Why don't Puerto Ricans receive the same federal benefits?
3:16
(CNN Spanish) --
The judge of the United States District Court in San Juan, Laura Taylor Swain, confirmed on Tuesday the Debt Adjustment Plan that will serve to redistribute nearly US $ 33,000 million in obligations of the island government.
The Plan had been established in 2021 by the Financial Supervision and Administration Board, a federal entity created in 2016 to manage the finances of the local government after it declared bankruptcy with a debt that reached US$ 70,000 million.
The Oversight Board had filed the Debt Adjustment Plan with the United States District Court in San Juan to reduce the debt by 80% and save Puerto Rico more than $50 billion in debt service payments.
The Financial Oversight and Management Board for Puerto Rico was created under a bipartisan law of the United States Congress known as PROMESA or "Puerto Rico Oversight, Management and Economic Stability Act", of 2016.
The decision of the federal judge implies, among several points, that the pensions of more than 160,000 retired public employees will remain intact.
In addition, it proposes the creation of a capitalized trust with some US$ 1,000 million to pay obligations in case the government has a deficit.
On the other hand, it also establishes that thousands of public employees, participants in the retirement system, will recover the savings that they have contributed for years for their retirement, a total figure of around US$ 1,500 million.
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The bankruptcy of the government of Puerto Rico was reported in 2015 by then Governor Alejandro García Padilla, who declared the debt unpayable.
Regarding the court's decision, the governor of the island, Pedro Pierluisi, expressed that "the confirmation of the Debt Adjustment Plan of the Government of Puerto Rico presented by the Financial Oversight and Administration Board before Judge Taylor Swain represents a great step for the economic recovery of our island.
We are facing a transcendental moment in which the government of Puerto Rico is on its way to ending the bankruptcy process and thus concentrating on achieving a return to the progress that our people expect and deserve.”
