The Financial Oversight and Management Board for Puerto Rico, created under the Puerto Rico Oversight, Management and Economic Stability Act of 2016 (PROMESA), met for the first time in Puerto Rico on November 18, after two meetings in New York City.
At the November 18 meeting, the board committed to finalizing a Fiscal and Economic Growth Plan (FEGP) by January 31st. Calling this “an ambitious agenda,” Chairman José Carrión nonetheless said that it is also a realistic goal, assuming that all the stakeholders cooperate.
“Puerto Rico faces a massive budget and cash cliff and significant reforms are needed even without bond payments. There are no quick fixes or near term promises of substantial, additional federal help. The consensus among stakeholders is consistent with the Board’s assessment: more needs to be done to restore growth and opportunity. The Board is committed to work with the Government of Puerto Rico to restore opportunity for its people. Tough choices and hard work ahead can pave the way to a stronger Puerto Rico,” said Carrión.
Governor-elect Ricardo Rosselló supports the fast pace of the plan.
During the meeting, the PROMESA Board also adopted key principles for its evaluation of Governor Garcia Padilla’s Fiscal Plan and a timetable for the governor to submit revisions. The Board previously developed a review process for all intended transactions that are outside normal everyday business. Such transactions will require an explanation of the value to Puerto Rico and why they are in the public interest, including statements from the governor and from the chief executive of the company involved in the transaction.
The meeting included presentations and discussions on the fiscal plan, and there was a general sentiment that the current plan is not compliant with PROMESA. Governor Garcia Padilla has since announced that he will not submit a new plan as requested.
Six other entities have been asked by the Board to draw up their own fiscal plans. Secretary of State Victor Suárez appeared at the meeting to provide updates on the progress of those entities on the plans.
The meeting was livestreamed at the PROMESA website. As of this writing, the video of the meeting has not yet been posted, but it is expected that it will be available at the web page hosting the earlier meetings’ videos.