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  • Writer's pictureThe San Juan Daily Star

Fiscal board rejects $562 million federal funds transfer to towns

Sen. Juan Zaragoza Gómez

Also seeks information on proposal for Vieques-Culebra economic zone

By The Star Staff

The Financial Oversight and Management Board said a bill that would allocate $562 million in federal funds to a municipal emergency assistance fund is inconsistent with the Puerto Rico Highways and Transportation Authority’s (HTA) 2022 fiscal plan.

However, the oversight board requested more information on a bill to create the Vieques-Culebra special economic development zone.

The information is contained in letters sent by the oversight board’s general counsel, Jaime A. El Koury, to Popular Democratic Party Sen. Juan Zaragoza Gómez this week. Senate Joint Resolution 391 seeks to assign $562 million in federal funds from the Infrastructure Investment and Jobs Act (IIJA) to the Municipal Emergency Assistance Fund to improve municipal and state highways, roads and bridges.The bill is inconsistent with the 2022 certified fiscal plan for the HTA and with the law establishing the use of the funds, the board said.

“Further, the funds provided under IIJA are required to be administered by HTA as the sole FHWA grantee in Puerto Rico. The Bill, however, purports to allocate these funds directly to municipalities for uses other than those contemplated by IIJA and the 2022 HTA Fiscal Plan,” the letter notes. “The Bill, therefore, seeks to use federal dollars in a manner neither approved by federal statute nor the 2022 HTA Fiscal Plan and is, therefore, inconsistent with the 2022 HTA Fiscal Plan.”

Based on the above, the oversight board recommended that the commonwealth identify other federal grant opportunities made available through the IIJA for the purposes intended by the legislation and coordinate with the HTA on its efforts to apply for competitive grants provided by the IIJA.

Meanwhile, a second letter to Zaragoza Gómez asked the Senate for more information so the oversight board could begin evaluating a bill to create the Vieques-Culebra special economic development zone. Senate Bill 1201 seeks to amend Articles 3 and 4 of Act 153-2002, known as the Act to Create the Vieques-Culebra Special Economic Development Zone, to extend the scope of special incentive programs and stimulate economic activity in Vieques and Culebra and to incorporate new benefits that promote commercial activity in the offshore island municipalities.

“The Bill, as currently drafted, has aspects that appear to impact various sectors of the Puerto Rico economy and government,” the letter notes. “Therefore, the oversight board urges the legislature to analyze thoroughly the Bill’s impact on the corresponding certified fiscal plan. If you have undertaken any analysis regarding the Bill, we request you share such information with us as soon as possible.”

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