Sunday, September 23, 2018

Powers of P.R. Statistics Institute Uncertain

By on August 26, 2017

Editor’s note: The following article originally appeared in the August 24 print edition of Caribbean Business.

SAN JUAN — While debate continues in court over which Puerto Rico Statistics Institute (PRSI) board of directors has the last word on the entity’s decisions, Executive Director Mario Marazzi showed concern about the uncertainty caused by the lack of a governing body.

After a roundtable discussion held at PRSI headquarters, Marazzi explained that the weakened powers following Gov. Ricardo Rosselló’s dismissal of four board members included a blow to its quasi-judicial and quasi-legislative powers.

With these powers—as stated in the 2003 Puerto Rico Statistics Institute Act—the PRSI has the power to “monitor government agencies’ and private entities’ compliance with the public policy” of the statute.

Dr. Mario Marazzi-Santiago, executive director of the Puerto Rico Statistics Institute (SI) / File

“If we were to [file a complaint], we would be more timid; we wouldn’t file it, or if we did, which board would see the case and resolve it? I can issue a subpoena for information to any agency [and] maybe they will reply. [But if they fail to reply], which board of directors will see the case and decide whether the subpoena proceeds or not?” he asked.

The law states: “The Institute has the power to order the cessation of activities or acts in violation of any provision of this law or its regulations; conduct inspections and reviews; issue subpoenas for information; investigations and compliance audits; impose administrative fines; [and] holding public hearings,” among others.

“We are going to continue working, we have lots of projects, but we are limited and quite weakened in our ability to control other agencies’ statistical work,” said the executive director of the entity in charge of coordinating the production of government statistics.

The PRSI leadership crisis began in July when the Rosselló administration dismissed four members of its board of directors and appointed Planning Board President María Gordillo as the entity’s new leader.

Under this scenario, the PRSI filed a lawsuit against all members of its board, including those dismissed and appointed by the governor, so the court can decide who has the authority in law to make decisions for the entity. The Court of First Instance of San Juan will issue a declaratory judgment in the case.

The PRSI has experienced cuts in recent years and its current budget is just over $2 million. Economists such as José Alameda and Vicente Feliciano are among those who have defended the institute’s work. “Without the statistics, you cannot run the government ship, period. When we are in a crisis, like the one we are in, having a clear idea [of the situation] is important. We don’t know where we are going if we do not have up-to-date statistics and of the quality we need,” Feliciano said.

Overestimation in retail sales

During a roundtable to offer details on the new methodology for estimating the island’s retail sales, Marazzi said overestimation at InfoVentas made it possible to artificially inflate the soundness of the Sales Tax Financing Corp. (Cofina by its Spanish acronym).

“To the extent that [the retail sales report] could be used to market and sell more Cofina bonds, it has an implication since about $18 billion is included in the February 2017 fiscal plan,” he said, pointing out that the new methodology is more precise and seeks to not have this situation happen again.

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