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Senator Durbin cites problems with House Puerto Rico debt bill

WASHINGTON (Reuters) - U.S. Senator Dick Durbin, the chamber’s second-ranking Democrat, expressed deep reservations on Tuesday with a Puerto Rico debt relief bill being debated by a House of Representatives panel this week.

The Government Development Bank (GDB) is seen in San Juan, November 30, 2015. Reuters/Alvin Baez

“I want to see the final product. The initial draft, I have some real problems with it,” the Illinois lawmaker told reporters. He added that some other Democrats had also expressed strong reservations with the measure.

Durbin said he was concerned that the bill that could move through the House would cut the minimum wage and overtime pay for some Puerto Ricans and fail to increase federal payments for Medicare and Medicaid, the healthcare programs for the elderly, poor and disabled, on the island.

He also said there were deep concerns whether bondholders ought to be able to be paid back in full under any debt restructuring plans that would be overseen by a newly created oversight board at a time when social services are being cut on the island.

Lawmakers are trying to enact a bill to prevent further economic and social chaos in Puerto Rico, where the government faces a July 1 debt payment of $1.9 billion.

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The island, a territory of the United States, has a total debt of roughly $70 billion.

The Republican chairman of the House Natural Resources Committee is hoping his panel votes by Wednesday to approve a Puerto Rico debt bill he negotiated with leading House Democrats and the Obama administration and send the measure to the full House for debate and passage.

Durbin told reporters he heard strong opposition to the House bill during a meeting in Chicago on Monday with Puerto Rican community leaders.

Durbin spoke following a weekly closed meeting of Democrats in which the Puerto Rico legislation was discussed.

“There wasn’t a single person (speaking) in support” of the bill during that meeting, he said.

Reporting by Richard Cowan; Editing by Alan Crosby and Peter Cooney