La solution s’estompe

On May 1, 2006, El Nuevo Día (Magdalys Rodríguez) reported the first mass agency shutdown in the country’s history: 45 agencies closed completely and 15 partially, temporarily leaving about 95,762 public employees without work. The note says what was expected as a solution to the budget standoff faded overnight when a near-deal among the Senate, several New Progressive Party mayors and Governor Aníbal Acevedo Vilá collapsed over the NPP House majority’s reluctance.

The tabled agreement was to authorize a $532 million loan repaid with a 5.9% sales tax. Preliminary revenue-sharing stumbled because Acevedo Vilá opposed the government receiving 3.8% for only one year and then tapering it for municipalities; he would accept the offer — pushed by Resident Commissioner Luis Fortuño — if guaranteed three years at that 3.8%. Mayors of Bayamón, Guaynabo, Toa Baja, Ciales, San Sebastián and Cataño had agreed to leave 1.1% to municipalities (not the original 7% scheme’s 1.5%) and 3.8% to the treasury to replace 6.6% revenues and shrink the deficit.

NPP representatives (Rivera Aquino, Crespo, Albita Rivera, Liza Fernández) warned overnight they might withdraw their names from authorship of the tax reform. Fortuño joined a House caucus; McClintock, at 5:00 a.m., said doors to a possible deal remained “ajar.” The Senate recessed until 3:00 p.m. and the House until 5:00 p.m.; Acevedo Vilá met agency heads at La Fortaleza from 6:30 a.m.

In the Senate there was an altercation between Jorge de Castro Font and Norma Burgos over amendments to a House measure authorizing GDB a $532 million credit line secured by an additional 5% tax on corporations with more than $10 million income in the last tax year. McClintock alleged impairment of contracts (decrees); María de Lourdes Santiago held the levy falls on taxable income. The Senate passed a resolution assigning $114.5 million to eleven agencies; the House, an Aponte measure to take $532 million from GDB capital, citing that GDB had given $500 million to Special Communities under Sila Calderón.

Rafael Feliciano (Teachers Federation) and Ricardo Santos (UTIER) visited legislators: “we are hostages of a sales-tax imposition.” Santos urged people not to stay home: UTIER picket at PREPA and a 4:00 p.m. protest at the Labor Department. Shutdown / proposed loan ≠ executed disbursement. Failed negotiation ≠ judgment.

Source: El Nuevo Día. http://web.archive.org/web/20060514001517/http://www.endi.com:80/2006/05/01/index/413142.asp