Discaya firms ran Iloilo City flood projects without permits

By Rjay Zuriaga Castor

Two construction companies owned by the Discaya family have been carrying out multimillion-peso flood control projects in Iloilo City since 2024 despite not having a mayor’s or business permit.

The firms flagged were St. Timothy Construction Corp. and Alpha and Omega General Contractor & Development Corp., both among the country’s top implementers of flood mitigation projects.

The irregularity surfaced after Mayor Raisa Treñas-Chu directed the City Treasurer’s Office (CTO) to review more than 90 ongoing projects of the Iloilo City District Engineering Office (ICDEO) funded under the General Appropriations Act from 2022 to 2025.

CTO head Engr. Jinny Hermano reported that their review showed the two Pasig City-based companies had no valid mayor’s or business permits, a requirement for contractors to legally operate within the city.

The business permit ensures compliance with local regulations and is often accompanied by building permits, zoning clearances, and safety requirements.

As a result, the CTO has imposed more than PHP 3.1 million in taxes against the two companies, representing obligations tied to four flood projects.

Hermano explained that when a business operates within the jurisdiction of a local government unit (LGU), such as Iloilo City, it must have the authority to do business there, which means obtaining the necessary permits and paying required taxes to that LGU.

“Even if a business has its principal office in another LGU and has a valid business permit there, if it operates or conducts business activities like contracting in Iloilo City, it must still obtain a permit from Iloilo City and pay the contractor’s tax here,” he said.

Treñas-Chu said she found the situation alarming, particularly after discovering that representatives of St. Timothy Construction could not identify the actual locations of three projects already issued notices to proceed by ICDEO.

Among the projects of St. Timothy Construction is a two-section flood mitigation structure in Barangay Bo. Obrero, Lapuz district, both valued at more than PHP 142 million, with contract dates starting Feb. 26, 2024.

Alpha and Omega, meanwhile, is undertaking the construction of a PHP 145 million multipurpose building in Barangay Tacas, Jaro district, which started on June 3, 2025.

On Wednesday, the Philippine Contractors Accreditation Board (PCAB) revoked the licenses of nine construction firms owned or controlled by the Discaya family.

The move followed Sarah Discaya’s admission during a Senate Blue Ribbon Committee hearing on Monday that she owned the companies and that they participated in government project biddings, sometimes competing against each other.

PCAB said the revocation stemmed from the firms’ involvement in what it called a scheme of joint or multiple bidding designed to manipulate outcomes, undermining transparency, fairness, and competition, in violation of procurement laws and licensing requirements.

The board said it intends to forward the case to the National Bureau of Investigation and the Department of Justice for possible criminal liability.

‘SHOW ME THE PHP1B’

Treñas-Chu also demanded answers from the Department of Public Works and Highways (DPWH) on the fate of the PHP 1 billion earmarked for the city’s flood mitigation program in 2022.

In October 2022, Iloilo City Rep. Julienne “Jam-Jam” Baronda announced that she had secured nearly PHP 1 billion for the PHP 6.2 billion Comprehensive Drainage Plan.

The plan, based on a 2017 feasibility study, aims to integrate various components, including flood control stages and creek improvements.

Baronda said the funding was coursed through the General Appropriations Act with support from key lawmakers and DPWH.

The PHP 1 billion complemented the PHP 500 million previously allocated.

Two years later, however, Treñas-Chu said residents have yet to see substantial progress in flood-prone areas.

“Where is the plan, where are the projects?” the mayor asked, pointing out that while DPWH claimed PHP 1.4 billion had already been allocated, inspections revealed “little to no impact” on communities that continue to experience perennial flooding.

She also flagged the agency’s transparency reports, which lacked crucial details such as contract IDs, start dates, and target completion dates, making it difficult for the public to verify the status of projects.

Treñas-Chu called on DPWH to present a full and transparent report on all flood control projects in the city, including specific locations, timelines, budget allocations, and actual progress.

The issue comes amid sweeping reforms in DPWH after Secretary Vince Dizon suspended all local project biddings on orders of President Ferdinand Marcos Jr., who has vowed to clean up the agency.

The suspension is intended to allow a thorough review of the agency’s procurement system to stop irregularities, especially those exposed in the government’s flood control program.

“With the suspension of all local project biddings, it becomes even more urgent that Iloilo City be given clarity,” she added.