Puerto Rico Debt News: Congress Omnibus Spending Bill Excludes Relief for Commonwealth

By Michael Oleaga (staff@latinpost.com)

The Puerto Rican flag flies as people protest outside of Wall Street against cutbacks and austerity measures forced onto the severely indebted island of Puerto Rico on December 2, 2015 in New York City. Puerto Rico made a $355 million payment on Tuesday on its bond debt to stave off a default. Officials have warned that the commonwealth's fiscal position remain dire. (Photo : Spencer Platt/Getty Images)

The Puerto Rican flag flies as people protest outside of Wall Street against cutbacks and austerity measures forced onto the severely indebted island of Puerto Rico on December 2, 2015 in New York City. Puerto Rico made a $355 million payment on Tuesday on its bond debt to stave off a default. Officials have warned that the commonwealth’s fiscal position remain dire. (Photo : Spencer Platt/Getty Images)

Despite pleas from Puerto Rican officials including its governor, Congress will likely not include any relief for the U.S. territory in the omnibus spending bill.

Speaker of the House Paul Ryan, R-Wisc., announced the upcoming omnibus spending bill will not include language that would address the commonwealth island’s economic issues.
“Puerto Rico’s fiscal crisis is a problem that is not going away anytime soon,” Ryan said in a statement his office released.

“While we could not agree to including precedent-setting changes to bankruptcy law in this omnibus spending bill, I understand that many members on both sides of the aisle remain committed to addressing the challenges facing the territory.”

Instead, Ryan has instructed certain House committees to develop a possible solution plan, and have it submitted by the end of 2016’s first quarter.
Resident Commissioner Pedro Pierluisi, who serves as Puerto Rico’s congressman — which has non-voting status, acknowledged that the current omnibus bill does not include a provision to grant Puerto Rico the same debt restructuring privilege as standard U.S. states. He said the blame should be on Republicans.
“This is disappointing because giving Puerto Rico state-like treatment under Chapter 9 does not cost American taxpayers a dollar, because numerous conservative individuals and organizations support this initiative, because the bill promotes the rule of law, and because I repeatedly expressed a willingness to be flexible and open to compromise on this issue,” said Pierluisi.
The Puerto Rico congressman said if members of Congress are making a “terrible miscalculation” if lawmakers have the belief that they are somehow helping Puerto Rico’s creditors by opposing efforts to grant the island the same debt reorganizing benefits.
“Make no mistake: We will keep fighting together for what is right and what is just. This battle is far from over,” Pierluisi said.
On Dec. 9, Puerto Rico Gov. Alejandro Garcia Padilla said the island doesn’t need a bailout but only “the tools to do the job.”
Following Garcia Padilla’s remarks, U.S. Rep. Luis Gutiérrez, D-Ill., said he would vote against the omnibus bill if financial help for Puerto Rico is not included. On Dec. 16, he reiterated his pledge to vote against the bill.
“I can’t vote for the omnibus deal because it does not give the people of Puerto Rico some hope for a better future. The omnibus bill does not provide a path towards budget cut and services, growing unemployment and the greedy banks and bond holders who demand more and more even as the people of Puerto Rico have less and less,” Gutierrez said during a bilingual House floor speech.
The omnibus bill does address one other important issue in Puerto Rico. As Pierluisi noted, the omnibus bill contains health-related language, including allowing Puerto Rican hospitals the same Medicare reimbursement rates as U.S. states and Washington, D.C., and eligible for further Medicare bonuses.

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