Kilili seeks governor’s input in proposed amendment to US law

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U.S. Congressman Gregorio Kilili Camacho Sablan is requesting Gov. Ralph DLG Torres to comment on a draft bill that proposes to amend U.S. Public Law 114-187 — the Puerto Rico Oversight, Management and Economic Stability Act of 2016 or PROMESA.

Gregorio Kilili Camacho Sablan

The bill, for which the U.S. House Natural Resource Committee plans to hold a markup by the end of the month, aims to help address Puerto Rico’s disaster recovery challenges.

Section 9 of the draft bill would grant a territory that meets certain criteria the authority to discharge some of its unsecured financial obligations.

The bill, in addition, would allow a territory or its instrumentalities to discharge unsecured debt if it meets two of the following conditions: (1) a 5 percent decrease in population within a 10-year period, (2) having received major disaster within five years, and (3) having per capita debt greater than $15,000.

Kilili would like to know the governor’s position on Section 9 of the draft.

The unsecured financial obligation of a qualifying territory, Kilili said, would only be eligible for discharge once in a seven-year period, and only if agreed to by the governor and a majority of each house of the territory’s legislature, or if adopted by two-thirds of the members of each house of the territory’s legislature.

“I am seeking your input on this provision enabling a territory to cancel some of its unsecured financial obligations due to concerns of the potential effect on the Commonwealth’s ability to borrow and to sell bonds to raise funds if needed,” Kilili told the governor.

“If you decide that this provision would be helpful to the Commonwealth in the event we find ourselves in a situation similar to Puerto Rico, I will support its passage. However, if you find that this type of debt relief would do more harm than good, I will work to ensure that the Northern Mariana Islands is removed from the section of the bill prior to markup,” Kilili said.

He added that Section 401 of U.S. P.L. 114-187 ensures that nothing in the Act would affect the Covenant of the NMI with the U.S.

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