Puerto Rico's Resident Commissioner Says PROMESA Stay Extension is Unlikely

gonzalez-colon-jenniffer-357.jpg

Puerto Rico Resident Commissioner Jenniffer González Col-n said that an extension of the Puerto Rico Oversight, Management and Economic Stability Act debt litigation stay was unlikely.

In Gov. Ricardo Rossell-'s Feb. 28 proposed fiscal plan the governor said he was seeking the extension of the stay to Dec. 31 from May 1.

González Col-n, who is Puerto Rico's non-voting representative in the United States House of Representatives, said that Congress didn't have time to amend PROMESA before the end of the stay, her spokeswoman Marieli Padr- Raldiris said. González Col-n and Rossell- are members of Puerto Rico New Progressive Party and close allies.

PROMESA set the stay on debt-related suits against the commonwealth on Feb. 15 but allowed the Oversight Board the option of moving it to May 1, which it did on Jan. 28.

In Rossell-'s plan, he argued that it was reasonable to ask for an extension because the previous governor failed to use his time in office after PROMESA passage to seek a negotiated debt restructuring. He said the extension would allow his administration time to release fiscal year 2015 and 2016 financial information.

Rossell- said he would prefer reaching a negotiated agreement with creditors rather than having a court impose restructuring terms. PROMESA Title VI allows the board to reach negotiated solutions with bondholders while the stay is in effect.

In the governor's Feb. 28 proposed fiscal plan he said the board probably will start PROMESA Title III's court-supervised bankruptcy process before the stay elapses.

Groups representing holders of both general obligation and Puerto Rico Sales Tax Financing Corp. (COFINA) Senior bonds have said they are opposed to extending the litigation stay.

For reprint and licensing requests for this article, click here.
Puerto Rico
MORE FROM BOND BUYER