Republicans argue that Puerto Rico board should be given control of PREPA

Register now

Two Republican representatives in Congress argued that the Puerto Rico Oversight Board should be given additional powers over the Puerto Rico Electric Power Authority.

Rob Bishop, R.-Utah, and Bruce Westerman, R.-Ark., sent out a written statement Monday evening arguing for these powers, hours after federal Judge Laura Taylor Swain ruled that the board didn’t have the power to replace PREPA’s current executive director.

After Hurricane Maria hit Puerto Rico on Sept. 20, “it is obvious PREPA did not know how to draft a FEMA-compliant contract, nor did PREPA officials adhere to the advice of their own counsel on how to comply,” said Westerman, Chairman of the Subcommittee on Oversight & Investigations in the House Natural Resources Committee. “I believe this is precisely why the Oversight Board should be granted more authority. While we understand the sense of urgency for the people of Puerto Rico, oversight and transparency are vital to this recovery process.”

Rob Bishop, chairman of the House Committee on Natural Resources, said, “A legacy of dysfunction (at PREPA) has created a competence deficit that threatens the island’s ability to improve conditions for its citizens. Confidence in the utility’s ability to manage contracts and time-sensitive disaster related infrastructure work is long gone.”

The Oversight Board announced its plan to appoint Noel Zamot to replace current PREPA leader Ricardo Ramos just a day or two after board members met with Rep. Bishop, according to a Bishop spokesperson.

At a Committee on Natural Resources hearing on Wednesday Bishop continued to call for more outside control over Gov. Ricardo Rosselló’s government.

“The lack of institutional controls … raises grave concerns about the government of Puerto Rico’s ability to competently negotiate, manage and implement infrastructure projects without significant independent oversight,” Bishop said.

“One of the things that I think we’re walking into here is a tremendous credibility gap, based on Whitefish and other subsequent decisions that are going on here,” Bishop said, according to The Hill news website.

The “Whitefish” that Bishop was referring to was Whitefish Energy, retained by PREPA to help fix the island’s electrical grid. Observers have questioned the adequacy of the company’s experience, the fact that it is based in the same Montana town as the U.S. Secretary of the Interior, and the rates it is charging to Puerto Rico.

Prior to Wednesday’s hearing, Rosselló released a request to the federal government for $94 billion in medium- and long-term aid for recovery from hurricanes Irma and Maria.

“You’re asking for an unprecedented $94 billion,” Bishop said at Wednesday’s hearing, according to The Hill. “That’s a lot of money. That’s not going to happen unless people are going to see some changes in the way cooperation is made, and the way that money’s going to be spent.”

On Wednesday PREPA executive director Ricardo Ramos explained to the U.S. Senate Energy and Natural Resources Committee the process the authority used to hire Whitefish Energy to repair Puerto Rico’s energy grid.

Ramos said after Hurricane Irma hit on Sept. 6, six private companies provided offers to PREPA to aid with restoring the grid. All six companies offered similar hourly rates.

While only 25% of the island had electrical service immediately after Irma this improved to 96% the day before Maria, Gov. Ricardo Rosselló told the Senate Energy and Natural Resources Committee.
Immediately after Maria hit, Ramos said he had limited communications ability and didn’t become fully aware of the extent of Maria’s damage to the electrical system for a week.

Use of state mutual aid for restoring the grid would have required PREPA to provide accommodations, food, communications and other logistics to the incoming crews because this was part of the mutual aid policies. Ramos said that in the immediate aftermath of the storm PREPA couldn’t do this.

Ultimately, Ramos decided between using another company that was asking for $25 million up front and Whitefish which was willing to get paid when the work was completed. Ramos authorized the use of Whitefish and chose to continue to look for other options.

At the start of Wednesday’s Senate Energy and Natural Resources Committee meeting on the hurricanes' impact on Puerto Rico and the U.S. Virgin Islands, committee chairwoman Lisa Murkowski, R.-Alaska, said she thought it didn’t make any sense to spend hundreds of millions of dollars of Stafford Act funds to rebuild the electric grid as it had been in Puerto Rico and the Virgin Islands prior to the hurricanes. She said this would only set it up to be later blown down again.

Later that morning, Rosselló told the committee he was seeking $17 billion of these funds for restoring and hardening the electric grid.

For reprint and licensing requests for this article, click here.
PROMESA Revenue bonds Utilities Puerto Rico Electric Power Authority Commonwealth of Puerto Rico University of Puerto Rico Puerto Rico Employees Retirement System Puerto Rico Industrial Development Co Puerto Rico Aqueduct & Sewer Authority Puerto Rico Public Finance Corporation Puerto Rico Public Buildings Authority Puerto Rico Highway & Transportation Authority Puerto Rico Infrastructure Financial Authority Puerto Rico