In Washington, legislative staff members were close Friday to completing a newly revised bill that would give extraordinary powers to Puerto Rico to wipe away debt under close supervision from the federal government.
Aides in the Natural Resource Committee of the House, working during their spring recess, are grappling with constitutional issues that are sensitive raised by this rescue package, even after San Juan lawmakers on Wednesday suddenly authorized a debt moratorium across the board for the Caribbean island.
The lawmaker in Puerto Rico said they had been force to take action because the U.S. Congress was taking far too long.
The Puerto Rico Government Development Bank has a payment of more than $422 million that is due May 1 and just $562 million in cash is available.
The new law enacted by the Puerto Rican lawmakers would allow the bank to indefinitely delay payment lawfully or at least as far as the island is concerned.
Puerto Rico also owes larger debt payments totaling over $2 billion that are due July 1.
The draft bill from the House still has certain provisions that creditor groups have fought and others have said more refinements are still likely.
The committee will take testimony regarding the rescue package Wednesday and its aides said the committee hoped a finished bill could be in the House by Thursday.
This package calls for the financial affairs of Puerto Rico to fall under the federal oversight board supervision and shed the debt in a federal court proceeding similar to bankruptcy after it meets certain requirements.
In Puerto Rico, officials objected last week to what they considered colonialist overtones from the oversight board that would have members that vote who were all selected by the U.S. President.
Drafters scaled some of the more intrusive powers back in the bill. They preserved the authority of the board to ensure that that the government of Puerto Rico adheres to a fiscal plan that is agreed upon.
The board also would be kept until the island regained the ability to sell debt.