P.R. Laws tit. 21, § 4816
(a) The municipalities may be a part of, participate promote, and sponsor nonprofit corporations organized under §§ 3501 et seq. of Title 14, for the purpose of promoting the economic and cultural development or the social improvement of a municipality or the region of which it is a part, provided that:
(1) The corporation is organized through the efforts, participation and commitment of the municipality in addition to that of the entities and organizations of the following sectors:
(A) Higher education entities (accredited by the applicable laws), and
(B) private commercial and industrial enterprises and/or associations that group industries or businesses, such as the Puerto Rico Manufacturer’s Association and the Puerto Rico Chamber of Commerce;
(2) that the corporation obtains a tax exemption from the Department of the Treasury under Section 1101 of Act No. 120 of October 31, 1994, known as the Internal Revenue Code of 1994, and
(3) the entities that participate in the corporation sign an agreement to contribute that identifies and specifies the nature and amount of the contributions and the obligations of the participants. This contribution agreement shall be notarized by a lawyer licensed to practice the profession in Puerto Rico. Said agreement shall be available in the municipalities that sign it and shall be filed at the Office of the Controller of Puerto Rico no later than thirty (30) days after its signing.
(b) Every nonprofit corporation organized under §§ 3501 et seq. of Title 14, pursuant to the criteria established in subsection (a) of this section may choose to establish, or not, a membership system pursuant to the norms provided in their corporate documents. In the event that the corporation chooses a system of membership, the municipality or municipalities that participate therein may appoint up to one third (1 / 3) of its members.
(c) The municipality or municipalities that participate in this nonprofit corporation shall have participation in the Board of Directors, with voice and vote of the mayor and the municipal officials who are authorized to be part of it through a resolution approved by two thirds (2 / 3) of the members of the Municipal Legislature. The participation of the municipality or municipalities on the Board of Directors of this corporation shall not exceed one third (1 / 3) of the members that compose it. The nonprofit corporation may contract services and works with the entities that compose it, provided that the majority of the uninvolved members of the Board of Directors, approves said contracting (even though they do not constitute quorum) and the directors designated by these entities to the Board of Directors do not participate in said decision-making process (even though they are counted for the effect of the quorum).
(d) With the exception of the mayors and/or municipal officials who are members of the Board of Directors, the Directors of the Board shall not be considered employees or officials of the Commonwealth. The nonprofit corporation organized pursuant to this section shall have juridical existence and personality separate from the participating municipality or municipalities and shall not be subject to the provisions regarding the special municipal corporation authorized by § 4801 of this title.
(e) The operations of this nonprofit corporation shall be subject to auditing by the Office of the Comptroller of Puerto Rico.
History —Aug. 30, 1991, No. 81, added as § 17.016 on Aug. 9, 2002, No. 137, § 2.