May 22, 2020
FOR IMMEDIATE RELEASE
Power 4 Puerto Rico Supports Amendments That Would Check
Wall Street-tilted Fiscal Control Board, aka La Junta
Coalition reiterates call on Congress to pass meaningful debt relief legislation
for Puerto Rico and to work towards repealing the PROMESA federal law
WASHINGTON, DC – The Power 4 Puerto Rico coalition, composed of diaspora and allied groups advocating for Puerto Rico and displaced families, today came out in support of legislation that would address some of the most severe issues in the Puerto Rico Oversight, Management, and Economic Stability Act (PROMESA) federal law. Through an undemocratic, unelected Fiscal Control Board (known in Puerto Rico as “la Junta”), PROMESA has imposed crippling austerity measures in the island that have further encroached on the already limited form of self-government of Puerto Rico in order to pay Wall Street bondholders at the expense of working Puerto Rican families.
While the series of improvements included in a bill introduced today by House Natural Resources Committee Chairman Raúl Grijalva (D-AZ) are aimed at addressing critical gaps, the coalition called for the eventual repeal and replacement of PROMESA with the U.S. Territorial Relief Act, sponsored by Congresswoman Nydia Velázquez (D-NY) and Senators Elizabeth Warren (D-MA) and Bernie Sanders (I-VT). The Territorial Relief Act would establish a voluntary mechanism to cancel Puerto Rico’s unsecured public debts and would compensate certain retail bondholders in Puerto Rico, while denying the Wall Street vulture funds the excessive windfalls they are looking for. Power 4 Puerto Rico endorsed this legislation last year and commends House Natural Resources Committee Chairman Raúl Grijalva (D-AZ) for including it in his bill to improve PROMESA. Joining Chairman Grijalva as original co-sponsors of the amendments to PROMESA bill are Reps. Velázquez (D-NY), José Serrano (D-NY), Alexandria Ocasio Cortez (D-NY), and Darren Soto (D-FL).
Power 4 Puerto Rico supports all of the amendments to PROMESA included in Chairman Grijalva’s bill. Key provisions include:
Establishing a Comprehensive Audit Commission to fully audit Puerto Rico’s debt
Ensuring the federal government - not the people of Puerto Rico - provides the funding for the Junta.
Preventing conflicts of interests in the Junta’s contracting practices, as well as within its membership. It also establishes internal controls and a yearly audit by the GAO of the Junta’s spending and operations.
Guaranteeing the funding of essential services that would ensure the population receives basic services, such as public health, public safety, pensions for public employees, and public education, which includes the University of Puerto Rico (UPR).
Including provisions of the U.S. Territorial Relief Act to cancel the Island’s unsecured debts
As a permanent solution, the coalition reiterated its call for the eventual full repeal of the law that created the Junta. In the interim, Power 4 Puerto Rico supports the Amendments to PROMESA Act of 2020 as the legislation would significantly improve the current PROMESA scheme, that time and again has proven to fail the people of Puerto Rico.
“After back-to-back natural disasters since 2017, Puerto Rico can no longer wait to start solving the man-made disaster that is PROMESA,” said Power 4 Puerto Rico Director Erica González. “The cruelty of this law is only matched by the cynical name chosen for it. PROMESA means promise in Spanish but for working families in Puerto Rico it has meant cuts to essential services, pensions, the public university system and municipalities that have borne the brunt of disaster relief after the neglectful and botched federal and central government response. Puerto Rico cannot rebuild in a sustainable way, while it continues to sacrifice the livelihood of Puerto Ricans at the altar of Wall Street debt payments. The time has come to significantly reduce the harm the Junta has perpetrated on Puerto Ricans by passing the bill introduced by Chairman Grijalva today as a first step to eventually repeal the nefarious PROMESA federal law.”
“The undemocratic nature of PROMESA was sold as the price to pay for an urgently needed debt restructuring mechanism for Puerto Rico. After four years, it is plainly clear that austerity is the worst recipe to recover from historic disasters and an economy in depression. The restructuring agreements reached by the Junta have disproportionately catered to wealthy bondholder interests, while shortchanging the essential services Puerto Ricans need now more than ever in the middle of the global pandemic,” Power 4 Puerto Rico Senior Advisor Federico A. de Jesús said. “The time has come for Congress to begin righting the wrong it inflicted on Puerto Rico by passing the Amendments to PROMESA Act of 2020, so we can audit and cancel most of the debt, protect essential services, and allow Puerto Rico to rebuild without destroying the socioeconomic fabric of our island. Short of a full repeal, this is the only legislation that has a realistic chance of putting the brakes on an undemocratic financial experiment that has failed the people of Puerto Rico.”
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