A Passing Scare in D.C.: Puerto Rico Fiscal Oversight Board Faces Questions, Not Consequences

Wednesday, July 16, 2025

Hearing: Puerto Rico’s Fiscal Recovery under PROMESA and the Road Ahead

Washington D.C.

At 9:45 a.m., there was a line forming in one of the corridors of the Longworth House Office Building of the U.S. House of Representatives. People were waiting to enter the Morris K. Udall hearing room to listen to testimonies on a topic that rarely echoes within the marble walls of Washington, D.C.’s neoclassical buildings. Several members of the Subcommittee on Insular and Indigenous Affairs, part of the House Natural Resources Committee, were preparing to evaluate the performance of the Fiscal Oversight Board that the U.S. government imposed on Puerto Rico in 2016.

The attendees waited for the hearing room doors to open, chatting excitedly, as if they were lining up for a nightclub. Among them were American high school students doing summer internships in congressional offices. Naturally, there were also lawyers from different firms, folders and styrofoam coffee cups in hand. Others looked like rookie congressional aides, badges hanging from their necks, sporting a fashion blend of dark navy corporate attire paired with white Converse sneakers.

The doors opened.

The hearing room was spacious, adorned with large, realistic portraits of what appeared to be politicians from the past. Floor-to-ceiling windows, silk curtains, and gold-colored chandeliers topped with statuettes of eagles with outstretched wings set the tone. I breathed in the air of imperial decorum and took a seat at the small table designated for the press. Only one journalist was there — José Delgado from El Nuevo Día. I remember a time when the Fiscal Board used to draw far more media attention. International press, specialized outlets, and U.S. media would send their correspondents to cover the Board’s sessions in Puerto Rico or New York. Protests would erupt outside. But nine years after its establishment, the Board seems to have become normalized.

In the last row of the auditorium sat the Junta’s executive director, Robert Mujica — Junta being the term commonly used in Puerto Rico to refer to the Fiscal Oversight Board — surrounded by men and women in blazers who chatted among themselves, while he remained silent, his chin resting on his clenched fists, eyes fixed on the floor in a distant gaze.

The hearing was set to begin in 15 minutes. Since its establishment in 2016, the Board has pushed neoliberal policies centered on budget cuts to balance the government’s finances. One of the conditions for the Board’s dissolution is that the Government of Puerto Rico must produce four consecutive balanced budgets. But in nine years, not even one has been achieved.

The Board also represents the Commonwealth in the debt restructuring process that the Government of Puerto Rico entered after declaring bankruptcy in 2017, under the jurisdiction of the U.S. District Court for Puerto Rico. One of its touted achievements is securing the repayment of 80% of the debt to bondholders — after all, that was one of the tasks assigned to it by the PROMESA Act.

And now that the debt restructuring process is in its final phase — only the Puerto Rico Electric Power Authority (PREPA) remains to be resolved — everyone is asking the same question: when should the Board leave?

But rather than planning its exit, the Board seems more interested in staying. Since its inception, it has built an entire class of intermediaries — advisors, lawyers, accountants — who earn luxury-level salaries. Some of them were present at the hearing, surrounding Mujica. He was to be the “main witness” in this hearing that mimics a courtroom format. Yet on the front bench, there were no judges — only members of Congress. They read prepared statements and questioned Mujica and two other “witnesses,” playing the role of prosecutors or “defenders of the people of Puerto Rico.” But they failed to mention any metrics or specific benchmarks to evaluate the Board’s performance in a meaningful, precise, or accountable way.

Nor did they commit to introducing any legislation related to PROMESA or the Board, nor did they set a date for a future congressional hearing to follow up. The hearing served more as a stage for each participant to present their best self — within their capacities — all claiming to speak on behalf of Puerto Rico, fully aware that in the end, their words would carry no real effect or consequence. In that auditorium, the entity with the most real power over Puerto Rico remained the Board, which for the past nine years has faced no obstacles in imposing austerity measures.

Still, Mujica, the Board’s executive director, was nervous. When I asked him — in English, “Are you nervous?” — he was standing facing the back of the room, getting ready to take his seat in the front row, designated for the “witnesses.” Before answering, he paused for a few seconds in silence, once again staring off into the distance. Then he turned to me and said, “Of course,” looking me in the eyes with a faint smile.

Shortly after, a screech rang out — like an emergency door opening. A red digital clock on the wall struck exactly 10 a.m. Then came the sound of the gavel, struck by the chairman of the Subcommittee, Republican Jeff Hurd of Colorado’s 3rd District. And just like that, the morning’s spectacle in Washington, D.C. began — with stopwatch precision, as is customary in this subworld.

From the Bodega to the Board: Robert Mujica’s ethnic card

On the bench, Hurd delivered the opening remarks. He said the subcommittee was exploring the next steps to resolve Puerto Rico’s debt crisis and working to ensure that measures are put in place to prevent the Puerto Rican government from facing financial risks in the future. But he offered no details about what those steps might be, or what those preventive measures should include.

Next to speak was Rep. Teresa Leger Fernández, a Democrat from New Mexico. She took the opportunity to summarize the PROMESA law, reiterate the amount of debt the Government of Puerto Rico has had to repay, and acknowledge that the island continues to face economic hardship. She then called on “all parties” — without specifying who those parties were — to come together to resolve PREPA’s debt. As if it were simply a matter of teamwork, when it’s a battle between factions armed with law firms, locked in a years-long fight over who gets paid more — or who pays less.

Just as the Board itself has become normalized, its key figures have also faded into the background of Puerto Rico’s media landscape. Its first chair, José Carrión III, gained notoriety during his tenure — partly due to his privileged background and his cold, unapologetic demeanor. With his slicked-back, dark hair glistening with gel, he was a recognizable face.

Today, I wouldn’t be surprised if a casual street poll in Santurce, a neighborhood in Puerto Rico’s capital, revealed that no one knows who Robert Mujica is. He was seated at the witness table, about to deliver his opening statement. Under the table, I could see his restless legs moving — black shoes, toes pointed, heels bouncing up and down nonstop. Alongside the standard blazer that lends gravity to this type of official setting, Mujica wore bracelets that seemed to belong to a part of his past he hadn’t let go of. He had two on each wrist. One had a hippie or surfer vibe — woven threads in several colors. Another leaned more esoteric or new age — black with small silver beads linked together.

Once he began speaking, he appeared more at ease. I assumed the nerves faded once he realized the questions wouldn’t be too tough. And, following a now-popular trend, Mujica leaned into patriotic sentiment, emphasizing his Puerto Rican background, which he described as his heritage. He shared that his parents had left Puerto Rico for New York during the historical period known as “The Great Migration” in the 1940s. His grandfather, he said, opened a bodega where, as a young man working the register, he learned to count money.

He also shared that his parents, both public servants, had worked at the New York City Office of Management and Budget following the city’s declaration of financial insolvency. For that reason, he said, taking on his role with the Board in January 2023 was “personal” to him. Before that, he served for seven years as New York State’s budget director and held other financial positions within the state legislature. Mujica studied sociology at Brooklyn College, part of the City University of New York, earned a master’s degree in government administration from the University of Pennsylvania in Philadelphia, and holds a Juris Doctor from Albany Law School.

That background — and his emphasis on his Puerto Rican heritage — didn’t stop New York Democratic Representative Alexandria Ocasio-Cortez, who also has Puerto Rican roots, from reminding those present of the darker side of the Board.

“The Board has, for years, imposed devastating budget cuts to Puerto Rico’s health care system, pensions, and education,” said Ocasio-Cortez.

But that was it. Even Ocasio-Cortez, usually fiery in her speeches, sounded like someone who had come to terms with the idea that the Board is the only viable option left to resolve Puerto Rico’s government debt. At this stage of the game, with most of the debt already restructured, opposing the Board feels futile — a battle that has been fought but ultimately lost. The narrative has shifted: from being a reviled, anti-democratic entity seen as a guardian of Wall Street’s interests, the Board is now being recast as a defender of the people against the vulture funds.

In a matter of minutes, Ocasio-Cortez shifted from posing rhetorical questions with predictable answers — appearing to “hold the Board accountable” — to attacking the vulture funds. A move that now feels out of step, given that most of those speculative investment firms have already collected their share.

“Is it true that over the past 10 years, the Board has restructured nearly all of Puerto Rico’s debt?” Ocasio-Cortez asked Mujica.

Once again, Mujica repeated: “Yes, nearly all of it — except for PREPA’s.”

“How much does PREPA have to pay its current bondholders?” Ocasio-Cortez asked.

Mujica: “$2.6 billion is the Board’s plan.”

Ocasio-Cortez: “I understand that some bondholders disagree with that amount and are demanding to be paid $12 billion.”

Mujica: “Yes, they’re asking for $12 billion.”

Ocasio-Cortez: “Mr. Mujica, I see here that one of the major Wall Street firms fighting for that $12 billion is GoldenTree Asset Management, correct?”

Mujica: “Yes, that’s correct.”

Ocasio-Cortez: “One year after PREPA’s bankruptcy, GoldenTree publicly announced its initial investment in it. Four and a half years after the bankruptcy, GoldenTree had tripled its investment in PREPA bonds, reaching $1 billion. That was after the bankruptcy. That is the very definition of a vulture fund. This is exploitation — an abuse of legal loopholes for unfair practices. And now, these people, who knew the debt was not viable and bought it after the bankruptcy, are demanding $12 billion, trying to prematurely shut down PROMESA’s operations to receive that $12 billion, instead of the $2.6 billion that was determined and independently negotiated.”

There were other testimonies as well, including one from Puerto Rico’s resident commissioner in Washington, D.C., Pablo José Hernández, who has a voice but no vote. The Popular Democratic Party member emphasized that going nine years without achieving a balanced budget is a major failure for the Board. He asked Mujica who was to blame for that — the Board or the government. Unsurprisingly, Mujica said it was the government, which had no representation at the hearing. Hernández argued that both were to blame.

In the end, the Board stays. The same rules of the game remain in place — rules that allow vulture funds to continue their push to collect on the debt. And the Board will continue to operate as it has always done, with no real oversight or accountability mechanisms imposed upon it.

When the hearing ended, Mujica stood from his seat, once again surrounded by his entourage of aides. His expression was calm and content. The nervousness from earlier had turned out to be nothing more than a passing scare.

This translation was generated with the assistance of AI and reviewed by our editorial team to ensure accuracy and clarity.