Approved fiscal plan says Puerto Rico won't face budget deficits until 2048

The Financial Oversight and Management Board on Thursday approved a revised fiscal plan that states Puerto Rico won’t face budget deficits until 2048 because of the incorporation of federal funds allocated by the U.S. Congress.

The previous fiscal plan estimated that Puerto Rico could face budget deficits by 2036. The information was provided by the oversight board’s executive director, Natalie Jaresko. According to board estimates, Puerto Rico’s incremental net surpluses from healthcare funding and the improved economic environment will be $2 billion in fiscal year (FY) 2023, $1.96 billion in FY24, $1.78 billion in FY25, $1.71 billion in FY26 and $1.71 billion in FY27.

“Program costs that were previously forecast to be funded by commonwealth resources are now being paid by the federal government instead,” Jaresko said.

The board has previously said the government must also start reducing government agencies.

Jaresko also said she expects the debt restructurings of the Puerto Rico Electric Power Authority (PREPA) and Highways and Transportation Authority (HTA) to happen this year. PREPA’s debt adjustment plan is expected to be submitted in March. Jaresko said local legislation to enable the debt deal was needed for PREPA but was not needed for the restructuring of the HTA. Oversight board member Justin Peterson intervened to say PREPA’s restructuring could also be done without the need for commonwealth legislation, including the bond exchange and the imposition of a transition charge.

Read more: https://www.sanjuandailystar.com/post/approved-fiscal-plan-says-pr-won-t-face-budget-deficits-until-2048