[Congressional Record (Bound Edition), Volume 162 (2016), Part 6]
[House]
[Pages 8395-8432]
[From the U.S. Government Publishing Office, www.gpo.gov]




     PUERTO RICO OVERSIGHT, MANAGEMENT, AND ECONOMIC STABILITY ACT


                             General Leave

  Mr. BISHOP of Utah. Mr. Speaker, I ask unanimous consent that all 
Members may have 5 legislative days in which to revise and extend their 
remarks and to insert extraneous material on H.R. 5278.
  The SPEAKER pro tempore (Mr. LaMalfa). Is there objection to the 
request of the gentleman from Utah?
  There was no objection.
  The SPEAKER pro tempore. Pursuant to House Resolution 770 and rule 
XVIII, the Chair declares the House in the Committee of the Whole House 
on the state of the Union for the consideration of the bill, H.R. 5278.
  The Chair appoints the gentleman from Idaho (Mr. Simpson) to preside 
over the Committee of the Whole.

                              {time}  1543


                     In the Committee of the Whole

  Accordingly, the House resolved itself into the Committee of the 
Whole House on the state of the Union for the consideration of the bill 
(H.R. 5278) to establish an Oversight Board to assist the Government of 
Puerto Rico, including instrumentalities, in managing its public 
finances, and for other purposes, with Mr. Simpson in the chair.
  The Clerk read the title of the bill.
  The CHAIR. Pursuant to the rule, the bill is considered read the 
first time.
  The gentleman from Utah (Mr. Bishop) and the gentleman from Arizona 
(Mr. Grijalva) each will control 30 minutes.
  The Chair recognizes the gentleman from Utah.
  Mr. BISHOP of Utah. Mr. Chair, I yield myself such time as I may 
consume to say that to date, this is one of the most significant bills 
that has come to the floor in a long time, and it is going to be an 
excellent solution to a very, very difficult problem.
  I yield 5 minutes to the gentleman from Wisconsin (Mr. Duffy), the 
sponsor of the bill, for its introduction.

                              {time}  1545

  Mr. DUFFY. Mr. Chair, I thank Congressman Bishop and the whole 
Natural Resources Committee for all of the hard work they put into this 
bill.
  This has been a months-long process of working with Democrats and 
Republicans, the administration, Treasury, Puerto Rican elected 
officials, all coming together to negotiate, to discuss, to 
philosophize and then eventually come up with what I think is an 
excellent resolution to the burning crisis in Puerto Rico. I want to 
take a moment to talk about what is actually happening on the island.
  Puerto Rico is $73 billion in debt. That is over 100 percent of GNP. 
They have almost $2 billion of unpaid bills to their vendors. So what 
does that mean? That means schools are closing down because we don't 
have fuel for energy in the schools or for school buses. Hospital wings 
are closing. Emergency vehicles aren't being run because the island 
doesn't have money to pay its bills. This is a true economic crisis. It 
is a true humanitarian crisis that is taking place in Puerto Rico.
  So the question becomes: Does this institution act to help Puerto 
Rico, or do we continue to negotiate and refine and tweak a bill that 
will never come to the floor, that will never make it to the Senate, 
that will never gain the President's signature? Do we let perfect be 
the enemy of the good?
  I think this is a great bill that is going to actually get Puerto 
Rico on a path to prosperity, opportunity, and economic growth; that is 
going to help the people in Puerto Rico who have a dream of living in 
Puerto Rico stay in Puerto Rico with their families in their 
communities on the island that they love.
  Right now, there is despair. We have thousands of people leaving 
Puerto Rico every month to come to the mainland because there is no 
opportunity. This is what debt does to economies. It absolutely crushes 
them, and it crushes people.
  So what do we do? Well, we have a two-pronged approach. Number one, 
the elected officials in Puerto Rico have known that this issue has 
been coming for years, and they haven't been able to get their hands 
around it, haven't had the political will to fix the burning problem. 
So we are going to put into effect an oversight board to actually work 
with the island government to get its finances and its budgets under 
control.
  That oversight board is going to have an opportunity to work on debt 
restructuring, which is the second prong of this bill. $73 billion in 
debt, they can't pay it. People might want to wish that all the 
bondholders could be paid. They might dream about all the bondholders 
being paid, but the bottom line is Puerto Rico doesn't have enough 
income to pay its bondholders. They can't pay their vendors, let alone 
their bondholders.
  So we set up a system where the island and the bondholders have a 
forum in which to negotiate a settlement, a resolution to this massive 
debt. And if they can't come up with a resolution or a solution to the 
debt, they can access the court system, and the courts can help them 
resolve the disputes in regard to this massive debt. It is that system 
that is going to allow for debt restructuring and an oversight board 
that is going to bring Puerto Rico to a place of economic health. When 
you can get to a place of economic health, you can start to have a 
conversation about economic growth; and when you have economic growth, 
you actually help people, you help families, and you help communities.
  Now, there are some who have said that this bill is a bailout. Let me 
tell you what. I have the definition of a bailout, and a bailout 
happens when this institution sends taxpayer monies to somewhere else 
or to somebody else. The bottom line is this bill doesn't spend any 
taxpayer money bailing anybody out. There is no taxpayer money that is 
involved.
  What we do here is say: Hey, listen. If you invested in Puerto Rican 
bonds and you might have gotten a great upside, a great return on your 
bonds that you maybe bought at 50 or 60 cents on the dollar, you took 
that risk; and if there is a loss, you, the bondholder, are going to 
bear the loss on that bond, but the taxpayers aren't going to bear that 
loss for you.
  So I think this is a great compromise, a great package that is going 
to bring economic health and growth back to Puerto Rico.
  I want to thank Mr. Pierluisi for all of the insight that he has 
given to both sides of the aisle on what needs to be done to make this 
work, and the elected politicians, the Speaker of the Puerto Rican 
House, who has been so gracious with his insight into how we structure 
a package that is going to grow Puerto Rico.

[[Page 8396]]


  Mr. GRIJALVA. Mr. Chair, I yield myself 5 minutes.
  The United States flag has flown over Puerto Rico for more than a 
century. Those born on the island are American citizens, and more than 
200,000 have served in the United States military, including roughly 
10,000 serving today. Millions more live on the U.S. mainland but 
consider Puerto Rico their home.
  Mr. Chairman, we are here today because our fellow Americans are 
suffering, and it is our constitutional responsibility to help them. 
They are suffering from the effects of a debt crisis more than a decade 
in the making.
  A devastating combination of mismanagement, unfair Federal policies, 
opportunistic hedge funds, and desperate budget cuts have destroyed the 
economy on the island. The monstrous burden of Puerto Rico's $70 
billion debt is swallowing the funds needed to provide health care, 
education, transportation, and public safety for the Commonwealth's 
families.
  Almost 100,000 people have left the Commonwealth last year to look 
for better economic opportunities, which only makes the situation on 
the island worse. About 80 percent of children in Puerto Rico live in 
high-poverty areas, compared to about 11 percent of children on the 
mainland. The island's poverty rate is about 44 percent, and 
unemployment is 13 percent.
  If Congress fails to act, the island and its people face another 
decade of further economic and social collapse. Our fellow citizens of 
Puerto Rico should not have to endure this coming humanitarian crisis. 
Our colleague, Nydia Velazquez, has described the status quo as a 
``recipe to lose an entire generation to forced migration to the 
mainland.''
  After 6 months of difficult bipartisan negotiations, four hearings, 
and a series of draft bills, we are here today to consider H.R. 5278. 
H.R. 5278 will provide the tools necessary to get the economy of Puerto 
Rico on a more stable footing and allow the Commonwealth to regain 
access to credit markets.
  The bill would allow restructuring of all outstanding debt without 
favoring any particular creditor; require transparent audits, combined 
with annual fiscal plans and budgets; and temporarily pause the ongoing 
flurry of litigation to allow the oversight board to begin its work and 
create a space for voluntary negotiations.
  As I have said throughout this process, this is not a bill that I or 
Democrats would have written. The oversight board is too powerful and 
is yet another infringement of the sovereignty of the people of Puerto 
Rico, and they have a right to find it offensive. The provisions 
undermining minimum wage and overtime rules don't belong in the bill. 
What is worse, they threaten the effectiveness of the overall 
legislation.
  Provisions that should be included--like full pension protections, an 
earned income tax credit, equal funding for Medicaid, and a Zika 
response--are missing. But the reality is that this is the only bill 
that would attract enough support from my colleagues across the aisle 
to pass in a Congress which they control. There is no other avenue 
available to address the crisis. This compromise is the bill we can and 
should pass.
  When measured against a perfect bill, this legislation is inadequate. 
When measured against the worsening crisis in Puerto Rico, this 
legislation is vitally necessary.
  I urge my colleagues to support H.R. 5278.
  I would like to take a moment to clarify for the record a number of 
inaccurate and misleading statements in the Committee Report on H.R. 
5278. It appears that the Committee Report on H.R. 5278 was prepared 
based on earlier non-public drafts of the bill--not the version 
considered by the Committee. Several references plainly do not reflect 
the current language in H.R. 5278 as introduced or as voted on by the 
House Committee on Natural Resources during its markup hearing.
  The following statement on page 40 of the Committee Report 
oversimplifies a complex problem facing Puerto Rico and, in my view, 
mischaracterizes the nature of the territory government's action: It 
says, ``Puerto Rico's local politicians have accelerated the crisis on 
the island through the passage of harmful legislation, including the 
imposition of a moratorium on the payment of debt.'' Puerto Rico's 
passage of a moratorium law was a local response to attempt to address 
its fiscal and debt emergency in the absence of necessary Congressional 
action. It is misleading and unreasonable to characterize the passage 
of a local moratorium law as accelerating the crisis.
  The Committee Report's summary of section 101 provides that: 
``[additionally, this section provides for the appointment of seven 
individuals to the Oversight Board through a process that ensures that 
a majority of its members are effectively chosen by Republican 
congressional leaders on an expedited timeframe, while upholding the 
President's constitutional role in making appointments.'' Let's be very 
clear: The President appoints all seven members of this Puerto Rico 
Board. To be sure, members of Congress may make suggestions to the 
President, but the power to appoint members of this territorial entity 
remains with the President.
  The Committee Report's summary of section 201 is inaccurate in a 
number of respects. The report states, on page 45, that 
``[i]mportantly, Fiscal Plans ensure the protection of the lawful 
priorities and liens as guaranteed by the territorial constitution and 
applicable laws, and prevent unlawful inter-debtor transfers of 
funds.'' This interpretation is misleading and does not reflect the 
language of the bill or the evolution of the language throughout the 
legislative process. Section 201(b)(1)(N) provides that a Fiscal Plan 
certified by the Oversight Board must ``respect'' the relative lawful 
priorities or lawful liens under territory laws, not ``ensure the 
protection'' of such priorities or liens. The verb ``respect'' was 
specifically chosen by the drafters of the bill and carefully 
considered by the Committee. For instance, at the Committee markup, 
Representative Fleming twice offered amendments that would have changed 
the ``respect'' language in section 201(b)(1)(N) to ``comply with.'' 
The Committee twice rejected those amendments--the first time on a 
voice vote and the second time on a roll call vote, 16 yeas to 23 nays. 
The Committee recognized that the verb ``comply with'' was unduly 
restrictive and that the Oversight Board needed the flexibility 
afforded by the verb ``respect,'' which is more open-ended. For that 
reason, it is inaccurate for the Committee Report to state--contrary to 
the current legislative text and the Committee's intent--that Fiscal 
Plans ensure the protection of lawful priorities and liens.
  In addition, the summary of section 201 explains that ``[w]hile this 
language seeks to provide an adequate level of funding for pension 
systems, it does not allow for pensions to be unduly favored over other 
indebtedness in a restructuring.'' But Section 201(b)(1)(C) has nothing 
to do with relative priorities among various creditors; the provision 
requires the Board to provide for adequate funding of pensions, which 
relates to the Fiscal Plan and the manner by which annual budgets 
comply with the Fiscal Plan. Of course, any restructuring under Title 
III must be consistent with the Fiscal Plan under Section 314 of the 
bill, but the Committee Report is inaccurate in suggesting that this 
provision relates to relative priorities.
  The following statement on page 48 summarizing section 303 is missing 
a critical adjective: ``nor may an executive order divert funds from 
one instrumentality to another or to the territory.'' Certain executive 
orders that divert funds from one territorial instrumentality to 
another or to the territory may be lawful under applicable territory 
laws. The only types of executive orders that are preempted by section 
303(3) of this Act are ``unlawful'' executive orders, as the text of 
section 303(3) makes abundantly clear. For instance, if an executive 
order is permitted by the territory's constitution or its laws, it is 
not an unlawful executive order and is not preempted by section 303. 
The drafters intended section 303(3) to make clear that PROMESA 
preempts and renders void any executive orders issued beyond the scope 
of what would have been authorized by its local laws; lawful exercises 
of executive authority are unaffected.
  In summarizing section 314 on page 50, the report states: ``[b]y 
incorporating consistency with the Fiscal Plan into the requirements of 
confirmation of a plan of adjustment, the Committee has ensured lawful 
priorities and liens, as provided for by the territory's constitution, 
laws, and agreements, will be respected in any debt restructuring that 
occurs.'' This summary suffers from the same problem that the summary 
of the provisions of section 201 suffered: It refers to language that 
has never existed in a public version of the bill; rather, it reflects 
staff-level draft text that was ultimately rejected. Section 201 
clarifies that Fiscal Plans must ``respect'' lawful priorities and 
lawful liens. The Committee carefully considered this

[[Page 8397]]

language and twice rejected amendments proposed to change it to 
``comply with'' such priorities and liens.
  The summary of section 407 on page 52 explains that: ``[t]his section 
grants creditors the right to sue upon the conclusion of the stay, if 
the government of Puerto Rico transfers property between 
instrumentalities during the tenure of the Oversight Board in violation 
of any agreement, or applicable law that a creditor has or would have a 
pledge of, security interest in, or lien on such property.'' Section 
407, as drafted and passed through Committee establishes a federal 
remedy for Puerto Rico's creditors in certain circumstances. But the 
addition of the language ``or would have'' in the Committee Report, 
again, reflects staff-level text that was not ultimately included in 
the version approved by the Committee. The current text provides a 
cause of action for creditors that--at the time of the alleged unlawful 
transfer--in fact have ``a pledge of, security interest in, or lien 
on'' the transferred property. Contrary to the suggestion of the 
Committee Report, the provision does not permit such a cause of action 
if the plaintiff only ``would have'' in some future circumstance such 
an interest.
  Indeed, the fact that the addition of words like ``or would have'' 
were discussed but not ultimately included in the text is strong 
evidence that Congress did not intend for such prospective, contingent 
rights to be within the scope of this provision. It would have been 
extraordinary to provide certain creditors an argument that federal law 
establishes for them a property interest where no such property 
interest existed under the terms of the agreements they negotiated. The 
Committee rightly declined to do so.
  I reserve the balance of my time.
  Mr. BISHOP of Utah. Mr. Chairman, I yield 2 minutes to one of the 
senior members of our committee, a senior member of his delegation, and 
someone who happens to be celebrating today not only his anniversary, 
but also his birthday; and what better way of giving a birthday present 
to the Representative from Alaska than to allow him to speak on the 
floor on the subject of Puerto Rico.
  I yield 2 minutes to the gentleman from Alaska (Mr. Young).
  Mr. YOUNG of Alaska. Mr. Chair, I rise today in support of H.R. 5278.
  May I commend Chairman Bishop for his kindness in recognizing my 
birthday and my anniversary. I am quite proud of that. I am 83 years 
old. I want a lot of you to remember the fact I still can kick tails 
and take names, so just keep that in mind.
  This is a bill that I do support. It has been worked together with 
the Puerto Ricans. It has been worked together with Representatives 
Grijalva and Pierluisi. I would say most all of the people involved in 
this recognize this is not everything we would want, but it is the 
bill, I think, that can help Puerto Rico today and now.
  It is not a bailout. That is for some people who keep saying it is a 
bailout. It does not allow taxpayer dollars to be used for paying down 
the Puerto Rican debt.
  I held a hearing in February on the oversight board concept, and it 
was clear that it was needed and it was testified in favor of. I 
understand some reluctance in Puerto Rico, but let's get this ship 
righted. Once we get it righted, restaffed, and the sails full of wind, 
then Puerto Rico will have a chance.
  I do support the multiple-step process. The bill combats the 
immediate crisis. It will help out Puerto Rico's ability to take and 
get credit. We need more long-term solutions, though, about the 
economic zones in Puerto Rico and how we improve the economy there so 
they can continue to grow.
  I want to compliment Mr. Duffy's amendment, and I will support Mr. 
Duffy and his work on this legislation. I do believe a HUBZone is very 
necessary in the contracting program.
  As I mentioned, I have been worked passionately on Puerto Rican 
issues on the floor of the House. Fifteen years ago, we had a vote 
about statehood. I passed it by one vote. I am a big supporter of 
statehood and always have been. It didn't occur. We didn't allow it.
  Right now, this problem has to be addressed.
  I again do compliment Mr. Bishop, Mr. Duffy, and members on that side 
of the aisle. Let's take our American people and Puerto Rico and give 
them the recognition that is necessary. Let's take and help them now so 
we can go forth.
  Mr. GRIJALVA. Mr. Chairman, I yield 5 minutes to the gentlewoman from 
New York (Ms. Velazquez).
  Ms. VELAZQUEZ. Mr. Chairman, I want to take this opportunity to 
really thank Ranking Member Grijalva for the important role that he has 
played throughout this process.
  Mr. Chairman, I rise in support of the bill. When I was elected to 
Congress, I understood there would be tough votes. For me, PROMESA is 
one of those votes. For those of us with ties to Puerto Rico, this a 
profoundly personal issue.
  There is plenty of blame to go around for this situation. San Juan 
has played a role, but Washington and Wall Street have equally 
contributed to this crisis. It is a crisis that is already harming 
working families that call the island home and, if left unaddressed, it 
will grow immeasurably worse.
  So today we stand at a fork in the road: one path--the bill before 
us--empowers Puerto Rico to restructure 100 percent of its debt; the 
only other route sends Puerto Rico to the courthouse, where it will be 
at the mercy of creditors that will inflict further suffering on the 
island.
  Now, some would suggest that if we oppose this bill, somehow a third 
option will magically appear before us. That is nonsense. The stark 
reality we now face is that, other than PROMESA, there are simply no 
other politically feasible options left.
  That does not mean that this is a perfect bill. It is not even close. 
It makes no sense that this bill includes an attempt to pay Puerto 
Rican workers less than those on the mainland. It is offensive that 
Puerto Rico must foot a $370 million price tag for an oversight board 
its residents do not want. And the bill does not address economic 
growth incentives and healthcare parity, issues at the core of Puerto 
Rico's crisis.
  Despite these shortcomings, I see no alternative. If we do not act, 
Puerto Rico will unravel further. Basic services are being cut, and 
these cuts will deepen. More schools will close. More police and 
firefighters will be terminated. And those who will pay the price are 
Puerto Rico's most vulnerable: its children, its seniors, and its 
working families.
  We have a profound responsibility to prevent this catastrophe from 
worsening. Those suffering on the island are my brothers and sisters, 
my fellow Puerto Ricans.

                              {time}  1600

  But, my friends, they are also your fellow citizens. 200,000 Puerto 
Ricans have fought--and shed blood--in every military conflict since 
World War I. Now these citizens need our help. This is a responsibility 
we cannot ignore. You see, when the United States took Puerto Rico--and 
remember we seized it by force--we did not just obtain a pretty island. 
We also took on a responsibility to care for the people who live there.
  Now, let me say this: Living up to that responsibility does not end 
with this vote on this bill today. Decisions made by Washington over 
decades have corroded Puerto Rico's economy. Addressing those problems 
will require more work by Congress. Until we end the colonial 
conditions that have subjugated and exploited the island, there will be 
no long-term recovery.
  So this bill alone is not enough. We must pass additional 
legislation, in the next 6 months, addressing Puerto Rico's deep-seated 
economic challenges and ongoing healthcare crisis. If we do not, then, 
Washington, we have failed the people of Puerto Rico once more.
  Mr. Chairman, this is not the legislation I would have written, but 
it is the only way we can extend a lifeline to Puerto Rico right now. 
In many ways, the easy path for me would be to vote ``no.'' Certainly, 
I have heard the case made by some in the Puerto Rican community.
  The CHAIR. The time of the gentlewoman has expired.
  Mr. GRIJALVA. Mr. Chair, I yield an additional 1 minute to the 
gentlewoman.

[[Page 8398]]


  Ms. VELAZQUEZ. I thank the gentleman.
  Mr. Chair, at the end of the day, I know that if this bill does not 
pass, people I care about and love on the island I grew up on will 
suffer greatly. At least with this legislation, Puerto Rico can begin 
restructuring its debts and start down a new path toward a brighter 
future. I urge my colleagues to vote ``yes'' on the bill. Then please 
join me in working to address the other long-term challenges 
confronting Puerto Rico.
  In closing, let me thank all those who worked on this legislation, 
especially Leader Pelosi, Speaker Ryan, and Whip Hoyer. Let me also 
thank Ranking Member Grijalva and Chairman Bishop for their efforts as 
well as my fellow Puerto Rican Members of Congress. And, of course, our 
thanks to the staff who dedicated countless hours crafting this 
compromise.
  Mr. BISHOP of Utah. Mr. Chair, I yield 2 minutes to the gentleman 
from Florida (Mr. Curbelo). He is from the southern tip of Florida, as 
close to Puerto Rico as you can get on the mainland.
  Mr. CURBELO of Florida. Mr. Chairman, today I rise in support of H.R. 
5278, the Puerto Rico Oversight, Management, and Economic Stability 
Act, or PROMESA. I want to thank Chairman Bishop and Representative 
Duffy, who have shown steadfast leadership in finding practical 
solutions to address the fiscal crisis in Puerto Rico.
  The situation in Puerto Rico is urgent and so is the need for a 
responsible reform agenda. Hundreds of thousands of citizens have left 
the island--many have come to Florida--to find better opportunities as 
a result of the deteriorating economic conditions.
  Our friends in Puerto Rico, our fellow American citizens deserve a 
better future, one that gives them the chance to achieve prosperity on 
the island. This legislation is an important step forward in helping 
the island mitigate the existing humanitarian and economic emergency in 
a responsible way.
  The bill also allows the congressional task force to look at 
impediments to economic growth and poverty reduction, including 
equitable access to Federal healthcare programs for the island's 
residents. Serious challenges remain in the healthcare sector--like the 
impending Medicaid cliff--that could have a detrimental impact on the 
future of the island.
  I also urge my colleagues to vote in favor of my amendment with Mr. 
Jolly which will guarantee that addressing the nearly 60 percent of 
children living in poverty on the island is a top priority. As we work 
to achieve economic stability on the island, we must also ensure that 
the mechanisms in this bill benefit the extremely vulnerable child 
population.
  Congress has an important interest in ensuring that Puerto Rico not 
only survives the current crisis, Mr. Chairman, but that it is able to 
build a better and more sustainable future. Again, I am very supportive 
of the bipartisan solutions in H.R. 5278, and I urge my colleagues to 
vote in favor of the bill and of my amendment which addresses child 
poverty on the island.
  Mr. GRIJALVA. Mr. Chairman, I yield 3 minutes to the gentleman from 
Maryland (Mr. Hoyer), our whip.
  Mr. HOYER. Mr. Chairman, at the outset, rarely do we see the 
political courage and intellectual integrity that we have seen in the 
gentlewoman from New York (Ms. Velazquez). I have worked with her for 
months now trying to get to a solution fair to Puerto Rico and fair to 
the 3.5 million American citizens who live in Puerto Rico.
  I also want to thank my friend Jose Serrano, also from New York, also 
Puerto Rican, also having thought about this extraordinarily 
thoughtfully, and it has been difficult. I want to congratulate both of 
them for coming to the decision that is a terribly difficult one for 
them that this is, at this juncture, the only alternative to the pain 
and the suffering of which Ms. Velazquez spoke.
  I am sure the citizens of Puerto Rico are watching this debate, and 
they understand this is not a perfect bill. It is not the bill I or Mr. 
Pierluisi--who lost an election, in my view, because of his fidelity to 
what he believes is in the island's best interest--would have written.
  It forces Puerto Rico to take some bitter medicine, accept an 
oversight board with broad powers that is unacceptable to many living 
on the island, and it does not provide additional assistance to the 
island that is critically needed and ought to be done. Hopefully we can 
address that.
  It is a compromise, and it will enable the Commonwealth of Puerto 
Rico to restructure its debt and prevent economic catastrophe. I can 
assure both sides of the aisle in this Chamber and in the Senate that 
it is a compromise forged out of a serious consideration of all 
possible alternatives that could result in bipartisan agreement.
  We must not risk the cost of further inaction by this Congress, which 
should have acted months ago; but it is not too late to do the right 
thing. Congress must act before Puerto Rico's next interest payment is 
due on July 1.
  According to The New York Times Editorial Board: This bill ``has 
flaws . . .''.
  I think both sides would agree to that.
  The New York Times went on: ``. . . but at this late hour, it offers 
the island its best chance of survival.''
  It is, therefore, Mr. Chairman, my advice and urging to our Members 
that we vote for this bill. We need to come together and pass this bill 
without any controversial riders.
  Again, I want to thank Representatives Velazquez and Serrano and 
Resident Commissioner Pierluisi for their leadership, their courage, 
and their integrity.
  Mr. Chairman, we need to pass this bill for the American citizens 
living on Puerto Rico and to meet the responsibility of which Ms. 
Velazquez spoke so eloquently.
  Mr. BISHOP of Utah. Mr. Chairman, I yield 2 minutes to the gentleman 
from Arkansas (Mr. Westerman), one of the premier members of our 
committee.
  Mr. WESTERMAN. Mr. Chairman, I rise today in support of H.R. 5278. I 
thank the gentleman from Wisconsin, Congressman Duffy, and Chairman 
Bishop for their work in crafting this bipartisan legislation.
  H.R. 5278 is a compromise bill designed to save Puerto Rico from 
economic calamity and prevent a taxpayer bailout. Mr. Chairman, I 
suggest that the admission from both sides of the aisle that this bill 
isn't perfect is a testament that this bill is the best solution.
  Puerto Rico is in a crisis. The territory has already missed payments 
on its debt, and more and larger missed payments are on the near 
horizon. The fiscal and economic conditions of Puerto Rico are 
unsustainable. Based on the constitutionally delegated power of 
Congress ``to dispose of and make all needful rules and regulations 
respecting the territory or other property belonging to the United 
States,'' we have a responsibility to take action on this matter.
  This unsustainable debt burden brought on by poor decisions, 
unfulfilled promises, and bad investments has crippled their economy. 
Their unemployment rate is 12.2 percent, and since Puerto Ricans are 
American citizens, thousands of young people come to the mainland each 
year to find work. Puerto Rico is spiraling out of control, and it is 
our constitutional responsibility to put our territory on a different 
path and change the economic trajectory.
  H.R. 5278 establishes a 7-member oversight board that will have the 
authority to establish budgets for the territory, require the scoring 
of legislation so the people of Puerto Rico know the true costs of 
government programs, and the power to veto contracts and executive 
orders.
  Once again, I would like to thank Congressman Duffy and Chairman 
Bishop for their hard work in crafting a bill to get Puerto Rico on the 
right track without a taxpayer bailout. I urge my colleagues to support 
H.R. 5278 to stop Puerto Rico's economic death spiral and to lay a 
foundation for a brighter future in Puerto Rico without spending 
taxpayer dollars.
  Mr. GRIJALVA. Mr. Chairman, I yield 3 minutes to the gentleman from 
New York (Mr. Serrano).

[[Page 8399]]


  Mr. SERRANO. Mr. Chairman, when we started these negotiations, with 
both sides wanting to do something, with both leaderships in the House 
wanting to do something, I knew that at the end of the day I would be 
voting for a bill. I knew I had to do that for a very simple reason. 
Inactivity, inaction was not an option. The only option was to do a 
bill.
  What that bill would look like was my question. What that bill would 
look like was my challenge and my dilemma. The bill changed. The 
original bill had some provisions that no one could really defend on 
either side. We have made a bill now that does have some hard pills to 
swallow, but then over $70 billion in debt with no signs of being able 
to pay is even more of a bitter pill to swallow. The territory is 
hurting. The people are hurting.
  In fact, if anything comes out of this that is positive, it is the 
fact that the U.S. Congress is paying attention to Puerto Rico in a way 
that it hasn't in a long, long time, if at all. We are paying 
attention, and we want to do something about the situation at hand.
  We are not supposed to direct our comments to the gallery or to the 
TV cameras, so I won't do that. But there are people watching this, and 
they need to have faith in the fact that both parties have come 
together to come together with a plan that will help us, a plan that 
will bring Puerto Rico back out of this debt situation. And, most 
importantly, I believe there is a commitment on both sides to work on 
economic development projects for the future to help Puerto Rico and 
its economy.
  But I couldn't get off this podium today without addressing my most 
important issue, and that is that the problem with Puerto Rico 
continues to be the status. As long as Puerto Rico is a colony, a 
territory of the United States, these issues will come back and other 
issues will come back.
  I once, some months ago, either sarcastically or very profoundly, 
said that all we were doing if we didn't deal with the status was 
putting a Band-Aid on a bigger problem. Well, there is a bigger 
problem, and I think it is time Congress came together with the people 
of Puerto Rico and decided to end the colonial status. But ending the 
colonial status does not mean tweaking the colony to make it a little 
better or washing the face of the colony to make it a little more 
presentable. It means getting rid of the colony and either becoming the 
51st State or an independent nation. There is no other solution.

                              {time}  1615

  And for us, as the people who promote--and rightfully so--democracy 
throughout the world, to have a colony for 118 years is wrong. And 
remember, Puerto Rico didn't do this by itself. The indifference and 
inequality created this problem, as much as everything else.
  Mr. BISHOP of Utah. Mr. Chairman, I yield 2 minutes to the gentleman 
from Idaho (Mr. Labrador), my good friend, who has done a whole lot of 
work on this particular bill.
  Mr. LABRADOR. I thank the chairman and Mr. Duffy for the work they 
and their staffs have done on this critical piece of legislation. I 
especially want to thank my staffer, Aaron Calkins, for his work to 
make this a better bill. We have worked countless hours to improve this 
bill, and I am proud of the work that we have done.
  Mr. Chairman, I rise today as a member of the Natural Resources 
Committee and as a Representative of Idaho's First Congressional 
District to support H.R. 5278.
  The debt crisis in Puerto Rico is a result of years of liberal 
policies where the government carelessly borrowed and overspent, while 
simultaneously encouraging mismanagement and inefficiency. We cannot 
view Puerto Rico's situation in a vacuum. If left unresolved, the 
financial crisis in Puerto Rico will impact the rest of our Nation.
  The bill imposes fiscal reforms without spending a single dollar of 
U.S. taxpayer money to relieve Puerto Rico's debt. The bill protects 
taxpayers from bailing out a government that spent recklessly and 
avoids setting a horrible precedent that could tempt free-spending 
States to walk away from their obligations.
  Specifically, H.R. 5278 establishes a strong oversight board to 
require Puerto Rico to balance its budget and achieve fiscal 
responsibility. The bill includes language that ensures that the fiscal 
plans and any potential restructuring must honor lawful priorities and 
liens as guaranteed by Puerto Rico's constitution and laws.
  Every State and municipality in this country relies on bond markets 
to provide funding for government operations. H.R. 5278 creates the 
balance that will effectively address the needs of Puerto Rico, while 
ensuring access to these markets for States and municipalities 
nationwide.
  In conclusion, as a person who was born and raised in Puerto Rico and 
somebody who is very proud of his Puerto Rican heritage, I love the 
people, I love the island, and I hope that this bill sets them on the 
path to fiscal responsibility and a brighter future.
  The House must pass this bill to establish the necessary framework to 
help Puerto Rico put its fiscal house in order, while also protecting 
the interests of every American.
  Mr. GRIJALVA. Mr. Chairman, I yield 5 minutes to the gentleman from 
Puerto Rico (Mr. Pierluisi), who, at great risk politically, continued 
to push for this compromised bill we have before us; and for that, we 
are grateful.
  Mr. PIERLUISI. Mr. Chairman, I represent Puerto Rico in Congress, and 
I rise in support of PROMESA.
  Puerto Rico is at a crossroads. Since 1898, it has been a territory 
of the United States, subject to the broad powers of Congress under the 
Territory Clause.
  In 1917, Congress conferred U.S. citizenship on individuals born in 
Puerto Rico. In the 1950s, Congress authorized and approved a 
constitution for Puerto Rico, which provides the island with a 
republican form of government consisting of three branches.
  Because Puerto Rico is a territory, my constituents have never been 
treated equally relative to their fellow U.S. citizens in the States in 
terms of either democratic rights or economic opportunities. In large 
part, to compensate for the lack of fair treatment at the Federal 
level, the Puerto Rican Government has spent beyond its means at the 
local level, leading to excessive deficits and debt.
  This lack of discipline is regrettable but understandable, since the 
Puerto Rican Government is seeking to provide a quality of life to 
island residents comparable to the quality of life in the States. Bear 
in mind that my constituents can hop on a plane any time, any day, and 
move to Florida or Texas.
  The bill we consider today, PROMESA, is a bipartisan compromise 
intended to deal with the territory's unprecedented fiscal crisis, 
which is severe and immediate. The bill will enable Puerto Rico to 
restructure its public debt in a fair and orderly manner, while 
establishing an independent and temporary oversight board to ensure 
that Puerto Rico has a viable, long-term fiscal plan and balanced 
budgets and that it sticks to both.
  In an emergency, the first step is to stabilize the situation, and I 
believe PROMESA can accomplish this objective. Without this 
legislation, the Puerto Rican Government is likely to collapse, 
participants in public pension plans will be terribly harmed, and many 
bondholders could lose their investments.
  PROMESA is in the interest of all stakeholders, and the most likely 
alternative is chaos, litigation, a rapidly deteriorating quality of 
life in Puerto Rico, and even greater migration to the States. However, 
let me be plain. This bill is an essential first step, but it is not an 
enduring solution.
  The Federal Government and, indeed, the Puerto Rican Government must 
come to terms with a fundamental fact: so long as my constituents are 
treated like second-class citizens, Puerto Rico will never have a 
first-class economy.
  Puerto Rico must become a full and equal member of the American 
family as a State, which is the just and logical next step, or Puerto 
Rico must join the community of nations as a sovereign country.

[[Page 8400]]

  Puerto Rico deserves true democracy and true dignity--nothing less--
yet first things come first. We have to deal with this immediate 
crisis. We have to save the house in Puerto Rico. Vote ``yes'' on H.R. 
5278.
  Mr. BISHOP of Utah. Mr. Chairman, I, too, would like to express my 
appreciation and sincere gratitude to the Resident Commissioner of 
Puerto Rico for his hard work.
  I may be known as the historian of this body, but the gentleman from 
Oklahoma will give a historical perspective.
  Mr. Speaker, I yield 2 minutes to the gentleman from Oklahoma (Mr. 
Lucas).
  Mr. LUCAS. Mr. Chairman, I rise today to note that there are only a 
handful of my colleagues on the floor or in the body who were here when 
the precedent for this process was set in 1995.
  Some of my colleagues on this side of the room argue that we are 
setting a new precedent. We are not. Some of you remember 1994, when I 
came as a new Member in a special election. Some of you remember the 
economic chaos, the near collapse of the District of Columbia and the 
city of Washington. Some of you remember how we were told in those days 
that you can't go into certain parts of town because it is not safe. 
Some remember the stories about how a high percentage--if not almost 
half--the police cars wouldn't run at any one time.
  I remember waking up one July night and looking out the fifth-floor 
window of the apartment building I was in as the firemen were hosing 
down a spot not many paces from the corner of First and D Streets where 
someone had been killed, literally within hundreds of feet of the 
Federal campus. Washington, D.C., the District of Columbia, was about 
to collapse into chaos--1994.
  So what did we do in 1995? We passed a bill very similar to this. We 
set up a supervisory board that took control of the finances to help 
right the ship.
  For 2 years, there were tremendously painful decisions made here in 
Washington, D.C., at the municipal level; but after those 2 years, we 
had 4 years of balanced budgets, and the Control Act, as it was called, 
was suspended. It was successful. And the renaissance this town, this 
community has gone through all started with that bill in 1995.
  Now, I am voting for this piece of legislation because I believe my 
fellow American citizens who live in Puerto Rico deserve the right to 
have a renaissance, deserve the right to move forward. But we are all 
Members of elected bodies and we know how tough these decisions and 
situations are.
  Pass this bill; create the supervisory board; give the good citizens 
of Puerto Rico, the Commonwealth, our fellow Americans, a chance to 
benefit, just as Washington, D.C., did. They deserve the chance.
  Mr. GRIJALVA. Mr. Chairman, I yield 3 minutes to the gentleman from 
Illinois (Mr. Gutierrez).
  Mr. GUTIERREZ. Mr. Chairman, I rise in opposition to this 
legislation. The people of the enchanted island deserve better. It is 
my duty to my heritage and to the land where I intend to return some 
day and where someday--hopefully, not soon--I intend to be buried.
  As President Obama said so profoundly when he visited the land of his 
father's birth, Kenya, a nation with one of the richest histories of 
the struggle for freedom against the colonial power, I, too, Luis 
Gutierrez, am deeply and profoundly connected to my father's 
birthplace.
  I cannot add my vote to this bill and go back to Puerto Rico or to 
the Puerto Rican people in my congressional district in Illinois with 
my head held high. I cannot and will not, not when I know that the 
majority of votes that will pass this legislation if it passes today 
will come from the Democratic Party, a party that, for all its flaws, 
is a party I expect a lot more from in times like this.
  At a moment in American history when Latinos are quite literally 
being dragged through the mud by the other party and maligned for being 
Latinos and distrusted and disrespected because of where their parents 
or grandparents were born, I expect my fellow Democrats to stand up 
tall when the lives and destinies of so many citizens--the entire 
island and its people--are held in the hands of the U.S. Congress.
  By law, they do not have a vote here. By law, they need others to 
vote on their behalf. By law, Puerto Rico belongs to, is property of 
but not part of, the United States. By law, this Congress owns Puerto 
Rico and must treat that ownership as stewardship, as a caring and 
respectful seat of power over the powerless.
  And because it is the Democratic Party that will supply so many folks 
to enact this bill, I expect my colleagues to demand more. I expect us 
not to support a sub-minimum wage. I expect us not to waive overtime 
rules that pay people for the work they do.
  I expect my fellow Democrats to stand up for equity and equality for 
Puerto Ricans in our Tax Code, in Medicare and health care, so that 
they don't have to flee Puerto Rico to go to Orlando, Newark, or 
Chicago.
  I expect Democrats to join me in opposing the same type of unelected 
control board that has no accountability to the people that it is 
controlling--the type of control board focused on austerity without 
consequences of action for the people; the kind of control board that 
made decisions in Flint, Michigan, and that poisoned the people that 
did not elect them, that acted slowly to remedy the situation until 
other governments and other elected leaders accountable to the people 
they govern have to step up and begin addressing.
  Let me say, I am going to offer a translation in Spanish.
  (English translation of the statement made in Spanish is as follows:)
  This is not my promise. My promise is that the people of Puerto Rico 
be respected, that we don't treat them as if they were colonized 
slaves. I reject this bill. Let me tell you that my promise is clear: 
to continue my work to defend Puerto Rico. As it is said by the Puerto 
Rican people: precious, it does not matter what tyrant treats you with 
bad intentions, precious you'll be.
  Esta no es mi promesa; mi promesa es que el pueblo de Puerto Rico se 
respete y que no se trate como si fueran colonizados esclavos. Yo 
rechazo esta propuesta, y les digo que mi promesa es clara; de trabajar 
para defender. Porque como se dice pueblo de Puerto Rico preciosa, no 
importa el tirano te trate con negra maldad.
  The Acting CHAIR (Mr. Collins of Georgia). The gentleman from 
Illinois will provide the Clerk a translation of his remarks.
  Mr. BISHOP of Utah. Mr. Chairman, I yield 2 minutes to the gentleman 
from Wisconsin (Mr. Sensenbrenner), one of the cosponsors of this bill.
  Mr. SENSENBRENNER. Mr. Chairman, I went to Puerto Rico in March. I 
have been involved in negotiating this, at the request of the Speaker, 
literally since the first of this year.
  This is difficult. This is something that nobody is happy with. This 
is something where everybody is going to take a haircut because the 
depth of the problem is so bad.
  What we heard right after this Congress began its session this year 
was: Why don't we just give them a super chapter 9 bankruptcy? That 
would have been bad for the future of Puerto Rico, because super 
chapter 9 would have dumped the $72 billion of debt and had it wiped 
out. And there is no way that Puerto Rico, having stiffed $72 billion 
worth of bondholders, would ever have been able to access the bond 
market again.

                              {time}  1630

  Bond market access is essential to any type of State or municipal 
financing.
  So what do we have? A choice of doing nothing, and we have heard 
about the severe consequences if we do nothing, or going with something 
that worked in the District of Columbia, which is the oversight board.
  Now, sure, they are unelected. One of them has to be from Puerto 
Rico. But the Puerto Rican Government, which has been elected, is the 
one that caused this problem to begin with. They have

[[Page 8401]]

increased just about every function of spending on the Island except 
debt service, and they have borrowed more and more and more and more, 
and they don't have the money, or wouldn't appropriate the money to 
service the debt.
  That is why we are here today, and that is what has got to be fixed. 
It should be fixed with an oversight board working in conjunction with 
the Puerto Rican Government, not by a court, or simply by not doing 
anything. It can be fixed, and Puerto Rico can have a renaissance 
because this is about the only practical way out of the mess.
  Mr. GRIJALVA. Mr. Chairman, I yield 2 minutes to the gentlewoman from 
New York (Mrs. Carolyn B. Maloney).
  Mrs. CAROLYN B. MALONEY of New York. Mr. Chairman, I rise in strong 
support of H.R. 5278. This bill is not a perfect bill, but it is a true 
bipartisan compromise, and it is the only option on the table to 
address the crisis in Puerto Rico, which is the home to 3.5 million 
American citizens.
  The solution that this bill adopts is simple: It will allow Puerto 
Rico to restructure its debt in an orderly, court-supervised process 
and, in exchange, a temporary, temporary Federal oversight board will 
help Puerto Rico make the structural reforms necessary to get its 
finances in order and set it on the path of economic growth.
  I would like to truly thank all parties for their hard work on this 
bill, especially Mr. Pierluisi; my good friends from New York, my 
colleagues Representatives Velazquez and Serrano; Ranking Member 
Grijalva; Chairman Bishop; Leader Pelosi; and Antonio Weiss, at the 
Treasury Department.
  New York City, which I represent, has some experience with control 
boards. When we faced a fiscal crisis back in the 1970s, the State 
established two control boards. And while that was a tough pill to 
swallow, in the long run, it made our city better and stronger.
  I would like to emphasize that the solution to New York City's fiscal 
crisis involved a control board, a debt restructuring, and a $2.3 
billion loan from the Federal Government. Puerto Rico isn't getting any 
Federal money at all, so a debt restructuring law is really the least 
we can do to help them.
  Finally, while some opponents of this bill claim on this floor that 
debt restructuring is unnecessary because Congress solved D.C.'s fiscal 
crisis in the nineties with just a control board, this is fundamentally 
untrue.
  The only reason the D.C. Control Board was able to balance D.C.'s 
budget so quickly was because Treasury assumed the District's $4 
billion in pension obligations the year after the Control Board was 
created.
  So a control board by itself is not enough. We need to do more. But I 
urge my colleagues to support this bill.
  Mr. BISHOP of Utah. Mr. Chairman, I yield 3 minutes to the gentleman 
from New Jersey (Mr. MacArthur), who is another Member who has worked 
hard on this particular bill.
  Mr. MacARTHUR. Mr. Chairman, we all know about the crisis in Puerto 
Rico involving 3\1/2\ million U.S. citizens, and we know the causes, 
fiscal mismanagement over decades, resulting in nearly $120 billion of 
bonds and unfunded pension liabilities. Unemployment is two times what 
it is here on the mainland, and people are fleeing Puerto Rico in 
droves, especially young people. It is not sustainable.
  Mr. Chairman, we decided, as a society, hundreds of years ago, that 
we were not going to throw debtors into prison, but we were going to 
allow for the orderly reorganization of debts. And yet, Puerto Rico 
does not have the basic laws that allow that to take place in this 
situation. This bill fixes that.
  This bill puts equal pressure on bondholders, on the island of Puerto 
Rico. The bill will require them to work together or there will be 
consequences. And the bill brings an oversight board to help that 
happen, to even require that to happen. We have to do this.
  But, Mr. Chairman, fixing the debt crisis alone is not going to fix 
Puerto Rico's future. We need growth initiatives. This island will not 
enjoy an enduring prosperity until this Congress also thinks about how 
to help Puerto Rico grow.
  That is why I introduced a title to this bill; it is just a sense of 
Congress, but it puts a flag in the ground saying that we have more 
work to do on growth, and I am really pleased to see a Growth 
Commission included in the bill.
  Mr. Chairman, I have spent a lifetime in business. I have had the 
privilege of creating thousands of jobs. That doesn't happen when you 
have uncertain conditions.
  In 1996, we changed the Tax Code in Puerto Rico that treats the 
return of earnings from that island to the mainland like it is coming 
from a foreign country, and you can watch the growth rate of Puerto 
Rico plummet ever since. Ever since 2006--my date was wrong--2006, you 
can see the growth rate plummet over 10 years.
  Manufacturing is still half of the island's economy and yet, it is 
reduced by half over the last 20 years. We have to do things that make 
Puerto Rico an attractive business environment.
  We all are worried about offshoring. This is an opportunity for near-
shoring in a U.S. territory. It is an opportunity to demonstrate pro-
growth principles in action; to allow Puerto Rico, an island paradise, 
to become an economic miracle.
  This is the opportunity that I see. I am proud of the bill. Like any 
bill, it is not perfect. But let's not let the perfect become the enemy 
of the good. It is a good bill that deserves our support. I urge my 
colleagues to vote ``yes.''
  Mr. GRIJALVA. Mr. Chairman, I yield 1 minute to the gentlewoman from 
California (Ms. Pelosi). Her time and commitment to the people of 
Puerto Rico and to working on a compromise in a bipartisan bill have 
been the primary drivers to this point on the bill that we have before 
us.
  Ms. PELOSI. Mr. Chairman, I rise and commend the leadership of 
Chairman Bishop. I thank the gentleman for bringing us here today, as 
well as our ranking member, Mr. Grijalva, for bringing this compromise 
legislation to the floor.
  It is with the deepest of pride that I join my colleagues, 
Congresswoman Nydia Velazquez and Congressman Jose Serrano, in support 
of this legislation. Although we have concerns about some elements of 
it, we support it on balance.
  I can't help but mention to my colleagues here that in April, many of 
you were there when Congress bestowed the Congressional Gold Medal on 
the legendary 65th Infantry Regiment, a largely Puerto Rican regiment 
that served with valor since World War I.
  Honor et Fidelitas, honor and fidelity, so rings the motto of this 
courageous regiment of Americans. With honor and fidelity, the 65th 
Regiment overcame prejudice and bigotry and wrote a new chapter of 
heroism in our shared American story.
  In the Panama Canal Zone in World War I, on the doorsteps of Nazi 
Germany, in the defining crucible of the Korean War, and beyond, the 
Borinqueneers protected freedom abroad and advanced dignity at home.
  Their daring on the battlefield helped break down the discrimination 
facing Puerto Rican and Latino Americans across our country. They 
enriched our Nation with the strength of their service, through the 
excellence of their example, and the power of their bravery. Their 
valor under fire is nothing short of legendary. The heroic service of 
the Borinqueneers is one of the true great American stories.
  I bring this to mind because on that day in Emancipation Hall, which 
was crowded with people, and the presentations were led by the 
bipartisan, bicameral House and Senate, Democrat and Republican 
leadership who had representatives of our military to salute the 
bravery of these people of Puerto Rico in defense of our country.
  Now we have nearly 100,000 veterans in Puerto Rico who will be 
affected, harmed, unless we act today. Today, more than 3 million of 
our fellow American citizens in Puerto Rico are facing a fiscal and 
public debt emergency that threatens their economy, their communities, 
and their families. Only Congress can provide Puerto Rico with the 
tools it needs to emerge from this crisis.

[[Page 8402]]

  After long bipartisan negotiations, we achieved a restructuring 
process that meets the test of workability. Does it work? Will it 
happen?
  This is not a bailout. Some people are trying to describe it as such 
for some other purposes. I know that my colleague from Puerto Rico, 
Pedro Pierluisi, has explained to us the urgency of this. I know that 
we would have, perhaps, had a bill that didn't have some of the 
provisions in it that are in it, and we would have preferred to add 
some better things to the bill, but that is not the choice before us.
  As legislators, we have to make a choice: will the bill alleviate the 
challenge that the people of Puerto Rico are facing? Our Resident 
Commissioner, Pedro Pierluisi, thinks that this bill does achieve that, 
and I thank him for his courageous leadership on all of this.
  Again, this can be a very passionate discussion. It is an emotional 
one because it involves the lives of people that some of us know and 
are part of the families of our Members, as Jose Serrano and Nydia 
Velazquez mentioned. But we have to be dispassionate in how we make a 
judgment about how we can solve the problem, and we have that 
opportunity today.
  The oversight board that President Obama will appoint is one that 
will have the opportunity to implement the restructuring as described 
in this legislation. On a bipartisan basis, we will be submitting names 
to the President promptly so that he can appoint the oversight board.
  It would be my commitment to make sure that the commitment from the 
House Democrats is for there to be one from Puerto Rico representing 
the people of Puerto Rico on that board.
  In addition to the oversight board, this legislation also contains a 
task force, a Members' task force whose task it is to look at 
impediments in Federal law to Puerto Rico's economic growth. I would 
hope that that task force would afford us the opportunity to see other 
ways that we can help the economic growth of Puerto Rico, for the 
citizens, our fellow citizens in Puerto Rico.
  We can talk about parity in relationship to Medicare, Medicaid, and 
the rest. We can talk about the earned income tax credit, which we 
enjoy in the United States, and having that be more available in Puerto 
Rico. We can talk about ways to use the Tax Code to give more 
opportunity there.
  So I urge my colleagues to support the legislation. Even though it is 
not the bill that either one side would have written, it is a 
compromise. But it will provide the people of Puerto Rico the tools to 
overcome the crisis and move forward, hundreds of millions of dollars, 
maybe $1 billion a year. It will alleviate Puerto Rico from having to 
commit, because of the restructuring, and will enable it to meet the 
needs of the people of Puerto Rico as it gets back on its feet.
  Puerto Rico's economic success is important to the United States. Our 
economic growth and job creation plans must include our fellow citizens 
in Puerto Rico. I would hope, with the task force; I would hope with 
future legislation, as we go forward, we will recognize how close our 
connection is, how important it is for Puerto Rico to survive, and 
express our gratitude to the people of Puerto Rico for the vitality 
they bring to the United States of America, and for the security that 
so many Puerto Ricans risk their lives to protect our country.
  With that, I urge our colleagues to pray over it and conclude, as our 
three colleagues, Congresswoman Velazquez, Congressman Serrano, 
Congressman Pierluisi have concluded, that, on balance, we must move 
forward for the benefit of the veterans, for the people, for their 
children, for the citizens of Puerto Rico.
  I urge an ``aye'' vote.
  Mr. BISHOP of Utah. Mr. Chairman, I yield myself 4 minutes.
  I appreciate the comments that have been made so far on a bill that I 
want to think actually has a lot of good in it.

                              {time}  1645

  Article 4, section 3 of the Constitution provides Congress not only 
the power, but also the responsibility to do what is needful dealing 
with the territories.
  As a matter of fact, Mr. Chairman, just this morning, the Supreme 
Court ruled on a case concerning the territory and a question of double 
jeopardy. By a 6-2 decision, the Court held that Puerto Rico is not a 
separate sovereignty because the ultimate source of its power and its 
constitution is the United States Congress. So, indeed, this reminds us 
all here today of our duty to assist in the territorial issues.
  Now, there are seven titles to this particular piece of legislation. 
The first two deal with the oversight board that will bring fiscal 
plans and a budget to the island. Titles III and VI deal with 
restructuring of the debt if certain criteria are met in the oversight 
board's discretion that it include good-faith debt negotiations with 
its creditors.
  Title V is something I think we sometimes overlook because it gives 
fast-track authority for vital infrastructure projects to be moved by 
the government of Puerto Rico, especially in the area of energy 
generation and distribution systems. One of the problems of Puerto Rico 
is the high energy costs that have caused them to lose jobs. What we 
are attempting to do is trying to find a way of changing that problem 
and reducing Puerto Rico's reliance on diesel fuel to generate their 
electricity. That is one of the parts of this bill that is extremely 
important and I think is overlooked sometimes. The final title I am 
happy about because that has pro-growth portions and reforms in it.
  But let it be very clear: this is a conservative bill that is rooted 
in the Constitution that does not cost the American taxpayers a dime. 
It is not a bailout. It does not expand the size or scope of the 
Federal Government, and it does not encroach on State authority.
  In fact, I think we have done a pretty good job in trying to solve 
some problems in a way that can move everyone forward.
  At this point, I also want to thank the chairmen of the Committee on 
Education and the Workforce and the Committee on the Judiciary and 
Small Business Committee for their help with this particular bill, so 
especially Chairman Kline, Chairman Goodlatte, and Chairman Chabot. I 
do appreciate their help on this particular bill.
  Mr. Chairman, I reserve the balance of my time.

                                         House of Representatives,


                               Committee on Natural Resources,

                                     Washington, DC, May 25, 2016.
     Hon. Steve Chabot,
     Chairman, Committee on Small Business,
     Washington, DC.
       Dear Mr. Chairman: On May 25, 2016, the Committee on 
     Natural Resources ordered favorably reported as amended H.R. 
     5278, the Puerto Rico Oversight, Management, and Economic 
     Stability Act. The bill was referred primarily to the 
     Committee on Natural Resources, with an additional referral 
     to the Committee on Small Business, among other committees.
       I ask that you allow the Committee on Small Business to be 
     discharged from further consideration of the bill so that it 
     may be scheduled by the Majority Leader. This discharge in no 
     way affects your jurisdiction over the subject matter of the 
     bill, and it will not serve as precedent for future 
     referrals. In addition, should a conference on the bill be 
     necessary, I would support your request to have the Committee 
     on Small Business represented on the conference committee. 
     Finally, I would be pleased to include this letter and any 
     response in the bill report filed by the Committee on Natural 
     Resources to memorialize our understanding, as well as in the 
     Congressional Record.
       Thank you for your consideration of my request, and I look 
     forward to further opportunities to work with you this 
     Congress.
           Sincerely,
                                                       Rob Bishop,
     Chairman.
                                  ____

                                         House of Representatives,


                                  Committee on Small Business,

                                     Washington, DC, May 25, 2016.
     Hon. Rob Bishop,
     Chairman, Committee on Natural Resources, Washington, DC.
       Dear Mr. Chairman: I am writing regarding H.R. 5278, the 
     Puerto Rico Oversight, Management and Economic Stability Act. 
     The bill contains a provision that is within the jurisdiction 
     of the Committee on Small Business.

[[Page 8403]]

       I recognize and appreciate your desire to bring this bill 
     before the House of Representatives in an expeditious manner. 
     Accordingly, I will agree that the Committee on Small 
     Business be discharged from further consideration of the 
     bill. I do so with the understanding that this action does 
     not affect the jurisdiction of the Committee on Small 
     Business, and that the Committee expressly reserves the right 
     to seek conferees on any provision within its jurisdiction 
     during any House-Senate conference that may be convened on 
     this or any similar legislation. I would ask that you support 
     any such request.
       I also ask that a copy of this letter be included in the 
     Congressional Record during the consideration of H.R. 5278 on 
     the House floor.
       Thank you for your consideration and for your work on this 
     legislation.
           Sincerely,
                                                     Steve Chabot,
     Chairman.
                                  ____

                                         House of Representatives,


                               Committee on Natural Resources,

                                     Washington, DC, May 31, 2016.
     Hon. John Kline,
     Chairman, Committee on Education and the Workforce, 
         Washington, DC.
       Dear Mr. Chairman: On May 25, 2016, the Committee on 
     Natural Resources ordered favorably reported as amended H.R. 
     5278, the Puerto Rico Oversight, Management, and Economic 
     Stability Act. The bill was referred primarily to the 
     Committee on Natural Resources, with an additional referral 
     to the Committee on Education and the Workforce, among 
     others.
       I ask that you allow the Committee on Education and the 
     Workforce to be discharged from further consideration of the 
     bill so that it may be scheduled by the Majority Leader. This 
     discharge in no way affects your jurisdiction over the 
     subject matter of the bill, and it will not serve as 
     precedent for future referrals. In addition, should a 
     conference on the bill be necessary, I would support your 
     request to have the Committee on Education and the Workforce 
     represented on the conference committee. Finally, I would be 
     pleased to include this letter and any response in the bill 
     report filed by the Committee on Natural Resources to 
     memorialize our understanding, as well as in the 
     Congressional Record.
       Thank you for your consideration of my request, and I look 
     forward to further opportunities to work with you this 
     Congress.
           Sincerely,
                                                       Rob Bishop,
     Chairman.
                                  ____

                                            Committee on Education


                                            and the Workforce,

                                     Washington, DC, May 31, 2016.
     Hon. Rob Bishop,
     Chairman, Committee on Natural Resources, Washington, DC.
       Dear Mr. Chairman: I am writing to confirm our mutual 
     understanding with respect to H.R. 5278, the Puerto Rico 
     Oversight. Management, and Economic Stability Act. Thank you 
     for consulting with the Committee on Education and the 
     Workforce with regard to H.R. 5278 on those matters within 
     the Committee's jurisdiction.
       In the interest of expediting the House's consideration of 
     H.R. 5278, the Committee on Education and the Workforce will 
     forgo further consideration of this bill. However, I do so 
     only with the understanding this procedural route will not be 
     construed to prejudice my Committee's jurisdictional interest 
     and prerogatives on this bill or any other similar 
     legislation and will not be considered as precedent for 
     consideration of matters of jurisdictional interest to my 
     Committee in the future. Additionally, I appreciate your 
     committee's assistance with any additional improvements to 
     the bill within the jurisdiction of the Education and the 
     Workforce Committee.
       I respectfully request your support for the appointment of 
     outside conferees from the Committee on Education and the 
     Workforce should this bill or a similar bill be considered in 
     a conference with the Senate. I also request you include our 
     exchange of letters on this matter in the Committee Report on 
     H.R. 5278 and in the Congressional Record during 
     consideration of this bill on the House Floor. Thank you for 
     your attention to these matters.
           Sincerely,
                                                       John Kline,
     Chairman.
                                  ____

                                         House of Representatives,


                               Committee on Natural Resources,

                                     Washington, DC, May 31, 2016.
     Hon. Bob Goodlatte,
     Chairman, Committee on the Judiciary, Washington, DC.
       Dear Mr. Chairman: On May 25, 2016, the Committee on 
     Natural Resources ordered favorably reported as amended H.R. 
     5278, the Puerto Rico Oversight, Management, and Economic 
     Stability Act. The bill was referred primarily to the 
     Committee on Natural Resources, with an additional referral 
     to the Committee on the Judiciary, among others.
       I ask that you allow the Committee on the Judiciary to be 
     discharged from further consideration of the bill so that it 
     may be scheduled by the Majority Leader. This discharge in no 
     way affects your jurisdiction over the subject matter of the 
     bill, and it will not serve as precedent for future 
     referrals. In addition, should a conference on the bill be 
     necessary, I would support your request to have the Committee 
     on the Judiciary represented on the conference committee. 
     Finally, I would be pleased to include this letter and any 
     response in the bill report filed by the Committee on Natural 
     Resources to memorialize our understanding, as well as in the 
     Congressional Record.
       Thank you for your consideration of my request, and I look 
     forward to further opportunities to work with you this 
     Congress.
           Sincerely,
                                                       Rob Bishop,
     Chairman.
                                  ____

                                         House of Representatives,


                                   Committee on the Judiciary,

                                     Washington, DC, June 2, 2016.
     Hon. Rob Bishop,
     Chairman, Committee on Natural Resources, Washington, DC.
       Dear Chairman Bishop: I am writing with respect to H.R. 
     5278, the ``Puerto Rico Oversight, Management, and Economic 
     Stability Act,'' which was referred to the Committee on 
     Natural Resources and in addition to the Committee on the 
     Judiciary among other committees. As a result of your having 
     consulted with us on provisions in H.R. 5278 that fall within 
     the Rule X jurisdiction of the Committee on the Judiciary, I 
     agree to discharge our committee from further consideration 
     of this bill so that it may proceed expeditiously to the 
     House floor for consideration.
       The Judiciary Committee takes this action with our mutual 
     understanding that by foregoing consideration of H.R. 5278 at 
     this time, we do not waive any jurisdiction over subject 
     matter contained in this or similar legislation and that our 
     committee will be appropriately consulted and involved as 
     this bill or similar legislation moves forward so that we may 
     address any remaining issues in our jurisdiction. Our 
     committee also reserves the right to seek appointment of an 
     appropriate number of conferees to any House-Senate 
     conference involving this or similar legislation and asks 
     that you support any such request.
       I appreciate your May 31, 2016, letter confirming this 
     understanding with respect to H.R. 5278 and would ask that a 
     copy of our exchange of letters on this matter be included in 
     your committee report and in the Congressional Record during 
     Floor consideration of H.R. 5278.
           Sincerely,
                                                    Bob Goodlatte,
                                                         Chairman.

  Mr. GRIJALVA. I yield myself the balance of my time, and thank Leader 
Pelosi and my colleague, Chairman Bishop, his staff, and certainly 
staff on our side of the aisle for their hard work.
  It is a bill that is indeed a compromise, and we shouldn't be ashamed 
of that. It is a compromise that I wish was more tilted on our side and 
the things that we wanted. But, Mr. Chairman, those are not the 
dynamics or the numbers in this House.
  The reality is that the urgency of Puerto Rico, the humanitarian 
demands and needs of the island make us look at this bill not with an 
eye towards perfection, but with an eye toward what is doable and what 
can provide some immediate relief and begin the process of stability 
for the island and for its people, and begin the process of an economic 
renewal for the island itself.
  I want to also acknowledge my colleagues, Mr. Pierluisi, Ms. 
Velazquez, and Mr. Serrano. I know how difficult this vote was and how 
difficult it is to vote on a compromise that does not fully empower and 
fully acknowledge the self-governance of the Puerto Rican people. I 
know that. But your endorsement of this bill is very meaningful in that 
it ties us to a heritage of representation by the Puerto Rican people 
in this body and to insisting and demanding that the needs of the 
people of Puerto Rico be recognized fully by this Congress. We 
recognize them today, as Mr. Serrano said, but there is much, much more 
to do.
  This vote, by the way, as I close, is not about heritage. More 
importantly, it is not about selling out one's heritage. It is about 
future generations and the opportunities they will have on the island. 
It is about stability for children, families, and the elderly with a 
fiscally stable economy and an accountable fiscal system within the 
island.
  While I can understand the political expediency of voting ``no,'' I 
think the demands and the urgency to deal with

[[Page 8404]]

this question compel me--and I hope all my colleagues in this body--to 
vote ``yes.''
  Mr. Chairman, I yield back the balance of my time.
  Mr. BISHOP of Utah. I yield 4\1/2\ minutes to the gentleman from 
Louisiana (Mr. Graves), another member of our committee.
  Mr. GRAVES of Louisiana. Mr. Chairman, I first want to thank Chairman 
Bishop, Ranking Member Grijalva, Congressmen Labrador, Duffy, and 
Pierluisi, and many others who worked tirelessly on this legislation.
  Mr. Chairman, the island of Puerto Rico with a population of under 4 
million people has a debt of, by some measure, $100 billion. That is a 
population less than the State of Louisiana, but a debt of nearly $100 
billion.
  We have three options: We can do nothing and continue to allow this 
island territory to continue spiraling downward in a financial and 
humanitarian crisis. We can provide financial oversight. We can relieve 
regulation, help to reignite the economy, and allow for a negotiation 
between the creditors and the debtor. Or we can pay off their debt and 
add to the already $19 trillion irresponsible debt of the American 
Government today. Those are the options that are out there.
  I will tell you, I also struggled with what the right conservative 
solution was in this case.
  Ultimately, there is just one right answer. Doing nothing will simply 
worsen the financial condition, will probably put more burden on us to 
actually bail out the Nation on Congress and on the White House to do 
that. I oppose a bailout, and I oppose putting taxpayer dollars on the 
hook to pay off nearly a dozen years of irresponsible spending of the 
Puerto Rican Government.
  So establishing a financial oversight board similar to what was done 
in Washington, D.C. and providing conditions to negotiate a solution is 
the right answer. It is the conservative solution.
  During committee consideration of the bill, I included an amendment 
to ensure that Federal taxpayers are not put on the hook for this 
liability.
  Section 210 says: ``No Federal funds shall be authorized by this act 
for the payment of any liability of the territory or territorial 
instrumentality.''
  The Acting CHAIR. The time of the gentleman has expired.
  Mr. BISHOP of Utah. Mr. Chairman, I yield the gentleman an additional 
30 seconds.
  Mr. GRAVES of Louisiana. Mr. Chairman, this amendment makes it clear: 
as affirmed by the Supreme Court today and mentioned by the committee 
chairman, Puerto Rico is different from a State, and the Supreme Court 
affirmed that today. It is not a State. It is a territory of the U.S., 
and we have a constitutional obligation to prevent a worsening 
disaster.
  This bill does not set a precedent for States and municipalities. It 
respects the priority of debt by general obligation bondholders and 
others. It prevents higher cost of borrowing by States and 
municipalities by controlling the situation. Most importantly, Mr. 
Chairman, it doesn't bail out Puerto Rico. It creates a path for 
financial stability.
  Mr. Chairman, I urge support for H.R. 5278.
  Mr. BISHOP of Utah. Mr. Chairman, I yield 1 minute to the gentleman 
from New Jersey (Mr. Garrett).
  Mr. GARRETT. Mr. Chairman, I come before the House today to support 
an important piece of legislation that will allow the people of Puerto 
Rico a path towards economic stability, growth, and prosperity.
  Beholden to out-of-control tax-and-spend policies, the Puerto Rican 
people are experiencing the harsh realities of fiscal irresponsibility 
and unaccountable government. That is why I strongly support this bill.
  We have a moral and constitutional responsibility to address this 
fiscal crisis which will only get worse if we don't act. That is why I 
support this bill and what we must learn from this experience.
  Congress and Presidents of both parties have let our national debt 
reach an unsustainable $19 trillion. That is only because the U.S. 
Government has something that Puerto Rico doesn't have: the ability to 
print money and borrow endlessly. So that is why I support the fiscal 
reforms in this bill which do not spend a single dollar in U.S. 
taxpayer money to relieve Puerto Rico of its debt.
  I have long opposed taxpayer bailouts. Fortunately, this bill 
prevents the taxpayers from bailing out a government that spent 
recklessly and provides a conservative solution to force Puerto Rico to 
spend now responsibly. The bill also avoids setting a horrible 
precedent that could tempt free-spending States to walk away from their 
obligations by behaving irresponsibly.
  The Acting CHAIR. The time of the gentleman has expired.
  Mr. BISHOP of Utah. Mr. Chairman, I yield the gentleman an additional 
30 seconds.
  Mr. GARRETT. Most importantly, the bill creates a seven-member 
oversight board to oversee their debt restructuring and to conduct 
financial audits. What would this board do? It would require 
commonsense actions like sustainable government programs to establish 
fiscal plans to achieve needed reform and so on. This bipartisan bill 
is the first step to return Puerto Rico to solvency and stability.
  Americans, each and every day, balance their own checkbooks and live 
within their own means. Politicians and government bureaucrats should 
behave no differently. I therefore support the underlying legislation.
  Mr. BISHOP of Utah. Mr. Chairman, I yield 1\1/2\ minutes to the 
gentlewoman from Wyoming (Mrs. Lummis). She is the vice-chair of the 
committee.
  Mrs. LUMMIS. Mr. Chairman, we saw a bunch of ads on TV about this 
bill and about what it would do to the bondholders. So I did some 
research.
  I rise in support of this bill as one of the more conservative 
members of the Republican wing of this House. The reason I support it 
is the research I did showed me that it wasn't this widow that bought 
these bonds, it was large institutional investors. It was investors who 
knew what they were buying because they read the disclosure documents. 
It was investors who buy billions of dollars worth of bonds, and they 
are trying to diversify those portfolios, so they have some high-risk, 
high-return investments and some low-risk, low-return investments. They 
have different maturity dates. They come from different jurisdictions. 
They are trying to have a balanced portfolio. Those portfolios were 
purchased recognizing that some of these bonds might have a higher risk 
and a higher return. That higher return comes at a discounted price. So 
they paid a discount in hopes that they would get the higher return and 
that these bonds would hold up.
  Quite frankly, those bondholders knew what they were getting because 
it was even disclosed in the bond documents that Congress might be here 
today debating this very problem of the island's inability to repay 
everything.
  Not all general obligation bonds are created equal. The bond 
purchasers knew what they were getting. This bill is going to allow for 
the relative-to-each-other agreement among the bondholders about how to 
treat the bonds.
  Mr. Chairman, I fully support the bill.
  Mr. BISHOP of Utah. Mr. Chairman, I yield 1 minute to the gentleman 
from Wisconsin (Mr. Ryan). He also has the title of Speaker of the 
House.
  Mr. RYAN of Wisconsin. Mr. Chairman, it is vital that we pass this 
bill. Let me tell you why. Puerto Rico is in trouble, and we need to 
act now before that trouble threatens taxpayers.
  Let me explain why. Puerto Rico's government owes $118 billion in 
bonds and in unfunded pension liabilities. It has already defaulted on 
much of it. Things are only going to get worse.
  Now the island is shutting down. You can see it in the news--closed 
schools, and hospitals are beginning to close. That is today. Tomorrow 
it could be policemen without cars. It could be blackouts at hospitals. 
This is a humanitarian disaster in the making. What is worse, if we do 
nothing, it could be a manmade humanitarian disaster.

[[Page 8405]]

  I know this goes without saying, but it is worth repeating: the 
Puerto Rican people are our fellow Americans. They pay our taxes. They 
fight in our wars. We cannot allow this to happen.
  I should also say that if we do nothing, the contagion will simply 
spread. About 15 percent of Puerto Rico's debt is already held by 
middle class Americans, and if the government can't meet its 
obligations, these families will pay the price--or even worse, 
taxpayers could be asked to bail it out.

                              {time}  1700

  That is simply unacceptable. That is why we are taking action now, to 
prevent a bailout and to help the Puerto Rican people.
  What this bill will do is allow Puerto Rico to restructure its debts 
and set up an oversight board that will oversee this process. Congress 
and the President will appoint the members of this board. It will audit 
Puerto Rico's books and make sure the restructuring is open and fair. 
It will also make sure the restructuring honors the agreements. It will 
make sure the government changes its ways so we don't have to do this 
again.
  Let me set a few things straight. Some people say this will set a bad 
precedent. Some people say this will encourage reckless spending by the 
States. No, absolutely not. The bill applies only to territories and 
not to States.
  I also want to point one other thing out. The Puerto Rican Government 
is not getting off scot-free here. Not at all. It has not served the 
Puerto Rican people well. It has spent money recklessly for decades.
  This legislation will make sure that the government balances its 
budget. It will make sure that they pass reforms that will grow the 
Puerto Rican economy. It gives flexibility on the youth minimum wage so 
businesses will hire more young people.
  I also hear people say that this is a bailout. That is absolutely, 
categorically, undeniably false. This bill won't add a single dollar to 
the deficit. All you have to do is look at the Congressional Budget 
Office. Not a single taxpayer dollar added to the deficit.
  This bill prevents a bailout. That is the entire point. Let me tell 
you this: if we do not pass this bill, then there is much more likely 
going to be a bailout because there will be no other choice. But if we 
pass this bill, Puerto Rico will get a handle on its debt. Its economy 
will begin to grow. The people in Puerto Rico will see that help is on 
the way and there is a reason to stay because they are finally getting 
their act together. Taxpayers will be safe.
  I am telling all Members right now, the best chance to get this right 
is to pass this bill. The best chance for creditors to get what they 
are owed is this bill. This is our responsibility. The Constitution is 
really clear. The Constitution gives Congress the duty to oversee 
legislation for all U.S. territories. Now it is time that we do our 
constitutional duty.
  A lot of people have spent so much time on this legislation. Here is 
what we are doing. If we see a problem among our fellow citizens and it 
is in a territory where we have a constitutional responsibility, we 
have to address this problem, and we have to address this problem in a 
smart way so that we prevent the taxpayer from getting involved, we 
have to address this problem in a smart way so that we prevent any 
contagion from occurring in the bond markets, and we have to address 
this problem in a smart way so that Puerto Rico can get back on its 
feet again, so that the future for the people in Puerto Rico is a 
brighter future.
  There are so many people who have poured their hearts into this. I 
want to thank Rob Bishop from Utah, the chairman of the committee; I 
want to thank Sean Duffy from Wisconsin; I want to thank Raul Labrador 
from Idaho; I want to thank Jim Sensenbrenner from Wisconsin; I want to 
thank Pedro Pierluisi from Puerto Rico; and I want to thank the Members 
from the other side of the aisle who put so much time into this.
  This is a bipartisan bill. This is the best solution in a deepening 
crisis. This bill has my full support. I urge all of my colleagues in 
the House to give it their full support as well.
  Mr. BISHOP of Utah. Mr. Chairman, I yield myself the balance of my 
time.
  Six months ago, our committee began the effort to try to solve this 
problem. We had four hearings, countless stakeholder meetings, and got 
input from expert testimony. Interested parties from all over the place 
were able to get their input in various drafts of this bill. It was an 
exhaustive effort, but what happened is at the end of this time we had 
a good bill. That is the way this process is supposed to work.
  It is a bill that is rooted in the Constitution, it doesn't cost the 
taxpayers, it provides Puerto Rico with the tools to impose discipline 
over its finances, and led towards an element of prosperity.
  In Spanish, I am told that the phrase promesa means promise. This 
bill is a promise for Puerto Rico for a better life. It is the way we 
go forward.
  I urge everyone's adoption of a great piece of legislation.
  I yield back the balance of my time.
  Mr. HINOJOSA. Mr. Chair, today I rise in support of H.R. 5278, the 
``Puerto Rico Oversight, Management, and Economic Stability Act'' 
(PROMESA)--a bipartisan bill providing short-term relief to respond to 
the humanitarian crisis facing the people of Puerto Rico.
  Mr. Chair, Puerto Rico's faltering economy and the well-being of its 
more than 3.4 million people are of great concern to may colleagues and 
me. The island's $70 billion debt has made it extremely difficult for 
the Commonwealth to provide adequate health care, education and public 
safety for the people of Puerto Rico.
  As a result, its people are struggling to access basic public 
services--as schools and hospitals face daily electricity and water 
shortages. I am deeply concerned that the island's health care systems 
have been adversely affected by Puerto Rico's debt crisis, making it 
increasingly difficult to handle a Zika outbreak or other health 
crises.
  As a senior member of the Financial Services Committee, I support 
giving Puerto Rico all the tools necessary to restore its access to 
credit markets and restructuring its outstanding debt. These critically 
important measures will help restore its financial footing.
  I do not support certain provisions in the bill, including sections 
undermining a minimum wage and protections for pension benefits. 
However, it is my hope that this bill on balance will help Puerto Rico 
stave off catastrophe by restoring basic services, with the hope of 
putting Puerto Rico back on the path toward improving the quality of 
life of its people.
  In closing, Mr. Chair, I urge my colleagues on both sides of the 
aisle to support H.R. 5278. This bill is not perfect, but it takes a 
step in the right direction.
  Ms. BORDALLO. Mr. Chair, I am disappointed that two amendments I 
offered yesterday at the Rules Committee were not made in order for 
debate on H.R. 5278, the Puerto Rico Oversight, Management, and 
Economic Stability Act (PROMESA). These amendments, along with 
amendments offered by Rep. Kilili Sablan of the Northern Mariana 
Islands on the Earned Income Tax Credit and Rep. Amata Radewagen of 
American Samoa on the Child Tax Credit, would have addressed underlying 
issues that are experienced in all the territories and that contributed 
to Puerto Rico's debt crisis. We had a chance to address legacy policy 
issues that unduly put a significant financial strain on our local 
treasuries, yet we were denied an opportunity to more fully debate 
these issues and be afforded an up or down vote.
  My first amendment would have granted the government of Guam 
flexibility to extend Social Security to all new government hires. The 
Government of Guam's (GovGuam) current retirement plan will leave many 
without sufficient means when they retire. As you know, the pension 
shortfall in Puerto Rico was a key contributor to its current fiscal 
crisis and local leaders in Guam are working proactively to enact 
legislation to prevent a similar situation in Guam. Part of their 
efforts is contingent on enrolling employees in Social Security, and my 
amendment would give GovGuam flexibility to enroll new hires in Social 
Security as it works to address retirement shortfalls for its current 
workforce. The Social Security Actuaries and the CBO have indicated 
that the amendment would have a net positive increase on federal 
revenues. I offered a practical, common sense solution that is 
supported by many on Guam. It was a proactive attempt to provide 
GovGuam with the tools it needs to address this systemic issue.

[[Page 8406]]

  My second amendment would have granted equitable treatment to the 
U.S. territories in carrying out the Medicaid program. The amendment 
would have eliminated the Medicaid caps on the territories and provide 
parity with the federal medical assistance percentage in force in the 
territories. The inequitable treatment of the territories in Medicaid 
has caused significant financial strain on our local governments and 
has forced us to contribute a disproportionate share of local dollars 
when compared to the 50 states and DC. This was a bipartisan amendment 
supported by all representatives of the territories, and it would have 
put our constituents, who are all Americans, on equal footing with 
those who reside in the States. The cost of providing health care in 
our jurisdictions, particularly on Guam, inhibits our economies from 
truly developing. Further, this amendment was modeled off a request 
contained in President Obama's Fiscal Year 2017 budget request which 
would have eliminated the caps and put the territories on a path to 
improving their FMAP. This budget proposal is a critical component of 
solving the crisis we see in Puerto Rico yet we have been denied a 
chance to address this matter on the floor. We have an opportunity to 
address this inequity, and I feel it is critical that we act with 
purpose on this matter.
  I also want to underscore my disappointment that amendments submitted 
by my colleagues, Mr. Sablan and Ms. Radewagen were also not made in 
order. We firmly believe that Puerto Rico's debt crisis cannot be 
resolved through debt restructuring alone. This debt crisis was caused 
by underlying issues which have been impacted by the unequal treatment 
of the territories in certain federal programs. Again, like with 
Medicaid, addressing these issues for Puerto Rico and the other 
territories would help lift a burden and allow our local governments to 
focus more on economic development and improving infrastructure to 
support those new economies.
  Together our amendments addressed disparities in Medicaid and the 
application of the Earned Income Tax Credit and the Child Tax Credit, 
and would have fixed critical issues that contributed to Puerto Rico's 
debt crisis. We offered these amendments because while Guam's and the 
other territories' fiscal situations are nowhere near the crisis in 
Puerto Rico, we had an opportunity to be proactive and eliminate 
federal policies and programs that are not treating the territories 
with equity. Put more simply, we could have been proactive in 
addressing federal law to ensure our other territories are put in a 
better shape financially.
  We simply do not believe that extending the authorities proposed in 
PROMESA without addressing continued systemic challenges will resolve 
Puerto Rico's problems, nor will it provide a more secure financial 
footing in all the territories. I recognize the political challenges 
that have been undertaken to get this bill to the point that we are at 
right now. However, we need to find the political will to address the 
systemic challenges now, before they become crises later. We are doing 
all we can to be proactive so that what is happening to Puerto Rico 
does not happen to the rest of us. I hope this Congress will address 
these issues so that we can bring parity to the millions of Americans 
living in the territories and enable the territories' local governments 
to focus on programs that will enhance their economies.
  Mr. SMITH of Texas. Mr. Chair, House Resolution 5278 creates a board 
of managers to address the fiscal condition of Puerto Rico.
  However, Puerto Rican officials still have not been held accountable 
or accepted responsibility for their policies that caused the financial 
crisis. In fact, just the opposite: the Puerto Rican government ignored 
its fiscal obligations when it recently voted to approve a moratorium 
on repaying any of its debt.
  But it is Puerto Rico and not Congress who should take the first 
steps to adopt reform measures.
  There is no certainty that a financial oversight board would 
implement any economic growth measures to improve the Island's fiscal 
condition.
  The board has no mandate from Congress to address the bloated 
government workforce, high taxes, an insolvent pension system, 
limitations on trade under the Jones Act, and excessive welfare 
benefits, all of which helped cause the fiscal crisis.
  This legislation rewards bad behavior and represents a missed 
opportunity for Congress to insist on fiscally responsible reforms.
  Mr. CONYERS. Mr. Chair, I rise today because Puerto Rico is 
confronting a catastrophe. The spiral of recession, emigration, debt, 
and austerity has left the island in dire straits. Puerto Rico faces 
immediate default on a large portion of its debt and the island might 
have to halt emergency services if it cannot obtain further credit.
  This crisis has been developing for a long time, but the problem has 
grown increasingly unworkable over the past year while this Congress 
has done nothing. The potential humanitarian consequences of continuing 
to do nothing have convinced me that despite my grave concerns about 
what I consider a mere half-measure, I must support PROMESA, the Puerto 
Rico Oversight, Management, and Economic Stability Act (H.R. 5278).
  Puerto Rico's problems go beyond short-term debt service. Federal 
changes to their unique tax structure have helped push the territory 
into recession for a decade, which in turn has driven massive 
emigration elsewhere, which harms their ability to attract investment 
and fair financing, which has only further imperiled the Island's 
fiscal situation. It is the very definition of an austerity driven 
destructive cycle.
  Correcting its course is no easy task, but Puerto Rico can succeed if 
they receive two necessary things: time and support.
  First, an immediate stay on debt collection and payments that would 
allow time to develop a negotiated resolution, or absent that a 
bankruptcy process that treats creditors equitably. All creditors 
should expect to shoulder some of the pain, but nobody should take 
unfair losses--least of all the pensioners who can least afford an 
unequal burden.
  Second, an economic development plan that reflects Puerto Rico's 
unique challenges, like emigration to the mainland, which hinder the 
island's ability to rebuild its tax base and attract new investment. 
Alternative energy programs and tax incentives should be supported to 
encourage a more self-sufficient economy. Public health efforts should 
be directed to the island in order to evaluate growing problems that 
disproportionately affect Puerto Rico, such as Zika.
  PROMESA, while well intentioned, simply may not fully address the 
magnitude of Puerto Rico's problems. Without an adequate commitment to 
improving economic stability on the island, talented residents will 
continue emigrating elsewhere, industry will further wither because of 
substandard public services, and local fiscal problems will likely 
escalate. Further, the ridiculous riders that potentially undercut wage 
and overtime protections--as well as environmental regulations--
represent a cynical effort to take advantage of the Island's desperate 
situation. It is a shameful reminder that many in this body see Puerto 
Rico as a colony unworthy of the privileges we enjoy on the mainland.
  I am voting for PROMESA despite my serious concerns because I hope 
against hope that it will be improved in the Senate. A real recovery 
strategy--one that gives residents, workers, and pensioners a viable 
future--is what Puerto Rico needs and deserves.
  Ms. JACKSON LEE. Mr. Chair, I stand before you today to discuss H.R. 
5278--Puerto Rico Oversight, Management, and Economic Stability Act 
(PROMESA).
  Our consideration of PROMESA must be a very thoughtful analysis of an 
outcome where the people of Puerto Rico will be empowered and be on a 
path towards progress where working families, their children and 
pensioners can be on a pathway towards a better future.
  PROEMSA is a bipartisan measure and effort to assist the Commonwealth 
of Puerto Rico in restructuring $70 billion in currently unpayable 
debt, an amount that exceeds the size of its entire economy.
  There are a total of 3.548 million people living on the island of 
Puerto Rico.
  Since 2006, Puerto Rico's economy has shrunk by more than 10 percent 
and shed more than 250,000 jobs.
  More than 45 percent of the Commonwealth's residents live in 
poverty--the highest poverty rate of any state or territory.
  Furthermore, its 11.6 percent unemployment rate is more than twice 
the national level.
  The challenges facing the people of Puerto Rico have ignited the 
largest wave of outmigration since the 1950's, and the pace continues 
to accelerate.
  More than 300,000 people have left Puerto Rico in the past decade 
with a record of 84,000 people leaving in 2014.
  Puerto Ricans suffer from high rates of forced migration due to the 
better opportunities offered in the United States compared to in the 
commonwealth.
  The gap between emigrants and immigrants has been continuously 
widening.
  Indeed, this increase in emigrants caused a population decline, the 
first in its history, and the stateside Puerto Rican population grew 
quickly.
  The median age of male Puerto Ricans is of working age from the ages 
of 25-49 and similarly for women from the ages of 25-59.
  Most of the homes are family-led.
  There are about 1,133,600 people in the civilian labor force but only 
43 percent of them are employed.

[[Page 8407]]

  In addition, most of those working work in minimum wage jobs.
  Over 27 percent of the people in the Commonwealth are on welfare.
  The median income in Puerto Rico is only half that of the poorest 
U.S. state, Mississippi, but welfare benefits are about the same in 
Puerto Rico as in Mississippi.
  Swift action is needed in order to alleviate the pain and suffering 
of the people of Puerto Rico.
  There is no time to waste.
  H.R. 5278 appears to be an emergency default for Puerto Rico, an 
American territory where 3.5 million American citizens reside and 
continue to live in fear for their finances, their families and their 
future.
  On July 1, Puerto Rico will face nearly $2 billion worth of bond 
payments.
  Already, businesses have closed, public worker benefits are in 
jeopardy, hospital care is restricted and basic governmental functions 
are at risk.
  Should the Puerto Rican government default in early July, it faces 
certain litigation by its creditors, further erosion of its economy, 
and an inability to provide basic services to its people.
  This measure creates a process for the Commonwealth to restructure 
their bond debts, avoiding a default that could lead to a humanitarian 
catastrophe and instead allowing Puerto Rico to return to economic 
growth and fiscal balance.
  It would allow for the creation of a seven-member Financial Oversight 
and Management board which will approve annual budgets and fiscal 
plans.
  This fiscal plan must be designed in a way that provides adequate 
funding for pension obligations.
  Also, I have serious concerns about the minimum wage provision of the 
measure.
  Specifically, regarding minimum wage and overtime, H.R. 5278 would 
extend the application of the existing federal subminimum wage of $4.25 
an hour to those under the age of 25 in Puerto Rico for as long as four 
years, while all other federal jurisdictions pay the subminimum wage to 
those under the age of 20 for only up to the first ninety days of 
employment.
  We need to continue to work on ways to improve this measure to 
ascertain that American citizens in Puerto Rico are not languishing in 
poverty.
  Indeed, the measure contains a provision that provides for a delay on 
the new Department of Labor overtime pay regulation until a Government 
Accountability Office (GAO) study is completed and the Department of 
Labor determines whether the rule could negatively impact the economy 
of Puerto Rico.
  Additionally, the measure would create a ``Revitalization 
Coordinator'' that works closely with the Oversight Board to determine 
which energy and other infrastructure projects will be able to bypass 
local environmental, public health, and consumer protection laws.
  Let me underscore again that I have serious concerns about the 
provisions in this measure, not the least of which is the expansion of 
the subminimum wage, the exemption from the new overtime rule, and the 
exclusion of protections for pension benefits.
  I commend my Democratic colleagues in their efforts of protecting the 
environment and wildlife refuge in the Commonwealth.
  I look forward to working with my Democratic colleagues and our 
Republican colleagues across the aisle in continuing to improve the 
provisions of the measure for the betterment of fellow American 
citizens in Puerto Rico.
  Let me conclude by highlighting that H.R. 5278 is not perfect but so 
long as we continue to work on a bipartisan basis in good faith, we can 
work towards our efforts of ensuring that Puerto Rico does not become a 
humanitarian crisis.
  We must continue to work together to be our brother's and sister's 
keepers.
  It is essential that we stand with the people of Puerto Rico and take 
action.
  It is essential that we continue to work towards an orderly process 
that promotes the livelihood of U.S. citizens in Puerto Rico and 
alleviates the crisis.
  Mr. SALMON. Mr. Chair, I rise today to speak to an action taken by 
the Puerto Rican Secretary of Health who issued Administrative Order 
No. 346 on February 9, 2016. This Order is noteworthy in that it was 
issued without the benefit of review by Puerto Rico's legislature, and 
without any prior notice or comment period afforded to impacted parties 
that typically accompanies the publication of such Orders.
  Order No. 346 imposes an unprecedented set of regulatory requirements 
and fees on the nutritional dietary supplement industry that will 
invariably increase the cost to consumers who rely upon nutritional 
supplements as an adjunct to their normal diet.
  This Order creates significant economic barriers to acquiring 
nutritional supplements that have been widely accepted by consumers as 
a way of maintaining healthy lifestyles and preventing adverse health 
events in their lives.
  The Congress has recognized the importance of encouraging American 
adults to maintain minimum average daily intake of a variety of 
nutrients that are essential to maintaining health and well-being. The 
U.S. government has encouraged and funded a broad range of consumer 
education initiatives across the spectrum of public health agencies in 
the federal government with the goal of providing consumers with 
valuable information about the importance of the minimum daily 
nutritional intake standards required to maintain good health.
  Nutrition experts at the Harvard School of Public Health have 
emphasized the importance of a food pyramid that recommends a ``daily 
multivitamin plus extra vitamin D (for most people).''
  Researchers at Tufts University have designed a specific food guide 
for the elderly that features the benefits of daily supplements of 
calcium, vitamin D, and vitamin B-12 that are needed for optimal 
health.
  The American Academy of Nutrition and Dietetics has issued a policy 
statement that emphasizes the importance of good food choices, and it 
also recognizes that nutritional supplements can help some people meet 
their daily nutritional needs.
  Supplements should be seen as one component of the search for a 
healthier lifestyle, including improvements in overall food habits and 
engaging in physical exercise. Much of the current research on 
nutrition and health focuses on prevention of chronic disease, but the 
primary reason most people use multivitamins and other nutritional 
supplements is to support overall wellness.
  I was astounding to me to find out about Order No. 346 issued by the 
Puerto Rican Secretary of Health that imposes a set of onerous market 
access fees in Puerto Rico for nutritional supplements, including a $25 
fee on retailers and distributors for every variation of the supplement 
by size, flavor, and stock keeping unit (``SKU'').
  But the ``money grab'' did not stop there.
  Manufacturers must file an application and pay an additional $500 fee 
every 2 years for products that they intend to sell in Puerto Rico.
  Wholesale and Retail distributors must also register and pay an 
additional $100 fee every 2 years.
  Facilities are subject to inspection, and must pay a $50 fee every 2 
years.
  In addition, Order No. 346 also imposes an additional significant 
administrative burden by requiring quality control data, Certificates 
of Analysis, the process used to obtain the product, label samples, 
promotional materials, Advertisements, Laboratory Certificates, and any 
and all warning statements which the FDA does not require of retailers 
of any regulated goods, which includes foods, drugs, and devices.
  These requirements are transparently only justifications for the 
imposition of this new regimen of fees.
  This onerous new fee structure may have the unintended consequence of 
usurping the role of the FDA in regulating the introduction of 
nutritional supplements into commerce as this Congress has determined 
by statute to be sufficient.
  There has not been any significant incident in Puerto Rico where a 
nutritional supplement manufacturer has introduced a tainted product to 
consumers. Nor is there any record of any significant number of adverse 
events attributable to the sale of nutritional supplements to Puerto 
Rican consumers. Furthermore, there are no reports of abusive 
commercial activities by nutritional supplement retailers in Puerto 
Rico.
  Finally, there are no unique public health concerns or issues 
attributable to nutritional supplement manufacturing or sales to 
consumers in Puerto Rico that have not been fully and adequately 
addressed by the FDA.
  Federal public health agencies, research organizations, and non-
government organizations widely encourage the use of nutritional 
supplements to maintain minimum dietary intake, particularly for at-
risk populations like the elderly and low-income families.
  Intuitively, one would think that the Public Health Agency 
responsible for the promotion of health and well-being of the people of 
Puerto Rico would be tearing down any barrier that exists for its 
people to access nutritional foods and supplements that promote the 
health and well-being of families.
  But the reality is, and it is a conundrum that is well known to this 
body, is that Puerto Rico is in the midst of a serious financial crisis 
for which it is seeking relief.
  As I understand it, Order No. 346 is a transparent and perverse way 
for the Puerto Rican

[[Page 8408]]

government to generate revenue. I cannot help but remember the lyrics 
of a favorite song of mine sung by country music star Waylon Jennings, 
``Looking for Love in All the Wrong Places.''
  Is it not wrong to be looking for new revenue by increasing the costs 
to Puerto Rican families for nutritional supplements that assist them 
in maintaining a healthy lifestyle and thereby help them avoid adverse 
and costly health events that would incur potentially avoidable costs 
both to patients and government health care programs?
  Is it not wrong for the Secretary of Health to impose a back-door tax 
on nutritional supplements without the benefit of a statute authorizing 
these fees enacted by the Puerto Rican legislature?
  Is it not wrong to single out one industry, particularly an industry 
whose products support a public policy to promote the health and well-
being of its citizens--particularly the elderly and children?
  How can the Puerto Rican government come to this Congress and expect 
to be taken seriously in their request for fiscal relief from their 
current debt burden when they are continuing to enact policies like 
Order No. 346 that are so grossly counterintuitive to good government 
policy?
  My colleague, Mr. Zinke, has authored a legislative remedy that will 
nullify Puerto Rico Administrative Order No. 346.
  I fully support this legislative effort that will protect the people 
of Puerto Rico from arbitrary and onerous restrictions on their access 
to nutritional supplement products, and threatens to damage the 
economic growth of the economy in Puerto Rico.
  If Administrative Order No. 346 is allowed to stand, the cumulative 
effect of a new layer of bureaucratic ``red tape'' and the unjustified 
imposition of regulatory fees will make Puerto Rico the costliest place 
to do business by natural products retailers anywhere in the United 
States or its territories.
  Low income consumers will likely be forced away from legitimate 
retailers on the Island and seek access to reasonably priced products 
on the Internet. The problem with that strategy is that the Internet is 
well known as a haven for counterfeit products and fly-by-night 
suppliers who regularly avoid the scrutiny of the FDA and failed to 
maintain good manufacturing practices for the production of its 
products.
  The perverse outcome of Administrative Order No. 346 is that it will 
actually increase the threat to public health among the citizens of 
Puerto Rico.
  An equally perverse outcome of Administrative Order No. 346 is that 
many Puerto Rican families will be unable to afford the increase in 
prices on nutritional supplements that they rely upon, and they will 
likely forgo those expenditures. Low income families will be hit the 
hardest as they are less likely to get nutrition they need from food 
alone, and nutritional supplements our key part of their maintaining 
the health and well-being.
  And I would ask my colleagues to consider this: Administrative Order 
No. 346, if it is allowed to stand, sets a dangerous precedent for 
every legitimate business operating in Puerto Rico today. If the 
Congress fails to nullify this order, nothing will stand in the way of 
the Government of Puerto Rico from imposing similar regulatory regimens 
on every other industry on the Island, without any notice or debate, 
and it will become the incubator for this terrible policy to migrate to 
other states and territories who are looking to enhance revenues.
  Much of what we do here in the Congress is to establish public 
policies to protect consumers from exploitive and predatory actions of 
unscrupulous manufacturers of products that economically harm our 
citizens.
  We are confronted today by a desperate Puerto Rican Government who 
appears to have set aside its duty to responsibly enact public policies 
that are consistent with the regular order of commerce, particularly as 
it relates to nutritional supplements, and has embarked on a clearly 
exploitive and predatory path to fleece nutritional supplement 
manufacturers and penalize its own consumers in the process.
  The Congress is now required to act to defend its own authority and 
regulatory framework for nutritional supplement products as 
administered by the FDA, the Federal Trade Commission, and the 
Department of Justice. We must act in order to prevent this exploitive 
and predatory action by the Puerto Rican Government that will have the 
inevitable consequence of harming its own citizens.
  The Acting CHAIR. All time for general debate has expired.
  Pursuant to the rule, the bill shall be considered for amendment 
under the 5-minute rule.
  In lieu of the amendment in the nature of a substitute recommended by 
the Committee on Natural Resources, printed in the bill, it shall be in 
order to consider as an original bill for the purpose of amendment 
under the 5-minute rule, an amendment in the nature of a substitute 
consisting of the text of Rules Committee Print 114-57. That amendment 
in the nature of a substitute shall be considered as read.
  The text of the amendment in the nature of a substitute is as 
follows:

                               H.R. 5278

       Be it enacted by the Senate and House of Representatives of 
     the United States of America in Congress assembled,

     SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

       (a) Short Title.--This Act may be cited as the ``Puerto 
     Rico Oversight, Management, and Economic Stability Act'' or 
     ``PROMESA''.
       (b) Table of Contents.--The table of contents of this Act 
     is as follows:

Sec. 1. Short title; table of contents.
Sec. 2. Effective date.
Sec. 3. Severability.
Sec. 4. Supremacy.
Sec. 5. Definitions.
Sec. 6. Placement.
Sec. 7. Compliance with Federal laws.

       TITLE I--ESTABLISHMENT AND ORGANIZATION OF OVERSIGHT BOARD

Sec. 101. Financial Oversight and Management Board.
Sec. 102. Location of Oversight Board.
Sec. 103. Executive Director and staff of Oversight Board.
Sec. 104. Powers of Oversight Board.
Sec. 105. Exemption from liability for claims.
Sec. 106. Treatment of actions arising from Act.
Sec. 107. Budget and funding for operation of Oversight Board.
Sec. 108. Autonomy of Oversight Board.
Sec. 109. Ethics.

             TITLE II--RESPONSIBILITIES OF OVERSIGHT BOARD

Sec. 201. Approval of fiscal plans.
Sec. 202. Approval of budgets.
Sec. 203. Effect of finding of noncompliance with budget.
Sec. 204. Review of activities to ensure compliance with fiscal plan.
Sec. 205. Recommendations on financial stability and management 
              responsibility.
Sec. 206. Oversight Board duties related to restructuring.
Sec. 207. Oversight Board authority related to debt issuance.
Sec. 208. Required reports.
Sec. 209. Termination of Oversight Board.
Sec. 210. No full faith and credit of the United States.
Sec. 211. Analysis of pensions.
Sec. 212. Intervention in litigation.

                    TITLE III--ADJUSTMENTS OF DEBTS

Sec. 301. Applicability of other laws; definitions.
Sec. 302. Who may be a debtor.
Sec. 303. Reservation of territorial power to control territory and 
              territorial instrumentalities.
Sec. 304. Petition and proceedings relating to petition.
Sec. 305. Limitation on jurisdiction and powers of court.
Sec. 306. Jurisdiction.
Sec. 307. Venue.
Sec. 308. Selection of presiding judge.
Sec. 309. Abstention.
Sec. 310. Applicable rules of procedure.
Sec. 311. Leases.
Sec. 312. Filing of plan of adjustment.
Sec. 313. Modification of plan.
Sec. 314. Confirmation.
Sec. 315. Role and capacity of Oversight Board.
Sec. 316. Compensation of professionals.
Sec. 317. Interim compensation.

                   TITLE IV--MISCELLANEOUS PROVISIONS

Sec. 401. Rules of construction.
Sec. 402. Right of Puerto Rico to determine its future political 
              status.
Sec. 403. First minimum wage in Puerto Rico.
Sec. 404. Application of regulation to Puerto Rico.
Sec. 405. Automatic stay upon enactment.
Sec. 406. Purchases by territory governments.
Sec. 407. Protection from inter-debtor transfers.
Sec. 408. GAO report on Small Business Administration programs in 
              Puerto Rico.
Sec. 409. Congressional Task Force on Economic Growth in Puerto Rico.
Sec. 410. Report.

           TITLE V--PUERTO RICO INFRASTRUCTURE REVITALIZATION

Sec. 501. Definitions.
Sec. 502. Position of Revitalization Coordinator.
Sec. 503. Critical projects.
Sec. 504. Miscellaneous provisions.
Sec. 505. Federal agency requirements.
Sec. 506. Judicial review.
Sec. 507. Savings clause.

                  TITLE VI--CREDITOR COLLECTIVE ACTION

Sec. 601. Creditor Collective action.
Sec. 602. Applicable law.

  TITLE VII--SENSE OF CONGRESS REGARDING PERMANENT, PRO-GROWTH FISCAL 
                                REFORMS

Sec. 701. Sense of Congress regarding permanent, pro-growth fiscal 
              reforms.

     SEC. 2. EFFECTIVE DATE.

       (a) In General.--Except as provided in subsection (b), this 
     Act shall take effect on the date of the enactment of this 
     Act.

[[Page 8409]]

       (b) Title III and Title VI.--
       (1) Title III shall apply with respect to cases commenced 
     under title III on or after the date of the enactment of this 
     Act.
       (2) Titles III and VI shall apply with respect to debts, 
     claims, and liens (as such terms are defined in section 101 
     of title 11, United States Code) created before, on, or after 
     such date.

     SEC. 3. SEVERABILITY.

       If any provision of this Act or the application thereof to 
     any person or circumstance is held invalid, the remainder of 
     this Act, or the application of that provision to persons or 
     circumstances other than those as to which it is held 
     invalid, is not affected thereby, provided that title III is 
     not severable from titles I and II, and titles I and II are 
     not severable from title III.

     SEC. 4. SUPREMACY.

       The provisions of this Act shall prevail over any general 
     or specific provisions of territory law, State law, or 
     regulation that is inconsistent with this Act.

     SEC. 5. DEFINITIONS.

       In this Act--
       (1) Agreed accounting standards.--The term ``agreed 
     accounting standards'' means modified accrual accounting 
     standards or, for any period during which the Oversight Board 
     determines in its sole discretion that a territorial 
     government is not reasonably capable of comprehensive 
     reporting that complies with modified accrual accounting 
     standards, such other accounting standards as proposed by the 
     Oversight Board.
       (2) Bond.--The term ``Bond'' means a bond, loan, letter of 
     credit, other borrowing title, obligation of insurance, or 
     other financial indebtedness for borrowed money, including 
     rights, entitlements, or obligations whether such rights, 
     entitlements, or obligations arise from contract, statute, or 
     any other source of law, in any case, related to such a bond, 
     loan, letter of credit, other borrowing title, obligation of 
     insurance, or other financial indebtedness in physical or 
     dematerialized form of which the issuer, obligor, or 
     guarantor is the territorial government.
       (3) Bond claim.--The term ``Bond Claim'' means, as it 
     relates to a Bond--
       (A) right to payment, whether or not such right is reduced 
     to judgment, liquidated, unliquidated, fixed, contingent, 
     matured, unmatured, disputed, undisputed, legal, equitable, 
     secured, or unsecured; or
       (B) right to an equitable remedy for breach of performance 
     if such breach gives rise to a right to payment, whether or 
     not such right to an equitable remedy is reduced to judgment, 
     fixed, contingent, matured, unmatured, disputed, undisputed, 
     secured, or unsecured.
       (4) Budget.--The term ``Budget'' means the Territory Budget 
     or an Instrumentality Budget, as applicable.
       (5) Puerto rico.--The term ``Puerto Rico'' means the 
     Commonwealth of Puerto Rico.
       (6) Compliant budget.--The term ``compliant budget'' means 
     a budget that is prepared in accordance with--
       (A) agreed accounting standards; and
       (B) the applicable Fiscal Plan.
       (7) Covered territorial instrumentality.--The term 
     ``covered territorial instrumentality'' means a territorial 
     instrumentality designated by the Oversight Board pursuant to 
     section 101 to be subject to the requirements of this Act.
       (8) Covered territory.--The term ``covered territory'' 
     means a territory for which an Oversight Board has been 
     established under section 101.
       (9) Executive director.--The term ``Executive Director'' 
     means an Executive Director appointed under section 103(a).
       (10) Fiscal plan.--The term ``Fiscal Plan'' means a 
     Territory Fiscal Plan or an Instrumentality Fiscal Plan, as 
     applicable.
       (11) Government of puerto rico.--The term ``Government of 
     Puerto Rico'' means the Commonwealth of Puerto Rico, 
     including all its territorial instrumentalities.
       (12) Governor.--The term ``Governor'' means the chief 
     executive of a covered territory.
       (13) Instrumentality budget.--The term ``Instrumentality 
     Budget'' means a budget for a covered territorial 
     instrumentality, designated by the Oversight Board in 
     accordance with section 101, submitted, approved, and 
     certified in accordance with section 202.
       (14) Instrumentality fiscal plan.--The term 
     ``Instrumentality Fiscal Plan'' means a fiscal plan for a 
     covered territorial instrumentality, designated by the 
     Oversight Board in accordance with section 101, submitted, 
     approved, and certified in accordance with section 201.
       (15) Legislature.--The term ``Legislature'' means the 
     legislative body responsible for enacting the laws of a 
     covered territory.
       (16) Modified accrual accounting standards.--The term 
     ``modified accrual accounting standards'' means recognizing 
     revenues as they become available and measurable and 
     recognizing expenditures when liabilities are incurred, in 
     each case as defined by the Governmental Accounting Standards 
     Board, in accordance with generally accepted accounting 
     principles.
       (17) Oversight board.--The term ``Oversight Board'' means a 
     Financial Oversight and Management Board established in 
     accordance with section 101.
       (18) Territorial government.--The term ``territorial 
     government'' means the government of a covered territory, 
     including all covered territorial instrumentalities.
       (19) Territorial instrumentality.--
       (A) In general.--The term ``territorial instrumentality'' 
     means any political subdivision, public agency, 
     instrumentality-including any instrumentality that is also a 
     bank-or public corporation of a territory, and this term 
     should be broadly construed to effectuate the purposes of 
     this Act.
       (B) Exclusion.--The term ``territorial instrumentality'' 
     does not include an Oversight Board.
       (20) Territory.--The term ``territory'' means--
       (A) Puerto Rico;
       (B) Guam;
       (C) American Samoa;
       (D) the Commonwealth of the Northern Mariana Islands; or
       (E) the United States Virgin Islands.
       (21) Territory budget.--The term ``Territory Budget'' means 
     a budget for a territorial government submitted, approved, 
     and certified in accordance with section 202.
       (22) Territory fiscal plan.--The term ``Territory Fiscal 
     Plan'' means a fiscal plan for a territorial government 
     submitted, approved, and certified in accordance with section 
     201.

     SEC. 6. PLACEMENT.

       The Law Revision Counsel is directed to place this Act as 
     chapter 20 of title 48, United States Code.

     SEC. 7. COMPLIANCE WITH FEDERAL LAWS.

       Except as otherwise provided in this Act, nothing in this 
     Act shall be construed as impairing or in any manner 
     relieving a territorial government, or any territorial 
     instrumentality thereof, from compliance with Federal laws or 
     requirements or territorial laws and requirements 
     implementing a federally authorized or federally delegated 
     program protecting the health, safety, and environment of 
     persons in such territory.

       TITLE I--ESTABLISHMENT AND ORGANIZATION OF OVERSIGHT BOARD

     SEC. 101. FINANCIAL OVERSIGHT AND MANAGEMENT BOARD.

       (a) Purpose.--The purpose of the Oversight Board is to 
     provide a method for a covered territory to achieve fiscal 
     responsibility and access to the capital markets.
       (b) Establishment.--
       (1) In general.--Except as provided in paragraph (2), a 
     Financial Oversight and Management Board for a territory is 
     established in accordance with this section only if the 
     Legislature of the territory adopts a resolution signed by 
     the Governor requesting the establishment.
       (2) Puerto rico.--Notwithstanding paragraph (1), a 
     Financial Oversight and Management Board is hereby 
     established for Puerto Rico.
       (3) Constitutional basis.--The Congress enacts this Act 
     pursuant to article IV, section 3 of the Constitution of the 
     United States, which provides Congress the power to dispose 
     of and make all needful rules and regulations for 
     territories.
       (c) Treatment.--An Oversight Board established under this 
     section--
       (1) shall be created as an entity within the territorial 
     government for which it is established in accordance with 
     this title; and
       (2) shall not be considered to be a department, agency, 
     establishment, or instrumentality of the Federal Government.
       (d) Oversight of Territorial Instrumentalities.--
       (1) Designation.--
       (A) In general.--An Oversight Board, in its sole discretion 
     at such time as the Oversight Board determines to be 
     appropriate, may designate any territorial instrumentality as 
     a covered territorial instrumentality that is subject to the 
     requirements of this Act.
       (B) Budgets and reports.--The Oversight Board may require, 
     in its sole discretion, the Governor to submit to the 
     Oversight Board such budgets and monthly or quarterly reports 
     regarding a covered territorial instrumentality as the 
     Oversight Board determines to be necessary and may designate 
     any covered territorial instrumentality to be included in the 
     Territory Budget; except that the Oversight Board may not 
     designate a covered territorial instrumentality to be 
     included in the Territory Budget if applicable territory law 
     does not require legislative approval of such covered 
     territorial instrumentality's budget.
       (C) Separate instrumentality budgets and reports.--The 
     Oversight Board in its sole discretion may or, if it requires 
     a budget from a covered territorial instrumentality whose 
     budget does not require legislative approval under applicable 
     territory law, shall designate a covered territorial 
     instrumentality to be the subject of an Instrumentality 
     Budget separate from the applicable Territory Budget and 
     require that the Governor develop such an Instrumentality 
     Budget.
       (D) Inclusion in territory fiscal plan.--The Oversight 
     Board may require, in its sole discretion, the Governor to 
     include a covered territorial instrumentality in the 
     applicable Territory Fiscal Plan. Any covered territorial 
     instrumentality submitting a separate Instrumentality Fiscal 
     Plan must also submit a separate Instrumentality Budget.
       (E) Separate instrumentality fiscal plans.--The Oversight 
     Board may designate, in its sole discretion, a covered 
     territorial instrumentality to be the subject of an 
     Instrumentality Fiscal Plan separate from the applicable 
     Territory Fiscal Plan and require that the Governor develop 
     such an Instrumentality Fiscal Plan. Any covered territorial 
     instrumentality submitting a separate Instrumentality Fiscal 
     Plan must also submit a separate Instrumentality Budget.
       (2) Exclusion.--
       (A) In general.--An Oversight Board, in its sole 
     discretion, at such time as the Oversight Board determines to 
     be appropriate, may exclude any territorial instrumentality 
     from the requirements of this Act.

[[Page 8410]]

       (B) Treatment.--A territorial instrumentality excluded 
     pursuant to this paragraph shall not be considered to be a 
     covered territorial instrumentality.
       (e) Membership.--
       (1) In general.--
       (A) The Oversight Board shall consist of seven members 
     appointed by the President who meet the qualifications 
     described in subsection (f) and section 109(a).
       (B) The Board shall be comprised of one Category A member, 
     one Category B member, two Category C members, one Category D 
     member, one Category E member, and one Category F member.
       (2) Appointed members.--
       (A) The President shall appoint the individual members of 
     the Oversight Board, of which--
       (i) the Category A member should be selected from a list of 
     individuals submitted by the Speaker of the House of 
     Representatives;
       (ii) the Category B member should be selected from a 
     separate list of individuals submitted by the Speaker of the 
     House of Representatives;
       (iii) the Category C members should be selected from a list 
     submitted by the Majority Leader of the Senate;
       (iv) the Category D member should be selected from a list 
     submitted by the Minority Leader of the House of 
     Representatives;
       (v) the Category E member should be selected from a list 
     submitted by the Minority Leader of the Senate; and
       (vi) the Category F member may be selected in the 
     President's sole discretion.
       (B) After the President's selection of the Category F Board 
     member, for purposes of subparagraph (A) and within a timely 
     manner--
       (i) the Speaker of the House of Representatives shall 
     submit two non-overlapping lists of at least three 
     individuals to the President; one list shall include three 
     individuals who maintain a primary residence in the territory 
     or have a primary place of business in the territory;
       (ii) the Senate Majority Leader shall submit a list of at 
     least four individuals to the President;
       (iii) the Minority Leader of the House of Representatives 
     shall submit a list of at least three individuals to the 
     President; and
       (iv) the Minority Leader of the Senate shall submit a list 
     of at least three individuals to the President.
       (C) If the President does not select any of the names 
     submitted under subparagraphs (A) and (B), then whoever 
     submitted such list may supplement the lists provided in this 
     subsection with additional names.
       (D) The Category A member shall maintain a primary 
     residence in the territory or have a primary place of 
     business in the territory.
       (E) With respect to the appointment of a Board member in 
     Category A, B, C, D, or E, such an appointment shall be by 
     and with the advice and consent of the Senate, unless the 
     President appoints an individual from a list, as provided in 
     this subsection, in which case no Senate confirmation is 
     required.
       (F) In the event of a vacancy of a Category A, B, C, D, or 
     E Board seat, the corresponding congressional leader 
     referenced in subparagraph (A) shall submit a list pursuant 
     to this subsection within a timely manner of the Board 
     member's resignation or removal becoming effective.
       (G) With respect to an Oversight Board for Puerto Rico, in 
     the event any of the 7 members have not been appointed by 
     September 30, 2016, then the President shall appoint an 
     individual from the list for the current vacant category by 
     December 1, 2016, provided that such list includes at least 2 
     individuals per vacancy who meet the requirements set forth 
     in subsection (f) and section 109, and are willing to serve.
       (3) Ex officio member.--The Governor, or the Governor's 
     designee, shall be an ex officio member of the Oversight 
     Board without voting rights.
       (4) Chair.--The voting members of the Oversight Board shall 
     designate one of the voting members of the Oversight Board as 
     the Chair of the Oversight Board (referred to hereafter in 
     this Act as the ``Chair'') within 30 days of the full 
     appointment of the Oversight Board.
       (5) Term of service.--
       (A) In general.--Each appointed member of the Oversight 
     Board shall be appointed for a term of 3 years.
       (B) Removal.--The President may remove any member of the 
     Oversight Board only for cause.
       (C) Continuation of service until successor appointed.--
     Upon the expiration of a term of office, a member of the 
     Oversight Board may continue to serve until a successor has 
     been appointed.
       (D) Reappointment.--An individual may serve consecutive 
     terms as an appointed member, provided that such 
     reappointment occurs in compliance with paragraph (6).
       (6) Vacancies.--A vacancy on the Oversight Board shall be 
     filled in the same manner in which the original member was 
     appointed.
       (f) Eligibility for Appointments.--An individual is 
     eligible for appointment as a member of the Oversight Board 
     only if the individual--
       (1) has knowledge and expertise in finance, municipal bond 
     markets, management, law, or the organization or operation of 
     business or government; and
       (2) prior to appointment, an individual is not an officer, 
     elected official, or employee of the territorial government, 
     a candidate for elected office of the territorial government, 
     or a former elected official of the territorial government.
       (g) No Compensation for Service.--Members of the Oversight 
     Board shall serve without pay, but may receive reimbursement 
     from the Oversight Board for any reasonable and necessary 
     expenses incurred by reason of service on the Oversight 
     Board.
       (h) Adoption of Bylaws for Conducting Business of Oversight 
     Board.--
       (1) In general.--As soon as practicable after the 
     appointment of all members and appointment of the Chair, the 
     Oversight Board shall adopt bylaws, rules, and procedures 
     governing its activities under this Act, including procedures 
     for hiring experts and consultants. Such bylaws, rules, and 
     procedures shall be public documents, and shall be submitted 
     by the Oversight Board upon adoption to the Governor, the 
     Legislature, the President, and Congress. The Oversight Board 
     may hire professionals as it determines to be necessary to 
     carry out this subsection.
       (2) Activities requiring approval of majority of members.--
     Under the bylaws adopted pursuant to paragraph (1), the 
     Oversight Board may conduct its operations under such 
     procedures as it considers appropriate, except that an 
     affirmative vote of a majority of the members of the 
     Oversight Board's full appointed membership shall be required 
     in order for the Oversight Board to approve a Fiscal Plan 
     under section 201, to approve a Budget under section 202, to 
     cause a legislative act not to be enforced under section 204, 
     or to approve or disapprove an infrastructure project as a 
     Critical Project under section 503.
       (3) Adoption of rules and regulations of territorial 
     government.--The Oversight Board may incorporate in its 
     bylaws, rules, and procedures under this subsection such 
     rules and regulations of the territorial government as it 
     considers appropriate to enable it to carry out its 
     activities under this Act with the greatest degree of 
     independence practicable.
       (4) Executive session.--Upon a majority vote of the 
     Oversight Board's full voting membership, the Oversight Board 
     may conduct its business in an executive session that 
     consists solely of the Oversight Board's voting members and 
     is closed to the public, but only for the business items set 
     forth as part of the vote to convene an executive session.

     SEC. 102. LOCATION OF OVERSIGHT BOARD.

       The Oversight Board shall have an office in the covered 
     territory and additional offices as it deems necessary. At 
     any time, any department or agency of the United States may 
     provide the Oversight Board use of Federal facilities and 
     equipment on a reimbursable or non-reimbursable basis and 
     subject to such terms and conditions as the head of that 
     department or agency may establish.

     SEC. 103. EXECUTIVE DIRECTOR AND STAFF OF OVERSIGHT BOARD.

       (a) Executive Director.--The Oversight Board shall have an 
     Executive Director who shall be appointed by the Chair with 
     the consent of the Oversight Board. The Executive Director 
     shall be paid at a rate determined by the Oversight Board.
       (b) Staff.--With the approval of the Chair, the Executive 
     Director may appoint and fix the pay of additional personnel 
     as the Executive Director considers appropriate, except that 
     no individual appointed by the Executive Director may be paid 
     at a rate greater than the rate of pay for the Executive 
     Director unless the Oversight Board provides for otherwise. 
     The staff shall include a Revitalization Coordinator 
     appointed pursuant to Title V of this Act. Any such personnel 
     may include private citizens, employees of the Federal 
     Government, or employees of the territorial government, 
     provided, however, that the Executive Director may not fix 
     the pay of employees of the Federal Government or the 
     territorial government.
       (c) Inapplicability of Certain Employment and Procurement 
     Laws.--The Executive Director and staff of the Oversight 
     Board may be appointed and paid without regard to any 
     provision of the laws of the covered territory or the Federal 
     Government governing appointments and salaries. Any provision 
     of the laws of the covered territory governing procurement 
     shall not apply to the Oversight Board.
       (d) Staff of Federal Agencies.--Upon request of the Chair, 
     the head of any Federal department or agency may detail, on a 
     reimbursable or nonreimbursable basis, and in accordance with 
     the Intergovernmental Personnel Act of 1970 (5 U.S.C. 3371-
     3375), any of the personnel of that department or agency to 
     the Oversight Board to assist it in carrying out its duties 
     under this Act.
       (e) Staff of Territorial Government.--Upon request of the 
     Chair, the head of any department or agency of the covered 
     territory may detail, on a reimbursable or nonreimbursable 
     basis, any of the personnel of that department or agency to 
     the Oversight Board to assist it in carrying out its duties 
     under this Act.

     SEC. 104. POWERS OF OVERSIGHT BOARD.

       (a) Hearings and Sessions.--The Oversight Board may, for 
     the purpose of carrying out this Act, hold hearings, sit and 
     act at times and places, take testimony, and receive evidence 
     as the Oversight Board considers appropriate. The Oversight 
     Board may administer oaths or affirmations to witnesses 
     appearing before it.
       (b) Powers of Members and Agents.--Any member or agent of 
     the Oversight Board may, if authorized by the Oversight 
     Board, take any action that the Oversight Board is authorized 
     to take by this section.
       (c) Obtaining Official Data.--
       (1) From federal government.--Notwithstanding sections 552 
     (commonly known as the Freedom of Information Act), 552a 
     (commonly known as the Privacy Act of 1974), and 552b 
     (commonly known as the Government in the

[[Page 8411]]

     Sunshine Act) of title 5, United States Code, the Oversight 
     Board may secure directly from any department or agency of 
     the United States information necessary to enable it to carry 
     out this Act, with the approval of the head of that 
     department or agency.
       (2) From territorial government.--Notwithstanding any other 
     provision of law, the Oversight Board shall have the right to 
     secure copies, whether written or electronic, of such 
     records, documents, information, data, or metadata from the 
     territorial government necessary to enable the Oversight 
     Board to carry out its responsibilities under this Act. At 
     the request of the Oversight Board, the Oversight Board shall 
     be granted direct access to such information systems, 
     records, documents, information, or data as will enable the 
     Oversight Board to carry out its responsibilities under this 
     Act. The head of the entity of the territorial government 
     responsible shall provide the Oversight Board with such 
     information and assistance (including granting the Oversight 
     Board direct access to automated or other information 
     systems) as the Oversight Board requires under this 
     paragraph.
       (d) Obtaining Creditor Information.--
       (1) Upon request of the Oversight Board, each creditor or 
     organized group of creditors of a covered territory or 
     covered territorial instrumentality seeking to participate in 
     voluntary negotiations shall provide to the Oversight Board, 
     and the Oversight Board shall make publicly available to any 
     other participant, a statement setting forth--
       (A) the name and address of the creditor or of each member 
     of an organized group of creditors; and
       (B) the nature and aggregate amount of claims or other 
     economic interests held in relation to the issuer as of the 
     later of--
       (i) the date the creditor acquired the claims or other 
     economic interests or, in the case of an organized group of 
     creditors, the date the group was formed; or
       (ii) the date the Oversight Board was formed.
       (2) For purposes of this subsection, an organized group 
     shall mean multiple creditors that are--
       (A) acting in concert to advance their common interests, 
     including, but not limited to, retaining legal counsel to 
     represent such multiple entities; and
       (B) not composed entirely of affiliates or insiders of one 
     another.
       (3) The Oversight Board may request supplemental statements 
     to be filed by each creditor or organized group of creditors 
     quarterly, or if any fact in the most recently filed 
     statement has changed materially.
       (e) Gifts, Bequests, and Devises.--The Oversight Board may 
     accept, use, and dispose of gifts, bequests, or devises of 
     services or property, both real and personal, for the purpose 
     of aiding or facilitating the work of the Oversight Board. 
     Gifts, bequests, or devises of money and proceeds from sales 
     of other property received as gifts, bequests, or devises 
     shall be deposited in such account as the Oversight Board may 
     establish and shall be available for disbursement upon order 
     of the Chair, consistent with the Oversight Board's bylaws, 
     or rules and procedures. All gifts, bequests or devises and 
     the identities of the donors shall be publicly disclosed by 
     the Oversight Board within 30 days of receipt.
       (f) Subpoena Power.--
       (1) In general.--The Oversight Board may issue subpoenas 
     requiring the attendance and testimony of witnesses and the 
     production of books, records, correspondence, memoranda, 
     papers, documents, electronic files, metadata, tapes, and 
     materials of any nature relating to any matter under 
     investigation by the Oversight Board. Jurisdiction to compel 
     the attendance of witnesses and the production of such 
     materials shall be governed by the statute setting forth the 
     scope of personal jurisdiction exercised by the covered 
     territory, or in the case of Puerto Rico, 32 L.P.R.A. App. 
     III. R. 4. 7., as amended.
       (2) Failure to obey a subpoena.--If a person refuses to 
     obey a subpoena issued under paragraph (1), the Oversight 
     Board may apply to the court of first instance of the covered 
     territory. Any failure to obey the order of the court may be 
     punished by the court in accordance with civil contempt laws 
     of the covered territory.
       (3) Service of subpoenas.--The subpoena of the Oversight 
     Board shall be served in the manner provided by the rules of 
     procedure for the courts of the covered territory, or in the 
     case of Puerto Rico, the Rules of Civil Procedure of Puerto 
     Rico, for subpoenas issued by the court of first instance of 
     the covered territory.
       (g) Authority To Enter Into Contracts.--The Executive 
     Director may enter into such contracts as the Executive 
     Director considers appropriate (subject to the approval of 
     the Chair) consistent with the Oversight Board's bylaws, 
     rules, and regulations to carry out the Oversight Board's 
     responsibilities under this Act.
       (h) Authority To Enforce Certain Laws of the Covered 
     Territory.--The Oversight Board shall ensure the purposes of 
     this Act are met, including by ensuring the prompt 
     enforcement of any applicable laws of the covered territory 
     prohibiting public sector employees from participating in a 
     strike or lockout. In the application of this subsection, 
     with respect to Puerto Rico, the term ``applicable laws'' 
     refers to 3 L.P.R.A. 1451q and 3 L.P.R.A. 1451r, as amended.
       (i) Voluntary Agreement Certification.--
       (1) In general.--The Oversight Board shall issue a 
     certification to a covered territory or covered territorial 
     instrumentality if the Oversight Board determines, in its 
     sole discretion, that such covered territory or covered 
     territorial instrumentality, as applicable, has successfully 
     reached a voluntary agreement with holders of its Bond Claims 
     to restructure such Bond Claims--
       (A) except as provided in subparagraph (C), if an 
     applicable Fiscal Plan has been certified, in a manner that 
     provides for a sustainable level of debt for such covered 
     territory or covered territorial instrumentality, as 
     applicable, and is in conformance with the applicable 
     certified Fiscal Plan;
       (B) except as provided in subparagraph (C), if an 
     applicable Fiscal Plan has not yet been certified, in a 
     manner that provides, in the Oversight Board's sole 
     discretion, for a sustainable level of debt for such covered 
     territory or covered territorial instrumentality; or
       (C) notwithstanding subparagraphs (A) and (B), if an 
     applicable Fiscal Plan has not yet been certified and the 
     voluntary agreement is limited solely to an extension of 
     applicable principal maturities and interest on Bonds issued 
     by such covered territory or covered territorial 
     instrumentality, as applicable, for a period of up to one 
     year during which time no interest will be paid on the Bond 
     Claims affected by the voluntary agreement.
       (2) Effectiveness.--The effectiveness of any voluntary 
     agreement referred to in paragraph (1) shall be conditioned 
     on--
       (A) the Oversight Board delivering the certification 
     described in paragraph (1); and
       (B) the agreement of a majority in amount of the Bond 
     Claims of a covered territory or a covered territorial 
     instrumentality that are to be affected by such agreement, 
     provided, however, that such agreement is solely for purposes 
     of serving as a Qualifying Modification pursuant to 
     subsection 601(g) of this Act and shall not alter existing 
     legal rights of holders of Bond Claims against such covered 
     territory or covered territorial instrumentality that have 
     not assented to such agreement.
       (3) Preexisting voluntary agreements.--Any voluntary 
     agreements that the territorial government or any covered 
     territorial instrumentality has executed with holders of its 
     debts to restructure such debts prior to the date of 
     enactment of the Act shall be deemed to be in conformance 
     with the requirements of this subsection, to the extent the 
     requirements of paragraph (2)(B)(i) have been satisfied.
       (j) Restructuring Filings.--
       (1) In general.--Subject to paragraph (3), before taking an 
     action described in paragraph (2) on behalf of a debtor or 
     potential debtor in a case under title III, the Oversight 
     Board must certify the action.
       (2) Actions described.--The actions referred to in 
     paragraph (1) are--
       (A) the filing of a petition; or
       (B) the submission or modification of a plan of adjustment.
       (3) Condition for plans of adjustment.--The Oversight Board 
     may certify a plan of adjustment only if it determines, in 
     its sole discretion, that it is consistent with the 
     applicable certified Fiscal Plan.
       (k) Civil Actions To Enforce Powers.--The Oversight Board 
     may seek judicial enforcement of its authority to carry out 
     its responsibilities under this Act.
       (l) Penalties.--
       (1) Acts prohibited.--Any officer or employee of the 
     territorial government who prepares, presents, or certifies 
     any information or report for the Oversight Board or any of 
     its agents that is intentionally false or misleading, or, 
     upon learning that any such information is false or 
     misleading, fails to immediately advise the Oversight Board 
     or its agents thereof in writing, shall be subject to 
     prosecution and penalties under any laws of the territory 
     prohibiting the provision of false information to government 
     officials, which in the case of Puerto Rico shall include 33 
     L.P.R.A. 4889, as amended.
       (2) Administrative discipline.--In addition to any other 
     applicable penalty, any officer or employee of the 
     territorial government who knowingly and willfully violates 
     paragraph (1) or takes any such action in violation of any 
     valid order of the Oversight Board or fails or refuses to 
     take any action required by any such order, shall be subject 
     to appropriate administrative discipline, including (when 
     appropriate) suspension from duty without pay or removal from 
     office, by order of the Governor.
       (3) Report by governor on disciplinary actions taken.--In 
     the case of a violation of paragraph (2) by an officer or 
     employee of the territorial government, the Governor shall 
     immediately report to the Oversight Board all pertinent facts 
     together with a statement of the action taken thereon.
       (m) Electronic Reporting.--The Oversight Board may, in 
     consultation with the Governor, ensure the prompt and 
     efficient payment and administration of taxes through the 
     adoption of electronic reporting, payment and auditing 
     technologies.
       (n) Administrative Support Services.--Upon the request of 
     the Oversight Board, the Administrator of General Services or 
     other appropriate Federal agencies shall promptly provide to 
     the Oversight Board, on a reimbursable or non-reimbursable 
     basis, the administrative support services necessary for the 
     Oversight Board to carry out its responsibilities under this 
     Act.
       (o) Investigation of Disclosure and Selling Practices.--The 
     Oversight Board may investigate the disclosure and selling 
     practices in connection with the purchase of bonds issued by 
     the Government of Puerto Rico for or on behalf

[[Page 8412]]

     of any retail investors including any underrepresentation of 
     risk for such investors and any relationships or conflicts of 
     interest maintained by such broker, dealer, or investment 
     adviser is as provided in applicable laws and regulations.
       (p) Findings of Any Investigation.--The Oversight Board 
     shall make public the findings of any investigation 
     referenced in subsection (o).

     SEC. 105. EXEMPTION FROM LIABILITY FOR CLAIMS.

       The Oversight Board, its members, and its employees shall 
     not be liable for any obligation of or claim against the 
     Oversight Board or its members or employees or the 
     territorial government resulting from actions taken to carry 
     out this Act.

     SEC. 106. TREATMENT OF ACTIONS ARISING FROM ACT.

       (a) Jurisdiction.--Except as provided in section 104(f)(2) 
     (relating to the issuance of an order enforcing a subpoena), 
     and title III (relating to adjustments of debts), any action 
     against the Oversight Board, and any action otherwise arising 
     out of this Act, in whole or in part, shall be brought in a 
     United States district court for the covered territory or, 
     for any covered territory that does not have a district 
     court, in the United States District Court for the District 
     of Hawaii.
       (b) Appeal.--Notwithstanding any other provision of law, 
     any order of a United States district court that is issued 
     pursuant to an action brought under subsection (a) shall be 
     subject to review only pursuant to a notice of appeal to the 
     applicable United States Court of Appeals.
       (c) Timing of Relief.--Except with respect to any orders 
     entered to remedy constitutional violations, no order of any 
     court granting declaratory or injunctive relief against the 
     Oversight Board, including relief permitting or requiring the 
     obligation, borrowing, or expenditure of funds, shall take 
     effect during the pendency of the action before such court, 
     during the time appeal may be taken, or (if appeal is taken) 
     during the period before the court has entered its final 
     order disposing of such action.
       (d) Expedited Consideration.--It shall be the duty of the 
     applicable United States District Court, the applicable 
     United States Court of Appeals, and, as applicable, the 
     Supreme Court of the United States to advance on the docket 
     and to expedite to the greatest possible extent the 
     disposition of any matter brought under this Act.
       (e) Review of Oversight Board Certifications.--There shall 
     be no jurisdiction in any United States district court to 
     review challenges to the Oversight Board's certification 
     determinations under this Act.

     SEC. 107. BUDGET AND FUNDING FOR OPERATION OF OVERSIGHT 
                   BOARD.

       (a) Submission of Budget.--The Oversight Board shall submit 
     a budget for each fiscal year during which the Oversight 
     Board is in operation, to the President, the House of 
     Representatives Committee on Natural Resources and the Senate 
     Committee on Energy and Natural Resources, the Governor, and 
     the Legislature.
       (b) Funding.--The Oversight Board shall use its powers with 
     respect to the Territory Budget of the covered territory to 
     ensure that sufficient funds are available to cover all 
     expenses of the Oversight Board. Within 30 days after the 
     date of enactment of this Act, the territorial government 
     shall designate a dedicated funding source, not subject to 
     subsequent legislative appropriations, sufficient to support 
     the annual expenses of the Oversight Board as determined in 
     the Oversight Board's sole and exclusive discretion.

     SEC. 108. AUTONOMY OF OVERSIGHT BOARD.

       (a) In General.--Neither the Governor nor the Legislature 
     may--
       (1) exercise any control, supervision, oversight, or review 
     over the Oversight Board or its activities; or
       (2) enact, implement, or enforce any statute, resolution, 
     policy, or rule that would impair or defeat the purposes of 
     this Act, as determined by the Oversight Board.
       (b) Oversight Board Legal Representation.--In any action 
     brought by or on behalf of the Oversight Board, the Oversight 
     Board shall be represented by such counsel as it may hire or 
     retain so long as no conflict of interest exists.

     SEC. 109. ETHICS.

       (a) Conflict of Interest.--Notwithstanding any ethics 
     provision governing employees of the covered territory, all 
     members and staff of the Oversight Board shall be subject to 
     the Federal conflict of interest requirements described in 
     section 208 of title 18, United States Code.
       (b) Financial Disclosure.--Notwithstanding any ethics 
     provision governing employees of the covered territory, all 
     members of the Oversight Board and staff designated by the 
     Oversight Board shall be subject to disclosure of their 
     financial interests, the contents of which shall conform to 
     the same requirements set forth in section 102 of the Ethics 
     in Government Act of 1978 (5 U.S.C. app.).

             TITLE II--RESPONSIBILITIES OF OVERSIGHT BOARD

     SEC. 201. APPROVAL OF FISCAL PLANS.

       (a) In General.--As soon as practicable after all of the 
     members and the Chair have been appointed to the Oversight 
     Board in accordance with section 101(e) in the fiscal year in 
     which the Oversight Board is established, and in each fiscal 
     year thereafter during which the Oversight Board is in 
     operation, the Oversight Board shall deliver a notice to the 
     Governor providing a schedule for the process of development, 
     submission, approval, and certification of Fiscal Plans. The 
     notice may also set forth a schedule for revisions to any 
     Fiscal Plan that has already been certified, which revisions 
     must be subject to subsequent approval and certification by 
     the Oversight Board. The Oversight Board shall consult with 
     the Governor in establishing a schedule, but the Oversight 
     Board shall retain sole discretion to set or, by delivery of 
     a subsequent notice to the Governor, change the dates of such 
     schedule as it deems appropriate and reasonably feasible.
       (b) Requirements.--
       (1) In general.--A Fiscal Plan developed under this section 
     shall, with respect to the territorial government or covered 
     territorial instrumentality, provide a method to achieve 
     fiscal responsibility and access to the capital markets, 
     and--
       (A) provide for estimates of revenues and expenditures in 
     conformance with agreed accounting standards and be based 
     on--
       (i) applicable laws; or
       (ii) specific bills that require enactment in order to 
     reasonably achieve the projections of the Fiscal Plan;
       (B) ensure the funding of essential public services;
       (C) provide adequate funding for public pension systems;
       (D) provide for the elimination of structural deficits;
       (E) for fiscal years covered by a Fiscal Plan in which a 
     stay under titles III or IV is not effective, provide for a 
     debt burden that is sustainable;
       (F) improve fiscal governance, accountability, and internal 
     controls;
       (G) enable the achievement of fiscal targets;
       (H) create independent forecasts of revenue for the period 
     covered by the Fiscal Plan;
       (I) include a debt sustainability analysis;
       (J) provide for capital expenditures and investments 
     necessary to promote economic growth;
       (K) adopt appropriate recommendations submitted by the 
     Oversight Board under section 205(a);
       (L) include such additional information as the Oversight 
     Board deems necessary;
       (M) ensure that assets, funds, or resources of a 
     territorial instrumentality are not loaned to, transferred 
     to, or otherwise used for the benefit of a covered territory 
     or another covered territorial instrumentality of a covered 
     territory, unless permitted by the constitution of the 
     territory, an approved plan of adjustment under title III, or 
     a Qualifying Modification approved under title VI; and
       (N) respect the relative lawful priorities or lawful liens, 
     as may be applicable, in the constitution, other laws, or 
     agreements of a covered territory or covered territorial 
     instrumentality in effect prior to the date of enactment of 
     this Act.
       (2) Term.--A Fiscal Plan developed under this section shall 
     cover a period of fiscal years as determined by the Oversight 
     Board in its sole discretion but in any case a period of not 
     less than 5 fiscal years from the fiscal year in which it is 
     certified by the Oversight Board.
       (c) Development, Review, Approval, and Certification of 
     Fiscal Plans.--
       (1) Timing requirement.--The Governor may not submit to the 
     Legislature a Territory Budget under section 202 for a fiscal 
     year unless the Oversight Board has certified the Territory 
     Fiscal Plan for that fiscal year in accordance with this 
     subsection, unless the Oversight Board in its sole discretion 
     waives this requirement.
       (2) Fiscal plan developed by governor.--The Governor shall 
     submit to the Oversight Board any proposed Fiscal Plan 
     required by the Oversight Board by the time specified in the 
     notice delivered under subsection (a).
       (3) Review by the oversight board.--The Oversight Board 
     shall review any proposed Fiscal Plan to determine whether it 
     satisfies the requirements set forth in subsection (b) and, 
     if the Oversight Board determines in its sole discretion that 
     the proposed Fiscal Plan--
       (A) satisfies such requirements, the Oversight Board shall 
     approve the proposed Fiscal Plan; or
       (B) does not satisfy such requirements, the Oversight Board 
     shall provide to the Governor--
       (i) a notice of violation that includes recommendations for 
     revisions to the applicable Fiscal Plan; and
       (ii) an opportunity to correct the violation in accordance 
     with subsection (d)(1).
       (d) Revised Fiscal Plan.--
       (1) In general.--If the Governor receives a notice of 
     violation under subsection (c)(3), the Governor shall submit 
     to the Oversight Board a revised proposed Fiscal Plan in 
     accordance with subsection (b) by the time specified in the 
     notice delivered under subsection (a). The Governor may 
     submit as many revised Fiscal Plans to the Oversight Board as 
     the schedule established in the notice delivered under 
     subsection (a) permits.
       (2) Development by oversight board.--If the Governor fails 
     to submit to the Oversight Board a Fiscal Plan that the 
     Oversight Board determines in its sole discretion satisfies 
     the requirements set forth in subsection (b) by the time 
     specified in the notice delivered under subsection (a), the 
     Oversight Board shall develop and submit to the Governor and 
     the Legislature a Fiscal Plan that satisfies the requirements 
     set forth in subsection (b).
       (e) Approval and Certification.--
       (1) Approval of fiscal plan developed by governor.--If the 
     Oversight Board approves a Fiscal Plan under subsection 
     (c)(3), it shall deliver a compliance certification for such 
     Fiscal Plan to the Governor and the Legislature.
       (2) Deemed approval of fiscal plan developed by oversight 
     board.--If the Oversight

[[Page 8413]]

     Board develops a Fiscal Plan under subsection (d)(2), such 
     Fiscal Plan shall be deemed approved by the Governor, and the 
     Oversight Board shall issue a compliance certification for 
     such Fiscal Plan to the Governor and the Legislature.
       (f) Joint Development of Fiscal Plan.--Notwithstanding any 
     other provision of this section, if the Governor and the 
     Oversight Board jointly develop a Fiscal Plan for the fiscal 
     year that meets the requirements under this section, and that 
     the Governor and the Oversight Board certify that the fiscal 
     plan reflects a consensus between the Governor and the 
     Oversight Board, then such Fiscal Plan shall serve as the 
     Fiscal Plan for the territory or territorial instrumentality 
     for that fiscal year.

     SEC. 202. APPROVAL OF BUDGETS.

       (a) Reasonable Schedule for Development of Budgets.--As 
     soon as practicable after all of the members and the Chair 
     have been appointed to the Oversight Board in the fiscal year 
     in which the Oversight Board is established, and in each 
     fiscal year thereafter during which the Oversight Board is in 
     operation, the Oversight Board shall deliver a notice to the 
     Governor and the Legislature providing a schedule for 
     developing, submitting, approving, and certifying Budgets for 
     a period of fiscal years as determined by the Oversight Board 
     in its sole discretion but in any case a period of not less 
     than one fiscal year following the fiscal year in which the 
     notice is delivered. The notice may also set forth a schedule 
     for revisions to Budgets that have already been certified, 
     which revisions must be subject to subsequent approval and 
     certification by the Oversight Board. The Oversight Board 
     shall consult with the Governor and the Legislature in 
     establishing a schedule, but the Oversight Board shall retain 
     sole discretion to set or, by delivery of a subsequent notice 
     to the Governor and the Legislature, change the dates of such 
     schedule as it deems appropriate and reasonably feasible.
       (b) Revenue Forecast.--The Oversight Board shall submit to 
     the Governor and Legislature a forecast of revenues for the 
     period covered by the Budgets by the time specified in the 
     notice delivered under subsection (a), for use by the 
     Governor in developing the Budget under subsection (c).
       (c) Budgets Developed by Governor.--
       (1) Governor's proposed budgets.--The Governor shall submit 
     to the Oversight Board proposed Budgets by the time specified 
     in the notice delivered under subsection (a). In consultation 
     with the Governor in accordance with the process specified in 
     the notice delivered under subsection (a), the Oversight 
     Board shall determine in its sole discretion whether each 
     proposed Budget is compliant with the applicable Fiscal Plan 
     and--
       (A) if a proposed Budget is a compliant budget, the 
     Oversight Board shall--
       (i) approve the Budget; and
       (ii) if the Budget is a Territory Budget, submit the 
     Territory Budget to the Legislature; or
       (B) if the Oversight Board determines that the Budget is 
     not a compliant budget, the Oversight Board shall provide to 
     the Governor--
       (i) a notice of violation that includes a description of 
     any necessary corrective action; and
       (ii) an opportunity to correct the violation in accordance 
     with paragraph (2).
       (2) Governor's revisions.--The Governor may correct any 
     violations identified by the Oversight Board and submit a 
     revised proposed Budget to the Oversight Board in accordance 
     with paragraph (1). The Governor may submit as many revised 
     Budgets to the Oversight Board as the schedule established in 
     the notice delivered under subsection (a) permits. If the 
     Governor fails to develop a Budget that the Oversight Board 
     determines is a compliant budget by the time specified in the 
     notice delivered under subsection (a), the Oversight Board 
     shall develop and submit to the Governor, in the case of an 
     Instrumentality Budget, and to the Governor and the 
     Legislature, in the case of a Territory Budget, a revised 
     compliant budget.
       (d) Budget Approval by Legislature.--
       (1) Legislature adopted budget.--The Legislature shall 
     submit to the Oversight Board the Territory Budget adopted by 
     the Legislature by the time specified in the notice delivered 
     under subsection (a). The Oversight Board shall determine 
     whether the adopted Territory Budget is a compliant budget 
     and--
       (A) if the adopted Territory Budget is a compliant budget, 
     the Oversight Board shall issue a compliance certification 
     for such compliant budget pursuant to subsection (e); and
       (B) if the adopted Territory Budget is not a compliant 
     budget, the Oversight Board shall provide to the 
     Legislature--
       (i) a notice of violation that includes a description of 
     any necessary corrective action; and
       (ii) an opportunity to correct the violation in accordance 
     with paragraph (2).
       (2) Legislature's revisions.--The Legislature may correct 
     any violations identified by the Oversight Board and submit a 
     revised Territory Budget to the Oversight Board in accordance 
     with the process established under paragraph (1) and by the 
     time specified in the notice delivered under subsection (a). 
     The Legislature may submit as many revised adopted Territory 
     Budgets to the Oversight Board as the schedule established in 
     the notice delivered under subsection (a) permits. If the 
     Legislature fails to adopt a Territory Budget that the 
     Oversight Board determines is a compliant budget by the time 
     specified in the notice delivered under subsection (a), the 
     Oversight Board shall develop a revised Territory Budget that 
     is a compliant budget and submit it to the Governor and the 
     Legislature.
       (e) Certification of Budgets.--
       (1) Certification of developed and approved territory 
     budgets.--If the Governor and the Legislature develop and 
     approve a Territory Budget that is a compliant budget by the 
     day before the first day of the fiscal year for which the 
     Territory Budget is being developed and in accordance with 
     the process established under subsections (c) and (d), the 
     Oversight Board shall issue a compliance certification to the 
     Governor and the Legislature for such Territory Budget.
       (2) Certification of developed instrumentality budgets.--If 
     the Governor develops an Instrumentality Budget that is a 
     compliant budget by the day before the first day of the 
     fiscal year for which the Instrumentality Budget is being 
     developed and in accordance with the process established 
     under subsection (c), the Oversight Board shall issue a 
     compliance certification to the Governor for such 
     Instrumentality Budget.
       (3) Deemed certification of territory budgets.--If the 
     Governor and the Legislature fail to develop and approve a 
     Territory Budget that is a compliant budget by the day before 
     the first day of the fiscal year for which the Territory 
     Budget is being developed, the Oversight Board shall submit a 
     Budget to the Governor and the Legislature (including any 
     revision to the Territory Budget made by the Oversight Board 
     pursuant to subsection (d)(2)) and such Budget shall be--
       (A) deemed to be approved by the Governor and the 
     Legislature;
       (B) the subject of a compliance certification issued by the 
     Oversight Board to the Governor and the Legislature; and
       (C) in full force and effect beginning on the first day of 
     the applicable fiscal year.
       (4) Deemed certification of instrumentality budgets.--If 
     the Governor fails to develop an Instrumentality Budget that 
     is a compliant budget by the day before the first day of the 
     fiscal year for which the Instrumentality Budget is being 
     developed, the Oversight Board shall submit an 
     Instrumentality Budget to the Governor (including any 
     revision to the Instrumentality Budget made by the Oversight 
     Board pursuant to subsection (c)(2)) and such Budget shall 
     be--
       (A) deemed to be approved by the Governor;
       (B) the subject of a compliance certification issued by the 
     Oversight Board to the Governor; and
       (C) in full force and effect beginning on the first day of 
     the applicable fiscal year.
       (f) Joint Development of Budgets.--Notwithstanding any 
     other provision of this section, if, in the case of a 
     Territory Budget, the Governor, the Legislature, and the 
     Oversight Board, or in the case of an Instrumentality Budget, 
     the Governor and the Oversight Board, jointly develop such 
     Budget for the fiscal year that meets the requirements under 
     this section, and that the relevant parties certify that such 
     budget reflects a consensus among them, then such Budget 
     shall serve as the Budget for the territory or territorial 
     instrumentality for that fiscal year.

     SEC. 203. EFFECT OF FINDING OF NONCOMPLIANCE WITH BUDGET.

       (a) Submission of Reports.--Not later than 15 days after 
     the last day of each quarter of a fiscal year (beginning with 
     the fiscal year determined by the Oversight Board), the 
     Governor shall submit to the Oversight Board a report, in 
     such form as the Oversight Board may require, describing--
       (1) the actual cash revenues, cash expenditures, and cash 
     flows of the territorial government for the preceding 
     quarter, as compared to the projected revenues, expenditures, 
     and cash flows contained in the certified Budget for such 
     preceding quarter; and
       (2) any other information requested by the Oversight Board, 
     which may include a balance sheet or a requirement that the 
     Governor provide information for each covered territorial 
     instrumentality separately.
       (b) Initial Action by Oversight Board.--
       (1) In general.--If the Oversight Board determines, based 
     on reports submitted by the Governor under subsection (a), 
     independent audits, or such other information as the 
     Oversight Board may obtain, that the actual quarterly 
     revenues, expenditures, or cash flows of the territorial 
     government are not consistent with the projected revenues, 
     expenditures, or cash flows set forth in the certified Budget 
     for such quarter, the Oversight Board shall--
       (A) require the territorial government to provide such 
     additional information as the Oversight Board determines to 
     be necessary to explain the inconsistency; and
       (B) if the additional information provided under 
     subparagraph (A) does not provide an explanation for the 
     inconsistency that the Oversight Board finds reasonable and 
     appropriate, advise the territorial government to correct the 
     inconsistency by implementing remedial action.
       (2) Deadlines.--The Oversight Board shall establish the 
     deadlines by which the territorial government shall meet the 
     requirements of subparagraphs (A) and (B) of paragraph (1).
       (c) Certification.--
       (1) Inconsistency.--If the territorial government fails to 
     provide additional information under subsection (b)(1)(A), or 
     fails to correct an inconsistency under subsection (b)(1)(B), 
     prior to the applicable deadline under subsection (b)(2), the 
     Oversight Board shall certify to the President, the House of 
     Representatives Committee on Natural Resources, the Senate 
     Committee on Energy and Natural Resources, the

[[Page 8414]]

     Governor, and the Legislature that the territorial government 
     is inconsistent with the applicable certified Budget, and 
     shall describe the nature and amount of the inconsistency.
       (2) Correction.--If the Oversight Board determines that the 
     territorial government has initiated such measures as the 
     Oversight Board considers sufficient to correct an 
     inconsistency certified under paragraph (1), the Oversight 
     Board shall certify the correction to the President, the 
     House of Representatives Committee on Natural Resources, the 
     Senate Committee on Energy and Natural Resources, the 
     Governor, and the Legislature.
       (d) Budget Reductions by Oversight Board.--If the Oversight 
     Board determines that the Governor, in the case of any then-
     applicable certified Instrumentality Budgets, and the 
     Governor and the Legislature, in the case of the then-
     applicable certified Territory Budget, have failed to correct 
     an inconsistency identified by the Oversight Board under 
     subsection (c), the Oversight Board shall--
       (1) with respect to the territorial government, other than 
     covered territorial instrumentalities, make appropriate 
     reductions in nondebt expenditures to ensure that the actual 
     quarterly revenues and expenditures for the territorial 
     government are in compliance with the applicable certified 
     Territory Budget or, in the case of the fiscal year in which 
     the Oversight Board is established, the budget adopted by the 
     Governor and the Legislature; and
       (2) with respect to covered territorial instrumentalities 
     at the sole discretion of the Oversight Board--
       (A) make reductions in nondebt expenditures to ensure that 
     the actual quarterly revenues and expenses for the covered 
     territorial instrumentality are in compliance with the 
     applicable certified Budget or, in the case of the fiscal 
     year in which the Oversight Board is established, the budget 
     adopted by the Governor and the Legislature or the covered 
     territorial instrumentality, as applicable; or
       (B)(i) institute automatic hiring freezes at the covered 
     territorial instrumentality; and
       (ii) prohibit the covered territorial instrumentality from 
     entering into any contract or engaging in any financial or 
     other transactions, unless the contract or transaction was 
     previously approved by the Oversight Board.
       (e) Termination of Budget Reductions.--The Oversight Board 
     shall cancel the reductions, hiring freezes, or prohibition 
     on contracts and financial transactions under subsection (d) 
     if the Oversight Board determines that the territorial 
     government or covered territorial instrumentality, as 
     applicable, has initiated appropriate measures to reduce 
     expenditures or increase revenues to ensure that the 
     territorial government or covered territorial instrumentality 
     is in compliance with the applicable certified Budget or, in 
     the case of the fiscal year in which the Oversight Board is 
     established, the budget adopted by the Governor and the 
     Legislature.

     SEC. 204. REVIEW OF ACTIVITIES TO ENSURE COMPLIANCE WITH 
                   FISCAL PLAN.

       (a) Submission of Legislative Acts to Oversight Board.--
       (1) Submission of acts.--Except to the extent that the 
     Oversight Board may provide otherwise in its bylaws, rules, 
     and procedures, not later than 7 business days after a 
     territorial government duly enacts any law during any fiscal 
     year in which the Oversight Board is in operation, the 
     Governor shall submit the law to the Oversight Board.
       (2) Cost estimate; certification of compliance or 
     noncompliance.--The Governor shall include with each law 
     submitted to the Oversight Board under paragraph (1) the 
     following:
       (A) A formal estimate prepared by an appropriate entity of 
     the territorial government with expertise in budgets and 
     financial management of the impact, if any, that the law will 
     have on expenditures and revenues.
       (B) If the appropriate entity described in subparagraph (A) 
     finds that the law is not significantly inconsistent with the 
     Fiscal Plan for the fiscal year, it shall issue a 
     certification of such finding.
       (C) If the appropriate entity described in subparagraph (A) 
     finds that the law is significantly inconsistent with the 
     Fiscal Plan for the fiscal year, it shall issue a 
     certification of such finding, together with the entity's 
     reasons for such finding.
       (3) Notification.--The Oversight Board shall send a 
     notification to the Governor and the Legislature if--
       (A) the Governor submits a law to the Oversight Board under 
     this subsection that is not accompanied by the estimate 
     required under paragraph (2)(A);
       (B) the Governor submits a law to the Oversight Board under 
     this subsection that is not accompanied by either a 
     certification described in paragraph (2)(B) or (2)(C); or
       (C) the Governor submits a law to the Oversight Board under 
     this subsection that is accompanied by a certification 
     described in paragraph (2)(C) that the law is significantly 
     inconsistent with the Fiscal Plan.
       (4) Opportunity to respond to notification.--
       (A) Failure to provide estimate or certification.--After 
     sending a notification to the Governor and the Legislature 
     under paragraph (3)(A) or (3)(B) with respect to a law, the 
     Oversight Board may direct the Governor to provide the 
     missing estimate or certification (as the case may be), in 
     accordance with such procedures as the Oversight Board may 
     establish.
       (B) Submission of certification of significant 
     inconsistency with fiscal plan and budget.--In accordance 
     with such procedures as the Oversight Board may establish, 
     after sending a notification to the Governor and Legislature 
     under paragraph (3)(C) that a law is significantly 
     inconsistent with the Fiscal Plan, the Oversight Board shall 
     direct the territorial government to--
       (i) correct the law to eliminate the inconsistency; or
       (ii) provide an explanation for the inconsistency that the 
     Oversight Board finds reasonable and appropriate.
       (5) Failure to comply.--If the territorial government fails 
     to comply with a direction given by the Oversight Board under 
     paragraph (4) with respect to a law, the Oversight Board may 
     take such actions as it considers necessary, consistent with 
     this Act, to ensure that the enactment or enforcement of the 
     law will not adversely affect the territorial government's 
     compliance with the Fiscal Plan, including preventing the 
     enforcement or application of the law.
       (6) Preliminary review of proposed acts.--At the request of 
     the Legislature, the Oversight Board may conduct a 
     preliminary review of proposed legislation before the 
     Legislature to determine whether the legislation as proposed 
     would be consistent with the applicable Fiscal Plan under 
     this subtitle, except that any such preliminary review shall 
     not be binding on the Oversight Board in reviewing any law 
     subsequently submitted under this subsection.
       (b) Effect of Approved Fiscal Plan on Contracts, Rules, and 
     Regulations.--
       (1) Transparency in contracting.--The Oversight Board shall 
     work with a covered territory's office of the comptroller or 
     any functionally equivalent entity to promote compliance with 
     the applicable law of any covered territory that requires 
     agencies and instrumentalities of the territorial government 
     to maintain a registry of all contracts executed, including 
     amendments thereto, and to remit a copy to the office of the 
     comptroller for inclusion in a comprehensive database 
     available to the public. With respect to Puerto Rico, the 
     term ``applicable law'' refers to 2 L.P.R.A. 97, as amended.
       (2) Authority to review certain contracts.--The Oversight 
     Board may establish policies to require prior Oversight Board 
     approval of certain contracts, including leases and contracts 
     to a governmental entity or government-owned corporations 
     rather than private enterprises that are proposed to be 
     executed by the territorial government, to ensure such 
     proposed contracts promote market competition and are not 
     inconsistent with the approved Fiscal Plan.
       (3) Sense of congress.--It is the sense of Congress that 
     any policies established by the Oversight Board pursuant to 
     paragraph (2) should be designed to make the government 
     contracting process more effective, to increase the public's 
     faith in this process, to make appropriate use of the 
     Oversight Board's time and resources, to make the territorial 
     government a facilitator and not a competitor to private 
     enterprise, and to avoid creating any additional bureaucratic 
     obstacles to efficient contracting.
       (4) Authority to review certain rules, regulations, and 
     executive orders.--The provisions of this paragraph shall 
     apply with respect to a rule, regulation, or executive order 
     proposed to be issued by the Governor (or the head of any 
     department or agency of the territorial government) in the 
     same manner as such provisions apply to a contract.
       (5) Failure to comply.--If a contract, rule, regulation, or 
     executive order fails to comply with policies established by 
     the Oversight Board under this subsection, the Oversight 
     Board may take such actions as it considers necessary to 
     ensure that such contract, rule, executive order or 
     regulation will not adversely affect the territorial 
     government's compliance with the Fiscal Plan, including by 
     preventing the execution or enforcement of the contract, 
     rule, executive order or regulation.
       (c) Restrictions on Budgetary Adjustments.--
       (1) Submissions of requests to oversight board.--If the 
     Governor submits a request to the Legislature for the 
     reprogramming of any amounts provided in a certified Budget, 
     the Governor shall submit such request to the Oversight 
     Board, which shall analyze whether the proposed reprogramming 
     is significantly inconsistent with the Budget, and submit its 
     analysis to the Legislature as soon as practicable after 
     receiving the request.
       (2) No action permitted until analysis received.--The 
     Legislature shall not adopt a reprogramming, and no officer 
     or employee of the territorial government may carry out any 
     reprogramming, until the Oversight Board has provided the 
     Legislature with an analysis that certifies such 
     reprogramming will not be inconsistent with the Fiscal Plan 
     and Budget.
       (3) Prohibition on action until oversight board is 
     appointed.--During the period after a territory becomes a 
     covered territory and prior to the appointment of all members 
     and the Chair of the Oversight Board, such covered territory 
     shall not enact new laws that either permit the transfer of 
     any funds or assets outside the ordinary course of business 
     or that are inconsistent with the constitution or laws of the 
     territory as of the date of enactment of this Act, provided 
     that any executive or legislative action authorizing the 
     movement of funds or assets during this time period may be 
     subject to review and reversal by the Oversight Board upon 
     appointment of the Oversight Board's full membership.
       (d) Implementation of Federal Programs.--In taking actions 
     under this Act, the

[[Page 8415]]

     Oversight Board shall not exercise applicable authorities to 
     impede territorial actions taken to--
       (1) comply with a court-issued consent decree or 
     injunction, or an administrative order or settlement with a 
     Federal agency, with respect to Federal programs;
       (2) implement a federally authorized or federally delegated 
     program; or
       (3) implement territorial laws, which are consistent with a 
     certified Fiscal Plan, that execute Federal requirements and 
     standards.

     SEC. 205. RECOMMENDATIONS ON FINANCIAL STABILITY AND 
                   MANAGEMENT RESPONSIBILITY.

       (a) In General.--The Oversight Board may at any time submit 
     recommendations to the Governor or the Legislature on actions 
     the territorial government may take to ensure compliance with 
     the Fiscal Plan, or to otherwise promote the financial 
     stability, economic growth, management responsibility, and 
     service delivery efficiency of the territorial government, 
     including recommendations relating to--
       (1) the management of the territorial government's 
     financial affairs, including economic forecasting and 
     multiyear fiscal forecasting capabilities, information 
     technology, placing controls on expenditures for personnel, 
     reducing benefit costs, reforming procurement practices, and 
     placing other controls on expenditures;
       (2) the structural relationship of departments, agencies, 
     and independent agencies within the territorial government;
       (3) the modification of existing revenue structures, or the 
     establishment of additional revenue structures;
       (4) the establishment of alternatives for meeting 
     obligations to pay for the pensions of territorial government 
     employees;
       (5) modifications or transfers of the types of services 
     that are the responsibility of, and are delivered by the 
     territorial government;
       (6) modifications of the types of services that are 
     delivered by entities other than the territorial government 
     under alternative service delivery mechanisms;
       (7) the effects of the territory's laws and court orders on 
     the operations of the territorial government;
       (8) the establishment of a personnel system for employees 
     of the territorial government that is based upon employee 
     performance standards;
       (9) the improvement of personnel training and proficiency, 
     the adjustment of staffing levels, and the improvement of 
     training and performance of management and supervisory 
     personnel; and
       (10) the privatization and commercialization of entities 
     within the territorial government.
       (b) Response to Recommendations by the Territorial 
     Government.--
       (1) In general.--In the case of any recommendations 
     submitted under subsection (a) that are within the authority 
     of the territorial government to adopt, not later than 90 
     days after receiving the recommendations, the Governor or the 
     Legislature (whichever has the authority to adopt the 
     recommendation) shall submit a statement to the Oversight 
     Board that provides notice as to whether the territorial 
     government will adopt the recommendations.
       (2) Implementation plan required for adopted 
     recommendations.--If the Governor or the Legislature 
     (whichever is applicable) notifies the Oversight Board under 
     paragraph (1) that the territorial government will adopt any 
     of the recommendations submitted under subsection (a), the 
     Governor or the Legislature (whichever is applicable) shall 
     include in the statement a written plan to implement the 
     recommendation that includes--
       (A) specific performance measures to determine the extent 
     to which the territorial government has adopted the 
     recommendation; and
       (B) a clear and specific timetable pursuant to which the 
     territorial government will implement the recommendation.
       (3) Explanations required for recommendations not 
     adopted.--If the Governor or the Legislature (whichever is 
     applicable) notifies the Oversight Board under paragraph (1) 
     that the territorial government will not adopt any 
     recommendation submitted under subsection (a) that the 
     territorial government has authority to adopt, the Governor 
     or the Legislature shall include in the statement 
     explanations for the rejection of the recommendations, and 
     the Governor or the Legislature shall submit such statement 
     of explanations to the President and Congress.

     SEC. 206. OVERSIGHT BOARD DUTIES RELATED TO RESTRUCTURING.

       (a) Requirements for Restructuring Certification.--The 
     Oversight Board, prior to issuing a restructuring 
     certification regarding an entity (as such term is defined in 
     section 101 of title 11, United States Code), shall 
     determine, in its sole discretion, that--
       (1) the entity has made good-faith efforts to reach a 
     consensual restructuring with creditors;
       (2) the entity has--
       (A) adopted procedures necessary to deliver timely audited 
     financial statements; and
       (B) made public draft financial statements and other 
     information sufficient for any interested person to make an 
     informed decision with respect to a possible restructuring;
       (3) the entity is either a covered territory that has 
     adopted a Fiscal Plan certified by the Oversight Board, a 
     covered territorial instrumentality that is subject to a 
     Territory Fiscal Plan certified by the Oversight Board, or a 
     covered territorial instrumentality that has adopted an 
     Instrumentality Fiscal Plan certified by the Oversight Board; 
     and
       (4)(A) no order approving a Qualifying Modification under 
     section 601 has been entered with respect to such entity; or
       (B) if an order approving a Qualifying Modification has 
     been entered with respect to such entity, the entity is 
     unable to make its debt payments notwithstanding the approved 
     Qualifying Modification, in which case, all claims affected 
     by the Qualifying Modification shall be subject to a title 
     III case.
       (b) Issuance of Restructuring Certification.--The issuance 
     of a restructuring certification under this section requires 
     a vote of no fewer than 5 members of the Oversight Board in 
     the affirmative, which shall satisfy the requirement set 
     forth in section 302(2) of this Act.

     SEC. 207. OVERSIGHT BOARD AUTHORITY RELATED TO DEBT ISSUANCE.

       For so long as the Oversight Board remains in operation, no 
     territorial government may, without the prior approval of the 
     Oversight Board, issue debt or guarantee, exchange, modify, 
     repurchase, redeem, or enter into similar transactions with 
     respect to its debt.

     SEC. 208. REQUIRED REPORTS.

       (a) Annual Report.--Not later than 30 days after the last 
     day of each fiscal year, the Oversight Board shall submit a 
     report to the President, Congress, the Governor and the 
     Legislature, describing--
       (1) the progress made by the territorial government in 
     meeting the objectives of this Act during the fiscal year;
       (2) the assistance provided by the Oversight Board to the 
     territorial government in meeting the purposes of this Act 
     during the fiscal year;
       (3) recommendations to the President and Congress on 
     changes to this Act or other Federal laws, or other actions 
     of the Federal Government, that would assist the territorial 
     government in complying with any certified Fiscal Plan;
       (4) the precise manner in which funds allocated to the 
     Oversight Board under section 107 and, as applicable, section 
     104(e) have been spent by the Oversight Board during the 
     fiscal year; and
       (5) any other activities of the Oversight Board during the 
     fiscal year.
       (b) Report on Discretionary Tax Abatement Agreements.--
     Within six months of the establishment of the Oversight 
     Board, the Governor shall submit a report to the Oversight 
     Board documenting all existing discretionary tax abatement or 
     similar tax relief agreements to which the territorial 
     government, or any territorial instrumentality, is a party, 
     provided that--
       (1) nothing in this Act shall be interpreted to limit the 
     power of the territorial government or any territorial 
     instrumentality to execute or modify discretionary tax 
     abatement or similar tax relief agreements, or to enforce 
     compliance with the terms and conditions of any discretionary 
     tax abatement or similar tax relief agreement, to which the 
     territorial government or any territorial instrumentality is 
     a party; and
       (2) the members and staff of the Oversight Board shall not 
     disclose the contents of the report described in this 
     subsection, and shall otherwise comply with all applicable 
     territorial and Federal laws and regulations regarding the 
     handling of confidential taxpayer information.
       (c) Quarterly Reports of Cash Flow.--The Oversight Board, 
     when feasible, shall report on the amount of cash flow 
     available for the payment of debt service on all notes, 
     bonds, debentures, credit agreements, or other instruments 
     for money borrowed whose enforcement is subject to a stay or 
     moratorium hereunder, together with any variance from the 
     amount set forth in the debt sustainability analysis of the 
     Fiscal Plan under section 201(b)(1)(I).

     SEC. 209. TERMINATION OF OVERSIGHT BOARD.

       An Oversight Board shall terminate upon certification by 
     the Oversight Board that--
       (1) the applicable territorial government has adequate 
     access to short-term and long-term credit markets at 
     reasonable interest rates to meet the borrowing needs of the 
     territorial government; and
       (2) for at least 4 consecutive fiscal years--
       (A) the territorial government has developed its Budgets in 
     accordance with modified accrual accounting standards; and
       (B) the expenditures made by the territorial government 
     during each fiscal year did not exceed the revenues of the 
     territorial government during that year, as determined in 
     accordance with modified accrual accounting standards.

     SEC. 210. NO FULL FAITH AND CREDIT OF THE UNITED STATES.

       (a) In General.--The full faith and credit of the United 
     States is not pledged for the payment of any principal of or 
     interest on any bond, note, or other obligation issued by a 
     covered territory or covered territorial instrumentality. The 
     United States is not responsible or liable for the payment of 
     any principal of or interest on any bond, note, or other 
     obligation issued by a covered territory or covered 
     territorial instrumentality.
       (b) Subject to Appropriations.--Any claim to which the 
     United States is determined to be liable under this Act shall 
     be subject to appropriations.
       (c) Funding.--No Federal funds shall be authorized by this 
     Act for the payment of any liability of the territory or 
     territorial instrumentality.

     SEC. 211. ANALYSIS OF PENSIONS.

       (a) Determination.--If the Oversight Board determines, in 
     its sole discretion, that a pension system of the territorial 
     government is materially underfunded, the Oversight Board 
     shall conduct an analysis prepared by an independent actuary 
     of such pension system to assist the Oversight Board in 
     evaluating the fiscal and economic impact of the pension cash 
     flows.

[[Page 8416]]

       (b) Provisions of Analysis.--An analysis conducted under 
     subsection (a) shall include--
       (1) an actuarial study of the pension liabilities and 
     funding strategy that includes a forward looking projection 
     of payments of at least 30 years of benefit payments and 
     funding strategy to cover such payments;
       (2) sources of funding to cover such payments;
       (3) a review of the existing benefits and their 
     sustainability; and
       (4) a review of the system's legal structure and 
     operational arrangements, and any other studies of the 
     pension system the Oversight Board shall deem necessary.
       (c) Supplementary Information.--In any case, the analysis 
     conducted under subsection (a) shall include information 
     regarding the fair market value and liabilities using an 
     appropriate discount rate as determined by the Oversight 
     Board.

     SEC. 212. INTERVENTION IN LITIGATION.

       (a) Intervention.--The Oversight Board may intervene in any 
     litigation filed against the territorial government.
       (b) Injunctive Relief.--
       (1) In general.--If the Oversight Board intervenes in a 
     litigation under subsection (a), the Oversight Board may seek 
     injunctive relief, including a stay of litigation.
       (2) No independent basis for relief.--This section does not 
     create an independent basis on which injunctive relief, 
     including a stay of litigation, may be granted.

                    TITLE III--ADJUSTMENTS OF DEBTS

     SEC. 301. APPLICABILITY OF OTHER LAWS; DEFINITIONS.

       (a) Sections Applicable to Cases Under This Title.--
     Sections 101 (except as otherwise provided in this section), 
     102, 104, 105, 106, 107, 108, 112, 333, 344, 347(b), 349, 
     350(b), 351, 361, 362, 364(c), 364(d), 364(e), 364(f), 365, 
     366, 501, 502, 503, 504, 506, 507(a)(2), 509, 510, 524(a)(1), 
     524(a)(2), 544, 545, 546, 547, 548, 549(a), 549(c), 549(d), 
     550, 551, 552, 553, 555, 556, 557, 559, 560, 561, 562, 902 
     (except as otherwise provided in this section), 922, 923, 
     924, 925, 926, 927, 928, 942, 944, 945, 946, 1102, 1103, 
     1109, 1111(b), 1122, 1123(a)(1), 1123(a)(2), 1123(a)(3), 
     1123(a)(4), 1123(a)(5), 1123(b), 1123(d), 1124, 1125, 
     1126(a), 1126(b), 1126(c), 1126(e), 1126(f), 1126(g), 
     1127(d), 1128, 1129(a)(2), 1129(a)(3), 1129(a)(6), 
     1129(a)(8), 1129(a)(10), 1129(b)(1), 1129(b)(2)(A), 
     1129(b)(2)(B), 1142(b), 1143, 1144, 1145, and 1146(a) of 
     title 11, United States Code, apply in a case under this 
     title and section 930 of title 11, United States Code, 
     applies in a case under this title; however, section 930 
     shall not apply in any case during the first 120 days after 
     the date on which such case is commenced under this title.
       (b) Meanings of Terms.--A term used in a section of title 
     11, United States Code, made applicable in a case under this 
     title by subsection (a), has the meaning given to the term 
     for the purpose of the applicable section, unless the term is 
     otherwise defined in this title.
       (c) Definitions.--In this title:
       (1) Affiliate.--The term ``affiliate'' means, in addition 
     to the definition made applicable in a case under this title 
     by subsection (a)--
       (A) for a territory, any territorial instrumentality; and
       (B) for a territorial instrumentality, the governing 
     territory and any of the other territorial instrumentalities 
     of the territory.
       (2) Debtor.--The term ``debtor'' means the territory or 
     covered territorial instrumentality concerning which a case 
     under this title has been commenced.
       (3) Holder of a claim or interest.--The term ``holder of a 
     claim or interest'', when used in section 1126 of title 11, 
     United States Code, made applicable in a case under this 
     title by subsection (a)--
       (A) shall exclude any Issuer or Authorized Instrumentality 
     of the Territory Government Issuer (as defined under Title VI 
     of this Act) or a corporation, trust or other legal entity 
     that is controlled by the Issuer or an Authorized Territorial 
     Instrumentality of the Territory Government Issuer, provided 
     that the beneficiaries of such claims, to the extent they are 
     not referenced in this subparagraph, shall not be excluded; 
     and
       (B) with reference to Insured Bonds, shall mean the 
     monoline insurer insuring such Insured Bond to the extent 
     such insurer is granted the right to vote Insured Bonds for 
     purposes of directing remedies or consenting to proposed 
     amendments or modifications as provided in the applicable 
     documents pursuant to which such Insured Bond was issued and 
     insured.
       (4) Insured bond.--The term ``Insured Bond'' means a bond 
     subject to a financial guarantee or similar insurance 
     contract, policy and/or surety issued by a monoline insurer.
       (5) Property of the estate.--The term ``property of the 
     estate'', when used in a section of title 11, United States 
     Code, made applicable in a case under this title by 
     subsection (a), means property of the debtor.
       (6) State.--The term ``State'' when used in a section of 
     title 11, United States Code, made applicable in a case under 
     this title by subsection (a) means State or territory when 
     used in reference to the relationship of a State to the 
     municipality of the State or the territorial instrumentality 
     of a territory, as applicable.
       (7) Trustee.--The term ``trustee'', when used in a section 
     of title 11, United States Code, made applicable in a case 
     under this title by subsection (a), means the Oversight 
     Board, except as provided in section 926 of title 11, United 
     States Code.
       (d) Reference to Title.--Solely for purposes of this title, 
     a reference to ``this title'', ``this chapter'', or words of 
     similar import in a section of title 11, United States Code, 
     made applicable in a case under this title by subsection (a) 
     or to ``this title'', ``title 11'', ``Chapter 9'', ``the 
     Code'', or words of similar import in the Federal Rules of 
     Bankruptcy Procedure made applicable in a case under this 
     title shall be deemed to be a reference to this title.
       (e) Substantially Similar.--In determining whether claims 
     are ``substantially similar'' for the purpose of section 1122 
     of title 11, United States Code, made applicable in a case 
     under this title by subsection (a), the Oversight Board shall 
     consider whether such claims are secured and whether such 
     claims have priority over other claims.
       (f) Operative Clauses.--A section made applicable in a case 
     under this title by subsection (a) that is operative if the 
     business of the debtor is authorized to be operated is 
     operative in a case under this title.

     SEC. 302. WHO MAY BE A DEBTOR.

       An entity may be a debtor under this title if--
       (1) the entity is--
       (A) a territory that has requested the establishment of an 
     Oversight Board or has had an Oversight Board established for 
     it by the United States Congress in accordance with section 
     101 of this Act; or
       (B) a covered territorial instrumentality of a territory 
     described in paragraph (1)(A);
       (2) the Oversight Board has issued a certification under 
     section 206(b) of this Act for such entity; and
       (3) the entity desires to effect a plan to adjust its 
     debts.

     SEC. 303. RESERVATION OF TERRITORIAL POWER TO CONTROL 
                   TERRITORY AND TERRITORIAL INSTRUMENTALITIES.

       Subject to the limitations set forth in titles I and II of 
     this Act, this title does not limit or impair the power of a 
     covered territory to control, by legislation or otherwise, 
     the territory or any territorial instrumentality thereof in 
     the exercise of the political or governmental powers of the 
     territory or territorial instrumentality, including 
     expenditures for such exercise, whether or not a case has 
     been or can be commenced under this title, but--
       (1) a territory law prescribing a method of composition of 
     indebtedness or a moratorium law, but solely to the extent 
     that it prohibits the payment of principal or interest by an 
     entity not described in section 109(b)(2) of title 11, United 
     States Code, may not bind any creditor of a covered territory 
     or any covered territorial instrumentality thereof that does 
     not consent to the composition or moratorium;
       (2) a judgment entered under a law described in paragraph 
     (1) may not bind a creditor that does not consent to the 
     composition; and
       (3) unlawful executive orders that alter, amend, or modify 
     rights of holders of any debt of the territory or territorial 
     instrumentality, or that divert funds from one territorial 
     instrumentality to another or to the territory, shall be 
     preempted by this Act.

     SEC. 304. PETITION AND PROCEEDINGS RELATING TO PETITION.

       (a) Commencement of Case.--A voluntary case under this 
     title is commenced by the filing with the district court of a 
     petition by the Oversight Board pursuant to the determination 
     under section 206 of this Act.
       (b) Objection to Petition.--After any objection to the 
     petition, the court, after notice and a hearing, may dismiss 
     the petition if the petition does not meet the requirements 
     of this title; however, this subsection shall not apply in 
     any case during the first 120 days after the date on which 
     such case is commenced under this title.
       (c) Order for Relief.--The commencement of a case under 
     this title constitutes an order for relief.
       (d) Appeal.--The court may not, on account of an appeal 
     from an order for relief, delay any proceeding under this 
     title in the case in which the appeal is being taken, nor 
     shall any court order a stay of such proceeding pending such 
     appeal.
       (e) Validity of Debt.--The reversal on appeal of a finding 
     of jurisdiction shall not affect the validity of any debt 
     incurred that is authorized by the court under section 364(c) 
     or 364(d) of title 11, United States Code.
       (f) Joint Filing of Petitions and Plans Permitted.--The 
     Oversight Board, on behalf of debtors under this title, may 
     file petitions or submit or modify plans of adjustment 
     jointly if the debtors are affiliates; provided, however, 
     that nothing in this title shall be construed as authorizing 
     substantive consolidation of the cases of affiliated debtors.
       (g) Joint Administration of Affiliated Cases.--If the 
     Oversight Board, on behalf of a debtor and one or more 
     affiliates, has filed separate cases and the Oversight Board, 
     on behalf of the debtor or one of the affiliates, files a 
     motion to administer the cases jointly, the court may order a 
     joint administration of the cases.
       (h) Public Safety.--This Act may not be construed to permit 
     the discharge of obligations arising under Federal police or 
     regulatory laws, including laws relating to the environment, 
     public health or safety, or territorial laws implementing 
     such Federal legal provisions. This includes compliance 
     obligations, requirements under consent decrees or judicial 
     orders, and obligations to pay associated administrative, 
     civil, or other penalties.
       (i) Voting on Debt Adjustment Plans Not Stayed.--
     Notwithstanding any provision in this title to the contrary, 
     including sections of title 11, United States Code, 
     incorporated by reference, nothing in this section shall 
     prevent the holder of a claim from voting on or consenting to 
     a proposed modification of such claim under title VI of this 
     Act.

[[Page 8417]]



     SEC. 305. LIMITATION ON JURISDICTION AND POWERS OF COURT.

       Subject to the limitations set forth in titles I and II of 
     this Act, notwithstanding any power of the court, unless the 
     Oversight Board consents or the plan so provides, the court 
     may not, by any stay, order, or decree, in the case or 
     otherwise, interfere with--
       (1) any of the political or governmental powers of the 
     debtor;
       (2) any of the property or revenues of the debtor; or
       (3) the use or enjoyment by the debtor of any income-
     producing property.

     SEC. 306. JURISDICTION.

       (a) Federal Subject Matter Jurisdiction.--The district 
     courts shall have--
       (1) except as provided in paragraph (2), original and 
     exclusive jurisdiction of all cases under this title; and
       (2) except as provided in subsection (b), and 
     notwithstanding any Act of Congress that confers exclusive 
     jurisdiction on a court or courts other than the district 
     courts, original but not exclusive jurisdiction of all civil 
     proceedings arising under this title, or arising in or 
     related to cases under this title.
       (b) Property Jurisdiction.--The district court in which a 
     case under this title is commenced or is pending shall have 
     exclusive jurisdiction of all property, wherever located, of 
     the debtor as of the commencement of the case.
       (c) Personal Jurisdiction.--The district court in which a 
     case under this title is pending shall have personal 
     jurisdiction over any person or entity.
       (d) Removal, Remand, and Transfer.--
       (1) Removal.--A party may remove any claim or cause of 
     action in a civil action, other than a proceeding before the 
     United States Tax Court or a civil action by a governmental 
     unit to enforce the police or regulatory power of the 
     governmental unit, to the district court for the district in 
     which the civil action is pending, if the district court has 
     jurisdiction of the claim or cause of action under this 
     section.
       (2) Remand.--The district court to which the claim or cause 
     of action is removed under paragraph (1) may remand the claim 
     or cause of action on any equitable ground. An order entered 
     under this subsection remanding a claim or cause of action, 
     or a decision not to remand, is not reviewable by appeal or 
     otherwise by the court of appeals under section 158(d), 1291 
     or 1292 of title 28, United States Code, or by the Supreme 
     Court of the United States under section 1254 of title 28, 
     United States Code.
       (3) Transfer.--A district court shall transfer any civil 
     proceeding arising under this title, or arising in or related 
     to a case under this title, to the district court in which 
     the case under this title is pending.
       (e) Appeal.--
       (1) An appeal shall be taken in the same manner as appeals 
     in civil proceedings generally are taken to the courts of 
     appeals from the district court.
       (2) The court of appeals for the circuit in which a case 
     under this title has venue pursuant to section 307 of this 
     title shall have jurisdiction of appeals from all final 
     decisions, judgments, orders and decrees entered under this 
     title by the district court.
       (3) The court of appeals for the circuit in which a case 
     under this title has venue pursuant to section 307 of this 
     title shall have jurisdiction to hear appeals of 
     interlocutory orders or decrees if--
       (A) the district court on its own motion or on the request 
     of a party to the order or decree certifies that--
       (i) the order or decree involves a question of law as to 
     which there is no controlling decision of the court of 
     appeals for the circuit or of the Supreme Court of the United 
     States, or involves a matter of public importance;
       (ii) the order or decree involves a question of law 
     requiring the resolution of conflicting decisions; or
       (iii) an immediate appeal from the order or decree may 
     materially advance the progress of the case or proceeding in 
     which the appeal is taken; and
       (B) the court of appeals authorizes the direct appeal of 
     the order or decree.
       (4) If the district court on its own motion or on the 
     request of a party determines that a circumstance specified 
     in clauses (i), (ii), or (iii) of paragraph (3)(A) exists, 
     then the district court shall make the certification 
     described in paragraph (3).
       (5) The parties may supplement the certification with a 
     short statement of the basis for the certification issued by 
     the district court under paragraph (3)(A).
       (6) Except as provided in section 304(d), an appeal of an 
     interlocutory order or decree does not stay any proceeding of 
     the district court from which the appeal is taken unless the 
     district court, or the court of appeals in which the appeal 
     is pending, issues a stay of such proceedings pending the 
     appeal.
       (7) Any request for a certification in respect to an 
     interlocutory appeal of an order or decree shall be made not 
     later than 60 days after the entry of the order or decree.
       (f) Reallocation of Court Staff.--Notwithstanding any law 
     to the contrary, the clerk of the court in which a case is 
     pending shall reallocate as many staff and assistants as the 
     clerk deems necessary to ensure that the court has adequate 
     resources to provide for proper case management.

     SEC. 307. VENUE.

       (a) In General.--Venue shall be proper in--
       (1) with respect to a territory, the district court for the 
     territory or, for any territory that does not have a district 
     court, the United States District Court for the District of 
     Hawaii; and
       (2) with respect to a covered territorial instrumentality, 
     the district court for the territory in which the covered 
     territorial instrumentality is located or, for any territory 
     that does not have a district court, the United States 
     District Court for the District of Hawaii.
       (b) Alternative Venue.--If the Oversight Board so 
     determines in its sole discretion, then venue shall be proper 
     in the district court for the jurisdiction in which the 
     Oversight Board maintains an office that is located outside 
     the territory.

     SEC. 308. SELECTION OF PRESIDING JUDGE.

       (a) For cases in which the debtor is a territory, the Chief 
     Justice of the United States shall designate a district court 
     judge to sit by designation to conduct the case.
       (b) For cases in which the debtor is not a territory, and 
     no motion for joint administration of the debtor's case with 
     the case of its affiliate territory has been filed or there 
     is no case in which the affiliate territory is a debtor, the 
     chief judge of the court of appeals for the circuit embracing 
     the district in which the case is commenced shall designate a 
     district court judge to conduct the case.

     SEC. 309. ABSTENTION.

       Nothing in this title prevents a district court in the 
     interests of justice from abstaining from hearing a 
     particular proceeding arising in or related to a case under 
     this title.

     SEC. 310. APPLICABLE RULES OF PROCEDURE.

       The Federal Rules of Bankruptcy Procedure shall apply to a 
     case under this title and to all civil proceedings arising in 
     or related to cases under this title.

     SEC. 311. LEASES.

       A lease to a territory or territorial instrumentality shall 
     not be treated as an executory contract or unexpired lease 
     for the purposes of section 365 or 502(b)(6) of title 11, 
     United States Code, solely by reason of the lease being 
     subject to termination in the event the debtor fails to 
     appropriate rent.

     SEC. 312. FILING OF PLAN OF ADJUSTMENT.

       (a) Exclusivity.--Only the Oversight Board, after the 
     issuance of a certificate pursuant to section 104(j) of this 
     Act, may file a plan of adjustment of the debts of the 
     debtor.
       (b) Deadline for Filing Plan.--If the Oversight Board does 
     not file a plan of adjustment with the petition, the 
     Oversight Board shall file a plan of adjustment at the time 
     set by the court.

     SEC. 313. MODIFICATION OF PLAN.

       The Oversight Board, after the issuance of a certification 
     pursuant to section 104(j) of this Act, may modify the plan 
     at any time before confirmation, but may not modify the plan 
     so that the plan as modified fails to meet the requirements 
     of this title. After the Oversight Board files a 
     modification, the plan as modified becomes the plan.

     SEC. 314. CONFIRMATION.

       (a) Objection.--A special tax payer may object to 
     confirmation of a plan.
       (b) Confirmation.--The court shall confirm the plan if--
       (1) the plan complies with the provisions of title 11 of 
     the United States Code, made applicable to a case under this 
     title by section 301 of this Act;
       (2) the plan complies with the provisions of this title;
       (3) the debtor is not prohibited by law from taking any 
     action necessary to carry out the plan;
       (4) except to the extent that the holder of a particular 
     claim has agreed to a different treatment of such claim, the 
     plan provides that on the effective date of the plan each 
     holder of a claim of a kind specified in 507(a)(2) of title 
     11, United States Code, will receive on account of such claim 
     cash equal to the allowed amount of such claim;
       (5) any legislative, regulatory, or electoral approval 
     necessary under applicable law in order to carry out any 
     provision of the plan has been obtained, or such provision is 
     expressly conditioned on such approval;
       (6) the plan is feasible and in the best interests of 
     creditors, which shall require the court to consider whether 
     available remedies under the non-bankruptcy laws and 
     constitution of the territory would result in a greater 
     recovery for the creditors than is provided by such plan; and
       (7) the plan is consistent with the applicable Fiscal Plan 
     certified by the Oversight Board under title II.
       (c) Confirmation for Debtors With a Single Class of 
     Impaired Creditors.--If all of the requirements of section 
     314(b) of this title and section 1129(a) of title 11, United 
     States Code, incorporated into this title by section 301 
     other than sections 1129(a)(8) and 1129(a)(10) are met with 
     respect to a plan--
       (1) with respect to which all claims are substantially 
     similar under section 301(e) of this title;
       (2) that includes only one class of impaired claims; and
       (3) that was not accepted by such impaired class,

     the court shall confirm the plan notwithstanding the 
     requirements of such sections 1129(a)(8) and 1129(a)(10) of 
     title 11, United States Code if the plan is fair and 
     equitable with respect to such impaired class.

     SEC. 315. ROLE AND CAPACITY OF OVERSIGHT BOARD.

       (a) Actions of Oversight Board.--For the purposes of this 
     title, the Oversight Board may

[[Page 8418]]

     take any action necessary on behalf of the debtor to 
     prosecute the case of the debtor, including--
       (1) filing a petition under section 304 of this Act;
       (2) submitting or modifying a plan of adjustment under 
     sections 312 and 313; or
       (3) otherwise generally submitting filings in relation to 
     the case with the court.
       (b) Representative of Debtor.--The Oversight Board in a 
     case under this title is the representative of the debtor.

     SEC. 316. COMPENSATION OF PROFESSIONALS.

       (a) After notice to the parties in interest and the United 
     States Trustee and a hearing, the court may award to a 
     professional person employed by the debtor (in the debtor's 
     sole discretion), the Oversight Board (in the Oversight 
     Board's sole discretion), a committee under section 1103 of 
     title 11, United States Code, or a trustee appointed by the 
     court under section 926 of title 11, United States Code--
       (1) reasonable compensation for actual, necessary services 
     rendered by the professional person, or attorney and by any 
     paraprofessional person employed by any such person; and
       (2) reimbursement for actual, necessary expenses.
       (b) The court may, on its own motion or on the motion of 
     the United States Trustee or any other party in interest, 
     award compensation that is less than the amount of 
     compensation that is requested.
       (c) In determining the amount of reasonable compensation to 
     be awarded to a professional person, the court shall consider 
     the nature, the extent, and the value of such services, 
     taking into account all relevant factors, including--
       (1) the time spent on such services;
       (2) the rates charged for such services;
       (3) whether the services were necessary to the 
     administration of, or beneficial at the time at which the 
     service was rendered toward the completion of, a case under 
     this chapter;
       (4) whether the services were performed within a reasonable 
     amount of time commensurate with the complexity, importance, 
     and nature of the problem, issue, or task addressed;
       (5) with respect to a professional person, whether the 
     person is board certified or otherwise has demonstrated skill 
     and experience in the restructuring field; and
       (6) whether the compensation is reasonable based on the 
     customary compensation charged by comparably skilled 
     practitioners in cases other than cases under this title or 
     title 11, United States Code.
       (d) The court shall not allow compensation for--
       (1) unnecessary duplication of services; or
       (2) services that were not--
       (A) reasonably likely to benefit the debtor; or
       (B) necessary to the administration of the case.
       (e) The court shall reduce the amount of compensation 
     awarded under this section by the amount of any interim 
     compensation awarded under section 317 of this title, and, if 
     the amount of such interim compensation exceeds the amount of 
     compensation awarded under this section, may order the return 
     of the excess to the debtor.
       (f) Any compensation awarded for the preparation of a fee 
     application shall be based on the level and skill reasonably 
     required to prepare the application.

     SEC. 317. INTERIM COMPENSATION.

       A debtor's attorney, or any professional person employed by 
     the debtor (in the debtor's sole discretion), the Oversight 
     Board (in the Oversight Board's sole discretion), a committee 
     under section 1103 of title 11, United States Code, or a 
     trustee appointed by the court under section 926 of title 11, 
     United States Code, may apply to the court not more than once 
     every 120 days after an order for relief in a case under this 
     title, or more often if the court permits, for such 
     compensation for services rendered before the date of such an 
     application or reimbursement for expenses incurred before 
     such date as is provided under section 316 of this title.

                   TITLE IV--MISCELLANEOUS PROVISIONS

     SEC. 401. RULES OF CONSTRUCTION.

       Nothing in this Act is intended, or may be construed--
       (1) to limit the authority of Congress to exercise 
     legislative authority over the territories pursuant to 
     Article IV, section 3 of the Constitution of the United 
     States;
       (2) to authorize the application of section 104(f) of this 
     Act (relating to issuance of subpoenas) to judicial officers 
     or employees of territory courts;
       (3) to alter, amend, or abrogate any provision of the 
     Covenant To Establish a Commonwealth of the Northern Mariana 
     Islands in Political Union With the United States of America 
     (48 U.S.C. 1801 et seq.); or
       (4) to alter, amend, or abrogate the treaties of cession 
     regarding certain islands of American Samoa (48 U.S.C. 1661).

     SEC. 402. RIGHT OF PUERTO RICO TO DETERMINE ITS FUTURE 
                   POLITICAL STATUS.

       Nothing in this Act shall be interpreted to restrict Puerto 
     Rico's right to determine its future political status, 
     including by conducting the plebiscite as authorized by 
     Public Law 113-76.

     SEC. 403. FIRST MINIMUM WAGE IN PUERTO RICO.

       Section 6(g) of the Fair Labor Standards Act of 1938 (29 
     U.S.C. 206(g)) is amended by striking paragraphs (2) through 
     (4) and inserting the following:
       ``(2) In lieu of the rate prescribed by subsection (a)(1), 
     the Governor of Puerto Rico, subject to the approval of the 
     Financial Oversight and Management Board established pursuant 
     to section 101 of the Puerto Rico Oversight, Management, and 
     Economic Stability Act, may designate a time period not to 
     exceed four years during which employers in Puerto Rico may 
     pay employees who are initially employed after the date of 
     enactment of such Act a wage which is not less than the wage 
     described in paragraph (1). Notwithstanding the time period 
     designated, such wage shall not continue in effect after such 
     Board terminates in accordance with section 209 of such Act.
       ``(3) No employer may take any action to displace employees 
     (including partial displacements such as reduction in hours, 
     wages, or employment benefits) for purposes of hiring 
     individuals at the wage authorized in paragraph (1) or (2).
       ``(4) Any employer who violates this subsection shall be 
     considered to have violated section 15(a)(3).
       ``(5) This subsection shall only apply to an employee who 
     has not attained the age of 20 years, except in the case of 
     the wage applicable in Puerto Rico, 25 years, until such time 
     as the Board described in paragraph (2) terminates in 
     accordance with section 209 of the Act described in such 
     paragraph.''.

     SEC. 404. APPLICATION OF REGULATION TO PUERTO RICO.

       (a) Special Rule.--The regulations proposed by the 
     Secretary of Labor relating to exemptions regarding the rates 
     of pay for executive, administrative, professional, outside 
     sales, and computer employees, and published in a notice in 
     the Federal Register on July 6, 2015, and any final 
     regulations issued related to such notice, shall have no 
     force or effect in the Commonwealth of Puerto Rico until--
       (1) the Comptroller General of the United States completes 
     the assessment and transmits the report required under 
     subsection (b); and
       (2) the Secretary of Labor, taking into account the 
     assessment and report of the Comptroller General, provides a 
     written determination to Congress that applying such rule to 
     Puerto Rico would not have a negative impact on the economy 
     of Puerto Rico.
       (b) Assessment and Report.--Not later than two years after 
     the date of enactment of this Act, the Comptroller General 
     shall examine the economic conditions in Puerto Rico and 
     shall transmit a report to Congress assessing the impact of 
     applying the regulations described in subsection (a) to 
     Puerto Rico, taking into consideration regional, 
     metropolitan, and non-metropolitan salary and cost-of-living 
     differences.
       (c) Sense of Congress.--It is the sense of Congress that--
       (1) the Bureau of the Census should conduct a study to 
     determine the feasibility of expanding data collection to 
     include Puerto Rico and the other United States territories 
     in the Current Population Survey, which is jointly 
     administered by the Bureau of the Census and the Bureau of 
     Labor Statistics, and which is the primary source of labor 
     force statistics for the population of the United States; and
       (2) if necessary, the Bureau of the Census should request 
     the funding required to conduct this feasibility study as 
     part of its budget submission to Congress for fiscal year 
     2018.

     SEC. 405. AUTOMATIC STAY UPON ENACTMENT.

       (a) Definitions.--In this section:
       (1) Liability.--The term ``Liability'' means a bond, loan, 
     letter of credit, other borrowing title, obligation of 
     insurance, or other financial indebtedness for borrowed 
     money, including rights, entitlements, or obligations whether 
     such rights, entitlements, or obligations arise from 
     contract, statute, or any other source of law related to such 
     a bond, loan, letter of credit, other borrowing title, 
     obligation of insurance, or other financial indebtedness in 
     physical or dematerialized form, of which--
       (A) the issuer, obligor, or guarantor is the Government of 
     Puerto Rico; and
       (B) the date of issuance or incurrence precedes the date of 
     enactment of this Act.
       (2) Liability claim.--The term ``Liability Claim'' means, 
     as it relates to a Liability--
       (A) right to payment, whether or not such right is reduced 
     to judgment, liquidated, unliquidated, fixed, contingent, 
     matured, unmatured, disputed, undisputed, legal, equitable, 
     secured, or unsecured; or
       (B) right to an equitable remedy for breach of performance 
     if such breach gives rise to a right to payment, whether or 
     not such right to an equitable remedy is reduced to judgment, 
     fixed, contingent, matured, unmatured, disputed, undisputed, 
     secured, or unsecured.
       (b) In General.--Except as provided in subsection (c) of 
     this section, the establishment of an Oversight Board for 
     Puerto Rico (i.e., the enactment of this Act) in accordance 
     with section 101 operates with respect to a Liability as a 
     stay, applicable to all entities (as such term is defined in 
     section 101 of title 11, United States Code), of--
       (1) the commencement or continuation, including the 
     issuance or employment of process, of a judicial, 
     administrative, or other action or proceeding against the 
     Government of Puerto Rico that was or could have been 
     commenced before the enactment of this Act, or to recover a 
     Liability Claim against the Government of Puerto Rico that 
     arose before the enactment of this Act;
       (2) the enforcement, against the Government of Puerto Rico 
     or against property of the Government of Puerto Rico, of a 
     judgment obtained before the enactment of this Act;
       (3) any act to obtain possession of property of the 
     Government of Puerto Rico or of property from the Government 
     of Puerto Rico or to exercise control over property of the 
     Government of Puerto Rico;

[[Page 8419]]

       (4) any act to create, perfect, or enforce any lien against 
     property of the Government of Puerto Rico;
       (5) any act to create, perfect, or enforce against property 
     of the Government of Puerto Rico any lien to the extent that 
     such lien secures a Liability Claim that arose before the 
     enactment of this Act;
       (6) any act to collect, assess, or recover a Liability 
     Claim against the Government of Puerto Rico that arose before 
     the enactment of this Act; and
       (7) the setoff of any debt owing to the Government of 
     Puerto Rico that arose before the enactment of this Act 
     against any Liability Claim against the Government of Puerto 
     Rico.
       (c) Stay Not Operable.--The establishment of an Oversight 
     Board for Puerto Rico in accordance with section 101 does not 
     operate as a stay--
       (1) solely under subsection (b)(1) of this section, of the 
     continuation of, including the issuance or employment of 
     process, of a judicial, administrative, or other action or 
     proceeding against the Government of Puerto Rico that was 
     commenced on or before December 18, 2015; or
       (2) of the commencement or continuation of an action or 
     proceeding by a governmental unit to enforce such 
     governmental unit's or organization's police and regulatory 
     power, including the enforcement of a judgment other than a 
     money judgment, obtained in an action or proceeding by the 
     governmental unit to enforce such governmental unit's or 
     organization's police or regulatory power.
       (d) Continuation of Stay.--Except as provided in 
     subsections (e), (f), and (g) the stay under subsection (b) 
     continues until the earlier of--
       (1) the later of--
       (A) the later of--
       (i) February 15, 2017; or
       (ii) six months after the establishment of an Oversight 
     Board for Puerto Rico as established by section 101(b);
       (B) the date that is 75 days after the date in subparagraph 
     (A) if the Oversight Board delivers a certification to the 
     Governor that, in the Oversight Board's sole discretion, an 
     additional 75 days are needed to seek to complete a voluntary 
     process under title VI of this Act with respect to the 
     government of the Commonwealth of Puerto Rico or any of its 
     territorial instrumentalities; or
       (C) the date that is 60 days after the date in subparagraph 
     (A) if the district court to which an application has been 
     submitted under subparagraph 601(m)(1)(D) of this Act 
     determines, in the exercise of the court's equitable powers, 
     that an additional 60 days are needed to complete a voluntary 
     process under title VI of this Act with respect to the 
     government of the Commonwealth of Puerto Rico or any of its 
     territorial instrumentalities; or
       (2) with respect to the government of the Commonwealth of 
     Puerto Rico or any of its territorial instrumentalities, the 
     date on which a case is filed by or on behalf of the 
     government of the Commonwealth of Puerto Rico or any of its 
     territorial instrumentalities, as applicable, under title 
     III.
       (e) Jurisdiction, Relief From Stay.--
       (1) The United States District Court for the District of 
     Puerto Rico shall have original and exclusive jurisdiction of 
     any civil actions arising under or related to this section.
       (2) On motion of or action filed by a party in interest and 
     after notice and a hearing, the United States District Court 
     for the District of Puerto Rico, for cause shown, shall grant 
     relief from the stay provided under subsection (b) of this 
     section.
       (f) Termination of Stay; Hearing.--Forty-five days after a 
     request under subsection (e)(2) for relief from the stay of 
     any act against property of the Government of Puerto Rico 
     under subsection (b), such stay is terminated with respect to 
     the party in interest making such request, unless the court, 
     after notice and a hearing, orders such stay continued in 
     effect pending the conclusion of, or as a result of, a final 
     hearing and determination under subsection (e)(2). A hearing 
     under this subsection may be a preliminary hearing, or may be 
     consolidated with the final hearing under subsection (e)(2). 
     The court shall order such stay continued in effect pending 
     the conclusion of the final hearing under subsection (e)(2) 
     if there is a reasonable likelihood that the party opposing 
     relief from such stay will prevail at the conclusion of such 
     final hearing. If the hearing under this subsection is a 
     preliminary hearing, then such final hearing shall be 
     concluded not later than thirty days after the conclusion of 
     such preliminary hearing, unless the thirty-day period is 
     extended with the consent of the parties in interest or for a 
     specific time which the court finds is required by compelling 
     circumstances.
       (g) Relief To Prevent Irreparable Damage.--Upon request of 
     a party in interest, the court, with or without a hearing, 
     shall grant such relief from the stay provided under 
     subsection (b) as is necessary to prevent irreparable damage 
     to the interest of an entity in property, if such interest 
     will suffer such damage before there is an opportunity for 
     notice and a hearing under subsection (e) or (f).
       (h) Act in Violation of Stay Is Void.--Any order, judgment, 
     or decree entered in violation of this section and any act 
     taken in violation of this section is void, and shall have no 
     force or effect, and any person found to violate this section 
     may be liable for damages, costs, and attorneys' fees 
     incurred in defending any action taken in violation of this 
     section, and the Oversight Board or the Government of Puerto 
     Rico may seek an order from the court enforcing the 
     provisions of this section.
       (i) Government of Puerto Rico.--For purposes of this 
     section, the term ``Government of Puerto Rico'', in addition 
     to the definition set forth in section 5(11) of this Act, 
     shall include--
       (1) the individuals, including elected and appointed 
     officials, directors, officers of and employees acting in 
     their official capacity on behalf of the Government of Puerto 
     Rico; and
       (2) the Oversight Board, including the directors and 
     officers of and employees acting in their official capacity 
     on behalf of the Oversight Board.
       (j) No Default Under Existing Contracts.--
       (1) Notwithstanding any contractual provision or applicable 
     law to the contrary and so long as a stay under this section 
     is in effect, the holder of a Liability Claim or any other 
     claim (as such term is defined in section 101 of title 11, 
     United States Code) may not exercise or continue to exercise 
     any remedy under a contract or applicable law in respect to 
     the Government of Puerto Rico or any of its property--
       (A) that is conditioned upon the financial condition of, or 
     the commencement of a restructuring, insolvency, bankruptcy, 
     or other proceeding (or a similar or analogous process) by, 
     the Government of Puerto Rico, including a default or an 
     event of default thereunder; or
       (B) with respect to Liability Claims--
       (i) for the non-payment of principal or interest; or
       (ii) for the breach of any condition or covenant.
       (2) The term ``remedy'' as used in paragraph (1) shall be 
     interpreted broadly, and shall include any right existing in 
     law or contract, including any right to--
       (A) setoff;
       (B) apply or appropriate funds;
       (C) seek the appointment of a custodian (as such term is 
     defined in section 101(11) of title 11, United States Code);
       (D) seek to raise rates; or
       (E) exercise control over property of the Government of 
     Puerto Rico.
       (3) Notwithstanding any contractual provision or applicable 
     law to the contrary and so long as a stay under this section 
     is in effect, a contract to which the Government of Puerto 
     Rico is a party may not be terminated or modified, and any 
     right or obligation under such contract may not be terminated 
     or modified, solely because of a provision in such contract 
     is conditioned on--
       (A) the insolvency or financial condition of the Government 
     of Puerto Rico at any time prior to the enactment of this 
     Act;
       (B) the adoption of a resolution or establishment of an 
     Oversight Board pursuant to section 101 of this Act; or
       (C) a default under a separate contract that is due to, 
     triggered by, or a result of the occurrence of the events or 
     matters in paragraph (1)(B).
       (4) Notwithstanding any contractual provision to the 
     contrary and so long as a stay under this section is in 
     effect, a counterparty to a contract with the Government of 
     Puerto Rico for the provision of goods and services shall, 
     unless the Government of Puerto Rico agrees to the contrary 
     in writing, continue to perform all obligations under, and 
     comply with the terms of, such contract, provided that the 
     Government of Puerto Rico is not in default under such 
     contract other than as a result of a condition specified in 
     paragraph (3).
       (k) Effect.--This section does not discharge an obligation 
     of the Government of Puerto Rico or release, invalidate, or 
     impair any security interest or lien securing such 
     obligation. This section does not impair or affect the 
     implementation of any restructuring support agreement 
     executed by the Government of Puerto Rico to be implemented 
     pursuant to Puerto Rico law specifically enacted for that 
     purpose prior to the enactment of this Act or the obligation 
     of the Government of Puerto Rico to proceed in good faith as 
     set forth in any such agreement.
       (l) Payments on Liabilities.--Nothing in this section shall 
     be construed to prohibit the Government of Puerto Rico from 
     making any payment on any Liability when such payment becomes 
     due during the term of the stay, and to the extent the 
     Oversight Board, in its sole discretion, determines it is 
     feasible, the Government of Puerto Rico shall make interest 
     payments on outstanding indebtedness when such payments 
     become due during the length of the stay.
       (m) Findings.--Congress finds the following:
       (1) A combination of severe economic decline, and, at 
     times, accumulated operating deficits, lack of financial 
     transparency, management inefficiencies, and excessive 
     borrowing has created a fiscal emergency in Puerto Rico.
       (2) As a result of its fiscal emergency, the Government of 
     Puerto Rico has been unable to provide its citizens with 
     effective services.
       (3) The current fiscal emergency has also affected the 
     long-term economic stability of Puerto Rico by contributing 
     to the accelerated outmigration of residents and businesses.
       (4) A comprehensive approach to fiscal, management, and 
     structural problems and adjustments that exempts no part of 
     the Government of Puerto Rico is necessary, involving 
     independent oversight and a Federal statutory authority for 
     the Government of Puerto Rico to restructure debts in a fair 
     and orderly process.
       (5) Additionally, an immediate--but temporary--stay is 
     essential to stabilize the region for the purposes of 
     resolving this territorial crisis.
       (A) The stay advances the best interests common to all 
     stakeholders, including but not limited to a functioning 
     independent Oversight

[[Page 8420]]

     Board created pursuant to this Act to determine whether to 
     appear or intervene on behalf of the Government of Puerto 
     Rico in any litigation that may have been commenced prior to 
     the effectiveness or upon expiration of the stay.
       (B) The stay is limited in nature and narrowly tailored to 
     achieve the purposes of this Act, including to ensure all 
     creditors have a fair opportunity to consensually renegotiate 
     terms of repayment based on accurate financial information 
     that is reviewed by an independent authority or, at a 
     minimum, receive a recovery from the Government of Puerto 
     Rico equal to their best possible outcome absent the 
     provisions of this Act.
       (6) Finally, the ability of the Government of Puerto Rico 
     to obtain funds from capital markets in the future will be 
     severely diminished without congressional action to restore 
     its financial accountability and stability.
       (n) Purposes.--The purposes of this section are to--
       (1) provide the Government of Puerto Rico with the 
     resources and the tools it needs to address an immediate 
     existing and imminent crisis;
       (2) allow the Government of Puerto Rico a limited period of 
     time during which it can focus its resources on negotiating a 
     voluntary resolution with its creditors instead of defending 
     numerous, costly creditor lawsuits;
       (3) provide an oversight mechanism to assist the Government 
     of Puerto Rico in reforming its fiscal governance and support 
     the implementation of potential debt restructuring;
       (4) make available a Federal restructuring authority, if 
     necessary, to allow for an orderly adjustment of all of the 
     Government of Puerto Rico's liabilities; and
       (5) benefit the lives of 3.5 million American citizens 
     living in Puerto Rico by encouraging the Government of Puerto 
     Rico to resolve its longstanding fiscal governance issues and 
     return to economic growth.
       (o) Voting on Voluntary Agreements Not Stayed.--
     Notwithstanding any provision in this section to the 
     contrary, nothing in this section shall prevent the holder of 
     a Liability Claim from voting on or consenting to a proposed 
     modification of such Liability Claim under title VI of this 
     Act.

     SEC. 406. PURCHASES BY TERRITORY GOVERNMENTS.

       The text of section 302 of the Omnibus Insular Areas Act of 
     1992 (48 U.S.C. 1469e), is amended to read as follows: ``The 
     Governments of the Commonwealth of Puerto Rico, Guam, 
     American Samoa, the Commonwealth of the Northern Mariana 
     Islands, and the United States Virgin Islands are authorized 
     to make purchases through the General Services 
     Administration.''.

     SEC. 407. PROTECTION FROM INTER-DEBTOR TRANSFERS.

       (a) Protection of Creditors.--While an Oversight Board for 
     Puerto Rico is in existence, if any property of any 
     territorial instrumentality of Puerto Rico is transferred in 
     violation of applicable law under which any creditor has a 
     valid pledge of, security interest in, or lien on such 
     property, or which deprives any such territorial 
     instrumentality of property in violation of applicable law 
     assuring the transfer of such property to such territorial 
     instrumentality for the benefit of its creditors, then the 
     transferee shall be liable for the value of such property.
       (b) Enforceability.--A creditor may enforce rights under 
     this section by bringing an action in the United States 
     District Court for the District of Puerto Rico after the 
     expiration or lifting of the stay of section 405, unless a 
     stay under title III is in effect.

     SEC. 408. GAO REPORT ON SMALL BUSINESS ADMINISTRATION 
                   PROGRAMS IN PUERTO RICO.

       Section 15 of the Small Business Act (15 U.S.C. 644) is 
     amended by adding at the end the following new subsection:
       ``(t) GAO Report on Small Business Administration Programs 
     in Puerto Rico.--Not later than 180 days after the date of 
     enactment of this subsection, the Comptroller General of the 
     United States shall submit to the Committee on Small Business 
     of the House of Representatives and the Committee on Small 
     Business and Entrepreneurship of the Senate a report on the 
     application and utilization of contracting activities of the 
     Administration (including contracting activities relating to 
     HUBZone small business concerns) in Puerto Rico. The report 
     shall also identify any provisions of Federal law that may 
     create an obstacle to the efficient implementation of such 
     contracting activities.''.

     SEC. 409. CONGRESSIONAL TASK FORCE ON ECONOMIC GROWTH IN 
                   PUERTO RICO.

       (a) Establishment.--There is established within the 
     legislative branch a Congressional Task Force on Economic 
     Growth in Puerto Rico (hereinafter referred to as the ``Task 
     Force'').
       (b) Membership.--The Task Force shall be composed of eight 
     members as follows:
       (1) One member of the House of Representatives, who shall 
     be appointed by the Speaker of the House of Representatives, 
     in coordination with the Chairman of the Committee on Natural 
     Resources of the House of Representatives.
       (2) One member of the House of Representatives, who shall 
     be appointed by the Speaker of the House of Representatives, 
     in coordination with the Chairman of the Committee on Ways 
     and Means of the House of Representatives.
       (3) One member of the House of Representatives, who shall 
     be appointed by the Minority Leader of the House of 
     Representatives, in coordination with the ranking minority 
     member of the Committee on Natural Resources of the House of 
     Representatives.
       (4) One member of the House of Representatives, who shall 
     be appointed by the Minority Leader of the House of 
     Representatives, in coordination with the ranking minority 
     member of the Committee on Ways and Means of the House of 
     Representatives.
       (5) One member of the Senate, who shall be appointed by the 
     Majority Leader of the Senate, in coordination with the 
     Chairman of the Committee on Energy and Natural Resources of 
     the Senate.
       (6) One member of the Senate, who shall be appointed by the 
     Majority Leader of the Senate, in coordination with the 
     Chairman of the Committee on Finance of the Senate.
       (7) One member of the Senate, who shall be appointed by the 
     Minority Leader of the Senate, in coordination with the 
     ranking minority member of the Committee on Energy and 
     Natural Resources of the Senate.
       (8) One member of the Senate, who shall be appointed by the 
     Minority Leader of the Senate, in coordination with the 
     ranking minority member of the Committee on Finance of the 
     Senate.
       (c) Deadline for Appointment.--All appointments to the Task 
     Force shall be made not later than 15 days after the date of 
     enactment of this Act.
       (d) Chair.--The Speaker shall designate one Member to serve 
     as chair of the Task Force.
       (e) Vacancies.--Any vacancy in the Task Force shall be 
     filled in the same manner as the original appointment.
       (f) Status Update.--Between September 1, 2016, and 
     September 15, 2016, the Task Force shall provide a status 
     update to the House and Senate that includes--
       (1) information the Task Force has collected; and
       (2) a discussion on matters the chairman of the Task Force 
     deems urgent for consideration by Congress.
       (g) Report.--Not later than December 31, 2016, the Task 
     Force shall issue a report of its findings to the House and 
     Senate regarding--
       (1) impediments in current Federal law and programs to 
     economic growth in Puerto Rico including equitable access to 
     Federal health care programs;
       (2) recommended changes to Federal law and programs that, 
     if adopted, would serve to spur sustainable long-term 
     economic growth, job creation and attract investment in 
     Puerto Rico;
       (3) the economic effect of Administrative Order No. 346 of 
     the Department of Health of the Commonwealth of Puerto Rico 
     (relating to natural products, natural supplements, and 
     dietary supplements) or any successor or substantially 
     similar order, rule, or guidance of the Commonwealth of 
     Puerto Rico; and
       (4) additional information the Task Force deems 
     appropriate.
       (h) Consensus Views.--To the greatest extent practicable, 
     the report issued under subsection (f) shall reflect the 
     shared views of all eight Members, except that the report may 
     contain dissenting views.
       (i) Hearings and Sessions.--The Task Force may, for the 
     purpose of carrying out this section, hold hearings, sit and 
     act at times and places, take testimony, and receive evidence 
     as the Task Force considers appropriate. If the Task Force 
     holds hearings, at least one such hearing must be held in 
     Puerto Rico.
       (j) Stakeholder Participation.--In carrying out its duties, 
     the Task Force shall consult with the Puerto Rico Legislative 
     Assembly, the Puerto Rico Department of Economic Development 
     and Commerce, and the private sector of Puerto Rico.
       (k) Resources.--The Task Force shall carry out its duties 
     by utilizing existing facilities, services, and staff of the 
     House of Representatives and Senate, except that no 
     additional funds are authorized to be appropriated to carry 
     out this section.
       (l) Termination.--The Task Force shall terminate upon 
     issuing the report required under subsection (f).

     SEC. 410. REPORT.

       The Comptroller General shall submit a report to the 
     Committee on Natural Resources of the House of 
     Representatives and the Committee on Energy and Natural 
     Resources of the Senate describing--
       (1) the conditions which led to the level of debt per 
     capita and based upon overall economic activity;
       (2) how actions of the territorial government improved or 
     impaired the territory's financial conditions; and
       (3) recommendations on non-fiscal actions, nor policies 
     that would imperil America's homeland and national security, 
     that could be taken by Congress or the Administration to 
     avert future indebtedness of territories, States or local 
     units of government while respecting sovereignty and 
     constitutional parameters.

           TITLE V--PUERTO RICO INFRASTRUCTURE REVITALIZATION

     SEC. 501. DEFINITIONS.

       In this title:
       (1) Act 76.--The term ``Act 76'' means Puerto Rico Act 76-
     2000 (3 L.P.R.A. 1931 et seq.), approved on May 5, 2000, as 
     amended.
       (2) Critical project.--The term ``Critical Project'' means 
     a project identified under the provisions of this title and 
     intimately related to addressing an emergency whose approval, 
     consideration, permitting, and implementation shall be 
     expedited and streamlined according to the statutory process 
     provided by Act 76, or otherwise adopted pursuant to this 
     title.
       (3) Energy commission of puerto rico.--The term ``Energy 
     Commission of Puerto Rico'' means the Puerto Rico Energy 
     Commission as established by Subtitle B of Puerto Rico Act 
     57-2014.
       (4) Energy projects.--The term ``Energy Projects'' means 
     those projects addressing the

[[Page 8421]]

     generation, distribution, or transmission of energy.
       (5) Emergency.--The term ``emergency'' means any event or 
     grave problem of deterioration in the physical infrastructure 
     for the rendering of essential services to the people, or 
     that endangers the life, public health, or safety of the 
     population or of a sensitive ecosystem, or as otherwise 
     defined by section 1 of Act 76 (3 L.P.R.A. 1931). This shall 
     include problems in the physical infrastructure for energy, 
     water, sewer, solid waste, highways or roads, ports, 
     telecommunications, and other similar infrastructure.
       (6) Environmental quality board.--The term ``Environmental 
     Quality Board'' means the Puerto Rico Environmental Quality 
     Board, a board within the executive branch of the Government 
     of Puerto Rico as established by section 7 of Puerto Rico Act 
     416-2004 (12 L.P.R.A. 8002a).
       (7) Expedited permitting process.--The term ``Expedited 
     Permitting Process'' means a Puerto Rico Agency's alternate 
     procedures, conditions, and terms mirroring those established 
     under Act 76 (3 L.P.R.A. 1932) and pursuant to this title 
     shall not apply to any Federal law, statute, or requirement.
       (8) Governor.--The term ``Governor'' means the Governor of 
     Puerto Rico.
       (9) Interagency environmental subcommittee.--The term 
     ``Interagency Environmental Subcommittee'' means the 
     Interagency Subcommittee on Expedited Environmental 
     Regulations as further described by section 504.
       (10) Legislature.--The term ``Legislature'' means the 
     Legislature of Puerto Rico.
       (11) Planning board.--The term ``Planning Board'' means the 
     Puerto Rico Planning Board, a board within the executive 
     branch of the Government of Puerto Rico established by Puerto 
     Rico Act 75-1975 (23 L.P.R.A. 62 et seq.).
       (12) Project sponsor.--The term ``Project Sponsor'' means a 
     Puerto Rico Agency or private party proposing the development 
     of an existing, ongoing, or new infrastructure project or 
     Energy Project.
       (13) Puerto rico agency or agencies.--The terms ``Puerto 
     Rico Agency'' or ``Puerto Rico Agencies'' means any board, 
     body, board of examiners, public corporation, commission, 
     independent office, division, administration, bureau, 
     department, authority, official, person, entity, 
     municipality, or any instrumentality of Puerto Rico, or an 
     administrative body authorized by law to perform duties of 
     regulating, investigating, or that may issue a decision, or 
     with the power to issue licenses, certificates, permits, 
     concessions, accreditations, privileges, franchises, except 
     the Senate and the House of Representatives of the 
     Legislature and the judicial branch.
       (14) Puerto rico electric power authority.--The term 
     ``Puerto Rico Electric Power Authority'' means the Puerto 
     Rico Electric Power Authority established by Puerto Rico Act 
     83-1941.

     SEC. 502. POSITION OF REVITALIZATION COORDINATOR.

       (a) Establishment.--There is established, under the 
     Oversight Board, the position of the Revitalization 
     Coordinator.
       (b) Appointment.--
       (1) In general.--The Revitalization Coordinator shall be 
     appointed by the Governor as follows:
       (A) Prior to the appointment of the Revitalization 
     Coordinator and within 60 days of the appointment of the full 
     membership of the Oversight Board, the Oversight Board shall 
     submit to the Governor no less than three nominees for 
     appointment.
       (B) In consultation with the Oversight Board, not later 
     than 10 days after receiving the nominations under 
     subparagraph (A), the Governor shall appoint one of the 
     nominees as the Revitalization Coordinator. Such appointment 
     shall be effective immediately.
       (C) If the Governor fails to select a Revitalization 
     Coordinator, the Oversight Board shall, by majority vote, 
     appoint a Revitalization Coordinator from the list of 
     nominees provided under paragraph (A).
       (2) Qualifications.--In selecting nominees under paragraph 
     (1)(A), the Oversight Board shall only nominate persons who--
       (A) have substantial knowledge and expertise in the 
     planning, predevelopment, financing, development, operations, 
     engineering, or market participation of infrastructure 
     projects, provided that stronger consideration may be given 
     to candidates who have experience with Energy Projects and 
     the laws and regulations of Puerto Rico that may be subject 
     to an Expedited Permitting Process;
       (B) does not currently provide, or in the preceding 3 
     calendar years provided, goods or services to the government 
     of Puerto Rico (and, as applicable, is not the spouse, 
     parent, child, or sibling of a person who provides or has 
     provided goods and services to the government of Puerto Rico 
     in the preceding 3 calendar years); and
       (C) shall not be an officer, employee of, or former officer 
     or employee of the government of Puerto Rico in the preceding 
     3 calendar years.
       (3) Compensation.--The Revitalization Coordinator shall be 
     compensated at an annual rate determined by the Oversight 
     Board sufficient in the judgment of the Oversight Board to 
     obtain the services of a person with the skills and 
     experience required to discharge the duties of the position, 
     but such compensation shall not exceed the annual salary of 
     the Executive Director.
       (c) Assignment of Personnel.--The Executive Director of the 
     Oversight Board may assign Oversight Board personnel to 
     assist the Revitalization Coordinator.
       (d) Removal.--
       (1) In general.--The Revitalization Coordinator may be 
     removed for any reason, in the Oversight Board's discretion.
       (2) Termination of position.--Upon the termination of the 
     Oversight Board pursuant to section 209 of this Act, the 
     position of the Revitalization Coordinator shall terminate.

     SEC. 503. CRITICAL PROJECTS.

       (a) Identification of Projects.--
       (1) Project submission.--Any Project Sponsor may submit, so 
     long as the Oversight Board is in operation, any existing, 
     ongoing, or proposed project to the Revitalization 
     Coordinator. The Revitalization Coordinator shall require 
     such submission to include--
       (A) the impact the project will have on an emergency;
       (B) the availability of immediate private capital or other 
     funds, including loan guarantees, loans, or grants to 
     implement, operate, or maintain the project;
       (C) the cost of the project and amount of Puerto Rico 
     government funds, if any, necessary to complete and maintain 
     the project;
       (D) the environmental and economic benefits provided by the 
     project, including the number of jobs to be created that will 
     be held by residents of Puerto Rico and the expected economic 
     impact, including the impact on ratepayers, if applicable;
       (E) the status of the project if it is existing or ongoing; 
     and
       (F) in addition to the requirements found in subparagraphs 
     (A) through (E), the Revitalization Coordinator may require 
     such submission to include any or all of the following 
     criteria that assess how the project will--
       (i) reduce reliance on oil for electric generation in 
     Puerto Rico;
       (ii) improve performance of energy infrastructure and 
     overall energy efficiency;
       (iii) expedite the diversification and conversion of fuel 
     sources for electric generation from oil to natural gas and 
     renewables in Puerto Rico as defined under applicable Puerto 
     Rico laws;
       (iv) promote the development and utilization of energy 
     sources found on Puerto Rico;
       (v) contribute to transitioning to privatized generation 
     capacities in Puerto Rico;
       (vi) support the Energy Commission of Puerto Rico in 
     achievement of its goal of reducing energy costs and ensuring 
     affordable energy rates for consumers and business; or
       (vii) achieve in whole or in part the recommendations, if 
     feasible, of the study in section 505(d) of this title to the 
     extent such study is completed and not inconsistent with 
     studies or plans otherwise required under Puerto Rico laws.
       (2) Identification of relevant puerto rico agencies.--
     Within 20 days of receiving a project submission under 
     paragraph (1), the Revitalization Coordinator shall, in 
     consultation with the Governor, identify all Puerto Rico 
     Agencies that will have a role in the permitting, approval, 
     authorizing, or other activity related to the development of 
     such project submission.
       (3) Expedited permitting process.--
       (A) Submission of expedited permitting process.--Not later 
     than 20 days after receiving a project submission, each 
     Puerto Rico Agency identified in paragraph (1) shall submit 
     to the Revitalization Coordinator the Agency's Expedited 
     Permitting Process.
       (B) Failure to provide expedited permitting process.--If a 
     Puerto Rico Agency fails to provide an Expedited Permitting 
     Process within 20 days of receiving a project submission, the 
     Revitalization Coordinator shall consult with the Governor to 
     develop within 20 days an Expedited Permitting Process for 
     the Agency.
       (C) Implementation and prioritization.--The Revitalization 
     Coordinator shall require Puerto Rico Agencies to implement 
     the Expedited Permitting Process for Critical Projects. 
     Critical Projects shall be prioritized to the maximum extent 
     possible in each Puerto Rico Agency regardless of any 
     agreements transferring or delegating permitting authority to 
     any other Territorial Instrumentality or municipality.
       (b) Critical Project Report.--
       (1) In general.--For each submitted project, the 
     Revitalization Coordinator in consultation with the Governor 
     and relevant Puerto Rico Agencies identified in subsection 
     (a)(2) shall develop a Critical Project Report within 60 days 
     of the project submission, which shall include:
       (A) An assessment of how well the project meets the 
     criteria in subsection (a)(1).
       (B) A recommendation by the Governor whether the project 
     should be considered a Critical Project. If the Governor 
     fails to provide a recommendation during the development of 
     the Critical Project Report, the failure shall constitute a 
     concurrence with the Revitalization Coordinator's 
     recommendation in subparagraph (E).
       (C) In the case of a project that may affect the 
     implementation of Land-Use Plans, as defined by Puerto Rico 
     Act 550-2004, a determination by the Planning Board will be 
     required within the 60-day timeframe. If the Planning Board 
     determines such project will be inconsistent with relevant 
     Land-Use Plans, then the project will be deemed ineligible 
     for Critical Project designation.
       (D) In the case of an Energy Project that will connect with 
     the Puerto Rico Electric Power Authority's transmission or 
     distribution facilities, a recommendation by the Energy 
     Commission of Puerto Rico, if the Energy Commission 
     determines such Energy Project will affect an approved 
     Integrated Resource Plan, as defined under Puerto Rico Act 
     54-2014. If the Energy Commission determines the Energy 
     Project will

[[Page 8422]]

     adversely affect an approved Integrated Resource Plan, then 
     the Energy Commission shall provide the reasons for such 
     determination and the Energy Project shall be ineligible for 
     Critical Project designation, provided that such 
     determination must be made during the 60-day timeframe for 
     the development of the Critical Project Report.
       (E) A recommendation by the Revitalization Coordinator 
     whether the project should be considered a Critical Project.
       (2) Public involvement.--Immediately following the 
     completion of the Critical Project Report, the Revitalization 
     Coordinator shall make such Critical Project Report public 
     and allow a period of 30 days for the submission of comments 
     by residents of Puerto Rico specifically on matters relating 
     to the designation of a project as a Critical Project. The 
     Revitalization Coordinator shall respond to the comments 
     within 30 days of closing the coming period and make the 
     responses publicly available.
       (3) Submission to oversight board.--Not later than 5 days 
     after the Revitalization Coordinator has responded to the 
     comments under paragraph (2), the Revitalization Coordinator 
     shall submit the Critical Project Report to the Oversight 
     Board.
       (c) Action by the Oversight Board.--Not later than 30 days 
     after receiving the Critical Project Report, the Oversight 
     Board, by majority vote, shall approve or disapprove the 
     project as a Critical Project, if the Oversight Board--
       (1) approves the project, the project shall be deemed a 
     Critical Project; and
       (2) disapproves the project, the Oversight Board shall 
     submit to the Revitalization Coordinator in writing the 
     reasons for disapproval.

     SEC. 504. MISCELLANEOUS PROVISIONS.

       (a) Creation of Interagency Environmental Subcommittee.--
       (1) Establishment.--Not later than 60 days after the date 
     on which the Revitalization Coordinator is appointed, the 
     Interagency Environmental Subcommittee shall be established 
     and shall evaluate environmental documents required under 
     Puerto Rico law for any Critical Project within the Expedited 
     Permitting Process established by the Revitalization 
     Coordinator under section 503(a)(3).
       (2) Composition.--The Interagency Environmental 
     Subcommittee shall consist of the Revitalization Coordinator, 
     and a representative selected by the Governor in consultation 
     with the Revitalization Coordinator representing each of the 
     following agencies: The Environmental Quality Board, the 
     Planning Board, the Puerto Rico Department of Natural and 
     Environmental Resources, and any other Puerto Rico Agency 
     determined to be relevant by the Revitalization Coordinator.
       (b) Length of Expedited Permitting Process.--With respect 
     to a Puerto Rico Agency's activities related only to a 
     Critical Project, such Puerto Rico Agency shall operate as if 
     the Governor has declared an emergency pursuant to section 2 
     of Act 76 (3 L.P.R.A. 1932). Section 12 of Act 76 (3 L.P.R.A. 
     1942) shall not be applicable to Critical Projects. 
     Furthermore, any transactions, processes, projects, works, or 
     programs essential to the completion of a Critical Project 
     shall continue to be processed and completed under such 
     Expedited Permitting Process regardless of the termination of 
     the Oversight Board under section 209.
       (c) Expedited Permitting Process Compliance.--
       (1) Written notice.--A Critical Project Sponsor may in 
     writing notify the Oversight Board of the failure of a Puerto 
     Rico Agency or the Revitalization Coordinator to adhere to 
     the Expedited Permitting Process.
       (2) Finding of failure.--If the Oversight Board finds 
     either the Puerto Rico Agency or Revitalization Coordinator 
     has failed to adhere to the Expedited Permitting Process, the 
     Oversight Board shall direct the offending party to comply 
     with the Expedited Permitting Process. The Oversight Board 
     may take such enforcement action as necessary as provided by 
     section 104(l).
       (d) Review of Legislature Acts.--
       (1) Submission of acts to oversight board.--Pursuant to 
     section 204(a), the Governor shall submit to the Oversight 
     Board any law duly enacted during any fiscal year in which 
     the Oversight Board is in operation that may affect the 
     Expedited Permitting Process.
       (2) Finding of oversight board.--Upon receipt of a law 
     under paragraph (1), the Oversight Board shall promptly 
     review whether the law would adversely impact the Expedited 
     Permitting Process and, upon such a finding, the Oversight 
     Board may deem such law to be significantly inconsistent with 
     the applicable Fiscal Plan.
       (e) Establishment of Certain Terms and Conditions.--No 
     Puerto Rico Agency may include in any certificate, right-of-
     way, permit, lease, or other authorization issued for a 
     Critical Project any term or condition that may be permitted, 
     but is not required, by any applicable Puerto Rico law, if 
     the Revitalization Coordinator determines the term or 
     condition would prevent or impair the expeditious 
     construction, operation, or expansion of the Critical 
     Project. The Revitalization Coordinator may request a Puerto 
     Rico Agency to include in any certificate, right-of-way, 
     permit, lease, or other authorization, a term or condition 
     that may be permitted in accordance with applicable laws if 
     the Revitalization Coordinator determines such inclusion 
     would support the expeditious construction, operation, or 
     expansion of any Critical Project.
       (f) Disclosure.--All Critical Project reports, and 
     justifications for approval or rejection of Critical Project 
     status, shall be made publicly available online within 5 days 
     of receipt or completion.

     SEC. 505. FEDERAL AGENCY REQUIREMENTS.

       (a) Federal Points of Contact.--At the request of the 
     Revitalization Coordinator and within 30 days of receiving 
     such a request, each Federal agency with jurisdiction over 
     the permitting, or administrative or environmental review of 
     private or public projects in Puerto Rico, shall name a Point 
     of Contact who will serve as that agency's liaison with the 
     Revitalization Coordinator.
       (b) Federal Grants and Loans.--For each Critical Project 
     with a pending or potential Federal grant, loan, or loan 
     guarantee application, the Revitalization Coordinator and the 
     relevant Point of Contact shall cooperate with each other to 
     ensure expeditious review of such application.
       (c) Expedited Reviews and Actions of Federal Agencies.--All 
     reviews conducted and actions taken by any Federal agency 
     relating to a Critical Project shall be expedited in a manner 
     consistent with completion of the necessary reviews and 
     approvals by the deadlines under the Expedited Permitting 
     Process, but in no way shall the deadlines established 
     through the Expedited Permitting Process be binding on any 
     Federal agency.
       (d) Transfer of Study of Electric Rates.--Section 9 of the 
     Consolidated and Further Continuing Appropriations Act, 2015 
     (48 U.S.C. 1492a) is amended--
       (1) in subsection (a)(5), by inserting ``, except that, 
     with respect to Puerto Rico, the term means, the Secretary of 
     Energy'' after ``Secretary of the Interior''; and
       (2) in subsection (b)--
       (A) by inserting ``(except in the case of Puerto Rico, in 
     which case not later than 270 days after the date of 
     enactment of the Puerto Rico Oversight, Management, and 
     Economic Stability Act)'' after ``of this Act''; and
       (B) by inserting ``(except in the case of Puerto Rico)'' 
     after ``Empowering Insular Communities activity''.

     SEC. 506. JUDICIAL REVIEW.

       (a) Deadline for Filing of a Claim.--A claim arising under 
     this title must be brought no later than 30 days after the 
     date of the decision or action giving rise to the claim.
       (b) Expedited Consideration.--The District Court for the 
     District of Puerto Rico shall set any action brought under 
     this title for expedited consideration, taking into account 
     the interest of enhancing Puerto Rico's infrastructure for 
     electricity, water and sewer services, roads and bridges, 
     ports, and solid waste management to achieve compliance with 
     local and Federal environmental laws, regulations, and 
     policies while ensuring the continuity of adequate services 
     to the people of Puerto Rico and Puerto Rico's sustainable 
     economic development.

     SEC. 507. SAVINGS CLAUSE.

       Nothing in this title is intended to change or alter any 
     Federal legal requirements or laws.

                  TITLE VI--CREDITOR COLLECTIVE ACTION

     SEC. 601. CREDITOR COLLECTIVE ACTION.

       (a) Definitions.--In this title:
       (1) Administrative supervisor.--The term ``Administrative 
     Supervisor'' means the Oversight Board established under 
     section 101.
       (2) Authorized territorial instrumentality.--The term 
     ``Authorized Territorial Instrumentality'' means a covered 
     territorial instrumentality authorized in accordance with 
     subsection (e).
       (3) Calculation agent.--The term ``Calculation Agent'' 
     means a calculation agent appointed in accordance with 
     subsection (k).
       (4) Capital appreciation bond.--The term ``Capital 
     Appreciation Bond'' means a Bond that does not pay interest 
     on a current basis, but for which interest amounts are added 
     to principal over time as specified in the relevant offering 
     materials for such Bond, including that the accreted interest 
     amount added to principal increases daily.
       (5) Convertible capital appreciation bond.--The term 
     ``Convertible Capital Appreciation Bond'' means a Bond that 
     does not pay interest on a current basis, but for which 
     interest amounts are added to principal over time as 
     specified in the relevant offering materials and which 
     converts to a current pay bond on a future date.
       (6) Information agent.--The term ``Information Agent'' 
     means an information agent appointed in accordance with 
     subsection (l).
       (7) Insured bond.--The term ``Insured Bond'' means a bond 
     subject to a financial guarantee or similar insurance 
     contract, policy or surety issued by a monoline insurer.
       (8) Issuer.--The term ``Issuer'' means, as applicable, the 
     Territory Government Issuer or an Authorized Territorial 
     Instrumentality that has issued or guaranteed at least one 
     Bond that is Outstanding.
       (9) Modification.--The term ``Modification'' means any 
     modification, amendment, supplement or waiver affecting one 
     or more series of Bonds, including those effected by way of 
     exchange, repurchase, conversion, or substitution.
       (10) Outstanding.--The term ``Outstanding,'' in the context 
     of the principal amount of Bonds, shall be determined in 
     accordance with subsection (b).
       (11) Outstanding principal.--The term ``Outstanding 
     Principal'' means--
       (A) for a Bond that is not a Capital Appreciation Bond or a 
     Convertible Capital Appreciation Bond, the outstanding 
     principal amount of such Bond; and

[[Page 8423]]

       (B) for a Bond that is a Capital Appreciation Bond or a 
     Convertible Capital Appreciation Bond, the current accreted 
     value of such Capital Appreciation Bond or a Convertible 
     Capital Appreciation Bond, as applicable.
       (12) Pool.--The term ``Pool'' means a pool established in 
     accordance with subsection (d).
       (13) Qualifying modification.--The term ``Qualifying 
     Modification'' means a Modification proposed in accordance 
     with subsection (g).
       (14) Secured pool.--The term ``Secured Pool'' means a Pool 
     established in accordance with subsection (d) consisting only 
     of Bonds that are secured by a lien on property, provided 
     that the inclusion of a Bond Claim in such Pool shall not in 
     any way limit or prejudice the right of the Issuer, the 
     Administrative Supervisor, or any creditor to recharacterize 
     or challenge such Bond Claim, or any purported lien securing 
     such Bond Claim, in any other manner in any subsequent 
     proceeding in the event a proposed Qualifying Modification is 
     not consummated.
       (15) Territory government issuer.--The term ``Territory 
     Government Issuer'' means the Government of Puerto Rico or 
     such covered territory for which an Oversight Board has been 
     established pursuant to section 101.
       (b) Outstanding Bonds.--In determining whether holders of 
     the requisite principal amount of Outstanding Bonds have 
     voted in favor of, or consented to, a proposed Qualifying 
     Modification, a Bond will be deemed not to be outstanding, 
     and may not be counted in a vote or consent solicitation for 
     or against a proposed Qualifying Modification, if on the 
     record date for the proposed Qualifying Modification--
       (1) the Bond has previously been cancelled or delivered for 
     cancellation or is held for reissuance but has not been 
     reissued;
       (2) the Bond has previously been called for redemption in 
     accordance with its terms or previously become due and 
     payable at maturity or otherwise and the Issuer has 
     previously satisfied its obligation to make, or provide for, 
     all payments due in respect of the Bond in accordance with 
     its terms;
       (3) the Bond has been substituted with a security of 
     another series; or
       (4) the Bond is held by the Issuer or by an Authorized 
     Territorial Instrumentality of the Territory Government 
     Issuer or by a corporation, trust or other legal entity that 
     is controlled by the Issuer or an Authorized Territorial 
     Instrumentality of the Territory Government Issuer, as 
     applicable.

     For purposes of this subsection, a corporation, trust or 
     other legal entity is controlled by the Issuer or by an 
     Authorized Territorial Instrumentality of the Territory 
     Government Issuer if the Issuer or an Authorized Territorial 
     Instrumentality of the Territory Government Issuer, as 
     applicable, has the power, directly or indirectly, through 
     the ownership of voting securities or other ownership 
     interests, by contract or otherwise, to direct the management 
     of or elect or appoint a majority of the board of directors 
     or other persons performing similar functions in lieu of, or 
     in addition to, the board of directors of that legal entity.
       (c) Certification of Disenfranchised Bonds.--Prior to any 
     vote on, or consent solicitation for, a Qualifying 
     Modification, the Issuer shall deliver to the Calculation 
     Agent a certificate signed by an authorized representative of 
     the Issuer specifying any Bonds that are deemed not to be 
     Outstanding for the purpose of subsection (b) above.
       (d) Determination of Pools for Voting.--The Administrative 
     Supervisor, in consultation with the Issuer, shall establish 
     Pools in accordance with the following:
       (1) Not less than one Pool shall be established for each 
     Issuer.
       (2) A Pool that contains one or more Bonds that are secured 
     by a lien on property shall be a Secured Pool.
       (3) The Administrative Supervisor shall establish Pools 
     according to the following principles:
       (A) For each Issuer that has issued multiple Bonds that are 
     distinguished by specific provisions governing priority or 
     security arrangements, including Bonds that have been issued 
     as general obligations of the Territory Government Issuer to 
     which the Territory Government Issuer pledged the full or 
     good faith, credit, and taxing power of the Territory 
     Government Issuer, separate Pools shall be established 
     corresponding to the relative priority or security 
     arrangements of each holder of Bonds against each Issuer, as 
     applicable, provided, however, that the term ``priority'' as 
     used in this section shall not be understood to mean 
     differing payment or maturity dates.
       (B) For each Issuer that has issued senior and subordinated 
     Bonds, separate Pools shall be established for the senior and 
     subordinated Bonds corresponding to the relative priority or 
     security arrangements.
       (C) For each Issuer that has issued multiple Bonds, for at 
     least some of which a guarantee of repayment has been 
     provided by the Territory Government Issuer, separate Pools 
     shall be established for such guaranteed and non-guaranteed 
     Bonds.
       (D) Subject to the other requirements contained in this 
     section, for each Issuer that has issued multiple Bonds, for 
     at least some of which a dedicated revenue stream has been 
     pledged for repayment, separate Pools for such Issuer shall 
     be established as follows--
       (i) for each dedicated revenue stream that has been pledged 
     for repayment, not less than one Secured Pool for Bonds for 
     which such revenue stream has been pledged, and separate 
     Secured Pools shall be established for Bonds of different 
     priority; and
       (ii) not less than one Pool for all other Bonds issued by 
     the Issuer for which a dedicated revenue stream has not been 
     pledged for repayment.
       (E) The Administrative Supervisor shall not place into 
     separate Pools Bonds of the same Issuer that have identical 
     rights in security or priority.
       (4) Notwithstanding the preceding provisions of this 
     subsection, a preexisting voluntary agreement may classify 
     Insured Bonds and uninsured bonds in different Pools and 
     provide different treatment thereof so long as the 
     preexisting voluntary agreement has been agreed to by--
       (A) holders of a majority in amount of all uninsured bonds 
     outstanding in the modified Pool; and
       (B) holders (including insurers with power to vote) of a 
     majority in amount of all Insured Bonds.
       (e) Authorization of Territory Instrumentalities.--A 
     covered territorial instrumentality is an Authorized 
     Territorial Instrumentality if it has been specifically 
     authorized to be eligible to avail itself of the procedures 
     under this section by the Administrative Supervisor.
       (f) Information Delivery Requirement.--Before solicitation 
     of acceptance or rejection of a Modification under subsection 
     (h), the Issuer shall provide to the Calculation Agent, the 
     Information Agent, and the Administrative Supervisor, the 
     following information--
       (1) a description of the Issuer's economic and financial 
     circumstances which are, in the Issuer's opinion, relevant to 
     the request for the proposed Qualifying Modification, a 
     description of the Issuer's existing debts, a description of 
     the impact of the proposed Qualifying Modification on the 
     territory's or its territorial instrumentalities' public 
     debt;
       (2) if the Issuer is seeking Modifications affecting any 
     other Pools of Bonds of the Territory Government Issuer or 
     its Authorized Territorial Instrumentalities, a description 
     of such other Modifications;
       (3) if a Fiscal Plan with respect to such Issuer has been 
     certified, the applicable Fiscal Plan certified in accordance 
     with section 201; and
       (4) such other information as may be required under 
     applicable securities laws.
       (g) Qualifying Modification.--A Modification is a 
     Qualifying Modification if--
       (1) the Issuer proposing the Modification has consulted 
     with holders of Bonds in each Pool of such Issuer prior to 
     soliciting a vote on such Modification;
       (2) each exchanging, repurchasing, converting, or 
     substituting holder of Bonds of any series in a Pool affected 
     by that Modification is offered the same amount of 
     consideration per amount of principal, the same amount of 
     consideration per amount of interest accrued but unpaid and 
     the same amount of consideration per amount of past due 
     interest, respectively, as that offered to each other 
     exchanging, repurchasing, converting, or substituting holder 
     of Bonds of any series in a Pool affected by that 
     Modification (or, where a menu of instruments or other 
     consideration is offered, each exchanging, repurchasing, 
     converting, or substituting holder of Bonds of any series in 
     a Pool affected by that Modification is offered the same 
     amount of consideration per amount of principal, the same 
     amount of consideration per amount of interest accrued but 
     unpaid and the same amount of consideration per amount of 
     past due interest, respectively, as that offered to each 
     other exchanging, repurchasing, converting, or substituting 
     holder of Bonds of any series in a Pool affected by that 
     Modification electing the same option under such menu of 
     instruments);
       (3) the Modification is certified by the Administrative 
     Supervisor as being consistent with the requirements set 
     forth in section 104(i)(1) and is in the best interests of 
     the creditors and is feasible; or
       (4) notwithstanding paragraphs (1) through (3), the 
     Administrative Supervisor has issued a certification that--
       (A) the requirements set forth in section 104(i)(2) have 
     been satisfied; or
       (B) the Modification is consistent with a restructuring 
     support or similar agreement to be implemented pursuant to 
     the law of the covered territory executed by the Issuer prior 
     to the establishment of an Oversight Board for the relevant 
     territory.
       (h) Solicitation.--
       (1) Upon receipt of a certification from the Administrative 
     Supervisor under subsection (g), the Information Agent shall, 
     if practical and except as provided in paragraph (2), submit 
     to the holders of any Outstanding Bonds of the relevant 
     Issuer, including holders of the right to vote such 
     Outstanding Bonds, the information submitted by the relevant 
     Issuer under subsection (f)(1) in order to solicit the vote 
     of such holders to approve or reject the Qualifying 
     Modification.
       (2) If the Information Agent is unable to identify the 
     address of holders of any Outstanding Bonds of the relevant 
     Issuer, the Information Agent may solicit the vote or consent 
     of such holders by--
       (A) delivering the solicitation to the paying agent for any 
     such Issuer or Depository Trust Corporation if it serves as 
     the clearing system for any of the Issuer's Outstanding 
     Bonds; or
       (B) delivering or publishing the solicitation by whatever 
     additional means the Information Agent, after consultation 
     with the Issuer, deems necessary and appropriate in order to 
     make a reasonable effort to inform holders of any Outstanding 
     Bonds of the Issuer which may include, notice by mail, 
     publication in electronic media, publication on a website of 
     the Issuer, or publication in newspapers of national 
     circulation in the United States and in a newspaper of 
     general circulation in the territory.

[[Page 8424]]

       (i) Who May Propose a Modification.--For each Issuer, a 
     Modification may be proposed to the Administrative Supervisor 
     by the Issuer or by one or more holders of the right to vote 
     the Issuer's Outstanding Bonds. To the extent a Modification 
     proposed by one or more holders of the right to vote 
     Outstanding Bonds otherwise complies with the requirements of 
     this title, the Administrative Supervisor may accept such 
     Modification on behalf of the Issuer, in which case the 
     Administrative Supervisor will instruct the Issuer to provide 
     the information required in subsection (f).
       (j) Voting.--For each Issuer, any Qualifying Modification 
     may be made with the affirmative vote of the holders of the 
     right to vote at least two-thirds of the Outstanding 
     Principal amount of the Outstanding Bonds in each Pool that 
     have voted to approve or reject the Qualifying Modification, 
     provided that holders of the right to vote not less than a 
     majority of the aggregate Outstanding Principal amount of all 
     the Outstanding Bonds in each Pool have voted to approve the 
     Qualifying Modification. The holder of the right to vote the 
     Outstanding Bonds that are Insured Bonds shall be the 
     monoline insurer insuring such Insured Bond to the extent 
     such insurer is granted the right to vote Insured Bonds for 
     purposes of directing remedies or consenting to proposed 
     amendments or modifications as provided in the applicable 
     documents pursuant to which such Insured Bond was issued and 
     insured.
       (k) Calculation Agent.--For the purpose of calculating the 
     principal amount of the Bonds of any series eligible to 
     participate in such a vote or consent solicitation and 
     tabulating such votes or consents, the Territory Government 
     Issuer may appoint a Calculation Agent for each Pool 
     reasonably acceptable to the Administrative Supervisor.
       (l) Information Agent.--For the purpose of administering a 
     vote of holders of Bonds, including the holders of the right 
     to vote such Bonds, or seeking the consent of holder of 
     Bonds, including the holders of the right to vote such Bonds, 
     to a written action under this section, the Territory 
     Government Issuer may appoint an Information Agent for each 
     Pool reasonably acceptable to the Administrative Supervisor.
       (m) Binding Effect.--
       (1) A Qualifying Modification will be conclusive and 
     binding on all holders of Bonds whether or not they have 
     given such consent, and on all future holders of those Bonds 
     whether or not notation of such Qualifying Modification is 
     made upon the Bonds, if--
       (A) the holders of the right to vote the Outstanding Bonds 
     in every Pool of the Issuer pursuant to subsection (j) have 
     consented to or approved the Qualifying Modification;
       (B) the Administrative Supervisor certifies that--
       (i) the voting requirements of this section have been 
     satisfied;
       (ii) the Qualifying Modification complies with the 
     requirements set forth in section 104(i)(1); and
       (iii) except for such conditions that have been identified 
     in the Qualifying Modification as being non-waivable, any 
     conditions on the effectiveness of the Qualifying 
     Modification have been satisfied or, in the Administrative 
     Supervisor's sole discretion, satisfaction of such conditions 
     has been waived;
       (C) with respect to a Bond Claim that is secured by a lien 
     on property and with respect to which the holder of such Bond 
     Claim has rejected or not consented to the Qualifying 
     Modification, the holder of such Bond--
       (i) retains the lien securing such Bond Claims; or
       (ii) receives on account of such Bond Claim, through 
     deferred cash payments, substitute collateral, or otherwise, 
     at least the equivalent value of the lesser of the amount of 
     the Bond Claim or of the collateral securing such Bond Claim; 
     and
       (D) the district court for the territory or, for any 
     territory that does not have a district court, the United 
     States District Court for the District of Hawaii, has, after 
     reviewing an application submitted to it by the applicable 
     Issuer for an order approving the Qualifying Modification, 
     entered an order that the requirements of this section have 
     been satisfied.
       (2) Upon the entry of an order under paragraph (1)(D), the 
     conclusive and binding Qualifying Modification shall be valid 
     and binding on any person or entity asserting claims or other 
     rights, including a beneficial interest (directly or 
     indirectly, as principal, agent, counterpart, subrogee, 
     insurer or otherwise) in respect of Bonds subject to the 
     Qualifying Modification, any trustee, any collateral agent, 
     any indenture trustee, any fiscal agent, and any bank that 
     receives or holds funds related to such Bonds. All property 
     of an Issuer for which an order has been entered under 
     paragraph (1)(D) shall vest in the Issuer free and clear of 
     all claims in respect of any Bonds of any other Issuer. Such 
     Qualifying Modification will be full, final, complete, 
     binding, and conclusive as to the territorial government 
     Issuer, other territorial instrumentalities of the 
     territorial government Issuer, and any creditors of such 
     entities, and should not be subject to any collateral attack 
     or other challenge by any such entities in any court or other 
     forum. Other than as provided herein, the foregoing shall not 
     prejudice the rights and claims of any party that insured the 
     Bonds, including the right to assert claims under the Bonds 
     as modified following any payment under the insurance policy, 
     and no claim or right that may be asserted by any party in a 
     capacity other than holder of a Bond affected by the 
     Qualifying Modification shall be satisfied, released, 
     discharged, or enjoined by this provision.
       (n) Judicial Review.--
       (1) The district court for the territory or, for any 
     territory that does not have a district court, the United 
     States District Court for the District of Hawaii shall have 
     original and exclusive jurisdiction over civil actions 
     arising under this section.
       (2) Notwithstanding section 106(e), there shall be a cause 
     of action to challenge unlawful application of this section.
       (3) The district court shall nullify a Modification and any 
     effects on the rights of the holders of Bonds resulting from 
     such Modification if and only if the district court 
     determines that such Modification is manifestly inconsistent 
     with this section.

     SEC. 602. APPLICABLE LAW.

       In any judicial proceeding regarding this title, Federal, 
     State, or territorial laws of the United States, as 
     applicable, shall govern and be applied without regard or 
     reference to any law of any international or foreign 
     jurisdiction.

  TITLE VII--SENSE OF CONGRESS REGARDING PERMANENT, PRO-GROWTH FISCAL 
                                REFORMS

     SEC. 701. SENSE OF CONGRESS REGARDING PERMANENT, PRO-GROWTH 
                   FISCAL REFORMS.

       It is the sense of the Congress that any durable solution 
     for Puerto Rico's fiscal and economic crisis should include 
     permanent, pro-growth fiscal reforms that feature, among 
     other elements, a free flow of capital between possessions of 
     the United States and the rest of the United States.

  The Acting CHAIR. No amendment to that amendment in the nature of a 
substitute shall be in order except those printed in House Report 114-
610. Each such amendment may be offered only in the order printed in 
the report, by a Member designated in the report, shall be considered 
as read, shall be debatable for the time specified in the report 
equally divided and controlled by the proponent and an opponent, shall 
not be subject to amendment, and shall not be subject to a demand for 
division of the question.


             Amendment No. 1 Offered by Mr. Bishop of Utah

  The Acting CHAIR. It is now in order to consider amendment No. 1 
printed in House Report 114-610.
  Mr. BISHOP of Utah. Mr. Chairman, I have an amendment at the desk.
  The Acting CHAIR. The Clerk will designate the amendment.
  The text of the amendment is as follows:

       Page 3, line 14, strike ``If'' and insert ``(a) In 
     General.--Except as provided in subsection (b), if''.
       Page 3, after line 20, insert the following:
       (b) Uniformity.--If a court holds invalid any provision of 
     this Act or the application thereof on the ground that the 
     provision fails to treat similarly situated territories 
     uniformly, then the court shall, in granting a remedy, order 
     that the provision of this Act or the application thereof be 
     extended to any other similarly situated territory, provided 
     that the legislature of that territory adopts a resolution 
     signed by the territory's governor requesting the 
     establishment and organization of a Financial Oversight and 
     Management Board pursuant to section 101.
       Page 9, strike lines 24 and 25.
       Page 10 strike lines 1 through 7, and insert the following:
       (1) Puerto rico.--A Financial Oversight and Management 
     Board is hereby established for Puerto Rico.
       Page 10, line 8, strike ``(3)'' and insert ``(2)''.
       Page 12, line 22, strike ``must'' and insert ``shall''.
       Page 14, line 6, insert ``, non-overlapping'' after ``from 
     a separate''.
       Page 16, lines 15 through 16, strike ``September 30, 2016'' 
     and insert ``September 1, 2016''.
       Page 16, line 18, strike ``December 1, 2016'' and insert 
     ``September 15, 2016''.
       Page 19, line 4, strike ``subsection'' and insert ``Act''.
       Page 20, line 5, insert ``and any professionals the 
     Oversight Board determines necessary'' after ``voting 
     members''.
       Page 29, line 9, insert ``until an order approving the 
     Qualifying Modification has been entered pursuant to section 
     601(m)(1)(D) of this Act'' after ``such agreement''.
       Page 29, strike lines 10 through 18 and insert the 
     following:
       (3) Preexisting voluntary agreements.--Any voluntary 
     agreement that the territorial government or any territorial 
     instrumentality has executed before May 18, 2016, with 
     holders of a majority in amount of Bond Claims that are to be 
     affected by such agreement to restructure such Bond Claims 
     shall be deemed to be in conformance with the requirements of 
     this subsection.
       Page 32, line 11, strike ``the Government of Puerto Rico'' 
     and insert ``a covered territory''.
       Page 34, strike line 19 through page 35, line 3 and insert 
     the following:

[[Page 8425]]

       (b) Funding.--The Oversight Board shall use its powers with 
     respect to the Territory Budget of the covered territory to 
     ensure that sufficient funds are available to cover all 
     expenses of the Oversight Board.
       (1) Permanent funding.--Within 30 days after the date of 
     enactment of this Act, the territorial government shall 
     designate a dedicated funding source, not subject to 
     subsequent legislative appropriations, sufficient to support 
     the annual expenses of the Oversight Board as determined in 
     the Oversight Board's sole and exclusive discretion.
       (2)(A) Initial funding.--On the date of establishment of an 
     Oversight Board in accordance with section 101(b) and on the 
     5th day of each month thereafter, the Governor of the covered 
     territory shall transfer or cause to be transferred the 
     greater of $2,000,000 or such amount as shall be determined 
     by the Oversight Board pursuant to subsection (a) to a new 
     account established by the territorial government, which 
     shall be available to and subject to the exclusive control of 
     the Oversight Board, without any legislative appropriations 
     of the territorial government.
       (B) Termination.--The initial funding requirements under 
     subparagraph (A) shall terminate upon the territorial 
     government designating a dedicated funding source not subject 
     to subsequent legislative appropriations under paragraph (1).
       (3) Remission of excess funds.--If the Oversight Board 
     determines in its sole discretion that any funds transferred 
     under this subsection exceed the amounts required for the 
     Oversight Board's operations as established pursuant to 
     subsection (a), any such excess funds shall be periodically 
     remitted to the territorial government.
       Page 35, line 15, strike ``or on'' and insert ``, on''.
       Page 35, line 15, insert ``, or against'' after ``behalf 
     of''.
       Page 35, line 17 and 18, strike ``no conflict of interest 
     exists'' and insert ``the representation complies with the 
     applicable professional rules of conduct governing conflicts 
     of interests''.
       Page 60, line 7, insert ``(A)'' before ``During the 
     period''.
       Page 60, line 18, strike ``reversal'' and insert 
     ``rescission''.
       Page 60, line 19, insert at the end the following:
       (B) Upon appointment of the Oversight Board's full 
     membership, the Oversight Board may review, and in its sole 
     discretion, rescind, any law that--
       (i) was enacted during the period between, with respect to 
     Puerto Rico, May 4, 2016; or with respect to any other 
     territory, 45 days prior to the establishment of the 
     Oversight Board for such territory, and the date of 
     appointment of all members and the Chair of the Oversight 
     Board; and
       (ii) alters pre-existing priorities of creditors in a 
     manner outside the ordinary course of business or 
     inconsistent with the territory's constitution or the laws of 
     the territory as of, in the case of Puerto Rico, May 4, 2016, 
     or with respect to any other territory, 45 days prior to the 
     establishment of the Oversight Board for such territory;

     but such rescission shall only be to the extent that the law 
     alters such priorities.
       Page 73, strike line 22, and insert ``be excluded, and 
     that, for each excluded trust or other legal entity, the 
     court shall, upon the request of any participant or 
     beneficiary of such trust or entity, at any time after the 
     commencement of the case, order the appointment of a separate 
     committee of creditors pursuant to section 1102(a)(2) of 
     title 11, United States Code; and''.
       Page 75, line 2, insert at the end the following: ``The 
     term `trustee' as described in this paragraph does not mean 
     the U.S. Trustee, an official of the United States Trustee 
     Program, which is a component of the United States Department 
     of Justice.''.
       Page 75, line 8, insert ```Chapter 11,''' after ```Chapter 
     9'''.
       Page 76, line 22, insert ``but'' after ``for such 
     exercise,''.
       Page 76, line 23, strike ``, but''.
       Page 84, line 23, insert ``(1)'' before ``If the Oversight 
     Board''.
       Page 85, after line 2, insert the following:
       (2) With respect to paragraph (1), the Oversight Board may 
     consider, among other things--
       (A) the resources of the district court to adjudicate a 
     case or proceeding; and
       (B) the impact on witnesses who may be called in such a 
     case or proceeding.
       Page 88, line 7, strike ``Impaired Creditors'' and insert 
     ``Claims''.
       Page 88, line 14, insert ``claims, which claims are'' after 
     ``only one class of''.
       Page 88, line 21, insert ``and does not discriminate 
     unfairly'' after ``table''.
       Page 94, line 10, insert ``(29 U.S.C. 215(a)(3))'' after 
     ``section 15(a)(3)''.
       Page 111, line 1, strike ``180 days'' and insert ``one 
     year''.
       Page 115, line 24, insert ``, which should be analyzed,'' 
     after ``level of debt''.
       Page 116, lines 4 and 5, strike ``nor policies that would'' 
     and insert ``or policies that would not''.
       Page 116, line 8, strike ``States or local units of 
     government''.
       Page 121, lines 7 and 8, strike ``, or in the preceding 3 
     calendar years provided,''.
       Page 142, line 2, strike ``a preexisting voluntary 
     agreement'' and insert ``solely with respect to a preexisting 
     voluntary agreement as described in section 104(i)(3) of this 
     Act, such voluntary agreement''.
       Page 143, line 16, strike ``if--'' and insert ``if one of 
     the following processes has occurred:''.
       Page 143, line 17, strike ``the Issuer'' and insert 
     ``Consultation process.--(A) The Issuer''.
       Page 143, line 20, strike ``(2)'' and insert ``(B)''.
       Page 144, line 17, insert ``and'' after the semicolon.
       Page 144, line 18, strike ``(3)'' and insert ``(C)''.
       Page 144, line 21, strike ``; or'' and insert a period.
       Page 144, lines 22 through 23, strike ``(4) notwithstanding 
     paragraphs (1) through (3), the'' and insert the following:
       (2) Voluntary agreement process.--The
       Page 145, line 2, insert ``and section 601(g)(1)(B)'' after 
     ``104(i)(2)''.

  The Acting CHAIR. Pursuant to House Resolution 770, the gentleman 
from Utah (Mr. Bishop) and a Member opposed each will control 5 
minutes.
  The Chair recognizes the gentleman from Utah.
  Mr. BISHOP of Utah. Mr. Chairman, this is the proverbial manager's 
amendment. It does have four significant elements that I think people 
ought to be aware of in this particular amendment.
  Thanks to a lot of work from Mr. MacArthur and some others, we have 
an opt-in provision in this piece of legislation for the other 
territories. However, if a court finding removes the opt-in provision 
and finds it to be unconstitutional, it then does have a reverse 
severability clause that would reinstate the opt-in for other 
territories so there would not be a constitutional issue.
  We do have a funding mechanism in this bill to make sure that the 
oversight board is up and running properly as we begin. It also has the 
ability for the oversight board to give them the authority to review 
and rescind any laws passed by the territory between May 4 and the date 
of its full appointment of membership if those actions alter the 
priorities of repayment and move things around in a controversial way.
  Finally, and probably most important, the amendment also includes a 
moving up of the timetable for appointment to the board. This simply 
says the President will have the appointment of the board up and 
running by September 15 of this year, and no later than that.
  This, I think, has some other technical amendments that truly are 
technical, but those are four substantive amendments in the manager's 
amendment that help make this what we intend it to be and get us up and 
running very quickly.
  I yield back the balance of my time.
  The Acting CHAIR. The question is on the amendment offered by the 
gentleman from Utah (Mr. Bishop).
  The amendment was agreed to.


           Amendment No. 2 Offered by Mr. Graves of Missouri

  The Acting CHAIR. It is now in order to consider amendment No. 2 
printed in House Report 114-610.
  Mr. GRAVES of Missouri. Mr. Chairman, I have an amendment at the 
desk.
  The Acting CHAIR. The Clerk will designate the amendment.
  The text of the amendment is as follows:

       Page 61, line 4, strike ``or''.
       Page 61, line 7, strike the period and insert ``; or''.
       Page 61, after line 7, insert:
       (4) preserve and maintain federally funded mass 
     transportation assets.

  The Acting CHAIR. Pursuant to House Resolution 770, the gentleman 
from Missouri (Mr. Graves) and a Member opposed each will control 5 
minutes.
  The Chair recognizes the gentleman from Missouri.
  Mr. GRAVES of Missouri. Mr. Chairman, I rise today in support of my 
amendment which ensures federally funded public transportation systems 
are considered an essential service as Puerto Rico works to address its 
debt crisis.
  Mr. Chairman, public transportation services in Puerto Rico are 
provided by a fully automated rapid rail line known as Tren Urbano. The 
system serves 8.5 million customers each year, providing access to 
three universities, the main

[[Page 8426]]

medical center in Puerto Rico, and major financial centers in its 
capital.
  Construction of Tren Urbano was funded by the United States 
Government through a Federal Transit Administration grant. In fact, of 
the total $2.2 billion price tag, over $800 million came from Federal 
grants, and another $300 million came from a TIFIA loan. These are 
taxpayer investments we cannot let go to waste, and this amendment is 
simply a fiscally responsible way to make sure that that doesn't 
happen.
  Failure to maintain Puerto Rico's mass transit system would cause 
Tren Urbano to fall into disrepair. We have seen just how disruptive 
those problems can be right here in our Nation's Capital. As the 
chairman of the House Subcommittee on Highways and Transit, I recently 
held a hearing on the safety and reliability of the Metro system here 
in D.C. Repairs to the Metro have added to congestion problems in this 
city, and it has caused an untold amount in lost worker productivity. 
We do not want to see the same problems in Puerto Rico. We want to make 
sure that that doesn't happen. We don't want to see those same 
problems, especially given the economic situation they are facing.
  Over the last several years, the Government of Puerto Rico has 
struggled to pay for Tren Urbano's operations. At times, outstanding 
debt for operations has exceeded $20 million. Nevertheless, with the 
aid of FTA preventive maintenance grants, revenues from passenger 
fares, and funds from the Puerto Rican Highway and Transportation 
Authority, Tren Urbano has been able to continue serving the residents 
of Puerto Rico. It is critical we ensure Tren Urbano is treated as an 
essential service so that we can protect the hundreds of millions of 
taxpayer dollars that are already invested in the system.
  Mr. Chairman, this doesn't prioritize anything. It doesn't put 
anything at the top of the list. It just simply says that it is going 
to be a part of this process, so we do not lose that investment.
  Mr. CAPUANO. Will the gentleman yield?
  Mr. GRAVES of Missouri. I yield to the gentleman from Massachusetts.
  Mr. CAPUANO. Mr. Chairman, I thank the gentleman for yielding.
  I want to step up and basically add my name to this and my support 
and say it is a good amendment. It should pass.
  Mr. BISHOP of Utah. Will the gentleman yield?
  Mr. GRAVES of Missouri. I yield to the gentleman from Utah.
  Mr. BISHOP of Utah. Mr. Chairman, I also want to support this 
amendment. Everything is fine with me too.
  Mr. GRAVES of Missouri. Mr. Chairman, I yield back the balance of my 
time.
  The Acting CHAIR. The question is on the amendment offered by the 
gentleman from Missouri (Mr. Graves).
  The amendment was agreed to.


                  Amendment No. 3 Offered by Mr. Jolly

  The Acting CHAIR. It is now in order to consider amendment No. 3 
printed in House Report 114-610.
  Mr. JOLLY. Mr. Chairman, I have an amendment at the desk.
  The Acting CHAIR. The Clerk will designate the amendment.
  The text of the amendment is as follows:

       Page 114, line 11, insert ``, reduce child poverty,'' 
     before ``and attract''.

  The Acting CHAIR. Pursuant to House Resolution 770, the gentleman 
from Florida (Mr. Jolly) and a Member opposed each will control 5 
minutes.
  The Chair recognizes the gentleman from Florida.
  Mr. JOLLY. Mr. Chairman, section 409 of this very important 
legislation creates a congressional task force on economic growth in 
Puerto Rico. The intent of the task force is to study barriers to 
economic growth, report back to Congress on changes in Federal law that 
would spur long-term, sustainable economic growth, job creation, and 
also attract investment in Puerto Rico. However, in my opinion, the 
section could be improved by also studying the impact and recommended 
changes on child poverty on the island of Puerto Rico.
  Nearly 60 percent of children under 18 live below the poverty level 
in Puerto Rico, and roughly 80 percent live in high poverty areas. That 
is in comparison to only 11 percent who live in high poverty areas here 
in the continental United States.
  This very simple amendment would add to the requirements of the 
congressional task force that they report back on recommended changes 
to address and reduce child poverty in the territory.
  This amendment has been endorsed by an organization of roughly 600 
national and local religious bodies, including the U.S. Conference of 
Catholic Bishops, the United Methodist Church, the Presbyterian Church 
U.S.A., Catholic Charities, the Union for Reform Judaism.
  Additionally, on Tuesday of this week, San Juan Archbishop Roberto 
Gonzalez Nieves called on Congress to specifically address child 
poverty in this bill.
  Much of the debate has centered around balancing the interests and 
needs of bondholders and lenders with those of pensioners. I would ask 
that this body also consider the impact on the least among us. We are 
all called to serve each other.
  This is an opportunity for this body to reflect not just the vision 
of our Founders, but the calling of our Creator in doing so. These 
children are American citizens. Their plight deserves our explicit 
attention.
  I urge my colleagues to support this amendment.
  Mr. Chairman, I reserve the balance of my time.
  Mr. GRIJALVA. Mr. Chairman, I ask unanimous consent to claim the time 
in opposition to this amendment, although I am not opposed to the 
amendment.
  The Acting CHAIR. Is there objection to the request of the gentleman 
from Arizona?
  There was no objection.
  The Acting CHAIR. The gentleman from Arizona is recognized for 5 
minutes.
  Mr. GRIJALVA. Mr. Chairman, I yield 2 minutes to the gentleman from 
Puerto Rico (Mr. Pierluisi), the commissioner from Puerto Rico.
  Mr. PIERLUISI. Mr. Chairman, I thank Congressman Grijalva.
  I rise to support this thoughtful amendment and to thank its authors, 
Congressman Jolly and Congressman Curbelo, both from Florida.
  Florida is home to over 1 million individuals of Puerto Rican birth 
or descent, and will soon pass New York as the State with the largest 
Puerto Rican population. Many of the Puerto Rican families in Florida 
are recent arrivals, having relocated from Puerto Rico to the Sunshine 
State in search of the equality and economic opportunity that they lack 
on the island.

                              {time}  1715

  I also want to thank the organization Jubilee USA, which has been a 
constructive player in the debate over PROMESA.
  This amendment requires the Congressional Task Force on Economic 
Growth in Puerto Rico, created by section 409 of the bill, to report on 
recommended changes to Federal policy that would reduce child poverty 
in Puerto Rico.
  I do not want to prejudge the work of the task force, so I will 
simply say this: poverty in Puerto Rico, including child poverty, is 
far higher than in any State in the Nation, and it has been far higher 
for as long as statistics have been available. This demonstrates that 
the problem is structural in nature. It is rooted in the unequal 
treatment that Puerto Rico receives under key Federal antipoverty 
programs, which is only permissible because Puerto Rico is a territory 
rather than a State. To reduce poverty, we must end unequal treatment, 
and to end unequal treatment, Puerto Rico must discard its territory 
status in favor of statehood or nationhood.
  Mr. JOLLY. Mr. Chair, I reserve the balance of my time.
  Mr. GRIJALVA. Mr. Chair, I yield 1 minute to the gentleman from New 
York (Mr. Serrano).
  Mr. SERRANO. Mr. Chair, I was not planning to speak, but when I heard

[[Page 8427]]

Bishop Gonzalez' name mentioned, I had to say something because he was 
my parish priest at two different parishes in the Bronx. I know of his 
work, and if he wants this discussed, then it is something I should 
rise to and support. He always cared about child poverty in the Bronx 
when he was my parish priest. Now, as I tell him he is a big shot in 
Puerto Rico, he is still doing the right thing by God's work.
  Mr. JOLLY. Mr. Chair, I reserve the balance of my time.
  Mr. GRIJALVA. Mr. Chair, in closing, let me thank and commend the 
gentleman from Florida for this very good amendment. I think it 
dovetails with the rest of the legislation very well as the gentleman 
addresses some of the indices in Puerto Rico that require attention--
the challenges around poverty that the Puerto Rican people are facing. 
It is not often in this Chamber that we talk about poverty. The 
gentleman is to be commended, and I support the amendment.
  Mr. Chair, I yield back the balance of my time.
  Mr. JOLLY. Mr. Chair, in closing, I urge my colleagues to support 
this very important amendment.
  Do the right thing for the very least among us--those children on the 
island who are facing significant challenges of poverty--so that we, as 
a body, might respond better to the right policies that address their 
very real needs. I urge the passage of this amendment.
  Mr. Chair, I yield back the balance of my time.
  The Acting CHAIR. The question is on the amendment offered by the 
gentleman from Florida (Mr. Jolly).
  The amendment was agreed to.


                  Amendment No. 4 Offered by Mr. Byrne

  The Acting CHAIR. It is now in order to consider amendment No. 4 
printed in House Report 114-610.
  Mr. BYRNE. Mr. Chair, I have an amendment at the desk.
  The Acting CHAIR. The Clerk will designate the amendment.
  The text of the amendment is as follows:

       Page 115, line 20, strike ``The'' and insert ``Not later 
     than 18 months after the date of the enactment of this Act, 
     the''.

  The Acting CHAIR. Pursuant to House Resolution 770, the gentleman 
from Alabama (Mr. Byrne) and a Member opposed each will control 5 
minutes.
  The Chair recognizes the gentleman from Alabama.
  Mr. BYRNE. Mr. Chair, I thank Chairman Bishop for his leadership on 
this issue. This has not been an easy task, but he has provided great 
leadership, and I appreciate it.
  I also thank Mr. Graves of Louisiana and Mr. Polis for their 
amendment at the committee level, which requires a report from the 
Government Accountability Office that outlines how Puerto Rico reached 
this point of fiscal insolvency.
  My amendment is very straightforward. It would simply set a deadline 
for the GAO to submit this report within 18 months of the enactment of 
this bill. Mr. Graves and Mr. Polis are cosponsors of my amendment, and 
they agree that setting a deadline is important.
  We must figure out how Puerto Rico got to this point in order to 
avoid another territory's finding itself in a similar position at some 
point down the road. I believe having this report and receiving it in a 
timely manner will, hopefully, go a long way towards preventing a 
similar situation in the future. This amendment is about 
accountability, and I urge its adoption.
  Mr. Chair, I yield back the balance of my time.
  The Acting CHAIR. The question is on the amendment offered by the 
gentleman from Alabama (Mr. Byrne).
  The amendment was agreed to.


                  Amendment No. 5 Offered by Mr. Byrne

  The Acting CHAIR. It is now in order to consider amendment No. 5 
printed in House Report 114-610.
  Mr. BYRNE. Mr. Chair, I have an amendment at the desk.
  The Acting CHAIR. The Clerk will designate the amendment.
  The text of the amendment is as follows:

       Page 116, after line 10, insert the following:

     SEC. 411. REPORT ON TERRITORIAL DEBT.

       (a) Report Required.--Not later than one year after the 
     date of the enactment of this Act, and thereafter not less 
     than once every two years, the Comptroller General of the 
     United States shall submit to Congress a report on the public 
     debt of each territory, including--
       (1) the historical levels of each territory's public debt, 
     current amount and composition of each territory's public 
     debt, and future projections of each territory's public debt;
       (2) the historical levels of each territory's revenue, 
     current amount and composition of each territory's revenue, 
     and future projections of each territory's revenue;
       (3) the drivers and composition of each territory's public 
     debt;
       (4) the effect of Federal laws, mandates, rules, and 
     regulations on each territory's public debt; and
       (5) the ability of each territory to repay it's public 
     debt.
       (b) Materials.--The government of each territory shall make 
     available to the Comptroller General of the United States all 
     materials necessary to carry out this section.

  The Acting CHAIR. Pursuant to House Resolution 770, the gentleman 
from Alabama (Mr. Byrne) and a Member opposed each will control 5 
minutes.
  The Chair recognizes the gentleman from Alabama.
  Mr. BYRNE. Mr. Chair, as we have heard over and over again today, 
this Congress has plenary authority over our territories. Over the 
course of the last century, this body has rightly delegated this power 
to provide for home rule for our territories. However, it is abundantly 
clear that this delegation of power has resulted in no oversight by the 
Federal Government over the debts that our territories are running up.
  In this particular case, out of the blue, we have been told by the 
United States Treasury that it is our constitutional responsibility to 
do something to save a territory from years of its own fiscal 
irresponsibility. For years, the entire Federal Government was, 
essentially, asleep at the wheel as one of our territories ran up huge, 
unsustainable debts until the day arose when the territory could no 
longer pay.
  Mr. Chair, I have absolutely no interest in interfering with the home 
rule of our territories. However, delegated authority can be abused. If 
we have a constitutional responsibility to intervene to prevent 
territorial insolvency, we certainly should exercise at least minimal 
oversight into the large debts that some of our territories are running 
up.
  My amendment is simple. It requires a biennial report to Congress on 
the debt of each territory, the drivers of each territory's debt, the 
effect of Federal policy on each territory's debt, and the ability of 
each territory to repay its debt. This will help us provide that 
minimal oversight.
  Unfortunately, Mr. Chair, the very agency that is coming to Congress 
and asking us to help Puerto Rico--the United States Treasury--has 
refused to provide this report to Congress, claiming it lacks 
resources. Let's be clear. The Department of the Treasury was 
appropriated $11.9 billion for this fiscal year, and they claim a lack 
of resources to put together a simple report on five tiny territories. 
That is astonishing. It is also irresponsible.
  In response to the Department of the Treasury, I offered a 
compromise. I would take one Treasury report on territorial debt if the 
Treasury would simply agree to monitor and advise us of what is going 
on with these territorial governments and what we should do to prevent 
insolvency.
  According to the Treasury, this was even worse. It would represent an 
unprecedented expansion into the finances and solvency of a U.S. 
subsovereign. Apparently, this administration doesn't like the 
Territories Clause of the Constitution unless it is being used at the 
very last minute to save Puerto Rico.
  I don't blame Puerto Rico for this. I blame the United States 
Treasury for this. If the United States Treasury is unwilling to do its 
job, I have changed the text of my amendment to require the GAO to put 
together this biennial report, and I look forward to seeing its 
results.
  Last night, Mr. Chair, in the Rules Committee meeting, we heard 
testimony from the representatives of two other territories, who told 
us that they are concerned that their territories are sliding in the 
same direction as Puerto

[[Page 8428]]

Rico's while the Treasury Department sleeps. Since the Treasury 
Department won't take responsibility and do its job, we are going to do 
our job through the GAO.
  I hope my colleagues will join me in doing something to fix this 
problem before another crisis is upon us. Perhaps, then, we can even 
get the Treasury and the rest of the Federal Government to wake up. If 
they don't, I will have a lot less sympathy the next time they come 
asking for our help.
  Mr. Chair, I reserve the balance of my time.
  Mr. GRIJALVA. Mr. Chair, I rise in opposition to this amendment.
  The Acting CHAIR. The gentleman from Arizona is recognized for 5 
minutes.
  Mr. GRIJALVA. Mr. Chair, this amendment requires the GAO to submit 
reports every 2 years to the Congress about the public debt and about 
the ability to pay that debt of all U.S. territories. While the debt 
crisis in Puerto Rico is, indeed, serious and real, there is no 
indication that any other territory faces a similar crisis.
  The base bill already includes reporting requirements. Requiring more 
reporting to cover the territories is unwarranted as well as being a 
waste of the GAO's limited time to provide more important reports to 
Congress.
  A number of States and localities on the mainland face much more 
precarious budget situations than do the other territories. We don't 
need any more focus on U.S. territories when there is no reason to 
believe such onerous reporting is really required or justified.
  Mr. Chair, I reserve the balance of my time.
  Mr. BYRNE. Mr. Chair, I yield 2 minutes to the gentleman from Utah 
(Mr. Bishop).
  Mr. BISHOP of Utah. Mr. Chair, there is an old line from the play 
``1776,'' when Stephen Hopkins says:

       Mr. Chair, I have never seen, heard, or smelled an issue so 
     dangerous it couldn't be talked about. Hell, yes. I am for 
     debating anything.

  This is one of those situations in which you have never seen, heard, 
or smelled anything that shouldn't be studied. The information could be 
vital, and it could be helpful. For that, I endorse and support this 
amendment.
  Mr. GRIJALVA. Mr. Chair, I reserve the balance of my time.
  Mr. BYRNE. Mr. Chair, I listened to the gentleman's comments, and I 
have to tell you, if there is enough in this bill for the reporting, 
why did the Treasury not say that to us? They didn't say that to us 
because they know there needs to be a report done. They just don't want 
to take the responsibility for doing it.
  I think this amendment is definitely necessary for us to make sure we 
are doing our job in exercising our constitutional responsibility.
  I reserve the balance of my time.
  Mr. GRIJALVA. Mr. Chair, I reserve the balance of my time.
  Mr. BYRNE. Mr. Chair, I didn't know anything about this, and the vast 
majority of the Members didn't know anything about this problem before 
it was thrust upon us over the last several weeks.
  The irresponsibility of the Treasury Department in not giving this 
information to us months ago when they knew it was happening or when 
they should have known it was happening underscores the need for this. 
I am putting it on the GAO in this particular amendment, but in the 
years to come, we need to expect the Treasury to do its job, because it 
has failed to do so in this circumstance.
  I ask the House to adopt my amendment.
  Mr. Chair, I yield back the balance of my time.
  Mr. GRIJALVA. Mr. Chair, a recent report from the U.S. Public 
Interest Research Group Education Fund rated all 50 States on whether 
they made transparent budget and spending information available to the 
public. My own State of Arizona received a grade of a B, so we have 
some work to do there. The State of Alabama, however, received the 
grade of a D, placing it fourth from the bottom of all States.
  From that, it seems clear, if our goal is budget and spending 
transparency, perhaps our focus should be on our States on the mainland 
and not on the territories, because that seems to be where there is a 
verifiable problem.
  This amendment is unwarranted, and it does not need to be included in 
the legislation.
  Mr. Chair, I yield back the balance of my time.
  The Acting CHAIR. The question is on the amendment offered by the 
gentleman from Alabama (Mr. Byrne).
  The amendment was agreed to.


                  Amendment No. 6 Offered by Mr. Duffy

  The Acting CHAIR. It is now in order to consider amendment No. 6 
printed in House Report 114-610.
  Mr. DUFFY. Mr. Chair, I have an amendment at the desk.
  The Acting CHAIR. The Clerk will designate the amendment.
  The text of the amendment is as follows:

       Page 116, after line 10, insert the following:

     SEC. 411. EXPANSION OF HUBZONES IN PUERTO RICO.

       (a)  In General.--
       (1) Section 3(p)(4)(A) of the Small Business Act (15 U.S.C. 
     632(p)(4)(A)) is amended to read as follows:
       ``(A) Qualified census tract.--
       ``(i) In general.--The term `qualified census tract' has 
     the meaning given that term in section 42(d)(5)(B)(ii) of the 
     Internal Revenue Code of 1986.
       ``(ii) Exception.--For any metropolitan statistical area in 
     the Commonwealth of Puerto Rico, the term `qualified census 
     tract' has the meaning given that term in section 
     42(d)(5)(B)(ii) of the Internal Revenue Code of 1986 as 
     applied without regard to subclause (II) of such section, 
     except that this clause shall only apply--

       ``(I) 10 years after the date that the Administrator 
     implements this clause, or
       ``(II) the date on which the Financial Oversight and 
     Management Board for the Commonwealth of Puerto Rico created 
     by the Puerto Rico Oversight, Management, and Economic 
     Stability Act ceases to exist,

     whichever event occurs first.''.
       (2) Regulations.--The Administrator of the Small Business 
     Administration shall issue regulations to implement the 
     amendment made by paragraph (1) not later than 90 days after 
     the date of the enactment of this Act.
       (b) Improving Oversight.--
       (1) Guidance.--Not later than 270 days after the date of 
     the enactment of this Act, the Administrator of the Small 
     Business Administration shall develop and implement criteria 
     and guidance on using a risk-based approach to requesting and 
     verifying information from entities applying to be designated 
     or recertified as qualified HUBZone small business concerns 
     (as defined in section 3(p)(5) of the Small Business Act (15 
     U.S.C. 632(p)(5))).
       (2) Assessment.--Not later 1 year after the date on which 
     the criteria and guidance described in paragraph (1) is 
     implemented, the Comptroller General of the United States 
     shall begin an assessment of such criteria and guidance. Not 
     later than 6 months after beginning such an assessment, the 
     Comptroller General shall submit a report to the Committee on 
     Small Business and Entrepreneurship of the Senate and the 
     Committee on Small Business of the House of Representatives 
     that includes--
       (A) an assessment of the criteria and guidance issued by 
     the Administrator of the Small Business Administration in 
     accordance with paragraph (1);
       (B) an assessment of the implementation of the criteria and 
     guidance issued by issued by the Administrator of the Small 
     Business Administration in accordance with paragraph (1);
       (C) an assessment as to whether these measures have 
     successfully ensured that only qualified HUBZone small 
     business concerns are participating in the HUBZone program 
     under section 31 of the Small Business Act (15 U.S.C. 657a);
       (D) an assessment as to whether the reforms made by the 
     criteria and guidance implemented under paragraph (1) have 
     resulted in job creation in the Commonwealth of Puerto Rico; 
     and
       (E) recommendations on how to improve controls in the 
     HUBZone program.

  The Acting CHAIR. Pursuant to House Resolution 770, the gentleman 
from Wisconsin (Mr. Duffy) and a Member opposed each will control 5 
minutes.
  The Chair recognizes the gentleman from Wisconsin.
  Mr. DUFFY. Mr. Chair, the Puerto Rico unemployment rate is double the 
national average. Nearly one in every two residents lives below the 
poverty line. Economic growth is in the negative. We have heard about 
that all day today. Now, PROMESA will stop the bleeding, but there 
isn't an easy solution to jump-start the economy. We have a down 
payment in a commission, but this is, I think, a real step in the

[[Page 8429]]

direction of trying to kick-start economic growth.
  My amendment, with my colleague from Puerto Rico (Mr. Pierluisi), 
will provide modest assistance to Puerto Rico by removing an impediment 
to the Small Business Administration's HUBZone program that limits the 
number of businesses on the island that are eligible for the program.
  This idea was brought to me by my friend Jaime Perello, the speaker 
of the Legislative Assembly of Puerto Rico, and it is a good one. What 
does it do? The HUBZone program is a small business, Federal 
contracting assistance program, whose primary objective is job creation 
and increasing capital investment in distressed communities.

                              {time}  1730

  Now, there is a 20 percent cap. So that 20 percent cap for this 
program might not affect Minneapolis or Chicago or Milwaukee because 
you don't even have 20 percent of the communities that are distressed.
  However, in Puerto Rico you have far more than 20 percent of the 
communities that are distressed. You have 80 percent of them that are 
distressed. So by removing this cap, you have a larger part of the 
community that qualifies to access this program.
  This is, I think, a very good solution and downpayment on economic 
growth and investment in Puerto Rico. Not only that, but there have 
been some noted problems with the program. GAO has made some 
recommendations. We have solidified those recommendations in this bill 
not just for Puerto Rico, but for the Nation as a whole to make sure 
there are better checks and balances in the HUBZone program.
  I reserve the balance of my time.
  Mr. CHABOT. Mr. Chair, I claim time in opposition.
  The Acting CHAIR. The gentleman from Ohio is recognized for 5 
minutes.
  Mr. CHABOT. Mr. Chairman, I rise reluctantly in opposition to the 
amendment offered by the gentleman from Wisconsin (Mr. Duffy).
  The House Small Business Committee that I happen to chair has 
jurisdiction over the SBA's HUBZone program. Our committee has not yet 
had the opportunity to have oversight hearings on the program during 
this session, and I don't believe it would be prudent to adopt this 
amendment until the committee has had the opportunity to perform its 
due diligence.
  In discussions with interested parties during the development of this 
legislation, I suggested language that would require the GAO to issue a 
report on Small Business Administration programs in Puerto Rico, 
including contract activities relating to HUBZone small businesses 
concerns. That language is contained in the underlying text. That 
report, coupled with committee oversight work, I believe, will ensure 
that what Congress ultimately does will, in fact, help Puerto Rico's 
small businesses.
  I reserve the balance of my time.
  Mr. DUFFY. Mr. Chair, I yield 2\1/2\ minutes to the gentleman from 
Puerto Rico (Mr. Pierluisi).
  Mr. PIERLUISI. Mr. Chairman, I want to begin by thanking Congressman 
Duffy for his outstanding work on this bill and on this particular 
amendment. I also want to thank Congressman Don Young, a steadfast 
champion for fair treatment for Puerto Rico who is also a cosponsor of 
this amendment.
  The primary purpose of this amendment is to increase small business 
activity and promote job creation in Puerto Rico.
  The HUBZone program supports economically distressed communities 
throughout the Nation. If the poverty rate or median income in a census 
tract meets a certain threshold, it is designated as a qualified census 
tract. Small businesses located in a qualified census tract can compete 
for Federal contracts with preference, assuming they meet all other 
criteria established by law.
  However, there is a statutory cap which prevents the combined 
population of the qualified census tracts within a metropolitan 
statistical area from exceeding 20 percent of the total population of 
that area. Although the cap applies nationwide, it has a uniquely 
negative impact in Puerto Rico. Small firms located in over 60 
municipalities in Puerto Rico cannot take advantage of the HUBZone 
program solely because of the cap. No other U.S. State or territory 
comes anywhere close to being as adversely affected by the cap as 
Puerto Rico.
  To promote economic development in Puerto Rico, which is absolutely 
essential if the territory is going to prosper, our amendment would 
remove the cap for Puerto Rico for 10 years or until the independent 
oversight board established by the legislation terminates, whichever 
occurs first. Based on the best available statistics, this amendment 
ensures that small firms located in over 80 percent of the census 
tracts in Puerto Rico may be eligible to compete with preference for 
Federal contracts, which should create additional employment 
opportunities on the island. The amendment will only extend the HUBZone 
programs to those census tracts in Puerto Rico that would have 
qualified for the program in the absence of the cap. So it does not 
constitute an unwarranted expansion of the HUBZone program.
  I urge my colleagues to vote ``yes'' on this amendment.
  Mr. DUFFY. Mr. Chair, who has the right to close?
  The Acting CHAIR. The gentleman from Ohio has the right to close.
  Mr. DUFFY. Mr. Chair, I appreciate the comments by Chairman Chabot, 
and I would just note that I know his committee hasn't had oversight 
hearings on this issue. The GAO has done extensive studies, and the 
Small Business Administration has not implemented those 
recommendations. I think the most salient recommendations made by the 
GAO have been included in this bill and go a long way to improving the 
program, but if we are going to fix Puerto Rico, debt restructuring is 
imperative.
  This oversight board is key, but we need economic growth. And I think 
this is the right downpayment to help kick-start some economic growth 
on the island, that the people in Puerto Rico know that we understand 
that. And we are taking one small step today to show that we are going 
to help them get from that 20 percent cap to allow 80 percent of the 
island to access this HUBZone program because we care about growth, we 
care about opportunity, and we care about jobs on the island.
  Mr. Chair, I yield back the balance of my time.
  Mr. CHABOT. Mr. Chair, I yield back the balance of my time.
  The Acting CHAIR. The question is on the amendment offered by the 
gentleman from Wisconsin (Mr. Duffy).
  The amendment was agreed to.


                 Amendment No. 7 Offered by Mr. Serrano

  The Acting CHAIR. It is now in order to consider amendment No. 7 
printed in House Report 114-610.
  Mr. SERRANO. Mr. Chairman, I have an amendment at the desk.
  The Acting CHAIR. The Clerk will designate the amendment.
  The text of the amendment is as follows:

       At the end of title IV, insert the following:

     SEC. 411. DETERMINATION ON DEBT.

       Nothing in this Act shall be interpreted to restrict--
       (1) the ability of the Puerto Rico Commission for the 
     Comprehensive Audit of the Public Credit to file its reports; 
     or
       (2) the review and consideration of the Puerto Rico 
     Commission's findings by Puerto Rico's government or an 
     Oversight Board for Puerto Rico established under section 
     101.

  The Acting CHAIR. Pursuant to House Resolution 770, the gentleman 
from New York (Mr. Serrano) and a Member opposed each will control 5 
minutes.
  The Chair recognizes the gentleman from New York.
  Mr. SERRANO. Mr. Chairman, this amendment offered by Ms. Velazquez 
and myself would help clarify that this legislation would not impact 
the work being done by the Puerto Rico Commission for the Comprehensive 
Audit of the Public Credit.
  This entity, set up by Puerto Rico's Government, is in the process of 
examining the massive debt that has been accrued by the territory. In a 
preliminary report, the commission recently found that a small portion 
of the debt

[[Page 8430]]

may have been illegally issued by the government of Puerto Rico, and 
they need to further examine the issue and its implications.
  This amendment simply preserves the ability of this commission to 
continue their work and for either the government or the oversight 
board to review and consider any findings that the commission might 
have. The work being done by the commission could significantly assist 
both the oversight board and the Puerto Rican Government as the island 
tries to get back on its feet.
  I reserve the balance of my time.
  Mr. BISHOP of Utah. Mr. Chair, I claim time in opposition, even 
though I am not opposed to this particular amendment.
  The Acting CHAIR. Without objection, the gentleman is recognized for 
5 minutes.
  There was no objection.
  Mr. BISHOP of Utah. Mr. Chair, I want to make it very clear that this 
particular amendment does not override the authority of the oversight 
board. But because of that, I do support the amendment, and I urge its 
adoption.
  I yield back the balance of my time.
  Mr. SERRANO. Mr. Chair, I yield 3 minutes to the gentlewoman from New 
York (Ms. Velazquez), my sister from Yabucoa, Puerto Rico.
  Ms. VELAZQUEZ. Mr. Chair, I represent New York's Seventh 
Congressional District.
  I rise in strong support of the Serrano-Velazquez amendment. 
Throughout the course of this entire saga, it has become increasingly 
clear that Puerto Rico's debt is not fully understood. The island has 
issued 18 different classes of debt--from general obligation to COFINA, 
to GDB, to utility bonds. Various local and State laws are involved, 
and the result is a web of confusion.
  To address this, the Puerto Rico Commission for the Comprehensive 
Audit of the Public Credit was created to examine all of the island's 
debt, something that is very much needed. The audit will not only 
inform the people of Puerto Rico, but also, in many ways, will assist 
the oversight board in carrying out its mission. Analyzing and 
assessing all of the island's $70 billion in debt is long overdue.
  Recently, the commission released a preliminary report finding that a 
small, yet significant, amount of the debt may have violated the 
island's constitution. Such a finding is meaningful and could have 
ramifications for this legislation's implementation.
  Our amendment ensures that the underlying bill will not prevent the 
commission from finishing its important work while also allowing the 
local government and the oversight board to consider these findings if 
they so chose.
  In summary, this amendment would allow for much-needed sunlight to be 
shown on the island's financial situation.
  I urge Members to support this amendment.
  Mr. SERRANO. Mr. Chair, I urge everyone to vote for the amendment.
  I yield back the balance of my time.
  The Acting CHAIR. The question is on the amendment offered by the 
gentleman from New York (Mr. Serrano).
  The amendment was agreed to.


                 Amendment No. 8 Offered by Mrs. Torres

  The Acting CHAIR. It is now in order to consider amendment No. 8 
printed in House Report 114-610.
  Mrs. TORRES. Mr. Chairman, I have an amendment at the desk.
  The Acting CHAIR. The Clerk will designate the amendment.
  The text of the amendment is as follows:

       Strike section 403 (and redesignate succeeding sections and 
     conform the table of contents accordingly).

  The Acting CHAIR. Pursuant to House Resolution 770, the gentlewoman 
from California (Mrs. Torres) and a Member opposed each will control 5 
minutes.
  The Chair recognizes the gentlewoman from California.
  Mrs. TORRES. Mr. Chairman, I yield myself such time as I may consume.
  Mr. Chairman, the bill, as it is currently written, allows the 
minimum wage for workers 25 years and under to be lowered to abysmal 
$4.25 for 4 years for as long as the oversight board is in place. It 
also fails to specify whether this reduction is limited to one 4-year 
period or if the request can be made over and over again, essentially 
keeping the lower wage indefinitely.
  My amendment would strip this provision from the bill. In today's 
dollars, American workers haven't had a minimum wage this low since the 
1940s. The young men and women of Puerto Rico are American citizens, 
and they don't deserve to be treated like second-class workers.
  These aren't high school students with summer jobs. They are young 
people setting off on their careers, many of them struggling to pay off 
student loan debt and become self-sufficient. Lowering the wage only 
adds insult to injury and sends the wrong statement about whether we 
value Puerto Ricans as equal Americans.
  The island is already experiencing a mass exodus of young people. 
Lowering wages will only make more young people want to leave, having a 
detrimental impact on Puerto Rico's current and future workforce, its 
tax base, and its ability to pay off its debt, ultimately digging them 
into a deeper hole.
  If we want to help Puerto Rico overcome this current crisis, we need 
to make sure the island is a place where young people can see a future 
for themselves, start a family, and work to grow a business, not a 
place that devalues their work and their contributions.
  The minimum wage provision in this bill is bad for these young 
workers and is bad for Puerto Rico.
  I urge my colleagues to support my amendment.
  I reserve the balance of my time.
  Mr. ROE of Tennessee. Mr. Speaker, I claim time in opposition.
  The Acting CHAIR. The gentleman is recognized for 5 minutes.
  Mr. ROE of Tennessee. Mr. Chair, I respectfully rise in opposition to 
the amendment by my colleague from California because this is exactly 
the kind of thinking that led Puerto Rico into the fiscal situation in 
which they now find themselves.
  As we all know, one thing that would help address Puerto Rico's 
fiscal crisis is a stronger, more vibrant local economy. That is why 
this legislation includes a number of provisions aimed at helping local 
businesses expand and hire new workers. This amendment would strike an 
entire provision from the bill, a provision that is pro-growth and 
aimed at revitalizing local businesses and the Puerto Rican economy as 
a whole.
  Section 403 is a provision that will make it easier for young workers 
to find jobs and start their careers. The legislation gives the 
Governor of Puerto Rico the authority, subject to the approval of the 
oversight board, to adjust the minimum wage for new workers under the 
age of 25. Current law already allows employers to offer what is known 
as a youth opportunity wage for up to 90 days. This legislation simply 
extends the time period in Puerto Rico to 4 years, an idea that was 
first recommended in 2012 by the Federal Reserve Bank of New York, 
which noted then that younger workers were ``in danger of becoming 
disconnected from the labor market.''
  This recommended change will support economic growth and provide more 
job opportunities for the local workforce, particularly younger workers 
and workers with fewer skills. These are commonsense policies that will 
help address Puerto Rico's fiscal crisis by supporting a stronger, more 
prosperous local economy.
  For these reasons, I urge my colleagues to oppose this amendment and 
support the underlying legislation.
  I yield back the balance of my time.
  Mrs. TORRES. Mr. Chairman, I yield 1 minute to the gentleman from 
Florida (Mr. Grayson).

                              {time}  1745

  Mr. GRAYSON. Mr. Chairman, we are talking about a minimum wage of 
$4.25 an hour. That is less than $700 per month. Tell me how anybody 
can survive anywhere on the island of Puerto Rico on less than $700 a 
month. It simply isn't possible. The cost of living in San Juan is no 
lower than it is in Orlando, or much of the mainland for that matter.

[[Page 8431]]

  I don't know where you can even find a one-bedroom apartment for $700 
a month that would be worth living in. I don't know how you can pay for 
lunch and dinner and breakfast for $700 a month. I don't know how you 
can find health coverage for $700 a month. I don't know how you can 
find transportation to get to that job for $700 a month. I just don't 
get it. Any one of these things would be enough to break the budget and 
put you into bankruptcy if you are only making $700 a month, and that 
is before you even have to pay taxes.
  What we are doing is we are taking a Spanish-speaking population, 3.5 
million of them, and we are condemning them to low wages to the point 
where 45-year-old men will lose their jobs to 20-year-old sons because 
the 20-year-old sons are forced to work for only $4.25.
  The Acting CHAIR. The time of the gentleman has expired.
  Mrs. TORRES. Mr. Chairman, I yield an additional 30 seconds to the 
gentleman.
  Mr. GRAYSON. This is the lesson that we are teaching those young men 
and women who we are supposedly trying to help. The lesson is this: hop 
on an airplane from San Juan to my district in Orlando for $168, and 
you can get a 70 percent increase in your wages because that is what 
the difference is already under current law between what you are 
talking about, a $4.25 hourly wage and $7.25 that you can earn 
legally--it is actually more than that under State law--in Orlando. 
That is not teaching people how to work. It is teaching people to 
disrespect work.
  Mrs. TORRES. Mr. Chairman, how much time do I have remaining?
  The Acting CHAIR. The gentlewoman has 1\1/2\ minutes remaining.
  Mrs. TORRES. Mr. Chairman, someone living in Puerto Rico needs to 
make $9.25 an hour to afford a one-bedroom apartment. If the wage is 
lowered to $4.25, not even two earners could afford to live there.
  Mr. Chairman, there is no question that Puerto Rico will need to make 
sacrifices, but it can't do so on the backs of its young workforce, 
American citizens. This provision does not fix Puerto Rico's problems, 
and in the long run, it makes them worse.
  I urge my colleagues to support my amendment so that Puerto Rico's 
recovery doesn't come at the expense of young, hardworking Americans.
  Mr. Chairman, I yield back the balance of my time.
  The Acting CHAIR. The question is on the amendment offered by the 
gentlewoman from California (Mrs. Torres).
  The question was taken; and the Acting Chair announced that the noes 
appeared to have it.


                             Recorded Vote

  Mrs. TORRES. Mr. Chairman, I demand a recorded vote.
  A recorded vote was ordered.
  The vote was taken by electronic device, and there were--ayes 196, 
noes 225, not voting 13, as follows:

                             [Roll No. 287]

                               AYES--196

     Adams
     Aguilar
     Ashford
     Bass
     Beatty
     Becerra
     Bera
     Beyer
     Bishop (GA)
     Blumenauer
     Bonamici
     Bost
     Boyle, Brendan F.
     Brady (PA)
     Brown (FL)
     Brownley (CA)
     Bustos
     Butterfield
     Capps
     Capuano
     Cardenas
     Carney
     Carson (IN)
     Cartwright
     Castor (FL)
     Castro (TX)
     Chu, Judy
     Cicilline
     Clark (MA)
     Clarke (NY)
     Cleaver
     Clyburn
     Cohen
     Connolly
     Conyers
     Cooper
     Costa
     Costello (PA)
     Courtney
     Crowley
     Cuellar
     Cummings
     Davis (CA)
     Davis, Danny
     DeFazio
     DeGette
     Delaney
     DeLauro
     DelBene
     DeSaulnier
     Deutch
     Dingell
     Doggett
     Dold
     Donovan
     Doyle, Michael F.
     Duckworth
     Edwards
     Ellison
     Engel
     Eshoo
     Esty
     Fattah
     Fitzpatrick
     Foster
     Frankel (FL)
     Fudge
     Gabbard
     Gallego
     Garamendi
     Gibson
     Graham
     Grayson
     Green, Al
     Green, Gene
     Grijalva
     Gutierrez
     Hahn
     Hanna
     Hastings
     Heck (WA)
     Higgins
     Himes
     Honda
     Hoyer
     Huffman
     Israel
     Jackson Lee
     Jeffries
     Johnson (GA)
     Johnson, E. B.
     Jolly
     Joyce
     Kaptur
     Katko
     Keating
     Kelly (IL)
     Kennedy
     Kildee
     Kilmer
     Kind
     Kirkpatrick
     Kuster
     Langevin
     Larsen (WA)
     Larson (CT)
     Lawrence
     Lee
     Levin
     Lewis
     Lipinski
     LoBiondo
     Loebsack
     Lofgren
     Lowenthal
     Lowey
     Lujan Grisham (NM)
     Lujan, Ben Ray (NM)
     Lynch
     Maloney, Carolyn
     Maloney, Sean
     Matsui
     McCollum
     McDermott
     McGovern
     McNerney
     Meehan
     Meeks
     Meng
     Moore
     Moulton
     Murphy (FL)
     Nadler
     Napolitano
     Neal
     Nolan
     Norcross
     O'Rourke
     Pallone
     Pascrell
     Pelosi
     Perlmutter
     Peters
     Peterson
     Pingree
     Pocan
     Polis
     Price (NC)
     Quigley
     Rangel
     Reed
     Rice (NY)
     Richmond
     Ros-Lehtinen
     Roybal-Allard
     Ruiz
     Ruppersberger
     Rush
     Ryan (OH)
     Sanchez, Linda T.
     Sanchez, Loretta
     Sarbanes
     Schakowsky
     Schiff
     Schrader
     Scott (VA)
     Scott, David
     Serrano
     Sewell (AL)
     Sherman
     Sinema
     Slaughter
     Smith (NJ)
     Smith (WA)
     Speier
     Swalwell (CA)
     Takano
     Thompson (CA)
     Thompson (MS)
     Titus
     Tonko
     Torres
     Tsongas
     Van Hollen
     Vargas
     Veasey
     Vela
     Velazquez
     Visclosky
     Walz
     Wasserman Schultz
     Waters, Maxine
     Watson Coleman
     Welch
     Wilson (FL)
     Yarmuth

                               NOES--225

     Abraham
     Aderholt
     Allen
     Amash
     Amodei
     Babin
     Barr
     Barton
     Benishek
     Bilirakis
     Bishop (MI)
     Bishop (UT)
     Black
     Blackburn
     Blum
     Boustany
     Brady (TX)
     Brat
     Bridenstine
     Brooks (AL)
     Brooks (IN)
     Buchanan
     Buck
     Bucshon
     Burgess
     Byrne
     Calvert
     Carter (GA)
     Carter (TX)
     Chabot
     Chaffetz
     Clawson (FL)
     Coffman
     Cole
     Collins (GA)
     Collins (NY)
     Comstock
     Conaway
     Cook
     Cramer
     Crawford
     Crenshaw
     Culberson
     Curbelo (FL)
     Davidson
     Davis, Rodney
     Denham
     Dent
     DeSantis
     DesJarlais
     Diaz-Balart
     Duffy
     Duncan (SC)
     Duncan (TN)
     Ellmers (NC)
     Emmer (MN)
     Farenthold
     Fleischmann
     Fleming
     Flores
     Forbes
     Fortenberry
     Foxx
     Frelinghuysen
     Garrett
     Gibbs
     Gohmert
     Goodlatte
     Gosar
     Gowdy
     Granger
     Graves (GA)
     Graves (LA)
     Graves (MO)
     Griffith
     Grothman
     Guinta
     Guthrie
     Harper
     Harris
     Hartzler
     Heck (NV)
     Hensarling
     Hice, Jody B.
     Hill
     Holding
     Hudson
     Huelskamp
     Huizenga (MI)
     Hultgren
     Hunter
     Hurd (TX)
     Hurt (VA)
     Issa
     Jenkins (KS)
     Jenkins (WV)
     Johnson (OH)
     Johnson, Sam
     Jones
     Jordan
     Kelly (MS)
     Kelly (PA)
     King (IA)
     King (NY)
     Kinzinger (IL)
     Kline
     Knight
     Labrador
     LaHood
     LaMalfa
     Lamborn
     Lance
     Latta
     Long
     Loudermilk
     Love
     Lucas
     Lummis
     MacArthur
     Marchant
     Marino
     Massie
     McCarthy
     McCaul
     McClintock
     McHenry
     McKinley
     McMorris Rodgers
     McSally
     Meadows
     Messer
     Mica
     Miller (FL)
     Miller (MI)
     Moolenaar
     Mooney (WV)
     Mullin
     Mulvaney
     Murphy (PA)
     Neugebauer
     Newhouse
     Noem
     Nugent
     Nunes
     Olson
     Palazzo
     Palmer
     Paulsen
     Pearce
     Perry
     Pittenger
     Pitts
     Poe (TX)
     Poliquin
     Pompeo
     Posey
     Price, Tom
     Ratcliffe
     Reichert
     Renacci
     Ribble
     Rice (SC)
     Rigell
     Roby
     Roe (TN)
     Rogers (AL)
     Rogers (KY)
     Rohrabacher
     Rokita
     Rooney (FL)
     Roskam
     Ross
     Rothfus
     Rouzer
     Royce
     Russell
     Salmon
     Sanford
     Scalise
     Schweikert
     Scott, Austin
     Sensenbrenner
     Sessions
     Shimkus
     Shuster
     Simpson
     Smith (MO)
     Smith (NE)
     Smith (TX)
     Stefanik
     Stewart
     Stivers
     Stutzman
     Thompson (PA)
     Thornberry
     Tiberi
     Tipton
     Trott
     Turner
     Upton
     Valadao
     Wagner
     Walberg
     Walden
     Walker
     Walorski
     Walters, Mimi
     Weber (TX)
     Webster (FL)
     Wenstrup
     Westerman
     Westmoreland
     Whitfield
     Williams
     Wilson (SC)
     Wittman
     Womack
     Woodall
     Yoder
     Yoho
     Young (AK)
     Young (IA)
     Young (IN)
     Zeldin
     Zinke

                             NOT VOTING--13

     Barletta
     Clay
     Farr
     Fincher
     Franks (AZ)
     Hardy
     Herrera Beutler
     Hinojosa
     Lieu, Ted
     Luetkemeyer
     Payne
     Sires
     Takai

                              {time}  1811

  Messrs. AUSTIN SCOTT of Georgia, NUGENT, and Ms. GRANGER changed 
their vote from ``aye'' to ``no.''
  Mr. NOLAN changed his vote from ``no'' to ``aye.''
  So the amendment was rejected.
  The result of the vote was announced as above recorded.
  The Acting CHAIR. The question is on the amendment in the nature of 
the substitute, as amended.
  The amendment was agreed to.
  The Acting CHAIR. Under the rule, the Committee rises.
  Accordingly, the Committee rose; and the Speaker pro tempore (Mr. 
Dold) having assumed the chair, Mr. Collins of Georgia, Acting Chair of 
the Committee of the Whole House on the state of the Union, reported 
that that Committee, having had under consideration the bill (H.R. 
5278) to establish an

[[Page 8432]]

Oversight Board to assist the Government of Puerto Rico, including 
instrumentalities, in managing its public finances, and for other 
purposes, and, pursuant to House Resolution 770, he reported the bill 
back to the House with an amendment adopted in the Committee of the 
Whole.
  The SPEAKER pro tempore. Under the rule, the previous question is 
ordered.
  Is a separate vote demanded on any amendment to the amendment 
reported from the Committee of the Whole? If not, the question is on 
adoption of the amendment in the nature of a substitute, as amended.
  The amendment was agreed to.
  The SPEAKER pro tempore. The question is on the engrossment and third 
reading of the bill.
  The bill was ordered to be engrossed and read a third time, and was 
read the third time.
  The SPEAKER pro tempore. The question is on the passage of the bill.
  The question was taken; and the Speaker pro tempore announced that 
the ayes appeared to have it.


                             Recorded Vote

  Mr. BISHOP of Utah. Mr. Speaker, I demand a recorded vote.
  A recorded vote was ordered.
  The SPEAKER pro tempore. Pursuant to clause 8 of rule XX, this 5-
minute vote on passage will be followed by a 5-minute vote on agreeing 
to the Speaker's approval of the Journal, if ordered.
  The vote was taken by electronic device, and there were--ayes 297, 
noes 127, not voting 11, as follows:

                             [Roll No. 288]

                               AYES--297

     Adams
     Aguilar
     Amodei
     Barton
     Bass
     Beatty
     Benishek
     Bera
     Beyer
     Bishop (GA)
     Bishop (MI)
     Bishop (UT)
     Blumenauer
     Bonamici
     Bost
     Brady (TX)
     Brooks (IN)
     Brown (FL)
     Brownley (CA)
     Buchanan
     Bucshon
     Bustos
     Butterfield
     Byrne
     Calvert
     Capps
     Capuano
     Cardenas
     Carney
     Carson (IN)
     Carter (GA)
     Cartwright
     Castor (FL)
     Castro (TX)
     Chabot
     Chaffetz
     Chu, Judy
     Cicilline
     Clark (MA)
     Clarke (NY)
     Clay
     Cleaver
     Clyburn
     Coffman
     Cohen
     Cole
     Collins (GA)
     Collins (NY)
     Comstock
     Conaway
     Connolly
     Conyers
     Cooper
     Costa
     Costello (PA)
     Courtney
     Cramer
     Crenshaw
     Crowley
     Cuellar
     Culberson
     Cummings
     Curbelo (FL)
     Davis (CA)
     DeFazio
     DeGette
     Delaney
     DeLauro
     DelBene
     Denham
     Dent
     DeSaulnier
     Deutch
     Diaz-Balart
     Dingell
     Doggett
     Dold
     Donovan
     Doyle, Michael F.
     Duckworth
     Duffy
     Duncan (TN)
     Edwards
     Ellison
     Engel
     Eshoo
     Esty
     Fitzpatrick
     Fortenberry
     Foster
     Foxx
     Frankel (FL)
     Frelinghuysen
     Gabbard
     Gallego
     Garamendi
     Garrett
     Gibbs
     Graham
     Granger
     Graves (GA)
     Graves (LA)
     Graves (MO)
     Grayson
     Green, Al
     Green, Gene
     Griffith
     Grijalva
     Grothman
     Guthrie
     Hahn
     Hanna
     Harper
     Harris
     Heck (WA)
     Hensarling
     Higgins
     Hill
     Himes
     Honda
     Hoyer
     Huffman
     Huizenga (MI)
     Hunter
     Hurd (TX)
     Hurt (VA)
     Israel
     Jackson Lee
     Jeffries
     Jenkins (KS)
     Johnson (GA)
     Johnson (OH)
     Johnson, E. B.
     Jolly
     Kaptur
     Katko
     Keating
     Kelly (IL)
     Kennedy
     Kildee
     Kilmer
     Kind
     King (NY)
     Kinzinger (IL)
     Kirkpatrick
     Kline
     Kuster
     Labrador
     LaHood
     LaMalfa
     Langevin
     Larsen (WA)
     Larson (CT)
     Latta
     Lawrence
     Lee
     Levin
     Lewis
     Lipinski
     Loebsack
     Lofgren
     Loudermilk
     Love
     Lowenthal
     Lowey
     Lucas
     Lujan Grisham (NM)
     Lujan, Ben Ray (NM)
     Lummis
     MacArthur
     Maloney, Carolyn
     Maloney, Sean
     Marchant
     Matsui
     McCarthy
     McCaul
     McCollum
     McDermott
     McGovern
     McHenry
     McKinley
     McNerney
     McSally
     Meeks
     Meng
     Moolenaar
     Moore
     Moulton
     Murphy (FL)
     Murphy (PA)
     Nadler
     Napolitano
     Neal
     Noem
     Nugent
     Nunes
     O'Rourke
     Pallone
     Pascrell
     Paulsen
     Pelosi
     Perlmutter
     Peters
     Pingree
     Pittenger
     Pitts
     Pocan
     Polis
     Posey
     Price (NC)
     Price, Tom
     Quigley
     Rangel
     Reichert
     Ribble
     Rice (NY)
     Rice (SC)
     Roby
     Roe (TN)
     Rogers (KY)
     Rokita
     Ros-Lehtinen
     Roskam
     Ross
     Rothfus
     Roybal-Allard
     Royce
     Ruiz
     Ruppersberger
     Russell
     Ryan (WI)
     Salmon
     Sanchez, Linda T.
     Sanchez, Loretta
     Sarbanes
     Scalise
     Schiff
     Schrader
     Schweikert
     Scott (VA)
     Scott, Austin
     Scott, David
     Sensenbrenner
     Serrano
     Sessions
     Sewell (AL)
     Sherman
     Shimkus
     Simpson
     Sinema
     Slaughter
     Smith (NE)
     Smith (NJ)
     Smith (WA)
     Stefanik
     Stewart
     Stivers
     Stutzman
     Swalwell (CA)
     Takano
     Thompson (CA)
     Thompson (MS)
     Thompson (PA)
     Thornberry
     Tipton
     Titus
     Tonko
     Trott
     Tsongas
     Turner
     Upton
     Valadao
     Van Hollen
     Veasey
     Velazquez
     Visclosky
     Wagner
     Walden
     Walker
     Walorski
     Walters, Mimi
     Watson Coleman
     Webster (FL)
     Welch
     Wenstrup
     Westerman
     Whitfield
     Williams
     Wilson (FL)
     Wilson (SC)
     Womack
     Woodall
     Yarmuth
     Young (AK)
     Young (IA)
     Young (IN)
     Zinke

                               NOES--127

     Abraham
     Aderholt
     Allen
     Amash
     Ashford
     Babin
     Barr
     Becerra
     Bilirakis
     Black
     Blackburn
     Blum
     Boustany
     Boyle, Brendan F.
     Brady (PA)
     Brat
     Bridenstine
     Brooks (AL)
     Buck
     Burgess
     Carter (TX)
     Clawson (FL)
     Cook
     Crawford
     Davidson
     Davis, Danny
     Davis, Rodney
     DeSantis
     DesJarlais
     Duncan (SC)
     Ellmers (NC)
     Emmer (MN)
     Farenthold
     Fattah
     Fleischmann
     Fleming
     Flores
     Forbes
     Franks (AZ)
     Fudge
     Gibson
     Gohmert
     Goodlatte
     Gosar
     Gowdy
     Guinta
     Gutierrez
     Hartzler
     Hastings
     Heck (NV)
     Hice, Jody B.
     Holding
     Hudson
     Huelskamp
     Hultgren
     Issa
     Jenkins (WV)
     Johnson, Sam
     Jones
     Jordan
     Joyce
     Kelly (MS)
     Kelly (PA)
     King (IA)
     Knight
     Lamborn
     Lance
     LoBiondo
     Long
     Lynch
     Marino
     Massie
     McClintock
     McMorris Rodgers
     Meadows
     Meehan
     Messer
     Mica
     Miller (FL)
     Miller (MI)
     Mooney (WV)
     Mullin
     Mulvaney
     Neugebauer
     Newhouse
     Nolan
     Norcross
     Olson
     Palazzo
     Palmer
     Pearce
     Perry
     Peterson
     Poe (TX)
     Poliquin
     Pompeo
     Ratcliffe
     Reed
     Renacci
     Richmond
     Rigell
     Rogers (AL)
     Rohrabacher
     Rooney (FL)
     Rouzer
     Rush
     Ryan (OH)
     Sanford
     Schakowsky
     Shuster
     Smith (MO)
     Smith (TX)
     Speier
     Tiberi
     Torres
     Vargas
     Vela
     Walberg
     Walz
     Wasserman Schultz
     Waters, Maxine
     Weber (TX)
     Westmoreland
     Wittman
     Yoder
     Yoho
     Zeldin

                             NOT VOTING--11

     Barletta
     Farr
     Fincher
     Hardy
     Herrera Beutler
     Hinojosa
     Lieu, Ted
     Luetkemeyer
     Payne
     Sires
     Takai


                Announcement by the Speaker Pro Tempore

  The SPEAKER pro tempore (during the vote). There are 2 minutes 
remaining.

                              {time}  1820

  Mr. ASHFORD changed his vote from ``aye'' to ``no.''
  So the bill was passed.
  The result of the vote was announced as above recorded.
  A motion to reconsider was laid on the table.


                          PERSONAL EXPLANATION

  Mr. HARDY. Mr. Speaker, on rollcall No. 283--I would have voted 
``yes.'' Rollcall No. 284--I would have voted ``yes.'' Rollcall No. 
285--I would have voted ``yes.'' Rollcall No. 286--I would have voted 
``yes.'' Rollcall No. 287--I would have voted ``no.'' Rollcall No. 
288--I would have voted ``no.''

                          ____________________