Puerto Rico Recovery Accuracy in Disclosures Act of 2021

Floor Speech

I rise today in support of the Senate amendment to H.R. 1192, the Puerto Rico Recovery Accuracy in Disclosures Act of 2021.

In 2016, Puerto Rico was experiencing severe financial pressure from significant debt and related obligations.

In response to Puerto Rico's financial distress, Congress enacted the Puerto Rico Oversight, Management, and Economic Stability Act of 2016. That 2016 law created a bankruptcy process for Puerto Rico.

Like existing bankruptcy law in 2016, the law permitted certain professionals working on Puerto Rico's bankruptcy, like lawyers and accountants, to apply to get paid for their services pending judicial approval.

But the 2016 law lacked certain disclosure requirements for these professionals that would typically apply to restructuring professionals in other bankruptcy cases.

The gap in the 2016 law created the potential for undisclosed conflicts of interest for professionals involved in Puerto Rico's bankruptcy.

This bill fills the gap by mandating the necessary disclosure requirements. The bill also establishes a process for overseeing and policing disclosures that bankruptcy professionals make.

H.R. 1192 passed the House unanimously in February of 2021. In December, the Senate passed H.R. 1192 with a few minor amendments to improve the bill's administrative abilities. The amendments also enhanced the incentives for professionals to make significant efforts to comply with the new disclosure requirements.

H.R. 1192 will serve important goals and interests, including the interests of creditors and taxpayers and Puerto Rico itself.

Mr. Speaker, I encourage my colleagues to support this bill, and I reserve the balance of my time.

Miss GONZALEZ-COLON. Mr. Speaker, I rise in support of the approval in the House of the Senate amendment to H.R. 1192, the Puerto Rico Recovery Accuracy in Disclosures Act of 2021.

I joined Representative Velazquez to promote this bipartisan and commonsense bill to help ensure the restructuring process under PROMESA serves Puerto Rico's interests. Actually, just this week, the plan was approved by the Federal Court, so this is perfect timing to approve this bill today.

Though it required some technical corrections, it is satisfying to see this bill has already achieved passage in both Chambers. I wish for my colleague, Congresswoman Velazquez, to be fully recovered in time to see it become law.

The intent of this legislation remains the same, and this bill will require any person or firm hired as legal, financial or technical staff or consultants for the Financial Oversight Board in the court cases for the restructuring of Puerto Rico's debt, to submit verified disclosures of all connections with debtors, creditors, or other interested parties in the process, before being compensated.

Our intention is not to exclude people with experience in Puerto Rico's financial transactions from being resources in the restructuring process, but it is essential that their connection to any parties interested in those transactions be known. Conflict of interest, or the appearance of conflict of interest, can be best avoided if there is accountability and transparency.

Anyone working to inform the Board's decisions, or representing it before the court, needs to be committed to defending the interests of the people of Puerto Rico first, in accordance with the law and justice.

Lack of transparency creates a lack of trust, and this bill will work toward avoiding that by making these disclosures a legal mandate rather than the Board's own discretion.

Our goal is to reach the day we no longer need the provisions of PROMESA and the Oversight Board, but until that happens, these instruments must be accountable and transparent.

I ask my colleagues to support the passage of the Senate amendment to H.R. 1192, the Puerto Rico Recovery Accuracy in Disclosures Act of 2021.

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Mr. FITZGERALD. Mr. Speaker, I just reiterate that I think there is a lot of support in the Chamber, and I support it as well.

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