Fiscal board urges governor not to sign measure to redirect old telecom funds to towns
By THE STAR STAFF
The Financial Oversight and Management Board is urging Gov. Jenniffer González Colón not to sign Senate Joint Resolution (SJR) 202, warning that the measure violates the Puerto Rico Oversight, Management and Economic Stability Act (PROMESA) and established government accounting rules by attempting to reprogram surplus municipal telecommunications license fee balances from prior fiscal years.
In a letter sent electronically on Monday, the oversight board’s executive director, Robert F. Mujica Jr., said SJR 202, approved by the Legislature on Aug. 20 and delivered to La Fortaleza on Sept. 4, seeks to distribute $2.47 million in surplus 2020-2025 Municipal Telecommunications License fee balances held by the Office of Management and Budget (OMB). The bill identifies eight municipalities as having “the most vulnerable populations and the greatest economic need,” and states the funds would support essential services and local operations.
The oversight board countered that the funds cannot legally be used for that purpose. Under Act 81‑2017, telecommunications license fees are appropriated to the OMB to cover its operational expenses. Because government funds operate under modified accrual accounting, Mujica wrote, appropriations expire at the close of the fiscal year and any unspent balances become restricted and unavailable for reprogramming.
“Budgetary appropriations confer spending authority only for the fiscal period for which they are enacted,” the board said.
The board further warned that the measure amounts to an unauthorized reprogramming of prior‑year funds, directly violating PROMESA Section 204(c). Any reprogramming requires oversight board approval, which has not been requested. PROMESA also bars the Legislature from adopting a reprogramming until the board certifies it is consistent with the Fiscal Plan and budget.
“For these reasons, the Bill contravenes established budgetary and modified accrual accounting practices and is inconsistent with PROMESA and the Certified Second Revised 2024 Fiscal Plan,” the letter stated.
The oversight board asked the governor to reject the measure and instead work with lawmakers and the board to identify alternative, fiscally compliant ways to support the municipalities. If the governor signs SJR 202, PROMESA requires her to submit a formal estimate and certification addressing the issues raised. The board also requested written confirmation that the executive branch would not implement the measure unless the board determines it does not violate federal law or the Fiscal Plan.
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