Government Furloughs Expected As Bond Deadline Nears

Bloomberg

Michelle Kaske

Representative Rafael Hernandez, chairman of the House Treasury Committee.

Time is running out for Puerto Rico. The island’s government needs to
start unpaid furloughs of its workers to make a July payment on its junk-
rated bonds, the chairman of the House’s Treasury Committee said. The
Caribbean territory of 3.5 million people faces a $630  million payment
on its general-obligation bonds on July 1, according to Sergio Marxuach,
public-policy director at the Center for a New Economy in San Juan. To
make that payment, the government will need to start furloughing public
workers because the island’s constitution stipulates that revenue must first
be used to repay general-obligation debt, Representative Rafael “Tatito”
Hernandez said in an interview...[CONTINUE READING]