Puerto Rico Governor gives territorial budget address

by | Jun 8, 2017 | Headlines, Puerto Rico | Comments

On June 1st in San Juan at the Legislative Assembly, Governor Ricardo Roselló presented the budget for the fiscal year of 2018 for the territory. In his address he announced a $9.6 billion budget.

During his speech, Roselló spoke of some of the details of the budget, however, it has not been released for review. The budget is said to be balanced, and will preserve payments to the territory’s pensions. The budget is also in compliance with the Financial Oversight & Management Board’s requirements, but the extent of cuts and austerity measures imposed by the board onto the budget are not yet clear. What is known, is that the budget reduces government spending by 40%, and payroll expenses by 13%, but still manages to reduce taxes. It also creates a special fund to avoid employee furloughs.

The budget also pledges around $2 billion to cover the territory’s pensions. In order to cover the costs of the pension spending, the budget proposes to eliminate millions in annual subsidies to its municipalities. On the downside those subsidies helped to pay for government run services, such as trash collection, which some mayors are not charging for.

The budget is still not final, it must be approved by the Puerto Rican legislature, however, it is not expected that they will make big changes. They must make the decision by July 1st.

The budget address did not come without criticism. Many have criticized the fact that a full copy budget has not been released for public consumption. Opponents were quick to criticize the governor for not releasing the budget, citing that it creates a lack of transparency, and is confusing for constituents who still don’t know what exactly is being cut. Others criticize the budget simply for complying with the Oversight Board, which is accused of being a colonial institution and forcing inhumane austerity measures.