Op-Ed: Puerto Rico State Housing Plan a disappointment

Written by  //  September 25, 2012  //  Biz Views  //  No comments

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Author Vicente Feliciano is president of Advantage Business Consulting (Credit: © Mauricio Pascual)

Some people in Puerto Rico think that there are too many studies and too little action. The real problem is that there are too few good studies and too much action based on faulty information. Some examples are the oversized facilities of the urban train, the Terminal A that was closed for years at the Luis Muñoz Marín Airport, and the Bio-Molecular Building near the Río Piedras Medical Center, which is still empty.

The Puerto Rico State Housing Plan 2011–2015 has just been released to the public by the Housing Department. It is so full of mathematical mistakes, inconsistencies, and unexplained figures that it is dangerous if used as a source for decision making.

Let’s look at some examples.

Executive Summary, pg. iv

The report states: “For the five year period the estimated number of units required is 34,693, of which some 10,919 are new rental units for the elderly and 3,646 are for homeless and the rest, some 24,208, for low, very low and moderate income households.”

The figures do not add up!  And this is the Executive Summary, which is expected to have been thoroughly reviewed.

Graph on pg. 7

Graph pg. 7
The projection of population by age group shows an increase of 128,000 for the 2010-2020 period. In light of the decline in population of 82,000 for the 2000 to 2010 period, the projection used seems to have been prepared before the Census 2010 data was available.

However, when the Puerto Rico State Plan was prepared, the Census 2010 was available. In fact, data from the Census 2010 is used on pg. 9 of the Plan. Instead of adjusting the projections in page 7, the Plan uses dated information without any modification. To the extent that the PR State Plan relies on unadjusted pre-Census 2010 information, it is not a useful document.

Table on pg. 47
The table on pg. 47 shows resources for 2011 and for a five-year total. There is reason to think that there are some issues with the figures.

Table on pg. 47

For example, Law 73 funding was $5 million for 2011 and $5 million for the projected five year total for an average of $1 million per year or an 80% decline. Is the PuertoRico State Plan an 80 percent decline in Law 73 funding?

On the other hand, CDBG funding is $26.6 million for 2011 and five times this amount ($106.4 million) over five years. However, CDBG funding is apportioned on the basis of Census data. The Puerto Rico decline in population, known at the time of the report, means a lower CDBG assignment. Similar questions can be raised for many of the other line items in the table.

The Puerto Rico housing industry is still in crisis partly as a result of flawed analysis.

Instead of raising the bar, the Housing Department has a relapse with the State Housing Plan.

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