Monday, September 24, 2018

Puerto Rico governor’s office denies partiality in ad contracts

By on July 18, 2017

SAN JUAN – Gov. Ricardo Rosselló denied Tuesday that donors or campaign assistants were receiving any favoritism when contracts, especially advertising ones, are awarded.

This is despite the fact that Chief of Staff William Villafañe confirmed that the ad agency that has been awarded the largest sum of money in contracts—KOI Arise and KOI Americas, of the same company—worked close to the New Progressive Party (NPP) during Rosselló’s campaign.

Both officials stated separately that the government has cut funds for advertising by 61%.

Villafañe said that in the first six months of former Gov. Alejandro García Padilla’s administration (2013-16), $54 million was invested in advertising and $62 million in the last six months. But in this administration, $24.2 million was allocated for these purposes in the first six months, “a reduction of 61%.”

Chief of Staff William Villafañe (Courtesy)

“There is no prize [in the awarding of contracts]…. Our administration has identified a problem area, which is excessive spending in the advertising area, and we have drastically reduced it, more than 50 percent, and after that, 74 percent [for fiscal year 2018],” the governor said during a press conference.

“This company [KOI] was participating in the elections process, but that’s not why it’s there. When making their proposals and presentations, they are familiar with the public policy that they want to communicate and that definitely gives them an advantage in experience, in terms of knowing the public policy of the administration,” Villafañe said.

The chief of staff confirmed that KOI has received 30 percent, or $7.5 million, of the total invested by the government in advertising. “It’s not that it has grabbed everything. There are multiple companies that have been involved in this.”

“It seems like a lot, but the advertising companies take 15 percent or 20 percent [of money]. Nearly 80 percent to 85 percent where [the money] goes is to communications, not the ad agencies,” Villafañe said.

The official defended advertising contracts for health campaigns, tax education, tourism promotion and lotteries. He explained that the money used is not only for the communications companies to subsist, but also to educate citizens.

“Specifically, the ‘representation or artistic advertising services’ line item, in the last administration, $453 million was spent. So far in our administration, about 5.3% has been contracted, and a significant reduction is projected. In terms of advertising spending by the central government and its corporations, in 2016 they had $24.4 million in contracts, while our administration has invested $14.4 for a 40% reduction,” Villafañe said.


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