Wednesday, January 20, 2021

Puerto Rico Gov Blames Island’s Problems on D.C.’s ‘Inequitable Policies’

By on April 29, 2020


In Reply to Sen. Grassley, Vázquez Blasts ‘Unfounded Allegations’ of Malfeasance, Corruption

SAN JUAN – In a letter responding to Republican Sen. Chuck Grassley’s criticism of her handling of the Covid-19 crisis and alleged corruption cases in Puerto Rico, Gov. Wanda Vázquez Garced blames Washington, D.C. for “inequitable policies” that have “exacerbated” economic and social problems on the island, and contends that her policies have been effective in curbing the spread of the novel coronavirus locally.

In the letter, dated April 27, Vázquez attributes Grassley’s “unfounded allegations” to “individuals with a personal agenda who seek to tarnish Puerto Rico’s reputation.” She contends that her administration has “doggedly addressed” issues related to irregularities in the use of federal funds and has “diligently” ensured that relief is utilized for “the maximum benefit of the people of Puerto Rico.”

She also criticized the Financial Oversight & Management Board (FOMB) for continuing “to engage in unnecessary letter writing campaigns while creating delays and inefficiencies that could easily be resolved with a phone call.”  

While acknowledging the federal government has “significantly increased” funding for Puerto Rico’s health system to fight the Covid-19 epidemic, the governor stressed, however, that “a fundamental limitation for Puerto Rico as it seeks to address its multiple overlapping crises (economic, fiscal, demographic, political exigencies as well as natural disasters and pandemics) is that its territorial status allows for structural inequalities between Puerto Rico and the states.”

Vázquez cited a Dec. 20, 2016, report by the Congressional Task Force on Economic Growth in Puerto Rico, which identified several instances in which the island is “subject to unequal treatment under federal programs,” particularly involving health funding and benefits and tax credits to the island’s working poor.

“As you are aware, given Puerto Rico’s territorial status, Congress has the right to disparately treat U.S. citizens on the Island under multiple federal laws, programs, and other policies (such as Medicaid, Medicare, nutritional assistance, child tax credit, and the earned income tax credit) – and Congress does in fact do so,” the governor wrote. “These inequitable policies lead to an overall quality of life in Puerto Rico that is below the standard in the states in multiple respects.”

Vázquez says in her letter that this “disparate quality of life” is the main cause of Puerto Rico’s ongoing population loss, which she notes has been “detrimental” to the island’s tax base, labor force, consumer demand, debt repayment capacity, and overall prospects for economic growth.

“Although it is true that the federal government has increased its financial support for U.S. citizens in Puerto Rico in recent years, the fact remains that U.S. citizens living in Puerto Rico are still not receiving equal treatment under the law as compared to those living in the states,” she says in the letter.

Vázquez released the eight-page footnoted letter to the press but reportedly did not divulge the pages of evidence sent to Grassley on the ongoing investigation of alleged irregularities involving the purchase of Covid-19 testing kits costing several million dollars.

In an April 20 letter to Vázquez, Grassley, who is the chairman of the Senate Finance Committee, inquired about what his office called “questionable contracts and potentially wasted relief money related to the fight against COVID-19 and other disasters” on the island.

“It appears that procurement and contracting in Puerto Rico often passes through a filter of political connections before resources intended for the people of Puerto Rico actually reach them and achieve the intended use, depriving the people of Puerto Rico the primacy that they deserve,” Grassley wrote in his letter.

He was referring to the purchase of rapid Covid-19 tests, as well as related issues including “the recent resignations of health officials, the decision to use contractors with no prior experience in medical supplies for COVID-19 tests, the potential political considerations made in that decision-making process, the lack of notifications to the Financial Management Oversight Board regarding these large purchase orders or contracts and the ‘discovery’ of $3-$4 million worth of medicine expiring under the control of the Puerto Rican health department.”

The senator from Iowa wrote in his letter that Puerto Rico has engaged in widespread “hoarding and politically based allocations” of federal relief funds.

However, in her letter, Vázquez says Grassley’s letter has “misstatements, mischaracterizations and inaccuracies that do not accurately reflect the manner in which this administration has governed and taken critical measures to assure utmost compliance with the rule of law.” She called the senator’s allegations “troubling,” adding that they “come at a time of great distress in Puerto Rico and the world, when precious time and resources should be used to address our collective humanitarian crisis.”

The governor contends in her letter to the senator that her decision to implement the March 15 curfew/lockdown, which is still in place, “halted the tide of the novel coronavirus and saved hundreds if not thousands of lives.”

“[I]n the face of the unprecedented global crisis brought on by COVID-19, this administration has been laser focused on preserving the health and safety of the U.S. citizens of Puerto Rico and assuring that we respond to this unparalleled challenge swiftly and effectively,” she wrote.

Vázquez addresses Grassley’s concerns regarding the commonwealth government’s contract procurement process for the use of federal funds to combat Covid-19—specifically alleged irregularities in the commonwealth Health Department’s attempt to purchase a million Covid-19 testing kits. She wrote that “investigations and reports are currently underway with respect to the contracts with 313 LLC and Apex General Contractors”—the two companies under investigation by the commonwealth Justice Department and the FBI for their participation in the aborted $42 million Covid-19 test kit transaction.

The governor informs the senator that information on the investigation has been included with the letter.

“We are providing all relevant information that does not compromise any pending investigation and, when the investigation is complete, we will share all information we are legally permitted to disclose,” she wrote. “My administration stands ready to continue productive engagement with the federal government and the Oversight Board to address our collective challenges posed by COVID-19. However, this administration will not stay silent, and will respond, in the face of false allegations that the Government has not acted in good faith or in a transparent manner.”

Citing allegations of irregularities is the use of hurricane relief funds in states such as New Jersey and the city of New Orleans, Vázquez contends in her letter that allegations of government impropriety are “the unintended consequences of fast tracking government procurement processes in the midst of a crisis.” The governor mentions statements made in February by Coast Guard Adm. Peter J. Brown, the Trump administration’s point man for natural disaster recovery efforts on the island, who said that the commonwealth government had “very strong internal control mechanisms to counter any attempts at corruption or diversion of funds.”

“Your letter undermines these efforts by spreading unfounded allegations that taint Puerto Rico’s reputation,” the governor tells Grassley in her letter. “The truth is that the only pending criminal case for corruption related to the allocation of Puerto Rico federal emergency relief funds involves federal administrators at Federal Emergency Management Agency (FEMA), not Puerto Rico officials.”

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