A judge last week approved the $17.25 million sale of Doral Financial Corp.’s insurance arm to Popular Insurance LLC, which won a competitive auction earlier this month for the business, the Wall Street Journal reported today. The order was signed on Friday by Bankruptcy Judge Shelley C. Chapman.
Puerto Rico in Distress
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Puerto Rico’s Senate approved a bill, with amendments, that increases the cash-strapped island’s sales tax, potentially raising revenue that will help balance the fiscal 2016 budget, Bloomberg News reported today. The Senate passed (14-12) the measure yesterday with an amendment to exempt certain processed foods.
Puerto Rico’s governor submitted a $9.8 billion budget proposal calling for $674 million in cuts amid the U.S. territory’s economic crisis, The Washington Post reported on Wednesday. Gov. Alejandro Garcia Padilla did not present the budget during a televised address as is traditional, opting instead to file it after legislators recessed for the day.
Allowing Puerto Rico to restructure its public corporation’s debts in bankruptcy would help give the island’s economy some breathing room and politicians some authority to undertake further economic reforms, according to a commentary in the recent edition of The Weekly Standard magazine. The only problem is that as a U.S. territory, Puerto Rico cannot use chapter 9.
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The Financial Oversight and Management Board for Puerto Rico was created under the Puerto Rico Oversight, Management and Economic Stability Act of 2016. The Board consists of seven members appointed by the President of the United States and one ex officio member designated by the Governor of Puerto Rico. Access information on the Board, documents, videos of meetings, calendar of events and live webcasts by clicking here.