Fiscal board flags flaws in Housing Dept. contract for solar & water systems

Puerto Rico Housing Secretary Luis A. Martínez Román

By THE STAR STAFF

The Financial Oversight and Management Board has approved -- with pointed concerns -- a $7.2 million contract between the Puerto Rico Department of Housing (PRDOH) and Green Energy & Fuels Inc. for the design and installation of photovoltaic and water storage systems under the Community Energy and Water Resilience Installation Program.

But the approval comes with serious observations related to sloppy work and installation. The oversight board highlighted serious deficiencies identified by the U.S. Department of Housing and Urban Development’s Office of Inspector General (OIG) in an April 14 report, which found that previously installed solar and water systems funded via the Community Development Block Grant Disaster Recovery (CDBG‑DR) program suffered from exposure‑related damage and inadequate oversight.

“PV Systems and water tanks that have been installed in participants’ homes have deficiencies stemming from exposure to the elements and direct sunlight,” the board noted, citing the OIG’s conclusion that PRDOH “did not provide adequate support to justify its contract amendments with installers.”

According to a June 22 letter to Housing Secretary Luis A. Martínez Román, the contract, procured through competitive process CDBG‑DR‑IFB‑2025‑01, carries a maximum value of $7.2 million and a 36‑month term, with an optional two‑year extension. Any extension, the board warned, must be resubmitted for review.

HUD’s Inspector General recommended that PRDOH either remediate all outdoor installations exposed to sunlight or repay more than $19 million in federal funds, submit documentation supporting over $31 million in contract amendments, strengthen future contract scopes, and re-evaluate income‑eligibility methodologies.

In its letter, the oversight board directed PRDOH to implement those corrective measures and provide quarterly updates on its progress.

The agency certified that the new contract will be funded entirely with federal CDBG‑DR allocations from accounts 6090‑06‑000 and 4190‑13‑000. The board confirmed that sufficient funds are budgeted for fiscal year 2026 but cautioned that any future shortfall would require PRDOH to identify savings and submit a budget reprogramming request.

The oversight board emphasized that its review is limited to compliance with the Puerto Rico Oversight, Management and Economic Stability Act and did not do due diligence.