The Comptroller of Puerto Rico issued a qualified opinion on the fiscal operations of the Municipality of Coamo. A qualified opinion is issued when noncompliance, individually or in the aggregate, is significant but not pervasive.
The Report reveals that the Municipality, contrary to a usufruct agreement with the National Parks Company formalized in 2008, ceded the facilities of the Coamo Velodrome to a nonprofit corporation devoted to the sport of soccer. The agreement to maintain and manage the Velodrome for 30 years establishes that the Municipality may not transfer, cede, or sublease said facilities.
In August 2018, the Municipality ceded the use of the Velodrome to the Corporation; 10 months later, the Legislature authorized leasing the facility for $1 and in 2019 the Municipality formalized the lease agreement through June 30, 2020.
The one-finding audit notes that the Corporation, with the Municipality's consent and contrary to the usufruct agreement with National Parks, subleased four areas of the Velodrome to three entities and two citizens to operate the cafeteria, the gym, give karate classes, and hold activities, among others.
In addition, contrary to the contractual clauses, the Corporation provided a public liability policy below the required coverage, made changes to the Velodrome without prior authorization, and sold alcoholic beverages in the Club House.
On October 20, 2020, the Comptroller made a referral to the Secretary of the Treasury, because the Corporation was carrying out commercial activities at the Velodrome facilities without complying with the tax laws. As of the date of the Report, the situation is pending investigation.
This second and final report on Coamo covers the period from January 1, 2016 to December 31, 2019.
See Audit Report M-22-01.
To see other published reports, visit our Audit Reports section.
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