Category: Problems in Vieques

BACKGROUND

Certain words like lawyer, tax, developer, privatization, gentrification, and a host of others, often elicit negative responses in people.  Many have experienced or witnessed undesirable outcomes at the hands of, or results from, some of these nouns.  This generalization provides a huge disservice to any and all rational discourse. The noun is not the determinant of good or evil, it’s the adjectives (excellent, horrible, just, unfair, etc.) that make all of the difference.

Privatization is an ambiguous commonly used word that can mean:

• Government transfer of a business or service to private sector ownership and/or control;
• Government contracting of a business or service with the private sector; or
• Government “partnering” with the private sector to operate government owned assets.

The primary legal and justifiable reasons for government to involve the private sector are:

• Raising money through selling assets and/or securing additional investment funds;
• Extracting the government from an uneconomical or losing political venture; and
• A government lack of technical expertise to effectively run the operation.

Privatization of the ATM is being attempted for all of the above reasons.

Granting of favors to “rent seekers”, cronies, and political donors are common illegal purposes.

 PRIVATIZATION UNDER P3

Privatization of a government service is neither good nor bad on its face. To be good, it is important that the process is structured to effectively achieve the community’s goals.  Properly designed, a contract can facilitate the enforcement of strict compliance with the needs of the customers, including everything from operational performance to fees for services.  Bad is illustrated by two of the projects currently in the bidding phase under the P3 program: the ATM (ferry services) and the San Juan Pier operation. This privatization process, as specifically established by the enabling law, is deeply flawed and horrible for Puerto Rico.

The devil is always in the details, and the ultimate determinant of success is the outcome for the stakeholders. But how can any community satisfaction result from P3 legislation that allows the process of defining the bidding and performance specifications to be created and approved without the knowledge of, and input from, the users, customers, and existing service providers? IT CAN’T! It’s selling out our people; it’s flimflam!

The law presumes that the “superior” insight of the backroom P3 architects trumps the actual experiences, opinions, and needs of everyone else. No mechanism is provided or offered to educate, discuss, collect meaningful data, or exchange ideas with the community. Officials’ ignorance of the issues, susceptibility to influence peddling, and lack of best-practice expertise in the industry are hidden from public view due to a total lack of transparency and a wall of legal protections designed for that purpose. That arrogance of the elite ruling class that was protested-out-of-office still permeates the mentality of many who remain.

The losing battle that is being waged by Viequenses to improve the ATM is not primarily a war for or against privatization, but rather a plea to our government to listen to us and fix the deplorable, dysfunctional system – or to SUPPORT US IN DOING SO OURSELVES. The problem is that the people in charge of creating the solution are not qualified and have not included the stakeholders in specifying the needs of the communities of Vieques and Culebra.

As reported in the Caribbean Business September 1^st edition: “San Juan Pier Privatization Sails Under Radar”, we see the same modus operandi from the P3 organization to ignore the stakeholders, many of whom know far better what is needed than the financial wizards who put such deals together. This law makes selling out easier than selling. This is how dictatorial regimes, monarchies, and corrupt democracies operate. We deserve better, but it will not be “given” to us, we must work to earn it, and that means attacking the legality of the law and the integrity of the lawmakers. Our past efforts at cleansing the government were inadequate: We didn’t get all of the rot!

PDF Version

My opinions and criticisms of the cargo system are not aimed at the impossible situation faced with just Isleno running, but rather the larger picture we’ve encountered even before we lost the other boats. The current situation – with the limited availability of the cargo ferries – became inevitable a couple of months ago, and unless someone can pull a qualifying cargo boat out of a hat, we’re screwed for a while.

I have had the opportunity to meet with a number of government officials in the last few months, and the lack of understanding is ubiquitous and palpable:

Juan Maldonado, Director ATM

• • • Well educated attorney with two other simultaneous government positions;
    • Pleasant personality, political appointee, and friend of the Governor;
    • Had what he thought was qualifying experience because he worked with union contracts via the Urban Train;
    • He didn’t know anything about running a ferry system but felt his experience was sufficient, so that when combined with operational help from ATM staff, it would work;
    • He listened to comments and suggestions from many sources, but drank the Cool-Aid and believed his staff; and
    • He was forced by the Governor to open the short route almost immediately at all costs with no excuses.

Omar Marrero, Director PPP

• • • Super smart and powerful finance guy;
    • Been working on privatizing ATM at all costs for a couple of years, but he shows little knowledge of a proper ferry operation;
    • His desire to include stakeholders in the process in any way is next to zero;
    • If he understands the needs of the communities, he hides it well;
    • At a small meeting for dialogue, it was pretty much one sided: this is the way it is, and we really don’t need to listen to you because you have no standing;
    • He is urgently focused on ridding the government of the ferry problem and dumping it onto a private contractor; and
    • His lack of accurate data analysis will cause the problem to resurface shortly after a contract is signed – if that ever actually happens.

Mara Perez Torres, Director, ATM

• • • Well enough educated financial type charged with privatizing the ATM under Marrero’s direction;
    • She has no operational experience but seems to be a good person and genuinely trying to do a credible job for Vieques and Culebra;
    • She brought in José Vásquez Colon to provide the maritime experience;
    • Numerous public statements have reflected great naiveté – in departure from reality;
    • When I asked why the boat was spending the nights in Ceiba instead of Vieques (when the schedules grossly favor the opposite) she said because the crews were residing on the main island;
    • When asked why not make the crews, some of which are Viequense, stage out of Vieques, she had no answer;
    • When I asked what the schedule for cargo was to be after privatization, she said that it would be reduced; it was pointed out that the same crews using the same fuel as is currently burned could almost double the number of trips using Mosquito Pier, and she responded that they hadn’t thought of that;
    • When asked why they don’t put a finger pier (perpendicular to the ramp) in for side loading passengers at the cargo area, she said that it is not a consideration because it would take ten years to get it approved, reflecting a cynical view probably from one of her underlings; and
    • Her claim that the rocks someone dumped at the PRFF section of the pier required a USCG evaluation before they could be removed (and the dock re-inspected) appears not to be the problem at all since it has been four months, and nothing official has been done.

José Vásquez Colon, ATM

• • • Nice guy with years of experience in maritime activities, although none in ferry type operations;
    • In mid-June, he told me that the cargo operations were going to be moved to Mosquito by July, just several weeks later;
    • When asked why maintenance was not being done on the boats at night, he stated that the union contract requires overtime pay for night, and they couldn’t afford it;
    • I asked why they don’t just hire shift workers for swing and graveyard shifts, and he said that it hadn’t been considered;
    • When I suggested that maintenance shift work be in the contract for privatization, he allowed that it would be a good idea;
    • For several weeks they were running two scheduled boats around 10:00PM from VQS to Ceiba – one ran light, and the other ran empty – what were they thinking? And
    • Let’s hope he can quit drinking the Cool-Aid and use his own brain.

PorFerry.com is an excellent idea, but if they can’t keep up with the scheduling, the wrong information is worse than none. They had posted a 9:00PM return to VQS for a long time, but it was actually departing at 8:00 or 8:15, and that stranded many. That’s operational management and doesn’t require an additional budget expenditure.

The government is being squeezed by the FOMB, and the ATM is feeling the result from all directions. Roselló just wanted to get rid of the ATM before it exploded. Unfortunately, in their haste to move everything along ASAP, they screwed it up beyond belief. Now, the new Governor has it sitting in her lap, and I’m certain she has no idea what to do with it and doesn’t have funds to apply to it easily.  I look at the short term – next several months – as being beyond repair. Anything we do short of negotiating our own deal is a waste of time. It’s too early to make order out of this level of chaos.

Under the long-term, government enforced embargo, the shipment of goods and vehicles between Vieques and Isla Grande has been so constrained that our community is not economically viable. The extreme restriction of cargo services denies us the ability to live normal lives, start and run businesses, and grow the community as we see fit.

What we know:

1. The former Governor decided to create a public-private partnership to operate the ferry systems for Puerto Rico.
2. An RFP was issued about 8 months ago to 5 prequalified bidders, but not shared with the stakeholders. The winning bidder is currently negotiating with the Maritime Authority (ATM).
3. The RFP is SECRET, but we know it is designed to relieve the PR Government of day-to-day issues, reduce subsidies, and eliminate long and short-term expenditures from dwindling budgets.
4. Due to recent permitting and EPA violations in the construction of new, yet instantly obsolete, facilities, the $30M funding for capital improvements promised by the FTA (Federal Transportation Administration) have been placed on hold.
5. The ATM is in crisis mode and overwhelmed by the sheer magnitude of the problems within the organization. They are just trying to hold things together long enough to dump it onto a private operator. Their desperation will most probably cause them to make a very bad deal.
6. The accumulated deterioration of the improperly maintained boats has created a situation that is too difficult for them to solve. Director Mara Perez Torres has no real experience in the industry or best practices, and she relies upon personnel with years of misinformed operational and maintenance management experience: people who have learned the ATM way. Corruption at multiple levels has been documented. The solutions these incompetents try to implement are horrific and laughable to real professionals.
7. While some managers may be trying to do a good job for the communities they serve, they are often ill-prepared, over their heads, and don’t realize how much they don’t know.
8. Governor Wanda Vazquez Garced, as each new administration claims to be, is appalled by the disservice to the island communities. Each typically appoints a new director (or multiple directors) as the situation reoccurs ad nauseum. Each time, we start over with promises. Without exception, the directors are over confident, ignore the pleas of the stakeholders to be involved, and drink the Cool-aid fed to them by the ATM organization. Without exception, there is no long-term improvement, and the cycle repeats.
9. ATM management has been so politically corrupted, incompetent, and/or delusional for decades that they use the same old arguments to justify holding back Vieques services. In April of 2018 the ATM published a criminally fallacious D&C study as a draconian preliminary to the RFQ process for ferry privatization. My personal response addressed the fraud they were attempting to wage. The actual official RFQ was improved still lacking. Nonetheless, the lies and misconceptions remain today at every level of the ATM.
10. Many are in survival mode and still don’t care at all about their customers.

Requests by residents, as the primary stakeholders, to have a seat at the planning and oversight table have been denied. Local attempts to establish a cooperative to create, own, and oversee the operation of a ferry service have been rebuffed by Omar Marrero, who claims that the plea is too late and that proposals cannot be accepted during the period an existing RFP is pending. Since the term of the contract he has crafted is 23 years, an entire generation of islanders is going to be sentenced to:

• failed economic development,
• inaccessible medical services,
• severely constrained education,
• limited commerce, and
• denial of the pursuit of happiness.

The ferry system required to sustain our island is key. If government can’t do the job, stop blocking us: quit! Give us time and support to set up a cooperative instead of denying us participation and preventing us from increasing our capacity. Or, if you prefer, consider some innovative solutions that reach well beyond the ferry and provide economic development for Puerto Rico otherwise unachievable.

I have been visiting Vieques since 1973.  I love this island and love living in Puerto Rico.  However, something is terribly wrong with the relationship between Vieques and the Commonwealth.

As a full-time resident of almost fifteen years, I joined the community in the realization that Vieques is treated like the bastard stepchild, or as my friends and neighbors say: “the tail of the dog”. It truly hurts to see our citizens discriminated against and abused by those who think us unsophisticated or jíbaros, and I’m outraged that we are constantly treated that way by our own government.

Naturally, life on a small island comes with limitations and inconveniences associated with the difficult logistics of transporting people and cargo back and forth.  While the isolation can be a hassle, it also contributes to the quality of life one enjoys away from the hustle and bustle of more mainstream communities.  As our Commonwealth has become more socialistic and our citizens more dependent on government to provide services and opportunities, the progress made to offer some of these services in Vieques has been reversed. Under the current economic situation, cutbacks have caused the reduction in municipality funding & services, closing of local offices, and increased demands requiring us to visit offices located throughout Isla Grande.  With the destruction of our hospital (CDT), we are even more dependent upon main-island medical services.

Our road to government, medical, and commercial offices passes through 9 miles of ocean.  This road is controlled by Ports Authority and barely accessible, therefore, we are fully dependent on the Autoridad de Transporte Maritimo. The entire ferry system (ATM) is now, and has been, so totally mismanaged and dysfunctional that it has almost single-handedly crushed the economy of Vieques, and its stated plans for reduced services are further dashing the hopes for our future.  This has the opposite result of the implied intent of the many programs that La Fortaleza has claimed will turn around the economy.

The economy of Vieques is fundamentally rooted in tourism (we have absolutely nothing else at this time), and to that end, we need to develop our island’s infrastructure and amenities in a sustainable manner.  We want to improve our quality of life without losing our way of life or damaging our natural resources.  Unfortunately, the current cargo ferry system makes this utterly impossible. Under the long-term, government enforced embargo, the shipment of goods and vehicles between Vieques and Isla Grande has been so constrained that our community is not economically viable. The extreme restriction of cargo services denies us the ability to live normal lives, start and run businesses, and grow the community as we see fit.

Until 2010 or so, Vieques had 15 ATM cargo ferries allocated to service the island per week, which equated to about 320 vehicles. During the ferry maintenance crisis at that time period resulting in the loss of several boats, the PR Fast Ferry was hired by Gov Fortuño to augment the service with their own boats and crews. Because the passenger ferries were out of service, the ATM substituted cargo ferries (with limited passenger space) for all Vieques runs. Although meeting schedules was still most often impossible, the seven ATM round trips a day (4 each on weekends) were all cargo vessels and brought the intended total ATM cargo trips per week to a total of 43 – almost three times the normal allotment – and with a far more useful range of departure times. The 15 supplemental trips by PRFF resulted in just under 60 round trips per week – almost four times the vehicle capacity of previous years and over twice as many as currently scheduled.  Assuming that the boats all ran, we had the capacity to move 1200 vehicles. Some ATM personnel resented (and still do perform “sabotage” on customer service) the PRFF and often would not allow reservations, forcing many to waste time going standby.  On other occasions, agents refused to sell tickets while the boats had space available.  Despite this subversion, the boats tripled the cargo volume to an estimated 800 vehicles. The point here being that there is significantly more demand than the current horrible level of service can meet.  With a more reliable, better scheduled service, the pent-up demand could fund a significant increase in service.

While not caused by the current Director, Mara Perez Torres, ATM management has been so politically corrupted, incompetent, and/or delusional for decades that they use the same old arguments to justify holding back Vieques services. In April of 2018 the ATM published a criminally fallacious D&C study as a preliminary to the RFQ process for ferry privatization. My personal response addressed the fraud they were attempting to wage. When the actual RFQ was released, some of the issues were corrected, but the lies and misconceptions remain today at every level of the ATM. The final issued RFP remains secret.

Each new gubernatorial administration claims to be appalled by the disservice to the island communities, and each appoints a new director (or multiple directors as the situation reoccurs ad nauseum). With each new director, we start over with promises. Without exception, the directors have no meaningful operational experience and drink the Cool-aid fed to them by the ATM organization. Without exception, there is no long-term improvement.

Vieques has one of the highest unemployment levels in Puerto Rico, with a very high rate of population decline.  We cannot create jobs for our residents or start and run businesses without adequate cargo service.  We have lost existing jobs because the ferry system did not offer the capacity to export containers of materials under federal contract.  Growth of existing businesses is constrained and starting new businesses, that require the regular delivery of products and/or materials, is generally impossible under our allocation of ferries.

As our government and medical services are cut back on Vieques and moved to big island locations, we cannot afford to rent cars every week to make repeated visits to offices and clinics.  We have some of the worst health statistics in Puerto Rico.   Many locals without credit cards and students currently cope with very lengthy and circuitous routes of public transportation.  A simple visit to a doctor or government office burns a day of work.

Household goods, food, fuel, building materials, services, etc. are only available here in limited quantities and with limited selection.   Monopolies are the rule.  Monopolies form for one of two reasons:  either there is inadequate market support for multiple competitors, or the existing merchant works to prevent competition from gaining access to the market.  In either case, Vieques suffers from higher prices, reduced customer service, and inadequate product availability.  Without competition there is no advertising.  Without advertising, there is no newspaper.  Without a local newspaper, we are kept in the dark:  divided and conquered.

The core cause of the issues outlined above is INADEQUATE CARGO FERRY SERVICE! Demands for a bridge by some residents reflected the recognized needs for reasonable access to and from the island.  An improved ferry system is one answer at a fraction of the cost.

Just a cursory review of the existing ferry system shows inadequate and inappropriate locations, facilities, equipment, and operations.  As a person who spent a few years in aviation operations and maintenance, I can cite many, many details of failure here.  Keeping this discussion as a “top down”, overall perspective, political management of this technical operation has been a disaster.  The ATM demonstrates an appalling lack of competence, as well as a lack of sensitivity and concern for the wellbeing of thousands of Puerto Ricans.  It is hard to believe that the past operation of the system was anything less than an attempt to punish Vieques for something, or an indication of some criminal scheme by ATM officials.

Government’s role is to provide adequate transportation infrastructure to foster commerce and public access to services.  The entire road and highway system of Puerto Rico is provided for these same purposes.  The road is not a profit center; it is not a business; and it does not make money.  We know that the Central Government is broke. We know that the myriad of problems of the ATM are not caused by the new Governor, Wanda Vazquez Garced. We believe that she must want to rid her administration of the constant recurring failed ATM. But the solution offered by the Roselló administration is horrific and unsatisfactory as efforts are being made to opaquely implement it.

Requests by local residents, as the primary stakeholders, to have a seat at the planning and oversight table have been denied.  Local attempts to establish a cooperative to create, own, and oversee the operation of a ferry service have been rebuffed by Omar Marrero, who claims that the plea is too late and that proposals cannot be accepted during the period an existing RFP is pending. Since the term of the contract he is letting is 23 years, the islands are going to be sentenced for more than an entire generation to:

• failed economic development,
• inaccessible medical services,
• severely constrained education, and
• deprivation of the pursuit of happiness.

The ferry service required to sustain our island is key.  If government can’t do the job, it should quit!  Give us time and support to set up a cooperative. Or, if preferred, consider some innovative solutions that reach well beyond the ferry and provide economic development for Puerto Rico otherwise unachievable.

UPDATE ALERT!

Within several days of the published post, the Governor’s office called to confirm the situation. Shortly thereafter, the Kike Tire application was accepted. It took over a month to secure the equipment, but the inspection site is up and running well! While DTOP may have been aware of the unsatisfactory situation, La Fortaleza was not. Thanks to the rapid response of the Governor’s office, our mini-crisis has been rectified.

The bold-faced battle of the bureaucracies at our expense is on. Maybe we should just say no.

DTOP: The marbete
• In order to maintain the currency of a vehicle license, one is required to pay an annual licensing fee and procure insurance. But, before one is allowed to pay these fees, each vehicle is required to obtain a certification that the emissions are compliant and the vehicle has passed a safety test. The published cost of these tests is $11.00.
• Vieques has had only one inspection station, and the operation has been corrupted for at least the last 15 years or more: pay $20.00 and certification is granted without any inspection – it’s just a bribe. Many inspection stations on the main island operate in a similar manner.
• The only inspection station on Vieques has closed, ostensibly, due to DTOP requirements for new equipment.
• Kike Tire applied for a license to perform the inspections about a year and a half ago. Their facility was inspected and passed with flying colors. They still have not received permits or any word on their status.

POLICE DEPARTMENTS: The ticket
• Our inability to secure inspections on the island has definitely NOT deterred our police departments from awarding tickets to those who have expired marbetes.
• When officers are questioned about the reasonableness of this, their responses include: “Not my problem!” and “Just send your paperwork over to one of the inspection sites in Fajardo that will fraudulently certify it for $20.”

ATM: The choke point
• The ferry system is corrupt, extraordinarily poorly run, and lacks cargo/vehicle capacity to even supply and maintain normal life in Vieques – much less allow any economic development. On a good day (and there aren’t enough of them), there are 5 cargo ferries that can transport up to 20 cars and a few trucks per trip. Reservations are nearly impossible, and most residents are told to go “standby”. Often times drivers and vehicles become stranded out overnight.
• There are approximately 6,000 registered vehicles in Vieques, which means that in order to accommodate these inspection trips alone, an additional ferry would be required every day. That is NOT going to happen!
• To add insult to injury, if the marbete has already expired, the ATM will not allow the vehicle on the ferry without a $17.00 DTOP temporary pass.

ATM: The ordeal on a good day
• The cost for the car is $25 ($55 for a van)
• Show at 5:30 am for standby
• Depart at 6:30 am
• Arrive at Fajardo at 8:00 am
• Purchase return ticket at the Fajardo office
• Go to inspection station and be tested
• Return to ferry at 10:00 am
• Depart Fajardo at 1:00 pm
• Arrive Vieques at 2:30 pm

VIEQUES CITIZENS: The whipping boys
• Vieques is a colony of a colony, and as such, has no influence on any governmental issue. All representation is from residents of the main island, not from here. These people only pay lip service to our needs. We are treated as inmates in an institution. We are laughed at in San Juan political circles.
• Vieques is a poor island without adequate infrastructure. The maximum speed limit is 35 MPH. There is not a single operating professional automobile service station capable of typical maintenance or contemporary computer-based diagnostics or tuning.
• Most vehicles are “island cars” that are old and beat up. Most residents cannot afford later model cars or significant maintenance. Working residents cannot afford a full day off to go to the main island for an inspection.

RATIONAL THOUGHT: The solution
• Suspend the inspection requirement in Vieques for a marbete until DTOP/CESCO or whatever authorities need to approve a new inspection facility act; or
• Eliminate the inspection requirement for Vieques completely since it has NEVER been operating legally or effectively; or
• Something else. Most of us try to follow the rules. Most of us believe that laws are not to be broken. But what are we supposed to do when the laws are ridiculous, and the systems are broken? What are we supposed to do when our complaints are ignored? What are we supposed to do when officials are saying they know it’s broken, and here is how you waste your time and money to get around it – or we will give you a ticket? I say you tell them NO! I say we stand together to fight it – in court if necessary. We all know the government is both corrupt and incompetent. This is not a time for the same passivity that has plagued the island forever. Basta ya! Enough of the BS.

This bureaucratic obsession with unreasonable requirements and the resulting illegal response is known by all – yet it is not only tolerated but enforced. We need a rational and trustworthy government, but the world can see that is not what we have here. That is why others don’t wish to risk dealing with Puerto Rico. That is why we will have no significant economic development for the foreseeable future. We need to fight business as usual – IT’S NOT WORKING!