“There remain extraneous provisions in the bill, such as those regarding labor standards, which will not help address Puerto Rico’s debt crisis”, Lew said.
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“I am encouraged that this legislation puts us one step closer to providing Puerto Rico with a fair and workable path out of its current situation – an ongoing catastrophe that Congress can not tolerate in any part of the United States”, Blumenthal said.
“I am pleased that the conveyance of the Vieques National Wildlife Refuge has been removed from the bill, thanks to the support of my fellow Democrats, many conservation-minded groups in Puerto Rico, and other organization that rallied together to oppose this provision”, he added.
“Chairman Bishop and Speaker Ryan should be commended for advancing revised legislation that will aid the Puerto Rican people, honor creditors” legal rights and safeguard US taxpayers against funding a bailout.
Puerto Rico’s next debt payment of $1.9 billion, which its governor has said it can not pay, is due on July 1.
The bill must still pass the House and be sent to the Senate for action.
A vote by the U.S. House of Representatives on the bill is now expected to take place in the first week of June, ahead of a looming $1.9 billion debt payment due on July 1.
Treasury Secretary Jack Lew in a statement said the “restructuring tools” were “comprehensive and workable”.
Eric LeCompte, executive director of Jubilee USA, a religious anti-poverty group and proponent of restructuring Puerto Rico’s debt, strongly endorsed the bill while acknowledging it is not “perfect”.
With almost all other details ironed out, disagreements had remained over how to handle appointments to a seven-member board created to oversee the island’s finances.
“Otherwise, without any means of addressing this crisis, too many Puerto Ricans will continue to suffer”, she said.
The bill boosts the board’s power to force the sale of government assets and consolidate agencies and workforce.
“Majority Leader [Mitch] McConnell (R-Ky.) and Speaker [Paul] Ryan (R-Wis.) would be in charge of handpicking a majority of the control board’s members, while the people of Puerto Rico would be in charge of choosing none”, he said.
The U.S. government will not pledge its full faith and credit for repaying Puerto Rico’s debt.
“After long bipartisan negotiations, we believe we have achieved a restructuring process that can work”, U.S. House Democratic Leader Nancy Pelosi said in a statement on Thursday.
“Right now, the stability of the US territory is in danger, as the Puerto Rican government continues to default on major loan payments”, House Speaker Paul Ryansaid in a statement.
The bill calls for the creation of a seven-member control board appointed by Congress and the president that would oversee some court-ordered debt restructurings. The bill lacks any clarity with regard to preventing the Control Board from retroactively subordinating Puerto Rico’s bondholders to the Commonwealth’s government pensions.
There are three fundamental tasks involved in the complex and massive problems, and the bill addresses all three.
Puerto Rico has been mired in economic stagnation for a decade, and more than 200,000 people have left Puerto Rico in the past five years, reducing the island’s tax base.
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Mrs. Pelosi said she wanted provisions that could lower the island’s minimum wage or change overtime rules to be removed, yet “these provisions are less harmful than originally proposed”.
