Island House leaders sue over plebiscite funding

By John McPhaul

Speaker of the House of Representatives Rafael “Tatito” Hernández Montañez, together with Deputy Speaker José “Conny” Varela, announced that on Tuesday they filed a lawsuit against Gov. Pedro Pierluisi Urrutia and the federal Financial Oversight and Management Board in the courtroom of federal Judge Laura Taylor Swain over public funds allocated for a status plebiscite.

“This suit is strictly about fiscal public policy, separation of powers and budget design approach. Before talking about the status issue, the controversy is about how the processes of future and current budget management are governed, and the modifications to it requested by the executive [branch], a matter that the governor is not complying with and on which the [oversight] board is contradicting itself,” Hernández Montañez said. “This is a matter of a game change.”

The speaker of the lower chamber said “the House of Representatives has been consistent in rejecting the authorization of the $1.8 million required to hold this consultation, based on the fact that this claim violates the PROMESA [Puerto Rico Oversight, Management and Economic Stability Act] law, undermines the Constitution of Puerto Rico, compromises the limited state resources to advance the ideological agenda of a single sector of the government and is contrary to the purposes of the Fiscal Plan.”

Regarding the claim, Varela maintained that “our record proves it,” and detailed the following sequence of events:

* On Feb. 1, 2021, the island House of Representatives voted in favor of repealing Laws 165 and 167 of 2020 that authorized the consultation in question.

* On Feb. 8, the oversight board certified that before it was a request from the government of Puerto Rico to reschedule $1.8 million in public funds to pay for the consultation, a request on which the Legislature was never notified.

* On March 5, the legislators sent a communication to the oversight board to oppose the reallocation of those funds for violating PROMESA.

* On March 8, the oversight board accepted the request in a 7-0 vote, for which it determined that the Puerto Rico government did not have the authority to authorize the reallocation of funds without the authorization of the Legislative Assembly.

* The Puerto Rico government objected to the aforementioned determination before the oversight board through the Puerto Rico Fiscal Agency and Financial Advisory Authority (AAFAF by its Spanish initials).

* On March 15, the chairman of the oversight board, David Skeel, sent a communication in which he reaffirmed the refusal of the fiscal entity to authorize the reallocation of the funds and rejected that the board’s determination represented an undue intervention in the free process of self-determination that protects the citizens of Puerto Rico.

* The governor made a new request through AAFAF and in that request was included a draft resolution on behalf of the New Progressive Party, allocating $1.8 million, recognizing the intervention of the Legislative Assembly.

* The oversight board determined in a 4-3 vote that the request be passed and that the Legislative Assembly act. It sent the request to the island House of Representatives.

* On April 7, the members of the Finance Committee of the House of Representatives defeated in a markup session House Joint Resolution 100 to make the reallocation of the funds feasible. Thus the oversight board was notified.

* On April 14, the oversight board reaffirmed that, in accordance with the rejection of the House of Representatives, the budget item could not be used.

* On April 15, the Speaker of the House sent a communication to the island Office of Management and Budget, the Department of the Treasury and AAFAF to certify the source of the funds, the amount reassigned, the expenses incurred and the legal authority used to commit the limited resources of the state, without the intervention of the Legislative Assembly.

* Last Friday, April 16, the government requested an extension that expired Monday at 10 a.m.

“If they allocated the funds so quickly, why did they need an additional two days to disclose where the funds came from?” Hernández Montañez said. “Our claim is that Section 204 (c) of the federal PROMESA law was violated here, an action that directly affects the fiscal plan as it is contrary to its legal purposes.”

“Although the [oversight] board shields itself through the subterfuge that it does not have the authority to intervene in this controversy, its attitude is contradictory, since the entity itself, through the voice of its chairman, rejected that Section 402 of PROMESA was applicable to this situation,” the House speaker said.

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