PROMESA

Puerto Rico's financial oversight board is seeking to reopen a confirmation hearing on a debt-restructuring plan for the island's power utility after an appeals court last week ruled that bondholders have a claim to the agency's future net revenue.

Observers and participants said the ruling sends a message that the municipal revenue bond pledge is strong and the Oversight Board's plan of adjustment for PREPA as it currently is proposed is unlikely to be able to stand.

Oversight Board Executive Director Robert Mujica said the only recently released fiscal 2022 ACFR showed revenues and expenditures continue to be imbalanced.

Judges say PREPA bondholders have a lien on net revenues collected post-bankruptcy.

The bond parties opposed to the plan of adjustment have already argued the Puerto Rico Oversight Board's electricity projections are too pessimistic, Judge Swain said.

Argument continues over how much PREPA will be able to pay bondholders.

Syncora and GoldenTree Asset Management want an accounting of what happened to PREPA net revenues.

The Oversight Board has given the local government until Tuesday to introduce a bill to revoke or amend a law that would reduce the Puerto Rico Electric Power Authority's revenues.

In the last few weeks projections from LUMA Energy indicate the authority can afford to pay more bond debt, opposing bond parties say.

The extension of the current solar net metering system could lower revenue for the utility.