FOMB Sets Deadlines for Government; House Chairman to Visit Puerto Rico

The PROMESA Financial Oversight and Management Board (FOMB) late yesterday released a letter dated Monday asking the Puerto Fiscal Agency and Financial Advisory Authority for a timetable for past-due audited financial statements for the territorial government by next Monday.

The statements would cover the fiscal years ending June 30, 2015, ‘16, and ’17.

In another Monday letter released late yesterday, the Board also set a new deadline of next Monday for University of Puerto Rico President Daniel Hillman to provide a timetable for weekly reporting of UPR’s financial liquidity and an explanation of any barriers to reporting.

On March 8th, the Board requested the information by March 30th.

In Monday’s letter, the Board threatened to formally order production of the data and ask the territory’s governor to discipline Hillman if he continues to fail to comply.

The letters were released on the eve of a visit to the islands by the chairman of the U.S. House of Representatives committee responsible for territory matters, including PROMESA. Natural Resources Committee Chairman Rob Bishop (R-UT) has criticized the PROMESA Board for not being aggressive enough with territorial officials and not working more closely with bond creditors.

Governor Ricardo Rossello Nevares (New Progressive Party/PNP) responded to a Bishop letter to the Board with a letter to the committee chairman harshly criticizing him.

Bishop is scheduled to meet with Board Chairman Jose Carrion and Resident Commissioner in the House Jenniffer Gonzalez Colon (R/PNP).

The Governor yesterday said that he was unaware of the visit.

Monday’s letters were sent after the Board sent letters late Friday that set deadlines for budgets for the Electric Power Authority and the Aqueduct and Sewer Authority for fiscal year beginning July 1st adjusted to the Board’s fiscal adjustment plans for the agencies.

PRASA was given a deadline of Monday and PREPA May 30th.

Both agencies were also asked for comparisons to past spending, capital improvement plans, and reporting templates.

The Board identified a variance between the $970 million revenue projections for PRASA in the fiscal plan and a PRASA budget. Instead of the PRASA’s $943 million in operating revenue and $27 million in miscellaneous revenue, the plan anticipates $890 million in operating revenue, $27 million in miscellaneous revenue, $23 million from a rate increase, and $29 million from increased collections.

The letter stated the Board would act on the budgets by June 8th. The agencies would have until June 18th if revisions are required, with final budgets adopted by the Board June 29th.

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