The Puerto Rico Electric Power Authority has officially filed for a form of bankruptcy protection.
The Puerto Rico Fiscal Agency and Financial Advisory Authority said Sunday that PREPA submitted a petition in the United States District Court of Puerto Rico under the Puerto Rico Oversight, Management, and Economic Stability Act of 2016. PREPA, which provides electrical service to nearly all of Puerto Rico, is saddled with $9 billion of debt.
“I believe that the Title III filing will provide PREPA the tools necessary to assure its uninterrupted operation and achieve a successful restructuring,” Gerardo Portela Franco, executive director of FAFAA, said in a statement.
The Puerto Rico Oversight Board had approved sending PREPA into Title III bankruptcy process Friday while also giving the go-ahead to a consolidated budget that includes $913 million of debt service for the 2018 fiscal year. PREPA officials said Sunday that the island’s utility plans to continue pursing financial and operational restructuring within the Title III case. It does not expect the filing to affect owed payments or electric supply.
“PREPA will operate in the ordinary course and the PREPA Title III case will not impact its ability to continue to provide uninterrupted service to customers or to meet its current obligations to employees and other essential vendors,” Ricardo L. Ramos, PREPA’s executive director, said in a statement.