NAP Funding Extension Likely to be Resolved After Congressional Recess

Puerto Rico’s funding shortfall for the Nutritional Assistance Program (NAP, Puerto Rico’s equivalent of SNAP) has already reduced benefits for more than 1 million beneficiaries. Advocates were hopeful that the issue would be resolved this week, but Senate Appropriators are still negotiating the final details of a supplemental disaster appropriations bill that would include $600 million for NAP. Beneficiaries have already seen reductions of as much as $200 a month. NAP is a critical source of food support for 46% of Puerto Ricans.

Negotiations are focused on reconciling a $16 billion bill approved in the House that would provide emergency relief to several jurisdictions that have faced recent natural disasters. The House bill includes the $600 million for NAP, $25 million for the Martín Peña Canal dredging project, and an extension of the federal cost-share waiver for FEMA projects in the Commonwealth. There was hope that a final bill could come to a vote this week, but our sources indicate that negotiations are ongoing and are unlikely to be resolved before next week’s Congressional recess.

Federal Tourism Incentive Part of New Push in D.C.

The Government of Puerto Rico is pushing for Congress to provide a federal tax incentive for the Island’s tourism industry. According to El Nuevo Día newspaper, Treasury Secretary Raúl Maldonado believes there is interest in Congress for Governor Ricardo Rosselló’s proposal seeking federal tax credits for entities that invest in tourism related projects on the Island. The proposal—which first began circulating last October, as part of Governor Rosselló’s requests related to the Island’s recovery after Hurricane Maria—would allow investors a 25% tax credit on qualified investments, as well as payroll tax credits.

Maldonado also stated that he’s been lobbying for the proposal on Capitol Hill.

Puerto Rico is also pushing for a lower tax rate for Controlled Foreign Corporations (CFC) doing business on the Island. These are U.S.-based companies, mostly manufacturing, that do business on the Island and were hit with tax hikes by the 2017 federal tax reform overhaul.

New Political Party Seeks to Upend Puerto Rican Elections

The new “Movimiento Victoria Ciudadana” (MVC, or Citizens Victory Movement in English) filed paperwork before the Puerto Rico State Elections Commission (CEE) to register as a new political party. The organization must now gather 45,000 signatures and become certified by the CEE in order to become an official political party. In a meeting at San Juan’s historic Teatro Tapia Theater, party founders stressed that a national assembly would choose candidates for the 2020 general elections. One of the most prominent of the founders of the new group is former independent gubernatorial candidate Alexandra Lúgaro, who received a historic 11% of the votes in the 2016 elections.

The MVC rejects the Fiscal Oversight and Management Board (FOMB) and proposes a halt to public funding for the Board. MVC also proposes a Constitutional Assembly on Status to choose between independence, statehood and free association. Commonwealth is not among the proposed options. This is an important distinction, since the MVC proponents are trying to create a coalition of pro-Commonwealth Popular Democratic Party (PDP), independence supporters and others, although Lúgaro said statehooders were welcome too.