Puerto Rico turns to courts for debt protection

Puerto Rico turns to courts for debt protection

Puerto Rico turns to courts for debt protection

According to the US Census Bureau, 46 percent of Puerto Rico's residents live below federal poverty levels, compared to the national average of 14 percent and 36 percent in Detroit. Because Puerto Rico is an unincorporated territory, it's not eligible for Chapter 9 bankruptcy protection like other United States jurisdictions.

It set up a bankruptcy-like process tailor-made for Puerto Rico.

By contrast, Puerto Rico is struggling with a public debt burden totaling $74 billion of outstanding bonds and $49 billion owed for pensions.

A maze of government-issued bonds through various taxing authorities and revenue streams complicated attempts by Puerto Rico to settle with bondholders. Puerto Rico already faced about a dozen lawsuits before the litigation freeze was implemented as part of a rescue package that U.S. Congress approved a year ago.

Rossello said one of the lawsuits sought to claim all revenues generated by the island's Treasury Department for bondholders. While the USVI's overall tax-supported debt at $2 billion is much lower than Puerto Rico's $53 billion in tax-supported debt, per capita debt is about a third higher: $19,000 in the USVI compared with $12,000 for Puerto Rico.

Another concern is Puerto Rico's Medicaid program.

"It is my hope that the Government's Title III proceedings will accelerate the negotiation process", Rossello said.

"At least essential services would be guaranteed", he said. Unless negotiations result in a consensual.

Russia: Syrian safe zones plan to take effect at midnight
Aleppo, a former anti-government stronghold, had been under siege for months until it fell to Syrian forces in December. The UN has also been proactively supporting discussions in Astana regarding detainees and humanitarian demining.

Instead, the governor of Puerto Rico, Ricardo Rosselló, petitioned for relief under Title III of a new federal law for insolvent territorial governments, called Promesa. It would give Puerto Rico the legal ability to impose drastic discounts on creditor recoveries, but could also spook investors and prolong the island's lack of access to debt markets.

As businesses and people say goodbye to Puerto Rico, there's even less money to pay back creditors.

"Puerto Rico has been living on borrowed time", said Brad Setser, senior fellow at the Council on Foreign Relations.

Representatives for the Puerto Rican government and the oversight board had no immediate comment.

But "unlike Detroit, there isn't billions of unencumbered artwork to fund a restructuring" in Puerto Rico, said David Tawil, whose fund, Maglan Capital, held Puerto Rico general obligation debt but has since sold it. By comparison, the USA city of Detroit had $9.3 billion of obligations when it filed for bankruptcy in 2013 in the biggest US municipal bankruptcy ever.

Unlike states, Puerto Rico is not allowed to restructure its debt under Chapter 9 bankruptcy.

He also noted that that the government has to walk a fine line with bondholders amid negotiations.

"It's going to be uncomfortable for some", Barbarosh said. "Where that sweet spot is, nobody exactly knows". Bondholders rejected the offer. As of September 30, Puerto Rico and its various bond issuing authorities had missed almost $1.5 billion in debt service payments.

Recommended News

  • Reporters barred from China event for Kushner project

    Later, as investors started leaving the ballroom, organizers physically surrounded attendees to stop them from giving interviews . According to the Washington Post , Meyer's relationship with Kushner was included in promotional materials for the presentation.
    Friday morning Moneta tornado short-lived

    Friday morning Moneta tornado short-lived

    The tornado touched down just a few miles on the other side of the lake from Bridgewater Plaza. "It was loud - blew our roof off". Dennis Ivey with the York-Poquoson Sheriff's Office, also said no weather-related accidents had been reported in York County.
    Egyptian woman leaves Indian hospital more than 300 kg lighter

    Egyptian woman leaves Indian hospital more than 300 kg lighter

    Abd El Aty was put on a special liquid diet in India to reduce her weight enough so that doctors could perform bariatric surgery. The minister yesterday instructed officials to prepare a note in this regard so that it could be issued to all hospitals.
  • Conrad Hilton arrested in Hollywood Hills for allegedly violating restraining order

    Conrad Hilton arrested in Hollywood Hills for allegedly violating restraining order

    Olympic community, and devastating those who had known Holcomb for the entirety of his two-decade career in sliding. He was arrested in June 2015 for violating the restraining order, after police found him inside Daily's home.

    Concussed Crosby skates with Penguins, no word on return

    Ovechkin had two shots on goal, four shot attempts and tied for the game-high with six hits, but he knew it wasn't almost enough. Head coach Barry Trotz said much of the same in his postgame comments . "Now our backs are against the wall", Trotz said.

    White House dismisses chief usher, 1st woman to hold post

    Angela Reid was the first woman and the second African American to hold the prestigious position of White House Chief Usher. Angella Reid is photographed in Lafayette Park in front of the White House, Tuesday, Oct. 18, 2011, in Washington.
  • MTV celebrates summer viewing season with Movie & TV Awards

    MTV celebrates summer viewing season with Movie & TV Awards

    The cast of the " Fast and Furious " franchise were scheduled to receive the Generation Award, which Vin Diesel was set to accept. As the caption "Adam Gets It" flashed on the screen, Devine declared, "I love Hugh Jackman, but I call him Hugh Jack-PERSON".

    Wizards' Oubre suspended for Game 4 for knocking over Olynyk

    Be proactive - Use the "Flag as Inappropriate" link at the upper right corner of each comment to let us know of abusive posts. Unfortunately, you will be needing an authentication with your cable provider should you want to watch Boston Celtics vs.

    Oil drops as OPEC loses control of narrative

    The decline is being driven by expanding U.S. output before OPEC is set to decide whether to prolong its cuts. Stockpiles still stand at a near-record 527.8 million barrels and well above the five-year range.
  • Mehbooba invokes Vajpayee, says only Modi can find solution to Kashmir problem

    Mehbooba invokes Vajpayee, says only Modi can find solution to Kashmir problem

    She said, any decision by Prime Minister regarding Kashmir would be acceptable to the whole nation. These were not small developments.
    India board agree to Champions Trophy participation

    India board agree to Champions Trophy participation

    He is believed to be peeved over the women's team selection meeting being convened without his knowledge by BCCI CEO Rahul Johri. Even though Srinivasan was earlier keen on a pullout, he refrained from speaking about it after gauging the general mood.
    Green shows range, leads Warriors past Jazz for 2-0 lead

    Green shows range, leads Warriors past Jazz for 2-0 lead

    But after the game, he said the knee just "locked up" a bit - something he said he dealt with before. "I had it before". Which they did, in the third quarter! The Utah Jazz has failed to get a lead in 96 minutes against the Warriors .

We are pleased to provide this opportunity to share information, experiences and observations about what's in the news.
Some of the comments may be reprinted elsewhere in the site or in the newspaper.
Thank you for taking the time to offer your thoughts.