Last Thursday, June 9, Congressman Brett Guthrie (KY-02) voted in support of H.R. 5278, the Puerto Rico Oversight, Management, and Economic Stability Act (PROMESA), which passed the House with bipartisan support. The bill allows Puerto Rico to restructure their debt and imposes fiscal controls.
“I hear from Kentuckians who do not want to send their hard-earned tax dollars to bail out the bad decisions of Puerto Rico’s elected representatives. This bill will ensure that not a single taxpayer dollar will go toward bailing out Puerto Rico,” said Guthrie. “This bill may not be perfect, but it allows Congress to carry out its constitutional duty to address Puerto Rico’s fiscal crisis through governmental and economic reforms, while avoiding a taxpayer bailout.”
“Puerto Rico has found itself in a crisis of unsustainable debt because of its leaders’ irresponsible spending, compounded by an economic downturn,” added Guthrie. “The territory’s inability and unwillingness to take responsibility for its reckless spending hurts not only the Puerto Rican people, but also the investors in the United States who hold Puerto Rican bonds.”
H.R. 5278 facilitates a negotiation and settlement process between Puerto Rico and its creditors, which is not permitted under current law. The bill also creates an Oversight Board that will impose fiscal controls on the island’s budget and provide strong oversight of its government. The scope of the bill is strictly limited to ensure it does not set a precedent for states that are facing economic crises due to their own mismanaged budgets.