With Puerto Rico facing a $2 billion debt payment in just over three weeks, lawmakers in the U.S. House of Representatives passed legislation on Thursday to ease the island’s crippling financial crisis, The Associated Press reported yesterday. The strong bipartisan vote was 297-127 for the legislation that would create a financial control board and allow restructuring of some of Puerto Rico's $70 billion debt. The measure heads to the Senate just three weeks before the territory must make a $2 billion payment. The bill had the strong support of President Obama, House Speaker Paul Ryan and Minority Leader Nancy Pelosi. The legislation would allow the seven-member control board to oversee negotiations with creditors and the courts over reducing some debt. It does not provide any taxpayer funds to reduce that debt. It would also require the territory to create a fiscal plan. Among other requirements, the plan would have to provide "adequate" funds for public pensions, which the government has underfunded by more than $40 billion.
For more news and analysis of Puerto Rico's debt crisis, be sure to visit ABI's "Puerto Rico in Distress" webpage.
