Removing Barriers Blog

Puerto Rico Bill Passes House Committee
Posted May 25, 2016 by CUNA Advocacy

The House Natural Resources Committee, by a vote of 29-10, today passed the Puerto Rico Oversight, Management, and Economic Stability Act (PROMESA).  Puerto Rico currently has over $70 billion of debt and over $40 billion in unfunded pension liability that the territory cannot repay.  However, because the island is a U.S. territory, it cannot declare bankruptcy without the permission of the U.S. Congress.

The PROMESA Act would create an Oversight Board to review Puerto Rico’s budgets, require the territory to produce audited financial statements, attempt in good faith to reach consent between Puerto Rico and its creditors, create a task force on economic growth, and authorize the island to pay workers less than the federal minimum wage. 

The lead author of PROMESA, Congressman Sean Duffy (R-WI) stated, “Years of disastrous policies have completely wrecked Puerto Rico’s economy.  As a result, the island and its millions of American citizens face a humanitarian crisis.  That’s why we must allow for a responsible restricting for Puerto Rico’s debt…”  The bill was cosponsored by Rob Bishop (R-UT), the chair of the Natural Resources Committee, which has jurisdiction over the issue; as well as Jim Sensenbrenner (R-WI).