Given the statement by the Financial Oversight and Management Board (FOMB) against the changes made by the Senate of Puerto Rico to the Bill Enabling Act of the Adjustment Plan (POA) of the Government of Puerto Rico, the head of House Finance Committee Jesús Santa said that a meeting could be held between the legislature and the FOMB to discuss the matter.
The board issued a statement last Friday stating that House Bill 1003 would make the seventh version of the Puerto Rico adjustment plan untenable because they understand that it involves issuing bonds on provisions that cost tens of billions of dollars Puerto Rico would not because the island’s government is bankrupt and it would prevent state pensions from being frozen and the system from reforming.
“A space will be created so that the specialist groups of the House of Representatives, the Senate and the Board of Directors can meet to discuss each of the Senate’s proposals in detail and to clarify the costs involved. I know (Senator) Juan Zaragoza’s group has these numbers and they are not as scandalous as they (the board of directors) wanted to illustrate in the letter we received, ”said Santa EL VOCERO, the sister publication of THE WEEKLY JOURNAL.
The position of the FOMB
The board’s statement reads: “The Puerto Rico House Bill 1003, as amended and approved by the Senate, required the issuance of the bonds with provisions that would cost tens of billions of dollars. The Senate bill would not only prevent any cuts in state retirees’ pension benefits, but would also prevent the freeze and reform of bankrupt pension plans that previous Puerto Rican governments had underfunded for decades. It adds costly mandates and massive spending increases as a condition for the implementation of the Seventh Revised Adjustment Plan.
“The Board has worked in good faith for five years with retirees, unions, bondholders and other creditors to negotiate a fair and sustainable adjustment plan, and with the legislature and the governor to pass new bond issuance laws. The Board believes that the passed legislation jeopardizes Puerto Rico’s ability to get out of bankruptcy and reiterates the unsustainable spending practices and policies that drove Puerto Rico into bankruptcy in the first place.
“The monstrous cost of the amendments to House Bill 1003, taken together, would make it impossible to confirm the Seventh Amended Adjustment Plan. Therefore, the board of directors would be forced to withdraw the proposed adjustment plan from the US District Court. “
Legislators speak out
The board’s rejection of the measure came just hours after House spokesman Rafael “Tatito” Hernández announced that the chamber would not consider the bill until the FOMB guarantees in writing that it will comply with the agreements made, so that it does not Pension cuts there. and funds for the island’s communities and the University of Puerto Rico.
MEP Lourdes Ramos, author of the measure that gave way to Law 7-2021 known as the Law on the Dignity of Pension, claimed that the board’s “threatening letter” reflected that it wanted to guarantee money for major interests.
“How good it is to be able to tell people: ‘I told you so.’ In my speech in front of the chamber when the bill was being discussed, I warned them that this was a measure that would give the board a blank check as the content it contained was no guarantee that the board would accept it, ”Ramos said .
For his part, the representative of the independence movement Denis Marquez said that the measure was “terrible for the country”. Every single one of their communications, their statements, their positions in court are in defense of their POA and their terrible policies for the country, which impoverishes people and workers and abolishes and maimed public services in favor of great interests, ”he said.
For Senate spokeswoman Ana Irma Rivera Lassén for Movimiento Victoria Ciudadana, the FOMB’s letter confirms her position that the board had to be blocked in such a way that it had to go to the legislature to negotiate the adjustment plan. “We’re going to be very vigilant about what happens because I think lawmakers should use this time to tell the board, ‘Well, we’re not going to do anything to issue the bonds and we have to sit down and talk about the POA ‘”Said Rivera.
–Managing editor Rosario Fajardo contributed to this story.