House Panel Leaders Urge Members to Vote for Puerto Rico Bill

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WASHINGTON – Leaders of the House Natural Resources Committee and Rep. Pedro Pierluisi on Tuesday night urged their colleagues to approve a bill to help debt-ridden Puerto Rico, even though they may not support certain provisions or worry the measure does not go far enough.

This bill, like the past two versions, seeks to balance competing interests by creating a strong oversight board that would have the power to require balanced budgets and fiscal plans, as well as the ability to file debt restructuring petitions on behalf of the commonwealth and its entities in a federal district court as a last resort if voluntary negotiations do not succeed.

"In my view, the choice is between this imperfect but indispensable bill and no bill at all. And no bill is the worst possible outcome for Puerto Rico," Pierluisi, the commonwealth's nonvoting representative in Congress, said in an opening statement before the committee's vote on H.R. 5278, called PROMESA, on Wednesday.

Committee members plan to offer some 21 amendments to the, including one, by Rep. Garret Graves, R-La., that would give the oversight board the power to investigate broker-dealers and investment advisers that may have failed to disclose or misrepresented the high risks of Puerto Rico bonds they sold to retail investors.

Pierluisi urged colleagues to vote for the bill after calling it "necessary, but not sufficient."

He said that accepting the bill's proposed oversight board to stabilize the commonwealth's economy and budgets was "personally painful" but that "intensive negotiations" and ultimate revisions made to the initial draft legislation has resulted in a board that will be "robust but reasonable."

He opposes the bill's provision to allow certain younger works to be paid less than the federal minimum wage while the oversight board is in existence, but said he doubts Puerto Rico will ever use this authority.

"It is not worth discarding the bill over this misguided, but ultimately meaningless, provision," he said.

Pierluisi told other committee members: "I respect those who have concerns with certain aspects of the bill, but I urge you to look at the bill holistically. If you do, I think you will agree that its pros vastly outweigh its cons."

Committee chairman Rob Bishop, R-Utah, said Congress has a constitutional duty to help Puerto Rico because of Article 4 of the U.S. Constitution, which gives U.S. lawmakers to write rules for the territory. PROMESA will fulfill that responsibility he said, adding, "The bill is Puerto Rico's last and best chance to get on sound financial footing and put its economy on the path to recovery and prosperity."

The committee's top Democrat, Raul Grijalva from Arizona, said "this is not the bill I would have drafted."

He said the oversight board is "too powerful" and "yet another encroachment on the sovereignty of the people of Puerto Rico." He also faulted the bill for not containing pension protections and an earned income tax credit, as well as funding for Medicaid and the fight against Zika.

"These shortcomings are disappointing," he said. But he added: "Here is the bottom line. Puerto Rico is drowning in debt and H.R. 5278 is a lifeline."

Rep. Don Young, R-Alaska, also said the bill "is not perfect," but "is essential."

Rep. Tom McClintock, R-Calif., opposed the bill's failure to protect Puerto Rico's constitutionally guaranteed debt. "There's every reason to believe" the bill will lead to the undermining of the debt of states backed by their full faith and credit, he said.

McClintock plans to offer an amendment on Wednesday that would pull the territory's constitutionally-backed debt from the bill's purview.

Other planned amendments include: one from Rep. John Fleming, R-La., to strike the bill's section providing an automatic temporary moratorium on litigation over the territory's debt; one from Rep. Norma Torres, D-Calif, to strike the measure's provisions on providing younger workers with less than the minimum wage; and one from Rep. Raul Labrador, R-Idaho, to provide for the payment of pension benefits projected to become due during the period covered by the territory's fiscal plan.

Rep. Tom MacArthur, R-N.J., has drafted two amendments that would revise the bill to give preference to the use of public-private partnerships if they would accelerate delivery of projects or lower costs. Rep. Jared Polis, D-Colo., plans to propose an amendment to strike provisions of the bill that exempt Puerto Rico from the Labor Department's rules relating to over-time.

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