BY ELECTRONIC MAIL

February 7, 2024

Dr. Edwin González Montalvo

Executive Director
Puerto Rico Highways and Transportation Authority

Dear Dr. González Montalvo:

We are writing regarding the ongoing non-compliance of the Puerto Rico Highways and
Transportation Authority (“HTA”) with respect to certain provisions of the enforcement language
included in the Second Revised Fiscal Year 2024 Budget for HTA that was certified as of
December 8, 2023 (the “Second Revised FY2024 HTA Budget”).

Section VII of the Second Revised FY2024 HTA Budget relates to the funds held under the
General Reserve Fund and any other existing reserves established pursuant to the HTA Plan of
Adjustment and the New HTA Bonds Indenture 1 (collectively, the “PoA Accounts”) released from
the custody of Bank of New York Mellon (“BONY”) and transferred to HTA following the
redemption of its outstanding debt on December 14, 2023, pursuant to the Concession Agreement
between HTA and Puerto Rico TollRoads LLC (the “P3 Transaction”). Section VII requires HTA
to provide written notice to the Oversight Board within ten (10) days of the specific amounts being
made available to HTA along with a proposed plan for potential uses. In addition, Section VII
requires written authorization from the Oversight Board prior to any expenditure or use of these
funds.

Pursuant to Section 104(c) of the Puerto Rico Oversight, Management and Economic Stability Act
(“PROMESA”), the Oversight Board requests the following information regarding the HTA Plan
of Adjustment funds (the “POA Funds”) and any related accounts in which PoA Funds have been
deposited at any time:

1
Based on the Master Trust Agreement between HTA and BONY.
Dr. González Montalvo
February 7, 2024
Page 2 of 2

1. Amount Released: HTA must provide written confirmation of the final amounts that were
released and transferred to HTA from each of the existing PoA Accounts at BONY upon
redemption of its outstanding debt, including the disclosure of any fees levied by the
custodian entities and any applicable encumbrances. In addition, HTA must explain the
steps it will take to ensure that the proceeds of the P3 Transaction, the established reserves
therein, and the funds received from the PoA Accounts are segregated promptly to comply
with the provisions of the Second Revised FY2024 HTA Budget.
2. Utilization of Funds: HTA must provide (i) a comprehensive breakdown of any expenses
already incurred and covered with PoA Funds, (ii) an updated remaining balance of the
PoA Funds, (iii) details regarding pending or future expenses anticipated to be covered
with the PoA Funds and (iv) provide monthly reports detailing expenditures, receipts
(sources), and interest income generated from each of the POA accounts.

While HTA complied with certain other affirmative obligations under the Second Revised FY2024
HTA Budget, such as the written notice requirement in Section V, HTA failed to provide the notice
and the proposed plan for potential uses as required under Section VII. As such, the Oversight
Board requested follow-up information under Section VI (including confirmation of the amount
of P3 Transaction proceeds, if any, used to replenish the emergency and unforeseen events reserve)
and Section VII. In response, HTA informed the Oversight Board that, to maximize interest
income, the funds made available to HTA pursuant to Sections VI and VII were transferred into
the same account used to deposit the proceeds from the P3 Transaction. While the Oversight Board
supports the rationale behind depositing the funds into such account, HTA’s response did not
comply with the requirements set forth under Section VII of the Second Revised FY2024 HTA
Budget.

As observed in the HTA Cash Balance Report as of December 29, 2023, submitted to the Oversight
Board on January 12, 2024, approximately $101,439,456 under the PoA Accounts were made
available to HTA Subsequently HTA confirmed that these PoA Funds are being used for various
purposes, including maintaining HTA’s liquidity and covering toll optimization expenses. These
expenditures and uses were made, and continue to be made, without the prior written authorization
of the Oversight Board as required by Section VII of the Second Revised FY2024 HTA Budget.

We trust that you recognize the significance of the requests made herein and appreciate your
prompt attention to this matter. The Oversight Board looks forward to continuing working with
you to accomplish the requirements and goals of PROMESA for the benefit of the people of Puerto
Rico.

Sincerely,

Robert F. Mujica Jr.

Executive Director
Dr. González Montalvo
February 7, 2024
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CC: Hon. Omar J. Marrero Díaz

HTA Governing Board
Hon. Nelson Pérez Méndez