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Comptroller’s Office: Roosevelt Roads redevelopment lagging

The Puerto Rico Comptroller’s Office issued a qualified opinion on the fiscal operations of the Roosevelt Roads Naval Station Redevelopment Authority confirming the lag plaguing the revitalization of the former Navy base in Ceiba in different aspects.

The naval air station — which among other things included Puerto Rico’s longest air strip at 11,000 feet — closed in 2004, and in May 2013, 3,400 acres of it were transferred to the Redevelopment Authority, upon completing the Economic Development Conveyance (EDC) Agreement with the U.S. Navy.

That year, the local government agency unveiled a reorganized the Master Plan in nine development zones under the 2014 Master Plan Development Zones.

The Report of the audit that covers the period from July 1, 2016, to Sept. 15, 2021, reveals that the Authority did not require timely work itineraries and progress reports on lease contracts formalized from 2015 to 2018 for the operation of the shipyard and a dry dock, for the manufacture of metal and plastic parts, and for the development of a residential rental resort community.

Compliance with these contractual requirements occurred, up to four years later with schedules and up to two years later with progress reports. These situations do not make it possible to control the status of the work or supervise compliance with the contracts, the Comptroller’s Report stated.

“In addition, the Authority does not maintain a technical file per project and the Board did not provide for examination evidence that the executive director has presented three of the five work plans, nor six budgets,” the report stated.

“So, the Authority was unable to exercise adequate control of the file, and furthermore, the inspection work of the auditors of the Comptroller’s Office is made difficult,” it stated, recommending that the governor and the Legislative Assembly “take the appropriate measures with respect to the delay in the redevelopment of the land and facilities of the Naval Station.”

The Comptroller’s Office’s audit of two findings indicates that the Redevelopment Authority has not appointed a records administrator, has not complied with preparing an inventory of inactive records, nor does it have an updated record retention plan.

The report also confirmed that the Naval Station’s facilities “are deteriorated and are not being used.”

“After nine years since the transfer of three parcels to the Authority and making investments of $30.8 million and accruing a debt of $24.5 million, it only had 14 projects with 17 tenants occupying a third of the acres of the Authority’s land,” the Comptroller’s Office report revealed.

Meanwhile, the report states that the Authority had not hired a master developer, after an evaluation of eight proponents in 2014, and incurring expenses in this regard for $459,455.

In addition, after formalizing a contract with the U.S. Department of Agriculture, to receive a loan for $4.9 million and receive a grant of $666,200 to carry out improvements to the drinking water system, it is still in the phase of beginning the bid process.

As of June 2021, only 392 jobs had been created, the audit stated, citing reports from the Department of Economic Development and Commerce (DDEC, in Spanish).

Authority’s timeline during audit
Over the stretch of time covered in the Comptroller’s Office audit, the Redevelopment Authority opened calls for several projects, including six announced in 2018 that would generate 750 jobs, as News is my Business reported.

The government also unveiled a proposal to develop a renewable energy micro grid for power generation and distribution. In April 2020, the U.S. Department of Commerce’s Economic Development Administration announced that it would award $4.5 million grant to the Redevelopment Authority to rehabilitate a building and make other infrastructure improvements on former Naval Station.

That grant aimed to support early-stage businesses focused on the visitor economy and was expected to create 134 jobs, and spur $1.5 million in private investment. 

In May 2021, the Redevelopment Authority confirmed plans to oversee $50 million in infrastructure upgrades to the former Naval Base in stages that would take place prior to seeking a master developer.

Author Details
Author Details
Business reporter with 30 years of experience writing for weekly and daily newspapers, as well as trade publications in Puerto Rico. My list of former employers includes Caribbean Business, The San Juan Star, and the Puerto Rico Daily Sun, among others. My areas of expertise include telecommunications, technology, retail, agriculture, tourism, banking and most other segments of Puerto Rico’s economy.

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