Trump administration dismisses all Democrats on a federal board
overseeing Puerto Rico's finances
[August 06, 2025] By
DÁNICA COTO
SAN JUAN, Puerto Rico (AP) — The Trump administration has dismissed five
out of seven members on Puerto Rico’s federal control board that
oversees the U.S. territory’s finances, sparking concern about the
future of the island’s fragile economy. The five fired are all
Democrats.
A White House official told The Associated Press on Tuesday that the
board “has been run inefficiently and ineffectively by its governing
members for far too long and it’s time to restore common sense
leadership.”
Those fired are board chairman Arthur Gonzalez, along with Cameron
McKenzie, Betty Rosa, Juan Sabater and Luis Ubiñas. The board’s two
remaining members — Andrew G. Biggs and John E. Nixon — are Republicans.
The board confirmed in a brief statement that the five were terminated
and noted that the board would continue to fulfill its mandate and work
“in the interest of the people of Puerto Rico.”
Sylvette Santiago, a spokesperson for the board, did not immediately
return a message seeking comment on whether the board members would
fight the decision.
Meanwhile, Rep. Nydia Velázquez, a New York Democrat, criticized the
dismissals though she acknowledged what she said were “serious and
longstanding concerns” about actions the board has taken, including
implementing austerity measures.
“This sudden purge by Donald Trump is not about justice or reform," she
said in a statement. "It simply creates an opening to stack the Board
with even more extreme, pro-bondholder appointees who will continue to
put the needs of hedge funds over the Puerto Rican people.”
The board was created in 2016 under the Obama administration, a year
after Puerto Rico’s government declared it was unable to pay its more
than $70 billion public debt load and later filed for the biggest
municipal bankruptcy in U.S. history.
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 In remarks to the AP, the White
House official claimed the board had operated ineffectively and in
secret and said it “shelled out huge sums to law, consulting and
lobbying firms.” The official, who spoke on condition of anonymity
to discuss the subject, also accused the board’s staff of receiving
“exorbitant salaries.”
Puerto Rico is struggling to restructure more than
$9 billion in debt held by the state’s Electric Power Authority,
with officials holding bitter mediations with creditors demanding
full payment.
It’s the only Puerto Rico government debt pending a restructuring,
with the White House official accusing the board of preferring to
“extend the bankruptcy.”
In February, the board’s executive director, Robert Mujica Jr., said
it was “impossible” for Puerto Rico to pay the $8.5 billion that
bondholders are demanding. He instead unveiled a new fiscal plan
that proposed a $2.6 billion payment for creditors. The plan does
not call for any rate increases for an island that has one of the
highest power bills in any U.S. jurisdiction as chronic power
outages persist, given the grid’s weak infrastructure.
Alvin Velázquez, a bankruptcy law professor at Indiana University,
said he worries the dismissal of the board members could spark
another crisis in Puerto Rico.
“This is really about getting a deal out of (the power company) that
is not sustainable for the rate payers of Puerto Rico,” he said.
Velázquez, former chair for the unsecured creditors committee during
the bankruptcy proceedings, also questioned if the dismissals are
legal, since board members can only be removed for just cause.
“What’s the cause?” he said. “What you’re going to see is another
instance in which the Trump administration is taking on and testing
the courts.”
The dismissals were first reported by the Breitbart News Network, a
conservative news site.
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