By The Star Staff
Gov. Pedro Pierluisi Urrutia said Tuesday that he is inclined to sign the tax bill that the Financial Oversight and Management Board rejected on the basis that it does not comply with the commonwealth fiscal plan.
“I am inclined to sign it, yes, but it is important that we give all the relevant information to the [oversight] board and that the board, instead of litigating this matter, which would be unfortunate, [and] would entail an expense that would not be what we want to be incurring,” the governor said in response to questions from the press. “Because what I hope … our goal is for the board to allow me to sign it and for it to be implemented subject to some agreements.”
“I see myself inclined to sign it,” he added. “What happens is that I don’t want to have a clash with the board and, to make matters worse, then, well, the court invalidates the law. That is what we want to avoid at all costs.”
Treasury Secretary Francisco Parés Alicea said earlier on Tuesday that he would recommend to the governor that he sign the tax amendment bill approved by the Legislative Assembly, despite the oversight board’s objection.
“My recommendation is that he sign it,” Parés Alicea said at a press conference. “When you see numbers of this magnitude, I do not see inconsistency with the fiscal plan. I don’t see it.”
The Treasury secretary reiterated that the government has the financial capacity to grant the relief contained in the bill “without preventing us from complying with the state’s obligations, including those contracted in the debt adjustment plan confirmed by the federal court.”
“If we can get the [oversight] board to understand the importance of this issue for the people, I am sure that they will finally support the approved bill, whose fiscal impact would be about $550.2 million annually,” Parés Alicea said. “It would be unfair on my part not to recommend that the governor sign the measure.”
The governor pointed out that he has 30 days “to sign or veto the measure.”
“I want those 30 days to be taken advantage of; for example, to update and reach joint agreements to update the fiscal plan,” Pierluisi said. “For example, the collections that this plan establishes are significantly less than what we have already achieved. And in the expense area. In other words, I think we have to do this process of updating or reviewing the fiscal plan now. Because when the board wrote [their objection], one of the things they pointed out is that the measure is inconsistent with the fiscal plan. Well, it is inconsistent with the current fiscal plan, which must be reviewed.”
“Aside from that, to the extent, and the board apparently didn’t have that in its sights, there are provisions that allow the government to adjust spending,” the governor added. “Yes, if by some chance, the collections are not enough to cover all the budgeted expenses. In other words, the measure even distinguishes a mechanism to adjust spending. The PROMESA Law [Puerto Rico Oversight, Management and Economic Stability Act] also gives the board the power to adjust expenses quarterly to the extent that collections do not cover expenses. In other words, I want all of this to be discussed within this period of time, to prevent the board from challenging the measure, to prevent the board from going to court to have the measure revoked.”