June 18, 2019 / 9:34 PM / a year ago

Puerto Rico board asks court for more time on members' appointments

SAN JUAN (Reuters) - Puerto Rico’s federally created financial oversight board asked a federal appeals court on Tuesday to extend a July 15 deadline for its members to be confirmed by the U.S. Senate, citing concerns that missing it could harm an ongoing restructuring of the bankrupt U.S. commonwealth’s debt.

The action followed an announcement by a U.S. Senate committee that the confirmation process will not begin for several weeks.

“Without such an extension, the oversight board would be unable to carry out its responsibilities on July 15, which will throw the debt restructuring process into chaos and threaten irreparable damage to the Puerto Rican economy,” the board said in a statement.

The board, which is overseeing the restructuring of about $120 billion of Puerto Rico debt and pension obligation through a form of bankruptcy, asked the Boston-based First Circuit Court of Appeals to extend the deadline pending a U.S. Supreme Court decision on whether to review the matter.

The appeals court in May extended a May 16 deadline for the board’s seven members to be reappointed or replaced to July 15. In February, in a case brought by Puerto Rico creditors, the court ruled that the members’ 2016 appointments violated the U.S. Constitution’s Appointments Clause because they were not confirmed by the Senate.

While the appeals court declined to void actions taken by the board, the ruling cast uncertainty around the board as it continued efforts to restructure Puerto Rico’s debt and pension obligations under a form of bankruptcy filed for the U.S. commonwealth in 2017.

The White House on Tuesday officially sent nominations for the board’s current members to the Senate Energy and Natural Resources Committee, which said it expects to receive paperwork for the nominees “within several weeks and will announce a hearing for (the nominations) shortly thereafter.”

The nominations cover only the remainder of the members’ terms, which all end on Aug. 30. A spokesman for the board said the members would continue serving until they are formally replaced.

The Supreme Court could announce as soon as Monday whether it will review the First Circuit’s appointments ruling.

After completing debt restructurings for Puerto Rico’s sales tax-backed debt and Government Development Bank, the board has said it will soon unveil a core government debt adjustment plan that includes outstanding general obligation bonds and unfunded pension liabilities.

Reporting by Karen Pierog in Chicago; Additional reporting by Luis Valentin Ortiz in San Juan; Editing by Matthew Lewis

0 : 0
  • narrow-browser-and-phone
  • medium-browser-and-portrait-tablet
  • landscape-tablet
  • medium-wide-browser
  • wide-browser-and-larger
  • medium-browser-and-landscape-tablet
  • medium-wide-browser-and-larger
  • above-phone
  • portrait-tablet-and-above
  • above-portrait-tablet
  • landscape-tablet-and-above
  • landscape-tablet-and-medium-wide-browser
  • portrait-tablet-and-below
  • landscape-tablet-and-below