Puerto Rico Plan has less money available for debt near-term
The fiscal plan the Puerto Rico Oversight Board plans to approve today has less money for paying debt in the next six fiscal years and more in the following 24 fiscal years, than the current certified fiscal plan.
Board Executive Director Natalie Jaresko said the plan anticipates a central government surplus of $13.6 billion through fiscal year 2024.
While the bondholder community has hoped that this money would be used just for paying debt, the board has said it will also be used for capital spending. It has also said that debt payments won’t be based on the surplus but instead on the 50 states’ debt metrics.
Jaresko said she expected the board to approve the proposed fiscal plan, was slated to be posted to the board's web site overnight.
The plan anticipates a $19.7 billion surplus through fiscal year 2049, which Jaresko said was more than the current plan anticipates.
Jaresko said the plan includes a 10% cut in spending on the government’s primary pension system, as did earlier versions of the fiscal plan.
Full story to follow.