Governor seeks $60 million increase in oil price mitigation contribution

By John McPhaul

jpmcphaul@gmail.com

Gov. Pedro Pierluisi Urrutia proposed on Thursday an amendment to Senate Bill 931 to increase the contribution of the State Insurance Fund Corp. (CFSE by its Spanish initials) from $165 million to $225.5 million to mitigate increases in the rates of LUMA Energy and the Puerto Rico Aqueduct and Sewer Authority (PRASA).

“Senate Bill 931 guarantees that relief immediately,” the governor said at a press conference. “It provides for the State Insurance Fund Corporation to contribute $165 million from its operational surplus to mitigate the impact on electricity due to the purchase of three months of fuel by the Puerto Rico Electric Power Authority (PREPA), and reduce the increase in water [rates] for the rest of the year.

“After conversations with the fiscal agencies … as well as the executive director of the State Insurance Fund Corporation, we have agreed that the Fund can contribute up to $225.5 million to give $205.5 million to the Electric Power Authority and $20 million to the Aqueduct and Sewer Authority and thus totally avoid the cost increase in electricity and reduce the cost of water for the whole year.”

The governor said the Puerto Rico Energy Bureau certified to him that with this monetary allocation no increases in the energy rate would occur for the current quarter.

“This contribution will not affect its operations nor will it have an impact on benefits for its employers and policyholders, nor on the reserve of the Emergency Fund,” he said.

Likewise, Pierluisi called on the Legislature to approve the measure.

“What is needed here is the Legislature so that they vote,” he said. “Whoever is in favor of lowering the cost of electricity and water for our people, vote in favor of the measure. It is as simple as that.”