage, medical, dental, laboratory, and terminal fees, among others.
While the City estimated to collect P350 million this year, only P132 was collected.
The committee also projected to raise P450 million from the same revenue source next
year.
?Why are you conservative in some but bold in others?? asked Osme?a about the projections of the committee.
?In the executive, we have our own definition of conservative. While we have a target, there are things that we still need to achieve so we need Council support. Before we came here we also did our homework, which the estimate is based on,? said City Administrator Jose Mari Poblete.
It is no secret that the executive and legislative have not seen eye-to-eye since Mayor Michael Rama bolted from the Bando Osme?a Pundok Kauswagan (BOPK) group of Rep. Tomas Osme?a, which dominates the Council.
Councilor Osme?a agreed that the executive and legislative should work together, but lamented that in many cases, the Council has not been included in consultations.
She said this happened when the executive conducted a series of activities with multi-sectoral representatives to craft ?the people?s budget?.
The budget hearing adjourned at 4 p.m. and will resume on Monday at 1 p.m., still with the local finance committee defending the sources of funds for the P6.7-billion proposed 2013 budget.
Villarete was directed to bring documents to support the revenue sources including comparative collection of the City Government in the past five years.
Published in the Sun.Star Cebu newspaper on November 24, 2012.
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