Fiscal board opposes Puerto Rico governor's alternative pension proposals
The Financial Oversight and Management Board has come out against two bills introduced by Gov. Pedro Pierluisi Urrutia in July to settle differences over the proposed pension cuts in the debt adjustment plan that would restructure $35 billion in Puerto Rico central government debt.
In a letter dated Aug. 2, the oversight board said that while the governor introduced the bills to the island Legislature to settle objections to Act 7 of 2021, the Dignified Retirement Act, which bans cuts to pensions and is the subject of litigation, it opposes the measures.
The oversight board filed a complaint against the government recently in court seeking to nullify Act 7, arguing that it interferes with the board’s powers under the federal Puerto Rico Oversight, Management and Economic Stability Act.
“Based on the Oversight Board’s preliminary review, many of the concerns set forth in the complaint seem equally applicable to the bills,” the board wrote. “Nevertheless, the Oversight Board is continuing its thorough review of the bills, their potential fiscal impact, and their consistency with the certified 2021 Commonwealth Fiscal Plan.”
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