With Hurricane Season Looming, Billions in Disaster Recovery for Puerto Rico Remain Unspent


Dennis M. Rivera/AP Photo

In Puerto Rico, tens of thousands of people live under tarps instead of roofs, creating a serious risk of flooding in homes. 

More than a year after being authorized by Congress, $20 billion of recovery funds for Puerto Rico remain in bureaucratic limbo, giving rise to a blame game among Trump administration officials and officials on the island.

As of March 1, less than $14,000 of the $20 billion approved by Congress has been spent on post-disaster reconstruction activities in Puerto Rico, according to Department of Housing and Urban Development records. About $18.5 billion of that hurricane relief funding has not even reached the island yet, stuck somewhere between the department’s rigorous planning requirements and its drawing up of grant agreements.

During a spirited congressional hearing over the future of Puerto Rico’s power generation last week, lawmakers attempted to get to the bottom of the delay, making clear its implications for the island’s battered electrical grid.

“We got 53 days until the next hurricane season, and the people of Puerto Rico will not have a robust system to face the new hurricane season,” said Jenniffer González-Colón, Puerto Rico’s nonvoting Republican representative. “We can see [the recovery money], we can smell it, but we can’t touch. That’s the main situation on the island.”

When Hurricane Maria struck Puerto Rico in 2017, Congress responded by approving tens of billions in immediate disaster relief. In the following months, additional funding for the island was approved—$1.5 billion in February of 2018 and an $18.5 billion supplement two months later—to be distributed through the Department of Housing and Urban Development’s Community Development Block Grant-Disaster Recovery program.

About $10.2 billion of that second tranche of funding was designated to cover the island’s unmet needs that remained after initial assistance efforts, including nearly $2 billion for repairing Puerto Rico’s electrical grid, with the rest going toward efforts to mitigate storm damage in the future.

It’s that $2 billion in funding that González-Colón and other members of the House Natural Resources Committee tried to get clarity on during the hearing. They didn’t succeed.

As Department of Energy Assistant Secretary Bruce Walker told it last week, the blame for any sluggishness lies with HUD and the island’s publicly owned power company, Puerto Rico Electric Power Authority (PREPA). But when asked, PREPA executive director José Ortiz responded that HUD set excessive requirements and could have disbursed the money already.

“We’re going round and round. So, let it be noted this has to get done, because we’re facing another hurricane season,” said Florida Democratic Representative Darren Soto, seeming to lose his patience.

The reality, however, is that the $2 billion for Puerto Rico’s power grid is unlikely to be dispersed by HUD by the start of the Atlantic hurricane season on June 1. The same goes for the remaining billions in unspent aid destined for the island.

As is not the case with other disaster assistance programs, HUD lacks the authority to issue emergency funds without first publishing lengthy grant requirements for each new disaster. The result is a tangled web of red tape that has slowed the release of funds to recovering areas, as detailed in a recent report by the Government Accountability Office. The report’s authors attributed long wait times to short-staffing at the department along with the unduly laborious approval process for grantees.

After waiting months for guidance, states and localities seeking aid must then submit a mountain of documentation to be approved by HUD. Once approved, a grant agreement is drafted, finalized, and signed.

In the case of the initial $1.5 billion for Puerto Rico, which is to be spent on housing reconstruction and economic development, an agreement was signed only in September—a full year after Hurricane Maria hit the island. And despite congressional approval of $10.2 billion for the island last April, it wasn’t until last month that HUD gave the green light on its action plan for some of that funding. An actual agreement for the money has yet to be inked.

HUD says it’s currently working with the Energy Department, the Treasury Department, and the Federal Emergency Management Agency to develop guidelines for the $2 billion in electrical grid funds, though it’s unable to say when they will actually be released.

Last week’s hearing wasn’t the first time members of Congress voiced concerns over HUD’s handling of federal aid. In March, one day after the GAO report was published, a subcommittee of the House Financial Services Committee questioned HUD officials over delays in administering funds for Puerto Rico and other storm-struck areas. Much of their focus was on the White House’s role in the process.

President Trump has repeatedly shot down requests for more money for Puerto Rico, publicly exaggerating the amount of aid received by the island and tweeting that its leaders are “grossly incompetent, spend the money foolishly or corruptly, & only take from USA.” In February, he reportedly asked top advisers how to restrict future funding, according to The Washington Post. During the March hearing, lawmakers were informed that HUD’s inspector general intended to review potential interference by the White House in funding for Puerto Rico.

Compounding the president’s hostility, HUD itself has put new scrutiny on money going toward Puerto Rico. Along with its recent approval of the island’s plan to use some of that $10.2 billion in relief funding, HUD included a string of new financial controls, citing “a history of fiscal malfeasance on the island” as reason.

Puerto Rico has been plagued by a slow recovery after Hurricane Maria. Power outages across the island lasting as long as 24 hours remain a weekly occurrence. Tens of thousands of people live under tarps instead of roofs, creating a serious risk of flooding in homes. If a storm were to hit Puerto Rico today, even a minor one, there would be much suffering.

“We’re nearing the two-year mark of the deadliest hurricane in modern U.S. history, and we still don’t have a clear idea of how we’re going to rebuild Puerto Rico and its power grid,” says Federico A. de Jesús, a senior adviser for advocacy group Power 4 Puerto Rico Coalition, who attended last week’s hearing.

“What this administration needs to realize is that for many Puerto Ricans awaiting aid, Hurricane Maria never ended. And now, another hurricane season is coming.”

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