Slash holidays? Close govt agencies? Ailing Puerto Rico looks for ways out of deep slump

The Associated Press

FILE - In this Jan. 15, 2014 file photo, demonstrators touch a giant Puerto Rican flag from underneath as they protest at the labor department during a teachers strike in San Juan, Puerto Rico. From the intriguing to the impossible, there is no shortage of ideas for fixing Puerto Rico’s ailing economy as the government tries to dig out from a whopping $70 billion in public debt and bring back economic growth. (AP Photo/Ricardo Arduengo, File)

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By DANICA COTO, Associated Press

SAN JUAN, Puerto Rico (AP) — Slash the number of public holidays by two-thirds. Eliminate dozens of government agencies. Legalize marijuana and prostitution.

From the intriguing to the impossible, there is no shortage of ideas for fixing Puerto Rico's ailing economy as the government tries to dig out from a whopping $70 billion in public debt and bring back economic growth.

The ideas have come from legislators, entrepreneurs and even members of the public, who have submitted ideas via a government-sponsored website. Of the 369 ideas sent in by the public, 156 have been accepted by a government committee for consideration, including the suggestions to legalize marijuana and prostitution, and to limit how long people can live in subsidized housing.

But all the ideas require further government approval, either with a legislative vote, or an administrative nod from the governor, agency or department. More dramatic ideas, such as legalization of marijuana or prostitution, would require public hearings, legislative approval and the governor's signature.

And prospects for approval of the various suggestions are decidedly mixed.

The governor, for example, is expected to sign a bill approved by lawmakers to release certain elderly prisoners, but not a suggestion floated by a member of the public to charge inmates for their room and board.

Puerto Rico, in dire straits following eight years of recession, has remained receptive as it debates hundreds of ideas: "We are studying all alternatives and all possibilities," said Sen. Maria Teresa Gonzalez, a member of the governor's party who has come under fire for submitting a bill that would reduce the number of holidays for public employees to six.

The island currently celebrates 20 holidays a year, double those observed in the U.S. Many people have bristled at the proposal to scrap some of the additional extra days off, some of which commemorate various historic Puerto Rican leaders. But Gonzalez said the excessive number of holidays costs the government about $500 million a year in lost productivity and interruptions in service, among other things.

"Change always brings about inconveniences," she said. "I'm convinced that before we talk about something as dramatic and disastrous as layoffs, we have to consider other ideas."

Many suggestions have come as Gov. Alejandro Garcia Padilla prepares to submit the first balanced budget in decades, having promised U.S. investors and credit agencies that he will eliminate an $820 million deficit. The governor has not detailed his cutbacks, prompting fears of layoffs, tax increases and cuts to public service.

Opposition legislator Rep. Ricardo Llerandi Cruz has proposed eliminating 41 government agencies, saying it would save $160 million alone in administrative costs. He said the government has many agencies performing the same functions, noting that there's a Department of Natural Resources, which protects, develops and manages the island's environmental resources, and an Administration of Natural Resources, a division within the department with responsibilities that include overseeing projects such as cleanup efforts.

"Puerto Rico is facing the worst fiscal crisis in all of its history," Cruz said. "We need to refocus or revisit governmental priorities to face these problems."

A bill in the legislature also would cap the salaries of mayors, but legislators have been debating the issue for a year as mayors continue to give themselves raises. The full-time mayor of the western town of Maricao, for example, oversees the island's second-least populated municipality with some 6,200 people and currently earns $78,000 a year, nearly double of what he earned the previous year. If the bill is approved, the mayor would earn a base salary of roughly $54,000 a year.