Washington - Senator Bernie Sanders (Vermont) and Representative Alexandria Ocasio Cortez (New York) and 11 other Congress members - called yesterday on the Oversight Board to explain, within two weeks, potential conflicts of interest and explain the austerity measures they imposed on Puerto Rico.
In a letter sent yesterday to the Board, federal lawmakers asked for answers by October 7 and that the entity that oversees the financial decisions of the island's elected government begins by reversing measures that have reduced public spending for essential services.
Among other things, they demanded “a detailed explanation for the increasing fiscal surplus available to creditors,” as well as an “analysis of the expect impact of the FOMB´s budget cuts to health and education expenditures on Puerto Rico´s economic growth trajectory, outmigration and inequality,” and pensions.
They also requested financial disclosures of each member of the Board and all documents related to entity´s consulting agreements with companies that “could financially benefit from an eventual debt repayment deal” such as McKinsey Company and Citigroup Global Markets.
As for Board members, they requested for a “full accounting of each member’s professional or familial ties to any institutions and people who hold Puerto Rico’s debt or maintain contracts with the FOMB, and thorough financial disclosures of each board member, including details of outside compensation.” They also requested all material related to the Board's public policy on conflicts of interest.
The eight senators and five representatives who signed the letter - all Democrats - said they wrote in support of “the hundreds of thousands of Puerto Ricans who took to the streets to demand accountability from their government and compelled Governor Rosselló Nevares to step down.”
"His administration's corruption and deeply offensive comments toward women, LGBTQ people, people of color and victims of Hurricane María were unacceptable, and we are encouraged by his (Rossello's) resignation. It is clear, however, that this historic and inspiring mobilization goes far beyond one individual. The people of Puerto Rico seek democratic control over their future, and called not only for the resignation of Governor Rossello but for the end of the Financial Oversight and Management Board's (FOMB) control over the economic decisions of the island," they said.
The letter is signed by Sanders, an independent senator; Puerto Rican Congresswoman Ocasio Cortez; Senators Elizabeth Warren (Massachusetts), Cory Booker (New Jersey), Ed Markey (Massachusetts), Jeff Merkley (Oregon), Kirsten Gillibrand (New York), Richard Blumenthal (Connecticut), Robert Menéndez (New Jersey) and Congress members Adriano Espaillat (New York), Jesús "Chuy" García (Illinois), Pramila Jayapal (Washington) and Mark Pocan (Wisconsin).
Sanders, Warren, and Booker are Democratic presidential candidates.
According to sources, through the Environment subcommittee of the House Committee on Oversight and Reform, Ocasio Cortez plans an official trip to Puerto Rico in October, which may include a public hearing and several visits.
Members of Congress questioned that the fiscal plan adopted by the Board focuses "on producing a significant fiscal surplus," prioritizing the demands of "Wall Street vulture funds over the needs of the Puerto Rican people."
"The anticipated surplus has more than doubled since the FOMBS's first Fiscal Plan was published, despite there have been few changes to the board's underlying assumptions," senators and representatives warned in their letter, first published by The Intercept.
They also questioned restructuring agreements, which they consider as “far more generous” than what the Board's “own long-term estimates indicate that Puerto Rico is able to pay.”
Regarding the contract with McKinsey, federal lawmakers recalled that one of its subsidiaries, Mio Partners, had Puerto Rico bonds.