Saturday, September 23, 2017

Puerto Rico governor enacts 4 special session bills into law



By on August 23, 2017

SAN JUAN – Gov. Ricardo Rosselló enacted Wednesday four of the five bills passed by the Legislative Assembly during the first extraordinary session that ended Aug. 10, which he called productive.

Of the five measures for which the extraordinary session was convened, the only one that has not been sent to the governor’s desk in La Fortaleza is House Bill 1164, which would guarantee the restructuring support agreement (RSA) between the Government Development Bank (GDB) and its creditors, which was reached consensually through Title VI of the federal Promesa law.

Specifically, Senate Bill 603, which creates the Act to Guarantee the Payment to Our Pensioners and Establish a New Plan for Defined Contributions for Public Servants, is now law.

The governor called the extraordinary session “productive,” in which five bills were approved, as well as the seven designations to the Democracy Commission and two members to the UPR Board of Trustees. (Courtesy)

The governor explained that this law creates the legal framework so that the government can guarantee payments to pensioners through the “pay as you go” scheme. With this system, the government makes pension payments from the general fund, according to the money available. For this purpose, $2 billion was allocated to the current budget.

“To leave things as they were would have resulted in that as soon as September, our retirees would not receive payment of their pensions, for which they worked decades in public service,” Rosselló said while assuring that the measure protects “100% of the benefits public servants have.”

The law also creates a Defined Contribution Plan, similar to a 401(k) plan, which guarantees the contributions of public servants, for in the future, benefits will not be paid by the retirement systems.

Another one of the bills was H.B. 1142, which increases from $2,500 to $3,000 taxes on adult gaming machines to add nearly $60 million to the Treasury to comply with the certified fiscal plan. Previously, legal loopholes allowed certain machines to pay only $100 for their licenses, a matter intended to be solved with this measure.

The bill establishes that children’s entertainment machines and others, such as pool tables, pay $300 for their licenses.

The governor also signed H.B. 1162 to make technical amendments to Act 30 of 2017, which creates the Puerto Rico Democracy Commission, to incorporate the results from last June’s political-status referendum. It also establishes that the commission’s members will not receive monetary compensation for their services.

Rosselló reminded that “we received this amendment recommendation from baseball superstar Iván Rodríguez so the expenses from the commission’s members are not paid for with public funds amid the government’s fiscal situation.”

Lastly, the governor signed H.B. 1162, which makes technical amendments to the Science and Technology Trust Act. This bill was returned to the Legislative Assembly and amended to give more autonomy to the trust.

“After a lengthy conversation with members from the trust’s board and its executive, Lucy Crespo, today we fulfill our promise to bestow the trust with a structure that responds more to academia and the private sector to promote economic development.”

With this law, the trust will now have two government officials instead of five. Likewise, the board’s successors will be appointed by members of the trust instead of the government to ensure more independence and expertise.

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  • Danno Girl

    Where can we find out more about the new Defined Contribution Plan – mandatory deduction? I think I read somewhere it will be 8.5% of employee’s wages. Will this be the same regulations as a 401K.. with the same limits and capped per payroll percentage amounts? Will additional information and rules be forthcoming? And when should the contributions begin?

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