Puerto Rico’s governor announced yesterday that a federal control board reached a key deal that would reduce the U.S. territory’s overall debt by nearly 80%, but that his administration is rejecting it amid concerns about cuts to the island’s crumbling public pension system, the Associated Press reported.
Puerto Rico in Distress
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Puerto Rico moved closer to resolving the largest municipal-debt default in U.S. history after creditors owed roughly $11.7 billion backed a settlement framework, the most Wall Street support yet amassed for a restructuring of the territory’s core public debts, the Wall Street Journal reported.
Puerto Rico’s financial oversight board reached a tentative agreement with investors on how to reduce $18 billion of bond debt and is seeking additional time to file a formal adjustment plan to the court, Bloomberg News reported.
Puerto Rico yesterday presented a budget proposal of $10.7 billion for fiscal year 2022 — about $700 million more than the federally-appointed oversight board is recommending, Bloomberg News reported. Governor Pedro Pierluisi called his spending plan “realistic” and necessary to jump-start the economy of the bankrupt U.S. territory.
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The Financial Oversight and Management Board for Puerto Rico was created under the Puerto Rico Oversight, Management and Economic Stability Act of 2016. The Board consists of seven members appointed by the President of the United States and one ex officio member designated by the Governor of Puerto Rico. Access information on the Board, documents, videos of meetings, calendar of events and live webcasts by clicking here.