Showdown intensifies: Board rejects Rosselló’s budget

The Federal Financial Oversight Board rejected the budget presented by Governor Ricardo Rosselló and gave him five days to deliver one that includes labor reform, eliminates the Christmas bonus for public employees and guarantees the Board’s own budget increase, El Vocero reported.

In a letter signed by executive director Natalie Jaresko, the Board said the budget submitted the prior Friday does not comply with the already approved fiscal plan and lacks a long list of requested information. Christian Sobrino, the Executive’s liaison to the Board and AAFAF board chair, said the government might present changes, but not on the most sensitive points.

“We are not going to increase the Board’s budget, we are not going to cut the budget of independent offices such as the Comptroller’s Office, Government Ethics or the Legislature, we are not going to remove the Christmas bonus, we are not going to include labor reform and we are not going to include additional powers for the Board beyond sections 202, 203 and 204 of PROMESA,” Sobrino said.

According to the letter, the budget does not include cuts to agencies such as the Comptroller and the Legislature to create a scholarship fund for the UPR, nor what the government would receive from private-sector labor reform. The Board objected to other reserves beyond the fiscal plan’s $130 million emergency reserve and $3.5 million — instead of $114 million — in federal Clean Water Act funds, plus a $33 million line for police to begin contributing to Social Security.

The governor had submitted an $8.79 billion budget. PROMESA allows that, once the Executive amends, the Board may present another budget to the Legislature; the calendar pointed to before May 22. If no new one is approved, the Constitution contemplates operating under the current one — with Christmas bonus, without labor reform and with about $60 million for the Board. Rejection is not certification or disbursement.