Congressional Leaders Issue Statement on Chapter 9 and Puerto Rico

House Judiciary Committee Chairman Bob Goodlatte (R-VA) and Subcommittee on Regulatory Reform, Commercial and Antitrust Law Chairman Tom Marino (R-PA) issued the following statement on Puerto Rico’s economic situation and fiscal crisis:

“Today, we met with our Republican colleagues on the Judiciary Committee to discuss the issues facing Puerto Rico. While no consensus was reached, a general concern was expressed that to provide Puerto Rico’s municipalities access to chapter 9 of the Bankruptcy Code would not, by itself, solve Puerto Rico’s difficulties, which are associated with underlying, structural economic problems. These problems need to be addressed and we continue to monitor the developments in Puerto Rico and are actively assessing the merits of any potential congressional response.”

The Judiciary Committee held a hearing in February to consider legislation providing Puerto Rico’s municipalities access to chapter 9 of the Bankruptcy Code.

Puerto Rico Resident Commissioner Pedro Pierluisi responded by stating, “I have never argued that authorizing Puerto Rico to permit its public corporations to seek relief under Chapter 9 would solve all of Puerto Rico’s economic problems.  But it would provide Puerto Rico with an important tool that all the states have, and at no cost to federal taxpayers.”

“I agree with Chairman Goodlatte and Chairman Marino that Puerto Rico’s economic problems are structural in nature and require structural solutions,” Pierluisi added.  “The most effective way in which Congress could help address these structural problems is by providing more equitable treatment to Puerto Rico under the various federal spending and tax credit programs that currently discriminate against the territory.  In the meantime, it is my hope that the Judiciary Committee—which has jurisdiction over bankruptcy issues—will see fit to advance H.R. 870.”

At a briefing today, White House press secretary Josh Earnest was asked about the legislative initiative pending before Congress.  “We have been for the better part of a week-and-a-half here been suggesting that this is something that Congress should take a careful look at,” Earnest responded.  “We’d be willing to work with them on it because it would ensure that Puerto Rico would have access to some greater tools to deal with some of the financial challenges that they’re experiencing right now.”

Amended at 9:26 to include Pierluisi response and report of White House briefing

3 Comments

Chris

Once again the colonial propaganda pamphlet also known as “El Nuevo Dia” is outright lying by claiming that Goodlatte rejected the bill.

They seem to not understand the meaning of “While no consensus was reached”. It seems that some members of the committee want to further review the bill – which is perfectly fine. Nowhere has it been stated that the bill has been rejected. El Nuevo Dia needs to stop lying and misstating what members of Congress say.

Chris

From Congressman Tom Marino:
““Puerto Rico must make serious, timely and demonstrable steps towards righting its fiscal ship before anything moves legislatively. It should also be abundantly clear that we are not discussing a bailout or even the specifics of what Chapter 9 bankruptcy may look like for Puerto Rican municipalities. We are going to continue our diligent examination of including Puerto Rico in Chapter 9 bankruptcy, including any potential economic impacts on bondholders in the U.S. as well as the larger municipal bond market. Puerto Rico’s problems did not occur overnight and neither will a solution, especially from Washington.””
Totally different from what El Nuevo Dia is claiming.

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