CPI: blank check — PPP / Senate Bill 469 without a development plan

On June 1, 2009, the Centro de Periodismo Investigativo (CPI) warned that Senate Bill 469 — a Public-Private Partnerships (PPP) framework — would give Governor Luis Fortuño free rein to privatize assets or services without an economic development plan or concrete goals, after reviewing the 71-page text and consulting experts. The measure, part of a trio of laws tied to a possible general strike that week, went to a House vote without substantial amendments even though on May 23 Government Commission chair Carlos “Johnny” Méndez had told CPI they would integrate about ten amendments (retirement, cooperatives, schools, sale of improvements).

CPI stresses that the statute allows transfers for up to 75 years; does not set mechanisms to guarantee more cost-efficient services; and concentrates discretion in the BGF president, the Treasury secretary, the Planning Board chair and, ultimately, the Governor. It creates the Public-Private Partnerships Authority (attached to BGF) with an initial $20 million BGF credit line and later PPP contract revenues. PPP funds could be used for PPP processes, “any debt” of the Government and a capital-improvements fund as the Governor decides after BGF recommendation.

Professor Carlos Díaz Olivo (UPR) called the broad drafting without a prior plan a “danger”; planner José Rivera Santana said the design allows awarding partnerships “in a discriminatory way” and noted exemptions from basic bidding, contracting, monopoly, government accounting and administrative-review laws. Gustavo Vélez estimated the policy can work if executed with prioritization and without losing heritage or jobs. CPI lists minimum qualification requirements and notes the Authority may negotiate without an RFP when it deems that onerous, when initial value does not exceed $5 million or one year, or there is a sole source.

Legislative approval of the framework ≠ PPP contracts already signed nor privatization consummated. BGF credit line ≠ disbursement to private operators. CPI analysis ≠ litigation. Primary: CPI 2009-06-01.

Source: Centro de Periodismo Investigativo. https://periodismoinvestigativo.com/2009/06/cheque-en-blanco-que-puede-salir-caro-2/