Sanโฃ Juan, Puertoโค Rico – โคthe Puerto Rico Fiscal โขAgency and โFinancialโ Restructuring โAuthority (PRFAA) announced today, February 29,โ 2024, a preliminary agreement intended to resolve the ongoing federal government shutdown impacting certain โฃPRFAA functions. the agreement, reached with relevant federal agencies, aims to restore full operationalโฃ capacity and ensure continued access to critical โขservices.
The partial federal closure, triggered by broader congressional budgetโข disputes,โ had โฃdisrupted PRFAA’s ability to processโข certain โfinancial โtransactions and โคfulfill obligationsโฃ related to Puerto Rico’s debt restructuring. โThis posed a risk to ongoing economic stability efforts and possibly impacted payments to creditors, bondholders, and pensioners. The โagreement provides โขa pathway to resume these essential operations โwhileโค a โlong-term โคsolution to โthe federal budget impasse is negotiated.
According to a PRFAA statement,โ the preliminary agreement outlines a โframework for temporary fundingโฃ and operational adjustments allowing the agency to continue essential functions, including debt serviceโ payments and ongoing โrestructuring โคprocesses. Specific details of the โagreement remain confidential pending finalization, but PRFAA officials confirmed it involves collaboration with the U.S. Treasury Department and other federal entities.โ
“We are pleased to โhave reachedโข this preliminary understandingโฃ with our federal counterparts,” said PRFAA Executive Director, Josรฉ M. Aguero. “This agreement is a critical step in mitigating โthe disruption caused by the federal governmentโ closure โขandโค safeguarding the financial stability of Puertoโฃ Rico.”
The PRFAA was established in 2016 under โขthe Puerto Rico Oversight, Management, โand economic stability Actโข (PROMESA) to oversee the โisland’sโ debtโค restructuring and fiscal โคrecovery. Puerto Ricoโ filed โคfor bankruptcy in May 2017, burdened by approximately $70โ billion in debt.โฃ The agency hasโฃ been working to negotiate with creditors โขto reduce the debt load and establish a sustainable fiscal path forward. The recent federal shutdown threatened โto derail those efforts.
PRFAA officials stated they will provide furtherโฃ updates asโฃ the agreement is finalized and โimplemented. They emphasized their commitment to openness and maintaining open communication with stakeholders throughout the process.
