Fiscal board member: Municipalities must make adjustments
PONCE, Puerto Rico – Fiscal oversight board member Ana Matosantos warned municipalities that they must make adjustments because, according to the fiscal plan, the central government would considerably reduce their fund allocations.
“The amount of money the central government can provide to municipalities will decrease in phases, but it begins with more than $100 million this year and it will decrease more than $300 million when the plan is completely implemented,” she said in a WPAB 550 radio and CyberNews interview.
She also said municipalities must increase tax revenue, as is the case with the central government, in order to allocate additional funds and comply with payments to the retirement systems.
The fiscal board member said the measure is necessary “to continue with retirees’ services and be able to pay those pensions, for there are some taxes from the central [government] and municipal coffers that increase.”
Among the revenue collection measures, Matosantos mentioned the property tax hike to compensate for subsidies municipalities won’t receive from the central government. She also recommended a study on every municipality to focus and identify essential services.
“We must see which are essential services… what is the current fiscal situation, where are they in budget terms, where are they in terms of spending, and what are their savings opportunities,” Matosantos said.