Home > Press Releases > Governor of Puerto Rico Continues Reforms and Signs New Law to Make Government More Efficient and Reduce Costs

(December 19, 2017 – San Juan, Puerto Rico) Today, the Governor of Puerto Rico Ricardo Rosselló advanced his reform-minded vision and commitment to transparency by signing a bill to create the New Government of Puerto Rico Act, which seeks to establish more efficient government structures and achieve significant savings.

The legislation—which becomes Act 122 of 2017—establishes a uniform process for the reorganization of the new government. This includes consolidation, outsourcing, and reorganization of government agencies and corporations, as well as their programs.

“With the purpose of making a more agile government, improving services to citizens, protecting our public employees, and being fiscally responsible, today I sign this bill into law. As we established in the Plan for Puerto Rico, with this measure we give way to the implementation of a new, more efficient government,” said the Governor.

The Chief Executive explained that this measure seeks a draw down from 118 agencies to 35 more efficient ones, to comply with the provisions of the Plan for Puerto Rico, the Fiscal Plan, and thus achieve cost reduction to meet the inherited deficit of $ 7.6 billion.

According to the law, the agencies that cannot be considered for consolidation are the nine constitutional agencies: State, Justice, Treasury, Education, Labor, Transportation and Public Works, Economic Development and Commerce, Health, and Agriculture.

For the purpose of continuing the transparency and effectiveness of the Government, the statute will not apply to: The Office of the Special Independent Prosecutor, the Office of Government Ethics, the State Elections Commission, the Office of the Comptroller, the Office of the Electoral Comptroller, and the University of Puerto Rico.

Additionally, the law will not apply to public corporations that already have an approved fiscal plan, such as the Electric Power Authority, the Aqueduct and Sewer Authority, and the Highways and Transportation Authority, among others.

The statute requires that the submitted plans are efficient and cost-saving, do not entail the dismissal of public employees, or lead to the loss of federal funds.

Once the reorganization plan has been submitted by the Executive, it will be considered by the Legislative Assembly. Fifteen days after it is approved, the governor will present an additional bill to repeal those laws affected by the plan, and establish the new public policy of the agency.

An outstanding example of successful agency consolidation is the Department of Public Safety (DSP, for its Spanish acronym), which consolidated seven public agencies and achieved savings of $28 million in its first year without dismissing public employees.