# Davao City Awards Small Value Contracts

Davao City government awarded 11 contracts through negotiated small value procurement to GenCorp Industries Inc. in 2026, totaling approximately P7 million to P8 million out of the company's P34.216 million total contract value with the city. These awards bypassed public bidding processes, raising concerns about potential conflicts of interest involving the Vice President's business connections and the city's mayor, who is involved in related impeachment proceedings. The scrutiny highlights the importance of transparency and adherence to procurement regulations in local government contracting.

- Procurement professionals should note the risks associated with negotiated small value procurement, especially regarding conflict of interest and public perception.
- This case underscores the need for clear policies and oversight mechanisms to ensure fair competition and prevent potential ethical issues in local government contracts.
- Contractors should be aware that awards without public bidding may attract increased scrutiny and legal challenges, impacting contract stability.
- Agencies and vendors must consider the reputational and procedural implications when engaging in negotiated procurement methods at the local government level.

**Jurisdictions:** sled
**Industries:** Construction & Infrastructure
**Topics:** Regulatory Compliance
**Published:** September 28, 2026

### Government Entities
- Davao City Government
- Philippine Government Electronic Procurement System (PhilGEPS)
- House of Representatives
- Philippine Senate
- Impeachment Court

### Vendors
- GenCorp Industries Inc. (awardee)

### Key Quotes
> The respondent herself admitted that she is part of this corporation, then GenCorp should not be participating in the bidding of the city of Davao, which is headed by no less than the brother of the respondent Vice President.
> — Gerville Luistro, Lead Prosecutor, House of Representatives

> Is it wrong for an LGU (local government unit) to tap a contractor in which a sibling of the mayor has an interest?
> — Senator Risa Hontiveros

### Sources
- [The 11 contracts – awarded through “negotiated small value procurement” – accounted for roughly P7 million to P8 million of GenCorp Industries Inc.’s P34.216-million total contract value with the Davao City government. https://t.co/Mlu4YXvZm6 | via ONE News https://t.co/44KlU8set](https://x.com/PhilippineStar/status/2104715473015521284) - twitter-fed-procurement