NEA orders dismissal of Zamcelco general manager, board members PDF Print E-mail
Wednesday, 15 June 2011 16:47

After an exhaustive investigation, the National Electrification Administration (NEA) Board of Administrators has found the management and board of directors of the Zamboanga City Electric Cooperative (ZAMCELCO) guilty of repeated violation and non-compliance of NEA issuances and regulations and imposed the penalty of removal including forfeiture of retirement benefits of the general manager.

The NEA decision is based on the motu propio investigation of Zamcelco Inc. arising from the adverse NEA audit findings covering the period Sept. 1, 2009 to June 30, 2010.

Those affected by the NEA dismissal order are GeneralManager Reinerio Ramos, Board members Rolando Gregorio, Tito Espiritusanto, Leomir Toribio, Aida Loong. Ronald Maravilla, Emias Alviar and outgoing Directors Alexis Ortega and Noel Tarrazona.

In an 8-page decision issued May 25, 2011 and furnished to Mayor Celso Lobregat yesterday, the NEA Board of Administrators also stated that “as a necessary consequence of the penalty of removal, pursuant to section 3, rule VII of the Rules of Procedure of the NEA, the said respondents—Zamcelco management and board (in office from Sept. 1, 2009 to June 30, 2010) are perpetually disqualified from holding office in any rural electric cooperative.”
The decision is signed by Jose Rene Almendras, Energy Secretary and NEA  and chairman, member Jose Victor Lobrigo, member Wilbert Billena, member Joseph
Khonghun and Edita Bueno, ex-officio member and administrator.

Citing the NEA decision, Mayor Lobregat in a press briefing yesterday afternoon said the decision takes effect immediately and that Engr. Jesus Castro, the designated project supervisor, is also named as acting general manager (PS/AGM) in view of the removal of the cooperative’s key officials. 

He was informed, he said, that the NEA will appoint members of the board to sit in an acting capacity, in order to obtain a quorum during meetings and other important forums. With the NEA penalty of removal, the only elected members  left in the board are Efren Perez, Bong Atilano and Jun Graciano along with the consumer representative Engr. Sonny Navarro. 

However, the city government will be consulted on the appointment of the board of directors, the mayor stressed.
Docketed as NEA Administrative Case No. 02-12-10, the case has the Multi-sectoral Movement for a Better Zamcelco (MBZ) as intervenors.

Mayor Lobregat, it is recalled, several months ago has requested the NEA to investigate Zamcelco following mounting complaints of alleged anomalous transactions.
The mayor’s request resulted to the NEA’s comprehensive audit report that caused the Zamcelco management and board to come up with justifications.

However, upon evaluation of the Zamcelco management’s justification on the comprehensive audit report covering the said period, the electric cooperative audit
department (ECAD) found 7 audit findings as not fully substantiated. These include the acquisition , through negotiated purchase of a 10MVA substation in the amount of P33million (the 2010 NEA price indez for a 10MVA substation is P24.46million; acquisition of 34 units KIA vehicles (20 in 2009 and 14 in 2010), ten of which are luxury vehicles; Zamcelco was penalized by the Energy Regulatory Commission (ERC) the amount of P129,900 in May 2010 for implementing CAPEX projects without ERC approval; Talon-talon lot acquired at P2,500 per square meter for a total amount of P2.5 million; love fund drive for board officials and ex-officio (GM) of P20,000 each per board resolution 368-09 DATED November 21, 2009; light and sound band equipment acquired from Park 88 in the amount of P1.2million and very weak internal control system particularly releases of materials to area offices.

Since the justifications made by the Zamcelco management were found insufficient, the ECAD director recommended to the NEA administrator the conduct by the AdCom of a motu propio investigation on the said electric cooperative that resulted to the May 25, 2011 decision.

The probe findings centered on the acquisition of the KIA vehicles, whereby, after thorough study of documentary evidences, the NEA said that the “act of Zamcelco in procuring 14 units on January 25, 2010 even if the 2010 workplan, where said vehicles were included is yet to be approved by NEA, also constitutes violation/non-compliance to NEA issuances, memoranda and other rules and regulations under Sec. 1 (a)(6), Rule VII of the NEA Adcoom rules of procedure.”

“Violation/non-compliance to NEA issuances, memoranda and other rules and regulations carry with it the penalty of suspension for 31-90 days, for first infraction thereof. A repeated commission of the same offense warrants the imposition of the supreme penalty of removal on account of the seeming disregard of the tenor of the NEA’s letters relative to the purchase of the said KIA vehicles”, the findings state.

Aside from Mayor Lobregat, copies of the NEA decision were furnished to the MBZ counsels  Carl Andrew Rubio, Juan Climaco Elago and Florencio Liong and Atty. Elpidio Nuval, counsel for respondents. — Sheila Covarrubias