UPR is enduring worst economic crisis in its history
Three members of the University of Puerto Rico’s Governing Board warned Monday that the institution’s worsening financial instability is now a direct threat to Puerto Rico’s long‑term economic competitiveness, issuing an unusually blunt open letter that calls for urgent action from government leaders, fiscal authorities and university executives.
The letter — signed by board members Rafael Méndez Tejera, William Muñiz Rivera and Benjamín Rivera Meléndez — describes the UPR as being in “one of the most difficult moments of its history,” arguing that the crisis extends far beyond budget constraints and now jeopardizes the island’s professional workforce, research output and economic development.
According to the board members, years of budget cuts have already reduced personnel, limited academic programs and deteriorated infrastructure across the system’s 11 campuses. The situation has been compounded by a new controversy over an estimated $44.5 million obligation to the UPR Retirement System, which they say has placed the institution “in a position of vulnerability and uncertainty.” For instance, UPR Carolina suffered a $2 million budget cut, with other campuses enduring a similar fate.
They stressed that the pension system is not a discretionary benefit but “the result of decades of work and commitments acquired with professors, employees and pensioners,” adding that meeting those obligations is “a legal, ethical and moral responsibility.”
The board members warned that treating the UPR strictly as a fiscal liability ignores its central role in Puerto Rico’s economic engine. “The UPR is not an expense; it is an investment for Puerto Rico,” they wrote, noting that the majority of the island’s doctors, engineers, teachers, nurses, lawyers, scientists and other professionals are UPR graduates. Weakening the university, they said, “has consequences that transcend its classrooms,” adding that “when the University is weakened, Puerto Rico loses.”
In one of the letter’s most pointed passages, the three board members criticized UPR President Zayira Jordán Conde for taking vacation leave during what they described as a critical juncture for the institution.
They called her decision “unacceptable and profoundly irresponsible,” arguing that “when the university faces urgent and unavoidable commitments, the president… decides to take vacations.” They said the move “reflects a concerning lack of sense of urgency, weakens institutional trust and sends a message of indifference.”
The letter urges the UPR Governing Board to adopt a more assertive leadership posture and calls on the Fiscal Oversight and Management Board to recognize the university’s strategic value. “No country strengthens its economy by weakening its main public institution of higher education,” the board members wrote, emphasizing that research, innovation, workforce development and professional training all depend on a stable UPR.
They appealed to the governor, Legislature, UPR leadership and private‑sector stakeholders to protect the university’s budget, stabilize the retirement system, avoid further cuts and present a transparent fiscal plan capable of restoring confidence. The board members stressed that the UPR “belongs to all the people,” and that safeguarding it is essential to Puerto Rico’s long‑term economic future.
“Allowing it to continue weakening would be to renounce one of the most important tools to build a better future,” they concluded.
The Financial Oversight and Management Board on June 29 certified a $1.25 billion budget for the University of Puerto Rico for Fiscal Year 2027, formally overriding the versions submitted by the Governor and the university after determining they did not comply with PROMESA’s fiscal requirements.
The FOMB’s certification emphasized that the approved budget fully funds the actuarially required employer contribution to UPR’s Defined Benefit Pension Plan. The university’s proposed budget had funded only the minimum contribution and rejected additional pension reform measures, a position the Board described as fiscally irresponsible because it perpetuates the long‑standing underfunding of the retirement system.
To meet the full pension obligation, the FOMB reallocated resources within the budget, reducing the “Other Operating Expenses” line compared to FY2026 while maintaining support for core academic and operational functions. The certified budget includes $566 million in central government appropriations, $515.7 million in operating revenues, and $173.1 million in federal and intra‑government receipts, for a total of $1,254,969,000 in revenues. Expenditures total $1,218 billion, leaving the university with a balanced operating position after debt service.
The drawbacks of the certified budget stem largely from the strict controls and compliance requirements imposed by the Board. UPR will face tighter restrictions on spending flexibility, including a prohibition on reprogramming funds without prior approval and limits on the use of prior‑year appropriations. The university must submit quarterly revenue revisions, multiple certifications, and detailed reporting under the 2021 Fiscal Plan. Contract oversight also remains in place, requiring Board review of agreements over $2 million, or $10 million for FEMA‑funded projects.
The Board also underscored that UPR’s long‑term sustainability depends on implementing operational and revenue measures required by the fiscal plan. While approximately $170 million in additional Commonwealth funding remains available, those funds will only be released if UPR meets specific milestones verified by the Board.
The largest spending categories in UPR’s budget include $648.4 million in payroll and related costs; $177.1 million in pension payments; $141.5 million in federal grant‑related expenditures; $84 million in “Other Operating Expenditures,” which the Board reduced to redirect funds toward the pension obligation.
