Mismanagement in municipalities is hurting Puerto Ricans

by Aug 22, 2016Headlines, Puerto Rico0 comments

Currently at the forefront of Puerto Rican news is PROMESA and the territory’s struggle with its over $70 billion in debt. There are many different opinions on how to best address Puerto Rico’s debt crisis but one consensus is that the debt is there and the unmitigated growth of debt must be stopped. How such an amount of debt was accumulated is a complex question with a complex answer pointing in many different directions. One direction to look, however, is the smaller or local government systems within the territory or municipalities.

Puerto Rico is divided into 78 municipalities with mayors who oversee the operation of their respective communities. In recent years, however, a waste of public money has arisen within these areas. Each mayor must create and submit a budget for his municipality’s expenses for approval by the municipality’s legislature. Recently, large sums of money have been allocated to public works within the municipalities that look good to voters especially in election years. While certain public works are certainly necessary in these communities, many of the projects currently under construction are either not necessary, or not able to be used. Essentially the government is wasting money on creating projects that neither benefit the community or are constructed in the first place.

In conjunction with these wasteful projects is a general lack of proper use of budgets. Many municipalities end the fiscal year with either a surplus of funds or in deficit. In 2011, over 50% of all municipalities cited some sort of deficit according to a recent report by the Comptroller of Puerto Rico. As stated by Mario Negron-Portillo, former director of the University of Puerto Rico’s School of Public Administration, “The majority are bankrupt, and they keep living off the central government that maintains them, and the central government doesn’t have money now, either; it’s a Catch-22.” One possible solution to this debt issue is combining multiple smaller municipalities into a larger one to reduce the number of mayors and legislators requesting funds. This could reduce the strain on the central government as well as allow for better allocation of funds and more successful programs for the citizens of these areas.

The current improper spending, however, is immediately hurting the citizens of these municipalities who are in need of a proper allocation of funds to projects that actually assist the community. Generally, it appears as though more oversight by the territory’s senate over mayors and their budgets, as well as projects, must take place. Through closer oversight and restrictions not only would the strain on the central government be less but also these municipalities would be more productive with the funds available and truly focus on what is important within their communities.

Additionally, in municipalities with deficits, studies found a large amount of public debt. This means that the irresponsibility in budget creation and allocation is ongoing, and directly hurting the communities which these projects are supposed to be benefitting. An increase in public debt makes the territory’s economic crisis even more precarious. Clearly more and immediate oversight over local municipalities and mayors by the territory’s Senate is necessary to begin to establish responsible spending within these municipalities. By ensuring that projects directly benefit citizens, are completed in a timely and cost effective manner, and useful for the communities after construction, much of the wasteful spending currently present could be drastically reduced.

photo credit: 100 U.S. DOLLARS – MONEY – Free For Commercial Use – FFCU via photopin (license)