Press Releases

Comptroller reveals overpayments of more than $1.5 million in contracts for the purchase of a building, debris removal and equipment acquisition in Barceloneta

The Office of the Comptroller of Puerto Rico (OCPR) issued a qualified opinion on the fiscal operations of the Municipality of Barceloneta. A qualified opinion is issued when the noncompliances, individually or together, are significant but not pervasive.

The Report reveals that the Municipality overpaid $1.4 million for the purchase of a $13.5 million property under a lease agreement with an option to purchase a lot. This contract was amended to extend the construction time on the lot for the administrative facilities of Head Start and Early Head Start; however, the amount was not amended.

In fact, the appraisal valuation reports prepared by a private appraiser of this property were not reviewed by a reviewing appraiser, nor did the Municipality submit them for the approval of the Municipal Revenue Collection Center as required by the current regulations.

The Municipality of Barceloneta also overpaid $148,485 for the purchase of air conditioning consoles under an original contract of $50,000. In addition, the contractor billed for purchases made up to eight months after the contract expired on June 30, 2022.

Another payment without a contract amendment was made on February 24, 2021, for debris removal in excess of what was established in the contract. The Municipality paid $29,060 for the excess removal of cubic yards of debris.

The audit, with five findings, notes that the Municipality paid $501,882 for professional services to an engineer for the design of plans and construction permit procedures for facilities on the grounds of the Dr. Francisco Susoni School that were never built. For this contracting, the Municipality requested a single proposal instead of conducting a competition among providers as required by the Code of Federal Regulations 2.

The audit recommends that the Office of the Inspector General of the Federal Department of Health consider these situations so that it takes the appropriate measures.

The auditors identified that the Municipality had not collected $146,162 from a corporation for the extraction of 116,930 cubic meters of material extracted from the Municipal Borrow Pit. As a result of this audit, the Municipality recovered $46,824, with an outstanding balance of $99,338. This situation undermines the credibility of the Municipality's oversight processes.

Contrary to the current law and regulations, the Municipality of Barceloneta paid $203,649 to a retiree who had resigned from her position as executive director as of June 30, 2022 with a monthly salary of $8,112. The mayor reactivated her in her position as executive director, in which she earned $269,031, from July 15, 2022 to December 31, 2023. As a retiree, she should have received $65,382, half of the basic salary of the pay scale.

As a result of this audit, the mayor of Barceloneta submitted an inquiry to the Retirement Board, which decided to suspend the executive director's pension. In addition, the Retirement Board indicated that the retiree had to return the pension collected.

The Report publishes other deficiencies such as the improper payment of $1,616 to an employee for the settlement of leaves and employer contribution that did not correspond to her. In addition, the acquisition of a $10,995 air condenser was authorized without requesting quotations from at least three providers in the market.

The Municipality's budget was $27.5 million in 2020, $26.1 million in 2021, $26.5 million in 2022, $30.9 million in 2023 and $32.1 million in 2024.

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

This second and final report on Barceloneta covers the period from July 1, 2019 to December 31, 2023
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The Audit Report OC-25-83 can be obtained on our website: www.ocpr.gov.pr.