With some City Hall offices here already out of electricity after the Agusan del Norte Electric Cooperative (ANECO) ordered the utility service disconnected for what it claimed as P30 million in unsettled bills, other government offices here would likely be cut off from service this week. The ANECO management has ordered its electricians to disconnect other government offices in the city if no settlement is reached. In its May 31, 2010 letter to the Butuan City Government, the ANECO management urged City Hall to settle its obligations. ANECO general manager Horacio Santos said the cooperative already disconnected the city government's potor pool, the offices of the Department of Interior and Local Governments and Kadiwa stores, and some street lights. “Next, we will be forced to disconnect power lines in some Butuan City Government offices and we hope they will understand ANECO's predicament, because we are also obliged to pay our power bills to [National Grid Corporation of the Philippines] and [National Power Corp.] or else, if we don't collect, we will also face power disconnection this time by NGCP and Napocor,” Santos said. ANECO will, however, spare the street lights at Butuan's Rizal Park and the Butuan City Medical Center where hundreds of patients are confined, Santos said. The city government said it will settle the unpaid electric bills Monday, June 7, to avoid further disconnections. According to outgoing Butuan City Vice Mayor Dino Sanchez, City Treasurer Adolfo Llagas already talked to ANECO officials about the problem and that arrangements for an initial payment were already made. Santos claimed ANECO called on the attention of the city government under the administration of Mayor Democrito Diayon Plaza “since a long time ago,” but Butuan failed to settle its electricity bills because of a dispute with the power cooperative on payments of the gross tax. ANECO initially settled its gross tax with the City Treasurer's Office, but not anymore. “This is because, under the law, power cooperatives being non-profit, non-business entities are only obliged to pay power distribution system taxes,” according to Santos. The city government was insisting that ANECO owed it some P10 million in gross taxes and other back taxes, Santos said. Santos claimed the Department of Finance issued a memorandum last March that ANECO, as a power cooperative and being a non-profit, service-oriented entity, must only pay for the power distribution system tax. “What we want now is just to follow the correct process, and that is to pay only the distribution charges, because ANECO is only a power distribution cooperative not generation or transmission,” Santos said.
