The Office of the Comptroller of Puerto Rico issues a partially adverse opinion on the fiscal operations of the Municipality of Guánica related to permanent works and improvements, and the leasing of some municipal facilities.
The Report reveals that the Municipality split the remodeling of the Dr. Juan Santiago Diagnostic and Treatment Center (CDT) into four contracts to three contractors for $730,000. This amount rose to $916,007 following one change order and seven addenda. The individual costs did not exceed the limit established by law of $200,000, for which reason the Municipality did not hold a public bid. The Municipality also did not require the contractors to provide the bonds and policies required before formalizing the contracts. These situations prevent free competition and leave the Municipality without guarantees in the event that the contractors did not finish the work.
The four-finding audit notes that four projects were built without the prior permits from the Permit Management Office as provided by Act 161-2009. The CDT, for example, obtained its construction permit six months after the first contract for its remodeling was awarded. The Monument to the Soldiers and the Paseo de los Guaniqueños also did not obtain the endorsement of the Institute of Puerto Rican Culture required because of its location in the Plaza de Recreo.
Our auditors identified that the Municipality had not collected $47,118 in construction excise taxes nor withheld that amount from the payments made to the contractors whose contracts amounted to $1.1 million. As a consequence, Guánica failed to receive that income to address operational needs.
The Report publishes that the Finance directors did not obligate the budgetary appropriations of nearly $1 million for the payment of the contracts. In addition, the Municipality failed to collect $68,665 from the leasing of the community centers and the Club Puertorriqueño de Ensenada-Guánica by ceding them free of charge.
As of June 30, 2015, the Municipality had 11 civil lawsuits for $2.8 million pending resolution in the Courts and 48 cases filed by employees before the Public Service Appeals Commission. In addition, it had not recovered some $76,000 that we recommended in prior audits of 2010 and 2014.
The Report covers the period from March 1, 2013 to June 30, 2015.
See Audit Report M-17-36.
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