Puerto Rico's treatment is a major shame on the US

When Congress passed a $36.5 billion disaster relief bill to bolster rebuilding efforts in several wildfire and hurricane-damaged areas in October, it shortchanged Puerto Rico, giving it a $4.9 billion loan instead of the grant that other areas received. Now, it appears the debt- and hurricane-ravaged island won’t even get that money.

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Federal Emergency Management Agency and the Treasury Department informed the Puerto Rican government on January 9 that they will not disburse the loan through the Community Disaster Loans Program, after finding that Puerto Rico had a cash balance on December 29 of last year of $1.7 billion for ongoing operations. The letter also cited $6.875 billion scattered in various local government accounts.

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“Funds will be provided through the CDL Program when the Commonwealth’s central cash balance decreases to a certain level,” wrote FEMA official Alex Amparo and Deputy Assistant Treasury Secretary Gary Grippo. They didn’t specify that level but added that municipalities could also apply for loans.

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The Puerto Rican government has asserted that its state-run power and sewer companies will exhaust funding this month. Nearly half of the island’s citizens remain without power. With FEMA and the Treasury refusing to release government-approved loans, it’ll be difficult for the Puerto Rican government to float money to the power and sewer companies.

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Puerto Rican officials have said Medicaid funding will run out early this year without the increased funding. Though this would seem to fit the definition of ongoing operations covered in the CDL program, FEMA and the Treasury did not reference Medicaid in their letter.

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Puerto Rico also took a hit from the Tax Cuts and Jobs Act, the Republican overhaul of the tax code, which treats manufacturing operations on the island like they’re in a foreign country, subject to a large export tax.

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That the island is being treated like a welfare recipient found to have too much money in its bank account takes it to another level. Among U.S. territories suffering from catastrophe, only Puerto Rico is being means-tested.

  The Intercept