Puerto Rico Oversight Board submits $10.1 billion budget to legislature
The Financial Oversight and Management Board for Puerto Rico approved the proposed General Fund budget for the Commonwealth of Puerto Rico’s fiscal year 2022 (FY2022) and submitted it to the Legislature for its consideration. FY2022 starts on July 1, 2021. The $10.1 billion proposed FY2022 General Fund budget for the Puerto Rico Government’s day-to-day operations increased slightly from the previous year’s budget. The FY2022 budget allocates 72% of funding to the priorities of education, public safety, health, economic development, and pension payments.
The FY2022 budget includes $273 million in specific funding requested by Governor Pedro Pierluisi (NPP, D). The budget allocates $454 million for social programs, including $167 million in family and children support programs, $70 million in scholarship funds for students and medical residents, and $11 million to fight gender violence. The budget includes $15 million to hire additional school nurses and $10 million to fund the treatment of opioid addiction. The budget also includes $450 million rolled over from FY2021 to improve broadband infrastructure in rural areas.
“Governor Pierluisi and the Oversight Board worked together to establish a fiscally responsible budget for Puerto Rico with significant funding for social programs such as fighting child poverty and gender violence, social work, public safety, education, and healthcare while maintaining the fiscal balance required under law,” said the Oversight Board’s Executive Director Natalie Jaresko. “Fiscal responsibility is not austerity. Fiscal responsibility is prioritizing taxpayer money and using it efficiently and responsibly to maximize the services and programs the people of Puerto Rico need
and deserve. The FY2022 budget focuses on these priorities and ensures their funding.”
The FY2022 budget also includes $12 million for the civil service reform pilot to ensure the Puerto Rico Government can provide quality services to Puerto Rico’s residents for years to come. The pilot is part of the Certified Fiscal Plan, aiming to align the Government’s workforce capabilities and organizational structures; enable the Government to better recruit and retain the right talent; augment employee development through standardized training; optimize human resources technology, compensation structures and policies; and redesign performance management and succession planning to promote employee development.
The FY2022 budget fully funds the public employees’ pension through the Paygo system that replaced the insolvent pension trust. The budget also includes Medicaid funds for which the US Congress has not yet extended incremental funding to ensure the continuation of much-needed healthcare programs.
The FY2022 budget also includes necessary measures required under the Certified Fiscal Plan to improve fiscal sustainability as mandated under PROMESA, make Puerto Rico’s government more efficient, and reflect Puerto Rico’s declining population.
The General Fund budget does not include special revenue funds, which are comprised of revenue the government generates from fees and services dedicated to particular uses, or federal funds. The Oversight Board will be working with the Legislature between now and June 18, 2021 when the Legislature submits its proposed budget to the Oversight Board for consideration. The members of the Oversight Board will certify the completed FY2022 budget by June 30, 2021.