Tuesday, January 31, 2023

Union Says Prasa Revitalization Bill May Lead to Rate Hike

By on March 11, 2016

SAN JUAN – Pedro Irene Maymí, president of the Puerto Rico Aqueduct & Sewer Authority’s (Prasa) Independent Authentic Union (UIA), told Caribbean Business that even though a House of Representatives-approved bill, which aims to revitalize the utility, does not consider a rate increase, an increase is possible.

Maymí explained that the union said: “The way this will work is that the authority will send the money to this new corporation that will be created to get money from the payment of the bond emission, and what is left over will be returned to the authority for its operational costs.

“In [Puerto Rico] we are suffering mass emigration, which obviously means fewer clients for the authority, and on top of the other problems, the authority has to provide service, for which it has hired private companies, but has not been able to solve the situation, and it seems to us that in the next one or two years, if Prasa does not make adjustments to the excessive contracts it has, mainly taking tasks from us and assigning them the private companies, in one to two years it will find itself in the same situation, without money, and it will not be able to continue issuing bonds, and obviously the money has to come from somewhere.

“Three years is a lot of time, and if the adjustments that need to be made are not made in less than three years [Prasa] will be in the same situation no matter what this law says, if it finally becomes law; it will have to justify and approve a rate increase.”

The labor leader criticized the misuse of funds during the drought Puerto Rico suffered last year.

“The drought caused [Prasa] to lose close to $70 million. A significant amount of that money was used for payment of overtime, in an illegal manner by [Prasa Director] Alberto Lázaro and the [utility’s] Governing Board to trust employees whose salary is over $100,000 and who are not entitled to be paid for extra hours, yet the payments were approved in violation of Act 76, and this reduced benefits for other workers. While this policy of misspending continues, the money will not be enough and there will not be a way to keep Prasa operating unless its rates are increased,” he added.

Another important issue is the collective bargaining agreement between the UIA and Prasa, since it expires next year and the union expects to renegotiate it.

“The bill, according to information given to us by various legislators, includes language to cover labor costs within Prasa but using the current bargaining agreement, so we have to see what happens from this moment forward. We have said Prasa will have to carry out bond issuances because there are some construction projects that are very costly, and Prasa does not have the money on hand.

“But it seems to me that this is an excessive bond emission, that some of the contracts that we have pointed, which were our duty, such as the operation of the ‘Supertubo,’ and that [Chairman] José Ortiz had begun the process of giving back to us, but Alberto Lázaro renewed the contract and those tasks continue to be in private hands, and while that policy continues…, and these are not capital improvements, these are daily jobs that are not given to the people who should be doing them and are carried out through contracts,” Maymí assured.

The revitalization bill now awaits the Senate’s approval.

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