La Fortaleza economic team reps can’t name repayment source for SIF in fuel cost offset bill
By The Star Staff
Gov. Pedro Pierluisi Urrutia’s economic team, comprising the Treasury Department, Office of Management and Budget (OMB) and Puerto Rico Fiscal Agency and Financial Advisory Authority (AAFAF by its Spanish initials), was unable to say through representatives of each of the agencies on Monday how it would repay the State Insurance Fund Corp. (SIF) the $165 million that is slated to be transferred to the Puerto Rico Electric Power Authority (PREPA) and to the Puerto Rico Aqueduct and Sewer Authority (PRASA) to offset high fuel costs.
The team’s remarks were made at a hearing to evaluate Senate Bill 931, which seeks to create the “Law to Mitigate the Increase in the Price of Energy in Puerto Rico.” The joint hearing was conducted by the Senate Committee on Strategic Projects and Energy, chaired by Sen. Javier Aponte Dalmau, and by the Government Committee, which is chaired by Sen. Ramón Ruiz Nieves.
The bill gives the government 24 months to repay the $165 million.
Aponte Dalmau noted that his committee gave the government a week to identify a source of repayment. The government is proposing to increase the amount of the transfer to $225 million.
“So, we are going to withdraw funds from the Corporation [SIF], we are going to do the same thing again in a bankruptcy process and we are evaluating something that the Financial Oversight and Management Board has not yet said whether it supports or not,” Aponte Dalmau said. “This Legislature is not going to give that money to the governor. Here there is no evidence of where the source of repayment is going to come from.”
Aponte Dalmau added that despite the fact that such an important issue for the island was being discussed, none of the Cabinet members showed up in person to the hearing.
Jean Peña Payano was the AAFAF representative and Roberto Rivera appeared on behalf of the OMB.
“The SIF has stable income and solid reserves that exceed the amounts necessary to meet its current obligations,” the economic team’s joint presentation says. “Therefore, and given the circumstances we are facing, it is prudent to transfer the surpluses from the SIF to PREPA and PRASA to counteract the effect of the increase in the price of fuel on the essential services they provide.”
Peña added that the measure would not affect the services of the SIF.
Ruíz Nieves questioned where the change in the amendment to the measure from $165 million to $225 million came from. Rivera from the OMB responded that “for the purposes of the change, it is so that the power rate is lowered to zero and not by half.”
Meanwhile, the SIF has a debt amounting to $1.4 billion, according to the SIF Association and Federation of Managerial Employees.