Puerto Rico Gov. Ricardo Rosselló confirmed that the federal government, through the Federal Emergency Management Agency (FEMA), signed the agreement to have access to Community Disaster Loans.
The agreement provides a commitment by the federal government to extend a credit line to the government of Puerto Rico to provide loans to the central government up to a maximum amount of $2.2 billion.
This amount is equivalent to the local government’s estimated revenue losses during the 365 days following the onslaught of Hurricane María.
The use of these funds would be destined to deal with any future liquidity emergency. This commitment will be valid until March 31, 2020, said Rosselló after a meeting at La Fortaleza with U.S. Treasury Secretary, Steven Mnuchin.
“Thanks to Secretary Mnuchin for working hand in hand with his team and our administration to facilitate that Puerto Rico has access to these loans if necessary after the fiscal and social impact caused by Hurricane María to our Island,” Rosselló said.
“Our thanks to the Department of the Treasury of the United States for trusting Puerto Rico and supporting us in this recovery process,” he added.
To have access to this type of loans it is necessary that the funds deposited in a Treasury Single Account, or TSA, at the Puerto Rico Treasury Department decrease to less than $1.1 billion.
The loan agreement is subject to approval by the Legislative Assembly, the Financial Oversight and Management Board (FOMB), and the Title III Court once it becomes necessary to access the funds.
The document was signed on July 11, 2018 and delivered to the governor by U.S. Department of Treasury officials.