Puerto Rico to distribute $750 million for permanent recovery projects

By The Star Staff

Island government officials announced on Wednesday a program under which cash advances from the Reconstruction Work Fund (RWF) will be granted for permanent projects under a pair of Federal Emergency Management Agency (FEMA) programs.

Puerto Rico has experienced historical and unprecedented disasters since 2017. The impacts of hurricanes Irma and Maria, as well as earthquakes have caused damage to the infrastructure, economy and communities of the island. To assist municipalities in their reconstruction, $750 million has been allocated to help start FEMA-mandated reconstruction projects, announced Puerto Rico Fiscal Agency and Financial Advisory Authority (AAFAF) Executive Director Omar J. Marrero and Manuel Laboy Rivera, executive director of the Central Office for Recovery, Reconstruction and Resilience (COR3).

AAFAF, in coordination with COR3 and the island Treasury Department, developed the RWF guidelines, which were approved by the federal Financial Oversight and Management Board, and established the eligibility criteria. Under the eligibility criteria, advances may be requested for permanent category projects under FEMA’s Public Assistance and Hazard Mitigation Grant programs.

The orientation that will be provided to eligible applicants will focus on providing information on the different stages of the application process under the RWF guidelines. The applicant will begin the advance request process through the COR3 Disaster Recovery System (DRS) platform. The use of the DRS platform will simplify the application process as it is the same one used by applicants under the various assistance programs under FEMA and will serve as a centralized repository of information, Marrero said.

“The reconstruction and recovery of the island is a priority for our governor, the AAFAF and Puerto Rico,” he said. “The flow of federal funds is fundamental in the macroeconomic impact of Puerto Rico and in the fulfillment of the Fiscal Plan. With this orientation campaign we make sure to start providing the tools and information necessary for faithful compliance with the RWF requirements on the part of eligible applicants. The establishment of guidelines for the use of this RWF will allow both municipalities and government agencies to obtain capital to create resilient and beneficial work for all residents of Puerto Rico.”

Laboy Rivera noted that “the lack of capital is one of the main causes of the delay in the development of recovery projects mandated by FEMA under the Public Assistance Program.”

To ensure proper use of the funds, guidelines were established that include risk mitigation controls and processes to maximize the use of the funds.

“At COR3 we will play an active role in monitoring progress and we have assigned personnel for these purposes,” Laboy Rivera said. “As part of the process, the municipalities or state entities that benefit from the RWF must provide monthly reports on its use.”

Municipalities will be given priority in accessing the funds but central government agencies and public corporations will be able to apply.

The advanced cash payments will be repaid to RWF with reimbursements received from FEMA, insurance proceeds, or any other funds from the applicant. The RWF expires on June 30, 2025.

Central government entities, whose funds are administered by the Treasury Department, have the alternative of repaying cash advances through the Federal Cost Share approved by the commonwealth Office of Management and Budget, in coordination with COR3 and whose purpose is to provide, as loans, the necessary funds to cover the Non-Federal Cost Share, in order to begin to carry out the reconstruction work.

The applications will be available in May through the Puerto Rico Disaster Recovery Solution.

Laboy Rivera added that “we will soon announce the opening date to receive applications through the DRS.”

“The request must include information on the applicant, the project in question, and an estimated date by which the subrecipient will be submitting Requests for Refund (RFR) to COR3, among other information,” he said.

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