THE CEBU City Council has approved a P10-million outlay for the city?s Sinulog Festival celebration in January next year.

But Vice Mayor Michael Rama has to ask the Commission on Audit (COA) again for an exemption of its circular banning expenses that pose a conflict of interest.

If none is granted by COA, which gave Cebu City a one-time exemption last year, Rama has to resign his chairmanship of the Sinulog Foundation for the organization to continue receiving aid from the city, said Mayor Tomas Osmeña.

?That is Mike Rama?s problem. If he has to resign, then he should resign,? Osmeña said.

To avoid directly donating the amount to the Sinulog Foundation Inc., which organizes the yearly festival, the P10 million would be for sponsorship of prizes awarded to the various Sinulog contests.

Last year, the COA passed a circular which enforces a provision of the anti-graft law.

It prohibits local government units and government agencies from providing financial assistance to people?s organizations and non-government organizations that have, as any of its incorporators, organizers, directors or officials, an agent or official of the government or anyone related to such a government employee by consanguinity or affinity to the fourth civil degree.

Rama is the chairman of the Sinulog Foundation as well as the presiding officer of the City Council that appropriated the fund aid.

When COA gave a one-time exemption for Cebu City to allow the local government to donate to the foundation for Sinulog 2009, the commission made it clear the agency, as a rule, does not grant exemptions.

Rama said he would visit the COA?s main office in Manila in the next two weeks to seek another exemption for Sinulog 2010.

The vice mayor said his goal was to make the exemption permanent through an amendment to the COA circular.