White House provides rationale for fiscal board firings ahead of hearing

From left: Arthur J. González, Andrew G. Biggs and Betty A. Rosa

By THE STAR STAFF

Ahead of today’s hearing, White House Deputy Director of Presidential Personnel Morgan DeWitt sent nearly identical letters to ousted Financial Oversight and Management Board members Arthur J. González, Andrew G. Biggs and Betty A. Rosa, purporting to provide “cause” for their abrupt removals.

The letters were met through a motion with fierce opposition, as plaintiffs argue that the stated reasons do not establish valid cause for removal under the Puerto Rico Oversight, Management and Economic Stability Act (PROMESA).

The letters come weeks after the dismissed fiscal board members sued President Donald Trump arguing that their firings were illegal. A hearing in federal court is slated for today.

The legal team of the ousted members submitted the letters to the court as evidence, pointing out inaccuracies, such as the incorrect suggestion that the oversight board spent $2 billion on its operations. (That amount is what has been spent on professional services.) They also underscored that disagreements regarding costs approved by the Title III court are not valid grounds for presidential removal under the PROMESA framework.

Furthermore, the plaintiffs maintain that the alleged rationale is an insufficient post-hoc justification for the removals, arguing that it amounts to a policy disagreement rather than an actionable offense. They emphasize that the government has previously acknowledged that policy disagreements do not constitute valid cause for removal.

In anticipation of the government’s reliance on the letters during today’s hearing, the plaintiffs said they are prepared to challenge their assertions. They contend that the letters are an attempt to justify unlawful actions and call for the court to disregard them when considering the case for immediate injunctive relief.

In the letter, which was attached as an exhibit to a motion submitted by the plaintiffs on Saturday, DeWitt said the president’s decision to remove six of the oversight board’s members was driven by concerns that the board has made little progress in resolving Puerto Rico’s economic crisis, particularly regarding the Puerto Rico Electric Power Authority (PREPA), which remains in bankruptcy and continues to struggle with reliability issues.

He said the president referred to PREPA’s ongoing challenges as a symbol of the oversight board’s mismanagement and inefficiency. PREPA’s struggle to provide power to Puerto Rico’s citizens was one of the key reasons for the creation of the oversight board through PROMESA in 2016. However, almost a decade later, PREPA has not emerged from bankruptcy, and its performance still lags behind comparable mainland utilities.

A former oversight board member has publicly criticized the board’s failure to resolve PREPA’s bankruptcy over the past decade, describing it as “disgraceful and harmful” and attributing responsibility for impending electricity blackouts to the board. The president emphasized the need for effective leadership and urgent action to address the fiscal crisis and improve essential services for Puerto Rico’s citizens, and insisted that he wants the board members out.