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Puerto Rico Senate hearing flags legal, financial and transparency risks in Luma/UMA contract
Summary
Senate committee witnesses and senators raised concerns that the Luma/UMA management contract could put public funds and FEMA reimbursements at risk, set weak financial guarantees, allow contract termination after declared disasters, and lack transparency and adequate conflict‑of‑interest safeguards.
A Puerto Rico Senate committee hearing reviewed the Luma/UMA management contract and aired multiple concerns about legal exposure, financial protections and transparency.
Senate speakers and witnesses argued the contract treats customer tariffs as public funds, raising questions about oversight and ethics reporting. Speaker 1 stated, “las tarifas si son fondos públicos,” arguing the contract and practice mean rates collected on behalf of the authority remain public and should be treated as such.
The committee heard that the contract’s text and related exhibits warrant detailed legal scrutiny. Speaker 3 pointed to contract section 5.3B, saying it recognizes that transmission and distribution funds collected by Luma on behalf of the authority ‘‘permanecerán la propiedad de el dueño, que el dueño es la autoridad,’’ which undercuts claims that tariffs are not public funds and supports calls for formal review.
Witnesses also flagged a potential threat to FEMA reimbursements. Speaker 3 explained that the Stafford Act limits FEMA funds to…
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