Puerto Rico in Distress

ABI Analysis

A federal judge curbed Puerto Rico bondholders’ rights to the electric revenue generated by its public power utility, the last major public corporation in the U.S. territory still in bankruptcy after its other public debts were restructured, WSJ Pro Bankruptcy reported.

Puerto Rico Oversight Board member Justin Peterson and other observers of the Puerto Rico Electric Power Authority bankruptcy criticized what they said was the board's attack on U.S. revenue bonds in the lien adversary proceeding and called for state attorneys general to intervene, Bond Buyer reported.

Residential electric bills in Puerto Rico could increase by an average of $19 a month if a federal bankruptcy judge approves a proposal filed Thursday to restructure the staggering debt held by Puerto Rico’s power company, the Associated Press reported.

Puerto Rico Governor Pedro Pierluisi on Monday unveiled a sweeping tax reform proposal that would slash individual and corporate rates and simplify the US territory’s tax code, Bloomberg News reported. Under the proposal, Puerto Rico’s maximum tax rate for individuals would be reduced from 33% to 30%.