PRESIDENT Gloria Macapagal Arroyo’s family expects the Department of Agrarian Reform to approve within the next seven days or before she steps down from office their application to convert the 157-hectare family-owned Hacienda Bacan in Isabela, Negros Occidental from agricultural to industrial use.
The application, which will exempt Hacienda Bacan from coverage of the Comprehensive Agrarian Reform Program, was filed at the DAR central office at virtually the eleventh hour of her presidency on June 15, DAR sources said. It also goes against Arroyo’s promise to farmer-beneficiaries she will distribute Hacienda Bacan to them during her term.
Sources at the DAR said it would be almost impossible for DAR to act on the application in Arroyo’s remaining days as president given the lengthy approval process. These same sources said that it would more likely be a matter left to whoever incoming President Benigno “Noynoy” Aquino III appoints as agrarian reform secretary.
But the Arroyos’ lawyer Ruy Rondain told VERA Files that people at the DAR are “mistaken.” He said the application had been filed years ago and had just recently been consolidated at the DAR central office. “We had been waiting for resolution for quite sometime now,” Rondain said.
On whether DAR will be able to approve the application before June 30, Rondain said, “I’m hoping they will.”
Rivulet Agro-Industrial Corp., whose chairman is Negros Occidental Rep. Ignacio “Iggy” Arroyo, brother of First Gentleman Jose Miguel “Mike” Arroyo, has been representing the family in the DAR transactions. But CARP implementing agencies like the Land Bank had earlier refused to deal with Rivulet, saying the real owner was the First Gentleman—and, in effect, the President was co-owner—citing the sale of the property to him in 1994. The land title was transferred to Rivulet only on Feb. 14, 2008
The hacienda is supposed to be in the final stages of CARP coverage. The provincial agrarian reform office has a pending request with the provincial Register of Deeds to issue Certificates of Land Ownership Award (CLOA) to Bacan’s 67 farmer-beneficiaries. The Land Bank, meanwhile, has deposited P42 million as compensation for the property.
No one at the DAR central office wanted to be quoted for this story, but various sources there confirmed that the application was filed last week and that the department would have to “proceed with caution” on a controversial case that “everybody will be monitoring.”
For years, there had been talk of converting Hacienda Bacan for industrial purposes but no one could produce any application, and DAR officials repeatedly assured farmer-beneficiaries there was none pending.
In October 2005, the Isabela municipal council approved a resolution reclassifying Bacan from agricultural to agro-industrial as part of a six-year comprehensive land use plan. The provincial council approved a similar resolution later that year.
These resolutions, however, do not mean automatic conversion. According to then provincial agrarian reform officer Teresita Depeñoso, the Arroyos had to apply for land conversion themselves.
In April 2008, VERA Files reported that Iggy Arroyo was preparing to have Hacienda Bacan converted to industrial uses so he could jump on the biofuels bandwagon and plant jethropa that would produce ethanol. Bacan’s farmer-beneficiaries at that time had already been waiting more than 10 years for the property to be covered by CARP.
In an exchange of letters between Rondain and the Land Bank in June 2008, Rondain protested the valuation of the land which was being done in preparation for payment to the landowners, and said, “Please be advised that in October 2007, Rivulet applied for the conversion of Hacienda Bacan.”
Two days later, in response to Rondain’s claim of the existence of an application for conversion, Depeñoso certified that “DAR-Negros Occidental has no knowledge whatsoever as to the perfection of the filing of the Application for Land Use Conversion due the to the fact that it has not received any order or notice from the DAR Central Office to cease and desist from further processing the claim folder of Rivulet Agro-Industrial Corp.”
The farmer-beneficiaries had also checked with the DAR at that time and were given a certification that there was no existing application for land conversion on Hacienda Bacan.
For years, the farmer-beneficiaries, who belong to the peasant organization Task Force Mapalad, have been pressing various government agencies to finally enforce CARP on Hacienda Bacan. They even held rallies outside DAR, the Land Registration Authority and even Malacañang to call attention to their plight. After that series of rallies, Arroyo promised them she would have Bacan distributed.
In late 2008, the Senate Committee on Agrarian Reform summoned all parties involved in the Hacienda Bacan controversy. Senate Minority Floor Leader Aquilino Pimentel got both the Land Bank and the DAR to commit to speed up the process of distribution.
The Land Bank told the Senate hearing at the time that it had prepared P42.3 million as payment for the property.
Also in that hearing, DAR Secretary Nasser Pangandaman attested that there was no application for conversion, and therefore no legal obstacle to distributing the hacienda to farmer-beneficiaries.
“Secretary Pangandaman made a mistake,” Rondain said. “Ang gulo-gulo nga diyan sa DAR (It’s topsy-turvy at the DAR). They didn’t know there was an application pending at the provincial office.”
The DAR central office refuses to release a copy of Hacienda Bacan’s application for conversion, saying it is a confidential matter until the DAR reviews the documents submitted, declares them in order, gives the case a conversion order number and then schedules an ocular inspection.
Though Rondain said the application was pending at the provincial level, provincial agrarian reform officials do not seem to be aware of the application.
Provincial agrarian reform officer Felix Servidad told VERA Files his office had a photocopy of an application for conversion that was stamped received Aug. 21, 2008 and filed by Helen Gradiola, an accountant of Rivulet Agro-industrial Corp.
Five months earlier, the municipal agrarian office in Isabela issued a notice that Rivuelet had applied to convert Bacan’s 152 hectares from agricultural to industrial use.
In the copy in Servidad’s office, he said Rivulet was asking that 131 hectares of Bacan’s farmland be converted.
Despite having had that copy of the application, Servidad was unaware that an application for conversion was being processed. “It might be that it (the 2008 application) was not pursued,” said Servidad, who also could not identify at what DAR level the 2008 application was first filed and received.
As required by the rules on land conversion, Rivulet has put up a billboard at Hacienda Bacan announcing that it has applied for conversion. However, the billboard omits the date the application was filed, the date the billboard was erected, and the date of the ocular inspection.
In the two years since, no one had supposedly seen any application for conversion covering Bacan. That is, until last week at the DAR central office and this week at the DAR provincial office in Bacolod City.
At any rate, applications for conversion may be filed either with the DAR central or its local offices. “The process can start from central office, but they have to go down to the local level for ocular inspection,” Servidad said.
Rondain said ocular inspections had already been conducted as soon as the application was filed. But DAR sources said the ocular inspections had yet to be scheduled.
Under land conversion rules, a committee on land conversion within the Center for Land Use Policy, Planning and Implementation (CLUPPI), an agency under the DAR Office of the Secretary, is supposed to evaluate the documents the Arroyos will submit. Only after the documents are declared in order will DAR process the application, which will start with an ocular inspection of the property.
But the CLUPPI would first have to make sense not only of the tangled timeline concerning the supposed application for conversion, but also the web of ownership that the Arroyos have built around Hacienda Bacan.
The 157-hectare sugarland, originally owned by the parents of the First Gentleman, Lourdes Tuason Arroyo and Ignacio Lacson Arroyo, was put up for auction by the municipality of Isabela in 1994 after the family failed to pay more than four years’ worth of real estate taxes.
But Mike Arroyo bought it back for a measly P176,000, representing back taxes, ignoring the P1.04 million which was the town’s price tag for the property. Farmers’ groups called the sale illegal because CARP was already in force and the property should have been placed under CARP coverage.
It is Mike Arroyo’s name that appears on the Bill of Sale as having won the auction for Bacan, and as the property’s official owner.
Rivulet, meanwhile, is also a shareholder of La Vista Investments and Holdings Inc., which was formed in July 2008 and counts among its owners the Mike Arroyo’s siblings.
In June 2001, Iggy Arroyo sent the DAR a voluntary offer to sell (VOS), giving up the property to CARP for P300,000 per hectare. A letter by Rivulet’s assistant corporate secretary said the company approved the offer and that it was Iggy who would represent it. The Land Bank, however, refused to honor Iggy’s VOS, saying it was Mike Arroyo who was the owner.
No matter who owned the property, however, Bacan came under CARP coverage by 2005 as part of the government’s compulsory acquisition mode.
In a bid to facilitate the distribution of Bacan, then provincial agrarian reform officer Depeñoso wrote Iggy in August 2007, appealing for his help “to convince the First Gentleman, your brother, Atty. Jose Miguel Arroyo, to offer the subject landholding to the DAR-Negros Occidental under the Voluntary Offer to Sell (VOS) scheme.”
She added, “Covering the said landholding under the Compulsory Acquistion Scheme…will be our last recourse.”
In a Declaration of Trust he signed on Oct. 16, 2007, Mike Arroyo said he “purchased it as trustee of Rivulet Agro-Industrial Corporation, and I have and claim no interest in the property whatsoever.” But the land title was transferred to Rivulet only in February the following year.
The local DAR office has been having problems securing CLOAs to be distributed to farmers. One reason is that the provincial Register of Deeds said he had been threatened against issuing the titles to farmer-beneficiaries.
In a letter dated Dec.5, 2008, Negros Occidental Register of Deeds Romulo Gonzaga informed Pangandaman that he could not move to issue the titles because Rivulet’s counsel was still protesting CARP coverage over Hacienda Bacan. “The said counsel demanded from me not to proceed (with the) registration and threatened me (with) criminal, administrative and/or civil charges should I do otherwise.”
Rondain said he did fight Gonzaga and all others involved for proceeding with the valuation of Hacienda Bacan, which, he said, was not covered by agrarian reform.