PREPA Board Appoints New Executive Director

PREPA appointed a new Executive Director, Walter M. Higgins III, who will come out of retirement to lead the utility starting this Sunday. Prior to retiring, Higgins lead the Bermuda energy and gas company.

Higgins’ salary, $450,000, is more than double the $170,000 annual salary earned by interim director Justo González, who has held the post since November. Higgins will move from Nevada to the Island, is 73 years old, and does not speak Spanish. He has a bachelor’s degree in nuclear science from the US Naval Academy. Higgins promised to update the utility’s technology, as well as to institute rigorous employee performance evaluations.

Regarding privatization, the new PREPA Director said that while he is not intimately familiar with the bill introduced in the Legislature, he is open to it and other ideas. The Governor’s bill would privatize power generation, and enter into public-private partnerships for energy distribution and management.

Six Months After Maria, Senior Trump Administration Officials Visit the Island

U.S. Treasury Secretary Steven Mnuchin will visit Puerto Rico this week to talk to Commonwealth officials about the Island’s finances as well as get a better picture of the overall fiscal situation. Mnuchin and Governor Ricardo Rosselló’s administration have been at odds over the Treasury’s unwillingness to disburse the rest of a $4.7 billion Community Disaster Loan (CDL) over discrepancies regarding the conditions set by Treasury. Secretary Mnuchin testified before a Congressional committee recently that the Commonwealth would have to wait until it had $800 million cash on hand before Treasury would release the remaining funds, which are intended to shore up Puerto Rico’s liquidity after the Island suffered massive revenue losses post-Hurricane Maria. Conditions have apparently improved on the collections front, but disputes remain over the actual state of the Island’s finances.

President Trump’s Homeland Security Advisor, Tom Bossert, was also in Puerto Rico this week to survey recovery efforts.

Legislature Approves Controversial Education Reform Bill

Both houses of the Legislative Assembly have passed an education overhaul bill that has been widely criticized by teachers’ unions and was the subject of protests by public school teachers and their allies. The legislation would introduce charter schools in Puerto Rico, and includes provisions for school vouchers. The idea of vouchers had been proposed in the 1990s, during the administration of the Governor’s father, Pedro Rosselló. At the time, the Puerto Rico Supreme Court ruled that the vouchers violated the Commonwealth Constitution, which prohibits public funds from being used for private entities. The legislation caps the amount of public school students eligible for the vouchers to 3% of the student body, and teachers won concessions to protect their salary scales and other benefits. The bill now awaits the Governor’s signature.

Rubio Sends Letter to Governor, FOB Meeting set for March 26

Florida Republican Senator Marco Rubio sent a letter to Governor Ricardo Rosselló requesting information on the current state of the Commonwealth’s financial situation. The letter is in response to demands by the governor that the Treasury Department release the remainder of the CDL loan to the Island. Rubio said that Congress will exercise its oversight role if, in fact, Treasury is stonewalling the payment and thus threatening the delivery of essential services on the Island, as suggested by the Governor. Rubio stressed in his letter that the Government of Puerto Rico needs to provide the most up to date and accurate picture possible of the fiscal situation facing the central government and its instrumentalities.

In other news, the Fiscal Oversight Board (FOB) will hold its 12th public meeting on March 26 at 8:30am in the Puerto Rico Convention Center in San Juan. The meeting will be held ahead of the FOB’s March 30th deadline to approve the revised fiscal plan presented by the Governor, as well as the fiscal plans for PREPA and the University of Puerto Rico (UPR). The UPR approved their proposed fiscal plan earlier this week, which includes the FOB’s request for a tuition increase. To watch a livestream of the meeting, please click HERE.

Puerto Rico at a Glance: Half a Year Later

Six months after Maria, more than 103,400 PREPA customers (meaning households, businesses, etc.) are still without power.  Many have  been without power and water  since Hurricane Irma, which hit before Maria, on September 6, 2017. Though most of the water services have returned, the government continues to advise residents to boil water before drinking it. Over half of the traffic lights on the Island remain  non-operational, and less than one percent of FEMA claims have been funded at maximum levels.