Fiscal Board flags $85M telecom contract at Puerto Rico's Department of Education

The Fiscal Oversight Board (FOMB) has flagged the Puerto Rico Department of Education (PRDE) after discovering the agency executed a telecommunications contract with Puerto Rico Telephone Company (Claro) valued at $85,462,945.33 — without submitting it for the Board's review as required under the PROMESA Act ¹.

The finding, made public in a July 20, 2026 letter addressed to Education Secretary Eliezer Ramos Parés, exposes a pattern that has raised alarms about transparency in how public funds for school and library connectivity are being managed ¹.

How the contract was structured

The timeline is key to understanding why the Board is upset:

• June 27, 2025: The FOMB approved an initial version of the contract with observations ¹.
• July 3, 2025: Instead of proceeding with that approved document, the PRDE signed a different contract — number 2026-000035 — with an initial value of just $1.2 million ¹.
• July 29, 2025: Less than a month later, the PRDE executed a first amendment that ballooned the contract's value to the full $85.4 million and extended its term through June 30, 2029, with options for two additional one-year extensions ¹.

None of those steps — neither the new contract nor the multimillion-dollar amendment — were submitted to the Board for review ¹.

The numbers and the rules

Under PROMESA Section 204(b)(2), any contract or related amendment valued at $10 million or more requires review and approval by the Fiscal Oversight Board before execution ¹. The $85.4 million contract exceeds that threshold by more than eight times.

FOMB legal advisor Jaime A. El Koury stated in the letter that "the PRDE did not submit contract 2026-000035 nor its first amendment to the Oversight Board for review and approval, as required by the Policy" ¹.

The services covered under the contract include:

• Wide-area network (WAN) connecting school campuses
• Internet service
• Content filtering
• Telecommunications
• Wi-Fi equipment for schools and libraries ¹

Where the money comes from

A significant portion of the contract is funded through the federal E-Rate program, administered by the Universal Service Administrative Company (USAC), which covers 90% of eligible costs ¹. The PRDE pays the remaining 10% plus any non-eligible costs using general and special revenue funds ¹.

At the time of publication, the Department of Education had not responded to requests for comment on the Board's objection ¹.

What this means for you

This contract determines whether your child has working internet at school. We're talking about campus connectivity, the Wi-Fi students need to complete assignments, the digital tools teachers use, and the content filtering that protects minors online.

The fact that the PRDE executed an $85 million contract without the legally required oversight is concerning because it removes an accountability step designed to protect taxpayers. The money is 90% federal, but the remaining 10% — millions of dollars — comes from local public funds, and the contract structure (through 2029 with extensions) commits resources for years.

If the contract has problems with pricing, scope, or execution, the ones directly affected are students who depend on those telecommunications services in their classrooms.

How to take action / Checklist

1. Check your school's connectivity — Ask the principal whether the campus has working internet and Wi-Fi. If there are service issues, document them in writing.
2. Request public information — You can request a copy of contract 2026-000035 and its amendment from the PRDE through a request under Puerto Rico's Transparency and Expedited Access to Public Information Act (Law 141-2019).
3. Contact the Board — If you have relevant information, the FOMB has a direct line: (787) 641-0001 and email at [email protected].
4. Monitor the process — The Board demanded corrective measures. Stay alert for upcoming public communications from the FOMB about whether the PRDE complies.
5. Talk to your legislator — The legislative education and finance committees have jurisdiction over these contracts. Contact your representative or senator to demand oversight.

What comes next

The Fiscal Oversight Board demanded that the Department of Education implement corrective measures to ensure future contracts go through the required review process. It remains to be seen whether the FOMB will take additional action on the already-executed contract — including the possibility of requiring a renegotiation or retroactive review of the agreement with Claro.

The contract runs through June 2029 with two optional extensions, so the decisions made now about oversight and compliance will impact the telecommunications infrastructure of public schools for the next three to five years.

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Sources:

¹ Metro Puerto Rico — Junta levanta bandera por contrato millonario en Educación de telecomunicaciones