The Puerto Rico Oversight Board, at an initial meeting that was interrupted by protests, named José Carri-n III chairman and ordered the island government to provide a fiscal plan in October.
Carri-n was one of four members nominated to the board by Congress's Republican leadership. The board approved his appointment by a vote of 7-0. No one else was nominated.
"We will strive to work in a collegial matter for the benefit of the people of Puerto Rico," Carri-n said after taking over as chairman at the meeting in New York. Carri-n had been an official in the administration of Luis Fortuño, the prior governor.
This first act was echoed by 7-0 votes on all the other matters in front of the board.
Board member David Skeel introduced the bylaws. He said the board created them to be consistent with the Puerto Rico Oversight Management and Economic Stability Act. The board also worked to clarify the rules on voting. Ordinarily, measures will have to be passed with four votes even if not all the seven board members are present.
For the vote for appointing an executive director and general counsel, the chairman and four others must approve them, Skeel said. This was because they will face a heavy workload and the board wants to have something near a consensus on them.
The board also voted to direct Puerto Rico's government to provide about eight types of fiscal and financial information to the board regularly. In the same vote it directed the government to provide a fiscal plan to the board by Oct. 14 and for the governor or his representative to present the fiscal plan to the board at the board's next meeting in mid-October.
According to PROMESA the fiscal plan is to be a five year government plan that will, among other things, provide an approach to fiscal responsibility, access to capital markets, fund essential public services, funding for pensions, and a sustainable debt burden.
In the midst of the presentation of the board discussions of the request for the plan and the information, a member of the audience said, "Sounds like slavery to me." A few minutes later he started denouncing the board and someone else in the audience yelled out, "No to these [expletive] promises!" The first protestor yelled "They are selling us out." A third yelled, "Puerto Rico has been a colony for 100 years!"
Security personnel led these three men and two others who accompanied the first man out of the auditorium.
The board assigned members the task of hiring an executive search firm to hire an executive director and a general counsel.
After the meeting, Carri-n acknowledged that the board had made several key decisions before Friday's meeting at a meeting with the U.S. Treasury in prior weeks. He said the board would try to be as transparent as possible going forward. Documents would be posted to the web site. The meetings will be streamed live from the board's web site:
In response to a question as to whether the board indicates Puerto Rico is a colony, Carri-n said a bipartisan process in both Puerto Rico and the United States set up the board.
Carri-n said the board needed to have a good relationship with Puerto Rico's current and future government. Whoever is elected to be governor in November, the board hopes to sit down with and make decisions with, he continued.
A main office for the board will be in San Juan, Puerto Rico, Carri-n said. However, for the time being board meetings will be held in New York City because it is easier for members to get to.
The board is currently scheduled to hold its first Puerto Rico meeting in mid-November.
The night before the meeting, Puerto Rico Gov. Alejandro García Padilla said, "I did not agree either with the excessive powers given to the board nor with several appointees to it." He said that he had to agree to it because the alternative would have been catastrophic for the government's provision of human services. He added that the board was a product of years of unwise government borrowing and the economic contraction that Puerto Rico has experienced in the aftermath of a federal change in tax laws.
Among other things, the governor said he presented the board with a study showing the "terrible consequences" that would be attendant with austerity measures.
The governor said he had appointed municipal finance expert Richard Ravitch to argue for the interests of Puerto Ricans.
After the meeting, García Padilla said the naming of Carri-n as chairman was a positive step. "We are pleased that it is a Puerto Rican, with knowledge of the economic situation the commonwealth has faced since 2006, who has been designated to chair this body."
