Mapp Spams Congress On Puerto Rico Bankruptcy Crisis Issue
CHARLOTTE AMALIE — Gov. Kenneth Mapp expressed strong concerns to congressional leaders about proposed changes in the language in the Puerto Rico debt restructuring bill released last week by the House Natural Resources Committee.
The legislation, if enacted, is likely to adversely affect the ability of the Virgin Islands to access capital markets and raise our cost of borrowing.
Mapp said that he urged members of Congress to take more time to consider the serious ramifications of the proposed substitute language on the U.S. Virgin Islands.
While Puerto Rico requires assistance in restructuring its debt, the bill includes a provision to make it easier for fiscal restrictions via Oversight Board to be imposed on other U.S. territories, he said.
Among the serious concerns raised by the provision is that these restrictions could govern how debts to bondholders and others will be paid – increasing the cost of raising capital, according to Mapp.
“I believe it is unfair and wrong to demand that the other Territories agree to the authorization for an Oversight Board with extraordinary powers — even one that would not be triggered unless requested by local resolution — without consultation with the Territories affected and without considering or understanding the impact of enacting such a provision on our ability to access the capital markets and the cost to our treasuries of accessing such critical capital,” he said.
Mapp said that Congress was moving to act quickly to provide relief to Puerto Rico prior to May 1 when some $400 million of Puerto Rico’s debt becomes due.
But he suggested that a stay be placed on any litigation or forced debt collection activity to give Congress the necessary time to consider the broader ramifications of the House bill, particularly its potential impact on the small territories.
The governor said that he sent letters Tuesday afternoon to House Speaker Paul Ryan, Democratic Leader Nancy Pelosi, Natural Resources Chairman Robert Bishop and several other ranking members of Congress.
He also reached out to governors in the other territories to ask that they join with him to ensure that their voices were heard before the House acts on what Mapp described as “momentous legislation.”