Press Releases

Audit reveals irregularities in public works, services and internal controls at the Municipality of Guaynabo

San Juan, Puerto Rico (August 6, 2026) — The Comptroller of Puerto Rico, CPA and Attorney Carmen Vega Fournier, published today audit report OC‑27‑14, of the Municipality of Guaynabo, on the fiscal and administrative operations from January 1, 2021 to June 30, 2024. The report presents five findings and three special comments that reveal deficiencies in contracting processes, administration of public works, payments and internal oversight.

The report, with a qualified opinion, indicates that operations were carried out in accordance with the law in most respects, except for the situations noted in the findings.

The audit notes that the Municipality carried out works and improvements totaling $7,035,757 without holding a public auction, failing to comply with the requirements established by the Municipal Code and the Municipality's Auction Regulation. The auditors identified amendments that exceeded the legal limits without the proper approval of the Auction Board and without the preparation of change orders. The Comptroller recommended strengthening controls to ensure that auctions are held for all contract modifications that exceed the regulatory limits and to guarantee formal evaluation by the Auction Board.

The auditors noted improper payments of $458,709, due to retroactive amendments in works contracts and in professional services contracts, as well as the lack of detailed reports that would allow verification of whether the services were provided within the contract term. The report recommends recovering the funds paid in excess, establishing procedures to avoid retroactive payments and requiring reports that allow proper validation of the services invoiced.

A third finding in the audit documents that the Municipality assumed costs of $369,425 and failed to claim $27,006, after allowing the withdrawal of a bid following a public auction. This action was contrary to the regulation in effect and increased the cost of the work by awarding it to the second-highest bidder. The Comptroller recommended ensuring that the Auction Board strictly complies with the rules concerning the withdrawal of bids and the enforcement of bonds.

In addition, the Municipality paid $144,570 in excess due to incorrect calculations in billing items for construction work, particularly in administrative costs, taxes and insurance. The report recommends strengthening the review of the invoices submitted and ensuring that the calculations correspond to the percentages established in the contracts.

Another of the deficiencies noted was the granting of amendments to a construction contract without obtaining the corresponding bonds from the contractor, leaving an amount of $2,856,918 of the contracted value uncovered. The Comptroller recommended instructing the Office of Legal Affairs to ensure that, prior to any formalization, all necessary bonds and compliance documents are required.

Among the special comments, the report highlights the contracting of professional inspection and works supervision services with a corporation whose shareholder had had his engineering license suspended since 2015, which could constitute illegal practice. In addition, a delay was identified in the contracting and delivery of financial statement audits, which may affect the availability of information crucial to decision-making and compliance with federal requirements. Finally, a lack of effective oversight by the Municipal Legislature's Committee on Internal Audit, Ethics and Comptroller Affairs was determined, in that it did not evaluate relevant internal, external and federal monitoring audit reports.

The Comptroller noted that each of these observations includes specific recommendations addressed to the mayor, the director of Finance, the director of Public Works, the Office of Management and Budget and the Municipal Legislature, in order to correct the deficiencies observed and strengthen internal control. Audit report OC‑27‑14 is available at www.ocpr.gov.pr.