Puerto Rico Is Still in Hot Water With $72 Billion in Debt
A proposal to address Puerto Rico's debt burden lacks one big thing -- authority to file for Chapter 9 bankruptcy protection, writes attorney Charles M. Tatelbaum.
September 15, 2015 at 05:00 AM
4 minute read
The original version of this story was published on Daily Business Review
At first blush, the recent announcement that after months of high-level discussions, the Puerto Rico officials have proposed a huge raft of changes to address the commonwealth's $72 billion debt burden may seem to solve the financial tsunami facing the island.
However, a more careful review of the proposal — and more importantly what is not covered by the proposal — demonstrates that there is a long way to go with many uncertainties before there may be the proverbial light at the end of the tunnel.
Even if approved, the proposal, which still must be accepted by multiple governmental agencies and classes of creditors, will create an approximate $12 billion gap over the next five years based upon the shortfall in revenues versus expenses.
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