Fiscal board warns gov't it will take action if pension laws that violate PROMESA are executed
The Financial Oversight and Management Board has warned the island government that it would take actions deemed necessary to stop any execution of three pension-related laws before the board can ascertain if they go against the commonwealth fiscal plan in violation of the Puerto Rico Oversight, Management and Economic Stability Act (PROMESA).
“Should you plan to implement these Acts or accept applications prior to our determinations that the Acts do not impair or defeat the purposes of PROMESA, or otherwise violate PROMESA, the Oversight Board further reserves the right to take such actions as it deems necessary, consistent with PROMESA sections 108(a), 204, and 207, including seeking remedies to prevent the implementation and enforcement of the Acts and for any wrongful implementation of them,” the oversight board’s executive director Natalie Jaresko said in a letter last week to Omar Marrero, head of the Fiscal Agency and Financial Advisory Authority (AAFAF by its Spanish initials). The letter was in response to a missive sent by Marrero on Sept. 1.
The three laws, signed in August, are Act 80, Act 81 and Act 82. Act 80 would create an incentivized early retirement program, Act 81 would create a “dignified” retirement plan for police officers, firemen, emergency service personnel and prison guards, while Act 82 would allow teachers to have their excess vacation time and sick leave be considered time worked for the purposes of determining their retirement package.
After enacting the three laws, the government failed to certify that the laws complied with the fiscal plan and provide an estimate of their impact.
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