With the announcement that Puerto Rico will default on a portion of the nearly $1 billion in debt due to its bondholders, U.S. Sen. Richard Blumenthal is pushing for action on a bill he introduced last summer to protect the commonwealth.
The bill would grant Puerto Rico authority to allow its municipalities and public utilities to restructure their debts under the supervision of a bankruptcy court, authority which is already currently granted to all U.S. states.
“The announcement is just the latest reminder that Puerto Rico has neither the money to pay off its creditors nor access to an orderly process for restructuring its debt. Congress cannot continue to bury its head in the sand while 3.5 million U.S. citizens in Puerto Rico suffer – we must act now,” he said in a statement. The senator also said the default exposes Puerto Rico to messy, costly, and avoidable lawsuits.
