treAsury issues return-to-Work ProgrAm rules

Puerto Rico Treasury Issues Returnto-Work Incentives Program Rules

Report from O’Neill & Borges outlines the details

THE WEEKLY JOURNAL Staff

The Puerto Rico Treasury Department has issued Circular Letter 2021-18, establishing the rules to apply for the Returnto-Work Incentive Program announced by Gov. Pedro Pierluisi in June 2021, according to a report by San Juan-based law firm O’Neill & Borges LLC.

The program has up to $150 million for eligible individuals on the island who return to work before Sept. 4, 2021 in industries such as hospitality, restaurants, agriculture and construction.

“The Return-to-Work Incentive Program aims to help Puerto Rico emerge from the COVID-19 pandemic and assist industries in need of economic development, making available up to $150 million for eligible individuals who return to the workforce in specific industries before

Sept. 4, 2021. Of the total amount available, $50 million is allocated for eligible individuals returning to work in restaurants and bars; $20 million for the hospitality industry, $30 million for the agriculture industry, and $30 million is available for the construction industry,” as per the report, written by O’Neill & Borges attorneys

José F. Benítez and Laura E. Díaz, of the firm’s Labor and Employment Department. The program rules adopted in Treasury’s Circular Letter 2021-18, which was issued on Aug. 30, establishes that eligible employees may receive an initial award payment of $500 when hired before Sept. 4, 2021, and award payment of $1,500 if they meet the eligibility requirements provided in the Circular Letter. Both awards are paid directly to the employee, according to the two attorneys. The program operates as part of the federal government’s Coronavirus State Fiscal Recovery Fund.

As provided in the Circular Letter, the eligibility criteria for participating in the program are the following:

Eligible employers must meet all the following criteria: • Be a private sector employer; • Be an active business at the moment of applying for the grant; • Be engaged in the food and beverage (bars and restaurants), hospitality, agriculture or construction industries; • Be duly registered in the Merchants Registry of the Department of the Treasury, and have at least one of the NAICS Codes listed in CC-21-18 as their main trade or business activity; and • Have filed a 2020 Puerto Rico Income Tax Return or a Request for Extension of Time to File the Income Tax Return (Form AS 2644) for taxable year 2020.

Eligible employees must meet all the following criteria: • Be receiving Pandemic Unemployment Assistance (PUA) up until the date in which they started working in an eligible industry; • Stopped claiming unemployment benefits upon receiving offer of employment in an eligible industry; • Start working with a new employer with an eligible NAICS code, as provided in CC-21-18; • Secure part-time or full-time employment with an eligible employer between July 1, 2021, and Sept. 4, 2021; • Commit to abide by the

In fact, program’s terms and conditions; and • Agree to return program The program has funds if it is determined that up to $150 million for he or she did not comply eligible individuals with the program’s eligibility in Puerto Rico who requirements. return to work The final award payment before Sept. 4, of $1,500 is subject to the 2021 in industries employee’s continued such as hospitality, employment for at least 90 restaurants, days since the initial award agriculture and payment was received by eligible construction. employees. Applications must be submitted through the Puerto Rico Department of Treasury’s SURI system starting on Aug. 30, 2021. Treasury expects initial award payments to be disbursed by Sept. 30, 2021, and final payments between Dec. 6, 2021, and Dec. 31, 2021, according to O’Neill & Borges.

Ricardo Álvarez-Díaz,

Licensed Architect and co-founder of the architectural firm Álvarez-Díaz & Villalón www.advfirm.com

A Guide to Puerto Rico’s Economic Recovery Funds

One of the ways to boost our economy is to take advantage of all federal programs that focus on the island’s recovery and reconstruction.

The Community Development Block Grant – Disaster Recovery (CDBG – DR) Program was created to grant support to disaster recovery activities, including housing redevelopment and rebuilding. The program is responsible for assuring decent affordable housing opportunities, provision of services, assistance to those most vulnerable in our communities, career opportunities and the conservation of jobs.

The CDBG-DR Program is funded by the Disaster Recovery Program for community development of the U.S. Department of Housing and Urban Development (HUD). The Puerto Rico Department of Housing (PRDOH) has been designated as the entity responsible for administering this grant that will help in the recovery from disasters caused by hurricanes Irma and Maria in 2017. This includes long-term recovery, restoration of housing, economic infrastructure, and revitalization.

The CDBG-DR’s Economy Sector focuses on transforming Puerto Rico’s economic landscape through economic development initiatives. Some of the key programs that the CDBG-DR Economy Sector offers are the Economic Development Investment Portfolio Program and the City Revitalization Program.

The Investment Portfolio for Growth (IPG) Program has been allocated a total of $800 million in the Puerto Rico CDBG-DR Action Plan to fund sizable development projects that are transformative in nature, and create and retain Low-to-Moderate Income (LMI) jobs.

The program intends to award gap funding for largescale commercial and industrial development as well as a wide variety of economic revitalization initiatives. This may include the development/redevelopment of Commercial Developments, Mixeduse Developments and Infrastructure Development in support of an economic development investment.

The IPG Program establishes the funding of projects that will significantly impact and enable the long-term economic growth and sustainability of the island.

The CDBG-DR’s Multisector Program brings together the funds of multisectoral initiatives that incorporate aspects or provide benefits in each of the four sectors that make up the Action Plan. The most important program of the Multisector Program is the City Revitalization Program.

The City Revitalization Program (City-Rev Program) program establishes a fund for municipalities to enable a variety of critical recovery activities aimed at reinvigorating urban centers and key community corridors to focus investments, reduce sprawl and create a symbiotic environment to nurture complimentary investments from the private sector.

The program allocates nearly $1.3 billion from CDBG-DR funds to help shape and implement a future vision in communities that were affected by hurricanes Irma and María. Through this funding, the PRDOH will support the 78 municipal governments and other eligible organizations to undertake a variety of recovery activities aimed at reinvigorating downtown areas, urban centers and key community corridors.

The purpose of the program is to help create projects that will promote the redevelopment, re-greening and restoration of lost natural resources, and further incentivize private investments in restored urban areas.

Using these economic and multisector funds at our disposal will allow us to rebuild our Island and communities. Let’s not waste this incredible opportunity!

Miguel L. Vargas-Jiménez,

Former Executive Director and CEO of the Puerto Rico Chamber of Commerce

Tourists are Flocking to the Island, Thanks to Discover Puerto Rico’s Nonstop Efforts

Tourism accounts for just 6% to 7% of Puerto Rico’s economy.

In my opinion, that number should be twice as high. And we at the Puerto Rico Chamber of

Commerce are supporting the efforts of our partners at Discover Puerto Rico, who are aggressively trying to bolster those tourism numbers.

Fortunately, Discover Puerto Rico has a lot to work with. Few spots in the Caribbean, or anywhere, have the cultural richness, natural beauty, culinary delights and fascinating history as our beautiful Island. But competition for travel dollars – be it from tourists or corporate event planners – is intense, especially amid the COVID-19 crisis and, before that, natural disasters that sent Puerto Rico and other destinations into a tailspin.

Puerto Rico also has to deal with the cost factor. As a territory of the United States, Puerto Rico is more expensive than some other Caribbean destinations, with higher labor, water, electrical power and other resource costs. Those are facts we can’t change, and it simply means we have to work harder to convince potential travelers that Puerto Rico is worth the extra expense (and it is!)

Thus, Discover Puerto Rico – which was formally founded and funded by the Legislature in 2017 – is a muchneeded institution. And their mission as a destination marketing organization (DMO) – an official entity that promotes a location as an attractive travel destination – perfectly aligns with ours.

Since 1913, the Chamber has supported and stimulated the growth of Puerto Rico’s businesses in ways that contribute to the Island’s economic growth. While Discover Puerto Rico is a much younger organization, they have hit the ground running, overcoming natural disasters and a pandemic to position Puerto Rico as a must-see destination for tourists and corporate meetings.

And it’s working.

Despite a century’s worth of devastating hurricanes, earthquakes and a pandemic in just the last four years, Puerto Rico tourism – with a major helping hand from Discover Puerto Rico – has achieved some amazing results. In May and June, room nights sold on the Island surpassed the figures for 2019, which was the Island’s best year to date; and meetings and convention leads also outpaced 2019 totals for nearly every week.

The future looks bright, too. Independent research carried out by Destination Analysts shows that two-thirds of consumers residing in markets targeted by Discover Puerto Rico recalled hearing about travel to Puerto Rico in the past six months and 40% of them anticipate visiting Puerto Rico in the next two years. These figures are much higher than what has been reported by most U.S. states and other Caribbean destinations.