Blumenthal Statement on Puerto Rico's Default on Some Debts

(Washington, DC) – U.S. Senator Richard Blumenthal (D-Conn.) issued the following statement on today’s default by Puerto Rico on some of its debts owed to bondholders:

“As Puerto Rico’s fiscal fire continues to spread, Congressional inaction is only fanning the flames. The failure to pay certain creditors, exposing Puerto Rico to costly lawsuits, means that Congress’s continued foot dragging will lead to immense and irreparable damage for 3.5 million Americans living there. Puerto Rico will likely be burdened with costly, completely avoidable lawsuits further draining their already limited resources. A fiscal and humanitarian disaster is imminent unless Congress takes necessary, urgent action.”

Last month, Blumenthal and Senators Elizabeth Warren (D-Mass.), Harry Reid (D-Nev.), and Chuck Schumer (D-N.Y.) introduced the Puerto Rico Emergency Financial Stability Act, which would establish a short-term stay on creditor litigation until Congress takes action to allow Puerto Rico to restructure its debts. Over the summer, Blumenthal and Schumer introduced the Puerto Rico Chapter 9 Uniformity Act to grant Puerto Rico the authority to allow its municipalities and public utilities to restructure their debts under the supervision of a bankruptcy court, authority which is already currently granted to all U.S. states.

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