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Puerto Rico recovery office chief: Federal red tape delaying over 3,000 reconstruction projects

By on December 13, 2018

SAN JUAN – None of the 3,000 Puerto Rico projects contained in the Economic Development and Recovery Plan turned over to Congress in August have yet to be fully designed because of red tape imposed by the federal government, the head of the island’s Central Recovery and Reconstruction Office COR3), said Thursday.

In August, COR3 submitted to Congress its recovery plan, which states Puerto Rico needs $139 billion for reconstruction projects. The office’s director, Omar Marrero, said the projects, which involve water, energy, housing and infrastructure are still in the design stages.

Section 428 of the Stafford Act, which is the public assistance alternative procedures, requires local agencies to agree on a cost estimate for projects with the Federal Emergency Management Agency (FEMA) before drafting a project worksheet, or PW. The president signed Alternative Procedures (Section 428 of the Stafford Act) into law in January of 2013, three months after Hurricane Sandy, to allow FEMA to exert better control of assistance funds.

“There is no project worksheet. We have said that already. We have been working on the response phase and are making the transition to the permanent reconstruction phase. There are an estimated 3,000 projects,” he said.

Why the delay? “Our contention has always been that the process leading to the permanent works has been slow, bureaucratic, and so far today has not allowed the filing of projects,” Marrero told reporters during an Associated General Contractors luncheon. “The reconstruction of Puerto Rico could last 10 or 15 years,” he said.

Marrero said there are $80 billion in funds that have been identified for the reconstruction of Puerto Rico, which includes $60 billion in federal funds and the rest from private sources. Gov. Ricardo Rosselló recently went to Washington, D.C., to lobby for funds.

“The federal funds are there. The problems is we must comply with some processes that we do not control,” he said.

What can be done? “We have to continue to fight for it in Washington,” he replied.

Puerto Rico has received more than $19 billion in Community Development Block Grant (CDBG) program funds and about $8 billion in FEMA funds including for U.S. Army Corps of Engineers assignments.

Meanwhile, AGC President Stephen Spears also urged the federal government to repeal barriers that prevent local contractors from participating in project bids.

“Statistics show that as of September 2018, only 9.3 percent of the value of contracts went to local contractors, and the average value of the contracts to local firms is lower than the value of contracts to outside firms,” he said.

Marrero said Puerto Rico must follow federal guidelines in awarding projects but that if a local and outside firm are equally qualified for a project, the local one must be selected under the Stafford Act.

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