Uneven Recovery for Puerto Rico

Puerto Rico is posting some good news. Home prices increased 14% year over year amid signs of strong demand. Unemployment has fallen to 7.7% — double the average in the United States, but half what it was a year ago. Tourism is up by 34% over last year’s numbers. Even the territory’s debt is falling — last year it was 91.7% of the GDP, compared with 94.2% in 2013.

But while tourist areas are springing back, with hotels and restaurants in good condition for visitors, other parts of the island are still struggling. The American Society of Civil Engineers, Puerto Rico Section, points out that “Puerto Rico is a nonincorporated territory. This means federal funding is determined by a different formula than the states.” They made this point in a recent report giving Puerto Rico D and F grades in all areas of infrastructure. “Rural and remote communities face significant challenges in terms of funding system improvements and securing recovery funds from the U.S. federal government. Many of these entities are not legally incorporated and some lack internet access – both necessities in order to qualify for and apply for recovery funding.”

The mayor of Yabucoa says his municipality is “in the same situation as we were in the days after the hurricane.”

A recent report on water quality claims that “wastewater regularly floods the streets” in Puerto Rico’s low-income neighborhoods. The same report says that the number of homes in Puerto Rico lacking indoor plumbing has increased. Affordable housing is in short supply, and thousands of homes are still patched with blue tarps. Basic needs are still not met in less prosperous areas.

Sometimes solutions are theoretically available, but are not options for people in more remote areas. Irrigation systems, for example, don’t work well in the mountains, and are too expensive for small coffee farmers in central Puerto Rico who are still struggling to rebuild from the destruction caused by Hurricane Maria.

And the economy has not rebounded as some predicted it would. There were predictions that the work toward recovery would bring money into Puerto Rico, but that has not panned out.

The Center for a New Economy is tracking federal government contracts awarded to clean up and rebuild. At this point, 90% of the contracts –$4.81 billion — have gone to firms based in a state. Contracts awarded to companies based in Puerto Rico total just over one half a billion dollars.

At a recent CNE conference, Former HUD Secretary Shaun Donovan warned that much of the Federal Emergency Management Agency’s (FEMA’s) rebuilding efforts center on “market value.” Rebuilding areas that can bring in tourist dollars is important to the Island’s economy, but Donovan also said, “If the poor and vulnerable aren’t recovering, then you’re not recovering well.”

Leave a Reply

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.