The Puerto Rico Oversight Board gave extensions to Puerto Rico’s government and public authorities for fiscal plan submissions.
The government, Puerto Rico Electric Power Authority, and Puerto Rico Aqueduct and Sewer Authority now must submit the plans by Jan. 10 instead of Dec. 22, the Board said on its website.
A board-certified fiscal plan for the government provided for the payment of 24% of the amounts due on bonds during the next nine years, as part of the restructuring of more than $50 billion of public sector bond debt.
On Oct. 31 the board ordered the submission of revised fiscal plans that took into account Hurricane Maria’s impact on finances, and set the Dec. 22 deadline.
In general, the fiscal plans set out guidelines for several years of tax and spending plans and revenue expectations. The board has indicated that the plans will require the restructuring of the entities’ long-term debts.
The plan for the Public Corporation for the Supervision and Insurance of Cooperatives (COSSEC) is an exception in that COSSEC itself has no bond debt. However, its member financial cooperatives’ investment in public sector bonds and the prolonged economic decline have left the sector vulnerable, thus attracting the board’s attention.
In the week of Dec. 11 Gov. Ricardo Rosselló requested extensions for the plans. On Wednesday the board granted the extensions. Consistent with the Puerto Rico Oversight, Management, and Economic Stability Act, it also said it planned to certify the central government, PREPA, and PRASA fiscal plans on Feb. 23.
The board also announced an extension of the due date for the plans for the University of Puerto Rico, Highways and Transportation Administration, Government Development Bank for Puerto Rico, and the Public Corporation for the Supervision and Insurance of Cooperatives (COSSEC) to March 9 from Feb. 9. It is extending the planned certification to April 20 from March 16.
Representatives in Puerto Rico's legislature were quoted last week in El Vocero complaining that the Dec. 22 deadline was too early, given the government's focus on hurricane recovery and the uncertainty over the U.S. tax overhaul.