Puerto Rico News Digest For July 24, 2017

JARDINES DE COUNTRY KILL

Carolina neighborhood reports murder for 2nd weekend in a row

A man believed to be in his early 20s, who is so far unidentified, was shot to death at around 4:30 on Sunday morning in the Jardines de Country Club neighborhood of Carolina. The victim parked his car on 30th Street, between a basketball court and baseball field in the suburban neighborhood, and was apparently shot at several times as he sat in the vehicle. It is unknown whether he was pursued there before being killed. After shooting, the perpetrators presumably drove away in their own vehicle, while the victim left his bullet-riddled car and stumbled for a few feet before falling to the ground, where he died. A 911 call alerted police to the sound of gunfire, and they found the lifeless body soon afterward. This is the second murder reported in Jardines de Country Club inside of a week, and was one of eight violent deaths registered over the weekend across Puerto Rico.

TREASURY NET INCOME UP 1.7% FOR LAST FISCAL YEAR

From The San Juan Daily Star:

"Puerto Rico Treasury Secretary Raúl Maldonado Gautier reported that the net income to the General Fund from the newly concluded fiscal year 2016-17 (July-June) amounted to $9.334 billion, which represents $159.6 million, or 1.7 percent  more than the previous fiscal year 2015-16..."

ROSSELLO SIGNS PATIENTS' RIGHTS LAW 

From Caribbean Business:

"...Puerto Rico Gov. Ricardo Rosselló on Sunday enacted Senate Bill 27, giving patients more say before health insurers and providing greater power to the Patients Advocate Office (OPP by its Spanish initials) when defending those who are  not covered by the government’s medical plan, Mi Salud..."

MORE PR DOCTORS GOING BANKRUPT 

From News Is My Business:

"During the first six months of the year, 17 medical doctors filed for bankruptcy protection, reporting more than $23.5 million in combined debt to the court, a report by research firm Boletín de Puerto Rico confirmed..."

ROSSELLO TRIES TO PUT PR IN CONGRESSIONAL AGENDA

From The Washington Examiner:

"Puerto Rico is throwing a wrench into the mainland's politics. The Caribbean island's government held a referendum on June 11 to gauge public support in what was the territory's fifth-ever plebiscite on statehood, and the vast majority  of voters said yes..."

If Puerto Rico Thinks Bankruptcy is a Better Solution, They Have a Rude Awakening Coming!

   Commentary

   Richard Lawless

One should look no further than the Puerto Rico Electric Power Authority’s (PREPA) pending bankruptcy.

All credible financial analysts agree that PREPA only needs slightly more than a 10% reduction in debt service to continue paying its bills and operating as expected.  Over a three-year period, the utility negotiated with their bond holders for a 15% reduction in debt.  This consensual agreement gave the utility almost 50% more than it needed to get back on track. 

If the bankruptcy judges execute the hearings without personal or political bias, PREPA will get only what it needs to operate safely.  That number should reflect about a 10% reduction in debt, far less than was offered to the utility in their consensual negotiations with their bond holders.

For PREPA to receive a more favorable outcome in court they will have to shape an argument based on the following factors:

1.     PREPA has allegedly been over charging its customers every year for high quality crude oil while paying and taking delivery of sludge oil.  The difference in cost is hundreds of millions of dollars each year. That money is unaccounted for.   (Business wire 4-16-16, RICO Lawsuit)

2.     PREPA must pay unusually high accounting fees to KPMG to produce misleading financial statements each year. 

(KPMG lead auditor, Puerto Rico Senate Hearing 6-24-15)

3.     PREPA must pay unusually high bond rating fees each year to secure misleading bond ratings for their new bond offerings.  

(Puerto Rico Monitor 4-5-16, FINRA Settlements, on-going SEC Investigations)

4.     PREPA must pay unusually high sales fees to the major Wall Street Banks for them to knowingly market troubled bonds as safe investments.

(Reuters 6-28-17)

5.     PREPA budgets hundreds of millions of dollars each year for equipment maintenance and the money disappears while the repairs are rarely done. 

(SEC Whistleblower Financial Audit 1-18-16)

6.     The Puerto Rico Fiscal Control Board although mandated through legislation to approve consensual agreements with Puerto Rico’s Creditors, the Board has elected to ignore the legislation costing PREPA many millions in future litigation.

(Puerto Rico Fiscal Control Board 6-27-17)

7.     PREPA has numerous law suits, FBI and SEC investigations going on now, costing PREPA tens of millions in legal and consulting expenses.

(AlixPartners $28 million, etc.…)

8.     PREPA has massive unfunded pension obligations, although the pension contributions are budgeted every year they rarely contribute what was promised.

The PREPA attorneys and accountants will have to shape an argument that if they are to maintain their current level of mismanagement and malfeasance, more money must be taken from the innocent bondholders.

In an honest legal system, PREPA is unlikely to prevail.

Richard Lawless is a former senior banker who has specialized in evaluating and granting debt for over 25 years. He has a Master’s Degree in Finance from the University of San Diego and Bachelor’s Degree from Pepperdine University. He sits on several Corporate Boards and actively writes for several finance publications.

Puerto Rico News Digest For June 29, 2017

DRUG DEALER KILLED IN BROAD DAYLIGHT

Police have identified a man gunned down yesterday morning in a Loíza alley as 39-year-old Jose R "Tatín" Quiñones Ayala, who was allegedly responsible for drug distribution in the local area. Ayala was walking down Melilla alley near 10:40 AM when two males approached him in a small gray car, stepped out of the vehicle and opened fire, leaving him for dead.

FIRST PR BANKRUPTCY MEDIATION DATE SET

From Caribbean Business:

"During the first half of Wednesday’s omnibus hearing over Puerto Rico’s bankruptcy cases, a July 12 date was announced for the first mediation session between creditors and the commonwealth..."

NORMANDIE HOTEL NEEDS $20 MILLION IN REPAIRS

From News Is My Business:

"The iconic Normandie Hotel, located at the entrance of the San Juan islet, needs an investment of some  $20 million to be brought back to its former glory, Tourism Co. Executive Director José Izquierdo said during confirmation hearings on Tuesday..."

LEGAL AID FOR LOW INCOME CITIZENS TO BECOME LAW

From The San Juan Daily Star:

"House Speaker Carlos “Johnny” Méndez Núñez recently has filed legislation to provide greater access to legal services for low income citizens, particularly in civil cases, by developing the Fund for Access to Justice and thereby creating greater access to financial resources..."

GOVERNOR: TRUMP WOULDN'T BLOCK STATEHOOD

From The Washington Examiner:

"Puerto Rican Gov. Ricardo Rossello says he disagrees with Rep. Luis Gutierrez, D-Ill., who said President Trump would block the U.S. territory from becoming a state because of its Latino population..."

Puerto Rico News Digest For September 6, 2016

HIGH WINDS KILL MAN IN GUAYANILLA

From Caribbean Business:

"Authorities say heavy winds associated with a tropical wave moving through the
Caribbean region have killed a man in the island’s southwest region. Police said
Monday that winds ripped off a tree branch that hit 31-year-old Alvin Torres as
he cleaned a property in the coastal town of Guayanilla. Forecasters said the tro-
pical wave south of Puerto Rico was generating winds of up to 40 miles per hour
(mph)...The National Hurricane Center (NHC) said Monday that shower and thu-
nderstorm activity associated with the wave had been decreasing. However, “stro-
ng winds, possibly to tropical storm force, could still be occurring in association
with this system” over Puerto Rico and Hispaniola Monday and Tuesday..."

NATL GUARD LANGUAGE CENTER OPEN THROUGH 2017

From The San Juan Daily Star:

"Resident Commissioner Pedro Pierluisi announced last week that the effort he
has led since 2014 to prevent the closure of the English Language Center opera-
ted by the Puerto Rico National Guard (PRNG) at Ft. Allen in Juana Díaz "appe-
ars to be on a successful path.” The English Language Center was scheduled to
be closed starting in fiscal year (FY) 2016, which ended June 30, but Pierluisi’s
efforts resulted in the Language Center continuing to operate..."

PR DEMANDS EPA CLEAN UP TOXIC LANDFILLS

From Washington Examiner:

"Puerto Ricans, disgusted with the Environmental Protection Agency's "willful
dereliction" of its oversight of the island's toxic landfills, are demanding that the
head of the agency close them, saying they have lost faith in an EPA deputy in
charge of the territory. The citizens' advocacy group Puerto Rico Limpio, which
means Puerto Rico Clean, is clamoring in a letter for EPA Administrator Gina Mc
Carthy to enforce federal laws by closing the "toxic landfills." Their Sept. 1 letter
spells out a "shocking pattern of willful dereliction of federal responsibility" by E-
PA Regional 2 Administrator Judith Enck, who in newly released documents was
dismissive of the group's concerns, saying the agency took care of the problem
over the last decade..."

PR BANKRUPTICES UP 8.14% IN AUGUST

From News Is My Business:

"The number of bankruptcy cases filed in Puerto Rico was up 8.14 percent year-
over-year in August, when 929 cases were filed. So far this year, 7,038 petitions
have been filed at the U.S. Bankruptcy Court, representing a 4.25 percent jump
when compared to the same period last year, information provided by research
firm Boletín de Puerto Rico showed..."

Puerto Rico News Digest For July 5, 2016

GOVT MAKES PARTIAL INTEREST PAYMENT

From The San Juan Daily Star:

"The government of Puerto Rico said it would pay at least part of the interest
on bonds that came due at midnight on Friday, but in any case foresaw the grea-
test default on the debt to date. The different bonds that came due July 1 totaled
nearly $2 billion, of which some $700 million were general obligation (GO) bo-
nds, according to a CyberNews report. This type of bond is guaranteed by the
Puerto Rico Constitution, which assures that their payment has priority over any
other public expenditure that the commonwealth administration has incurred..."

PR UNVEILS FIRST LGBT MONUMENT

From The Advocate:

"Puerto Rico has unveiled its first LGBT monument, which also serves as a me-
morial to the 49 victims of the June 12 massacre at Orlando’s Pulse nightclub.
Most of the people killed were LGBT and Latino, and a majority of the victims
were of Puerto Rican descent. The monument, located in San Juan’s Third Mill-
ennium Park, is comprised of seven rectangular columns in rainbow colors, and
sits at the entrance to the Escobar the Sixth Stadium...At the base of the monum-
ent is a plaque highlighting the names of the 23 Puerto Rican victims killed in the
massacre, with the additional 26 victims listed below..."

BANKRUPTCIES REMAIN FLAT IN JUNE

From News Is My Business:

"Puerto Rico’s bankruptcy levels remained flat last month, when the total number
of companies and individuals who turned to the U.S. Bankruptcy Court for help
was up by two cases when compared to the same month in 2015. So far this year,
there are 5,291 bankruptcy cases on file, representing a 5.06 percent increase from
the same six-month period last year..."

NPP HOISTS 51-STAR US FLAG

From Caribbean Business:

"The secretary-general of the New Progressive Party (NPP), William Villafañe,
on Monday, July 4, removed the U.S. flag from on its pole at party headquarters
and hoisted a new flag, with 51 stars. The event comes about as part of an initia-
tive calling for the U.S. government to “respect the will of the people and give
way to a decolonization process in which statehood is attained,” Villafañe said
...Villafañe added that during the NPP’s monthly directors’ meeting, to be held
Tuesday, a resolution will be presented so all of the party’s municipal committe-
es hoist the 51-star flag “to deliver the message of equality and statehood,” he
said...'

Puerto Rico News Digest For January 7, 2016

LICENSES OK FOR TRAVEL TILL OCTOBER

The US Department of Homeland Security has granted Puerto Rico an
extension to meet the requirements of the 2005 Real ID act, giving tra-
velers until October 10th of this year to continue using Puerto Rico dri-
ver's licenses as a valid form of ID for air travel. All other federal agen-
cies will also continue to accept commonwealth driver's licenses as va-
lid ID until that date. The Real ID act seeks to create secure and  uni-
form identification cards in order to stymie terrorism, identity fraud and
other crimes. Puerto Rican travelers had become concerned when it had
recently been announced that Puerto Rico driver's licenses wouldn't be
accepted as valid ID at airports after January 10th.

FEW ATTEND FORTALEZA THREE KING'S PARTY

From Caribbean Business:

The low public attendance at the Three Kings fiesta organized by La For-
taleza in the municipality of Utuado ended with a lot of volleyballs, bas-
ketballs and footballs ready to be given as gifts during the holiday activi-
ty to remain in their plastic bags. Although several small children and ado-
lescents were carrying toys, various stacks of toys were left in their bags
in the Utuado sports complex. At the beginning of the event Wednesday
morning, some people came, but shortly after noon it began to rain and the
activity concluded..."

BANKRUPTCIES UP IN DECEMBER BY 5% 

From News Is My Business:

"Bankruptcy filings were up 5 percent year-over-year in December 2015,
when the number of Chapter 11 cases on record soared by 385 percent when
compared to the same month last year, according to preliminary figures relea-
sed Monday by research firm Boletín de Puerto Rico. A total of 881 cases were
filed during the month, representing 42 more cases when compared to Decem-
ber 2014..."

PR POLICE DEFENDS PROTOCOL AFTER SHOOTING

From Yahoo! News:

Puerto Rico's police chief says a policeman accused of fatally shooting three
officers at work underwent two psychological exams before his weapon was
returned. Jose Caldero says Guarionex Candelario passed both exams before
his gun was returned in January 2015. Candelario was charged with first-de-
gree murder in the Dec. 28 shootings and remains in jail on an $11 million
bond. He had been disarmed for 10 years while undergoing psychological
treatment..."

The Obama Administration Has No Shame

Commentary

by Richard Lawless


The Obama administration along with leading democrats are preparing 
to throw tens of thousands hard working Americans under the bus. The 
Administration is pushing hard for bankruptcy protection for Puerto Rico. 

This action would allow the government of Puerto Rico to cancel all 
active contracts with American companies and better negotiate the is-
lands staggering debt with its bondholders. These hardworking Ameri-
can families played by the rules and risk their capital to do business 
in Puerto Rico.

It is estimated that there are between 30-40 billion dollars of active con-
tracts with the government of Puerto Rico.  How many American fami-
lies will be ruined by this?  How many hardworking Americans will lose 
their retirement funds when the island defaults on their bonds?

The administration says it does not matter.  What matters is the Puerto
Rican vote. There is no limit to what wealth the administration will des-
troy or American treasure it will give away to guarantee reelection.

Puerto Rico is one of the most corrupt countries in the world. There are 
so many investigations going on in Puerto Rico that most of the U.S. 
Government agencies are constantly adding to staff to keep up. It app-
ears that the DOJ has been asked to “slow walk” critical investigations 
into billions of dollars in Puerto Rico bond fraud and billions in stolen pu-
blic monies.  The administration cannot risk having these investigations 
get in the way of its efforts to win bankruptcy protection and additional 
taxpayer money for the island.

Richard Lawless is CEO of Commercial Solar Power, Inc. in Temecula, CA. The opinions expressed 

in the preceding commentary are exclusively his own.

Puerto Rico News Digest For October 23, 2015

FEDS RAID HOUSING PROJECT

As reported this morning by El Nuevo Dia, federal agents have been
carrying out an operation since early this morning at Los Claveles
public housing project in Trujillo Alto. Agents are serving four sea-
rch warrants from the Immigration and Customs Enforcement agen-
cy (ICE). The operation has to do with drug trafficking and money
laundering, but ICE did not provide much in the way of further de-
tails, other than to say that illegal material was found among the
four apartments that were searched.  

PREPA TO PROPOSE 4 CENT RATE HIKE

From The San Juan Daily Star:

"The Puerto Rico Electric Power Authority (PREPA) plans to sub-
mit a new rate structure calling for a hike of around four cents, sour-
ces inside the utility said. The utility is still working on a study that
will help it decide what would be the appropriate rate. However, the
four-cent hike was the same as proposed by one of the utility’s insu-
rance companies. PREPA Chief Restructuring Offi cer Lisa Donahue
said on Tuesday that with the savings and cuts that have been made
at the utility, it expects to be able to submit a reasonable rate struct-
ure..."

SANDERS & WARREN BLAST VULTURE FUNDS

From News Is My Business:

"The two most prominent progressives in the U.S. Senate urged the
federal government Thursday to help Puerto Rico stand up against
the “vultures” they largely blame for the island’s current fiscal night-
mare. Sen. Bernie Sanders (I-VT), the chief rival of candidate Hilla-
ry Clinton for the 2016 Democratic presidential nomination, took ti-
me out of his packed campaign schedule to engage five witnesses —
including Puerto Rico Gov. Alejandro García-Padilla — who testifi-
ed at a hearing by the Senate Committee on Energy and Natural Re-
sources. Sanders, reeling off a raft of statistics on Puerto Rico’s de-
mographic and fiscal decline, called the island’s 56 percent poverty
rate among children a “human tragedy..."

OBAMA SEEKS BANKRUPTCY FOR PR

From The Chicago Tribune:

"President Barack Obama is pressing for Congress to give Puerto Rico
sweeping powers to reduce its $73 billion debt burden through bank-
ruptcy, escalating administration involvement as the Caribbean island's
access to cash dries up. Puerto Rico would be provided with a form of
bankruptcy protection not now available to American territories. Ad-
ministration officials also called for lawmakers late Wednesday to in-
crease health-care funding for Puerto Rico, extend tax credits to the
poor and put independent oversight in place to monitor the govern-
ment's budget..."

POPULAR POSTS $84.7 MILLION PROFIT

From Caribbean Business:

"Popular Inc. on Friday reported third-quarter net income of $84.7 mi-
llion. The Hato Rey, Puerto Rico-based bank said it had earnings of 82
cents per share. Earnings, adjusted for one-time gains and costs, were
90 cents per share. The a company that runs Banco Popular and other
banks in Puerto Rico and the U.S. posted revenue of $481.8 million in
the period..."

Puerto Rico News Digest For October 7, 2015

TOURIST HELD ON SEX TRAFFICKING CHARGE

From The San Juan Daily Star:

"A male tourist from Wisconsin was arrested by federal authorities for
sex trafficking after U.S. Magistrate Judge Marcos López authorized a
criminal complaint charging him with one count of Attempted Sex Tra-
fficking of Children, U.S. Attorney for the District of Puerto Rico Rosa
Emilia Rodríguez-Vélez announced Monday..."

SEARCH FOR ANSWERS IN EL FARO SINKING

From Caribbean Business:

"The 41-year-old El Faro was scheduled to be retired from Caribbean
duty and retrofitted in the coming months for service between the West Co-
ast and Alaska, said Phil Greene, another Tote executive. The El Faro and
its equally aged sister vessel were being replaced on the Jacksonville-to-Pu-
erto Rico run by two brand-new ships capable of carrying much more cargo
and emitting less pollution..."

PR BANKRUPTCY BILL ADDS CO-SPONSORS

From Reuters:

"A bill to allow Puerto Rico's distressed public agencies to access
Chapter 9 bankruptcy laws has drawn several Democratic co-sponsors but
is not a partisan move, the U.S. commonwealth's representative in Congress
said on Tuesday. Puerto Rico, with $72 billion debt..."

PUERTO RICO ENDURES RECORD HEAT

From Yahoo! News:

"Puerto Rico is facing a record-breaking heat wave this month amid an
ongoing drought. The National Weather Service said the first five days
of October are the  warmest in the history of the U.S. territory for the
month since record-keeping began..."

Puerto Rico News Digest For July 22, 2015

WATER RATIONING COMES TO THE SOUTH

Puerto Rico's water utility, Autoridad de Acueductos y Alcantarillados  (AAA), 

has announced the implementation of a water rationing program for sectors of the 

municipalities of Coamo, Santa Isabel and Salinas, as the island's worst drought in 

decades threatens underground aquifers in the region. Twelve-hour rationing, where

water flow is cut off to users for 12 hours at a time, begins Thursday, July 23. The 

rationing area is divided into two zones, A and B (see the map above to find out

which neighborhoods are in which zones). Zone A will be the first to see the water

stop flowing at midnight tonight. Water will be reestablished at noon, and then Zone

B will have its water cut off for 12 hours. AAA will not run water oases in these towns,

as rationing will initially only be 12 hours. 

PREPA APPOINTS NEW EXECUTIVE DIRECTOR

From Caribbean Business:

The Puerto Rico Electric Power Authority (Prepa) announced Tuesday the designa-

tion of Javier Quintana Méndez as the new executive director of the financially trou-

bled utility, effective Aug. 3. "The successful transformation of Prepa is crucial for 

Puerto Rico and its citizens. The Governing Board of Prepa selected Dr. Quintana as 

executive director at this important moment, because we believe that his experience 

and background in the energy field will help Prepa reach its goal of becoming a self-

sustaining corporation. Now is the time for the crucial decisions that require great lea-

dership," said Harry Rodríguez, chairman of the utility’s board. Quintana Méndez, 

who has been vice president of Prepa’s board for the past two years, is currently the 

dean of the engineering school at Universidad Interamericana de Puerto Rico, Baya-

món campus, and a member of the Interamerican Board of Energy Resources Direc-

tors. Moreover, he is a former executive director of the Solid Waste Authority (2005-

2008).

TWO MORE SENATORS BACK CHAPTER 9 BILL

From News Is My Business:

Resident Commissioner Pedro Pierluisi announced Tuesday that Senator Patrick Leahy 

of Vermont, the Ranking Democrat on the Senate Judiciary Committee, will cosponsor S. 

1774, the identical companion bill in the Senate to HR 870, the Puerto Rico Chapter 9 

Uniformity Act, which Pierluisi introduced in the House of Representatives in February.

Senator Leahy’s office advised Pierluisi’s office and Leahy will be formally added as a 

cosponsor. In addition, Senator Mark Warner of Virginia, a moderate who sits on the 

Senate Banking Committee and the Senate Finance Committee, has also agreed to co-

sponsor S. 1774, which was introduced last week by Senator Richard Blumenthal of Co-

nnecticut, Senator Charles Schumer of New York, and 10 other U.S. Senators, including 

Minority Leader Harry Reid of Nevada.

PR BASKETBALL TEAM LOSES PAN AM OPENER

From The Courier-Journal:

Rick Pitino's international coaching debut on Tuesday morning was an forgettable 

one. Pitino, coaching Puerto Rico's national team at the Pan Am Games here in Ca-

nada, saw his squad fall behind by 25 points in the first quarter, shoot 33 percent 

and lose 92-59 in a lopsided opener against Brazil at the Mattamy Athletic Centre 

on Ryerson University's campus. The 33-point loss matched a 2009 U of L loss at 

Notre Dame for the worst defeat by a Rick Pitino-coached team in at least the last 

15 years.

Puerto Rico News Digest For July 13, 2015

PR IN TENSE TALKS WITH BONDHOLDERS 

From Bloomberg:

If you thought Greece’s negotiations with its creditors were ugly, just wait for
the reception Puerto Rico officials will receive after saying they want to re-
structure their $72 billion debt load.More than 300 participants ranging from
institutional investors to hedge funds to bond insurers are scheduled to attend
Monday’s presentation in New York explaining why the Caribbean island can-
not repay all of its obligations on time. Complicating matters is a push by co-
mmonwealth officials to seek federal assistance and even changes in bankrup-
tcy laws. “It will be a very protracted battle given Puerto Rico lacks a mecha-
nism for restructuring like Chapter 9,” Peter Hayes, head of municipal debt at
BlackRock Inc., which manages $114 billion of the securities, including Puerto
Rico debt, said in an e-mail. “There is likely to be a multitude of lawsuits given
the unlikely event creditors are acceptable to terms to be proposed by Puerto
Rico.”

PR TO APPEAL RECOVERY ACT RULING

From The San Juan Daily Star:

The Puerto Rico government will appeal to the U.S. Supreme Court sometime
over the next 90 days the First Circuit Court of Appeals ruling that declared a
local bankruptcy law for public corporations unconstitutional because it was
pre-empted by the U.S. Bankruptcy Code. Justice Secretary César Miranda
announced Thursday that after a thorough evaluation, the agency decided to
file a request for certiorari to have Law 71 validated. “Puerto Rico has the
power to legislate on the matter of bankruptcy because Congress excluded the
island from the protection of the Bankruptcy Law,” the agency said in a state-
ment.

PIERLUISI CRTICIZES LACK OF PRIMARY FUNDS

From Caribbean Business:

On Sunday, Puerto Rico Resident Commissioner Pedro Pierluisi called it "an
attack on democracy," the decision by the Alejandro García Padilla adminis-
tration not to allocate funds to political parties for primary elections. The New
Progressive Party (NPP) president and governorship candidate also said the
NPP will go to court if the government does not resolve the situation in the
coming weeks. "Clearly, the Popular Democratic Party [PDP] administration
wants to restrict participatory democracy, specifically against the party which
I preside. It is completely illegal to try to prevent primary elections, which by
law are scheduled for June 2016. If the PPD does not believe in democracy,
the NPP will enforce it," Pierluisi said, while adding that it is another act of
political persecution against minorities and opposition.

LATEST WATER RESERVOIR LEVELS

Carraizo's level is slightly up, at 35.44 cm, while La Plata is down to 38.15

cm as of the morning of July 13. Click the graphic to enlarge.

Puerto Rico News Digest For July 7, 2015

COURT: PR BANKRUPTCY UNCONSTITUTIONAL

From Caribbean Business:

The U.S. Court of Appeals for the First Circuit has ruled the Puerto Rico Public
Corporation Debt Compliance & Recovery Act of 2014 unconstitutional. A panel
comprising Judges Sandra Lynch, Juan Torruella and Jeffrey Howard was in char-
ge of the appeal at the Boston court. The Recovery Act intended to provide a bank-
ruptcy-like process for the commonwealth’s troubled public corporations, inclu-
ding the Puerto Rico Electric Power Authority (Prepa), which would allow them
to restructure their debt, giving the commonwealth much more flexibility to nego-
tiate repayment terms and even the ability to default on public corporations’ bonds.

[The ruling can be read here in.pdf format]

LA PLATA RESERVOIR DOWN 12 CENTIMETERS

Despite Guaynabo being added to the water rationing plan being enacted by the
island's water utility, AAA, the La Plata reservoir's level was down 12 centime-
ters over the last 24 hours as of this morning. The Carraízo reservoir was down
10 centimeters over the same period. The latest reservoir levels are above, with
Carraízo on the far left and La Plata immediately to its right (click on picture to
enlarge).

CLINTON SUPPORTS PUERTO RICO BANKRUPTCY

From Reuters:

U.S. Democratic presidential candidate Hillary Clinton said Tuesday that Puerto
Rico's public entities should be able to use U.S. bankruptcy laws to restructure
some $72 billion in debt. "Congress and the Obama administration need to partner
with Puerto Rico by providing real support and tools so that Puerto Rico can do
the hard work it will take to get on a path toward stability and prosperity," Clinton
said in a statement provided to Reuters.

PALMAS DEL MAR GOES SOLAR

From News Is My Business:

The Palmas del Mar Homeowners Association recently inaugurated a $227,000 

photovoltaic project, the first at Palmas del Mar, which will supply the electrical 

needs of it’s main building, an 11,000 square-foot facility.The project consists of 

292 solar panels of 250 watts each, which will produce approximately 117,238 Kw. 

hour per year. The PHA estimates it will save some $25,000 per year, and will see 

a return on its investment is approximately 4.5 years. The PHA received a $90,800 

incentive from the government to build the project, said Antonio Maldonado, exe-

cutive director of PHA.

Puerto Rico News Digest For March 13, 2015

CUBAN MIGRANTS RESCUED FROM MONITO

Photo: U.S. Coast Guard

From Local 10:

The U.S. Coast Guard rescued eight Cuban migrants from Monito Island,
Puerto Rico Wednesday afternoon, following a two-day rescue effort in the
Mona Passage. Authorities said the seven men and woman were spotted
Tuesday afternoon by a Coast Guard  pilot who was on a routine patrol
in the Mona Passage. Authorities said the group was stranded at the
bottom of a 150-foot  cliff of the uninhabited island, which is a natural
reserve and serves as a bird habitat.

DUTCH TRAVELER KILLED IN HIT AND RUN

Globetrotter and sailor Laurens Higler, age 26, was killed this
morning on Road 3 in Guayama after being struck by a car. The
driver fled the scene after the incident.  The deceased, who was
from Holland, was stopping off in Puerto Rico during his travels
around the globe.  Police have stated that they have recovered
physical evidence which could lead them to the driver who struck
Higler.

GOVERNOR DEFENDS IVA TV MESSAGE

From The San Juan Daily Star:

Gov. Alejandro García Padilla on Wednesday defended his most recent
pre-recorded televised message, in which he justified his proposed tax
reform and the 16 percent value added tax. “What this message was
about, at the end of the day, is to be  able to speak to people directly,
and there is a public purpose that is priceless,” García Padilla said in
TV interview. “We are talking about a profound transformation and
all transformations convey resistances.”

EIGHT MURDER VICTIMS IN LESS THAN A WEEK

As reported today by El Vocero, eight people were killed -- mostly in
shootings -- between Tuesday afternoon and early Friday morning.
The incidents were reported in Hato Rey, Santurce, Yabucoa, Bayamón
and San Lorenzo. This week's murders bring the total for the month to
20, five more than at this time last year. So far, 103 violent deaths have
been registered in Puerto Rico, 27 less than last year.

MOODY'S DOWNGRADES UPR BONDS

From Caribbean Business:

Moody's Investors Service said it downgraded $489 million of  University
of Puerto Rico University system revenue bonds to  Caa2 from Caa1 and
$73 million of educational facilities revenue bonds, 2000 Series A issued
through AFICA to Caa3 from Caa2. The outlook is negative.

The rating differential between the university system revenue bonds and
the educational facilities revenue bonds reflects the subordinate pledge
and lease structure of the educational facilities revenue bonds.

DORAL BANK GOES TO CHAPTER 11 BANKRUPTCY

From Reuters:

Doral Financial Corp filed for Chapter 11 bankruptcy protection  on
Wednesday to wind down its remaining operations two weeks after its
Puerto Rico-based bank subsidiary was seized by regulators. Doral
Financial's bankruptcy is the latest reminder of the financial crisis on
the island, a U.S. commonwealth, which has been mired for years in
an economic slump. The bank has also been dogged by accounting
problems and an employee was recently indicted for money laundering.



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Let Puerto Rico Go Bankrupt

Opinion

BloombergView

In an ideal world, Puerto Rico would be bankrupt. Instead, it is sliding
toward something far more dangerous and uncertain -- and President
Barack Obama and Congress need to intervene.

On Thursday, the House Judiciary Committee is taking up a long-shot
bill to allow the island's public-sector corporations to declare bankruptcy.
Providing these protections isn’t any kind of a bailout. It will just help
Puerto Rico’s government begin to ease a debt-servicing burden that
consumes 16 percent of its budget. It will also ensure that not just the
biggest or loudest creditors get paid.

This crisis has been a long time brewing. Since 2006, Puerto Rico's
economy has contracted every year but one. Its unemployment rate of
13.7 percent is double that of the U.S. mainland; its poverty rate is twice
that of Mississippi. Meanwhile, Puerto Rico's population and tax base
have aged and shrunk...[CONTINUE READING]