Puerto Rico's government has located about $2 billion in funds that it may use to cover essential services.
The commonwealth government is in the midst of a financial crisis; it defaulted on over $800 million of debt on July 1.
The Puerto Rico Office of Management and Budget and the Puerto Rico Treasury Department has located the money in 150 segregated accounts outside the General Fund, said OMB Director Luis Cruz Batista. The accounts were set up as long ago as the 1960s.
Some examples are the Children Health Fund, Death in the Line of Duty Fund, Special Fund for Forestry Development, and Educational Opportunity Fund.
Use of the funds is restricted by law, Cruz Batista said. However, it is possible that Puerto Rico Gov. Alejandro García Padilla may call for a special session of the legislature before the end of the fiscal year to consider legislation to allow the use of the funds for general purposes.
If the government uses some or all of the segregated account money, it would not be the first time that the government drew upon normally sacrosanct pools of money. In the last fiscal year, which ended June 30, the government drew about $400 million from three commonwealth-run insurance funds.
The Puerto Rico government proper has allocated no funds in its current fiscal year approved budget for its general obligation or other debts. In late June Bloomberg reported the government owes suppliers and contractors $2 billion. In the spring the El Vocero news web site quoted Cruz Batista saying that Puerto Rico owed $1.39 billion in total debt in fiscal year 2016-2017, which is now the current fiscal year. Of this $1.013 billion was general obligation debt.
The current year's approved budget is $8.987 billion.
