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Executive Order 2021-012 LUMA Contract Inspection

On January 12, 2021, Governor Pedro Rafael Pierluisi Urrutia signed Executive Order 2021-012 (“EO 2021-012” or the “Executive Order”) to order the creation of a steering committee to oversee the public-private partnership contract for the transmission and distribution of electric power granted to Luma Energy.

For your convenience, in this Alert, we will highlight the major Key Points.

1st SECTION A Steering Committee is created to oversee the execution of the public-private partnership contract between the Public-Private Partnerships Authority, Electric Power Authority, and LUMA.

2nd SECTION The Steering Committee will be chaired by the Secretary of State and will be composed, also, of the following public officials:

  1. The Executive Director of the Puerto Rico Financial Advisory Authority and Fiscal Agency ("AAFAF");

  2. the Executive Director of the Association for Assistance to Political Prisoners;

  3. the Executive Director of Electric Power Authority;

  4. the Executive Director of the Central Office for Recovery, Reconstruction and Resilience;

  5. Secretary of the Department of Labor and Human Resources; and

  6. the Secretary of the Department of Housing.

3rd SECTION Specifically, the Steering Committee will take steps to ensure that the following legal requirements and public policy elements are fully complied with:

  1. Ensure that the implementation and execution of the contract between the Public-Private Partnerships Authority, Electric Power Authority, and LUMA will not increase electricity tariffs, under current laws and regulations;

  2. shall ensure that Electric Power Authority personnel who choose to remain in the Government of Puerto Rico shall be assigned under the statutes, regulations, and administrative rules applicable thereto, including mobility plans, and that no regular Electric Power Authority employee shall be left without employment or lose benefits as a result of the contract between the Public-Private Partnerships Authority, Electric Power Authority and LUMA;

  3. Ensure that the necessary contributions to Electric Power Authority Employee Retirement System are made for all employees who transfer to LUMA and decide to continue contributing under Electric Power Authority Employee Retirement System;

  4. ensure that measures exist to avoid conflicts of interest on the part of any entity, public or private, in the awarding of contracts, or any other legal business, related to the reconstruction and strengthening of Puerto Rico's electrical network; and

  5. it will provide recommendations, suggestions, and comments to ensure that LUMA complies with clear and specific compliance and performance metrics, within specific time frames, according to the structure contemplated in the contract between the Public-Private Partnerships Authority, LUMA, and Electric Power Authority, as well as applicable laws and regulations.

4th SECTION

The President of the Steering Committee will be responsible for organizing the recommendations and reports that are approved.

REPORTING (6th SECTION)

The Committee shall be charged with preparing reports, which shall be submitted to the Governor's Office and the Secretary of the Interior every ninety (90) days.

Other EO 2021-012 Provisions:

  • 5th SECTION

  • REPEAL AND VALIDITY (7th SECTION)

  • SEPARABILITY (8th SECTION)

  • NO CREATION OF ENFORCEABLE RIGHTS (9th SECTION)

  • PUBLICATION (10th SECTION)

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