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The Office of the Comptroller of Puerto Rico issued a qualified opinion on the fiscal operations of the Municipality of Vieques. A qualified opinion is issued when the instances of noncompliance, individually or in the aggregate, are significant but not pervasive.

The Report reveals that, contrary to the laws and regulations in effect, eight agreements were formalized for the payment of construction excise taxes for $22,714, without the mayor's signature. In addition, the then Finance director made discounts in two agreements without the authorization of the Municipal Legislature, and the taxpayers' debt for those agreements was not recorded in the Ingresys module of the Integrated System of Advanced Municipalities (SIMA).

The audit of eight findings points out that the Municipality had not evaluated the accounts receivable totaling more than $100 thousand, overdue by five years. This situation does not allow Vieques to have an updated and reliable information system on its finances.

The auditors identified instances of noncompliance with the process of transferring appropriations between budget items. For example, the mayor did not submit to the Municipal Legislature the proper ordinances for the approval of 10 executive orders that authorized appropriation transfers of almost $1 million. These transfers had the effect of reducing the payment of personal services. In addition, the mayor approved 29 executive orders to make transfers for $2.6 million without the Finance director issuing the required surplus certifications. A similar situation had been commented on in Audit Report M-16-10 of 2015.

From 2016 to 2018, the Municipality did not prepare 19 bank reconciliations of the checking account or the monthly cash flow reports. These situations foster the commission of errors and irregularities with public funds.

The Report uncovers that Vieques disposed of 15 municipal vehicles, although it lacked the certification that they could not be sold. In addition, the Municipality did not notify the Office of the Comptroller of irregularities in the handling of public funds and property, among others, the theft of 433 units of property with a value of $120,552. Nor did the Municipality conduct administrative investigations into 21 units of property and it had not submitted to the Office of the Comptroller the Annual Certification of Notification of Losses or Irregularities for the years 2017 to 2018.

Vieques does not have a public document retention plan and the archive does not have storage shelving. In addition, the archive has no fire alarm system, the boxes are stacked one on top of another, several wet, broken, with mold, and the fire extinguisher expired. A similar situation had been commented on in Audit Report M-16-10 of 2015.

Contrary to the applicable laws and regulations, the Municipality had not updated the Regulation of the Bidding Board, nor that of Purchases and Supplies, to include provisions established in Act 81-1991 on Autonomous Municipalities and in the Regulation for Municipal Administration of 2016. Nor had the Municipality of Vieques complied with the submission and certification of the monthly reports of the Position Registry to the Office of the Comptroller. The latest, from 2014 to 2016, were submitted with delays of up to 18 months and without being certified by the mayor or the liaison officer.

The audit comments that the Municipality has seven civil lawsuits for $33.6 million pending resolution by the courts; one of the lawsuits, for unjustified dismissal, amounts to $31.5 million. In addition, the Municipality had not recovered $19,571 corresponding to Audit Report M-16-10 of 2015.

The Report recommends that the director of the Office of Management and Budget ensure that the Municipality complies with the Corrective Action Plan established by the Office of the Comptroller.

The Vieques report covers the period from January 1, 2014 to June 30, 2018.

See Audit Report M-20-23.

To see other published reports, visit our Audit Reports section.