Thursday, July 27, 2017

$10M Already Disbursed to Fiscal Board

By on October 12, 2016

SAN JUAN – Gov. Alejandro García Padilla left Wednesday for New York City, where on Friday he will present Promesa’s fiscal control board a draft of his 10-year fiscal plan for Puerto Rico. He will also hold meetings with members of his fiscal team and advisers, La Fortaleza announced Wednesday.

During the board’s second official meeting, the governor and his fiscal team will present the latest version of the document, which is still unfinished, and answer questions from members of the new governing body. According to the press release, García Padilla will seek to “establish which government items should not be affected, in benefit of Puerto Ricans.”

Although no details on specific changes to the draft have been offered, it is expected the island’s fiscal gap will exceed the figures previously announced by the administration.

“It’s a conversation, face-to-face, where [the board] is given the opportunity to know what happened, what the history has been, how the debt was issued and what measures are being taken to address it toward the future,” Justice Secretary César Miranda told Caribbean Business after a meeting at La Fortaleza on Tuesday, where the fiscal team discussed the plan.

Although Office of Management & Budget (OMB) Director Luis Cruz admitted that a larger than anticipated fiscal gap “was mentioned,” during Tuesday meeting officials didn’t comment on the contents of the draft that will be presented Friday.

Secretary of State and director of the commonwealth’s new fiscal agent Víctor Suárez, Chief of Staff Grace Santana, Treasury Secretary Juan Zaragoza and Cruz will make the trip to New York. Miranda will stay on the island to serve as acting governor.

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Secretary of State Víctor Suárez, Gov. Alejandro García Padilla and Chief of Staff Grace Santana

The meeting will be held on the 20th floor of the Metropolitan Transportation Authority headquarters, at 3 Broadway Street. It is scheduled to begin at 8:30 a.m.

The board will also announce how the 25 public entities placed under its immediate watch, along with the central government, will move forward as covered instrumentalities. According to a Tuesday press release,“additional fiscal plans” for these entities will be requested, but offers no further details regarding the extent of this petition.

$10 million disbursed to date

A total of $10 million have been disbursed to date to the board for its operational expenses, with funds coming out Puerto Rico’s coffers, as required by Promesa.

“What Promesa mandates is to allocate–and we have been doing so–$2 million monthly in funds for the board,” OMB’s Cruz told Caribbean Business, as he explained that the disbursements for June, July, August, September and October have been complied with.

The federal statute requires the government of Puerto Rico to disburse the funds no later than the fifth day of each month. It also calls for providing a permanent revenue source for the board, not subject to legislative appropriations. The board may, at its discretion, return funds it doesn’t use to the Puerto Rico government.

Meanwhile, both Cruz and Miranda claimed not to know where the board’s offices will be located on the island, as required by Promesa, nor whether there had been a request made to the local government to this end.

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