Fiscal board flags executive orders involving Emergency Reserve Funds

Financial Oversight and Management Board Executive Director Robert F. Mujica Jr.

By THE STAR STAFF

The Financial Oversight and Management Board has informed Gov. Jenniffer González Colón that it has concerns with three executive orders issued recently because of the intended use of Emergency Reserve Funds.

In a letter sent Monday, the oversight board confirmed it had reviewed Executive Orders 2026‑027, 2026‑032 and 2026‑033, which declare separate states of emergency related to coastal erosion, water service interruptions, and forest fires across multiple municipalities. While the board did not block the measures, it warned that the government must adhere strictly to the rules governing emergency funding.

Executive Order 2026‑027 declares an emergency due to severe coastal erosion in Parcelas Suárez in Loíza and elsewhere along Puerto Rico’s northern coast. The oversight board cautioned that Emergency Reserve Funds should be used only for post‑disaster response -- such as shoreline stabilization or debris removal -- and only when a disaster has been declared and federal funds are unavailable.

Preventive or recurring erosion management, the board emphasized, must be financed through recurring or specially designated sources. It urged island agencies, including the Department of Natural and Environmental Resources and the Office of Management and Budget, to incorporate long‑term erosion mitigation into the government’s Capital Plan and multi‑year financial planning.

Executive Order 2026‑032 declares an emergency in Río Grande and Canóvanas due to programmed interruptions in drinking water service and authorizes activation of the Puerto Rico National Guard to support the Puerto Rico Aqueduct and Sewer Authority (PRASA).

The oversight board noted that the Emergency Reserve is intended for extraordinary events -- natural disasters or other uncontrollable situations -- not operational issues. While drought‑related shortages may qualify, interruptions caused by PRASA’s repair work do not meet the criteria. PRASA, the board said, must identify recurring or designated funding sources instead of relying on emergency reserves.

Executive Order 2026‑033 declares an emergency in Carolina, Río Grande, Loíza and Canóvanas due to forest fires and authorizes National Guard support for the Firefighters Bureau. The board indicated that if the fires constitute a certified emergency beyond the government’s budget capacity, the use of Emergency Reserve Funds may be permissible.

The oversight board reiterated that the government must request authorization before using Emergency Reserve Funds, as required by the Certified Second Revised 2024 Fiscal Plan. Any funds disbursed must be replenished no later than the following fiscal year.

It also reminded the governor that all executive orders must be submitted for review prior to issuance, as mandated by the Puerto Oversight, Management and Economic Stability Act, commonly known as PROMESA. Any material changes to the orders must be resubmitted for approval.

The letter, signed by Executive Director Robert F. Mujica Jr., notes that the oversight board may provide additional observations as new information becomes available and may refer matters to relevant authorities if warranted.