The Office of the Comptroller of Puerto Rico issued a qualified opinion on the fiscal operations of the Authority for the Redevelopment of the Lands and Facilities of the Roosevelt Roads Naval Station (Authority). A qualified opinion is issued when the instances of noncompliance, individually or in the aggregate, are significant but not pervasive.
The Report reveals that the Authority did not require, on time, work schedules and progress reports in lease contracts formalized from 2015 to 2018 for the operation of the shipyard and a dry dock, for the manufacture of metal and plastic parts, and for the development of a rental residential resort community. Compliance with these contractual requirements occurred up to four years late with the schedules and up to two years late with the progress reports. These situations do not allow control of the status of the works nor supervision of compliance with the contracts.
In addition, the Authority does not maintain a technical file per project, and the Board did not provide for examination evidence that the executive director has presented three of the five work plans, nor six budgets. In this way, the Authority could not exercise adequate control of the file, and it also hinders the oversight work of the Comptroller's auditors.
The two-finding audit points out that the Authority has not appointed a document administrator, has not complied with preparing an inventory of the inactive documents, nor does it have an updated document retention plan.
The Report comments that the facilities of the Naval Station are deteriorated and are not being used. After nine years had elapsed since the transfer of three parcels to the Authority, and making investments of $30,792,029 and having a debt of $24,498,168, it only had 14 projects with 17 tenants occupying a third of the Authority's acres of land. (See photos in Exhibit 2 of the Report)
On the other hand, the Authority had not contracted a master developer, after an evaluation of eight proponents in 2014, and incurring expenses in this regard of $459,455. In addition, after formalizing a contract with the United States Department of Agriculture, to grant a loan for $4,936,000 and receive a grant of $666,200 for the purpose of carrying out improvements to the drinking water system, this is in the phase of beginning the bidding process. As of June 2021, only 392 jobs had been created, according to the reports of the Department of Economic Development and Commerce.
The audit recommends that the Governor and the Legislative Assembly take the corresponding measures with respect to the delay in the redevelopment of the lands and facilities of the Naval Station indicated in the Special Comment. This audit covers the period from July 1, 2016 to September 15, 2021.
See Audit Report CP-23-02.
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