LGUs seeking clearance to borrow surge in May

LOCAL GOVERNMENT UNITS (LGUs) receiving Department of Finance (DoF) certification of their borrowing capacity more than doubled in May, the Bureau of Local Government Finance (BLGF) said.

The BLGF said it issued 20 new Certificates of Net Debt Service Ceiling and Borrowing Capacity in May, against eight certificates a year earlier.

LGUs are required to obtain the certification before seeking loans from government or private lending institutions for proposed projects.

The certificates issued in May cover proposed loans of P4.04 billion, or about 31.5% of LGU borrowing capacity. A year earlier, LGUs sought clearance to borrow P1.75 billion.

Municipalities accounted for 17 of the 20 certificates issued during the month, while one certificate each was granted to a city, a province, and a barangay.

In the first five months, the BLGF issued 108 certificates covering proposed borrowing of P25.68 billion.

The certifications were issued to 77 municipalities, 12 barangays, 11 cities and eight provinces.

The largest certification issued so far this year was a P3.5-billion borrowing proposal for infrastructure projects and the procurement of equipment and vehicles in Camarines Sur.

This was followed by a P2.19-billion certification for the planned construction of a new public market and city hall extension building in Dumaguete City.

Another major project was a P1.2-billion proposal for the construction of a three-storey sports arena in Calaca City, Batangas. — Justine Irish D. Tabile