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Governor puts Puerto Rico power company’s retirement board under receivership

By on March 23, 2018

SAN JUAN — Gov. Ricardo Rosselló signed Friday an executive order that puts the Board of Trustees of the Puerto Rico Electric Power Authority (Prepa) Retirement System in receivership with the purpose of providing information needed to approve the actuarial reports and the system’s statements.

Public Affairs & Public Policy Secretary Ramón Rosario stressed in a statement that the relevant agencies have reported that, since January, the board has refused to approve the actuarial report and retirement system statements. As a result, the government has been unable to issue the audited financial statements for 2015.

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The governor signed the executive order under Act 5 of 2017, to “take those actions and decisions that are necessary to immediately finalize, evaluate, approve and/or sign the necessary documents, including the management representations letter of the Retirement System, for the final publication of the actuarial reports and audited financial statements of the Retirement System for the corresponding fiscal years, up to and including fiscal year 2017.”

In addition, the order seeks that retirement system information that would be needed to prepare the amended fiscal plan for Prepa or its budget for the fiscal year 2019 be delivered to the island’s Fiscal Agency and Financial Advisory Authority (Aafaf by its Spanish acronym).

Prepa is currently in the process of restructuring its debt, under Title III of the Promesa federal law. The utility is also in the process of preparing an amended fiscal plan, which will be submitted to the island’s fiscal oversight board for certification.

“In response to Prepa’s realities, this administration has announced the beginning of a process to make viable the transformation of our energy system to a modern, sustainable, reliable, efficient, and cost-effective one. In order to carry out these tasks in a responsible manner, it is necessary to have the most recent, accurate, updated, and audited financial information of Prepa, including all the units that comprise it,” the order reads.

Rosario added that the policy of the administration is to streamline the processes for issuing financial statements in order to regain government trust through transparency.

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