Exclusive: Puerto Rico open for tourists despite ‘mixed-bag’ recovery – governor

FILE PHOTO: Governor of Puerto Rico Ricardo Rossello delivers remarks during a commemorative event organized by the local government a year after Hurricane Maria devastated Puerto Rico, in San Juan, Puerto Rico September 20, 2018. REUTERS/Carlos Barria

By Jessica Resnick-Ault and Nick Brown

NEW YORK (Reuters) – Puerto Rico Governor Ricardo Rossello flew to New York this week on a mission: persuade potential tourists that the hurricane-ravaged island was ready for their return.

But Puerto Rico’s recovery from last year’s Hurricane Maria has been a “mixed bag,” Rossello told Reuters on Thursday, acknowledging that the bankrupt U.S. territory, while improving, is far from out of the woods.

Puerto Rico has received only a small fraction of the federal funding it needs to get back on its feet, Rossello said in a 75-minute interview, and getting access to the rest could take more than a decade.

His administration estimates that fixing Puerto Rico fully will require $139 billion, but the federal government has earmarked only about $60 billion to $65 billion for the recovery, he said. Of that, only about $3 billion to $4 billion has actually flowed into the island’s coffers. Obtaining the remainder could take 10 to 11 years, he said, adding that his team is lobbying the U.S. Congress for more money.

Compounding the problem is Puerto Rico’s bankruptcy in U.S. federal court, where it is trying to restructure $120 billion of debt and pension obligations. There are also ongoing spending disputes between the government and a federally appointed fiscal oversight board.

In the year since Hurricane Maria, Rossello has at times been diplomatic regarding the federal government’s response, while at other times – especially lately – adopting a more critical take. He has also been criticized for sticking with an estimated death toll of 64 early-on, when strong evidence suggested it could be higher. A government-commissioned study by researchers at George Washington University eventually pegged the toll at around 3,000.

When asked whether his administration’s messaging strategies have been tied to an effort to maintain good relations with President Donald Trump, Rossello said a “critical part” of the island’s recovery “is making sure the federal government responds to our petitions.”

“So yes, I have opted for a path that involves dialogue, that involves collaboration,” Rossello said, adding that he has not been afraid to be critical.

If Trump does not sign the island’s request to extend the federal government’s 100 percent coverage of repair costs, “I’ll be the first one to fight it,” Rossello said, “and I’ll be the first to point out that action, or lack of action, is one of the main obstacles to our recovery.”

Rossello said Puerto Rico still has as many as 60,000 homes with temporary tarp roofs. It also has hundreds of thousands of informally constructed homes with many owners lacking title to their property.

Rebuilding will require the current ranks of about 45,000 construction workers to grow to 130,000, according to Rossello, who recently signed an executive order increasing the minimum hourly construction wage to $15 despite opposition from the oversight board and the private sector.

POWER SHIFT

The island’s government is still considering initiatives that could make the island’s troubled electricity grid more resilient, Rossello said. Ultimately, the island hopes to generate 40 percent of its electricity from renewables and steer away from fossil fuels. The shift would require a new regulatory policy, approval by the bondholders, and, potentially, investment from outside companies or organizations.

“We have received 10 to 12 unsolicited proposals for generation,” he said, while acknowledging the government has yet to find a private operator for the power utility’s transmission and distribution operations.

But changes at the electric agency known as PREPA, which Rossello called one of the most troubled organizations in modern history, will be gradual. The governor said he is working with a search firm to identify outside board members for the utility, after nearly the entire board quit in an uproar over appointment of a new CEO.

Limited electricity was a major problem for the island’s small business sector, according to a Federal Reserve Bank of New York report on Thursday. A survey of more than 400 businesses with fewer than 500 employees found 77 percent suffered losses as a result of hurricanes Irma and Maria.

ISLAND BECKONS TOURISTS

Meanwhile, Rossello is trying not only to restore tourism, but to expand it in such a way that it incorporates hundreds of square miles of seaside and mountain communities that are largely unvisited. Puerto Rico’s tourism is small compared with other Caribbean locales and tends to be centered in San Juan.

The island’s visitor lodgings hit a 2017 high of 204,025 in July, but fell to just under 30,000 in October following the hurricanes, according to Puerto Rico Tourism Company data.

Convincing tourists to leave the capital, though, will require easier travel. “Puerto Rico should be a multi-port destination,” he said, discussing plans to beef up airport capacity in the south and west of the island.

He emphasized the possibility of capitalizing on Puerto Rico’s near-constant spate of community festivals. “We have flower festivals, orange festivals, plantain festivals, coffee festivals, music festivals.”

Rossello pointed to so-called chinchorreos as a possible draw, events in which Puerto Rican foodies move from one inexpensive eatery to the next.

“A bar crawl for food – that’s the best way to put it,” the governor said, “and the island is small, so you start in one place and you’re on a beachfront, and 15 minutes later you’re in the mountains.”

(Reporting by Jessica Resnick-Ault and Nick Brown in New York, Karen Pierog in Chicago and Luis Valentin Ortiz in San Juan; Editing by Daniel Bases and Matthew Lewis)

Puerto Rico governor knocks U.S. Army Corps response to restoring power after hurricane

Cars drive under a partially collapsed utility pole, after the island was hit by Hurricane Maria in September, in Naguabo, Puerto Rico

By Nick Brown and Jessica Resnick-Ault

NEW YORK (Reuters) – Puerto Rico Governor Ricardo Rossello said the U.S. Army Corps of Engineers lacked urgency in restoring power to the storm-hit island, and that it was pushing the clean-up effort down the road.

The Army Corp was tasked as the leading federal agency to oversee power restoration in Puerto Rico about a week after the U.S. territory was devastated by Hurricane Maria.

Speaking to Reuters on a trip to New York, where he plans to meet Governor Andrew Cuomo, Rossello deflected to the Army Corps some of the criticism his administration has faced since Maria made landfall on Sept. 20.

Rossello and the island’s power authority, PREPA, were criticized for initially declining to seek so-called mutual aid from other U.S. public power utilities after the storm knocked out electricity to all of Puerto Rico’s 3.4 million residents.

That decision has become a focal point because it partly spurred PREPA to sign a no-bid contract with private firm Whitefish Energy Holdings – a deal Rossello canceled on Sunday after an uproar over its provisions.

Rossello has since sought mutual aid from utilities in New York and Florida.

But the initial decision to forgo it, he said on Thursday, was due in part to an understanding with the Army Corps that it could help restore power to Puerto Rico within 45 days, and would foot the bill at a time when the island’s bankrupt government could not afford to shell out much cash.

Six weeks after the storm, only about 30 percent of the island’s grid has been restored.

“We are very unsatisfied with the urgency the Corps” has shown, Rossello said. “Everything that has been done right now has been done by PREPA or the subcontractors PREPA has had.”

Jeff Hawk, a spokesman for the Army Corps, said in an emailed statement that “contracts usually take days to a couple of weeks, so we are moving quickly.”

Rossello also said he had some concerns about new parameters laid out on Tuesday by the federal board managing Puerto Rico’s finances, which would require his administration to submit a revised draft of a fiscal turnaround plan for the island by Dec. 22.

“We are in the process of answering to the board some of our concerns with the timelines,” Rossello said, adding that some of the parameters “are appropriate, and some are not, given the lack of information and the level of devastation in Puerto Rico.”

Puerto Rico filed the largest government bankruptcy in U.S. history this year to restructure $72 billion in debt.

Rossello said the revised plan would be centered around a strategy of reducing the size of government, boosting private sector partnerships, and reforming education and healthcare systems.

 

(Reporting by Nick Brown; Editing by Chizu Nomiyama and Susan Thomas)

 

Travelers swamp Puerto Rico’s main airport; dam on verge of collapse

An aerial view shows the damage to the Guajataca dam.

By Dave Graham and Robin Respaut

SAN JUAN, Puerto Rico (Reuters) – Hundreds of stranded travelers filled the sweltering halls of San Juan International Airport on Monday anxious to know when they could leave and reconnect with families after Hurricane Maria devastated power and communications across the island.

Fearful of checking out of hotels in case they could not get on the few flights available, worried passengers waited in long lines at Puerto Rico’s main airport, struggling to get through to loved ones and airlines alike.

“Everything is hearsay at the moment because there is no communication,” said 31-year-old Rene Kessler, a medical student from Baltimore, Maryland, preparing to spend the night in the airport ahead of what he hoped would be a flight back to the United States.

Puerto Rican officials have confirmed at least 10 storm-related fatalities on the island, and the hurricane was blamed for at least 19 other deaths across the Caribbean, the bulk of them on the devastated island nation of Dominica.

A microcosm of the battered island, the San Juan airport is a top priority in efforts by Puerto Rico’s cash-strapped government to repair the vast damage caused by Maria. Experts say the work will take months and likely run into tens of billions of dollars.

Closed for days following the storm, the airport is a major test of Puerto Rico’s ability to transport people and supplies and overcome the communications vacuum that has plagued the island since the storm.

María has also turned Puerto Rico, a haven for Caribbean islanders left homeless by Hurricane Irma earlier this month, into a disaster zone with virtually no power that many are now desperate to escape.

A dam on the island has weakened by heavy rains from Hurricane Maria was in danger of failing, posing a flood threat to thousands of homes downstream.

Some 70,000 people who inhabit a river valley below the Guajataca Dam in the northwestern corner of the island have been under evacuation since Friday after authorities warned the structure was in danger of imminent collapse.

The fear of a potentially catastrophic dam break added to the extreme difficulties facing disaster relief authorities in the aftermath of Maria, which has claimed at least 29 lives across the Caribbean, according to officials and media reports.

Puerto Rico Governor Ricardo Rossello urged residents of the area to evacuate after surveying damage to the dam over the weekend, telling reporters that a fissure in the structure “has become a significant rupture.”

The National Weather Service in San Juan, the island’s capital, on Monday continued a flood warning for western Puerto Rico.

Maria, the second major hurricane to savage the Caribbean this month and the most powerful to strike Puerto Rico in nearly a century, carved a path of destruction through the island after plowing ashore early on Wednesday.

 

‘WE LOST EVERYTHING’

“We lost our house, it was completely flooded,” said resident Carmen Gloria Lamb, a resident near the rain-swollen Guajataca. “We lost everything. Cars, clothes, everything.”

Severe flooding, structural damage to homes and the loss of all electricity, except from backup generators, were three of the most pressing problems facing Puerto Ricans, New York Governor Andrew Cuomo said during a tour of the island. New York is home to many of Puerto Rican descent.

“It’s a terrible immediate situation that requires assistance from the federal government, not just financial assistance,” he said on CNN on Saturday.

Even the island’s medical facilities have been left in precarious shape, with many hospitals flooded, strewn with rubble and running critically low on diesel fuel needed to keep generators operating. Evacuation to the U.S. mainland is the only option for some patients.

The storm has caused an estimated $45 billion of damage and lost economic activity across the Caribbean, with at least $30 billion of that in Puerto Rico, said Chuck Watson, a disaster modeler at Enki Research in Savannah, Georgia.

 

(Writing by Alex Dobuzinskis; Editing by Sandra Maler and Jeffrey Benkoe)