…as CDA cries foul over measure

The Commonwealth Development Authority strongly objected yesterday to the proposed bill that aims to grant delinquent borrowers credit relief.

“This is condoning inefficiency, unfairness, and absolute neglect of one’s financial responsibility. This bill is baseless and totally senseless,” said CDA board member Tom Quitugua, chair of the board committee on development corporation.

“We are very saddened with the introduction of this piece of legislation. With all due respect to our lawmakers, that particular move is a slap in the face of people in the Commonwealth,” he added.

Quitugua noted that the Legislature seemed to be catering to a few “interest” group lobbying for credit relief.

“We are all public servants. We all have a responsibility to all people not just to a few people,” he said.

In all common sense, the board member, asked, “What do we do with good borrowers? They only come to the aid of ‘bad’ borrowers.”

The House of Representatives passed Monday Senate Bill 14-48, which seeks credit relief for delinquent borrowers, such as reduction of interest rates and effective condonation in certain circumstances.

While the bill recognized that the high rate of delinquency threatens the CDA’s loan programs, it also cited the unstable economic conditions that contributed to many borrowers’ inability to repay the loans.

“[The] CDA must make accommodations to assist these borrowers who are currently facing difficult and uncertain times and ensure the repayment of the loans,” it states.

The bill seeks to provide relief to delinquent borrowers who have loans administered by the CDA for at least five years.

Quitugua called on the public to speak up on the issue.

“We appeal to the good sense of our lawmakers to reconsider this measure. We also encourage the people to come forward and be heard,” he said. “What are we telling the people? It’s okay to borrow and not pay? This sends a very negative signal to the people,” the CDA official said.

Further, he said that the bill infringes on the authority of the Judicial Branch and on the autonomy of CDA.

The bill seeks to prevent the CDA from filing foreclosure or default collection proceedings—or any court proceeding—on any delinquent loan without first meeting with the borrower and making “good faith attempt” to resolve the outstanding indebtedness.

The CDA is pursuing collection from about 200 delinquent borrowers.

“We’ve been very aggressive with our collection campaign and borrowers have been communicating with us. All of a sudden, the Legislature comes up with this idea which would result in total loss for the CDA, for the government,” Quitugua said.