Majority Leader Mitch McConnell (R-Ky.) said that the Senate will consider a rescue package to ease Puerto Rico's financial crisis before the U.S. territory's $2 billion payment to creditors is due July 1, the Associated Press reported today. The House overwhelmingly passed legislation to create a new control board and restructure some of Puerto Rico's $70 billion debt last week.
Puerto Rico in Distress
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Yesterday, in Commonwealth of Puerto Rico v. Franklin California Tax-Free Trust, the U.S. Supreme Court took away the last existing option for Puerto Rico to restructure its debt, unless Congress steps in, according to a commentary by Prof. Charles Tabb of the University of Illinois College of Law.
Creditors for Puerto Rico’s main electricity provider are reviewing a proposal from the utility that would help the agency avoid a $420 million bond default on July 1, according to three people with direct knowledge of the plan, Bloomberg reported yesterday.
The U.S. Supreme Court ruled that Puerto Rico cannot adopt its own legislation to restructure its crushing debt burden because of a 1984 federal bankruptcy provision that bars the commonwealth from using chapter 9, The Washington Post reported yesterday.