Alaminos Paper

A Novel Way of Financing 
 Local Development Projects 
 of The City of Alaminos, Philippines
 Home of the Hundred Islands

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Colayco Foundation for Education & The City of Alaminos, Pangasinan Alaminos Infrastructure Bonds (AIBs) or Alaminos Growth Bonds (AGBs) and Alaminos Delopment Corporation (ADC) C-Financials Proposed Structure Next Steps

Colayco Foundation for Education The City of Alaminos, Pangasinan




The Colayco Foundation for Education (CFE) is a non-stock non-profit organization dedicated to actively promoting “financial literacy” for the average income earners, overseas Filipino workers, and students. Our objective is to fill-in the dearth of public financial information, reach out to a bigger audience and spread the good news that financial independence is within everyone’s reach. This is our own little way of contributing to nation-building.

CFE is a publisher of books on personal finance. These bestseller books are authored by CFE Founder and Chairman, Francisco J. Colayco. These publications serve as a guide for every Filipino on how to save and grow their savings. CFE embarked on publishing DVDs on the same subject matter.

From the beginning of our mission in 2003, we have conducted over 300 seminars and workshops for government agencies and financial institutions, the armed services, trade and professional associations, business clubs, community groups, academic institutions, and top corporations in service, product and manufacturing industries. For overseas Filipino workers in the Far East, Middle East and Europe, we conduct regular seminars in partnership with private financial institutions, the Overseas Workers Welfare, Philippine embassies and workers’ associations. We provide our audience ways to manage their personal finances effectively by planning, wise spending, saving and investing.

The City of Alaminos, Pangasinan is the center for trade, commerce and education in Western Pangasinan. Although it is a young city, it has been identified as one of the growth centers in 
 Region I. Home to the world-
 famous Hundred 
 Islands National
 Park, Alaminos 
 has a wonderful
 opportunity to
 further its 
 development by 
 expanding tourism,
 trade and commerce.

The Alaminos city government headed by Mayor Hernani Braganza envisions Alaminos to be “a peaceful city, [with] well educated, healthy and God-centered citizens, sharing fully in a development, propelled by a competitive local economy anchored on ecotourism, agriculture, commerce and light industry, [and to serve] as the vibrant hub of Western Pangasinan and as a living showcase of a family oriented, environmentally-sensitive growth with equity.” A step towards achieving this vision is the creation of development projects with mechanisms that encourage active participation from Alaminos locals. The city government currently has three priority projects for which funding has been earmarked. These enhancements to the city’s infrastructure are sure to benefit Alaminians.

Transport and trade go hand in hand. With a good transport system, trade and commerce is sure to be enhanced. A main project of the city government is a terminal-market intended to be a hub of people and goods. The terminal will cater primarily to provincial buses. It will connect travelers to the various local transportation options in Alaminos. On the other hand, the market will showcase wares not only from Alaminos but also from Western Pangasinan, thus there will be many more goods available to buyers. Having the market side by side the terminal is also a way to keep transport costs down. Goods can therefore be bought potentially cheaper, than if the market were in another location. In addition with the terminal attached, buying from the market will be convenient for both residents and travelers.

Public health is another important area of concern. The city government would like to establish a hospital to cater to Alaminians. This hospital is envisioned to provide low-cost highquality healthcare. With the new hospital and dedicated medical practitioners, more patients can be accommodated in the whole of Alaminos whether for planned or emergency health needs. In this way, the city government safeguards its greatest resource-its people. A healthy Alaminian is a productive Alaminian. In the future, the hope is that this hospital will be a primary destination for healthcare in the whole of Western Pangasinan.

The education of young Alaminians is a top priority. The city government would like to establish a respectable tertiary education institution that offers high quality education and formation at affordable prices. The university will educate and train Alaminians in their chosen fields as well as in their responsibilities as citizens. It will also promote research which could be useful for the development of Alaminos. The university is envisioned to be the primary destination for tertiary education in Western Pangasinan. With well-educated residents of Alaminos, the city government is ensuring the city’s progress and influence in the province for years to come.

In line with Investment Promotion, Point 8 of the City’s 10 Point Agenda, these projects are potential avenues for growing wealth and private sector participation. The city government would like to use this opportunity to promote and provide alternative saving and investment vehicles to the citizens of Alaminos.

Alaminos Infrastructure Bonds (AIBs) 
 or Alaminos Growth Bonds (AGBs) 
 and Alaminos Development Corporation (ADC)

The Alaminos Infrastructure Bonds
 (AIBs) or the Alaminos Growth 
 Bonds (AGBs) is an investment 
 instrument conceptualized by the 
 local government of Alaminos. These
 instruments will be sold directly to the local inhabitants of Alaminos on a retail basis in units of P50,000.00 (or in lots of P100,000.00). In this way, if a project requires a total funding cost of P200,000,000.00, then 4,000 units (or 2,000 units) will be sold. Through the purchase of this unit, the citizens of Alaminos can exercise their civic duties at the same time the success of this novel financing instrument as well of the development projects will be an additional source of local pride.

A pre-requisite to this instrument is the establishment of the Alaminos Development Corporation (ADC), a corporate entity that may be into but not limited to development, project management, and arranger. The ADC will serve as the main proponent for development projects. The ADC will focus on the design and development of projects that will be of great benefit to Alaminos. 
 The ADC will identify a local bank to handle the actual implementation of the fund raising – instrument issuance, administration, record-keeping, regular repayment, and the like.

C-Financials

C FINANCIALS, a financial advisory company headed by Francisco J. Colayco, is pleased to offer its services to the local government of Alaminos. The principals of C FINANCIALS have a combined 100 years experience in the area of investment. As such, C FINANCIALS is an excellent partner in conceptualizing, managing and implementing this initiative. C FINANCIALS is ready to design the AIBs/AGBs to suit the needs and personality of Alaminos.

Proposed Structure

+ Hospital

+ University

3. Part-owner, part-lender

2. Lenders
 AIBs / AGBs  5% to 8% Interest

1. Equity-owners
 Participation Certificates  Dividends

Terminal

=

PhP200M 

Alaminos Development Corp. (ADC)
 Development | Project Management | Arranger

Next Steps

1. 

1. 

Working Committee
 The working committee is tasked to determine the best course of action in pursuing the proposed projects. It will commission a reputable research firm to do feasibility studies. Based on the findings they will draft a proposal of the project to be presented to stakeholders. The working committee is composed of representatives from the local government and independent consultants. The establishment of the working committee will formalize the engagement between CFinacials/Colayco Foundation and LGU-City of Alaminos. Feasibility Studies
 A reputable research firm will be commissioned to do feasibility studies on the three projects – terminal-market, hospital and university.  The study will determine the economic viability of the projects. It will determine the potentials and challenges of each project, its technical and organizational requirements and it will provide a financial overview. Thoroughly analyzing the proposed business, operations and financial models, is a necessary step in maximizing the success of the projects.

3. 

4. 

Presentation to Top Stakeholders / Community / Select Group (Cooperatives, LGUs, Chambers of Commerce)
 In any development project it is important to include the stakeholders and target beneficiaries in the various stages of the project. Their participation will engender in them a sense of local pride and nationalism, valuable in building community and sustaining development in the long run.
 Top stakeholders such as the various LGUs, chambers of commerce, cooperatives, representatives from major sectors, etc. will be convened. The working committee will then present the projects and its plans to the assembly in order to get their support, participation and feedback. 
 Establishment of ADC
 Serving as the main proponent of development projects in Alaminos, the ADC will focus on the design and development of projects that will be of great benefit to Alaminos.

The ADC will also be responsible for managing development projects from its conception and execution through to its evaluation stages. Lastly, the ADC will make the necessary arrangements to carry out the novel model proposed for financing development projects. The ADC, through a local bank will take charge of the fund raising – instrument issuance, administration, recordkeeping, regular repayment, and the like. 
 5. 

Seminar Roadshows
 To complement the LGU’s efforts at promoting citizen participation through the financing of development projects, the Colayco Foundation for Education will be conducting financial literacy seminars in Alaminos. Learning personal financial management is one of the best ways of creating and enhancing Alaminian’s saving culture. The goal of these seminars is to create awareness and motivate personal change in ones personal finances and its management and to introduce opportunities for investment in Alaminos.