Puerto Rico Gov. Alejandro García-Padilla announced changes to his fiscal team Wednesday that call for shifting Treasury Secretary Melba Acosta to the helm of the Government Development Bank, and naming Juan Zaragoza-Gómez as her successor at the agency. The governor also announced the appointment of Luis Cruz as director of the Office of Management and Budget.
The nomination of Zaragoza-Gómez requires Senate approval, while his recommendation that Acosta assume the presidency of the GDB requires the approval of its Board of Directors. Acosta will continue in her role as the Commonwealth’s Chief Financial Officer, and she will continue to lead the fiscal team and the implementation of the government’s fiscal policy, including its tax reform and revenue efforts, he said.
Zaragoza-Gómez has a B.A. in accounting from the University of Puerto Rico, Río Piedras, where he graduated with the highest academic average in his class, and a master’s in Management from Indiana University.
Since the beginning of this term, he has been advising Acosta on tax matters, especially in the evaluation and development of legislation, among other issues, including the creation of the so-called “Patente Nacional.”
His designation has already received criticism from opposing party members who believe there could be a conflict of interest in his designation, for his close proximity to the Treasury Department in recent months.
Meanwhile, Cruz has a degree in Accounting from the UPR and a MBA from the Inter-American University of Puerto Rico.
In 1994, he established his own firm of certified public accountants and consultants. From 2001 to 2008, he provided consulting services to OMB in the preparation of the Commonwealth’s annual budget, the projections of estimated public expenditures and monitoring of public spending of the General Fund, among other projects.
Additionally, he has collaborated on special projects for the departments of Treasury, Education, Police, Health and Corrections, among others. From January 2013 to August 2014 he was director of the Budget and Finance Committee of the House of Representatives.
García-Padilla said collaboration will continue with outgoing OMB Director Carlos Rivas to achieve fiscal sustainability of Puerto Rico’s public health system.
“For almost two years, my tax team has worked tirelessly to address the fiscal challenges we inherited. We have successfully addressed the General Fund deficit as well as the liquidity and solvency of the GDB and public corporations,” he said during a news conference held at La Fortaleza early in the afternoon.
“We put forth, for the first time in [more than] 20 years, a balanced budget while focusing our resources on health, safety, education and economic development priorities. We cannot deviate from this route. These nominations and appointment will further advance and strengthen Puerto Rico’s fiscal discipline, promote economic growth, and continue to improve the quality of life of our people,” he said.
“Puerto Rico needs to establish an integrated and comprehensive fiscal strategy that addresses the challenges facing the health system for the long term, given the demographic trends and increasing costs of medical services. This requires a strategy that completes and makes viable the finance of the public system in its broadest sense, including the Medical Center Administration Health Insurance (known as ASES in Spanish), the Centers for Diagnosis and Treatment, Management Compensation Automobile Accidents (known as ACAA) and the State Insurance Fund [workers compensation fund],” he added.
Finally, GDB Interim President José Pagán-Beauchamp will serve as advisor to the GDB President. GDB Chairman David Chaffey will remain in his role.