PRITA insists free-ride initiative has no negative fiscal impact

Puerto Rico Integrated Transportation Authority Executive Director Josué Menéndez Agosto, at center

By The Star Staff

Puerto Rico Integrated Transit Authority (PRITA) Executive Director Josué Menéndez Agosto said Monday that the free-fare initiative at the Urban Train has not had a negative fiscal impact and that PRITA delivered information on the matter to the Financial Oversight and Management Board.

The oversight board gave the government until May 28 to provide information about the PRITA free-fare initiative because an economic analysis was not discussed nor approved by the entity.

Menéndez Agosto said on a radio program that officials decided to launch the free-fare initiative to improve the transportation system between March and August after a contract was signed in 2021 for such purposes, which would allow the granting of federal aid to cover the loss of income.

He said the oversight board is “pointing out that there is a loss, and that is why the fiscal plan is affected.”

“The fiscal plan is not affected because we have a federal subsidy,” Menéndez Agosto said. “Not only that, but since March 7, we have been in communication. We gave [the board] everything that they are asking us for in the letter and we gave it to them,” he said, appearing surprised.

Oversight board spokeswoman Sylvette Santiago said that when a fiscal plan is impacted, by whatever decisions there may be, the board must be notified.

“The board is not saying, don’t implement it. What the board is saying is ‘I need you to tell me, under section 104 of PROMESA [the Puerto Rico Oversight, Management and Economic Stability Act], how you implemented it, how you reached this decision,’” she said. “Give me evidence of how you decided that you have all the resources to implement it and then tell me what measures or plan you will use to reinstate the rates when this six-month period ends.”

When asked why the oversight board waited until May 10 to send the letter to PRITA, Santiago stressed that it is just a way to request what they are looking for. She disputed Menéndez Agosto’s remarks to the effect that PRITA has provided the information the board requested.

There would be no problems if the fiscal plan is not affected by the arrival of specific federal aid to address the loss of income with the free rate.

“I am going to answer the letter because I disagree with it,” Menéndez Agosto stated, adding that on Wednesday he will formally respond to the entity.

PRITA expects up to a million passengers by the end of May.

“We have been surprised by this communication for several reasons, first, because Section 204D of the PROMESA law clearly establishes that this federal statute does not apply to mass transportation, which gives us the power to make these types of decisions without the need to consult with the Fiscal Oversight Board [sic],” he said. “It should be noted that the FTA [Federal Transit Administration], specifically, has a provision in its regulations that allows this type of measure [free rate] in all states and territories of the United States.”

The free-ride initiative will give citizens the time necessary to learn about and test the system of ticket offices and automated access doors while the installation is completed at each of the stations, PRITA said. The new system is intended to provide stability to a system that is made up of both trains and buses, and having multiple fares or access and payment systems would have been disastrous for its patronage, the authority said. More importantly, it noted, the initiative will allow more people to see the benefits of using the collective transportation system.

At the end of April, PRITA said its ridership had exceeded 709,000 passengers, “and everything indicates that it will exceed one million at the end of May,” the entity said.