Puerto Rico board asks Congress for backing in fight with governor

By Reuters Markets Reuters

WASHINGTON, Nov 7 (Reuters) - The federally appointed oversight board that manages Puerto Rico's finances asked Congress for support on Tuesday in its fight with the island's governor over who should take charge of halting efforts to restore electric power after Hurricane Maria.

Continue Reading Below

The storm knocked out Puerto Rico's power grid more than six weeks ago, and federal and territorial authorities have been slow to make progress on the massive project. As of Monday, 42 percent of the bankrupt island's electricity had been restored.

Power shortages affecting hospitals, schools and businesses have prompted as many as 100,000 Puerto Ricans to flee for the mainland - a level of migration that could further hurt the local economy, lawmakers on the House Natural Resources Committee were told during a hearing.

A month after the hurricane, the oversight board moved to appoint retired Air Force Colonel Noel Zamot as an emergency manager for the Puerto Rico Electric Power Authority (PREPA). But Puerto Rico Governor Ricardo Rossello has said the board overstepped its authority and is fighting the appointment in court.

Given the urgency of restoring the power, Natalie Jaresko, the board's executive director, asked lawmakers to clarify that the board has the power to appoint Zamot, review contracts and set a fiscal plan, suggesting that federal aid be made contingent on it.

"We would appreciate a legislative affirmative of those, and/or conditioning of appropriations on those powers as you see fit," Jaresko told lawmakers.

Continue Reading Below

She said the price tag for rebuilding the storm-battered island - home to 3.4 million Americans - was as high as $100 billion.

Lawmakers had planned to grill Ricardo Ramos, PREPA's executive director, at the hearing. But on Monday night, the utility said he was too busy to attend the hearing.

Rossello was slated to testify to the committee next week, said its Chairman Rob Bishop, a Republican.

The House committee has asked PREPA to explain the circumstances surrounding the awarding of a $300 million contract to Whitefish Energy Holdings, a small Montana company that had been hired to rebuild the island's power grid.

Bishop said documents submitted to the committee by PREPA late on Friday "raise other questions."

"We do not want another situation like Whitefish to happen again," Bishop said.

Zamot told lawmakers he was ready to name experts to help with the power restoration project as soon his appointment is confirmed.

The Federal Emergency Management Agency and U.S. Army Corps of Engineers are still determining how much it will cost to fix the power grid, Zamot added, saying he expected estimates in two weeks. (Reporting by Richard Cowan and Roberta Rampton; Editing by Susan Thomas and Tom Brown)