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Over the past five years, public entities have recovered only $267,380 following the irregularities detected by the Office of the Comptroller

The government has failed to recover more than $42.1 million that, according to the audit reports of theOffice of the Comptroller of Puerto Rico (OCPR), must be returned to the public coffers due to irregularities detected in government contracting over the past five years.

Of a total of $44.5 million identified in audits between January 2020 and December 2024, only $267,380 has been recovered, while another $2,100,668 is already considered uncollectible, according to data the OCPR shared with El Nuevo Día.

This minimal recovery rate exposes a picture of inaction and apparent impunity in the management of public funds, in the opinion of the comptroller, Yesmín Valdivieso.

“We do not have the power to compel any unit to recover the money,” said Valdivieso, arguing that carrying out the recovery is not in her hands. “We do continue to follow up on the requests for money recovery. In some cases, they recover it and, in other cases, (those in charge in the government units) play dumb. I have no other word to describe it,” she stressed.

From January 1, 2020 to December 31, 2024, the OCPR published 123 audit reports that revealed flaws in contracts related to construction, works, permanent improvements, and professional services corresponding to 86 government entities.

Of those, 50 reports contained specific recommendations to recover misused or improperly paid funds, for a total of $44,501,586. However, at the close of this past March, about 95% of that amount –some $42,133,538– had still not been returned to the treasury.

The OCPR explained that there are 11 cases in which the respective government entities have already determined not to pursue recovery efforts, among them the municipal governments of Hormigueros, Hatillo, Coamo, and Arecibo. In another example, a debt of $65,214 was declared uncollectible because the Municipality of Naguabo did not carry out the corresponding recovery efforts and it lapsed.

At the top of the list with pending recovery efforts is the Bureau for Emergency Management and Disaster Administration ($27,237,370), followed by the Office of Management and Budget ($2,870,023), the Infrastructure Financing Authority ($2,306,895), the Department of Correction and Rehabilitation ($1,709,431), the Medical Services Administration ($1,681,841), the Municipality of Barceloneta ($1,468,024), and the Telecommunications Bureau ($1,031,028).

The information –which covers only five years– comes at a time when the appropriations from the U.S. government are expected to be reduced from the current 46% to 43%, in the fiscal year 2025-2026 budget, as a consequence of the federal funding cuts driven by the administration of Donald Trump. In Puerto Rico, this offensive has mainly affected, so far, the Departments of Education and Health.

The most common findings that trigger recovery recommendations include the absence of clauses required by law in the contracts, payments made outside the contractual terms, and services rendered before or after the contract's effective period. These are errors that, according to the comptroller, recur far too frequently.

“In some cases, they recover it and, in other cases, they play dumb ”

Yesmín Valdivieso, Comptroller

“In our reports, in all the reports, there is always some problem with some contract,” noted Valdivieso, who criticized the repeated late registration of contracts at the OCPR by government entities. “We come down hard on the agencies so they register (contracts correctly), but the reality is that the contractor is as responsible as the agency for ensuring that this contract is registered,” she stressed.

10 cases under investigation

Valdivieso explained that the OCPR refers recovery cases mainly to the Department of Justice and to the Department of the Treasury, which has a unit for collecting debts owed to the government. Likewise, these reports are referred to the Joint Commission on Special Reports of the Comptroller in the Legislature, which is supposed to follow up on the recommendations. “It could be better,” the official replied when asked whether she considered the recovery efforts by those entities to be effective.

In this regard, Justice indicated that it receives the referrals from the OCPR, evaluates them and, if warranted, assigns the cases to its Division of Tax, Money Collection, and Eminent Domain.

In a written statement, the agency specified that, as of this week, that Division had 10 active cases under investigation. “As part of the process, once the investigations are completed, the Department of Justice will notify the corresponding agencies whether it will proceed with a claim or whether the case will be closed,” it indicated.

The statement, however, does not detail the age of those 10 cases, how many referrals it has received over the past five years, nor an estimated time frame for the conclusion of the inquiries.

Treasury did not respond to a request for information from El Nuevo Día.

Likewise, Senator Karen Román, chair of the Joint Commission on Special Reports of the Comptroller, was not available. Her spokesperson, Josian Vázquez, indicated that the New Progressive legislator was busy addressing matters related to the personal incident she had with an airline.

Incompetence and impunity

The prevailing inaction is seen as a symptom of a greater ill, according to Mario Negrón Portillo, retired professor and former director of the School of Public Administration of the University of Puerto Rico, who described the landscape as “incompetence, on one hand, and impunity on the other.”

“What you are bringing up describes what is happening with the public administration of Puerto Rico,” affirmed Negrón Portillo, in a separate interview. “On one hand, giving the benefit of the doubt, it may be that people make mistakes out of ignorance. And, on the other hand, you have the problem of impunity, where here decisions are made, things happen and, at the end of the day, it is as if nothing had happened.”

Negrón Portillo argued that the lack of diligence in recovery feeds the perception that “no matter what you do wrong, nothing is going to happen.” In that vein, he added that the agencies, overloaded or without trained personnel, choose not to invest efforts in recovering the money, because they understand they will not be asked to account for it.

He opined that, in the past, the OCPR reports generated a certain fear among some officials, particularly mayors, due to their possible electoral cost, but that is a thing of the past. “If there is no longer that fear, no longer that deference, that ‘I think something bad could happen to me,’ then nothing is going to happen, decisions keep being made, problems keep piling up,” he stated.

Urgent need for consequences

Both Valdivieso and Negrón Portillo agreed on the need for real consequences. The comptroller, although she maintained that, at times, the errors may be administrative and not in bad faith, insisted on the rigor required when handling public funds. “The rules of government contracting are very strict and there must be an effort,” she asserted.

“There must be consequences,” Negrón Portillo stressed, for his part. “This starts from the top, there must be a very clear directive from the Office of the Governor, demanding compliance and work from public officials and, in addition to demanding it, imposing a consequence,” he emphasized.

The shared responsibility between the government and the contractor is the focus of a recent OCPR campaign titled “Avoiding findings is in your hands”, with which they seek to raise awareness among government suppliers about the need to also monitor strict compliance with the regulations.

“We recommend that they make sure the contract complies with all the requirements of law, regulation, and interpretive case law to avoid irregularities,” Valdivieso expressed.

She emphasized that a contract must be in writing and signed by the parties, have prospective effect, and be duly registered at the OCPR before starting services. A common error, such as amending an already expired contract, invalidates that amendment, putting the payment to the contractor at risk, even if the contractor performed the work.

“You may have been paid, but that does not mean that we are not going to flag it or request that the money paid to you be recovered,” the comptroller warned. “Public contracting represents a significant proportion of the government budget. That is why contractors have the responsibility to make sure they comply with all the legal rules that apply in order to avoid a finding or a recovery recommendation,” she stated.