The Trump administration on Wednesday imposed severe restrictions on billions of dollars in emergency relief to Puerto Rico, including blocking spending on the island’s electrical grid and suspending its $15-an-hour minimum wage for federally funded relief work.
The nearly $16 billion in funding, released while Puerto Ricans still sleep on the streets for fear of aftershocks from last week’s earthquake, is part of $20 billion that Congress allocated for disaster recovery and preparation more than a year ago, in response to the territory being hit by back-to-back hurricanes in 2017.
The Department of Housing and Urban Development had released only $1.5 billion of the congressional relief, citing concerns of political corruption. Of that, only $5 million has been allocated.
“In a great win for Puerto Ricans and U.S. taxpayers, the Administration has outlined reforms for the grant agreement to Puerto Rico in order to protect resources,” said Chase Jennings, a spokesman for the Office of Management and Budget at the White House.
Rep. Nydia M. Velázquez, D-N.Y., the first Puerto Rican woman elected to the House, called the move disdainful and contemptuous.
“Why is Puerto Rico always subjected to different standards when it comes to this administration?” she demanded.
President Donald Trump has clashed repeatedly with Puerto Rico’s government. In 2018, he suggested the death toll from Hurricanes Irma and Maria had been inflated “in order to make me look as bad as possible.” He has exaggerated the amount of federal relief allocated to the island and denounced the mayor of San Juan as “crazed and incompetent.”
Even as pressure has mounted for him to release emergency assistance, the president has maintained his assertions that the money will not be well spent. On Wednesday, the White House budget office made clear how those assertions had shaped relief.
To access $8.2 billion in recovery money and $8.3 billion in disaster prevention funds, Puerto Rico will have to submit budget plans to the territory’s federally mandated fiscal control board, which will track where the money goes. It will also have to bolster its property registration database.
Puerto Rico will be barred from paying its $15-an-hour minimum wage to workers on federally funded projects. And none of the funds can be used on the electrical grid, although the Department of Housing and Urban Development has yet to release nearly $2 billion that was allocated for Puerto Rico’s electrical system.
White House officials acknowledged rolling blackouts continue on Puerto Rico but insisted there was no need for new money.
The requirements were first reported by The Washington Post.
A congressional aide involved in the issue said the White House and its budget office appeared to have chosen restrictions that would be politically difficult for Puerto Rican officials to carry out. That way, the aide suggested, the federal government would not appear responsible for withholding the aid.
For example, the fiscal control board is viewed in Puerto Rico as unaccountable to the people. And Puerto Rican officials are not inclined to tell workers they will be paid less than the minimum wage. With regard to the property and deed registrations, Puerto Ricans have long used informal ownership records.
The restriction relating to the electrical grid may just be a practical one: Congress has already appropriated a separate tranche of money specifically for the electrical grid, though it has yet to be allocated.
Sen. Chuck Schumer of New York, the Democratic leader, called the new restrictions “onerous and unprecedented” and said they “would add insult to injury for our fellow Americans in Puerto Rico reeling from multiple natural disasters.”
The White House announcement came four days after a 5.9-magnitude earthquake rocked an island reeling from a series of earthquakes this month and still struggling to recover from Hurricanes Irma and Maria in 2017. Parts of the island have lost power, and some Puerto Ricans have set up camp in public spaces instead of returning to their homes.
“While it is a welcome development that the administration has released its hold on these funds, this step is inexcusably overdue,” Velázquez said.
Puerto Rico’s government was already straining to spend federal money under earlier restrictions. The new conditions will make it much harder.
The administration’s disparate treatment of Puerto Rico is not new. In August, the Department of Housing and Urban Development announced that it would release billions of dollars in federal disaster mitigation funds in two funds: one for nine states on the mainland, and the other for territories like Puerto Rico and the U.S. Virgin Islands. The department also announced it would appoint a federal financial monitor to ensure that the money for Puerto Rico was managed properly.
“Recovery efforts in jurisdictions prepared to do their part should not be held back due to alleged corruption, fiscal irregularities and financial mismanagement occurring in Puerto Rico,” Ben Carson, the secretary of housing and urban development, said at the time.
Congressional Democrats are struck by how long the money has been delayed.
“As appropriators, we have fought for the release of the aid by questioning Secretary Carson, establishing a legal deadline for agency action, conducting an oversight hearing with HUD officials and the inspector general, and withholding money from the department in the most recent appropriations bill,” said Rep. David E. Price, D-N.C. “It should never have come to this.”
Since 2017, the housing department, the Federal Emergency Management Agency and other agencies have provided only a fraction of the $91 billion in aid Puerto Rico is estimated to have needed following Hurricanes Irma and Maria, leaving the island’s critical infrastructure and homes in limbo.
Trump has approved Puerto Rico’s request for an emergency declaration but has not approved a major disaster declaration, which could pave the way for additional federal funding.