report 2018 · 2019. 10. 14. · sapat na daloy ng tubig; serbisyong tunay community vision for its...

ANNUAL REPORT2018

METROPOLITAN WATERWORKS AND SEWERAGE SYSTEM

Trunk Line : 920-55-21 local Nos. 102 & 103Direct Line : (02)433-39-87

E-mail: [email protected]

1. History, Vision and Mission Statement ........................................................................................ 5

2. Introduction ........................................................................................................................................... 6

3. Message from the Administrator ...................................................................................................7

4. MWSS Board of Trustees Accomplishments .............................................................................. 8

5. The MWSS Raw Water Conveyance System ............................................................................12

6. 2018 Water Security Infrastructure Priorities ..........................................................................13

7. Water Resource and Infrastructure Development ..................................................................15

a. Bulacan Bulk Water Supply Project (BBWSP) ........................................................................................16

b. New Centennial Water Supply Project- Kaliwa Dam Project (NCWSP-KDP) .................18

c. Rehabilitation of AHEPP ........................................................................................................................................ 20

d. Sumag River Diversion Project..........................................................................................................................22

e. Ipo Dam 3 Project ....................................................................................................................................................... 23

8. Water Distribution Efficiency.........................................................................................................24

a. Angat Water Transmission Improvement Project (AWTIP) ...................................................... 25

b. Umiray-Angat Transbasin Tunnel Facilities Rehabilitation ........................................................... 26

c. Aqueduct No. 7 (AQ-7) ...........................................................................................................................................28

d. Tunnel No. 5 Project ..................................................................................................................................................29

9. Sewerage and Sanitation ............................................................................................................. 30

10. Water Rates and Review Rationalization ................................................................................. 37

11. Organizational Excellence ..............................................................................................................39

a. MWSS’ Information Systems Strategic Plan (ISSP) in 2018 ...................................................... 40

b. 2018 Performance Evaluation Scorecard (PES): Another Year of Growth and

Improved Operating Performance ................................................................................................................ 42

c. MWSS targets ISO9001:2015 Certification for the Project Management Team ....... 44

d. Trainings Conducted .................................................................................................................................................48

i. Gender Equity in Mainstream of MWSS’ Operations

ANNUAL REPORT 2018TABLE OF CONTENTS

ii. MWSS Managers and Supervisors Receive Orientation on 2017 ORAOHRA

iii. MWSS Employees Undergo Workshop on Coaching

iv. MWSS Raises the Bar In Effective Leadership

e. MWSS Employee Bong Agluba Receives CSC’s PAG-ASA Award ........................................ 53

f. MWSS’ Gift Giving Tradition to Dumagats Continues ..................................................................... 54

g. Successful Implementation of CNA .............................................................................................................. 55

h. Implementation of the ERIP and Reorganization ................................................................................57

12. Partnership Development ..............................................................................................................58

a. A Million Tree Challenge Program in 2018 ................................................................................................ 59

b. MWSS Participates in Manila Bay Rehabilitation Program ...........................................................61

c. Carriedo Cup Sportsfest 2018 ....................................................................................................................... 63

d. MWSS Receives Certificate of Collaboration from the Office of the Cabinet

Secretary (Office of the President of the Philippines)Hotline .................................................67

e. MWSS Joins Annual R.A.C.E to Serve Fun Run 2018 .....................................................................68

f. MWSS Donates Furniture to Elementary and High Schools ....................................................69

g. Patubig sa Albay: Mobile Water Treatment Plant Assistance .................................................70

13. Communication and Knowledge ................................................................................................... 71

14. Management ....................................................................................................................................... 71

a. MWSS Holds First- Ever Cultural Sensitivity Training with NCIP ..............................................72

15. Financial Report ................................................................................................................................ 73

ANNUAL REPORT 2018TABLE OF CONTENTS

On 19 June 1971, Republic Act 6234 was enacted. It dissolved the National Waterworks and Sewerage System (NAWASA) and created in its place the Metropolitan Waterworks and Sewerage System (MWSS). MWSS was thus given the mandate to ensure an uninterrupted and adequate supply and distribution of potable water at just and equitable rates in its service area in Metro Manila, the province of Rizal and adjoining cities and municipalities in Cavite province. The proper operation and maintenance of sewerage systems is likewise part of its mandate.

As a result of the National water Crisis Act of 1995 in 1997, the operation of MWSS was privatized through public bidding after government realized that the private sector is better equipped and suited to continue its operations given the conditions prevailing during that time. Manila Water Corporation, Inc. or MWCI and Maynilad Water Services Inc., or MWSI, separately won the bid for their respective service areas for an initial 25-year concession period which was later extended to another 15 years.

HISTORY

By 2024, MWSS-CO shall be a world – class benchmarked agency for its water security program with technically competent personnel and infrastructure

VISION

Malinis na Tubig; Walang Korupsyon; Sapat na Daloy ng Tubig; Serbisyong Tunay

COMMUNITY VISION

For its customers in Metro Manila and expansion areas:

Optimize and expand our water sources and secure their watersheds and facilities

Provide equitable access to clean, potable and affordable water

Expand the coverage of sewerage and sanitation services

Ensure prudence and efficiency in the implementation of all our plans

MISSION

CORE VALUESS – Service ExcellenceQu – QualityI – IntegrityR – Results-OrientedT – Transparency

MWSS ANNUAL REPORT 2018 | 5

The year 2018 was a turning point for the MWSS as the new administration’s sound development momentum propelled the rapid implementation of infrastructure projects alongside the implementation of MWSS reorganization.

Despite intensified efforts to accelerate the construction of major technological infrastructure, provide fiscal discipline, create an environment conducive to innovation, it has been a very fruitful year which can be visibly seen and felt.

The 2018 Annual Report will give you a perspective of what has transpired during the process of negotiation and construction for MWSS’ Infrastructure developments such as AWTIP, BBWSP and the NCWS-KDP as the core projects of the agency. Also included are projects such as Sumag Diversion Project, Rehabilitation of Auxiliary Turbine Nos. 4 & 5 (ROM of AN 4 and 5 ), Rehabilitation of UATP and the introduction of the newly proposed projects such as Ipo Dam 3, Aqueduct No. 7 and Tunnel No. 5.

Moreover, the continuous preparation for Disaster Resilience Measures, the approval of the Information Systems Plan, groundworks for ISO certification of the Project Management Office, ecological programs such as A Million Tree Challenge (AMTC) program for sustainable watershed management, employees’ productivity trainings and long-term partnership development were the primary drivers of growth for the MWSS-CO.

At the end of this report, MWSS is proud to report to the people of Metro Manila that the agency has been steadfast in its purpose to become one of the best guardians of water resource and the environment.

INTRODUCTION

6 | MWSS ANNUAL REPORT 2018

In this year’s review, we present an account of how the Corporate Office set bold but imperative targets in the face of transformation and laid the important foundations for further growth. This annual report is more than just a celebration of our strong and consistent performance which is reflected in our key performance indicators. It is a testament to all the efforts of those who have played a part in our ongoing journey towards continuous improvement.

In 2018, the MWSS welcomed new opportunities for advancement as we launched the Water Eco-Tourism Hub Master Plan to bring in new avenues for growth and revenues. Our strong relationship with our business and strategic partners was affirmed when we launched the Annual Million Tree Challenge where pledges exceeded actual trees planted, protected and nurtured. We also celebrated the opening of the modern canteen and multi-purpose gym, which made the workplace for employees and tenants a more interesting and desirable place to be. The greatest indication of the success of last year is the trust placed upon the agency, as manifested by the glut of interest from the private sector -- from assistance for medium to long-term water source development, innovative technologies, to joint ventures and property development opportunities. An icing on the cake is the interrelated objectives and good work relationship with our three (3) concessionaires.

We look back to those who have played a part in our journey towards sustainability as we bade goodbye to the 25 employees who retired under the early retirement and incentive plan. The 70 who remained in the service to deliver a sustainable Corporate Office, stand to serve as a useful reminder that we have to continue as stewards of an agency that has existed through multiple lifetimes and must all remain as committed as ever to ensuring that the MWSS continues to grow and evolve for multiple generations yet to come.

My deepest thanks to the Management and staff for their leadership and drive to secure our future together.

With the guidance of the Board, I am looking forward to new ways of working, trying incipient ideas, striving to accomplish more, and doing even better than what we have previously achieved.

MESSAGE FROM THE ADMINISTRATOR


As the highest policy making body, and line with the As the highest policy making body, and line with the MWSS’ mandate of “ensuring an uninterrupted and adequate supply and distribution of potable water for domestic and other purposes and the proper operation and maintenance of sewerage systems in its service area”, the Board of Trustees (BOT), headed by its Chairman, Franklin J. Demonteverde, continued to carry out in a transparent, responsible, accountable manner, and with utmost degree of professional ways to improve the MWSS-CO.

In 2018, the Board, strengthened the corporate governance as it conducted twenty (20) regular and five (5) special en banc meetings or total of twenty-five (25) Board Actions for implementation by MWSS-CO and MWSS-RO. Twenty-two (22) Minutes of the Meetings had been submitted, approved and confirmed.

The Board rationalized the constitution of the different board committees for the performance of certain functions and harmonize them with Section 16 of the Governance Commission for GOCCs (GCG) MC No. 2012-07 (Code of Corporate Governance for GOCCs) and MWSS By-Laws. This resulted to the merging of previously independent committees with related functions.

The Board as part of its regular self-assessment revisited its committee structures to consider overlapping responsibilities or no work being done. The 9-member Board decided that they can effectively work through the following committees: (1) Executive & Governance Committee (EGC), (2) Concession Monitoring & Health and Sanitation Committee (CMHSC), (3) Audit and Risk Management, Engineering, Business and Finance Committee (ARMEBFC), and (4) Human Resource and Administration Committee (HRAC).

MWSS BOARD OF TRUSTEES ACCOMPLISHMENTSHIGHLIGHTS

RECONSTITUTION OF COMMITTEES

1. Executive & Governance

Committee

The EGC is composed of the following Trustees:

Chairman

Vice-Chairman

Members

Franklin J. Demonteverde

Reynaldo V. Velasco

Jose R. Hernandez

Merly M. Cruz

Melanie Sia-Lambino

Rudolf Philip B. Jurado

EXECUTIVE & GOVERNANCE COMMITTEE (EGC)


EGC‘s responsibilities include: (1) overseeing the periodic performance evaluation of the Board and its committees and the conduct of an annual self-evaluation of their performance; (2) deciding on whether or not a Trustee is adequately carrying out his/her duties. (Note: Even as the Trustees serve on multiple Boards, internal guidelines shall be adopted that address the competing time commitments); and (3) recommending to the Board on the continuing education of the Trustees, assignment to Board Committees, succession plan for the Executive Officers and remuneration.

The EGC has convened a total of seventeen (17) meetings.

2. Concession Monitoring & Health and Sanitation Committee

The CMHSC is a result of the expansion of the function of the former Concession Monitoring Committee to include health and sanitation.

CMHSC has the following functions: (1) provide overall strategies and direction to properly monitor, supervise, and implement the activities and projects of the Concessionaires; (2) recommend to the Board on how to improve regulatory functions over its concessionaires; and (3) act on matters involving water purification, maintenance of sanitary standards, and proper operation of the sewerage system.

CMHSC has convened a total of thirteen (13) meetings for 2018.

3. Audit and Risk Management, Engineering, Business and Finance Committee

In view of the changing needs of the agency the Audit and Risk Management Committee was restructured to include concerns on business and finance.

Jose R. Hernandez

Reynaldo V. Velasco

Valeriano F. Pasquil

Mariano C. Alegarbes

Melchior I. Acosta, Jr.


CONCESSION MONITORING & HEALTH AND SANITATION COMMITTEE (CMHSC)

The CMHSC is composed of the following Trustees:

Chairman

Members



Merly M. Cruz



Jose R. Hernandez

Melanie Sia-Lambino

AUDIT & RISK MANAGEMENT, ENGINEERING, BUSINESS AND FINANCE COMMITTEE (ARMEBFC)

Chairman

Members


The Committee is responsible for (1) overseeing, monitoring and evaluating the adequacy and effectiveness of MWSS’ internal control systems; (2) reviewing and approving audit scope and frequency of the annual internal audit plan; (3) receiving and reviewing reports of internal and external auditors and regulatory agencies; (4) ensuring that internal auditors have free and full access to all records, properties and personnel of MWSS; (5) developing a transparent financial management system; (6) performing oversight risk management functions; and (7) developing the Risk Management Policy of MWSS.

A total of 15 meetings were convened by ARMEBFC for the period.

4. Human Resource and Administration Committee

The HRAC was created in consideration of the joining of forces of the previous Committee on Administration and Human Resource Committee. The HRAC is composed of the following Trustees:



Melanie Sia-Lambino


Merly M. Cruz



HUMAN RESOURCE & ADMINISTRATION COMMITTEE (HRAC)

Chairman

Members

The functions of the HRAC covers the following: (a) approval of all human resources processes; (2) development of the Human Resources policies of the System; and (3) ensuring that Officers to be nominated/appointed are qualified.

The HRAC has convened a total of nine (9) meetings in 2018.


The number of directives the Board made served as guide and a push toward greater inclusion for the executive management. Using strategic policies and stakeholder lenses to establish board diversity goals, exercising inclusive leadership to harness the full collective intelligence of the board, and holding management accountable for inclusive leadership.

MILESTONE BOARD RESOLUTIONS INCLUDE THE FOLLOWING:

In addition to the reconstitution of committees, the Board also was able to approve and issue a total of 186 resolutions that now serves to guide the operations of the System.

One of the remarkable approvals of the BOT was the Early Retirement Incentive Package (ERIP) for the MWS-CO employees on 11 January 2018 which was a pre-requisite to the reorganization of the MWSS-CO. There were 25 employees who were the beneficiaries of the ERIP.

BOARD RESOLUTIONS

On 22 February 2018, upon issuance of Opinion No. 042, Series of 2018 by the Office of the Government Corporate Counsel (OGCC), the BOT issued Board Resolution No. 2018-028-CO approving the immediate release of the ERIP benefits to the ERIPIANS, subject to submission of all required clearances.

On 8 March 2018, the BOT issued Board Resolution No. 2018-045-CO, or the approval of the New Centennial Water Source-Kaliwa Dam Project (NCWS-KDP) and the change of project financing from PPP to ODA.

On 11 July 2018, the BOT issued Board Resolution No. 2018-100-RO approving the Terms of Reference (TOR) for the Procurement of Build Infrastructure Project of the Proposed Three-Storey Regulatory Building. The said approval is in compliance with Section 3 of Exhibit A of the Concession Agreement, which states that the office of the Regulatory Office should be physically separate to the offices of the two concessionaires.

On 11 October 2018, through Resolution No. 2018-153-CO, the Collective Negotiation Agreement (CNA) between MWSS and MWSS Labor Association (MLA) for the period CY 2018-2023, was approved.

On 16 November 2018, the BOT issued Board Resolution No. 2018-186-CO, approving the release to the National Government (NG) of the amount of Php598M representing full remittance of collection from the two Concessionaires for the Japan Bank for International Cooperation (JBIC) Loan.


THE MWSS RAW WATER CONVEYANCE SYSTEM

Diagram from Engineering Dept:

It all starts with the Angat Watershed that provides raw bulk water to the Angat Dam and Reservoir. Angat Dam is the main water source of the people of Metro Manila, which is also getting additional water from the Umiray River through the Umiray-Angat Transbasin Tunnel. From Angat Dam, the raw water courses a distance of 6.4 kilometers directly to Ipo Dam then to the three tunnels and basins in Bicti. Currently, the construction of the 4th tunnel is on-going to increase reliability of raw water. Another on-going project is the BBWSP, which is going to be tapped from one of the six aqueducts to provide water in the districts of Bulacan.

The basins then, control the water flowing from it to the six 16-km aqueducts going to the La Mesa Dam through the La Mesa Portal. From the La Mesa portal, 60% of water goes to La Mesa Treatment Plant and 40% goes to the Balara Treatment Plant.

The Balara and La Mesa Treatment Plants process water from its raw state to clean and potable water through series of screening and cleansing processes. The Balara Treatment Plant has a production capacity of 1,600 mld and supplies more than six million people in the metro. The La Mesa Treatment Plant, on the other hand, produces a capacity of 2,400 mld which supplies more than nine million people in the metro as well.

The La Mesa Water Treatment Plant is being operated by Maynilad that serves the West Zone of the Concession area and the Balara Water Treatment Plant is being operated by Manila Water that serves the East Zone of the Concession Area.


2018 WATER SECURITY INFRASTRUCTURE PRIORITIES

Shown below is the approved 2013 MWSS Water Security Infrastructure Roadmap.

While some of the dates of water availability have slipped since the Roadmap was derived, mainly due to political opposition and environmental issues as in the case of UATP and Sumag; most of the projects like Laguna Lake and Putatan expansion are in various stages of completion and expected to cover short term demand.

Ongoing projects that will increase supply by 71.67 m3/s and restore the full design capacity of the Angat system will be realized with the completion of Sumag River Diversion Project, Angat Dam and Dyke Strengthening Project and the addition of Tunnel 4 under the Angat Water Transmission Improvement Project or the AWTIP.


Another engineering project in MWSS’ priority project pipeline is the Ipo Dam 3. In July 2018, MWSS requested NEDA to include the project as Priority Infrastructure Project of the government. The feasibility study of the project is being funded by NEDA under its Administered Project Development and other Related Studies Fund. Ipo Dam 3 is intended to provide catchment for Angat Dam spillage for an efficient management of water and help mitigate the flooding in Bulacan.

There are other urban water security options currently being explored as alternative sources of water such as the untapped water wastage from Angat, revival of the Bayabas Dam, and the Candaba Multi-Purpose Impounding Dam, or the ABC projects which has a combined potential of producing 1,950 MLD.

With new approaches and portfolio of options whether rehabilitating transmission systems, upgrading water structures and networks, promoting green infrastructure (reforestation and watershed management), or initiating policy changes, the foundation for longer-term management of resources is MWSS’ overarching priority.


WATER RESOURCE AND INFRASTRUCTURE DEVELOPMENT


BULACAN BULK WATER SUPPLY PROJECT (BBWSP)The P16.32 Billion BBWSP is set for a formal launch in January 2019.

Water scarcity has been experienced in Bulacan since the 1980s, which prompted the MWSS to supply bulk water to province.

The first phase of the project which is the construction of facilities for abstraction, treatment, and conveyance of treated bulk water supply is 100% complete. It will provide six (6) municipalities and two (2) cities of Bulacan with treated water amounting to 400 million liters per day (MLD) once the water districts are interconnected and commissioned.

The second phase is 97% complete and will supply additional seven (7) water districts. The second phase could ramp up water delivery to as much as 800 MLD.

The project was built by the joint venture of San Miguel Holdings (80%) and Korea Water Resources Corp. (20% under a 25-year concession period.

The joint venture was formed into a consortium and was named, Luzon Clean Water Development Corporation (LCWDC). BBWSP is the first water project under the government’s public-private partnership (PPP) scheme. The LCWDC will offer treated water at P8.50 per cubic meter to the 24 water districts with existing Memorandum of Agreement with MWSS.

The water rate is fixed at P8.52, which is lower than the operational expense of the water disricts. There is only one rate rebasing, happening on the 5th year.

The MWSS will be regulating LCWDC in accomplishing the key point requirements such as availability, pressure, water quality, and water losses as agreed in the Concession Agreement.


With the approval of the Board, Management decided not to pursue the proposed consulting services for the Construction Management in 2017 as most of the pre-construction works and Detailed Engineering Design were already completed.

By end of 2018, the Project was 14% ahead of schedule.

Project Component Amount WDs to be Benefited

Ten (10) water districts Angat, Baliwag, Bustos, Dona Remedios Trinidad, Hagonoy, Norzagaray, Pulilan, San Ildefonso, San Miguel, & San Rafael

Six (6) water districts Balagtas, Bocaue, Marilao, Meycauayan, Obando & San Jose Del Monte

Seven (7) water districts Bulacan, Calumpit, Guiguinto, Malolos, Paombong, Plaridel & Santa Maria

PhP 7.16B

Stage 1

Stage 2

PhP 2.45BStage 3

Operation and Maintenance PhP 6.71B All Water Districts mentioned


NCWSP is a legacy water project that will provide some redundancy in supply sources and augment supply to meet increasing water demand thus curb the prophesied water shortage in the 2020s.

The Kaliwa Dam project, which would have a capacity of 600 million liters a day (MLD), will take more than five years to build and its water supply tunnel would have a 2,400-MLD capacity. The critical component of the project is the 27-kilometer tunnel that would connect the water source to the MWSS Concessionaires’ treatment plants.

The construction of the project was first approved by the National Economic and Development Authority in 2014. Financing scheme was changed in 2017 from a public-private partnership to Official Development Assistance (ODA) from China.

And since the ODA is coming from the Chinese government, the Philippines had to choose a Chinese contractor from among the names submitted by the People’s Republic of China — China Engineering Co., Ltd., Power China Limited, and the consortium of Guandung Foreign Construction, Co., Ltd. and Guandong Yuantian Engineering Co., Ltd.

After 34 years of delay, Kaliwa Dam is set to fully take off following the formal signing of the loan agreement between President Duterte and Chinese President Xi Jinping in November 2018.

Of the P12.189 Billion construction cost, 85% of the Approved Budget for Contract will be funded under ODA loan amounting to P10.2 Billion (US $211.21 Million), while 15% or P1.83 Billion will be shouldered by MWSS.

The MWSS aims to finish the portion of the dam by 2022.

NEW CENTENNIAL WATER SUPPLY PROJECT- KALIWA

DAM PROJECT (NCWSP-KDP)


• Secured project endorsement from the LGU of Tanay on 09 January 2018.

• Collaborated with DPWH for the construction of the 12-km access road to the damsite. DPWH contractor has started construction works with 25% physical accomplishment.

• Access Road to Tunnel Outlet: 36% of the 8.87 km road have been upgraded; and a new 1.54 kms access road has started with 56% physical accomplishment.

• The NCWSP-KDP team is working alongside the National Commission on Indigenous Peoples (NCIP) to acquire the Free and Prior Informed Consent (FPIC) of the Indigeneous Peoples (IPs) that is part of the clearances and permits required for the project. Work and Financial Plan (WFP) of Quezon and Rizal Provinces and the corresponding Memorandum of Agreement with NCIP have been signed.

• Full clearance was granted by the Protected Area Management Board (PAMB) on 29 May 2018, corresponding PAMB 1635 Kapasiyahan Bilang 006- 2018 was signed through a referendum.

• China Energy Engineering Corporation (CEEC) was declared as the Bidder with the Lowest Calculated Responsive Bid (LCRB) on 24 August 2018, in the total bid price

• Notice of Award (NOA) was issued on 21 November 2018 to the Joint Venture of EDCOP, PRIMEX and SMEC for the Consultancy Services.

• Loan Signing was done on 20 November 2018 during the state visit to the country of China President Xi Jinping.

• Notice of Award (NOA) was issued on 11 December 2018 to China Energy Engineering Corporation Limited (CEEC) for the Detailed Engineering Design (DED) and construction works.

• Acquisition of properties for the tunnel outlet portal being negotiated with lot owners.

2018 ACCOMPLISHMENTS :


REHABILITATION, OPERATION AND MAINTENANCE (O&M) OF AHEPP AUXILIARY TURBINES 4 AND 5

Auxiliary Turbines 4 and 5 (AN-4 & AN-5) which are owned by MWSS are components of the Angat Hydro-Electric Power Plant (AHEPP), and produces hydropower as a by-product of water flowing through the turbines. Once rehabilitated, the hydropower could generate 28 megawatts with an estimated annual electricity production of 145.70 GWH which will supplement power for the Luzon Grid. But since operating a power plant is not within the jurisdiction of MWSS nor does it have the capability to do it, MWSS opted instead to entering into an O&M Agreement with the private sector through a Public-Private Partnership (PPP) scheme for the rehabilitation, operation and maintenance of these turbines. The rehabilitation will extend the economic life of AN-4 & AN-5 by another 30 years as well as increase their energy output and load capacity to 60 percent through the replacement of runners and electro-mechanical equipment.

This 1.509 Million project, however, declared a failure on its first bidding in 2012, before the Supreme Court’s final ruling on the sale of Angat Dam to K-Water. While preparing for a second round of bidding, the Supreme Court released the landmark decision declaring the award of AHEPP to K-Water, thus again impeding MWSS’ plan for rehabilitation. In Dec of 2013, the OGCC released its opinion (OGCC Opinion No.269) stating that MWSS may lawfully negotiate with K-Water on the terms of collaboration with K-Water with regards to the turbines. To complement the opinion, MWSS sought NEDA’s approval if they could directly negotiate with AHC, which approval was granted in 2016.


In December of 2017, the MWSS Board approved the re-bidding of the Project through Public-Private Partnership scheme under the Build-Operate-Transfer Law or (BOT Law) RA 6957, as amended by RA 7718. The MWSS is currently reviewing the bidding and other related documents.

ACCOMPLISHMENTS IN CY 2018The MWSS, in its letter dated 19 March 2018, submitted to NEDA for ICC revalidation the updated Project Cost Estimate (PhP1.563B) and the corresponding PPP-PE forms. Once the MWSS receive NEDA’s confirmation of the continued viability of the Project, the re-bidding of the Project will immediately proceed.

On-going coordination with NEDA, DOF and PPP Center for the preparation and submission of documents required by the NEDA Investment Coordination Committee (NEDA-ICC) relative to its evaluation and submission for NEDA Board approval.

Reconvening of the Technical Working Group and on-going preparation & discussion by the Inter-Agency Technical Working Group (MWSS, DOE, NPC, DOE and PPP Center) on the proposed water and asset sharing agreements with Angat Hydropower Corp (AHC, the AHEPP owner/operator). This agreement, once finalized, will be discussed/agreed with AHC, and will form part of the bidding documents.


Originally a component of the Umiray-Angat Transbasin Project (UATP), the project involves the tapping of raw water coming from Sumag River to the Umiray Tunnel that could generate an additional volume of 2.2 cms or 188 mld raw water to the Angat Reservoir.

This Php 774 million project, located in Umiray, General Nakar Quezon, is being implemented and funded by the Common Purpose Facility (CPF) Office of the two Concessionaires (Manila Water and Maynilad Water) and involves the construction of a 2.50m diameter x 600 meters length tunnel.

The contractor was selected through bidding with the Notice of Award issued to Cavite Ideal International Construction and Development Corporation in 2013 and the Notice to Proceed for the contract works, in 2014.

By 2016, 67.79% physical accomplishment was achieved by the contractor, but an unfortunate incident in 13 August 2016 caused the suspension of the project. The Sumag River overflowed that caused the coffer dam to collapse triggering the water to rush into the diversion tunnel that caused the death of 6 workers.

A Supplemental MOA by and amongst MWSS, MWCI, MWSI and LGU General Nakar on watershed protection and management was signed by the parties on 27 September 2017. This Supplemental MOA covers both the Sumag Diversion and Umiray Rehab Projects and is a condition of LGU General Nakar to lift the suspension of works. On 21 November 2017 the Lifting of Cease and Desist Order (CDO) was issued by LGU General Nakar during the meeting held at MWSS office. However, the permit has not been issued yet by LGU Gen. Nakar, despite the submission of the requirements for quarry permit by the contractor forestalling the resumption of the project.

Accomplishments in CY 2018: Requirements for quarry permit have been complied with.

SUMAG RIVER DIVERSION PROJECT


Ipo Dam 3 involves construction of a new water source that will have a functionality of mitigating floods in Bulacan and at the same time a possible source of water for irrigation. The construction is expected to run from July 2020-June 2023. Once done, the dam will serve as an impounding reservoir for water coming from the spills of the existing Ipo Dam and rains around the area.

On December 21, 2018, the Notice of Award was issued to Consultant EDCOP for the conduct of the Feasibility Study (FS). This dam which will be located in Norzagaray, Bulacan is estimated to hold 40 mld per day of raw water and is estimated to cost PHP 6 Billion.

IPO DAM 3 PROJECT

TOR for the Pre-Feasibility Study proposal was prepared.

The Pre-Feasibility Study (FS) consultancy is funded by NEDA through its Project Development and Other Related Studies (PDRS) Fund.

Feasibility Study (FS) will start in January 2019.

STATUS AS OF CY 2018:


WATER DISTRIBUTION EFFICIENCY


As of December 2018, physical accomplishment in the construction of new intake structures at Ipo reservoir and channel connecting the tunnel outlet to existing aqueducts (inlet works including cofferdam and auxiliary mechanical equipment, outlet works, tunnel and portal) is 84.49% complete.

AWTIP will modernize the system that brings water to Metro Manila through the Ipo Dam to Bigte settling basin. The new hydraulic tunnel, Tunnel No. 4, being built is an offshoot of the Angat Water Utilization and Aqueduct Improvement Project (AWUAIP), which involved the construction of a 6th aqueduct and upgrade of the 5th aqueduct and the interconnection of all six (6) aqueducts.

The tunnel has a length of 6.45 km with an internal diameter of 4.2 meters. Total length of tunnel to be excavated using a double shield Tunnel Boring Machine (TBM) is 6,007 meters. As of December 2018, only 438 lineal meters remains to be excavated or 92.92% physical accomplishment, or +1.24% ahead per target schedule of 91.68%.

ANGAT WATER TRANSMISSION IMPROVEMENT PROJECT (AWTIP)

Once completed, tunnel 4 will have the capacity to deliver 1,600 million liters of water daily or 19 cubic meters of water per second. The project will ensure adequate, clean and reliable water supply from Angat dam for the 14 million residents of Metro Manila and other consumers in Rizal, Bulacan and Cavite.


The Umiray-Angat Transbasin Tunnel Facilities provides additional raw water to the Angat Reservoir from the Umiray River thru Macua River. This 13-km tunnel’s intake facilities became operational in June 2000 and are located in Umiray, General Nakar Quezon while the outlets are situated in Macua, Doña Remedios Trinidad, Bulacan. The tunnel contributes about 20-30% (780 million liters per day) of water to Metro Manila.

Unfortunately, the tunnel and its facilities were severely damaged by a typhoon on November 29, 2004. Debris, boulders and logs clogged the flow of water in the tunnel and took 3.5 months of de-clogging before the normal operations finally resumed. Due to this, management decided to rehabilitate the structures to strengthen and protect the facilities from future floods and typhoons.

The project, intended for a permanent rehabilitation of the facilities, is funded and implemented by the Common Purpose Facility (CPF) Office of the two (2) Concessionaires (Manila Water and

Maynilad). It was awarded to A.M. Oreta Construction with the Notice to Proceed having been being issued on 20 April 2016. This 717M project had reached 37.87% of its actual

physical accomplishment, as of 31 July 2016, before being unfortunately suspended in August 2016 during the aftermath of the accident in Sumag which also caused

the suspension of the UATP Rehab project.

UMIRAY-ANGAT TRANSBASIN TUNNEL FACILITIES REHABILITATION


Since the project is associated with General Nakar, a MOA with the latter regarding the protection of their watersheds was signed by MWSS, somehow causing the lifting of the Cease and Desist Order (CDO) by LGU Gen. Nakar. As well, the contractor for this Project prepared the necessary documentation works and the CPF provided the requirements for construction permit that paved the way for LGU Gen. Nakar to approve the resumption of contract works

• The contract works at the outlet area (Bulacan side) is in progress, while works at the inlet area (Quezon side) is suspended due to the peace and order situation in the area.

• The construction works which resumed last 12 February 2018, is on-going with 59.542% accomplishment.

ACCOMPLISHMENTS IN CY 2018:


The project is part of the re-engineering works for the Umiray-Angat raw water transmission system in order to ensure continuous and adequate flow of water consistent with our objective of water security and reliability.

The overall objectives of AQ-7 are:

1. To provide operational flexibility to the raw water transmission from Ipo Dam to La Mesa Dam particularly during the repair or rehabilitation of the existing aqueducts;

2. To replace the oldest and deteriorated aqueducts Aqueduct No. 1 and Aqueduct No. 2;

3. To provide additional raw water transmission capacity in the event of additional allocation.

The project components include:

1. Three segments tunnel works with combined length of about 15 kms;

2. Aqueduct crossing about 19 rivers and waterways, 23 roadways, and 11 aqueducts;

3. New receiving basin at Novaliches junction;

4. Two (2) interconnections at Bigte basin and one at Novaliches portal; and

5. Two (2) stubouts for Bulacan areas.

The ADB through a Project Preparatory Technical Assistance has funded the Feasibility Study, the final report submitted in December 2018. Due to the constraints in the MWSS’ right-of way, AQ -7 will be constructed along the alignment of the existing AQ #1 and AQ #2, traversing the existing 60-meter MWSS ROW from Bigte, Norzagaray, Bulacan (inlet portion) to La Mesa Portal in Novaliches, QC (outlet portion), where part of it will be demolished or unearthed.

To ensure that raw water supply to concessionaire will not be affected, the construction of AQ 7 will start only upon the decommissioning of AQ-1 and 2 and the completion of the construction of Tunnel 4. The proposed AQ 7 will replace the old AQ-1 and 2 lines and will follow the alignment of AQ-1.

The CPF has already started the fencing of the project to secure the ROW and clear the area from informal settlers and other structures.

The construction of AQ 7 has a total project cost of P7,420.22 million which is proposed to be funded through a new loan from ADB.

STATUS AS OF CY 2018:

• Submitted to NEDA ICC and the DOF the project documents for its evaluation and review

AQUEDUCT NO. 7 (AQ-7)


The immediate construction of Tunnel # 5 is one of the key measures that will address the water shortage issues especially during dry or El Nino season and will help ensure uninterrupted water supply from Umiray-Angat water system to the customers taps.

Tunnel # 5 is set to replace or support the existing old Tunnel No. 1 and will complement Aqueduct #7.

Estimated to cost P3.0 Billion to construct, the 3.60 meter diameter, 6.5 kilometer in length Tunnel #5 will provide another 1,600 MLD to flow towards La Mesa Dam.

The project cost will be equally split between MWSS’ Concessionaires. A savings of about 25 to 30 percent is expected because the tunnel boring equipment used in the construction of AWTIP or Tunnel #4 will again be used for Tunnel #5.

TUNNEL NO. 5 PROJECT


SEWERAGE AND SANITATION


Following the Concessionaires’ provision on sewerage and sanitation services in compliance to the Concession Agreement (1997-2022) and Concessions Agreement’s Term Extension (2022-2037), MWSS has continuously been reinforcing the two concessionaires’ services to providing efficient and safe services on sewerage and sanitation within their areas of jurisdiction through Key Performance Indicators (KPIs) and Business Efficiency Measures (BEMs) reports.

Nonetheless, incessant challenges continue to arise due to the following factors:

1. Congestion in the metropolis

2. Availability of land for wastewater facilities

3. Acquisition of right of way for sewer lines

4. Solid wastes in the influent

5. Uncontrollable influent quality

6. Capacity and willingness to pay

7. Consistency in regulations and regulatory environment


Despite the factors raised, sewerage and sanitation compliance continue:

1. Clean-up of Manila Bay

2. Three-River System Improvement Program (a program for the treatment of sewer and wastewater) (before such

water returns to the 3-river system of San Juan, Marikina and Mandaluyong)

3. Continuous desludging of septic tanks per targets set

4. Breakdown of targets per municipality and city of prioritization and better monitoring

5. Adoption of a creek interception and drainage outflow interception

6. Setting-up of wastewater treatment facilities in defined catchment areas and major interceptor lines

7. Upgrading and expansion of Central Manila Sewerage System

8. Better target and standard-setting

9. Improved treatment technology and design capacity for Sewerage Treatment Plants (STPs)

10. Improved sewer ordinance and policy making

11. Continuing awareness campaign on water reuse

Monitoring activities of the Regulatory Office have yielded positive results in the accomplishment of the two Concessionaires for 2018.

For Maynilad, water service connections steadily increased since 1997 along with the sewer service connection. The increase in 2018 was due to the combined sewer connections in areas of Quezon City, Parañaque and Pasay City. Sewer coverage target also gradually accelerated from 2009 in compliance to the Supreme Court’s continuing Mandamus for the clean-up, rehabilitation and preservation of Manila Bay where MWSS was directed to complete, not beyond 2037, all wastewater facilities within its service area. The availment rate for desludging services also increased and had a big leap in 2016 onwards.

For Manila Water, water service connections increased over the years together with the sewer service connections. Septic tank availment also rose in 2008. However, sanitation coverage for Manila Water had its ups and downs since 2012 up to 2018. Sewer coverage target also increased since 2010 in compliance to the Supreme Court’s continuing Mandamus.


Below is the summarized performance information of the two Concessionaires from CY 1997-2018:


*New Sewer Service Connection – the performance of the Concessionaire in terms of providing sewer services to all water connected Customers within its concession area.*Sewer Coverage Target – the coverage target percentages of the total population in the designated municipality connected to the Concessionaire’s water system at the time of the targets set out in the Concession Agreement.*Septic Tanks Desludged – the performance of the Concessionaire in terms of providing desludging services to customers within its service area.*Sanitation Coverage – the Concessionaire’s compliance in meeting the sanitation coverage target percentages of the total population in the designated city/municipality connected to the Concessionaire’s water system at the time of the targets set out in the Concession Agreement.


WATER RATES AND REVIEW RATIONALIZATION


WATER RATES REVIEW AND RATIONALIZATION

The Corporate Office (CO) takes a third party role in enhancing value for the customers in the interest of the public, in the sense serve as catalyst to deliver positive results in the evaluation of the Concessionaires proposed business plan.

The CO because of the retirement of officers involved in the previous rebasing periods, created a new team to evaluate the Business Plan, particularly the Concessionaires CAPEX proposals for Rate R ebasing 2018 to 2022 (4th RR18). Concessionaires’ new sets of programs and projects had been reviewed if it is in substantial compliance with the Concessionaires commitments in the 2009 Term Extension and the Concession Agreement; and its relevance to the MWSS-CO’s water and wastewater masterplan.

The CO saw to it that in its review of 4th RR18 the proposed CAPEX are aligned with the updated demand projections, water sources roadmap, and DENR Department Administrative Order No. 2016-08 (Nutrient Removal for effluent discharge) for wastewater infrastructure facilities. The evaluation of future projects was complex because of the enormous numbers of projects proposed but with incomplete data; and long distances of locations inspected and assessed (from Bulacan to Metro Manila, Cavite, Rizal and Laguna).

The 4th RR18 was explained to the water consumers through public consultations which is an important component in the rate review. The CO joined the Regulatory Office in the public consultations where the objectives and methodology of the rate rebasing exercise was presented.

In September 2018, as a result of the CAPEX review by the CO and the prudency and efficiency tests by the RO, the rebasing adjustments for 4th RR 18 was approved and is summarized as shown below:

Maynilad Manila WaterDate Filed 31 March 2017 31 March 2017Proposal Upward adjustment of 29.63% of the

Average Basic Charge of Php32.70 or Php9.69 per cu.m.

On 12 January 2018, Maynilad submitted a Revised “R” of 30.95% of the Average Basic Charge or Php10.12 per cu.m.

One-time tariff increase (in real terms) of 33.14% of the basic rate of Php25.05 or Php8.30 per cu.m.

On 11 April 2018, Manila Water filed an Amended RR Plan of 38.49% of the basic charge of Php24.82 or Php9.55 per cu.m.

BOT Resolution 2018-136-RO dated 13 September 2018

2018-145-RO dated 27 September 2018

Effective 01 October 2018, positive adjustment and partial “R” of 2.70% of the pre-rebased 2017 basic tariff of Php33.39 or Php0.90 per cubic meter and subsequent Charging Years as follows:2020 = Php1.95 per cu.m.2021 = Php1.95 per cu.m.2022 = Php0.93 per cu.m.

Effective 16 October 2018, positive adjustment and partial “R” of 5.7% of the pre-rebased 2017 basic tariff of Php24.82 or Php1.46 per cubic meter and subsequent Charging Years as follows:2020 = Php2.00 per cu.m.2021 = Php 2.00 per cu.m.2022 = Php0.76 per cu.m. and an additional Php0.28 per cubic meter subject to the validation of the RO of the feasibility and cost of the Wawa Bulk Water Source to Calawis Project as Manila Water’s medium term water source.


ORGANIZATIONAL EXCELLENCE


In connection with the implementation of the updated ISSP in 2017, the Information Systems Strategic Plan of MWSS in 2018 is already making progress as the approval from the Department of Information and Communications Technology (DICT) for the clearance to procure in CY 2018 has already been received on September 25, 2018. It will start with the procurement activities that involve the development of Asset Management Information System (AMIS) and establishment of Network and IT Infrastructure Facilities (NITIF). These will gradually ensure that MWSS can adapt to the requirement of all government agencies and address the demands of technology advancement.

The AMIS and NITIF projects have already been advertised and posted on the Philippine Government Electronic Procurement System (PHILGEPS) portal and on the newspaper for pre-bid preparations. Subsequently, the dissemination of bid bulletins and pre-bid conference has already been conducted in October of 2018. Unfortunately, the procurement of AMIS and NITIF resulted to failure of biddings. Some bidders expressed their interests but did not actually submit their bid documents on the specified submission date. Due to this, necessary changes and improvements in the Terms of Reference for both projects are currently being done by the Bids and Awards Committee (BAC) for the rebidding of the projects.

On the other hand, another concurrent project is the procurement of document scanning devices to commence the digitization process within the agency. This is to prepare MWSS for the Document Management System program (DMS) that will be rolled out once a central network infrastructure has been established.

MWSS’ INFORMATION SYSTEMS STRATEGIC PLAN (ISSP) IN 2018


Hopefully in the succeeding years, the preparation of Project Management System, Hydrologic Monitoring System, Finance Management Information System, HR Information System and Rain Monitoring System will transpire. Correlated with the reorganization that took place during the year along with the establishment of the Information Technology division, all these will support and sustain the technological needs of the office that will contribute to a world-class digital organization that the MWSS continues to aspire.

Below is the implementation plan for 2018-2020:


2018 PERFORMANCE EVALUATION SCORECARD (PES): ANOTHER YEAR OF GROWTH AND IMPROVED OPERATING PERFORMANCE

MWSS-CO’s performance is measured on standards and work objectives as agreed with the Governance Commission for GOCCs (GCG). The Performance Scorecard has two (2) main features:

a. Strategic Objectives (SO) which are based on relevant and acceptable performance standards applicable to all GOCCs and;

b. Strategic Measures (SM) that capture the dimensions of metric (what is being measured), target and baseline (current performance) inherent to a particular GOCC.

The Performance Scorecard committed by the MWSS-CO with the GCG is an official document and is used in tracking adherence to governance measures. It also provides a comprehensive view of progress and challenges on operational and financial viability during the rating period. Moreover, it is the basis for the Agency’s personnel to become eligible to receive the Performance Based Bonus (PBB) for employees and Performance Based Incentives (PBI) for the Board of Trustees.


Targets for Strategic Objective Nos. 1-4 as shown in the table above, were fully achieved and were the driver of results. What weighed down the score is SO No. 4 attributed to the very lean workforce as an aftermath of the Early Retirement Incentive Program implemented during the year. Despite the slight drop in 2018 score from 95% in 2017 to 94%, the MWSS-CO has consistently attained a weighted average of above 90% on its Performance Scorecard and has complied with all the Good Governance Conditions as evaluated by the GCG for the past six (6) years since PES was implemented.


In order to comply with the mandate of ensuring an uninterrupted and adequate supply and distribution of potable water and proper sewerage and sanitation services for its service area, the MWSS-CO continuously strives to be a technically competent agency through hiring of skilled personnel, delivering efficient water infrastructures and abiding to the directives of supervisory agencies like GCG.

In the last quarter of 2017 until early 2018, MWSS-CO reactivated its efforts to target certification from the International Organization for Standardization (ISO), for its Quality Management System or ISO9001:2015. The aim is to certify the Project Management process, being a core process of MWSS, to further improve its quality of services and operations and at the same time comply with the GCG’s directives.

ISO is an international organization that develops voluntary international standards in various fields of engagement and processes. Certification brings not only confidence that the company is working by international standards, but also the prestige that goes with it.

On 15th of May, 2018, MWSS organized a two-day orientation seminar on ISO 9001:2015 attended by selected employees at San Mateo, Rizal. The seminar aimed to introduce and acquaint the employees about the crucial process and information on how to get ISO-certified. Interactive exercises were imparted to give the experience of what and how the actual audit is done.

After the training, participants prepared by reviewing and reassessing each department’s detailed work flow process in support to Project Management. The departments worked together by having discussions and meetings on reassessing detailed work processes and effecting solutions and amendments in order to further improve work methods in relation to each other.

MWSS TARGETS ISO9001:2015 CERTIFICATION FOR THE PROJECT MANAGEMENT TEAM


Internal Quality Audit (IQA) and management review also took place as required processes. Finally, necessary documentations were prepared like the Quality Manual, the IQA Report, and the TECOP/ PESTLE Risk Matrices.

An ISO certifying body, AJA Registrars, Inc., procured through public bidding, assessed MWSS-CO through two stages audit, to wit:

a. Stage 1 audit: ISO 9001:2015 QMS adequacy and readiness review

b. Stage 2 audit: ISO 9001:2015 QMS implementation audit

MWSS-CO’s compliance with the audit standards and certification requirements of the certifying body means issuance of ISO 9001:2015 certificate.

After a tedious process, MWSS-CO passed the standards of ISO 9001:2015 and the certification was granted on December 13, 2018. Now, the agency is preparing for the two-year cycle of audit surveillance.

The certification is perceived as a necessary step to becoming a world-class competent agency benefitting theConcessionaires, other government agencies and most especially the public sector. The certification is effective until December 13, 2021.


GENDER EQUITY IN MAINSTREAM OF MWSS’ OPERATIONS

Pursuant to Republic Act 9710 also known as “The Magna Carta of Women” and its Implementing Rules and Regulations, the MWSS-CO conducted the Basic Gender and Development (GAD) Awareness Orientation for its employees on 17th and 18th of September 2018. All employees from the different departments attended the orientation held in MWSS Bulwagan.

Ms. Maricar R. Chan was invited as speaker who underscored the differences between Gender Equality and Gender Equity as “sameness” and “fairness” respectively. Hence, gender equity supports the differences of men and women, and their equal access to opportunities.

The speaker challenged the participants to start from understanding their own selves— their personalities and values affecting perception of GAD concepts and advocacies. Gender sensitivity was also discussed as “the ability to recognise gender issues, especially women’s different perceptions and interest arising from unique social position and gender roles”. Furthermore the lecture emphasised, “GAD is about being faithful to the principle that DEVELOPMEN IS FOR ALL.” These were among the more important points delved into during the activity in order to attain gender equity through harmonized efforts.

TRAININGS CONDUCTED


Moving on to the meat of the matter, gender mainstreaming was defined as inclusion of a gender perspective in the design and implementation of plans and programs to carry out organization’s mandates.

Entry points of gender mainstreaming were identified as policy, people, enabling mechanisms, programs, projects & activities. The participants were advised to apply their knowledge of GAD concepts and advocacies in their own duties and responsibilities at work.

The lecture emphasised that gender mainstreaming comes in to the center of operations influencing the employees who make the policies, who implement these policies, and who work on the completion of programs, projects and activities.

With sufficient knowledge in understanding one’s self and how own personalities and values affect perspectives about gender issues, the employees were able to incorporate GAD objectives in their own work with less constraints.

The need to influence each employee who partakes in the operations of the State’s water and sewerage is the primary objective in conducting this awareness orientation. The harmonized actions of employees is vital in empowering men and women by equalizing their growth potentials in aspects of life.


MWSS MANAGERS AND SUPERVISORS RECEIVE ORIENTATION ON 2017 ORAOHRA

MWSS employees holding managerial and supervisory positions attended seminar on the 2017 Omnibus Rules on Appointments and Other Human Resources Actions (ORAOHRA) by Director Hans R. Alacantara, Director II of Civil Service Commission (CSC) Quezon City Field Office on 29-30 May 2018 at the MWSS Bulwagan. The seminar commenced with a presentation of the CSC Memorandum Circular No. 24 series of 2017 Resolution No. 1701009. The resolution states the Commission’s adoption and promulgation of the 2017 ORAOHRA which specified the rules and regulations in human resource actions affecting government employees in the first and second levels. These rules have been reviewed and updated to adapt to present circumstances and legal matters.

The seminar covered the discussion of all 17 rules in the 2017 ORAORHA, beginning from Appointments — its general policies, requirements for regular appointments, procedures in its preparation, effectivity and submission of appointments, probationary period, employment status, nature of appointment and other human resource actions. These subjects comprise rules I-VI of the omnibus, and the sections include the definition of relevant terms, differentiation of types of agencies ‘regulated agencies’ and ‘accredited/deregulated agencies’, employment statuses such as permanent, temporary, coterminous, contractual, substitute, and provisional appointments. Understanding these terms are essential in implementing the omnibus rules as the procedures vary among these types and statuses.

Rules VII-IX encompass the procedures in recruitment/hiring, starting from the publication and posting of vacant positions, qualification standards, agency merit selection plan, and human resource merit promotion and selection board. The speaker discussed the sections in these rules comprehensively, taking into account the requirements for each action, from hiring to promoting employees.

Rules X-XII put into detail the procedures covering certain modes of separation including documentary requirements for record purposes, disapproval/invalidation and recall of approval/validation of appointments, and prohibitions.

Rules XIII stated thoroughly the responsibilities of the Human Resource Management (HRM) officer or authorized employee to handle the agency’s HRM. Rules XIV, XV, XVI and XVII enumerated the transitory provisions, repealing clauses, separability clause, and effectivity respectively.

This seminar was essential in strengthening the functions of managers, supervisors and the HRM in implementing the 2017 ORAOHRA. The set of rules stated in the 2017 ORAOHRA provides guidelines to the mangers, supervisors, and the HRM in exercising their duties to ensure the practice of appropriate and lawful human resource actions.


MWSS EMPLOYEES UNDERGO WORKSHOP ON COACHING

The MWSS conducted a workshop on Coaching and Mentoring for all its employees in 2018. Director Hans R. Alcantara, Director II of Civil Service Commission Field Office-University of the Philippines was

invited to share his time and expertise as resource speaker. The workshop was given in three batches, on July 30, on October 3-4, and on December 19 and 21.

The workshop covered lecture on definitions and characteristics of coaching and mentoring, and discussion of the GROW Model of Coaching and the 30 principles of coaching.

The resource speaker underscored that Coaching is not externally-driven and thus different from advising, teaching instructing and mentoring. He explained that the success of coaching depends on the coaches’ belief that the coachee will find the best solutions for themselves. Elaborating further, he differentiated coaching from mentoring as moving forward and career/personal development.

The GROW Process of Coaching deals with Goal, Reality, Options, and Wrap Up or Way Forward. According to Dir. Alcantara, first, the coach needs to identify the target outcome which is the Goal. Second, the coach needs to consider his or her management/leadership style and how others perceive it. This is the Reality. Third, the coach thinks of possible approaches to achieve the target outcome in consideration of the real situation. Lastly, the coach makes plans on how to approach the current situation to attain the goal. In the wrap-up or way forward, the coach considers the obstacles and additional support he or she can provide to the coachee in order to move forward.

The 30 coaching principles are elaborate the appropriate practices and values in coaching, areas for improvement for the coach, and strategies. The resource speaker emphasized the five As of Coaching effectively: Accountability, Action, Affirmation, Acknowledge, and Achievements. To apply these learnings, the speaker facilitated a workshop where forms for coaching, such as Coaching Journal and Post-Coaching Checklist, were used by the participants. In Skills Practice, for instance, sample situations were given. The participants were instructed to internalize the situations and fill out the forms based on how they will tackle these situations. In the role playing, the participants assumed the role of the coach and acted out how he or she will deal with the given situation.

To cap off the workshop, the resource speaker asked the participants to compose their individual discovery statement starting with the phrases “I discovered that” or “I learned that”. He further instructed them to accomplish the After-Action Review or AAR where the participants identified their new learnings, ways to apply these learnings, and to whom and how they can share it.


The MWSS-CO sought the expertise of Maynilad Water Academy (MWA)

in conducting a leadership training course on 16-17,19 April 2018. MWA speakers Ms.

Vina Vidal Vicente and Ms. Christine Bata gave lecture on Integrated Leadership Workshop for Leaders in the Water Industry with

the aim to elaborate the key elements influencing effective leadership. MWA was recently accredited by the

Civil Service Commission (January 2018) to provide trainings in improving services in water and sanitation.

The participants, who are mostly officers and employees holding supervisory functions, were oriented of the different personality types and their effects in leadership styles.

The speakers underscored the differences between leaders and managers, and the levels of leadership. Further discussions were made on coaching, building rapport, accountability and

crucial conversations. The lecture proceeded with a workshop where the participants applied their learnings about influencing by merging it with real life situations.

By conducting this training course, the MWSS-CO hopes to enhance the leadership capabilities of their

officials and employees. The MWSS believes in the importance of great leadership and harmonized efforts of its

constituents in providing excellent publicservice to the communities.

MWSS R

AISES THE B

AR IN

EFFECTIVE LE

ADERSHIP


MWSS EMPLOYEE BONG AGLUBA RECEIVES CSC’S PAG-ASA AWARD

Mr. Arnulfo “Bong” Agluba, head carpenter of MWSS-CO received the Civil Service Commission’s (CSC) PAG-ASA Award in a ceremony held at the Luxent Hotel in Quezon City on 10 September 2018.

The Pag-Asa award is part of the Honor Awards Program (HAP) given by the CSC every founding anniversary of their agency, to deserving employees. During its 118th founding celebration, CSC chose and honored again government employees from all over the country for exemplary dedication of their time and service to the government.

The 2018 HAP was opened by CSC Director IV Judith A. Dongallo-Chicano through her welcome message followed by the presentation of the awardees. The awards were divided into three categories namely, CSC Pag-Asa Award,

Dangal ng Bayan Award, and Presidential Lingkod Bayan Award to which MWSS employee Agluba made it to the final two spots of CSC Pag-Asa Award.

Agluba was chosen from among his fellow nominees all over the country for his remarkable contributions to MWSS-CO and to environment as well. As head carpenter, he diligently crafted all the woodworks and furniture needed by the agency which led to bigger savings as the need to contract out the carpentry projects was practical-ly eliminated. Few were also aware that Agluba’s creativity and resourcefulness, such as turning scrap woods into useful furniture, greatly lessened wastage to environment.


MWSS’ GIFT GIVING TRADITION TO DUMAGATS CONTINUES

The yearly tradition giving gifts to Dumagatbrethrens in Angat continues as a team of MWSS-CO officials and employees went to Angat on 19 December 2018.

For MWSS, the yearly gift-giving means imparting to theDumagats that they belong and are real members of this diverse society. The Dumagatsare continuously helping in the protection of watersheds as they act as overseerin maintaining the forest at theIpo and Angat Watershed areas.


MWSS-CO IMPLEMENTS CNAAfter a successful negotiation entered into by and between the Metropolitan Waterworks and Sewerage System (MWSS) and MWSS Labor Association (MLA)that started inAugust 2018, the Civil Service Commission (CSC) issued on 30 October 2018, the Certificate of Registration for the Collective Negotiation Agreement (CNA)byMWSS and MLA with a period of effectivity from 14 August 2018 to 13 August 2021.

The drafting of the new CNA started upon the assumption to office of the new MLA Board, which was granted fresh mandate by its members numbering about eighty (80) in an election held on 24 January 2019.

President RESTITUTO G. ESPEJO III

Vice-President EDGARDO J. CORDOVA

Executive Secretary SUSANNE S. STA MARIA

Assistant Executive Secretary EDNA S. ROLDAN

Treasurer CONRAD CASER P. NIXON

Asst. Treasurer EMELDA B. CODAMON

Auditor RAMON R. FABUL

PR / Business Manager NAPOLEON I. QUIÑONES

Sergeant-at-Arms DELFIN S. SESPEÑE

The new MLA officers and their corresponding positions are the following:


Espejo III, the new MLA President informed that the 2013-2017 CNA actually expired on 18 December 2017 but the previous Board invoked the automatic renewal clause for six (6) months, thus extending the period of effectivity of the previous CNA by another six (6) months. The responsibility of drafting and finishing the new CNA on time fell upon the hands of the new officers.

Constant consultations with the past Board, the MLA members, and the Human Resources and Organizational Development and Learning Department (HRODL) made it a lot easier for the new MLA Board to draft and finish the new CNA on time. After the successful negotiation with the MWSS management, the draft was presented to the general membership on 28 August 2018 and was ratified on the same day.

The new CNA was then recommended for approval and confirmation of the MWSS Board by the MWSS Management and was eventually approved after a series of presentations and justificationsof interest wereArticle II, Section 5 and Article IV, Section 3 which enable the MLA to collect from the salaries of the Management employees who are non-members of MLA but are benefited by the CNA an Assessment Fee of One Thousand Two Hundred Fifty (P1,250) for every CNA Incentives received by non-member every year.

The approval by the MWSS Board of the new CNAenabled all employees to receive P25,000 cash incentive in 2018.


IMPLEMENTATION OF THE ERIP AND REORGANIZATION

In line with the implementation of MWSS-CO’s reorganization which started in the first quarter of CY 2018, newly appointed officials and employees took their oath of office before Administrator Reynaldo V. Velasco (ret.) and the Board of Trustees.

The implementation of the reorganization process began with the Early Retirement Program (ERIP) of some 24 employees in December 2017 up to April 2018. After the ERIP, the agency proceeded with the filling up of positions based on the GCG-approved reorganized structure. The agency through the HR Department went through rigors of hiring from posting of advertisements for vacant positions, screening and selection of candidates, selection by the Placement and Selection Board of qualified candidates for endorsement to the Administrator. The process did not end there since a validated appointment should be released by the CSC to signify that the hiring is indeed in order. As of this writing, the hiring process is still on-going with the top positions being filled up first down to the lower positions.

The fusion of old reliable blood and new blood will hopefully bring about the positive impetus for Administrator Velasco to carry on with his vision of making MWSS achieve status of world-class benchmarked agency ready to sustain water security program by the year 2024.

Among the notable new appointments are the following:

ROMEO D. RODEROS : DA for Management Services Group

WALTER M. PARTOSA : Manager, Asset Management Department

AUGUSTINE M. VESTIL, JR. : Manager, Legal Services Department

RAMON R. FABUL : Manager, Water and Sewerage Management Department

JOSE D. DORADO JR. : Manager, Site Operations Management Department

JOSE ALFREDO B. ESCOTO, JR. : Manager, Field Operations Management Department

BYRON A. CARBON : Manager, Research and Standards Development

Department

ANABELLA S. ALTUNA : Manager, Operations Support Department


PARTNERSHIP DEVELOPMENT


A MILLION TREE CHALLENGE PROGRAM IN 2018The successful launch of the A Million Tree Challenge (AMTC) Program in 2017 took off to a good start as 1.2 million trees were planted through the unified efforts of the participating agencies. This 2018 is not a bad year either as 987,317 million trees planted were already accounted for as of latest count. On 27 July2018, a Recognition and Pledging Day for the AMTC participants was organized by MWSS-CO to recognize the efforts of current participants and invite more agencies to join.

On Pledging Day, DepEd Undersecretary Alain Del Pascua stated during his keynote speech that they were planning toinvolve 25 million students all over the Philippines, each to plant a tree every year in schools, communities, and other designated areas such as key watersheds in line with DepEd’s Makakalikasan Core Value. Congressman Leopoldo N. Bataoil (2nd District of Pangasinan), an ylang-ylang advocate, also joined the Recognition Day and even led the planting of ylang-ylang saplings near the Carriedo fountain in the MWSS compound.

The current participating agencies are MWSS-CO, MWSS-RO, DENR Regions III, IV-A & NCR, Manila Water, Maynilad, Bantay Kalikasan, WWF, PWWA and U.P. Mountaineers. Added to this year’s list were JCI Senate Philippines, Rotary Club District 3780, U.P Beta Sigma (BS National Assembly, LGUs of General Nakar and Laguna Lake Development Authority.

MWSS-CO also worked closely with the Ipo Watershed People’s Organization, Inc. - hired through public bidding- to help achieve its 100,000 commitment for 2018.


MWSS is optimistic that the AMTC program will evolve into an institution that will exist beyond five years it was originally set to exist and that it contributes to the President’s call to protect our environment.

Below is the status of commitments and trees planted for CY 2018:

MWSS Corporate Office 100,000 9,850

MWSS Regulatory Office 21,000 21,000

Dept. of Environment and Natural 350,000 539,377Resources (Region III)

Dept. of Environment and Natural 200,000 17,900Resources (Region IV-A)

Dept. of Environment and Natural Resources 100,000 107,391(National Capital Region)

Manila Water Company Inc. 100,000 40,000

Maynilad Water Services Inc.

World Wide Fund Philippines

UP Mountaineers

Philippine Water Works Association

Department of Education

Angat Hydropower

JCI Senate Philippines

Rotary Club District 3780

U.P Beta Sigma (BS National Assembly)

LGU – General Nakar

Laguna Lake Development Authority

ALFKI Bantay Kalikasan (ABS-CBN Lingkod 32,000 32,000Kapamilya Foundation, Inc.)

100,000

50,000

1,000

10,000

500,000

100,000

1,000

5,000

5,000

-

-

130,150

50,000

1,224

1,000

-

-

3,000

-

-

11,835

22,590

Total 1,665,000 987,317

Agency Commitment in 2018 Planted for 2018

MWSS PARTICIPATES IN MANILA BAY REHABILITATION PROGRAMGone are the days when sunsets in Manila Bayinterest tourists and locals alike because rubbish and smell that go with it have become more distinct than its beauty. To avert this, the Supreme Court, in a landmark decision on 18 December 2008, ordered 13 government agencies, including MWSS to clean-up, rehabilitate and preserve Manila Bay, to restore and maintain its waters to SB level (as per DENR Administrative Order No. 34) fit for swimming and other forms of contact recreation.

Provide, install, operate and maintain the necessary adequate waste water treatment facilities in Metro Manila, Rizal and Cavite to ensure that water being discharged from sewerages to Manila Bay passes effluent standards.

Submit to the Court a quarterly progressive report of the activities undertaken based on the Mandamus.

As one of the Mandamus agencies, the Supreme Court ordered MWSS to:

Compliance of MWSS with themandamus as contained in the Operational Plan for the Manila Bay Coastal Strategy (OPMBCS) 2017-2022 were reported, to wit:

Treated wastewater discharged into Manila Baycomplies with effluent (General Effluent Standard) and/or ambient water quality with the water quality guidelines;

More than 16 million population served in NCR and Region IV-A with average water coverage at 94%, sewerage coverage at 17% and sanitation coverage at 20%. Non-revenue water averages at 25%, from 61% in 1997;

Submitted quarterly accomplishment reports (consolidation of Manila Water and Maynilad reports) to Supreme Court, DENR EMB, DENR MBCO and DENR Region IV-A.

Attended Senate/Congress Committee meetings and technical briefings for MWSS’ presentation of accomplishments in relation to Manila Bay;


Participated in inter-agency events/activities such as :

Technical and Public Hearing of Senate Committee on Environment & Natural Resources

Technical and Public Hearing of Committee on Metro Manila Development of the House of Representatives

Technical Committee Meeting for the Manila Bay Sustainable Development Master Plan of NEDA

Manila Bay Technical Working Group (TWG) Consultative Workshop

Manila Bay Site Coordinating Committee meetings of DENR-NCR and CALABARZON

Liquid Waste Management Cluster Meeting of Manila Bay TWG

Refresher Course on Environmental Laws in connection with the implementation of OPMBCS 2017-2022

MBCRPP LGU Compliance Assessment Program of DILG

Malinis at MasaganangKaragatan Program of DA BFAR

Manila Bay Coastal Clean-Up Operation

San Juan River System Water Quality Management Area Governing Board Meeting and Action Planning Workshop

Malabon-Navotas-Tullahan-Tinijeros River System Water Quality Management Area Governing Board Meeting and Action Planning Workshop

Las Piñas-Parañaque River System Water Quality Management Area Governing Board Meeting and Action Planning Workshop

Developed the Data Book on Water, Sewerage and Sanitation in partnership with Manila Water and Maynilad; and

Collaborated with Concessionaires Maynilad and Manila Water for other accomplishments outside of the Key Performance Indicators (KPI),mainly to raise awareness relative to Manila Bay such as:

Manila Water’s LakbayanToka-Toka 2018 and environmental exhibits, events and clean-up drives

Maynilad’s Public Consultations, Plant for Life Program, media releases, educational campaigns, community briefings, educational tours and plant visits.

In coordination with Concessionaires Manila Water and Maynilad, MWSSwill continuously work to bring backthe once splendid reputation of Manila Bay by restoring its beauty and ambience to its pristine beginnings.


MWSS-CO LAUNCHES THE 2018 CARRIEDO CUP INTER-AGENCY SPORTSFEST

After almost 20 years since the last Carriedo Sportsfest took place, MWSS-CO, as hosting agency, launched the 2018 Carriedo Sportsfest on 12 January 2018. The momentous event which aimed to promote camaraderie and work-life balance among employees of MWSS, its Concessionaires, and agency-lessees at the MWSS complex was scheduled in time for the commemoration of the 140th MWSS Founding Anniversary on 14 February 2018.

Under the leadership of Administrator Reynaldo Velasco, the MWSS’ organizing committee led by Ronald Abrigo, Atty. Anabella Altuna and Engr. Nestor Lualhati gathered affiliated/ tenant agencies together for an amiable inter-agency competition sporting event. The participating agencies were MWSS Corporate Office, MWSS Regulatory Office, Maynilad Water Services Inc (MWSI), Manila Water Company Inc. (MWCI), Local Water Utilities Administration (LWUA), Office of the Government Corporate Counsel (OGCC), Luzon Clean Water Development Corporation (LCWDC), National Anti-Poverty Commission (NAPC), Northrail, WASSSLAI, WASSECO, Catalina Agency and Bessang Pass.

After two months of meetings and discussions where the rules and regulations and sporting events were finalized, the Sportsfest was launched featuring the games of lawn tennis, darts, practical shooting, golf, chess, sungka, bowling, basketball, badminton and photography.


The inter-agency competition ran for almost two months while the games were held on various locations inside and outside of MWSS premises. Finally, on 9 March 2018, the Sportsfest’s awarding ceremony was held. Attended mainly by all participating agencies, the ceremony was highlighted by the passing of the baton to the next host in 2019, the Manila Water Company Inc.

The final results were as follows (based on overall team rankings):

AWARD PARTICIPATING AGENCYChampion OGCC1st Runner Up LWUA2nd Runner Up Manila Water

SPORTLawn Tennis

AWARD PARTICIPATING AGENCYChampion Manila Water1st Runner Up LWUA2nd Runner Up Maynilad

SPORTDarts

AWARDChampion1st Runner Up2nd Runner Up

PARTICIPATING AGENCYMWSS-COMaynilad MWSS-RO

SPORTPractical Shooting



PARTICIPATING AGENCYMWSS-COMWSS-ROOGCC

SPORTSungka


PARTICIPATING AGENCYMaynilad Manila WaterMWSS-CO

SPORTChess


PARTICIPATING AGENCYManila WaterMayniladMWSS-CO & MWSS-RO

SPORTGolf


PARTICIPATING AGENCYManila WaterLWUAMWSS-CO, MWSS-RO, LCWDC, OGCC, Northrail

SPORTBadminton



PARTICIPATING AGENCYMayniladManila WaterBessang Pass

SPORTBasketball

Men’s DivisionChampion1st Runner Up2nd Runner Up

PARTICIPATING AGENCYManila WaterMWSS-ROMWSS-CO

SPORTBowling


PARTICIPATING AGENCYMaynilad MWSS-COManila Water

SPORTPhotography(Open Category)

Women’s DivisionChampion1st Runner Up2nd Runner Up

PARTICIPATING AGENCYManila WaterMayniladMWSS-RO


MWSS RECEIVES CERTIFICATE OF COLLABORATION FROM THE OFFICE OF THE CABINET SECRETARY (OFFICE OF THE PRESIDENT OF THE PHILIPPINES)

MWSS-CO and RO received a Certificate of Collaboration from the Office of the Cabinet Secretary (Office of the President of the Philippines) on 19 June 2018, for the successful compliancesof both offices of the requirements for collaboration in the implementation and operation of the 8888 Citizen’s Complaints Hotline. The compliance includes designation of focal and technical persons, attendance in the orientation and simulation seminars and enrollment of the agency’s online account with the 8888 Hotline system. MWSS is the first GOCC to receive the compliance certificate.

Conferring the certificate was Mr. Dale Cabrera, Undersecretary for Strategic Action and Response Office for Office of the Cabinet Secretary,whichwas received by MWSS AdministratorReynaldo Velasco, Mr. Ronald Abrigo of MWSS Corporate Office and the representativesfromMWSS-RO.

The agency hopes to do its best to continuously improve its service for the public.


MWSS JOINS ANNUAL R.A.C.E TO SERVE FUN RUN 2018

A group of MWSS-CO employees joined the CSC Fun Run on 2 September 2018 at the Quirino Grandstand in Manila to kick-off the celebration of the 118th Philippine Civil Service Anniversary by the Civil Service Commission.

The activity aimed to remind public servants to always be responsive, accessible, courteous, and effective (RACE) in the performance of their duties as well as honor public servants who sacrificed their lives in the service of the Filipino people.

With the theme “Lingkod Bayani: Maka-Diyos, Makatao, Makabayan,” the month-long celebration was led by Civil Service Commission chairperson Alicia dela Rosa-Bala.


MWSS DONATES FURNITURE TO ELEMENTARY AND HIGH SCHOOLS

In time for the 2018 school year opening, MWSS-CO gave away some 80 tables and 60 chairs to Lagro Elementary and High School, San Rafael Elementary School (Rodriguez, Rizal), and Ipo Elementary School (Norzagaray, Bulacan) to show support to the less privileged schools in its service area.

The transfer of ownership without costs to schools was approved by the MWSS Board of Trustees through the recommendation of Administrator Velasco. The Property Management Department promptly took care of identifying the used wooden tables and plastic chairs for donation and of dispensing them to the said schools. At this time, three more schools - Casili, Malanday, and Catmon Elementary Schools (Marikina and Rodriguez, Rizal) - were identified as possible recipients of another round of donation of the same fixtures.

MWSS, aside from being the water agency of Metro Manila, continues to support the public in other ways, as its contribution to society in the name of corporate social responsibility.


PATUBIG SA ALBAY: MOBILE WATER TREATMENT PLANT ASSISTANCE

As part of its CSR, the MWSS together with Maynilad and Manila Water extended assistance to the residents affectedby eruption of the Mayon Volcano in Albay Province.

A team composed of MWSS, Maynilad, and Manila Water employees was sent to the affected areas bringing with them a mobile water treatment plant to supply drinking water to the residents. The team’s send-off ceremony on 5 February 2018 was spearheaded by Administrator Rey Velasco, together with MWSS Board of Trustees Chairman Franklin Demonteverde, Trustee Melchor Acosta, Trustee Merly Cruz, DA for Engineering and Operations Leonor Cleofas, Maynilad CEO Ramon Fernandez, Maynilad COO Randolph Estrellado, Manila Water CEO Geodino Carpio and Manila Water Group Director for Corporate Management Project Thomas Mattison.


COMMUNICATION AND KNOWLEDGE MANAGEMENT


MWSS HOLDS FIRST-EVER CULTURAL SENSITIVITY TRAININGThe MWSS-CO held its first ever Cultural Sensitivity Training at MWSS Bulwagan Hall together with the representatives of Manila Water Company, Inc. (MWCI) and Maynilad Water Services, Inc. (MWSI). The training, focused on Indigenous People’s (IP) culture training and was facilitated by the National Commission on Indigenous People (NCIP) aiming for participants to acquire basic knowledge of the IP’s culture and identity and become culturally sensitive bearers in the implementation of projects inside the ancestral domains of Dumagat and Remontado Indigenous Cultural Communities (ICCs) of Rizal and Quezon. This workshop was not just intended for the New Centennial Water Source - Kaliwa Dam Project (NCWS-KDP) but for all projects where MWSS interacts with ICCs.

The two-day interactive workshop started with a welcome message by MWSS Deputy Administrator (DA) for Engineering and Technical Operations Group Leonor C. Cleofas followed by opening remarks of Dir. Roberto L. Almonte, Regional Director for NCIP-Region IV. Subsequently, speakers such as Executive Director for NCIP Ed Rogelio Francisco Bantayan Jr., Dr. Angelica Caliba-Cachola, Ma. Theresa Santos, Dr. Carlos P. Buasen, Jr., Dr. Marie Grace T. Pascua delivered messages, and discussed expectation settings, understanding of IP, basics of culturally responsive projects and presented laws and concepts to familiarize the audience on IPs work and daily living routine.

The second day was marked by sharing on the culture of Dumagats and Remontados with resource speakers Conchita Calzado, Marcelino Tena, Marissa Villa, Angelo Sallidao and Joan Umli using interactive exercises to stimulate the audience and further enhance the learning experience.

Through respect, open-mind and compassionate attitude to the needs of cultural sensitivity, much could be achieved affirming the proposition that a culturally diverse populace could be diverse yet could act united towards national development.


Republic of the PhilippinesCOMMISSION ON AUDIT

Commonwealth Avenue, Quezon City

ANNUAL AUDIT REPORT

METROPOLITAN WATERWORKS ANDSEWERAGE SYSTEM

For the Years Ended December 31, 2018 and 2017

ON THE


METROPOLITANWATERWORKS AND

SEWERAGE SYSTEM

Notes to Financial StatementsFor the year ended December 31, 2018


The Metropolitan Waterworks and Sewerage System (MWSS), a government-owned and controlled corporation, was created under Republic Act No. 6234 which was approved on June 19, 1971 replacing the National Waterworks and Sewerage Authority. The System is an attached agency to the Department of Public Works and Highways. Its main objective is to ensure an uninterrupted and adequate supply and distribution of potable water for domestic and other purposes to its consumers at just and equitable rates. It also aims to provide sewerage and sanitation services to the public. MWSS owns and has jurisdiction over all waterworks and sewerage system of all the cities and municipalities of Metro Manila, and some municipalities of Cavite and Bulacan.

Because of the felt need for the government to adopt urgent and effective measures and to address the nationwide water crisis which adversely affected the health and well-being of the public, legislators passed into law Republic Act No. 8041, otherwise known as the National Water Crisis Act of 1995, implemented under Executive Order No. 286 dated December 6, 1995, which reorganized the MWSS. The passage of Executive Order No. 311 on March 20, 1996 encouraged the private sector’s participation in the operation of the facilities of MWSS and paved the way for its privatization.

Pursuant to a process of a competitive public bidding and selection, MWSS’ operations were privatized. Thus, on February 21, 1997, MWSS entered into a Concession Agreement (CA) with two private companies (Concessionaires), namely, the Manila Water Company Incorporated (MWCI) and the Maynilad Water Services Incorporated (MWSI), granting them the rights to manage, operate, repair, decommission and refurbish the Facilities in the Service Area, including the right to bill and collect for water and sewerage services supplied in the Service Area. MWCI operates on the east zone while MWSI services the west zone, the two concessionaires formally took over the operations of MWSS on August 1, 1997. In addition to the performance of the service obligations, the concessionaires are required, under the CA, to pay MWSS concession fees in consideration for such right.

1. GENERAL INFORMATION/ENTITY PROFILE


As a result of the privatization in 1997, MWSS is now divided into two Offices, the MWSS- Corporate Office and the MWSS- Regulatory Office.

On March 8, 2001, due to financial difficulties, Maynilad suspended payment of concession fees. From March 2001 to July 2001, MWSS used its own funds to meet the maturing obligations of Maynilad. Thereafter, from July 2001 to 2006, MWSS had to obtain a number of loans from various banks and financial institutions to meet its maturing obligations and expenses which the (unpaid) concession fees from Maynilad were supposed to cover.

Despite continuous negotiations, several disputes between Maynilad and MWSS led the former to issue a “Notice of Early Termination of the Concession” on December 9, 2002. On January 7, 2003, MWSS arbitration proceedings were commenced and on November 7, 2003, the Appeals Panel for Major Disputes ruled that (1) there was no MWSS or Concessionaire Event of Termination under Article 10 of the CA, (2) the parties should continue to perform their obligations under the CA until the expiration thereof, (3) MWSS may draw on the US$120 million Performance Bond. The Arbitration Order became final on November 22, 2003.


During the pendency of the corporate rehabilitation proceedings, and prior to the drawing on the US$120 million Performance Bond, MWSS had to seek funding from other sources to meet its maturing obligations and operating expenses. As a result, on March 16, 2004, MWSS with the Republic as Guarantor, and BNP Paribas, entered into a Subscription Agreement wherein BNP Paribas agreed to subscribe to the MWSS-BNP Notes.

On April 29, 2005, Maynilad submitted to the Rehabilitation Court its 2005 Rehabilitation Plan incorporating the terms and conditions of the Debt and Capital Restructuring Agreement (DCRA) executed between Maynilad, MWSS, Benpress Holdings Corporation, the Suez Group and other lenders. On June 1, 2005, the Rehabilitation Court approved the 2005 Rehabilitation Plan, including the DCRA.

Under Clause 2.6 of the DCRA, MWSS was given the right to subscribe to 83.97 percent of the shares of Maynilad. On September 8, 2005, the MWSS Board of Trustees resolved to assign the MWSS Subscription Rights pursuant to Clause 24 of the DCRA. After going through the process of competitive public bidding, DMCI-MPIC Water Company, Inc. (DWCI) was awarded the MWSS Subscription Rights and the right to acquire receivables of MWSS, subject to the conditions imposed under the DCRA. On December 27,2006, MWSS and DWCI entered into an Assignment and Assumption Agreement (AAA) to formalize the award.

In accordance with the AAA, DWCI, decided to effect the early exit of Maynilad from rehabilitation proceeding by contributing cash to the latter and enabling the latter to prepay, among others, its obligations to MWSS under the DCRA. To implement this, DWCI entered into a Prepayment and Settlement Agreement (PSA) with Maynilad, MWSS, the Suez Group and other lenders on August 9, 2007.


Thereafter, Maynilad, MWSS, the Suez Group, and other creditors of Maynilad filed a Joint Omnibus Motion dated August 14, 2007. Acting on the Joint Omnibus Motion, the Rehabilitation Court issued an order dated December 19, 2007 (1) immediately approving the PSA, (2) declaring that Maynilad had successfully implemented the 2005 Rehabilitation Plan subject to the fulfillment of certain conditions, and (3) disallowing the disputed or unresolved claims of MWSS and the Suez Group. On February 6, 2008, the Rehabilitation Court issued another order confirming the December 19, 2007 Order, declaring that the conditions in its previous order have been met, and releasing Maynilad from the corporate rehabilitation proceedings.

During the 11th year of the implementation of the Concession Agreement, the Parties, MWSS and MWCI and Maynilad (under a new Sponsor, DMCI) identified and discussed the option of renewing/extending the Concession Agreement pursuant to the following government policies:

To increase investments in water and wastewater improvement projects, to pursue the mandate of the government to accelerate waste water projects, to comply with the Clean Water Act and the recent Supreme Court decision for the cleanup and preservation of Manila Bay, and sufficient concession fees to support the implementation of new water source projects as enumerated in the Final Business Plan;

To mitigate the impact on tariff increases through the renewal/extension of the Concession Agreement

On October 19, 2009, the DOF transmitted to the MWSS, the signed letter of Consent and Undertaking in behalf of the Republic the approval of extension of the Concession Agreement of MWCI to an additional of 15 years from May 7, 2022 to May 6, 2037.

a.

b.


On March 17, 2010, the DOF thru the MWSS, again transmitted the signed Letter of Undertaking in behalf of the Republic another approval of 15 years’ extension of the Concession Agreement of the Maynilad from May 6, 2022 to May 6, 2037.

The Term Extension committed the Concessionaires to increase by 100 percent the concession fees (Corporate Operating Budget or COB) of the MWSS Corporate Office and the Regulatory Office.

On December 7, 2015, the MWSS issued a Notice of Award (NOA) to San Miguel Corporation – K Water Consortium for the Bulacan Bulk Water Supply Project. In accordance with the NOA, the Consortium registered the Luzon Clean Water Development Corporation as the newest concessionaire.

On January 15, 2016, the Luzon Clean Water Development Corporation entered into a CA with MWSS for the project. The CA is for a period of 30 years from signing date and may be extended as provided for in the CA. The project shall comprise of the supply of treated bulk water, planning, financing, development, design, engineering and construction of facilities including the management, operation and maintenance in order to alleviate the chronic water shortage and provide potable water needs of the Province of Bulacan.


In CY 2018, Rate Rebasing (RR) was performed which served as basis for reviewing the performance as well as to determine the new business plan that the MWCI and MWSI will undertake. The exercise will also ensure that notwithstanding the changes in the economic and operating assumptions, both concessionaires will be able to recover all its expenditures (Opex, Capex and Income Taxes), plus guaranteed rate of return. As such, the exercise will serve as one of the major drivers of tariff adjustments under the CA.

Section 9.2 of the CA provides that the Standard Rates for water and sewerage services shall be adjusted each year effective January 1 of each Charging Year. In accordance with (i) the Rate Adjustment Limit set forth in Section 9.2.1., (ii) the adjustment principles set forth in Section 9.2.2 and (iii) the procedures set forth in Sec. 9.2.3.

Rata Adjustment Limit (RAL) is defined as the percentage, either positive or negative, equal to the sum of “C” or the percentage change in the Consumer Price Index, “E” or Extraordinary Price Adjustment and “R” or the Rate Rebasing Convergence Adjustment.

On May 25, 2017, after two failed biddings, the MWSS BOT issued Resolution No. 2017-056- RO that approved the Revised Terms of Reference (TOR) for the procurement services for the 4th RR and its Approved Budget for the Contract (ABC) amounting to P64,664,320.00 using the alternative method of procurement, Negotiated Procurement – Two Failed Biddings.

On August 31, 2017, only Test Consults, Inc. in joint venture with Constantino Guadalquiver & Co. (TCI/CGC) submitted its bid. After the procurement process, the MWSS BOT issued Resolution No. 2017-122-RO dated September 14, 2017 that awarded the contract for the consultancy services for the 4th RR (Contract No. RO-CS2017-001) with a total cost not exceeding P64,555,904.00 to TCI/CGC.

CY 2018 RATE REBASING


Year 01 Jan 2019 01 Jan 2020 01 Jan 2021 01 Jan 2022

Php/cu.m. 0.00 2.00 2.00 0.76

MANILA WATER COMPANY, INC. (MWCI)On September 24, 2018, MWSS RO recommended to the MWSS BOT, among others, for Manila Water Company, Inc. the implementation of partial “R” on a staggered basis as scheduled below:

On September 27, 2018, as recommended by MWSS RO, the MWSS BOT issued Resolution No. 2018-145-RO for RR determination for Manila Water Company, Inc. for Charging Years 2018 to 2022.

MAYNILAD WATER SERVICES, INC. (MWSI)On September 7, 2018 after months of audit, series of meetings and consultations, the MWSS RO recommended to the MWSS BOT, among others, for Maynilad Water Services, Inc. the implementation of partial “R” on a staggered basis subject to the decision by the Supreme Court of the case docketed as G.R. No. 239938, to wit:

Year 01 Jan 2019 01 Jan 2020 01 Jan 2021 01 Jan 2022

Php/cu.m. 0.00 1.95 1.95 0.93

On September 13, 2018, as recommended by MWSS RO, the MWSS BOT issued Resolution No. 2018-136-RO for RR determination for Maynilad Water Services, Inc. for Charging Years 2018 to 2022.


SOURCES OF FUNDS STRATEGIC INITIATIVES AND WATER SECURITY LEGACY BUBBLE

Water Security Legacy (WSL) Roadmap

– MWSS is driven by the Water Security

Legacy Roadmap and is composed of seven

legacies to help ensure a more holistic, long-

term and sustainable approach to water

service for Metro Manila and its outskirts.

These legacies are:

The following are the sources

of funds of MWSS:

A. Concession fees collected;

B. Rentals on leased properties;

C. Interest income on investments;

D. Loan availments from foreign and domestic

financial institutions;

E. Collection of raw water and accounts receivable; and

F. Other incidental revenues

A. Legacy 1 – Water Resources and Infrastructure Management, Development and Protection

B. Legacy 2 – Water Distribution Efficiency

C. Legacy 3 – Sewerage and Sanitation Compliance

D. Legacy 4 – Water Rates Review and Rationalization

E. Legacy 5 – Organization Excellence

F. Legacy 6 – Partnership Development

G. Legacy 7 – Communication and Knowledge Management


a.

Strategic Initiatives – MWSS–CO hereby commits to undertake the following key programs and/or projects identified as having a significant impact on its Performance Scorecard :

Strategic Initiative 1 – New Centennial Water Supply Source Project (NCWSP) - Kaliwa Dam Project (P12.2 billion)

Fund Source: Official Development Assistance (ODA) - China

Involves the financing, design and construction of a raw water supply source with a capacity of 600 MLD, through the commissioning of the Kaliwa Dam, including intake facilities and other pertinent facilities.

Part of the Project is a water conveyance tunnel intended to supply 2,400 MLD of raw water for Metro Manila, thereby reducing heavy dependence on the Angat Dam reservoir.

Status:

1. Notice of Award was issued on December 11, 2018 to China Energy Engineering Corp. Ltd. (CEEC) for the Detailed Engineering Design (DED) and construction works;

2. Notice of Award was issued on November 21, 2018 to the Joint Venture of EDCOP, PRIMEX and SMEC for the consultancy services;

3. Loan Signing was done on November 20, 2018 during the state visit to the country of China President Xi Jinping;

4. Ongoing negotiation with lot owners for the Tunnel Outlet Portal;


5. Ongoing coordination with the ff. agencies :

RDC Region IV-A - endorsement granted on November 2018 NCIP Region IV-A - for the FPIC EMB-Central - for the ECC DENR IV-A - for the ECC of the access road to the dam site.

6. On-going construction of access roads by DPWH

Access road to dam site (12 kms.) – 25 percent accomplishments and Access road to Tunnel Outlet Portal (8.87 km.) – 56 percent accomplishment


Strategic Initiative 2 – Bulacan Bulk Water Supply Project (BBWSP) (P16.32 billion)

Funding Source: Private Proponent under PPP scheme

Aims to provide clean and affordable treated water, will be implemented in three stages, covering 24 water service providers (WSPs) serving 21 municipalities and three cities in Bulacan.

Involve the development of surface water source facilities and new groundwater sources; provision of water treatment facilities and lift and booster pump stations; and the installation of new conveyance/transmission lines, among others.

Status: On-going construction works (water treatment plant and pipeline conveyance facilities) with an actual over all physical accomplishment of 96.233 percent.

b.

Strategic Initiative 3 – Angat Water Transmission Improvement Project (AWTIP) (US$133.98M)

Funding Source: Loan and GOP counterpart funded by Concession Fees Aims to improve the reliability and security of the Angat raw water transmission system through the rehabilitation of existing conveyance and appurtenances from Ipo Dam to the La Mesa Treatment Plant. Involves the construction of an additional tunnel, which will allow the alternate closing of older tunnels and aqueducts in the conveyance system. This will enable the conduct of necessary inspection and rehabilitation of portions of the systems without interrupting the transmission of water.

Status: On-going construction works at 84.48 percent physical accomplishment; TBM Excavation: 5,939 linear meters to date; and Tunnel Concrete Lining: 5,969.40 linear meters out of 6,400 linear meters or 93 percent accomplishment to date.

c.


Strategic Initiative 4 - Angat Dam and Dykes Strengthening Project (ADDSP) (P5.719 billion)

Fund Source: Angat Hydropower Corporation (AHC) for the strengthening works of the dam and dyke; National Government for the dam instrumentation and flood protection works. Involves the strengthening of the dam/dyke & auxiliary spillway, installation of flood forecasting and warning system on dam operation and flood protection works to ensure structural integrity of the dam and dyke and to increase dam storage capacity.

Aims to mitigate risks as a result of the dam being on the West Valley Fault. It will include the installation of flow forecasting and warning systems beneficial to downstream towns and cities.

Status: As of December 31, 2018, the strengthening works and flood protection works is 100% completed. Strengthening works was undertaken by Hanjin, the contractor engaged by AHC while the Dam Instrumentation was implemented by NPC as per the MOA. On the other hand, the dam instrumentation works is 95% completed with five out of seven contract packages already completed. This is being implemented by NPC as per the MOA.

d.


Strategic Initiative 5 - Rehabilitation, Operation and Maintenance of MWSS-owned Auxiliary turbines 4 and 5 of the Angat Hydro-Electric Power Plant (AHEPP)

Funding Source: Private Proponent under PPP Scheme The Project involves the opportunity to optimize the benefit from the MWSS-owned auxiliary turbines 4 & 5 by developing the hydropower generation component, a “by- product” of water releases. Status: On-going preparation & discussion by the Inter-Agency Technical Working Group (MWSS, DOE, NPC, and PPP Center) on the proposed water and asset sharing agreements with Angat Hydropower Corp. (AHC, the AHEPP owner/operator). These agreements, once finalized, will be discussed/agreed with AHC, and will form part of the bidding documents.

e.


Strategic Initiative 6 – Sumag Diversion Project

Funding Source: Concessionaire’s Fund through the Common Purpose Facility (CPF) Aims to provide additional raw water (188 MLD) from Sumag River in Gen Nakar, Quezon which will be diverted to Umiray Tunnel to augment water supply in Angat Dam. The proposed project involves the construction of appurtenance structures of Tyrolean Type Weir, Intake, Desilting Basis with Sluice Way, Transition Channel, Cut and Cover, Tunnel (600 linear meters with 2.70 meters’ diameter), Open Channel and Intrasite Access connecting to the UATP.

Status: This Project is being implemented and funded by the Common Purpose Facility (CPF) Office of the two (2) concessionaires (Manila Water and Maynilad). The Project has not yet resumed as of this date considering that the Provincial Mining and Regulatory Board, Province of Quezon has yet to issue the necessary quarry permit. MWSS/CPF sent the application for quarry permit last February 15, 2017. A letter dated September 3, 2018 was also sent by the CPF Office to follow-up on the status of said application.

f.


Rehabilitation of Umiray Facilities Funding Source: Concessionaire’s Fund through the Common Purpose Facility (CPF) Rehabilitation and strengthening of existing tunnel structures/facilities to withstand future typhoons in order to ensure the continuous flow of raw water from the Umiray River to the Angat Reservoir. Status: This Project is being implemented and funded by the Common Purpose Facility (CPF) office of the two (2) Concessionaires (Manila Water and Maynilad). The construction works which resumed last January 4, 2018 is on-going at 62.40 percent accomplishment.

g.

Strategic Initiative 7 – MWSS Reorganization

MWSS Corporate Office (CO) has an approved Reorganization based on Governance Commission for GOCCs (GCG) MC 2013-17. The process started late 2017 and placement of positions to the new Organizational Structure set up is being implemented. As of December 31, 2018, 89 out of 128 plantilla positions were filled up, while 23 employees who availed of the Early Retirement Incentive Program (ERIP) were paid. The MWSS-CO has a pending request for additional positions that is currently being assessed by the GCG.

h.


Strategic Initiative 8 – Customer Satisfaction Survey

The ultimate customers of both MWSS and Concessionaires are the general public to whom it serves potable water and sewerage and sanitation services in its service area. This is a system for obtaining feedback from our direct customers. The latest study conducted by the UP-CIDS for 2018, which was completed December 2018, was presented to the MANCOM on January 2019.

i.

Board Resolution No. 2019-063-CO dated April 23, 2019 authorized the issuance of the Financial Statements of MWSS pursuant to Section 8 (g) of Republic Act No. 6234, the MWSS Charter.


CORPORATEINFORMATION

METROPOLITAN WATERWORKS ANDSEWERAGE SYSTEM

4th Floor, Administration Building, MWSS Complex,

489 Katipunan Avenue, Balara, Quezon City, 1105

Trunk Line : 920-55-21 local Nos. 102 & 103

http://mwss.gov.ph/

Email Address: [email protected]

Filing of complaints/feedback may be filed during office hours from Monday to Friday, 7:00 am to 6:00pm, through the following contact details:

POLICY, PLANNING AND PUBLIC RELATIONS DEPARTMENT (PPPRD)

Ms. ELENITA S. DE LEON

Customer Service Relations Specialist

Direct Line : (02)433-39-87

E-mail: [email protected] ; [email protected]

PREPARED BYPOLICY, PLANNING AND PUBLIC RELATIONS DEPARTMENT (PPPRD):

Ronald S. AbrigoSusanne S. Sta. Maria

Elenita S. De LeonRestituto G. Espejo IIIRosalinda D. BandojoRosaida C. Barranta

report 2018 · 2019. 10. 14. · sapat na daloy ng tubig; serbisyong tunay community vision for its...

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