The Puerto Rico Oversight Board intends to submit a plan of adjustment for the island's central government debt by the end of this month, outlining the level of repayment for as much as $19 billion of bonds that have been in bankruptcy since 2017.
Board attorney Martin Bienenstock told bankruptcy Judge Laura Taylor Swain at Wednesday’s omnibus hearing that the plan would soon be submitted.
In mid-March Bienenstock said the plan might be submitted by the end of April.
The parties to the debt of central government debt and other Puerto Rico entities are now or are soon to be involved in mediation. It is unclear how the terms of the plan of adjustment will affect the mediation discussion.
At Wednesday’s hearing Unsecured Creditors Committee attorney Luc Despins said his clients would object to the approval of a settlement of bond claims before there was a settlement of other non-bond-related claims against the central government. Despins said his clients were those holding non-bond-related claims.
On other topics, Bienenstock said that board Executive Director Natalie Jaresko and board Chairman José Carríon had held several meetings with Wanda Vázquez since she became governor on Aug. 7. They have discussed several issues on which the board disagreed with former Governor Ricardo Rosselló.
Progress has been made on breaching these differences, Bienenstock and Puerto Rico Fiscal Agency and Financial Advisory Authority lawyer John Rapisardi said. FAFAA serves under Vázquez.
Rapisardi said that Vázquez is also seeking additional aid from the federal government. He mentioned that she is in Washington, D.C., this week. Regarding this and the governor’s discussions with the board, he said, “I think things are moving quite well on all fronts.”
In other news from the hearing, Despins indicated that there was some progress in Employees Retirement System bond mediation. He said that the parties were nearing agreement on a supplementary procedures motion to be filed. The parties told him to ask Swain to lift the stay in the case so that he can submit the motion.
As of February 2017 there were $3.2 billion in ERS bonds outstanding.
Bienenstock said that there would soon be a Title VI filing for the Puerto Rico Industrial Development Company bonds. FAFAA is handling the negotiations. Title VI of the Puerto Rico Oversight, Management, and Economic Stability Act governs an approach to negotiated bond deals.
PRIDCO had $156 million of bond debt outstanding as of February 2017.
