Through a letter, the JSF requested documentation from the Puerto Rico Highway and Transportation Authority (ACT) regarding the use of funds from the Puerto Rico Authority following failure to comply with Second Revised Budget Agreements (FY 2024).
The budget, adopted on December 8, 2023, notes in Section VII the funds transferred to the ACT, in accordance with the agency's Plan of Adjustment (PoA) released by the Bank of New York Mellon (BONY).
These funds were transferred to the Capital Region “following the payment of its debts due on December 14, 2023, in accordance with the concession agreement between the Capital Region and Puerto Rico TollRoads LLC (Transaction P3).
The section states that ACT “shall notify the Oversight Board in writing within ten (10) days after specific funds are made available to ACT, along with a proposed plan for their potential uses. Additionally, Section VII requires written authorization from the Oversight Board prior to any expenditure Or use of these funds.
The Board of Directors requested the following information from ACT Director, Dr. Edwin Gonzalez Montalvo.
Amount of funds released:
ACT must provide written confirmation of the final amounts transferred from BONY Program accounts after debt recovery. This includes details about fees charged by guardian entities.
Likewise, they must provide details on how funds will be segregated “to comply with the provisions of the DC Second Amendment Budget Act for the fiscal year.
Use of funds:
The ACT must provide a breakdown of expenditures actually incurred and covered by work program funds, details of current or future expenditures, and an updated balance and monthly report identifying income and interest generated in each work program account.
In the letter, the board acknowledged that the T-Law complies with “certain other obligations of the Second Revised Budget. However, they asserted that the T-Law “failed to provide notice and proposed plan for potential uses, as required by Section VII.”
“The Oversight Board requested follow-up information under Section VI (including confirmation of the amount of funds generated from P3 transactions and used, if applicable, to replenish the account for emergencies and unforeseen events) and Section VII. In response, HTA informed the Oversight Board that, to maximize interest income , the funds available to HTA pursuant to Sections VI and VII were transferred to the same account used to deposit the proceeds of the P3 transaction. “While the Oversight Board supports the justification for depositing funds into said account, HTA’s response did not meet the requirements set forth in Section VII of the HTA budget,” the letter read. Second revision for fiscal year 2024.
“As stated in ACT’s cash balance report dated December 29, 2023, which was submitted to the Oversight Board on January 12, 2024, approximately $101,439,456 was provided under ACT’s work program accounts. ACT subsequently confirmed that program funds were being used These expenditures and uses have been made, and continue to be made, without the prior written authorization of the Oversight Board, as required by Section VII of the ACT's Second Revised Fiscal Year Budget 2024.
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