Top Republican and Democratic House leadership staff are gathering with policy aides and Treasury Department officials to talk over next steps on the stalled Puerto Rico rescue bill, Politico reported today. The Hill meeting between the Obama Administration, House Natural Resources Committee and leadership staffers comes just days after a legislative package aimed at saving the Caribbean island from defaulting on its debt imploded because of conservative misgivings. The right flank of the House conservative conference has been spooked by the bill, after lobbying efforts and ads from creditors have labeled the bill a bailout — though it actually uses no taxpayer money. The bill’s backers say they’re going back to the drawing board to change the legislation to garner more support. Members of the Congressional Hispanic Caucus also plan to ask House Speaker Paul Ryan (R-Wis.) about the matter at a sit-down they previously had scheduled, in the hopes that Ryan will move quickly. Read more.
In related news, Puerto Rico’s Government Development Bank (GDB), operating under a state of emergency imposed to halt an erosion of its dwindling cash, has filed with regulators to sell debt as officials negotiate with creditors about a $422 million payment owed at the start of May, Bloomberg News reported yesterday. The GDB, which lent to the commonwealth and its agencies, filed to sell taxable securities that would mature May 2017, according to the Municipal Securities Rulemaking Board’s website, called EMMA. The notice doesn’t list the amount of the sale or the coupon. The commonwealth hasn’t been able to sell debt since last year. Governor Alejandro Garcia Padilla declared the state of emergency April 9, allowing withdrawals from the GDB only to fund health, public safety and education services. The bank has $562 million of liquidity, according to a debt-moratorium law passed two weeks ago. Read more.
For more news and analysis of Puerto Rico's debt crisis, be sure to visit ABI's "Puerto Rico in Distress" webpage.
