More than two years ago, Puerto Rico's government was at a fiscal standstill as lawmakers battled during a partial government shutdown over how to tackle budget shortfalls and rising debt levels. Emerging from that financial crisis required changes - zero-growth budgets and spending cuts, a first-ever 7% sales tax, increased water and energy fees, and less general obligation borrowing.

Yet a recession on the island that has lasted more than two years, along with the softening U.S. economy, have created a $1 billion deficit for fiscal 2009, which began July 1. The island's current governor, Anibal Acevedo Vila, recently talked with The Bond Buyer about his plans to close that gap and address other financial issues if voters on Nov. 4 re-elect the Popular Democratic Party leader for a second term.

Subscribe Now

Independent and authoritative analysis and perspective for the bond buying industry.

14-Day Free Trial

No credit card required. Complete access to articles, breaking news and industry data.