Sixteen months after Hurricane María hit Puerto Rico, the United States Department of Housing an Urban Development (HUD) released the first $ 1.5 billion reconstruction funds package under the Community Development Block Grant for Disaster Recovery Program (CDBG-DR).
This release of funds comes after a series of controversies over the federal government allegedly intending to withhold funds.
The funds will be used for the reconstruction of houses, relocating communities in risk areas, granting of property titles and commercial loans. In addition, they will be used to market Puerto Rico as a tourism destination and the implementation of resilience initiatives, among other efforts approved by HUD.
US Housing Secretary Ben Carson announced the release of the package during an interview with the New York television network NY1. As soon as the information was released, Governor Ricardo Rosselló Nevares issued a statement confirming access to the funds that had been allocated in the weeks after the passage of Hurricane María, on September 20, 2017.
In his statement, the governor stressed that this action represents an endorsement “of the work we have been is doing. In addition to being a sign of confidence and credibility for the performance we have shown since day one.”
However, Carson did not express himself in the same way. Instead, during the NY1 interview, he said that the $1,5 billion has been released “as of this week, and it´s going to take them a long time to spend $1.5 billion dollars, believe me. But it´s very important that given the history of finances in that area, that we are extremely diligent about the financial controls that are put in place and obviously we are going to be watching very carefully how that first $1.5 billion dollars is spent.”
The first $ 1.5 billion is the first of two federal CDBG-DR packages to address the damage caused by María. The second package totals $ 18,5 billion, but due to the amount, this allocation was divided into two parts.
HUD is evaluating the action plan submitted by the Puerto Rican government over the use the first portion of the $18,5 billion.
The Federal Emergency Management Agency (FEMA) and the U.S. Army Corps of Engineers, among other dependencies, are in charge of the rest of the funds.
A slow release
In September, when the action plan for the first $ 1.5 billion through the CDBG-DR program was authorized, they said that these funds would be available almost immediately to begin reconstruction efforts.
However, the official release –through a established line of credit- took months. The official version is that measures were being taken to improve the funds management capacity of the government of Puerto Rico.
However, according to Politico and The Washington Post, other sources point to the fact that the White House tried to block or stop relief funds for Puerto Rico.
In fact, sources quoted by The Washington Post assure that HUD Deputy Secretary Pam Patenaude´s resignation was partly the result of the White House's attempt to block reconstruction funds for Puerto Rico.
The resignation of Patenaude came just after HUD - with the assistance of federal officials - completed all the administrative requirements for the disbursement of funds. Patenaude, however, did not complete the assessment process of the action plan for the second portion of CDBG-DR funds.
In his interview with NY1, Carson described the administrative process as one of technical assistance to "ensure that the needs of the people of Puerto Rico are met."
The federal official also minimized the effect that Patenaude's resignation may have on the process of evaluating the plan for the use of the second portion of disaster relief funds.
He said that he has “excellent people in place” who are competent and experienced “so I am not concerned about that.”
La Fortaleza press release included statements by the Secretary of the Department of Housing of Puerto Rico Fernando Gil Enseñat who explained that three notifications were received from HUD informing the release of 80 percent of the funds.
Once that portion of the funds is used, the rest would be released, HUD spokesperson Leticia Jover explained later.
Gil Enseñat stated that, as part of the process, “the Yardi financial program was approved through a non-competitive purchasing process which allows managing funds with an existing system while saving millions of dollars,” while reducing the time to ensure that the money reaches Puerto Ricans as quickly as possible.
The process of approval and management of CDBG-DR funds was delayed due to the partial U.S. government shutdown that paralyzed 25 percent of federal operations between the end of December and part of January.
In the past, Rosselló Nevares said that delays in the reconstruction process do not respond to delays in the process with HUD but to obstacles imposed by FEMA in the process of evaluation, adjustment and approval of funds.
The governor denounced that FEMA treated the island as a high risk jurisdiction in funds management even though the government does not hold such a category.
Similarly, the Federal Office of Management and Budget (OMB) recently objected budget allocations to address debris removal and extend nutrition assistance for those affected by the hurricanes that hit Puerto Rico in 2017.