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Puerto Rico’s bankrupt power utility reached a tentative agreement with a “substantial number” of its bondholders, according to a federal oversight board, and received another week to finalize a potential deal to reduce nearly $9 billion of debt, Bloomberg News reported. U.S. District Court Judge Laura Taylor Swain on Thursday granted a request by the federally appointed board to postpone to Aug. 18 a deadline to file an amended debt-cutting plan. The board, which manages the bankruptcy, and some bondholders are working on the specific terms of a restructuring support agreement, according to the board’s motion seeking an extension. A potential debt deal between Puerto Rico’s Electric Power Authority, called Prepa, and its creditors would be a long-awaited and positive development in the utility’s six-year bankruptcy, which has been prolonged by hurricanes, the commonwealth’s own debt restructuring and the pandemic. “The oversight board is pleased to report it has reached an agreement in principle with a substantial number of holders of Prepa bonds to settle their respective claims against Prepa,” lawyers for the board wrote in Thursday’s court filing.

The judge overseeing the bankruptcy of Puerto Rico’s power utility granted it an additional week — for the second time in the past 10 days — to reach a deal with bondholders as talks are progressing, Bloomberg News reported. The island’s federally appointed financial oversight board, which is managing the utility’s bankruptcy, sought more time to negotiate with bondholders as it anticipates reaching an agreement with at least one creditor, a lawyer for the board said in a court document filed Thursday. U.S. District Court Judge Laura Taylor Swain agreed to the board’s request to push out the deadline to file an amended debt-restructuring proposal to Aug. 11. The board had made a similar request last week, and had been allowed to postpone an original July 28 deadline to Aug. 4. The board “continues to believe the prospects of at least one major settlement is high and possibly two major settlements are sufficient to avoid filing an amended plan this week,” a lawyer for the board wrote in the request for more time. The Puerto Rico Electric Power Authority, called Prepa, has been in bankruptcy for six years and is seeking to reduce nearly $9 billion, the commonwealth’s last remaining sizable debt restructuring. Resolving the utility’s obligations will help stabilize electricity costs on the island and allow officials to focus on modernizing its power grid. Negotiations between the board and Prepa’s bondholders increased after Swain in June capped at $2.38 billion the amount of utility net revenue that bondholders have a claim to.

U.S. prosecutors and IRS agents are deploying undercover agents and closely examining records to build criminal and civil cases against wealthy individuals suspected of illegally taking advantage of tax breaks offered by Puerto Rico, Bloomberg News reported. The cash-strapped island used eye-popping incentives to lure hedge fund managers, cryptocurrency traders and other Americans to the U.S. territory over the last decade. But investigators are now focusing on whether people lied about how much time they spend on the island and the source of their income. U.S. officials are also looking at the promoters, attorneys and accountants who marketed the tax program, one of the people familiar with the probes said. At least two criminal investigations, including one involving a U.S. lawyer, could result in charges soon, said the people, who asked not to be identified because the probes aren’t public. Prosecutors are weighing conspiracy and wire fraud charges, according to a speaker at a New York conference last month who recounted a phone call with a federal prosecutor who had been to San Juan.

A federal control board that oversees Puerto Rico’s finances on Friday approved a $12.7 billion general fund budget that contains increases for teachers, judicial employees and the U.S. territory’s public university, the Associated Press reported. It is the largest budget approved in the island’s history. The bulk of the funds, $2.6 billion, will go toward education, followed by $1.2 billion for public safety, $600 million for the University of Puerto Rico and $555 million for the island’s health department. The approval comes after last-minute debates threatened to derail the proposed budget, which is slightly bigger than last year’s $12.4 billion budget. The new budget was previously approved by Puerto Rico’s legislature and governor on Thursday and went into effect on July 1.

Puerto Rico’s financial oversight board is considering slashing — by about half — the amount of new bonds it claims the island’s bankrupt power utility can repay, a potential offering that bondholders will most likely reject, Bloomberg News reported. The federally appointed board calculates that Puerto Rico’s Electric Power Authority, called Prepa, can only repay $2.5 billion to its creditors, less than half the $5.68 billion offered in its March debt-restructuring plan. It’s far below the $10 billion it owes, including nearly $9 billion to bondholders and fuel-line lenders. Steeper-than-anticipated declines in energy consumption and rising costs require a larger-than-previously proposed cut to the amount of debt the utility is able to repay over time, the board, which is managing Prepa’s bankruptcy, said in a statement late Friday after it approved the utility’s multi-year fiscal plan. “The guiding principle for all debt restructurings is sustainability,” David Skeel, the board’s chairman, said in the statement. “The goal is to stabilize Prepa. The oversight board has been analyzing carefully and dispassionately how much debt Prepa can pay and made that determination strictly based on the most recent available data.”

Puerto Rico’s financial oversight board is amending its plan to reduce $9 billion of Electric Power Authority debt to reflect steeper-than-expected declines in energy consumption, Bloomberg News reported. The federally appointed oversight board notified the court of its intent to alter the restructuring plan after receiving new data from Prepa, as the utility’s known, and Luma Energy, which operates the power grid, according to a document filed Saturday with the court. The debt plan would cut Prepa’s obligations down to $5.68 billion. The changes may delay a scheduled confirmation hearing next month on the restructuring plan. It also signals the oversight board may reduce its $5.68 billion proposal of new utility debt, an amount that bondholders have already said is too low. Prepa has been in bankruptcy for almost six years and is the main supplier of electricity on the island. New data show that energy consumption is declining more than anticipated, Martin Bienenstock, a lawyer for the oversight board, said earlier this month during a court hearing. The board and its financial advisers are reviewing “whether the new load information changes projections for the future that would impact debt sustainability,” Bienenstock said during the hearing.

Barely a year out of bankruptcy, Puerto Rico’s top officials are descending on Wall Street in an attempt to convince global investors that the Caribbean island — long battered by hurricanes and fiscal mismanagement — is open for business, Bloomberg News reported. Hundreds of bankers, investors and developers are expected to gather in downtown Manhattan on Thursday and Friday for a conference, dubbed PRNOW. Attendees will schmooze with officials — including Puerto Rico’s Governor Pedro Pierluisi and New York Governor Kathy Hochul — at Cipriani Wall Street, the former home of the New York Stock Exchange and a Manhattan landmark that boasts sweeping Greek revival architecture and 70-foot-high ceilings. The conference will reacquaint Wall Street’s institutional investors with Puerto Rico and allow the territory — now flush with federal reconstruction money — to flaunt its recent achievements, including upswings in tax revenue, economic activity, tourism and employment. Those successes were hard won after the island in 2017 began the largest municipal bankruptcy in U.S. history just as it was hit by Hurricane Maria, one of the most destructive storms to ever touch U.S. soil. A federally appointed oversight board has been controlling Puerto Rico’s finances since 2016.

The Supreme Court ruled on Thursday against an organization of Puerto Rican journalists in its quest for documents from the financial oversight board created to deal with the island territory's bankruptcy, the Associated Press reported. The justices by an 8-1 vote reversed an appeals court ruling in favor of the Centro de Periodismo Investigativo, which has reported extensively on Puerto Rico's fiscal crisis and debt restructuring. In 2016, Congress passed a law that created the control board that continues to oversee Puerto Rico's finances. The reporters' group is seeking an array of documents, including communications between the board's members and U.S. and Puerto Rican officials. The board contends it is a part of the government of Puerto Rico and enjoys the same shield from federal lawsuits as the government. But the Boston-based First U.S. Circuit Court of Appeals, which includes Puerto Rico, ruled that the 2016 law, known as PROMESA, eliminated the immunity from lawsuits, and allowed the claims of the reporters' group to proceed. Writing for the court, Justice Elena Kagan said Congress has to speak clearly on this subject, and nothing in PROMESA makes clear “that Congress deprived the board of sovereign immunity.”