The Money That Never Arrives

A water main break in San Juan, Puerto Rico has led to water shortages since early June. I have written before that my family has a 1,000-gallon fresh water cistern in Caguas, Puerto Rico. They also have their own generators because they have learned that power and water are not things you can count on.

Puerto Rico’s poverty rate is 2x that of Mississippi, the poorest state in the nation — and unemployment is almost 1.5x the national average, improving from historical levels to 5.7%.1 Public infrastructure continues to be underinvested, and the average resident cannot afford to invest in being off the grid and self reliant. Public outrage, and an inept local government, has led to National Guard troops being deployed to help get potable waters to communities now without water for weeks.

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This month the Government Accountability Office reported that nine years after Hurricane Maria, roughly one quarter of the $14 billion ($3.6 billion) Congress set aside to rebuild Puerto Rico’s electricity grid has actually reached the island. FEMA has obligated some $11 billion of it; a little over $2.7 billion has been disbursed.2 The money exists. It was appropriated. It was even obligated — a promise the government has formally made to itself. And still it sits.

When El Apagón — the 11-month long blackout — became the daily condition rather than the emergency, some Puerto Ricans did not wait for the check. In the years following the storms, roughly 200,000 families put solar on their own roofs. Distributed generation now supplies more than a tenth of the island’s electricity.3 The people built the grid the money was supposed to build.

I want to be precise about what went wrong, because the easy story — that Washington doesn’t care about Puerto Rico — is both true and not the useful part. The useful part is this: the failure was not the size of the commitment. It was the channel meant to carry it. Money entered at the top. The need was at the bottom. And in the middle, where obligation is supposed to become disbursement, the pipe was too narrow, too slow, and too easy to close. Complicating matters more, federal law requires that FEMA reimburses states after they repair damaged public facilities.

We spend enormous energy arguing about whether the money is big enough, and almost none on whether the channel between the appropriation and the community can actually carry it. Puerto Rico is the clearest illustration I know. It is not the only one.

Last month, the Supreme Court handed down a ruling that looks, at first, like it has nothing to do with Puerto Rico or with data centers. It has everything to do with both.

John Durnell used Roundup weed killer for about twenty years and got cancer. A jury in Missouri heard his case, decided the company should have warned him, and awarded him more than a million dollars. The Supreme Court took the award away. Not because he wasn’t harmed — the Court never touched that question. It took the award away because the federal government had already approved the label without a cancer warning, and a state jury is not allowed to require a different one.4

The rule behind this is called preemption, and it is a simple idea: when the federal government has spoken, a state — or a jury, or a town — is not allowed to ask for more. Preemption does not decide whether you were harmed. It decides, before anyone asks, whether you are even allowed to be heard. Durnell’s answer was settled years earlier, in a federal office he never set foot in. You can be in the room. You can win the verdict. And you can still have no say over the terms that shape your life. That is access without agency.

My own people have lived in that gap for more than a century. This summer marks ten years since President Obama signed PROMESA, the law that handed Puerto Rico’s budget to a control board — seven people, appointed in Washington, with the final say over the island’s money, above the government Puerto Ricans actually elect.5 A decade later, the board is still there. And Puerto Ricans keep voting. Statehood has won every status vote since 2012, and Congress has done nothing with it.6 Now the two-party system that ran the island for decades has cracked, and a movement for independence and sovereignty has surged into second place — its strongest showing in living memory.7 People are asking, louder than in a generation, to decide their own future. Congress and the board still hold the pen. The people of Puerto Rico have demanded self-determination, and yet they lack agency.

Last summer, Washington moved to fire most of that board without giving a reason. A court has paused it, and the fight isn’t over.8 It is worth watching, because it is the same question we are asking about data centers: who gets to decide, and for whom.

So here is the problem underneath all of it — deeper than whether the check is big enough. It is trust. If the courts won’t protect you, if the board answers to Washington, if your vote doesn’t move the terms, then who, exactly, are you supposed to trust to act in your interest? And it is not only the courts and the boards. The very channels built to carry help to the people who need it are being shut off, too.

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In February I wrote a brief9 about the $27 billion Greenhouse Gas Reduction Fund — the largest single pool of climate capital the federal government has ever aimed at community lenders. I highlighted a structural vulnerability: nearly $20 billion of it flowing through a single fiscal agent, under grant agreements the government could terminate, meant any administration could freeze the whole pipeline with one directive.10

That is roughly what happened. The awards were frozen, litigation followed, and the full D.C. Circuit heard argument this winter in Climate United Fund v. Citibank.11 Then, in a move that made the remedy genuinely uncertain, Congress repealed the fund’s authorizing provision in last summer’s budget law and rescinded whatever balance remained unobligated.12 So the court now faces a strange question: what relief is even available for money that was promised, then frozen, then unauthorized? As of this writing, the money is still not moving. Organizations like the Justice Climate Fund, directly impacted by the clawback of funds, have pivoted and remain challenged to keep communities empowered.

In an annual letter from Amir Kirkwood, CEO of Justice Climate Fund, he expressly commits to centering the voice of communities as it seeks to secure private capital: “Capital availability remains uncertain, and we will not assume a friendlier market than the one in front of us. And as we become more institutional, the deepest risk is a quiet one. It is that in learning to speak fluently in the language of capital, an organization can forget whose problem it exists to solve. We will not,” writes Kirkwood.

Meanwhile, on the other end of the pipe, communities are doing exactly what we say we want them to do in response to more data center projects unfolding. County councils and town boards from Maryland to New York moved to put moratoria in place before the next data center breaks ground — the local fight is spreading.13 They are wiring the demand from the bottom. The question none of them can answer alone is who finances the community’s side of the table. And the federal channels built to do that are narrowing at the very moment the demand is rising.

This is the convergence of climate, capital and community decisions I keep returning to. The climate transition and the AI buildout are, underneath, the same question of infrastructure finance — who fronts the capital, who carries the risk, and who is in the room when the terms are set. We have gotten very good at authorizing money and very bad at delivering it to the people who live closest to the consequences. A promise that cannot move is not, in the end, a promise. It is a press release sharing false promises.

So here is where I am focused. We have to stop treating the intermediary layer as plumbing — invisible until it fails — and start building it as durable public infrastructure in its own right. That means community lenders capitalized in ways a single directive cannot freeze. It means benefit agreements with financing attached, and meaningful outcomes and accountability measures to match. It also means learning from the families who stopped waiting: build the capacity closest to the need, and make it hard to switch off.

Nine years. One quarter of the money. The people built the rest themselves. And I am willing to place my bets on the people. Are you?