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At the center, Governor Vázquez Garced. (GFR Media)
At the center, Governor Vázquez Garced. (GFR Media)

Washington - The government of Puerto Rico is waiting for answers from the U.S. Department of Education and the Oversight Board regarding its proposal to leave the fiduciary agent responsibilities in the hands of the fiscal entity.  The U.S. Department of Education ordered the Puerto Rican government to hire an external entity –kind of a trustee- to manage the nearly $ 650 million in federal education funds.

Both Governor Wanda Vázquez Garced and Education Secretary Eligio Hernández sent letters to the U.S. Department of Education advocating for the Board, which already oversees the elected government’s financial decisions, to assume the task that the federal government decided to entrust to a company hired by the island’s Education Department.

Hernández said that was not the only issue they raised.

Although they were not made public, the letters were sent to the U.S. Department of Education after the governor's first meeting with federal Education officials on September 9.

After that meeting, Governor Vázquez Garced told El Nuevo Día, for the first time, about the request made for the Board to replace the fiduciary agent that the federal government intends to hire.

For the Vázquez Garced administration, a federal trustee will not only cost millions of dollars to the Department of Education in times of fiscal crisis, but it is not justified. Hernández said, there has been a consistent reduction in the administrative inefficiencies the federal audit found.

On June 28, the U.S. Department of Education ordered the government of Puerto Rico to hire an external entity to manage about $ 650 million in federal funds, after they found administrative inefficiencies in the Puerto Rico Department of Education's Office of Federal Affairs..

The order was issued two weeks before corruption charges against former Education Secretary Julia Keleher, her assistant Glenda Ponce Mendoza and Education Department contractors.

Although without offering details, Hernández said that one of the questions by the U.S. Department of Education was that a significant part of federal funds was not used in fiscal year 2017-2018, which the Secretary attributes to the devastation caused by Hurricane María that kept schools closed or serving as shelters. "We were paralyzed for six months," he said.

Hernández noted they warned the U.S. Department of Education that they have never ordered the appointment of a fiduciary agent in a jurisdiction that also has a Board overseeing financial decisions of the elected government. According to Hernández, they fear to be in the middle of contradictory requirements by the Board and the federal trustee.

For example,he mentioned that they warned the Board that there are education programs that require the same level of state allocations in order to access federal funds.

Hernández said that, so far, he has only discussed the issue with the Board team. "What we have done is share preliminary information (with the Board), so that they learn about the Department special conditions and about the requirements they are imposing on us," the Secretary added.

The process continues

However, Hernández acknowledged that the process aimed at publishing a request for proposals seeking a fiduciary agent to perform oversight services continues. They have had regular meetings with the U.S. Department of Education officials since July.

In early August, Hernández told El Nuevo Día that the selection process for the company to perform oversight services for the federal government could take about three months. In an interview on Tuesday, Hernández didn’t want to set a specific date. "We cannot offer information because it is privileged and confidential until the call is published," he said.

Recently, Popular Democratic Party (PPD) House Minority Leader Rafael "Tatito" Hernández questioned whether the Board should have responsibilities not included in PROMESA Act.

Among other things, he fears that the Board may end its work under PROMESA and still have responsibilities over federal education funds.