DENR voids contract with Masungi developer over irregularities

By Marita Moaje, Philippine News Agency

FILE: A web-style viewing platform of Masungi Georeserve with a spectacular view of Laguna de Bay – the biggest lake in the Philippines. (Photo by Jtepace/Wikimedia Commons, CC BY-SA 4.0)

MANILA – The Department of Environment and Natural Resources (DENR) has canceled its agreement with the developer of Masungi Georeserve due to irregularities in a government housing project.

In a press briefing at the DENR main office in Quezon City on Friday, Assistant Secretary for Legal Affairs Norlito Eneran said the decision to cancel the agreement with Blue Star Construction Development Corporation (Blue Star) was due to the lack of a bidding process in the company’s housing project and its failure to deliver the units.

In its letter to Blue Star owner and Masungi Georeserve proponent Ben Dumaliang, the DENR announced the cancellation of the supplemental agreement due to th following reasons: lack of the required Presidential Proclamation declaring the subject matter of the contract for housing purposes; no document to prove that the proposed construction went through regular procurement or bidding process; and failure to deliver the 5,000-unit Garden Cottages housing project within five years from signing on Nov. 15, 2002.

Eneran explained that Blue Star initially signed a joint venture agreement with the DENR in 1997 for the survey, design construction, development and marketing of the Garden Cottages project on the 130-hectare government property in Tanay, Rizal.

In 2002, another agreement awarded Blue Star an additional 300 hectares despite its failure to develop the initial 130-hectare site.

“In 1997, they signed an agreement for the development of 5,000 housing units, followed by another 5,000 housing units in 2022. Total 10,000 units not delivered nor was there any record of bidding/procurement,” the DENR said.

The housing project was intended for employees of several government agencies, including the DENR, Department of Education, Department of the Interior and Local Government, Department of National Defense, Department of Transportation, and the Office of the President.

The additional government housing units covered by the 2002 supplemental sgreement were to be located in Lot 10, where the Dumaliang family also built structures and currently operates the Masungi Georeserve, a resort that charges visitors for day treks to caves, stone formations, trails and rope bridges.

“The Garden Cottages, covered by the 1997 Joint Venture Agreement and which were originally intended as housing for government employees, are now venues for weddings and pre-nuptial shoots for which the Dumaliangs also charge a fee,” the DENR said.

Eneran said that since the original joint venture agreement was never executed and no bidding process took place despite the five-year timeline, the 2002 supplemental agreement is now without basis.

Eneran added that the 2002 supplemental agreement was among the contracts investigated by the DENR special committee starting on July 2, 2019.

“Multiple investigations by different administrations have found irregularities in the awarding of Blue Star’s contracts,” he said.