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  • Writer's pictureThe San Juan Daily Star

Fiscal board approves its version of FY 2025 budget

Robert F. Mujica Jr., executive director of the Financial Oversight and Management Board

By The Star Staff

The Financial Oversight and Management Board announced Monday that it certified its $33.3 billion fiscal year 2025 consolidated budget for the Commonwealth of Puerto Rico consisting of the $13.1 billion general fund budget, the $4.9 billion special revenue fund budget, and the $15.3 billion federal fund budget.

The general fund budget increases total spending by 3% from the previous fiscal year. It includes additional funding for social programs, including assistance for aging adults, support for mental health, early childhood resources, and prevention plans against violence. The budget also provides funding for critical services such as education, health, public safety, social welfare, and economic development.

“The fiscal year 2025 budget includes important investments in education, health, and infrastructure to support not only Puerto Rico’s recovery and economic growth but also the quality of life for all Puerto Rico residents,” said Robert F. Mujica Jr., the executive director of the oversight board.

The budget also includes provisions to control government spending outside the budget process. Spending bills or laws must identify how the government intends to pay for the cost of bills or laws.

“Budgets must be balanced, and a budget is not only balanced at the beginning of the year but must remain balanced throughout the fiscal year,” Mujica said. “The government has consistently enacted spending bills in past fiscal years that were inconsistent with the budget and outside of the budget process. This budget process must be reformed. PROMESA [the Puerto Rico Oversight, Management and Economic Stability Act] mandates fiscal responsibility, and responsible budgeting means every dollar spent must be accounted for – in government just like in any household or business.”

“For us at the Oversight Board, the approval of the budget is more than just a financial decision; it’s a statement of government priorities and a commitment to invest in the future of the people of Puerto Rico without spending that would tip Puerto Rico back into deficit,” the official added.

The budget includes an additional $432 million in investments in education, including $121 million in commonwealth funding for the University of Puerto Rico (UPR), contingent on UPR establishing and committing to goals and milestones for fostering academic excellence, economic development and financial responsibility. Some 15% of the budget, or $4.9 billion, is for education overall.

The budget also includes an additional $100 million for health and welfare investments, including mental health programs, intellectual disability, and medical residencies. Some 20% of the budget, or $6.6 billion, is for health overall.

The budget further includes $242 million in new infrastructure investments for health centers, road maintenance and ferry operations, and water quality and flood control. An additional $132 million in funding goes to municipalities, including $30 million in funding to municipalities needing more significant financial support. The budget includes an extra $43 million to support the 2024 elections, including for ballot printing, additional staffing, and educational advertising.

Mujica said that if the Legislative Assembly decides to reverse the approval of several measures with fiscal impact that were objected to by the oversight board, then the budget could be included in those that count as a requirement for the fiscal entity created under PROMESA to leave Puerto Rico.

Mujica stated that the measures approved at the close of the ordinary session resulted in the budget being out of balance. Therefore, the board certified his version. PROMESA requires, among other conditions, that there be four consecutive balanced budgets approved by consensus.

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