Task Force to help Puerto Rico ‘maximize federal funds’
A team of federal officials representing several agencies will come to Puerto Rico next month to help the local government navigate through the economic crisis, prompting more rumblings of the possibility of a receivership for the island.
According to the Associated Press, the team will include representatives from the U.S. departments of Education, Health and Human Services, and Housing and Urban Development, as well as the Environmental Protection Agency. Citing an unidentified source, the AP said the group would work with the Puerto Rican government to “best maximize federal funds in those areas to help boost its economy.”
“The officials will work in an advisory capacity and no additional federal funds are planned beyond current allocations,” the AP reporter Danica Coto said in her story.
As soon as word broke, the García-Padilla administration acknowledged that the fiscal and economic development team met Wednesday morning with members of the President’s Task Force on Puerto Rico, which has established a team to work with the island’s problems.
However, in a release, the administration rejected that the U.S. government is looking to take control of Puerto Rico’s fiscal situation. The island is about $70 billion in debt, with no possibility of filing for bankruptcy, like the city of Detroit opted to do to wipe its slate clean.
In October 2009, Obama signed an executive order that instructed the Task Force on Puerto Rico to expand the responsibilities of the group that addresses issues related to job creation, education, health, renewable energy and economic development.
“Our administration maintains a close working relationship with the government of President Barack Obama. As part of the collaborative efforts, the White House interagency group provides strategic advice to the government of Puerto Rico, in the same way that it provides it to other governments,” Chief of Staff Ingrid Vila-Biaggi said.
“The group advises us on how to most effectively use federal funds to improve the economy and quality of life of Puerto Rican families. This in no way means federal control over the island’s economy,” she said.
“We continue implementing our economic development plan focused on the task of creating new jobs, tackle the crime rate and strengthen our educational and health systems,” she added.
Vila-Biaggi headed Wednesday’s meeting with stateside officials, which also included Treasury Secretary Melba Acosta, Office of Management and Budget Executive Director Carlos Rivas, Government Development Bank Interim President José Pagán and Puerto Rico Industrial Development Company Executive Director Antonio Medina.
Pierluisi expresses support
Resident Commissioner Pedro Pierluisi said he had previous knowledge about the inter-agency team and had expressed his support of the decision.
“In meetings and other communications, I have been urging the administration to move beyond monitoring the situation in Puerto Rico, asking them to take specific and concrete steps to help the governor and his economic advisors formulate sound fiscal policies that will spur economic growth and enable the territory to maintain access to capital markets,” Pierluisi said. “For the sake of the people of Puerto Rico, I hope the governor and his economic team will listen carefully to the counsel that is provided.”
“I am encouraged that the inter-agency team will help identify instances where the Puerto Rico government is not taking full advantage of current federal funding opportunities, but I would urge the administration to go further,” he said.
Because it is a territory, Puerto Rico is excluded from key programs, like Supplemental Security Income and the Earned Income Tax Credit, and treated unequally under numerous other programs, like Medicaid, Medicare, the Child Tax Credit, and Temporary Assistance for Needy Families.
“Just last week, as a result of efforts I undertook over the course of two years, the U.S. Department of Health and Human Services increased funding for Puerto Rico under a program — LIHEAP —that helps low-income families pay their electricity bills, from under $4 million a year to nearly $15 million a year,” he said.
Another stateside agency keeping its eye on Puerto Rico is the Federal Reserve Bank of New York, which includes the island’s economic performance in its regular assessments.
On Wednesday, agency President William Dudley participated in an event in New York City to discuss conditions in the national economy and conditions the our region, during which he threw his two cents into the discussion.
“More troubling, however, is that Puerto Rico’s economy remains exceptionally weak; activity and employment on the island continue to decline,” he said.