114TH CONGRESS 

2D SESSION H. R. 5278 

AN ACT 

To establish an Oversight Board to assist the Government 

of Puerto Rico, including instrumentalities, in managing 

its public finances, and for other purposes. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 
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1 SECTION 1. SHORT TITLE; TABLE OF CONTENTS. 

2 (a) SHORT TITLE.—This Act may be cited as the 

3 ‘‘Puerto Rico Oversight, Management, and Economic Sta4 bility Act’’ or ‘‘PROMESA’’. 

5 (b) TABLE OF CONTENTS.—The table of contents of 

6 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. 
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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. 

Sec. 411. Report on territorial debt. 

Sec. 412. Expansion of HUBZones in Puerto Rico. 

Sec. 413. Determination on debt. 

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, PROGROWTH FISCAL REFORMS 

Sec. 701. Sense of Congress regarding permanent, pro-growth fiscal reforms. 
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1 SEC. 2. EFFECTIVE DATE. 

2 (a) IN GENERAL.—Except as provided in subsection 

3 (b), this Act shall take effect on the date of the enactment 

4 of this Act. 

5 (b) TITLE III AND TITLE VI.— 

6 (1) Title III shall apply with respect to cases 

7 commenced under title III on or after the date of 

8 the enactment of this Act. 

9 (2) Titles III and VI shall apply with respect to 

10 debts, claims, and liens (as such terms are defined 

11 in section 101 of title 11, United States Code) cre12 ated before, on, or after such date. 

13 SEC. 3. SEVERABILITY. 

14 (a) IN GENERAL.—Except as provided in subsection 

15 (b), if any provision of this Act or the application thereof 

16 to any person or circumstance is held invalid, the remain17 der of this Act, or the application of that provision to per18 sons or circumstances other than those as to which it is 

19 held invalid, is not affected thereby, provided that title III 

20 is not severable from titles I and II, and titles I and II 

21 are not severable from title III. 

22 (b) UNIFORMITY.—If a court holds invalid any provi23 sion of this Act or the application thereof on the ground 

24 that the provision fails to treat similarly situated terri25 tories uniformly, then the court shall, in granting a rem26 edy, order that the provision of this Act or the application 
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1 thereof be extended to any other similarly situated terri2 tory, provided that the legislature of that territory adopts 

3 a resolution signed by the territory’s governor requesting 

4 the establishment and organization of a Financial Over5 sight and Management Board pursuant to section 101. 

6 SEC. 4. SUPREMACY. 

7 The provisions of this Act shall prevail over any gen8 eral or specific provisions of territory law, State law, or 

9 regulation that is inconsistent with this Act. 

10 SEC. 5. DEFINITIONS. 

11 In this Act— 

12 (1) AGREED ACCOUNTING STANDARDS.—The 

13 term ‘‘agreed accounting standards’’ means modified 

14 accrual accounting standards or, for any period dur15 ing which the Oversight Board determines in its sole 

16 discretion that a territorial government is not rea17 sonably capable of comprehensive reporting that 

18 complies with modified accrual accounting stand19 ards, such other accounting standards as proposed 

20 by the Oversight Board. 

21 (2) BOND.—The term ‘‘Bond’’ means a bond, 

22 loan, letter of credit, other borrowing title, obligation 

23 of insurance, or other financial indebtedness for bor24 rowed money, including rights, entitlements, or obli25 gations whether such rights, entitlements, or obliga-
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1 tions arise from contract, statute, or any other 

2 source of law, in any case, related to such a bond, 

3 loan, letter of credit, other borrowing title, obligation 

4 of insurance, or other financial indebtedness in phys5 ical or dematerialized form of which the issuer, obli6 gor, or guarantor is the territorial government. 

7 (3) BOND CLAIM.—The term ‘‘Bond Claim’’ 

8 means, as it relates to a Bond— 

9 (A) right to payment, whether or not such 

10 right is reduced to judgment, liquidated, unliq11 uidated, fixed, contingent, matured, unmatured, 

12 disputed, undisputed, legal, equitable, secured, 

13 or unsecured; or 

14 (B) right to an equitable remedy for 

15 breach of performance if such breach gives rise 

16 to a right to payment, whether or not such 

17 right to an equitable remedy is reduced to judg18 ment, fixed, contingent, matured, unmatured, 

19 disputed, undisputed, secured, or unsecured. 

20 (4) BUDGET.—The term ‘‘Budget’’ means the 

21 Territory Budget or an Instrumentality Budget, as 

22 applicable. 

23 (5) PUERTO RICO.—The term ‘‘Puerto Rico’’ 

24 means the Commonwealth of Puerto Rico. 
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1 (6) COMPLIANT BUDGET.—The term ‘‘compli2 ant budget’’ means a budget that is prepared in ac3 cordance with— 

4 (A) agreed accounting standards; and 

5 (B) the applicable Fiscal Plan. 

6 (7) COVERED TERRITORIAL INSTRUMEN7 TALITY.—The term ‘‘covered territorial instrumen8 tality’’ means a territorial instrumentality des9 ignated by the Oversight Board pursuant to section 

10 101 to be subject to the requirements of this Act. 

11 (8) COVERED TERRITORY.—The term ‘‘covered 

12 territory’’ means a territory for which an Oversight 

13 Board has been established under section 101. 

14 (9) EXECUTIVE DIRECTOR.—The term ‘‘Execu15 tive Director’’ means an Executive Director ap16 pointed under section 103(a). 

17 (10) FISCAL PLAN.—The term ‘‘Fiscal Plan’’ 

18 means a Territory Fiscal Plan or an Instrumentality 

19 Fiscal Plan, as applicable. 

20 (11) GOVERNMENT OF PUERTO RICO.—The 

21 term ‘‘Government of Puerto Rico’’ means the Com22 monwealth of Puerto Rico, including all its terri23 torial instrumentalities. 

24 (12) GOVERNOR.—The term ‘‘Governor’’ means 

25 the chief executive of a covered territory. 
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1 (13) INSTRUMENTALITY BUDGET.—The term 

2 ‘‘Instrumentality Budget’’ means a budget for a cov3 ered territorial instrumentality, designated by the 

4 Oversight Board in accordance with section 101, 

5 submitted, approved, and certified in accordance 

6 with section 202. 

7 (14) INSTRUMENTALITY FISCAL PLAN.—The 

8 term ‘‘Instrumentality Fiscal Plan’’ means a fiscal 

9 plan for a covered territorial instrumentality, des10 ignated by the Oversight Board in accordance with 

11 section 101, submitted, approved, and certified in 

12 accordance with section 201. 

13 (15) LEGISLATURE.—The term ‘‘Legislature’’ 

14 means the legislative body responsible for enacting 

15 the laws of a covered territory. 

16 (16) MODIFIED ACCRUAL ACCOUNTING STAND17 ARDS.—The term ‘‘modified accrual accounting 

18 standards’’ means recognizing revenues as they be19 come available and measurable and recognizing ex20 penditures when liabilities are incurred, in each case 

21 as defined by the Governmental Accounting Stand22 ards Board, in accordance with generally accepted 

23 accounting principles. 

24 (17) OVERSIGHT BOARD.—The term ‘‘Oversight 

25 Board’’ means a Financial Oversight and Manage-
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1 ment Board established in accordance with section 

2 101. 

3 (18) TERRITORIAL GOVERNMENT.—The term 

4 ‘‘territorial government’’ means the government of a 

5 covered territory, including all covered territorial in6 strumentalities. 

7 (19) TERRITORIAL INSTRUMENTALITY.— 

8 (A) IN GENERAL.—The term ‘‘territorial 

9 instrumentality’’ means any political subdivi10 sion, public agency, instrumentality—including 

11 any instrumentality that is also a bank—or 

12 public corporation of a territory, and this term 

13 should be broadly construed to effectuate the 

14 purposes of this Act. 

15 (B) EXCLUSION.—The term ‘‘territorial in16 strumentality’’ does not include an Oversight 

17 Board. 

18 (20) TERRITORY.—The term ‘‘territory’’ 

19 means— 

20 (A) Puerto Rico; 

21 (B) Guam; 

22 (C) American Samoa; 

23 (D) the Commonwealth of the Northern 

24 Mariana Islands; or 

25 (E) the United States Virgin Islands. 
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1 (21) TERRITORY BUDGET.—The term ‘‘Terri2 tory Budget’’ means a budget for a territorial gov3 ernment submitted, approved, and certified in ac4 cordance with section 202. 

5 (22) TERRITORY FISCAL PLAN.—The term 

6 ‘‘Territory Fiscal Plan’’ means a fiscal plan for a 

7 territorial government submitted, approved, and cer8 tified in accordance with section 201. 

9 SEC. 6. PLACEMENT. 

10 The Law Revision Counsel is directed to place this 

11 Act as chapter 20 of title 48, United States Code. 

12 SEC. 7. COMPLIANCE WITH FEDERAL LAWS. 

13 Except as otherwise provided in this Act, nothing in 

14 this Act shall be construed as impairing or in any manner 

15 relieving a territorial government, or any territorial instru16 mentality thereof, from compliance with Federal laws or 

17 requirements or territorial laws and requirements imple18 menting a federally authorized or federally delegated pro19 gram protecting the health, safety, and environment of 

20 persons in such territory. 
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1 TITLE I—ESTABLISHMENT AND 

2 ORGANIZATION OF OVER3 SIGHT BOARD 

4 SEC. 101. FINANCIAL OVERSIGHT AND MANAGEMENT 

5 BOARD. 

6 (a) PURPOSE.—The purpose of the Oversight Board 

7 is to provide a method for a covered territory to achieve 

8 fiscal responsibility and access to the capital markets. 

9 (b) ESTABLISHMENT.— 

10 (1) PUERTO RICO.—A Financial Oversight and 

11 Management Board is hereby established for Puerto 

12 Rico. 

13 (2) CONSTITUTIONAL BASIS.—The Congress en14 acts this Act pursuant to article IV, section 3 of the 

15 Constitution of the United States, which provides 

16 Congress the power to dispose of and make all need17 ful rules and regulations for territories. 

18 (c) TREATMENT.—An Oversight Board established 

19 under this section— 

20 (1) shall be created as an entity within the ter21 ritorial government for which it is established in ac22 cordance with this title; and 

23 (2) shall not be considered to be a department, 

24 agency, establishment, or instrumentality of the 

25 Federal Government. 
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1 (d) OVERSIGHT OF TERRITORIAL INSTRUMENTAL2 ITIES.— 

3 (1) DESIGNATION.— 

4 (A) IN GENERAL.—An Oversight Board, in 

5 its sole discretion at such time as the Oversight 

6 Board determines to be appropriate, may des7 ignate any territorial instrumentality as a cov8 ered territorial instrumentality that is subject 

9 to the requirements of this Act. 

10 (B) BUDGETS AND REPORTS.—The Over11 sight Board may require, in its sole discretion, 

12 the Governor to submit to the Oversight Board 

13 such budgets and monthly or quarterly reports 

14 regarding a covered territorial instrumentality 

15 as the Oversight Board determines to be nec16 essary and may designate any covered terri17 torial instrumentality to be included in the Ter18 ritory Budget; except that the Oversight Board 

19 may not designate a covered territorial instru20 mentality to be included in the Territory Budg21 et if applicable territory law does not require 

22 legislative approval of such covered territorial 

23 instrumentality’s budget. 

24 (C) SEPARATE INSTRUMENTALITY BUDG25 ETS AND REPORTS.—The Oversight Board in 
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1 its sole discretion may or, if it requires a budg2 et from a covered territorial instrumentality 

3 whose budget does not require legislative ap4 proval under applicable territory law, shall des5 ignate a covered territorial instrumentality to 

6 be the subject of an Instrumentality Budget 

7 separate from the applicable Territory Budget 

8 and require that the Governor develop such an 

9 Instrumentality Budget. 

10 (D) INCLUSION IN TERRITORY FISCAL

11 PLAN.—The Oversight Board may require, in 

12 its sole discretion, the Governor to include a 

13 covered territorial instrumentality in the appli14 cable Territory Fiscal Plan. Any covered terri15 torial instrumentality submitting a separate In16 strumentality Fiscal Plan must also submit a 

17 separate Instrumentality Budget. 

18 (E) SEPARATE INSTRUMENTALITY FISCAL

19 PLANS.—The Oversight Board may designate, 

20 in its sole discretion, a covered territorial in21 strumentality to be the subject of an Instru22 mentality Fiscal Plan separate from the appli23 cable Territory Fiscal Plan and require that the 

24 Governor develop such an Instrumentality Fis25 cal Plan. Any covered territorial instrumentality 
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1 submitting a separate Instrumentality Fiscal 

2 Plan shall also submit a separate Instrumen3 tality Budget. 

4 (2) EXCLUSION.— 

5 (A) IN GENERAL.—An Oversight Board, in 

6 its sole discretion, at such time as the Oversight 

7 Board determines to be appropriate, may ex8 clude any territorial instrumentality from the 

9 requirements of this Act. 

10 (B) TREATMENT.—A territorial instrumen11 tality excluded pursuant to this paragraph shall 

12 not be considered to be a covered territorial in13 strumentality. 

14 (e) MEMBERSHIP.— 

15 (1) IN GENERAL.— 

16 (A) The Oversight Board shall consist of 

17 seven members appointed by the President who 

18 meet the qualifications described in subsection 

19 (f) and section 109(a). 

20 (B) The Board shall be comprised of one 

21 Category A member, one Category B member, 

22 two Category C members, one Category D 

23 member, one Category E member, and one Cat24 egory F member. 

25 (2) APPOINTED MEMBERS.— 
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1 (A) The President shall appoint the indi2 vidual members of the Oversight Board, of 

3 which— 

4 (i) the Category A member should be 

5 selected from a list of individuals sub6 mitted by the Speaker of the House of 

7 Representatives; 

8 (ii) the Category B member should be 

9 selected from a separate, non-overlapping 

10 list of individuals submitted by the Speak11 er of the House of Representatives; 

12 (iii) the Category C members should 

13 be selected from a list submitted by the 

14 Majority Leader of the Senate; 

15 (iv) the Category D member should be 

16 selected from a list submitted by the Mi17 nority Leader of the House of Representa18 tives; 

19 (v) the Category E member should be 

20 selected from a list submitted by the Mi21 nority Leader of the Senate; and 

22 (vi) the Category F member may be 

23 selected in the President’s sole discretion. 
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1 (B) After the President’s selection of the 

2 Category F Board member, for purposes of sub3 paragraph (A) and within a timely manner— 

4 (i) the Speaker of the House of Rep5 resentatives shall submit two non-overlap6 ping lists of at least three individuals to 

7 the President; one list shall include three 

8 individuals who maintain a primary resi9 dence in the territory or have a primary 

10 place of business in the territory; 

11 (ii) the Senate Majority Leader shall 

12 submit a list of at least four individuals to 

13 the President; 

14 (iii) the Minority Leader of the House 

15 of Representatives shall submit a list of at 

16 least three individuals to the President; 

17 and 

18 (iv) the Minority Leader of the Senate 

19 shall submit a list of at least three individ20 uals to the President. 

21 (C) If the President does not select any of 

22 the names submitted under subparagraphs (A) 

23 and (B), then whoever submitted such list may 

24 supplement the lists provided in this subsection 

25 with additional names. 
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1 (D) The Category A member shall main2 tain a primary residence in the territory or have 

3 a primary place of business in the territory. 

4 (E) With respect to the appointment of a 

5 Board member in Category A, B, C, D, or E, 

6 such an appointment shall be by and with the 

7 advice and consent of the Senate, unless the 

8 President appoints an individual from a list, as 

9 provided in this subsection, in which case no 

10 Senate confirmation is required. 

11 (F) In the event of a vacancy of a Cat12 egory A, B, C, D, or E Board seat, the cor13 responding congressional leader referenced in 

14 subparagraph (A) shall submit a list pursuant 

15 to this subsection within a timely manner of the 

16 Board member’s resignation or removal becom17 ing effective. 

18 (G) With respect to an Oversight Board 

19 for Puerto Rico, in the event any of the 7 mem20 bers have not been appointed by September 1, 

21 2016, then the President shall appoint an indi22 vidual from the list for the current vacant cat23 egory by September 15, 2016, provided that 

24 such list includes at least 2 individuals per va25 cancy who meet the requirements set forth in 
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1 subsection (f) and section 109, and are willing 

2 to serve. 

3 (3) EX OFFICIO MEMBER.—The Governor, or 

4 the Governor’s designee, shall be an ex officio mem5 ber of the Oversight Board without voting rights. 

6 (4) CHAIR.—The voting members of the Over7 sight Board shall designate one of the voting mem8 bers of the Oversight Board as the Chair of the 

9 Oversight Board (referred to hereafter in this Act as 

10 the ‘‘Chair’’) within 30 days of the full appointment 

11 of the Oversight Board. 

12 (5) TERM OF SERVICE.— 

13 (A) IN GENERAL.—Each appointed mem14 ber of the Oversight Board shall be appointed 

15 for a term of 3 years. 

16 (B) REMOVAL.—The President may re17 move any member of the Oversight Board only 

18 for cause. 

19 (C) CONTINUATION OF SERVICE UNTIL

20 SUCCESSOR APPOINTED.—Upon the expiration 

21 of a term of office, a member of the Oversight 

22 Board may continue to serve until a successor 

23 has been appointed. 

24 (D) REAPPOINTMENT.—An individual may 

25 serve consecutive terms as an appointed mem-
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1 ber, provided that such reappointment occurs in 

2 compliance with paragraph (6). 

3 (6) VACANCIES.—A vacancy on the Oversight 

4 Board shall be filled in the same manner in which 

5 the original member was appointed. 

6 (f) ELIGIBILITY FOR APPOINTMENTS.—An individual 

7 is eligible for appointment as a member of the Oversight 

8 Board only if the individual— 

9 (1) has knowledge and expertise in finance, mu10 nicipal bond markets, management, law, or the orga11 nization or operation of business or government; and 

12 (2) prior to appointment, an individual is not 

13 an officer, elected official, or employee of the terri14 torial government, a candidate for elected office of 

15 the territorial government, or a former elected offi16 cial of the territorial government. 

17 (g) NO COMPENSATION FOR SERVICE.—Members of 

18 the Oversight Board shall serve without pay, but may re19 ceive reimbursement from the Oversight Board for any 

20 reasonable and necessary expenses incurred by reason of 

21 service on the Oversight Board. 

22 (h) ADOPTION OF BYLAWS FOR CONDUCTING BUSI23 NESS OF OVERSIGHT BOARD.— 

24 (1) IN GENERAL.—As soon as practicable after 

25 the appointment of all members and appointment of 
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1 the Chair, the Oversight Board shall adopt bylaws, 

2 rules, and procedures governing its activities under 

3 this Act, including procedures for hiring experts and 

4 consultants. Such bylaws, rules, and procedures shall 

5 be public documents, and shall be submitted by the 

6 Oversight Board upon adoption to the Governor, the 

7 Legislature, the President, and Congress. The Over8 sight Board may hire professionals as it determines 

9 to be necessary to carry out this Act. 

10 (2) ACTIVITIES REQUIRING APPROVAL OF MA11 JORITY OF MEMBERS.—Under the bylaws adopted 

12 pursuant to paragraph (1), the Oversight Board 

13 may conduct its operations under such procedures as 

14 it considers appropriate, except that an affirmative 

15 vote of a majority of the members of the Oversight 

16 Board’s full appointed membership shall be required 

17 in order for the Oversight Board to approve a Fiscal 

18 Plan under section 201, to approve a Budget under 

19 section 202, to cause a legislative act not to be en20 forced under section 204, or to approve or dis21 approve an infrastructure project as a Critical 

22 Project under section 503. 

23 (3) ADOPTION OF RULES AND REGULATIONS OF

24 TERRITORIAL GOVERNMENT.—The Oversight Board 

25 may incorporate in its bylaws, rules, and procedures 
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1 under this subsection such rules and regulations of 

2 the territorial government as it considers appro3 priate to enable it to carry out its activities under 

4 this Act with the greatest degree of independence 

5 practicable. 

6 (4) EXECUTIVE SESSION.—Upon a majority 

7 vote of the Oversight Board’s full voting member8 ship, the Oversight Board may conduct its business 

9 in an executive session that consists solely of the 

10 Oversight Board’s voting members and any profes11 sionals the Oversight Board determines necessary 

12 and is closed to the public, but only for the business 

13 items set forth as part of the vote to convene an ex14 ecutive session. 

15 SEC. 102. LOCATION OF OVERSIGHT BOARD. 

16 The Oversight Board shall have an office in the cov17 ered territory and additional offices as it deems necessary. 

18 At any time, any department or agency of the United 

19 States may provide the Oversight Board use of Federal 

20 facilities and equipment on a reimbursable or non-reim21 bursable basis and subject to such terms and conditions 

22 as the head of that department or agency may establish. 
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1 SEC. 103. EXECUTIVE DIRECTOR AND STAFF OF OVERSIGHT 

2 BOARD. 

3 (a) EXECUTIVE DIRECTOR.—The Oversight Board 

4 shall have an Executive Director who shall be appointed 

5 by the Chair with the consent of the Oversight Board. The 

6 Executive Director shall be paid at a rate determined by 

7 the Oversight Board. 

8 (b) STAFF.—With the approval of the Chair, the Ex9 ecutive Director may appoint and fix the pay of additional 

10 personnel as the Executive Director considers appropriate, 

11 except that no individual appointed by the Executive Di12 rector may be paid at a rate greater than the rate of pay 

13 for the Executive Director unless the Oversight Board pro14 vides for otherwise. The staff shall include a Revitalization 

15 Coordinator appointed pursuant to Title V of this Act. 

16 Any such personnel may include private citizens, employ17 ees of the Federal Government, or employees of the terri18 torial government, provided, however, that the Executive 

19 Director may not fix the pay of employees of the Federal 

20 Government or the territorial government. 

21 (c) INAPPLICABILITY OF CERTAIN EMPLOYMENT

22 AND PROCUREMENT LAWS.—The Executive Director and 

23 staff of the Oversight Board may be appointed and paid 

24 without regard to any provision of the laws of the covered 

25 territory or the Federal Government governing appoint26 ments and salaries. Any provision of the laws of the cov-
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1 ered territory governing procurement shall not apply to 

2 the Oversight Board. 

3 (d) STAFF OF FEDERAL AGENCIES.—Upon request 

4 of the Chair, the head of any Federal department or agen5 cy may detail, on a reimbursable or nonreimbursable basis, 

6 and in accordance with the Intergovernmental Personnel 

7 Act of 1970 (5 U.S.C. 3371–3375), any of the personnel 

8 of that department or agency to the Oversight Board to 

9 assist it in carrying out its duties under this Act. 

10 (e) STAFF OF TERRITORIAL GOVERNMENT.—Upon 

11 request of the Chair, the head of any department or agen12 cy of the covered territory may detail, on a reimbursable 

13 or nonreimbursable basis, any of the personnel of that de14 partment or agency to the Oversight Board to assist it 

15 in carrying out its duties under this Act. 

16 SEC. 104. POWERS OF OVERSIGHT BOARD. 

17 (a) HEARINGS AND SESSIONS.—The Oversight Board 

18 may, for the purpose of carrying out this Act, hold hear19 ings, sit and act at times and places, take testimony, and 

20 receive evidence as the Oversight Board considers appro21 priate. The Oversight Board may administer oaths or af22 firmations to witnesses appearing before it. 

23 (b) POWERS OF MEMBERS AND AGENTS.—Any mem24 ber or agent of the Oversight Board may, if authorized 
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1 by the Oversight Board, take any action that the Over2 sight Board is authorized to take by this section. 

3 (c) OBTAINING OFFICIAL DATA.— 

4 (1) FROM FEDERAL GOVERNMENT.—Notwith5 standing sections 552 (commonly known as the 

6 Freedom of Information Act), 552a (commonly 

7 known as the Privacy Act of 1974), and 552b (com8 monly known as the Government in the Sunshine 

9 Act) of title 5, United States Code, the Oversight 

10 Board may secure directly from any department or 

11 agency of the United States information necessary 

12 to enable it to carry out this Act, with the approval 

13 of the head of that department or agency. 

14 (2) FROM TERRITORIAL GOVERNMENT.—Not15 withstanding any other provision of law, the Over16 sight Board shall have the right to secure copies, 

17 whether written or electronic, of such records, docu18 ments, information, data, or metadata from the ter19 ritorial government necessary to enable the Over20 sight Board to carry out its responsibilities under 

21 this Act. At the request of the Oversight Board, the 

22 Oversight Board shall be granted direct access to 

23 such information systems, records, documents, infor24 mation, or data as will enable the Oversight Board 

25 to carry out its responsibilities under this Act. The 
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1 head of the entity of the territorial government re2 sponsible shall provide the Oversight Board with 

3 such information and assistance (including granting 

4 the Oversight Board direct access to automated or 

5 other information systems) as the Oversight Board 

6 requires under this paragraph. 

7 (d) OBTAINING CREDITOR INFORMATION.— 

8 (1) Upon request of the Oversight Board, each 

9 creditor or organized group of creditors of a covered 

10 territory or covered territorial instrumentality seek11 ing to participate in voluntary negotiations shall pro12 vide to the Oversight Board, and the Oversight 

13 Board shall make publicly available to any other 

14 participant, a statement setting forth— 

15 (A) the name and address of the creditor 

16 or of each member of an organized group of 

17 creditors; and 

18 (B) the nature and aggregate amount of 

19 claims or other economic interests held in rela20 tion to the issuer as of the later of— 

21 (i) the date the creditor acquired the 

22 claims or other economic interests or, in 

23 the case of an organized group of credi24 tors, the date the group was formed; or 
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1 (ii) the date the Oversight Board was 

2 formed. 

3 (2) For purposes of this subsection, an orga4 nized group shall mean multiple creditors that are— 

5 (A) acting in concert to advance their com6 mon interests, including, but not limited to, re7 taining legal counsel to represent such multiple 

8 entities; and 

9 (B) not composed entirely of affiliates or 

10 insiders of one another. 

11 (3) The Oversight Board may request supple12 mental statements to be filed by each creditor or or13 ganized group of creditors quarterly, or if any fact 

14 in the most recently filed statement has changed 

15 materially. 

16 (e) GIFTS, BEQUESTS, AND DEVISES.—The Over17 sight Board may accept, use, and dispose of gifts, be18 quests, or devises of services or property, both real and 

19 personal, for the purpose of aiding or facilitating the work 

20 of the Oversight Board. Gifts, bequests, or devises of 

21 money and proceeds from sales of other property received 

22 as gifts, bequests, or devises shall be deposited in such 

23 account as the Oversight Board may establish and shall 

24 be available for disbursement upon order of the Chair, 

25 consistent with the Oversight Board’s bylaws, or rules and 
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1 procedures. All gifts, bequests or devises and the identities 

2 of the donors shall be publicly disclosed by the Oversight 

3 Board within 30 days of receipt. 

4 (f) SUBPOENA POWER.— 

5 (1) IN GENERAL.—The Oversight Board may 

6 issue subpoenas requiring the attendance and testi7 mony of witnesses and the production of books, 

8 records, correspondence, memoranda, papers, docu9 ments, electronic files, metadata, tapes, and mate10 rials of any nature relating to any matter under in11 vestigation by the Oversight Board. Jurisdiction to 

12 compel the attendance of witnesses and the produc13 tion of such materials shall be governed by the stat14 ute setting forth the scope of personal jurisdiction 

15 exercised by the covered territory, or in the case of 

16 Puerto Rico, 32 L.P.R.A. App. III. R. 4. 7., as 

17 amended. 

18 (2) FAILURE TO OBEY A SUBPOENA.—If a per19 son refuses to obey a subpoena issued under para20 graph (1), the Oversight Board may apply to the 

21 court of first instance of the covered territory. Any 

22 failure to obey the order of the court may be pun23 ished by the court in accordance with civil contempt 

24 laws of the covered territory. 
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1 (3) SERVICE OF SUBPOENAS.—The subpoena of 

2 the Oversight Board shall be served in the manner 

3 provided by the rules of procedure for the courts of 

4 the covered territory, or in the case of Puerto Rico, 

5 the Rules of Civil Procedure of Puerto Rico, for sub6 poenas issued by the court of first instance of the 

7 covered territory. 

8 (g) AUTHORITY TO ENTER INTO CONTRACTS.—The 

9 Executive Director may enter into such contracts as the 

10 Executive Director considers appropriate (subject to the 

11 approval of the Chair) consistent with the Oversight 

12 Board’s bylaws, rules, and regulations to carry out the 

13 Oversight Board’s responsibilities under this Act. 

14 (h) AUTHORITY TO ENFORCE CERTAIN LAWS OF

15 THE COVERED TERRITORY.—The Oversight Board shall 

16 ensure the purposes of this Act are met, including by en17 suring the prompt enforcement of any applicable laws of 

18 the covered territory prohibiting public sector employees 

19 from participating in a strike or lockout. In the application 

20 of this subsection, with respect to Puerto Rico, the term 

21 ‘‘applicable laws’’ refers to 3 L.P.R.A. 1451q and 3 

22 L.P.R.A. 1451r, as amended. 

23 (i) VOLUNTARY AGREEMENT CERTIFICATION.— 

24 (1) IN GENERAL.—The Oversight Board shall 

25 issue a certification to a covered territory or covered 
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1 territorial instrumentality if the Oversight Board de2 termines, in its sole discretion, that such covered 

3 territory or covered territorial instrumentality, as 

4 applicable, has successfully reached a voluntary 

5 agreement with holders of its Bond Claims to re6 structure such Bond Claims— 

7 (A) except as provided in subparagraph 

8 (C), if an applicable Fiscal Plan has been cer9 tified, in a manner that provides for a sustain10 able level of debt for such covered territory or 

11 covered territorial instrumentality, as applica12 ble, and is in conformance with the applicable 

13 certified Fiscal Plan; 

14 (B) except as provided in subparagraph 

15 (C), if an applicable Fiscal Plan has not yet 

16 been certified, in a manner that provides, in the 

17 Oversight Board’s sole discretion, for a sustain18 able level of debt for such covered territory or 

19 covered territorial instrumentality; or 

20 (C) notwithstanding subparagraphs (A) 

21 and (B), if an applicable Fiscal Plan has not 

22 yet been certified and the voluntary agreement 

23 is limited solely to an extension of applicable 

24 principal maturities and interest on Bonds 

25 issued by such covered territory or covered ter-
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1 ritorial instrumentality, as applicable, for a pe2 riod of up to one year during which time no in3 terest will be paid on the Bond Claims affected 

4 by the voluntary agreement. 

5 (2) EFFECTIVENESS.—The effectiveness of any 

6 voluntary agreement referred to in paragraph (1) 

7 shall be conditioned on— 

8 (A) the Oversight Board delivering the cer9 tification described in paragraph (1); and 

10 (B) the agreement of a majority in amount 

11 of the Bond Claims of a covered territory or a 

12 covered territorial instrumentality that are to be 

13 affected by such agreement, provided, however, 

14 that such agreement is solely for purposes of 

15 serving as a Qualifying Modification pursuant 

16 to subsection 601(g) of this Act and shall not 

17 alter existing legal rights of holders of Bond 

18 Claims against such covered territory or covered 

19 territorial instrumentality that have not as20 sented to such agreement until an order approv21 ing the Qualifying Modification has been en22 tered pursuant to section 601(m)(1)(D) of this 

23 Act. 

24 (3) PREEXISTING VOLUNTARY AGREEMENTS.— 

25 Any voluntary agreement that the territorial govern-
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1 ment or any territorial instrumentality has executed 

2 before May 18, 2016, with holders of a majority in 

3 amount of Bond Claims that are to be affected by 

4 such agreement to restructure such Bond Claims 

5 shall be deemed to be in conformance with the re6 quirements of this subsection. 

7 (j) RESTRUCTURING FILINGS.— 

8 (1) IN GENERAL.—Subject to paragraph (3), 

9 before taking an action described in paragraph (2) 

10 on behalf of a debtor or potential debtor in a case 

11 under title III, the Oversight Board must certify the 

12 action. 

13 (2) ACTIONS DESCRIBED.—The actions referred 

14 to in paragraph (1) are— 

15 (A) the filing of a petition; or 

16 (B) the submission or modification of a 

17 plan of adjustment. 

18 (3) CONDITION FOR PLANS OF ADJUSTMENT.— 

19 The Oversight Board may certify a plan of adjust20 ment only if it determines, in its sole discretion, that 

21 it is consistent with the applicable certified Fiscal 

22 Plan. 

23 (k) CIVIL ACTIONS TO ENFORCE POWERS.—The 

24 Oversight Board may seek judicial enforcement of its au25 thority to carry out its responsibilities under this Act. 
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1 (l) PENALTIES.— 

2 (1) ACTS PROHIBITED.—Any officer or em3 ployee of the territorial government who prepares, 

4 presents, or certifies any information or report for 

5 the Oversight Board or any of its agents that is in6 tentionally false or misleading, or, upon learning 

7 that any such information is false or misleading, 

8 fails to immediately advise the Oversight Board or 

9 its agents thereof in writing, shall be subject to 

10 prosecution and penalties under any laws of the ter11 ritory prohibiting the provision of false information 

12 to government officials, which in the case of Puerto 

13 Rico shall include 33 L.P.R.A. 4889, as amended. 

14 (2) ADMINISTRATIVE DISCIPLINE.—In addition 

15 to any other applicable penalty, any officer or em16 ployee of the territorial government who knowingly 

17 and willfully violates paragraph (1) or takes any 

18 such action in violation of any valid order of the 

19 Oversight Board or fails or refuses to take any ac20 tion required by any such order, shall be subject to 

21 appropriate administrative discipline, including 

22 (when appropriate) suspension from duty without 

23 pay or removal from office, by order of the Gov24 ernor. 
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1 (3) REPORT BY GOVERNOR ON DISCIPLINARY

2 ACTIONS TAKEN.—In the case of a violation of para3 graph (2) by an officer or employee of the territorial 

4 government, the Governor shall immediately report 

5 to the Oversight Board all pertinent facts together 

6 with a statement of the action taken thereon. 

7 (m) ELECTRONIC REPORTING.—The Oversight 

8 Board may, in consultation with the Governor, ensure the 

9 prompt and efficient payment and administration of taxes 

10 through the adoption of electronic reporting, payment and 

11 auditing technologies. 

12 (n) ADMINISTRATIVE SUPPORT SERVICES.—Upon 

13 the request of the Oversight Board, the Administrator of 

14 General Services or other appropriate Federal agencies 

15 shall promptly provide to the Oversight Board, on a reim16 bursable or non-reimbursable basis, the administrative 

17 support services necessary for the Oversight Board to 

18 carry out its responsibilities under this Act. 

19 (o) INVESTIGATION OF DISCLOSURE AND SELLING

20 PRACTICES.—The Oversight Board may investigate the 

21 disclosure and selling practices in connection with the pur22 chase of bonds issued by a covered territory for or on be23 half of any retail investors including any underrepresenta24 tion of risk for such investors and any relationships or 

25 conflicts of interest maintained by such broker, dealer, or 
34 

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1 investment adviser is as provided in applicable laws and 

2 regulations. 

3 (p) FINDINGS OF ANY INVESTIGATION.—The Over4 sight Board shall make public the findings of any inves5 tigation referenced in subsection (o). 

6 SEC. 105. EXEMPTION FROM LIABILITY FOR CLAIMS. 

7 The Oversight Board, its members, and its employees 

8 shall not be liable for any obligation of or claim against 

9 the Oversight Board or its members or employees or the 

10 territorial government resulting from actions taken to 

11 carry out this Act. 

12 SEC. 106. TREATMENT OF ACTIONS ARISING FROM ACT. 

13 (a) JURISDICTION.—Except as provided in section 

14 104(f)(2) (relating to the issuance of an order enforcing 

15 a subpoena), and title III (relating to adjustments of 

16 debts), any action against the Oversight Board, and any 

17 action otherwise arising out of this Act, in whole or in 

18 part, shall be brought in a United States district court 

19 for the covered territory or, for any covered territory that 

20 does not have a district court, in the United States Dis21 trict Court for the District of Hawaii. 

22 (b) APPEAL.—Notwithstanding any other provision 

23 of law, any order of a United States district court that 

24 is issued pursuant to an action brought under subsection 

25 (a) shall be subject to review only pursuant to a notice 
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1 of appeal to the applicable United States Court of Ap2 peals. 

3 (c) TIMING OF RELIEF.—Except with respect to any 

4 orders entered to remedy constitutional violations, no 

5 order of any court granting declaratory or injunctive relief 

6 against the Oversight Board, including relief permitting 

7 or requiring the obligation, borrowing, or expenditure of 

8 funds, shall take effect during the pendency of the action 

9 before such court, during the time appeal may be taken, 

10 or (if appeal is taken) during the period before the court 

11 has entered its final order disposing of such action. 

12 (d) EXPEDITED CONSIDERATION.—It shall be the 

13 duty of the applicable United States District Court, the 

14 applicable United States Court of Appeals, and, as appli15 cable, the Supreme Court of the United States to advance 

16 on the docket and to expedite to the greatest possible ex17 tent the disposition of any matter brought under this Act. 

18 (e) REVIEW OF OVERSIGHT BOARD CERTIFI19 CATIONS.—There shall be no jurisdiction in any United 

20 States district court to review challenges to the Oversight 

21 Board’s certification determinations under this Act. 

22 SEC. 107. BUDGET AND FUNDING FOR OPERATION OF 

23 OVERSIGHT BOARD. 

24 (a) SUBMISSION OF BUDGET.—The Oversight Board 

25 shall submit a budget for each fiscal year during which 
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1 the Oversight Board is in operation, to the President, the 

2 House of Representatives Committee on Natural Re3 sources and the Senate Committee on Energy and Natural 

4 Resources, the Governor, and the Legislature. 

5 (b) FUNDING.—The Oversight Board shall use its 

6 powers with respect to the Territory Budget of the covered 

7 territory to ensure that sufficient funds are available to 

8 cover all expenses of the Oversight Board. 

9 (1) PERMANENT FUNDING.—Within 30 days 

10 after the date of enactment of this Act, the terri11 torial government shall designate a dedicated fund12 ing source, not subject to subsequent legislative ap13 propriations, sufficient to support the annual ex14 penses of the Oversight Board as determined in the 

15 Oversight Board’s sole and exclusive discretion. 

16 (2)(A) INITIAL FUNDING.—On the date of es17 tablishment of an Oversight Board in accordance 

18 with section 101(b) and on the 5th day of each 

19 month thereafter, the Governor of the covered terri20 tory shall transfer or cause to be transferred the 

21 greater of $2,000,000 or such amount as shall be 

22 determined by the Oversight Board pursuant to sub23 section (a) to a new account established by the terri24 torial government, which shall be available to and 

25 subject to the exclusive control of the Oversight 
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1 Board, without any legislative appropriations of the 

2 territorial government. 

3 (B) TERMINATION.—The initial funding re4 quirements under subparagraph (A) shall terminate 

5 upon the territorial government designating a dedi6 cated funding source not subject to subsequent legis7 lative appropriations under paragraph (1). 

8 (3) REMISSION OF EXCESS FUNDS.—If the 

9 Oversight Board determines in its sole discretion 

10 that any funds transferred under this subsection ex11 ceed the amounts required for the Oversight Board’s 

12 operations as established pursuant to subsection (a), 

13 any such excess funds shall be periodically remitted 

14 to the territorial government. 

15 SEC. 108. AUTONOMY OF OVERSIGHT BOARD. 

16 (a) IN GENERAL.—Neither the Governor nor the 

17 Legislature may— 

18 (1) exercise any control, supervision, oversight, 

19 or review over the Oversight Board or its activities; 

20 or 

21 (2) enact, implement, or enforce any statute, 

22 resolution, policy, or rule that would impair or de23 feat the purposes of this Act, as determined by the 

24 Oversight Board. 
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1 (b) OVERSIGHT BOARD LEGAL REPRESENTATION.— 

2 In any action brought by, on behalf of, or against the 

3 Oversight Board, the Oversight Board shall be represented 

4 by such counsel as it may hire or retain so long as the 

5 representation complies with the applicable professional 

6 rules of conduct governing conflicts of interests. 

7 SEC. 109. ETHICS. 

8 (a) CONFLICT OF INTEREST.—Notwithstanding any 

9 ethics provision governing employees of the covered terri10 tory, all members and staff of the Oversight Board shall 

11 be subject to the Federal conflict of interest requirements 

12 described in section 208 of title 18, United States Code. 

13 (b) FINANCIAL DISCLOSURE.—Notwithstanding any 

14 ethics provision governing employees of the covered terri15 tory, all members of the Oversight Board and staff des16 ignated by the Oversight Board shall be subject to disclo17 sure of their financial interests, the contents of which shall 

18 conform to the same requirements set forth in section 102 

19 of the Ethics in Government Act of 1978 (5 U.S.C. App.). 

20 TITLE II—RESPONSIBILITIES OF 

21 OVERSIGHT BOARD 

22 SEC. 201. APPROVAL OF FISCAL PLANS. 

23 (a) IN GENERAL.—As soon as practicable after all 

24 of the members and the Chair have been appointed to the 

25 Oversight Board in accordance with section 101(e) in the 
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1 fiscal year in which the Oversight Board is established, 

2 and in each fiscal year thereafter during which the Over3 sight Board is in operation, the Oversight Board shall de4 liver a notice to the Governor providing a schedule for the 

5 process of development, submission, approval, and certifi6 cation of Fiscal Plans. The notice may also set forth a 

7 schedule for revisions to any Fiscal Plan that has already 

8 been certified, which revisions must be subject to subse9 quent approval and certification by the Oversight Board. 

10 The Oversight Board shall consult with the Governor in 

11 establishing a schedule, but the Oversight Board shall re12 tain sole discretion to set or, by delivery of a subsequent 

13 notice to the Governor, change the dates of such schedule 

14 as it deems appropriate and reasonably feasible. 

15 (b) REQUIREMENTS.— 

16 (1) IN GENERAL.—A Fiscal Plan developed 

17 under this section shall, with respect to the terri18 torial government or covered territorial instrumen19 tality, provide a method to achieve fiscal responsi20 bility and access to the capital markets, and— 

21 (A) provide for estimates of revenues and 

22 expenditures in conformance with agreed ac23 counting standards and be based on— 

24 (i) applicable laws; or 
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1 (ii) specific bills that require enact2 ment in order to reasonably achieve the 

3 projections of the Fiscal Plan; 

4 (B) ensure the funding of essential public 

5 services; 

6 (C) provide adequate funding for public 

7 pension systems; 

8 (D) provide for the elimination of struc9 tural deficits; 

10 (E) for fiscal years covered by a Fiscal 

11 Plan in which a stay under titles III or IV is 

12 not effective, provide for a debt burden that is 

13 sustainable; 

14 (F) improve fiscal governance, account15 ability, and internal controls; 

16 (G) enable the achievement of fiscal tar17 gets; 

18 (H) create independent forecasts of rev19 enue for the period covered by the Fiscal Plan; 

20 (I) include a debt sustainability analysis; 

21 (J) provide for capital expenditures and in22 vestments necessary to promote economic 

23 growth; 
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1 (K) adopt appropriate recommendations 

2 submitted by the Oversight Board under section 

3 205(a); 

4 (L) include such additional information as 

5 the Oversight Board deems necessary; 

6 (M) ensure that assets, funds, or resources 

7 of a territorial instrumentality are not loaned 

8 to, transferred to, or otherwise used for the 

9 benefit of a covered territory or another covered 

10 territorial instrumentality of a covered territory, 

11 unless permitted by the constitution of the ter12 ritory, an approved plan of adjustment under 

13 title III, or a Qualifying Modification approved 

14 under title VI; and 

15 (N) respect the relative lawful priorities or 

16 lawful liens, as may be applicable, in the con17 stitution, other laws, or agreements of a covered 

18 territory or covered territorial instrumentality 

19 in effect prior to the date of enactment of this 

20 Act. 

21 (2) TERM.—A Fiscal Plan developed under this 

22 section shall cover a period of fiscal years as deter23 mined by the Oversight Board in its sole discretion 

24 but in any case a period of not less than 5 fiscal 
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1 years from the fiscal year in which it is certified by 

2 the Oversight Board. 

3 (c) DEVELOPMENT, REVIEW, APPROVAL, AND CER4 TIFICATION OF FISCAL PLANS.— 

5 (1) TIMING REQUIREMENT.—The Governor 

6 may not submit to the Legislature a Territory Budg7 et under section 202 for a fiscal year unless the 

8 Oversight Board has certified the Territory Fiscal 

9 Plan for that fiscal year in accordance with this sub10 section, unless the Oversight Board in its sole dis11 cretion waives this requirement. 

12 (2) FISCAL PLAN DEVELOPED BY GOVERNOR.— 

13 The Governor shall submit to the Oversight Board 

14 any proposed Fiscal Plan required by the Oversight 

15 Board by the time specified in the notice delivered 

16 under subsection (a). 

17 (3) REVIEW BY THE OVERSIGHT BOARD.—The 

18 Oversight Board shall review any proposed Fiscal 

19 Plan to determine whether it satisfies the require20 ments set forth in subsection (b) and, if the Over21 sight Board determines in its sole discretion that the 

22 proposed Fiscal Plan— 

23 (A) satisfies such requirements, the Over24 sight Board shall approve the proposed Fiscal 

25 Plan; or 
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1 (B) does not satisfy such requirements, the 

2 Oversight Board shall provide to the Gov3 ernor— 

4 (i) a notice of violation that includes 

5 recommendations for revisions to the appli6 cable Fiscal Plan; and 

7 (ii) an opportunity to correct the vio8 lation in accordance with subsection (d)(1). 

9 (d) REVISED FISCAL PLAN.— 

10 (1) IN GENERAL.—If the Governor receives a 

11 notice of violation under subsection (c)(3), the Gov12 ernor shall submit to the Oversight Board a revised 

13 proposed Fiscal Plan in accordance with subsection 

14 (b) by the time specified in the notice delivered 

15 under subsection (a). The Governor may submit as 

16 many revised Fiscal Plans to the Oversight Board as 

17 the schedule established in the notice delivered under 

18 subsection (a) permits. 

19 (2) DEVELOPMENT BY OVERSIGHT BOARD.—If 

20 the Governor fails to submit to the Oversight Board 

21 a Fiscal Plan that the Oversight Board determines 

22 in its sole discretion satisfies the requirements set 

23 forth in subsection (b) by the time specified in the 

24 notice delivered under subsection (a), the Oversight 

25 Board shall develop and submit to the Governor and 
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1 the Legislature a Fiscal Plan that satisfies the re2 quirements set forth in subsection (b). 

3 (e) APPROVAL AND CERTIFICATION.— 

4 (1) APPROVAL OF FISCAL PLAN DEVELOPED BY

5 GOVERNOR.—If the Oversight Board approves a Fis6 cal Plan under subsection (c)(3), it shall deliver a 

7 compliance certification for such Fiscal Plan to the 

8 Governor and the Legislature. 

9 (2) DEEMED APPROVAL OF FISCAL PLAN DE10 VELOPED BY OVERSIGHT BOARD.—If the Oversight 

11 Board develops a Fiscal Plan under subsection 

12 (d)(2), such Fiscal Plan shall be deemed approved 

13 by the Governor, and the Oversight Board shall 

14 issue a compliance certification for such Fiscal Plan 

15 to the Governor and the Legislature. 

16 (f) JOINT DEVELOPMENT OF FISCAL PLAN.—Not17 withstanding any other provision of this section, if the 

18 Governor and the Oversight Board jointly develop a Fiscal 

19 Plan for the fiscal year that meets the requirements under 

20 this section, and that the Governor and the Oversight 

21 Board certify that the fiscal plan reflects a consensus be22 tween the Governor and the Oversight Board, then such 

23 Fiscal Plan shall serve as the Fiscal Plan for the territory 

24 or territorial instrumentality for that fiscal year. 
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1 SEC. 202. APPROVAL OF BUDGETS. 

2 (a) REASONABLE SCHEDULE FOR DEVELOPMENT OF

3 BUDGETS.—As soon as practicable after all of the mem4 bers and the Chair have been appointed to the Oversight 

5 Board in the fiscal year in which the Oversight Board is 

6 established, and in each fiscal year thereafter during 

7 which the Oversight Board is in operation, the Oversight 

8 Board shall deliver a notice to the Governor and the Legis9 lature providing a schedule for developing, submitting, ap10 proving, and certifying Budgets for a period of fiscal years 

11 as determined by the Oversight Board in its sole discretion 

12 but in any case a period of not less than one fiscal year 

13 following the fiscal year in which the notice is delivered. 

14 The notice may also set forth a schedule for revisions to 

15 Budgets that have already been certified, which revisions 

16 must be subject to subsequent approval and certification 

17 by the Oversight Board. The Oversight Board shall con18 sult with the Governor and the Legislature in establishing 

19 a schedule, but the Oversight Board shall retain sole dis20 cretion to set or, by delivery of a subsequent notice to the 

21 Governor and the Legislature, change the dates of such 

22 schedule as it deems appropriate and reasonably feasible. 

23 (b) REVENUE FORECAST.—The Oversight Board 

24 shall submit to the Governor and Legislature a forecast 

25 of revenues for the period covered by the Budgets by the 

26 time specified in the notice delivered under subsection (a), 
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1 for use by the Governor in developing the Budget under 

2 subsection (c). 

3 (c) BUDGETS DEVELOPED BY GOVERNOR.— 

4 (1) GOVERNOR’S PROPOSED BUDGETS.—The 

5 Governor shall submit to the Oversight Board pro6 posed Budgets by the time specified in the notice de7 livered under subsection (a). In consultation with the 

8 Governor in accordance with the process specified in 

9 the notice delivered under subsection (a), the Over10 sight Board shall determine in its sole discretion 

11 whether each proposed Budget is compliant with the 

12 applicable Fiscal Plan and— 

13 (A) if a proposed Budget is a compliant 

14 budget, the Oversight Board shall— 

15 (i) approve the Budget; and 

16 (ii) if the Budget is a Territory Budg17 et, submit the Territory Budget to the 

18 Legislature; or 

19 (B) if the Oversight Board determines that 

20 the Budget is not a compliant budget, the Over21 sight Board shall provide to the Governor— 

22 (i) a notice of violation that includes 

23 a description of any necessary corrective 

24 action; and 
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1 (ii) an opportunity to correct the vio2 lation in accordance with paragraph (2). 

3 (2) GOVERNOR’S REVISIONS.—The Governor 

4 may correct any violations identified by the Over5 sight Board and submit a revised proposed Budget 

6 to the Oversight Board in accordance with para7 graph (1). The Governor may submit as many re8 vised Budgets to the Oversight Board as the sched9 ule established in the notice delivered under sub10 section (a) permits. If the Governor fails to develop 

11 a Budget that the Oversight Board determines is a 

12 compliant budget by the time specified in the notice 

13 delivered under subsection (a), the Oversight Board 

14 shall develop and submit to the Governor, in the 

15 case of an Instrumentality Budget, and to the Gov16 ernor and the Legislature, in the case of a Territory 

17 Budget, a revised compliant budget. 

18 (d) BUDGET APPROVAL BY LEGISLATURE.— 

19 (1) LEGISLATURE ADOPTED BUDGET.—The 

20 Legislature shall submit to the Oversight Board the 

21 Territory Budget adopted by the Legislature by the 

22 time specified in the notice delivered under sub23 section (a). The Oversight Board shall determine 

24 whether the adopted Territory Budget is a compliant 

25 budget and— 
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1 (A) if the adopted Territory Budget is a 

2 compliant budget, the Oversight Board shall 

3 issue a compliance certification for such compli4 ant budget pursuant to subsection (e); and 

5 (B) if the adopted Territory Budget is not 

6 a compliant budget, the Oversight Board shall 

7 provide to the Legislature— 

8 (i) a notice of violation that includes 

9 a description of any necessary corrective 

10 action; and 

11 (ii) an opportunity to correct the vio12 lation in accordance with paragraph (2). 

13 (2) LEGISLATURE’S REVISIONS.—The Legisla14 ture may correct any violations identified by the 

15 Oversight Board and submit a revised Territory 

16 Budget to the Oversight Board in accordance with 

17 the process established under paragraph (1) and by 

18 the time specified in the notice delivered under sub19 section (a). The Legislature may submit as many re20 vised adopted Territory Budgets to the Oversight 

21 Board as the schedule established in the notice deliv22 ered under subsection (a) permits. If the Legislature 

23 fails to adopt a Territory Budget that the Oversight 

24 Board determines is a compliant budget by the time 

25 specified in the notice delivered under subsection (a), 
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1 the Oversight Board shall develop a revised Terri2 tory Budget that is a compliant budget and submit 

3 it to the Governor and the Legislature. 

4 (e) CERTIFICATION OF BUDGETS.— 

5 (1) CERTIFICATION OF DEVELOPED AND AP6 PROVED TERRITORY BUDGETS.—If the Governor and 

7 the Legislature develop and approve a Territory 

8 Budget that is a compliant budget by the day before 

9 the first day of the fiscal year for which the Terri10 tory Budget is being developed and in accordance 

11 with the process established under subsections (c) 

12 and (d), the Oversight Board shall issue a compli13 ance certification to the Governor and the Legisla14 ture for such Territory Budget. 

15 (2) CERTIFICATION OF DEVELOPED INSTRU16 MENTALITY BUDGETS.—If the Governor develops an 

17 Instrumentality Budget that is a compliant budget 

18 by the day before the first day of the fiscal year for 

19 which the Instrumentality Budget is being developed 

20 and in accordance with the process established under 

21 subsection (c), the Oversight Board shall issue a 

22 compliance certification to the Governor for such In23 strumentality Budget. 

24 (3) DEEMED CERTIFICATION OF TERRITORY

25 BUDGETS.—If the Governor and the Legislature fail 
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1 to develop and approve a Territory Budget that is 

2 a compliant budget by the day before the first day 

3 of the fiscal year for which the Territory Budget is 

4 being developed, the Oversight Board shall submit a 

5 Budget to the Governor and the Legislature (includ6 ing any revision to the Territory Budget made by 

7 the Oversight Board pursuant to subsection (d)(2)) 

8 and such Budget shall be— 

9 (A) deemed to be approved by the Gov10 ernor and the Legislature; 

11 (B) the subject of a compliance certifi12 cation issued by the Oversight Board to the 

13 Governor and the Legislature; and 

14 (C) in full force and effect beginning on 

15 the first day of the applicable fiscal year. 

16 (4) DEEMED CERTIFICATION OF INSTRUMEN17 TALITY BUDGETS.—If the Governor fails to develop 

18 an Instrumentality Budget that is a compliant budg19 et by the day before the first day of the fiscal year 

20 for which the Instrumentality Budget is being devel21 oped, the Oversight Board shall submit an Instru22 mentality Budget to the Governor (including any re23 vision to the Instrumentality Budget made by the 

24 Oversight Board pursuant to subsection (c)(2)) and 

25 such Budget shall be— 
51 

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1 (A) deemed to be approved by the Gov2 ernor; 

3 (B) the subject of a compliance certifi4 cation issued by the Oversight Board to the 

5 Governor; and 

6 (C) in full force and effect beginning on 

7 the first day of the applicable fiscal year. 

8 (f) JOINT DEVELOPMENT OF BUDGETS.—Notwith9 standing any other provision of this section, if, in the case 

10 of a Territory Budget, the Governor, the Legislature, and 

11 the Oversight Board, or in the case of an Instrumentality 

12 Budget, the Governor and the Oversight Board, jointly de13 velop such Budget for the fiscal year that meets the re14 quirements under this section, and that the relevant par15 ties certify that such budget reflects a consensus among 

16 them, then such Budget shall serve as the Budget for the 

17 territory or territorial instrumentality for that fiscal year. 

18 SEC. 203. EFFECT OF FINDING OF NONCOMPLIANCE WITH 

19 BUDGET. 

20 (a) SUBMISSION OF REPORTS.—Not later than 15 

21 days after the last day of each quarter of a fiscal year 

22 (beginning with the fiscal year determined by the Over23 sight Board), the Governor shall submit to the Oversight 

24 Board a report, in such form as the Oversight Board may 

25 require, describing— 
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1 (1) the actual cash revenues, cash expenditures, 

2 and cash flows of the territorial government for the 

3 preceding quarter, as compared to the projected rev4 enues, expenditures, and cash flows contained in the 

5 certified Budget for such preceding quarter; and 

6 (2) any other information requested by the 

7 Oversight Board, which may include a balance sheet 

8 or a requirement that the Governor provide informa9 tion for each covered territorial instrumentality sep10 arately. 

11 (b) INITIAL ACTION BY OVERSIGHT BOARD.— 

12 (1) IN GENERAL.—If the Oversight Board de13 termines, based on reports submitted by the Gov14 ernor under subsection (a), independent audits, or 

15 such other information as the Oversight Board may 

16 obtain, that the actual quarterly revenues, expendi17 tures, or cash flows of the territorial government are 

18 not consistent with the projected revenues, expendi19 tures, or cash flows set forth in the certified Budget 

20 for such quarter, the Oversight Board shall— 

21 (A) require the territorial government to 

22 provide such additional information as the 

23 Oversight Board determines to be necessary to 

24 explain the inconsistency; and 
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1 (B) if the additional information provided 

2 under subparagraph (A) does not provide an ex3 planation for the inconsistency that the Over4 sight Board finds reasonable and appropriate, 

5 advise the territorial government to correct the 

6 inconsistency by implementing remedial action. 

7 (2) DEADLINES.—The Oversight Board shall 

8 establish the deadlines by which the territorial gov9 ernment shall meet the requirements of subpara10 graphs (A) and (B) of paragraph (1). 

11 (c) CERTIFICATION.— 

12 (1) INCONSISTENCY.—If the territorial govern13 ment fails to provide additional information under 

14 subsection (b)(1)(A), or fails to correct an inconsist15 ency under subsection (b)(1)(B), prior to the appli16 cable deadline under subsection (b)(2), the Oversight 

17 Board shall certify to the President, the House of 

18 Representatives Committee on Natural Resources, 

19 the Senate Committee on Energy and Natural Re20 sources, the Governor, and the Legislature that the 

21 territorial government is inconsistent with the appli22 cable certified Budget, and shall describe the nature 

23 and amount of the inconsistency. 

24 (2) CORRECTION.—If the Oversight Board de25 termines that the territorial government has initi-
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1 ated such measures as the Oversight Board con2 siders sufficient to correct an inconsistency certified 

3 under paragraph (1), the Oversight Board shall cer4 tify the correction to the President, the House of 

5 Representatives Committee on Natural Resources, 

6 the Senate Committee on Energy and Natural Re7 sources, the Governor, and the Legislature. 

8 (d) BUDGET REDUCTIONS BY OVERSIGHT BOARD.— 

9 If the Oversight Board determines that the Governor, in 

10 the case of any then-applicable certified Instrumentality 

11 Budgets, and the Governor and the Legislature, in the 

12 case of the then-applicable certified Territory Budget, 

13 have failed to correct an inconsistency identified by the 

14 Oversight Board under subsection (c), the Oversight 

15 Board shall— 

16 (1) with respect to the territorial government, 

17 other than covered territorial instrumentalities, 

18 make appropriate reductions in nondebt expendi19 tures to ensure that the actual quarterly revenues 

20 and expenditures for the territorial government are 

21 in compliance with the applicable certified Territory 

22 Budget or, in the case of the fiscal year in which the 

23 Oversight Board is established, the budget adopted 

24 by the Governor and the Legislature; and 
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1 (2) with respect to covered territorial instru2 mentalities at the sole discretion of the Oversight 

3 Board— 

4 (A) make reductions in nondebt expendi5 tures to ensure that the actual quarterly reve6 nues and expenses for the covered territorial in7 strumentality are in compliance with the appli8 cable certified Budget or, in the case of the fis9 cal year in which the Oversight Board is estab10 lished, the budget adopted by the Governor and 

11 the Legislature or the covered territorial instru12 mentality, as applicable; or 

13 (B)(i) institute automatic hiring freezes at 

14 the covered territorial instrumentality; and 

15 (ii) prohibit the covered territorial instru16 mentality from entering into any contract or en17 gaging in any financial or other transactions, 

18 unless the contract or transaction was pre19 viously approved by the Oversight Board. 

20 (e) TERMINATION OF BUDGET REDUCTIONS.—The 

21 Oversight Board shall cancel the reductions, hiring 

22 freezes, or prohibition on contracts and financial trans23 actions under subsection (d) if the Oversight Board deter24 mines that the territorial government or covered territorial 

25 instrumentality, as applicable, has initiated appropriate 
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1 measures to reduce expenditures or increase revenues to 

2 ensure that the territorial government or covered terri3 torial instrumentality is in compliance with the applicable 

4 certified Budget or, in the case of the fiscal year in which 

5 the Oversight Board is established, the budget adopted by 

6 the Governor and the Legislature. 

7 SEC. 204. REVIEW OF ACTIVITIES TO ENSURE COMPLIANCE 

8 WITH FISCAL PLAN. 

9 (a) SUBMISSION OF LEGISLATIVE ACTS TO OVER10 SIGHT BOARD.— 

11 (1) SUBMISSION OF ACTS.—Except to the ex12 tent that the Oversight Board may provide otherwise 

13 in its bylaws, rules, and procedures, not later than 

14 7 business days after a territorial government duly 

15 enacts any law during any fiscal year in which the 

16 Oversight Board is in operation, the Governor shall 

17 submit the law to the Oversight Board. 

18 (2) COST ESTIMATE; CERTIFICATION OF COM19 PLIANCE OR NONCOMPLIANCE.—The Governor shall 

20 include with each law submitted to the Oversight 

21 Board under paragraph (1) the following: 

22 (A) A formal estimate prepared by an ap23 propriate entity of the territorial government 

24 with expertise in budgets and financial manage-
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1 ment of the impact, if any, that the law will 

2 have on expenditures and revenues. 

3 (B) If the appropriate entity described in 

4 subparagraph (A) finds that the law is not sig5 nificantly inconsistent with the Fiscal Plan for 

6 the fiscal year, it shall issue a certification of 

7 such finding. 

8 (C) If the appropriate entity described in 

9 subparagraph (A) finds that the law is signifi10 cantly inconsistent with the Fiscal Plan for the 

11 fiscal year, it shall issue a certification of such 

12 finding, together with the entity’s reasons for 

13 such finding. 

14 (3) NOTIFICATION.—The Oversight Board shall 

15 send a notification to the Governor and the Legisla16 ture if— 

17 (A) the Governor submits a law to the 

18 Oversight Board under this subsection that is 

19 not accompanied by the estimate required under 

20 paragraph (2)(A); 

21 (B) the Governor submits a law to the 

22 Oversight Board under this subsection that is 

23 not accompanied by either a certification de24 scribed in paragraph (2)(B) or (2)(C); or 
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1 (C) the Governor submits a law to the 

2 Oversight Board under this subsection that is 

3 accompanied by a certification described in 

4 paragraph (2)(C) that the law is significantly 

5 inconsistent with the Fiscal Plan. 

6 (4) OPPORTUNITY TO RESPOND TO NOTIFICA7 TION.— 

8 (A) FAILURE TO PROVIDE ESTIMATE OR

9 CERTIFICATION.—After sending a notification 

10 to the Governor and the Legislature under 

11 paragraph (3)(A) or (3)(B) with respect to a 

12 law, the Oversight Board may direct the Gov13 ernor to provide the missing estimate or certifi14 cation (as the case may be), in accordance with 

15 such procedures as the Oversight Board may 

16 establish. 

17 (B) SUBMISSION OF CERTIFICATION OF

18 SIGNIFICANT INCONSISTENCY WITH FISCAL

19 PLAN AND BUDGET.—In accordance with such 

20 procedures as the Oversight Board may estab21 lish, after sending a notification to the Gov22 ernor and Legislature under paragraph (3)(C) 

23 that a law is significantly inconsistent with the 

24 Fiscal Plan, the Oversight Board shall direct 

25 the territorial government to— 
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1 (i) correct the law to eliminate the in2 consistency; or 

3 (ii) provide an explanation for the in4 consistency that the Oversight Board finds 

5 reasonable and appropriate. 

6 (5) FAILURE TO COMPLY.—If the territorial 

7 government fails to comply with a direction given by 

8 the Oversight Board under paragraph (4) with re9 spect to a law, the Oversight Board may take such 

10 actions as it considers necessary, consistent with this 

11 Act, to ensure that the enactment or enforcement of 

12 the law will not adversely affect the territorial gov13 ernment’s compliance with the Fiscal Plan, including 

14 preventing the enforcement or application of the law. 

15 (6) PRELIMINARY REVIEW OF PROPOSED

16 ACTS.—At the request of the Legislature, the Over17 sight Board may conduct a preliminary review of 

18 proposed legislation before the Legislature to deter19 mine whether the legislation as proposed would be 

20 consistent with the applicable Fiscal Plan under this 

21 subtitle, except that any such preliminary review 

22 shall not be binding on the Oversight Board in re23 viewing any law subsequently submitted under this 

24 subsection. 
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1 (b) EFFECT OF APPROVED FISCAL PLAN ON CON2 TRACTS, RULES, AND REGULATIONS.— 

3 (1) TRANSPARENCY IN CONTRACTING.—The 

4 Oversight Board shall work with a covered terri5 tory’s office of the comptroller or any functionally 

6 equivalent entity to promote compliance with the ap7 plicable law of any covered territory that requires 

8 agencies and instrumentalities of the territorial gov9 ernment to maintain a registry of all contracts exe10 cuted, including amendments thereto, and to remit 

11 a copy to the office of the comptroller for inclusion 

12 in a comprehensive database available to the public. 

13 With respect to Puerto Rico, the term ‘‘applicable 

14 law’’ refers to 2 L.P.R.A. 97, as amended. 

15 (2) AUTHORITY TO REVIEW CERTAIN CON16 TRACTS.—The Oversight Board may establish poli17 cies to require prior Oversight Board approval of 

18 certain contracts, including leases and contracts to 

19 a governmental entity or government-owned corpora20 tions rather than private enterprises that are pro21 posed to be executed by the territorial government, 

22 to ensure such proposed contracts promote market 

23 competition and are not inconsistent with the ap24 proved Fiscal Plan. 
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1 (3) SENSE OF CONGRESS.—It is the sense of 

2 Congress that any policies established by the Over3 sight Board pursuant to paragraph (2) should be de4 signed to make the government contracting process 

5 more effective, to increase the public’s faith in this 

6 process, to make appropriate use of the Oversight 

7 Board’s time and resources, to make the territorial 

8 government a facilitator and not a competitor to pri9 vate enterprise, and to avoid creating any additional 

10 bureaucratic obstacles to efficient contracting. 

11 (4) AUTHORITY TO REVIEW CERTAIN RULES, 

12 REGULATIONS, AND EXECUTIVE ORDERS.—The pro13 visions of this paragraph shall apply with respect to 

14 a rule, regulation, or executive order proposed to be 

15 issued by the Governor (or the head of any depart16 ment or agency of the territorial government) in the 

17 same manner as such provisions apply to a contract. 

18 (5) FAILURE TO COMPLY.—If a contract, rule, 

19 regulation, or executive order fails to comply with 

20 policies established by the Oversight Board under 

21 this subsection, the Oversight Board may take such 

22 actions as it considers necessary to ensure that such 

23 contract, rule, executive order or regulation will not 

24 adversely affect the territorial government’s compli25 ance with the Fiscal Plan, including by preventing 
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1 the execution or enforcement of the contract, rule, 

2 executive order or regulation. 

3 (c) RESTRICTIONS ON BUDGETARY ADJUSTMENTS.— 

4 (1) SUBMISSIONS OF REQUESTS TO OVERSIGHT

5 BOARD.—If the Governor submits a request to the 

6 Legislature for the reprogramming of any amounts 

7 provided in a certified Budget, the Governor shall 

8 submit such request to the Oversight Board, which 

9 shall analyze whether the proposed reprogramming 

10 is significantly inconsistent with the Budget, and 

11 submit its analysis to the Legislature as soon as 

12 practicable after receiving the request. 

13 (2) NO ACTION PERMITTED UNTIL ANALYSIS

14 RECEIVED.—The Legislature shall not adopt a re15 programming, and no officer or employee of the ter16 ritorial government may carry out any reprogram17 ming, until the Oversight Board has provided the 

18 Legislature with an analysis that certifies such re19 programming will not be inconsistent with the Fiscal 

20 Plan and Budget. 

21 (3) PROHIBITION ON ACTION UNTIL OVERSIGHT

22 BOARD IS APPOINTED.— 

23 (A) During the period after a territory be24 comes a covered territory and prior to the ap25 pointment of all members and the Chair of the 
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1 Oversight Board, such covered territory shall 

2 not enact new laws that either permit the trans3 fer of any funds or assets outside the ordinary 

4 course of business or that are inconsistent with 

5 the constitution or laws of the territory as of 

6 the date of enactment of this Act, provided that 

7 any executive or legislative action authorizing 

8 the movement of funds or assets during this 

9 time period may be subject to review and rescis10 sion by the Oversight Board upon appointment 

11 of the Oversight Board’s full membership. 

12 (B) Upon appointment of the Oversight Board’s 

13 full membership, the Oversight Board may review, 

14 and in its sole discretion, rescind, any law that— 

15 (i) was enacted during the period between, 

16 with respect to Puerto Rico, May 4, 2016; or 

17 with respect to any other territory, 45 days 

18 prior to the establishment of the Oversight 

19 Board for such territory, and the date of ap20 pointment of all members and the Chair of the 

21 Oversight Board; and 

22 (ii) alters pre-existing priorities of credi23 tors in a manner outside the ordinary course of 

24 business or inconsistent with the territory’s con25 stitution or the laws of the territory as of, in 
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1 the case of Puerto Rico, May 4, 2016, or with 

2 respect to any other territory, 45 days prior to 

3 the establishment of the Oversight Board for 

4 such territory; 

5 but such rescission shall only be to the extent that 

6 the law alters such priorities. 

7 (d) IMPLEMENTATION OF FEDERAL PROGRAMS.—In 

8 taking actions under this Act, the Oversight Board shall 

9 not exercise applicable authorities to impede territorial ac10 tions taken to— 

11 (1) comply with a court-issued consent decree 

12 or injunction, or an administrative order or settle13 ment with a Federal agency, with respect to Federal 

14 programs; 

15 (2) implement a federally authorized or feder16 ally delegated program; 

17 (3) implement territorial laws, which are con18 sistent with a certified Fiscal Plan, that execute 

19 Federal requirements and standards; or 

20 (4) preserve and maintain federally funded 

21 mass transportation assets. 

22 SEC. 205. RECOMMENDATIONS ON FINANCIAL STABILITY 

23 AND MANAGEMENT RESPONSIBILITY. 

24 (a) IN GENERAL.—The Oversight Board may at any 

25 time submit recommendations to the Governor or the Leg-
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1 islature on actions the territorial government may take to 

2 ensure compliance with the Fiscal Plan, or to otherwise 

3 promote the financial stability, economic growth, manage4 ment responsibility, and service delivery efficiency of the 

5 territorial government, including recommendations relat6 ing to— 

7 (1) the management of the territorial govern8 ment’s financial affairs, including economic fore9 casting and multiyear fiscal forecasting capabilities, 

10 information technology, placing controls on expendi11 tures for personnel, reducing benefit costs, reforming 

12 procurement practices, and placing other controls on 

13 expenditures; 

14 (2) the structural relationship of departments, 

15 agencies, and independent agencies within the terri16 torial government; 

17 (3) the modification of existing revenue struc18 tures, or the establishment of additional revenue 

19 structures; 

20 (4) the establishment of alternatives for meet21 ing obligations to pay for the pensions of territorial 

22 government employees; 

23 (5) modifications or transfers of the types of 

24 services that are the responsibility of, and are deliv25 ered by the territorial government; 
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1 (6) modifications of the types of services that 

2 are delivered by entities other than the territorial 

3 government under alternative service delivery mecha4 nisms; 

5 (7) the effects of the territory’s laws and court 

6 orders on the operations of the territorial govern7 ment; 

8 (8) the establishment of a personnel system for 

9 employees of the territorial government that is based 

10 upon employee performance standards; 

11 (9) the improvement of personnel training and 

12 proficiency, the adjustment of staffing levels, and 

13 the improvement of training and performance of 

14 management and supervisory personnel; and 

15 (10) the privatization and commercialization of 

16 entities within the territorial government. 

17 (b) RESPONSE TO RECOMMENDATIONS BY THE TER18 RITORIAL GOVERNMENT.— 

19 (1) IN GENERAL.—In the case of any rec20 ommendations submitted under subsection (a) that 

21 are within the authority of the territorial govern22 ment to adopt, not later than 90 days after receiving 

23 the recommendations, the Governor or the Legisla24 ture (whichever has the authority to adopt the rec25 ommendation) shall submit a statement to the Over-
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1 sight Board that provides notice as to whether the 

2 territorial government will adopt the recommenda3 tions. 

4 (2) IMPLEMENTATION PLAN REQUIRED FOR

5 ADOPTED RECOMMENDATIONS.—If the Governor or 

6 the Legislature (whichever is applicable) notifies the 

7 Oversight Board under paragraph (1) that the terri8 torial government will adopt any of the recommenda9 tions submitted under subsection (a), the Governor 

10 or the Legislature (whichever is applicable) shall in11 clude in the statement a written plan to implement 

12 the recommendation that includes— 

13 (A) specific performance measures to de14 termine the extent to which the territorial gov15 ernment has adopted the recommendation; and 

16 (B) a clear and specific timetable pursuant 

17 to which the territorial government will imple18 ment the recommendation. 

19 (3) EXPLANATIONS REQUIRED FOR REC20 OMMENDATIONS NOT ADOPTED.—If the Governor or 

21 the Legislature (whichever is applicable) notifies the 

22 Oversight Board under paragraph (1) that the terri23 torial government will not adopt any recommenda24 tion submitted under subsection (a) that the terri25 torial government has authority to adopt, the Gov-
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1 ernor or the Legislature shall include in the state2 ment explanations for the rejection of the rec3 ommendations, and the Governor or the Legislature 

4 shall submit such statement of explanations to the 

5 President and Congress. 

6 SEC. 206. OVERSIGHT BOARD DUTIES RELATED TO RE7 STRUCTURING. 

8 (a) REQUIREMENTS FOR RESTRUCTURING CERTIFI9 CATION.—The Oversight Board, prior to issuing a restruc10 turing certification regarding an entity (as such term is 

11 defined in section 101 of title 11, United States Code), 

12 shall determine, in its sole discretion, that— 

13 (1) the entity has made good-faith efforts to 

14 reach a consensual restructuring with creditors; 

15 (2) the entity has— 

16 (A) adopted procedures necessary to de17 liver timely audited financial statements; and 

18 (B) made public draft financial statements 

19 and other information sufficient for any inter20 ested person to make an informed decision with 

21 respect to a possible restructuring; 

22 (3) the entity is either a covered territory that 

23 has adopted a Fiscal Plan certified by the Oversight 

24 Board, a covered territorial instrumentality that is 

25 subject to a Territory Fiscal Plan certified by the 
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1 Oversight Board, or a covered territorial instrumen2 tality that has adopted an Instrumentality Fiscal 

3 Plan certified by the Oversight Board; and 

4 (4)(A) no order approving a Qualifying Modi5 fication under section 601 has been entered with re6 spect to such entity; or 

7 (B) if an order approving a Qualifying Modi8 fication has been entered with respect to such entity, 

9 the entity is unable to make its debt payments not10 withstanding the approved Qualifying Modification, 

11 in which case, all claims affected by the Qualifying 

12 Modification shall be subject to a title III case. 

13 (b) ISSUANCE OF RESTRUCTURING CERTIFI14 CATION.—The issuance of a restructuring certification 

15 under this section requires a vote of no fewer than 5 mem16 bers of the Oversight Board in the affirmative, which shall 

17 satisfy the requirement set forth in section 302(2) of this 

18 Act. 

19 SEC. 207. OVERSIGHT BOARD AUTHORITY RELATED TO 

20 DEBT ISSUANCE. 

21 For so long as the Oversight Board remains in oper22 ation, no territorial government may, without the prior ap23 proval of the Oversight Board, issue debt or guarantee, 

24 exchange, modify, repurchase, redeem, or enter into simi25 lar transactions with respect to its debt. 
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1 SEC. 208. REQUIRED REPORTS. 

2 (a) ANNUAL REPORT.—Not later than 30 days after 

3 the last day of each fiscal year, the Oversight Board shall 

4 submit a report to the President, Congress, the Governor 

5 and the Legislature, describing— 

6 (1) the progress made by the territorial govern7 ment in meeting the objectives of this Act during the 

8 fiscal year; 

9 (2) the assistance provided by the Oversight 

10 Board to the territorial government in meeting the 

11 purposes of this Act during the fiscal year; 

12 (3) recommendations to the President and Con13 gress on changes to this Act or other Federal laws, 

14 or other actions of the Federal Government, that 

15 would assist the territorial government in complying 

16 with any certified Fiscal Plan; 

17 (4) the precise manner in which funds allocated 

18 to the Oversight Board under section 107 and, as 

19 applicable, section 104(e) have been spent by the 

20 Oversight Board during the fiscal year; and 

21 (5) any other activities of the Oversight Board 

22 during the fiscal year. 

23 (b) REPORT ON DISCRETIONARY TAX ABATEMENT

24 AGREEMENTS.—Within six months of the establishment 

25 of the Oversight Board, the Governor shall submit a report 

26 to the Oversight Board documenting all existing discre-
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1 tionary tax abatement or similar tax relief agreements to 

2 which the territorial government, or any territorial instru3 mentality, is a party, provided that— 

4 (1) nothing in this Act shall be interpreted to 

5 limit the power of the territorial government or any 

6 territorial instrumentality to execute or modify dis7 cretionary tax abatement or similar tax relief agree8 ments, or to enforce compliance with the terms and 

9 conditions of any discretionary tax abatement or 

10 similar tax relief agreement, to which the territorial 

11 government or any territorial instrumentality is a 

12 party; and 

13 (2) the members and staff of the Oversight 

14 Board shall not disclose the contents of the report 

15 described in this subsection, and shall otherwise 

16 comply with all applicable territorial and Federal 

17 laws and regulations regarding the handling of con18 fidential taxpayer information. 

19 (c) QUARTERLY REPORTS OF CASH FLOW.—The 

20 Oversight Board, when feasible, shall report on the 

21 amount of cash flow available for the payment of debt 

22 service on all notes, bonds, debentures, credit agreements, 

23 or other instruments for money borrowed whose enforce24 ment is subject to a stay or moratorium hereunder, to25 gether with any variance from the amount set forth in the 
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1 debt sustainability analysis of the Fiscal Plan under sec2 tion 201(b)(1)(I). 

3 SEC. 209. TERMINATION OF OVERSIGHT BOARD. 

4 An Oversight Board shall terminate upon certifi5 cation by the Oversight Board that— 

6 (1) the applicable territorial government has 

7 adequate access to short-term and long-term credit 

8 markets at reasonable interest rates to meet the bor9 rowing needs of the territorial government; and 

10 (2) for at least 4 consecutive fiscal years— 

11 (A) the territorial government has devel12 oped its Budgets in accordance with modified 

13 accrual accounting standards; and 

14 (B) the expenditures made by the terri15 torial government during each fiscal year did 

16 not exceed the revenues of the territorial gov17 ernment during that year, as determined in ac18 cordance with modified accrual accounting 

19 standards. 

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

21 STATES. 

22 (a) IN GENERAL.—The full faith and credit of the 

23 United States is not pledged for the payment of any prin24 cipal of or interest on any bond, note, or other obligation 

25 issued by a covered territory or covered territorial instru-
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1 mentality. The United States is not responsible or liable 

2 for the payment of any principal of or interest on any 

3 bond, note, or other obligation issued by a covered terri4 tory or covered territorial instrumentality. 

5 (b) SUBJECT TO APPROPRIATIONS.—Any claim to 

6 which the United States is determined to be liable under 

7 this Act shall be subject to appropriations. 

8 (c) FUNDING.—No Federal funds shall be authorized 

9 by this Act for the payment of any liability of the territory 

10 or territorial instrumentality. 

11 SEC. 211. ANALYSIS OF PENSIONS. 

12 (a) DETERMINATION.—If the Oversight Board deter13 mines, in its sole discretion, that a pension system of the 

14 territorial government is materially underfunded, the 

15 Oversight Board shall conduct an analysis prepared by an 

16 independent actuary of such pension system to assist the 

17 Oversight Board in evaluating the fiscal and economic im18 pact of the pension cash flows. 

19 (b) PROVISIONS OF ANALYSIS.—An analysis con20 ducted under subsection (a) shall include— 

21 (1) an actuarial study of the pension liabilities 

22 and funding strategy that includes a forward looking 

23 projection of payments of at least 30 years of benefit 

24 payments and funding strategy to cover such pay25 ments; 
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1 (2) sources of funding to cover such payments; 

2 (3) a review of the existing benefits and their 

3 sustainability; and 

4 (4) a review of the system’s legal structure and 

5 operational arrangements, and any other studies of 

6 the pension system the Oversight Board shall deem 

7 necessary. 

8 (c) SUPPLEMENTARY INFORMATION.—In any case, 

9 the analysis conducted under subsection (a) shall include 

10 information regarding the fair market value and liabilities 

11 using an appropriate discount rate as determined by the 

12 Oversight Board. 

13 SEC. 212. INTERVENTION IN LITIGATION. 

14 (a) INTERVENTION.—The Oversight Board may in15 tervene in any litigation filed against the territorial gov16 ernment. 

17 (b) INJUNCTIVE RELIEF.— 

18 (1) IN GENERAL.—If the Oversight Board in19 tervenes in a litigation under subsection (a), the 

20 Oversight Board may seek injunctive relief, including 

21 a stay of litigation. 

22 (2) NO INDEPENDENT BASIS FOR RELIEF.— 

23 This section does not create an independent basis on 

24 which injunctive relief, including a stay of litigation, 

25 may be granted. 
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1 TITLE III—ADJUSTMENTS OF 

2 DEBTS 

3 SEC. 301. APPLICABILITY OF OTHER LAWS; DEFINITIONS. 

4 (a) SECTIONS APPLICABLE TO CASES UNDER THIS

5 TITLE.—Sections 101 (except as otherwise provided in 

6 this section), 102, 104, 105, 106, 107, 108, 112, 333, 

7 344, 347(b), 349, 350(b), 351, 361, 362, 364(c), 364(d), 

8 364(e), 364(f), 365, 366, 501, 502, 503, 504, 506, 

9 507(a)(2), 509, 510, 524(a)(1), 524(a)(2), 544, 545, 546, 

10 547, 548, 549(a), 549(c), 549(d), 550, 551, 552, 553, 

11 555, 556, 557, 559, 560, 561, 562, 902 (except as other12 wise provided in this section), 922, 923, 924, 925, 926, 

13 927, 928, 942, 944, 945, 946, 1102, 1103, 1109, 1111(b), 

14 1122, 1123(a)(1), 1123(a)(2), 1123(a)(3), 1123(a)(4), 

15 1123(a)(5), 1123(b), 1123(d), 1124, 1125, 1126(a), 

16 1126(b), 1126(c), 1126(e), 1126(f), 1126(g), 1127(d), 

17 1128, 1129(a)(2), 1129(a)(3), 1129(a)(6), 1129(a)(8), 

18 1129(a)(10), 1129(b)(1), 1129(b)(2)(A), 1129(b)(2)(B), 

19 1142(b), 1143, 1144, 1145, and 1146(a) of title 11, 

20 United States Code, apply in a case under this title and 

21 section 930 of title 11, United States Code, applies in a 

22 case under this title; however, section 930 shall not apply 

23 in any case during the first 120 days after the date on 

24 which such case is commenced under this title. 
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1 (b) MEANINGS OF TERMS.—A term used in a section 

2 of title 11, United States Code, made applicable in a case 

3 under this title by subsection (a), has the meaning given 

4 to the term for the purpose of the applicable section, un5 less the term is otherwise defined in this title. 

6 (c) DEFINITIONS.—In this title: 

7 (1) AFFILIATE.—The term ‘‘affiliate’’ means, in 

8 addition to the definition made applicable in a case 

9 under this title by subsection (a)— 

10 (A) for a territory, any territorial instru11 mentality; and 

12 (B) for a territorial instrumentality, the 

13 governing territory and any of the other terri14 torial instrumentalities of the territory. 

15 (2) DEBTOR.—The term ‘‘debtor’’ means the 

16 territory or covered territorial instrumentality con17 cerning which a case under this title has been com18 menced. 

19 (3) HOLDER OF A CLAIM OR INTEREST.—The 

20 term ‘‘holder of a claim or interest’’, when used in 

21 section 1126 of title 11, United States Code, made 

22 applicable in a case under this title by subsection 

23 (a)— 

24 (A) shall exclude any Issuer or Authorized 

25 Instrumentality of the Territory Government 
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1 Issuer (as defined under Title VI of this Act) 

2 or a corporation, trust or other legal entity that 

3 is controlled by the Issuer or an Authorized 

4 Territorial Instrumentality of the Territory 

5 Government Issuer, provided that the bene6 ficiaries of such claims, to the extent they are 

7 not referenced in this subparagraph, shall not 

8 be excluded, and that, for each excluded trust 

9 or other legal entity, the court shall, upon the 

10 request of any participant or beneficiary of such 

11 trust or entity, at any time after the commence12 ment of the case, order the appointment of a 

13 separate committee of creditors pursuant to 

14 section 1102(a)(2) of title 11, United States 

15 Code; and 

16 (B) with reference to Insured Bonds, shall 

17 mean the monoline insurer insuring such In18 sured Bond to the extent such insurer is grant19 ed the right to vote Insured Bonds for purposes 

20 of directing remedies or consenting to proposed 

21 amendments or modifications as provided in the 

22 applicable documents pursuant to which such 

23 Insured Bond was issued and insured. 

24 (4) INSURED BOND.—The term ‘‘Insured 

25 Bond’’ means a bond subject to a financial guar-
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1 antee or similar insurance contract, policy and/or 

2 surety issued by a monoline insurer. 

3 (5) PROPERTY OF THE ESTATE.—The term 

4 ‘‘property of the estate’’, when used in a section of 

5 title 11, United States Code, made applicable in a 

6 case under this title by subsection (a), means prop7 erty of the debtor. 

8 (6) STATE.—The term ‘‘State’’ when used in a 

9 section of title 11, United States Code, made appli10 cable in a case under this title by subsection (a) 

11 means State or territory when used in reference to 

12 the relationship of a State to the municipality of the 

13 State or the territorial instrumentality of a territory, 

14 as applicable. 

15 (7) TRUSTEE.—The term ‘‘trustee’’, when used 

16 in a section of title 11, United States Code, made 

17 applicable in a case under this title by subsection 

18 (a), means the Oversight Board, except as provided 

19 in section 926 of title 11, United States Code. The 

20 term ‘‘trustee’’ as described in this paragraph does 

21 not mean the U.S. Trustee, an official of the United 

22 States Trustee Program, which is a component of 

23 the United States Department of Justice. 

24 (d) REFERENCE TO TITLE.—Solely for purposes of 

25 this title, a reference to ‘‘this title’’, ‘‘this chapter’’, or 
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1 words of similar import in a section of title 11, United 

2 States Code, made applicable in a case under this title 

3 by subsection (a) or to ‘‘this title’’, ‘‘title 11’’, ‘‘Chapter 

4 9’’, ‘‘Chapter 11’’, ‘‘the Code’’, or words of similar import 

5 in the Federal Rules of Bankruptcy Procedure made appli6 cable in a case under this title shall be deemed to be a 

7 reference to this title. 

8 (e) SUBSTANTIALLY SIMILAR.—In determining 

9 whether claims are ‘‘substantially similar’’ for the purpose 

10 of section 1122 of title 11, United States Code, made ap11 plicable in a case under this title by subsection (a), the 

12 Oversight Board shall consider whether such claims are 

13 secured and whether such claims have priority over other 

14 claims. 

15 (f) OPERATIVE CLAUSES.—A section made applicable 

16 in a case under this title by subsection (a) that is operative 

17 if the business of the debtor is authorized to be operated 

18 is operative in a case under this title. 

19 SEC. 302. WHO MAY BE A DEBTOR. 

20 An entity may be a debtor under this title if— 

21 (1) the entity is— 

22 (A) a territory that has requested the es23 tablishment of an Oversight Board or has had 

24 an Oversight Board established for it by the 
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1 United States Congress in accordance with sec2 tion 101 of this Act; or 

3 (B) a covered territorial instrumentality of 

4 a territory described in paragraph (1)(A); 

5 (2) the Oversight Board has issued a certifi6 cation under section 206(b) of this Act for such enti7 ty; and 

8 (3) the entity desires to effect a plan to adjust 

9 its debts. 

10 SEC. 303. RESERVATION OF TERRITORIAL POWER TO CON11 TROL TERRITORY AND TERRITORIAL INSTRU12 MENTALITIES. 

13 Subject to the limitations set forth in titles I and II 

14 of this Act, this title does not limit or impair the power 

15 of a covered territory to control, by legislation or other16 wise, the territory or any territorial instrumentality there17 of in the exercise of the political or governmental powers 

18 of the territory or territorial instrumentality, including ex19 penditures for such exercise, but whether or not a case 

20 has been or can be commenced under this title— 

21 (1) a territory law prescribing a method of com22 position of indebtedness or a moratorium law, but 

23 solely to the extent that it prohibits the payment of 

24 principal or interest by an entity not described in 

25 section 109(b)(2) of title 11, United States Code, 
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1 may not bind any creditor of a covered territory or 

2 any covered territorial instrumentality thereof that 

3 does not consent to the composition or moratorium; 

4 (2) a judgment entered under a law described 

5 in paragraph (1) may not bind a creditor that does 

6 not consent to the composition; and 

7 (3) unlawful executive orders that alter, amend, 

8 or modify rights of holders of any debt of the terri9 tory or territorial instrumentality, or that divert 

10 funds from one territorial instrumentality to another 

11 or to the territory, shall be preempted by this Act. 

12 SEC. 304. PETITION AND PROCEEDINGS RELATING TO PETI13 TION. 

14 (a) COMMENCEMENT OF CASE.—A voluntary case 

15 under this title is commenced by the filing with the district 

16 court of a petition by the Oversight Board pursuant to 

17 the determination under section 206 of this Act. 

18 (b) OBJECTION TO PETITION.—After any objection 

19 to the petition, the court, after notice and a hearing, may 

20 dismiss the petition if the petition does not meet the re21 quirements of this title; however, this subsection shall not 

22 apply in any case during the first 120 days after the date 

23 on which such case is commenced under this title. 

24 (c) ORDER FOR RELIEF.—The commencement of a 

25 case under this title constitutes an order for relief. 
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1 (d) APPEAL.—The court may not, on account of an 

2 appeal from an order for relief, delay any proceeding 

3 under this title in the case in which the appeal is being 

4 taken, nor shall any court order a stay of such proceeding 

5 pending such appeal. 

6 (e) VALIDITY OF DEBT.—The reversal on appeal of 

7 a finding of jurisdiction shall not affect the validity of any 

8 debt incurred that is authorized by the court under section 

9 364(c) or 364(d) of title 11, United States Code. 

10 (f) JOINT FILING OF PETITIONS AND PLANS PER11 MITTED.—The Oversight Board, on behalf of debtors 

12 under this title, may file petitions or submit or modify 

13 plans of adjustment jointly if the debtors are affiliates; 

14 provided, however, that nothing in this title shall be con15 strued as authorizing substantive consolidation of the 

16 cases of affiliated debtors. 

17 (g) JOINT ADMINISTRATION OF AFFILIATED

18 CASES.—If the Oversight Board, on behalf of a debtor and 

19 one or more affiliates, has filed separate cases and the 

20 Oversight Board, on behalf of the debtor or one of the 

21 affiliates, files a motion to administer the cases jointly, 

22 the court may order a joint administration of the cases. 

23 (h) PUBLIC SAFETY.—This Act may not be construed 

24 to permit the discharge of obligations arising under Fed25 eral police or regulatory laws, including laws relating to 
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1 the environment, public health or safety, or territorial laws 

2 implementing such Federal legal provisions. This includes 

3 compliance obligations, requirements under consent de4 crees or judicial orders, and obligations to pay associated 

5 administrative, civil, or other penalties. 

6 (i) VOTING ON DEBT ADJUSTMENT PLANS NOT

7 STAYED.—Notwithstanding any provision in this title to 

8 the contrary, including sections of title 11, United States 

9 Code, incorporated by reference, nothing in this section 

10 shall prevent the holder of a claim from voting on or con11 senting to a proposed modification of such claim under 

12 title VI of this Act. 

13 SEC. 305. LIMITATION ON JURISDICTION AND POWERS OF 

14 COURT. 

15 Subject to the limitations set forth in titles I and II 

16 of this Act, notwithstanding any power of the court, unless 

17 the Oversight Board consents or the plan so provides, the 

18 court may not, by any stay, order, or decree, in the case 

19 or otherwise, interfere with— 

20 (1) any of the political or governmental powers 

21 of the debtor; 

22 (2) any of the property or revenues of the debt23 or; or 

24 (3) the use or enjoyment by the debtor of any 

25 income-producing property. 
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1 SEC. 306. JURISDICTION. 

2 (a) FEDERAL SUBJECT MATTER JURISDICTION.— 

3 The district courts shall have— 

4 (1) except as provided in paragraph (2), origi5 nal and exclusive jurisdiction of all cases under this 

6 title; and 

7 (2) except as provided in subsection (b), and 

8 notwithstanding any Act of Congress that confers 

9 exclusive jurisdiction on a court or courts other than 

10 the district courts, original but not exclusive juris11 diction of all civil proceedings arising under this 

12 title, or arising in or related to cases under this title. 

13 (b) PROPERTY JURISDICTION.—The district court in 

14 which a case under this title is commenced or is pending 

15 shall have exclusive jurisdiction of all property, wherever 

16 located, of the debtor as of the commencement of the case. 

17 (c) PERSONAL JURISDICTION.—The district court in 

18 which a case under this title is pending shall have personal 

19 jurisdiction over any person or entity. 

20 (d) REMOVAL, REMAND, AND TRANSFER.— 

21 (1) REMOVAL.—A party may remove any claim 

22 or cause of action in a civil action, other than a pro23 ceeding before the United States Tax Court or a 

24 civil action by a governmental unit to enforce the po25 lice or regulatory power of the governmental unit, to 

26 the district court for the district in which the civil 
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1 action is pending, if the district court has jurisdic2 tion of the claim or cause of action under this sec3 tion. 

4 (2) REMAND.—The district court to which the 

5 claim or cause of action is removed under paragraph 

6 (1) may remand the claim or cause of action on any 

7 equitable ground. An order entered under this sub8 section remanding a claim or cause of action, or a 

9 decision not to remand, is not reviewable by appeal 

10 or otherwise by the court of appeals under section 

11 158(d), 1291 or 1292 of title 28, United States 

12 Code, or by the Supreme Court of the United States 

13 under section 1254 of title 28, United States Code. 

14 (3) TRANSFER.—A district court shall transfer 

15 any civil proceeding arising under this title, or aris16 ing in or related to a case under this title, to the dis17 trict court in which the case under this title is pend18 ing. 

19 (e) APPEAL.— 

20 (1) An appeal shall be taken in the same man21 ner as appeals in civil proceedings generally are 

22 taken to the courts of appeals from the district 

23 court. 

24 (2) The court of appeals for the circuit in which 

25 a case under this title has venue pursuant to section 
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1 307 of this title shall have jurisdiction of appeals 

2 from all final decisions, judgments, orders and de3 crees entered under this title by the district court. 

4 (3) The court of appeals for the circuit in which 

5 a case under this title has venue pursuant to section 

6 307 of this title shall have jurisdiction to hear ap7 peals of interlocutory orders or decrees if— 

8 (A) the district court on its own motion or 

9 on the request of a party to the order or decree 

10 certifies that— 

11 (i) the order or decree involves a ques12 tion of law as to which there is no control13 ling decision of the court of appeals for the 

14 circuit or of the Supreme Court of the 

15 United States, or involves a matter of pub16 lic importance; 

17 (ii) the order or decree involves a 

18 question of law requiring the resolution of 

19 conflicting decisions; or 

20 (iii) an immediate appeal from the 

21 order or decree may materially advance the 

22 progress of the case or proceeding in which 

23 the appeal is taken; and 

24 (B) the court of appeals authorizes the di25 rect appeal of the order or decree. 
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1 (4) If the district court on its own motion or on 

2 the request of a party determines that a cir3 cumstance specified in clauses (i), (ii), or (iii) of 

4 paragraph (3)(A) exists, then the district court shall 

5 make the certification described in paragraph (3). 

6 (5) The parties may supplement the certifi7 cation with a short statement of the basis for the 

8 certification issued by the district court under para9 graph (3)(A). 

10 (6) Except as provided in section 304(d), an 

11 appeal of an interlocutory order or decree does not 

12 stay any proceeding of the district court from which 

13 the appeal is taken unless the district court, or the 

14 court of appeals in which the appeal is pending, 

15 issues a stay of such proceedings pending the ap16 peal. 

17 (7) Any request for a certification in respect to 

18 an interlocutory appeal of an order or decree shall 

19 be made not later than 60 days after the entry of 

20 the order or decree. 

21 (f) REALLOCATION OF COURT STAFF.—Notwith22 standing any law to the contrary, the clerk of the court 

23 in which a case is pending shall reallocate as many staff 

24 and assistants as the clerk deems necessary to ensure that 
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1 the court has adequate resources to provide for proper 

2 case management. 

3 SEC. 307. VENUE. 

4 (a) IN GENERAL.—Venue shall be proper in— 

5 (1) with respect to a territory, the district court 

6 for the territory or, for any territory that does not 

7 have a district court, the United States District 

8 Court for the District of Hawaii; and 

9 (2) with respect to a covered territorial instru10 mentality, the district court for the territory in 

11 which the covered territorial instrumentality is lo12 cated or, for any territory that does not have a dis13 trict court, the United States District Court for the 

14 District of Hawaii. 

15 (b) ALTERNATIVE VENUE.— 

16 (1) If the Oversight Board so determines in its 

17 sole discretion, then venue shall be proper in the dis18 trict court for the jurisdiction in which the Oversight 

19 Board maintains an office that is located outside the 

20 territory. 

21 (2) With respect to paragraph (1), the Over22 sight Board may consider, among other things— 

23 (A) the resources of the district court to 

24 adjudicate a case or proceeding; and 
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1 (B) the impact on witnesses who may be 

2 called in such a case or proceeding. 

3 SEC. 308. SELECTION OF PRESIDING JUDGE. 

4 (a) For cases in which the debtor is a territory, the 

5 Chief Justice of the United States shall designate a dis6 trict court judge to sit by designation to conduct the case. 

7 (b) For cases in which the debtor is not a territory, 

8 and no motion for joint administration of the debtor’s case 

9 with the case of its affiliate territory has been filed or 

10 there is no case in which the affiliate territory is a debtor, 

11 the chief judge of the court of appeals for the circuit em12 bracing the district in which the case is commenced shall 

13 designate a district court judge to conduct the case. 

14 SEC. 309. ABSTENTION. 

15 Nothing in this title prevents a district court in the 

16 interests of justice from abstaining from hearing a par17 ticular proceeding arising in or related to a case under 

18 this title. 

19 SEC. 310. APPLICABLE RULES OF PROCEDURE. 

20 The Federal Rules of Bankruptcy Procedure shall 

21 apply to a case under this title and to all civil proceedings 

22 arising in or related to cases under this title. 

23 SEC. 311. LEASES. 

24 A lease to a territory or territorial instrumentality 

25 shall not be treated as an executory contract or unexpired 
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1 lease for the purposes of section 365 or 502(b)(6) of title 

2 11, United States Code, solely by reason of the lease being 

3 subject to termination in the event the debtor fails to ap4 propriate rent. 

5 SEC. 312. FILING OF PLAN OF ADJUSTMENT. 

6 (a) EXCLUSIVITY.—Only the Oversight Board, after 

7 the issuance of a certificate pursuant to section 104(j) of 

8 this Act, may file a plan of adjustment of the debts of 

9 the debtor. 

10 (b) DEADLINE FOR FILING PLAN.—If the Oversight 

11 Board does not file a plan of adjustment with the petition, 

12 the Oversight Board shall file a plan of adjustment at the 

13 time set by the court. 

14 SEC. 313. MODIFICATION OF PLAN. 

15 The Oversight Board, after the issuance of a certifi16 cation pursuant to section 104(j) of this Act, may modify 

17 the plan at any time before confirmation, but may not 

18 modify the plan so that the plan as modified fails to meet 

19 the requirements of this title. After the Oversight Board 

20 files a modification, the plan as modified becomes the 

21 plan. 

22 SEC. 314. CONFIRMATION. 

23 (a) OBJECTION.—A special tax payer may object to 

24 confirmation of a plan. 
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1 (b) CONFIRMATION.—The court shall confirm the 

2 plan if— 

3 (1) the plan complies with the provisions of title 

4 11 of the United States Code, made applicable to a 

5 case under this title by section 301 of this Act; 

6 (2) the plan complies with the provisions of this 

7 title; 

8 (3) the debtor is not prohibited by law from 

9 taking any action necessary to carry out the plan; 

10 (4) except to the extent that the holder of a 

11 particular claim has agreed to a different treatment 

12 of such claim, the plan provides that on the effective 

13 date of the plan each holder of a claim of a kind 

14 specified in 507(a)(2) of title 11, United States 

15 Code, will receive on account of such claim cash 

16 equal to the allowed amount of such claim; 

17 (5) any legislative, regulatory, or electoral ap18 proval necessary under applicable law in order to 

19 carry out any provision of the plan has been ob20 tained, or such provision is expressly conditioned on 

21 such approval; 

22 (6) the plan is feasible and in the best interests 

23 of creditors, which shall require the court to consider 

24 whether available remedies under the non-bank25 ruptcy laws and constitution of the territory would 
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1 result in a greater recovery for the creditors than is 

2 provided by such plan; and 

3 (7) the plan is consistent with the applicable 

4 Fiscal Plan certified by the Oversight Board under 

5 title II. 

6 (c) CONFIRMATION FOR DEBTORS WITH A SINGLE

7 CLASS OF CLAIMS.—If all of the requirements of section 

8 314(b) of this title and section 1129(a) of title 11, United 

9 States Code, incorporated into this title by section 301 

10 other than sections 1129(a)(8) and 1129(a)(10) are met 

11 with respect to a plan— 

12 (1) with respect to which all claims are substan13 tially similar under section 301(e) of this title; 

14 (2) that includes only one class of claims, which 

15 claims are impaired claims; and 

16 (3) that was not accepted by such impaired 

17 class, 

18 the court shall confirm the plan notwithstanding the re19 quirements of such sections 1129(a)(8) and 1129(a)(10) 

20 of title 11, United States Code if the plan is fair and equi21 table and does not discriminate unfairly with respect to 

22 such impaired class. 

23 SEC. 315. ROLE AND CAPACITY OF OVERSIGHT BOARD. 

24 (a) ACTIONS OF OVERSIGHT BOARD.—For the pur25 poses of this title, the Oversight Board may take any ac-
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1 tion necessary on behalf of the debtor to prosecute the 

2 case of the debtor, including— 

3 (1) filing a petition under section 304 of this 

4 Act; 

5 (2) submitting or modifying a plan of adjust6 ment under sections 312 and 313; or 

7 (3) otherwise generally submitting filings in re8 lation to the case with the court. 

9 (b) REPRESENTATIVE OF DEBTOR.—The Oversight 

10 Board in a case under this title is the representative of 

11 the debtor. 

12 SEC. 316. COMPENSATION OF PROFESSIONALS. 

13 (a) After notice to the parties in interest and the 

14 United States Trustee and a hearing, the court may award 

15 to a professional person employed by the debtor (in the 

16 debtor’s sole discretion), the Oversight Board (in the 

17 Oversight Board’s sole discretion), a committee under sec18 tion 1103 of title 11, United States Code, or a trustee 

19 appointed by the court under section 926 of title 11, 

20 United States Code— 

21 (1) reasonable compensation for actual, nec22 essary services rendered by the professional person, 

23 or attorney and by any paraprofessional person em24 ployed by any such person; and 
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1 (2) reimbursement for actual, necessary ex2 penses. 

3 (b) The court may, on its own motion or on the mo4 tion of the United States Trustee or any other party in 

5 interest, award compensation that is less than the amount 

6 of compensation that is requested. 

7 (c) In determining the amount of reasonable com8 pensation to be awarded to a professional person, the 

9 court shall consider the nature, the extent, and the value 

10 of such services, taking into account all relevant factors, 

11 including— 

12 (1) the time spent on such services; 

13 (2) the rates charged for such services; 

14 (3) whether the services were necessary to the 

15 administration of, or beneficial at the time at which 

16 the service was rendered toward the completion of, 

17 a case under this chapter; 

18 (4) whether the services were performed within 

19 a reasonable amount of time commensurate with the 

20 complexity, importance, and nature of the problem, 

21 issue, or task addressed; 

22 (5) with respect to a professional person, 

23 whether the person is board certified or otherwise 

24 has demonstrated skill and experience in the restruc25 turing field; and 
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1 (6) whether the compensation is reasonable 

2 based on the customary compensation charged by 

3 comparably skilled practitioners in cases other than 

4 cases under this title or title 11, United States 

5 Code. 

6 (d) The court shall not allow compensation for— 

7 (1) unnecessary duplication of services; or 

8 (2) services that were not— 

9 (A) reasonably likely to benefit the debtor; 

10 or 

11 (B) necessary to the administration of the 

12 case. 

13 (e) The court shall reduce the amount of compensa14 tion awarded under this section by the amount of any in15 terim compensation awarded under section 317 of this 

16 title, and, if the amount of such interim compensation ex17 ceeds the amount of compensation awarded under this sec18 tion, may order the return of the excess to the debtor. 

19 (f) Any compensation awarded for the preparation of 

20 a fee application shall be based on the level and skill rea21 sonably required to prepare the application. 

22 SEC. 317. INTERIM COMPENSATION. 

23 A debtor’s attorney, or any professional person em24 ployed by the debtor (in the debtor’s sole discretion), the 

25 Oversight Board (in the Oversight Board’s sole discre-
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1 tion), a committee under section 1103 of title 11, United 

2 States Code, or a trustee appointed by the court under 

3 section 926 of title 11, United States Code, may apply 

4 to the court not more than once every 120 days after an 

5 order for relief in a case under this title, or more often 

6 if the court permits, for such compensation for services 

7 rendered before the date of such an application or reim8 bursement for expenses incurred before such date as is 

9 provided under section 316 of this title. 

10 TITLE IV—MISCELLANEOUS 

11 PROVISIONS 

12 SEC. 401. RULES OF CONSTRUCTION. 

13 Nothing in this Act is intended, or may be con14 strued— 

15 (1) to limit the authority of Congress to exer16 cise legislative authority over the territories pursu17 ant to Article IV, section 3 of the Constitution of 

18 the United States; 

19 (2) to authorize the application of section 

20 104(f) of this Act (relating to issuance of sub21 poenas) to judicial officers or employees of territory 

22 courts; 

23 (3) to alter, amend, or abrogate any provision 

24 of the Covenant To Establish a Commonwealth of 

25 the Northern Mariana Islands in Political Union 
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1 With the United States of America (48 U.S.C. 1801 

2 et seq.); or 

3 (4) to alter, amend, or abrogate the treaties of 

4 cession regarding certain islands of American Samoa 

5 (48 U.S.C. 1661). 

6 SEC. 402. RIGHT OF PUERTO RICO TO DETERMINE ITS FU7 TURE POLITICAL STATUS. 

8 Nothing in this Act shall be interpreted to restrict 

9 Puerto Rico’s right to determine its future political status, 

10 including by conducting the plebiscite as authorized by 

11 Public Law 113–76. 

12 SEC. 403. FIRST MINIMUM WAGE IN PUERTO RICO. 

13 Section 6(g) of the Fair Labor Standards Act of 

14 1938 (29 U.S.C. 206(g)) is amended by striking para15 graphs (2) through (4) and inserting the following: 

16 ‘‘(2) In lieu of the rate prescribed by subsection 

17 (a)(1), the Governor of Puerto Rico, subject to the ap18 proval of the Financial Oversight and Management Board 

19 established pursuant to section 101 of the Puerto Rico 

20 Oversight, Management, and Economic Stability Act, may 

21 designate a time period not to exceed four years during 

22 which employers in Puerto Rico may pay employees who 

23 are initially employed after the date of enactment of such 

24 Act a wage which is not less than the wage described in 

25 paragraph (1). Notwithstanding the time period des-
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1 ignated, such wage shall not continue in effect after such 

2 Board terminates in accordance with section 209 of such 

3 Act. 

4 ‘‘(3) No employer may take any action to displace 

5 employees (including partial displacements such as reduc6 tion in hours, wages, or employment benefits) for purposes 

7 of hiring individuals at the wage authorized in paragraph 

8 (1) or (2). 

9 ‘‘(4) Any employer who violates this subsection shall 

10 be considered to have violated section 15(a)(3) (29 U.S.C. 

11 215(a)(3)). 

12 ‘‘(5) This subsection shall only apply to an employee 

13 who has not attained the age of 20 years, except in the 

14 case of the wage applicable in Puerto Rico, 25 years, until 

15 such time as the Board described in paragraph (2) termi16 nates in accordance with section 209 of the Act described 

17 in such paragraph.’’. 

18 SEC. 404. APPLICATION OF REGULATION TO PUERTO RICO. 

19 (a) SPECIAL RULE.—The regulations proposed by the 

20 Secretary of Labor relating to exemptions regarding the 

21 rates of pay for executive, administrative, professional, 

22 outside sales, and computer employees, and published in 

23 a notice in the Federal Register on July 6, 2015, and any 

24 final regulations issued related to such notice, shall have 
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1 no force or effect in the Commonwealth of Puerto Rico 

2 until— 

3 (1) the Comptroller General of the United 

4 States completes the assessment and transmits the 

5 report required under subsection (b); and 

6 (2) the Secretary of Labor, taking into account 

7 the assessment and report of the Comptroller Gen8 eral, provides a written determination to Congress 

9 that applying such rule to Puerto Rico would not 

10 have a negative impact on the economy of Puerto 

11 Rico. 

12 (b) ASSESSMENT AND REPORT.—Not later than two 

13 years after the date of enactment of this Act, the Comp14 troller General shall examine the economic conditions in 

15 Puerto Rico and shall transmit a report to Congress as16 sessing the impact of applying the regulations described 

17 in subsection (a) to Puerto Rico, taking into consideration 

18 regional, metropolitan, and non-metropolitan salary and 

19 cost-of-living differences. 

20 (c) SENSE OF CONGRESS.—It is the sense of Con21 gress that— 

22 (1) the Bureau of the Census should conduct a 

23 study to determine the feasibility of expanding data 

24 collection to include Puerto Rico and the other 

25 United States territories in the Current Population 
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1 Survey, which is jointly administered by the Bureau 

2 of the Census and the Bureau of Labor Statistics, 

3 and which is the primary source of labor force sta4 tistics for the population of the United States; and 

5 (2) if necessary, the Bureau of the Census 

6 should request the funding required to conduct this 

7 feasibility study as part of its budget submission to 

8 Congress for fiscal year 2018. 

9 SEC. 405. AUTOMATIC STAY UPON ENACTMENT. 

10 (a) DEFINITIONS.—In this section: 

11 (1) LIABILITY.—The term ‘‘Liability’’ means a 

12 bond, loan, letter of credit, other borrowing title, ob13 ligation of insurance, or other financial indebtedness 

14 for borrowed money, including rights, entitlements, 

15 or obligations whether such rights, entitlements, or 

16 obligations arise from contract, statute, or any other 

17 source of law related to such a bond, loan, letter of 

18 credit, other borrowing title, obligation of insurance, 

19 or other financial indebtedness in physical or dema20 terialized form, of which— 

21 (A) the issuer, obligor, or guarantor is the 

22 Government of Puerto Rico; and 

23 (B) the date of issuance or incurrence pre24 cedes the date of enactment of this Act. 
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1 (2) LIABILITY CLAIM.—The term ‘‘Liability 

2 Claim’’ means, as it relates to a Liability— 

3 (A) right to payment, whether or not such 

4 right is reduced to judgment, liquidated, unliq5 uidated, fixed, contingent, matured, unmatured, 

6 disputed, undisputed, legal, equitable, secured, 

7 or unsecured; or 

8 (B) right to an equitable remedy for 

9 breach of performance if such breach gives rise 

10 to a right to payment, whether or not such 

11 right to an equitable remedy is reduced to judg12 ment, fixed, contingent, matured, unmatured, 

13 disputed, undisputed, secured, or unsecured. 

14 (b) IN GENERAL.—Except as provided in subsection 

15 (c) of this section, the establishment of an Oversight 

16 Board for Puerto Rico (i.e., the enactment of this Act) 

17 in accordance with section 101 operates with respect to 

18 a Liability as a stay, applicable to all entities (as such 

19 term is defined in section 101 of title 11, United States 

20 Code), of— 

21 (1) the commencement or continuation, includ22 ing the issuance or employment of process, of a judi23 cial, administrative, or other action or proceeding 

24 against the Government of Puerto Rico that was or 

25 could have been commenced before the enactment of 
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1 this Act, or to recover a Liability Claim against the 

2 Government of Puerto Rico that arose before the en3 actment of this Act; 

4 (2) the enforcement, against the Government of 

5 Puerto Rico or against property of the Government 

6 of Puerto Rico, of a judgment obtained before the 

7 enactment of this Act; 

8 (3) any act to obtain possession of property of 

9 the Government of Puerto Rico or of property from 

10 the Government of Puerto Rico or to exercise control 

11 over property of the Government of Puerto Rico; 

12 (4) any act to create, perfect, or enforce any 

13 lien against property of the Government of Puerto 

14 Rico; 

15 (5) any act to create, perfect, or enforce against 

16 property of the Government of Puerto Rico any lien 

17 to the extent that such lien secures a Liability Claim 

18 that arose before the enactment of this Act; 

19 (6) any act to collect, assess, or recover a Li20 ability Claim against the Government of Puerto Rico 

21 that arose before the enactment of this Act; and 

22 (7) the setoff of any debt owing to the Govern23 ment of Puerto Rico that arose before the enactment 

24 of this Act against any Liability Claim against the 

25 Government of Puerto Rico. 
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1 (c) STAY NOT OPERABLE.—The establishment of an 

2 Oversight Board for Puerto Rico in accordance with sec3 tion 101 does not operate as a stay— 

4 (1) solely under subsection (b)(1) of this sec5 tion, of the continuation of, including the issuance or 

6 employment of process, of a judicial, administrative, 

7 or other action or proceeding against the Govern8 ment of Puerto Rico that was commenced on or be9 fore December 18, 2015; or 

10 (2) of the commencement or continuation of an 

11 action or proceeding by a governmental unit to en12 force such governmental unit’s or organization’s po13 lice and regulatory power, including the enforcement 

14 of a judgment other than a money judgment, ob15 tained in an action or proceeding by the govern16 mental unit to enforce such governmental unit’s or 

17 organization’s police or regulatory power. 

18 (d) CONTINUATION OF STAY.—Except as provided in 

19 subsections (e), (f), and (g) the stay under subsection (b) 

20 continues until the earlier of— 

21 (1) the later of— 

22 (A) the later of— 

23 (i) February 15, 2017; or 
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1 (ii) six months after the establishment 

2 of an Oversight Board for Puerto Rico as 

3 established by section 101(b); 

4 (B) the date that is 75 days after the date 

5 in subparagraph (A) if the Oversight Board de6 livers a certification to the Governor that, in 

7 the Oversight Board’s sole discretion, an addi8 tional 75 days are needed to seek to complete 

9 a voluntary process under title VI of this Act 

10 with respect to the government of the Common11 wealth of Puerto Rico or any of its territorial 

12 instrumentalities; or 

13 (C) the date that is 60 days after the date 

14 in subparagraph (A) if the district court to 

15 which an application has been submitted under 

16 subparagraph 601(m)(1)(D) of this Act deter17 mines, in the exercise of the court’s equitable 

18 powers, that an additional 60 days are needed 

19 to complete a voluntary process under title VI 

20 of this Act with respect to the government of 

21 the Commonwealth of Puerto Rico or any of its 

22 territorial instrumentalities; or 

23 (2) with respect to the government of the Com24 monwealth of Puerto Rico or any of its territorial in25 strumentalities, the date on which a case is filed by 
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1 or on behalf of the government of the Common2 wealth of Puerto Rico or any of its territorial instru3 mentalities, as applicable, under title III. 

4 (e) JURISDICTION, RELIEF FROM STAY.— 

5 (1) The United States District Court for the 

6 District of Puerto Rico shall have original and exclu7 sive jurisdiction of any civil actions arising under or 

8 related to this section. 

9 (2) On motion of or action filed by a party in 

10 interest and after notice and a hearing, the United 

11 States District Court for the District of Puerto Rico, 

12 for cause shown, shall grant relief from the stay pro13 vided under subsection (b) of this section. 

14 (f) TERMINATION OF STAY; HEARING.—Forty-five 

15 days after a request under subsection (e)(2) for relief from 

16 the stay of any act against property of the Government 

17 of Puerto Rico under subsection (b), such stay is termi18 nated with respect to the party in interest making such 

19 request, unless the court, after notice and a hearing, or20 ders such stay continued in effect pending the conclusion 

21 of, or as a result of, a final hearing and determination 

22 under subsection (e)(2). A hearing under this subsection 

23 may be a preliminary hearing, or may be consolidated with 

24 the final hearing under subsection (e)(2). The court shall 

25 order such stay continued in effect pending the conclusion 
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1 of the final hearing under subsection (e)(2) if there is a 

2 reasonable likelihood that the party opposing relief from 

3 such stay will prevail at the conclusion of such final hear4 ing. If the hearing under this subsection is a preliminary 

5 hearing, then such final hearing shall be concluded not 

6 later than thirty days after the conclusion of such prelimi7 nary hearing, unless the thirty-day period is extended with 

8 the consent of the parties in interest or for a specific time 

9 which the court finds is required by compelling cir10 cumstances. 

11 (g) RELIEF TO PREVENT IRREPARABLE DAMAGE.— 

12 Upon request of a party in interest, the court, with or 

13 without a hearing, shall grant such relief from the stay 

14 provided under subsection (b) as is necessary to prevent 

15 irreparable damage to the interest of an entity in property, 

16 if such interest will suffer such damage before there is 

17 an opportunity for notice and a hearing under subsection 

18 (e) or (f). 

19 (h) ACT IN VIOLATION OF STAY IS VOID.—Any 

20 order, judgment, or decree entered in violation of this sec21 tion and any act taken in violation of this section is void, 

22 and shall have no force or effect, and any person found 

23 to violate this section may be liable for damages, costs, 

24 and attorneys’ fees incurred in defending any action taken 

25 in violation of this section, and the Oversight Board or 
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1 the Government of Puerto Rico may seek an order from 

2 the court enforcing the provisions of this section. 

3 (i) GOVERNMENT OF PUERTO RICO.—For purposes 

4 of this section, the term ‘‘Government of Puerto Rico’’, 

5 in addition to the definition set forth in section 5(11) of 

6 this Act, shall include— 

7 (1) the individuals, including elected and ap8 pointed officials, directors, officers of and employees 

9 acting in their official capacity on behalf of the Gov10 ernment of Puerto Rico; and 

11 (2) the Oversight Board, including the directors 

12 and officers of and employees acting in their official 

13 capacity on behalf of the Oversight Board. 

14 (j) NO DEFAULT UNDER EXISTING CONTRACTS.— 

15 (1) Notwithstanding any contractual provision 

16 or applicable law to the contrary and so long as a 

17 stay under this section is in effect, the holder of a 

18 Liability Claim or any other claim (as such term is 

19 defined in section 101 of title 11, United States 

20 Code) may not exercise or continue to exercise any 

21 remedy under a contract or applicable law in respect 

22 to the Government of Puerto Rico or any of its prop23 erty— 

24 (A) that is conditioned upon the financial 

25 condition of, or the commencement of a restruc-
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1 turing, insolvency, bankruptcy, or other pro2 ceeding (or a similar or analogous process) by, 

3 the Government of Puerto Rico, including a de4 fault or an event of default thereunder; or 

5 (B) with respect to Liability Claims— 

6 (i) for the non-payment of principal or 

7 interest; or 

8 (ii) for the breach of any condition or 

9 covenant. 

10 (2) The term ‘‘remedy’’ as used in paragraph 

11 (1) shall be interpreted broadly, and shall include 

12 any right existing in law or contract, including any 

13 right to— 

14 (A) setoff; 

15 (B) apply or appropriate funds; 

16 (C) seek the appointment of a custodian 

17 (as such term is defined in section 101(11) of 

18 title 11, United States Code); 

19 (D) seek to raise rates; or 

20 (E) exercise control over property of the 

21 Government of Puerto Rico. 

22 (3) Notwithstanding any contractual provision 

23 or applicable law to the contrary and so long as a 

24 stay under this section is in effect, a contract to 

25 which the Government of Puerto Rico is a party may 
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1 not be terminated or modified, and any right or obli2 gation under such contract may not be terminated 

3 or modified, solely because of a provision in such 

4 contract is conditioned on— 

5 (A) the insolvency or financial condition of 

6 the Government of Puerto Rico at any time 

7 prior to the enactment of this Act; 

8 (B) the adoption of a resolution or estab9 lishment of an Oversight Board pursuant to 

10 section 101 of this Act; or 

11 (C) a default under a separate contract 

12 that is due to, triggered by, or a result of the 

13 occurrence of the events or matters in para14 graph (1)(B). 

15 (4) Notwithstanding any contractual provision 

16 to the contrary and so long as a stay under this sec17 tion is in effect, a counterparty to a contract with 

18 the Government of Puerto Rico for the provision of 

19 goods and services shall, unless the Government of 

20 Puerto Rico agrees to the contrary in writing, con21 tinue to perform all obligations under, and comply 

22 with the terms of, such contract, provided that the 

23 Government of Puerto Rico is not in default under 

24 such contract other than as a result of a condition 

25 specified in paragraph (3). 
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1 (k) EFFECT.—This section does not discharge an ob2 ligation of the Government of Puerto Rico or release, in3 validate, or impair any security interest or lien securing 

4 such obligation. This section does not impair or affect the 

5 implementation of any restructuring support agreement 

6 executed by the Government of Puerto Rico to be imple7 mented pursuant to Puerto Rico law specifically enacted 

8 for that purpose prior to the enactment of this Act or the 

9 obligation of the Government of Puerto Rico to proceed 

10 in good faith as set forth in any such agreement. 

11 (l) PAYMENTS ON LIABILITIES.—Nothing in this sec12 tion shall be construed to prohibit the Government of 

13 Puerto Rico from making any payment on any Liability 

14 when such payment becomes due during the term of the 

15 stay, and to the extent the Oversight Board, in its sole 

16 discretion, determines it is feasible, the Government of 

17 Puerto Rico shall make interest payments on outstanding 

18 indebtedness when such payments become due during the 

19 length of the stay. 

20 (m) FINDINGS.—Congress finds the following: 

21 (1) A combination of severe economic decline, 

22 and, at times, accumulated operating deficits, lack of 

23 financial transparency, management inefficiencies, 

24 and excessive borrowing has created a fiscal emer25 gency in Puerto Rico. 
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1 (2) As a result of its fiscal emergency, the Gov2 ernment of Puerto Rico has been unable to provide 

3 its citizens with effective services. 

4 (3) The current fiscal emergency has also af5 fected the long-term economic stability of Puerto 

6 Rico by contributing to the accelerated outmigration 

7 of residents and businesses. 

8 (4) A comprehensive approach to fiscal, man9 agement, and structural problems and adjustments 

10 that exempts no part of the Government of Puerto 

11 Rico is necessary, involving independent oversight 

12 and a Federal statutory authority for the Govern13 ment of Puerto Rico to restructure debts in a fair 

14 and orderly process. 

15 (5) Additionally, an immediate—but tem16 porary—stay is essential to stabilize the region for 

17 the purposes of resolving this territorial crisis. 

18 (A) The stay advances the best interests 

19 common to all stakeholders, including but not 

20 limited to a functioning independent Oversight 

21 Board created pursuant to this Act to deter22 mine whether to appear or intervene on behalf 

23 of the Government of Puerto Rico in any litiga24 tion that may have been commenced prior to 

25 the effectiveness or upon expiration of the stay. 
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1 (B) The stay is limited in nature and nar2 rowly tailored to achieve the purposes of this 

3 Act, including to ensure all creditors have a fair 

4 opportunity to consensually renegotiate terms of 

5 repayment based on accurate financial informa6 tion that is reviewed by an independent author7 ity or, at a minimum, receive a recovery from 

8 the Government of Puerto Rico equal to their 

9 best possible outcome absent the provisions of 

10 this Act. 

11 (6) Finally, the ability of the Government of 

12 Puerto Rico to obtain funds from capital markets in 

13 the future will be severely diminished without con14 gressional action to restore its financial account15 ability and stability. 

16 (n) PURPOSES.—The purposes of this section are 

17 to— 

18 (1) provide the Government of Puerto Rico with 

19 the resources and the tools it needs to address an 

20 immediate existing and imminent crisis; 

21 (2) allow the Government of Puerto Rico a lim22 ited period of time during which it can focus its re23 sources on negotiating a voluntary resolution with 

24 its creditors instead of defending numerous, costly 

25 creditor lawsuits; 
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1 (3) provide an oversight mechanism to assist 

2 the Government of Puerto Rico in reforming its fis3 cal governance and support the implementation of 

4 potential debt restructuring; 

5 (4) make available a Federal restructuring au6 thority, if necessary, to allow for an orderly adjust7 ment of all of the Government of Puerto Rico’s li8 abilities; and 

9 (5) benefit the lives of 3.5 million American 

10 citizens living in Puerto Rico by encouraging the 

11 Government of Puerto Rico to resolve its long12 standing fiscal governance issues and return to eco13 nomic growth. 

14 (o) VOTING ON VOLUNTARY AGREEMENTS NOT

15 STAYED.—Notwithstanding any provision in this section 

16 to the contrary, nothing in this section shall prevent the 

17 holder of a Liability Claim from voting on or consenting 

18 to a proposed modification of such Liability Claim under 

19 title VI of this Act. 

20 SEC. 406. PURCHASES BY TERRITORY GOVERNMENTS. 

21 The text of section 302 of the Omnibus Insular Areas 

22 Act of 1992 (48 U.S.C. 1469e), is amended to read as 

23 follows: ‘‘The Governments of the Commonwealth of Puer24 to Rico, Guam, American Samoa, the Commonwealth of 

25 the Northern Mariana Islands, and the United States Vir-
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1 gin Islands are authorized to make purchases through the 

2 General Services Administration.’’. 

3 SEC. 407. PROTECTION FROM INTER-DEBTOR TRANSFERS. 

4 (a) PROTECTION OF CREDITORS.—While an Over5 sight Board for Puerto Rico is in existence, if any property 

6 of any territorial instrumentality of Puerto Rico is trans7 ferred in violation of applicable law under which any cred8 itor has a valid pledge of, security interest in, or lien on 

9 such property, or which deprives any such territorial in10 strumentality of property in violation of applicable law as11 suring the transfer of such property to such territorial in12 strumentality for the benefit of its creditors, then the 

13 transferee shall be liable for the value of such property. 

14 (b) ENFORCEABILITY.—A creditor may enforce 

15 rights under this section by bringing an action in the 

16 United States District Court for the District of Puerto 

17 Rico after the expiration or lifting of the stay of section 

18 405, unless a stay under title III is in effect. 

19 SEC. 408. GAO REPORT ON SMALL BUSINESS ADMINISTRA20 TION PROGRAMS IN PUERTO RICO. 

21 Section 15 of the Small Business Act (15 U.S.C. 644) 

22 is amended by adding at the end the following new sub23 section: 

24 ‘‘(t) GAO REPORT ON SMALL BUSINESS ADMINIS25 TRATION PROGRAMS IN PUERTO RICO.—Not later than 
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1 one year after the date of enactment of this subsection, 

2 the Comptroller General of the United States shall submit 

3 to the Committee on Small Business of the House of Rep4 resentatives and the Committee on Small Business and 

5 Entrepreneurship of the Senate a report on the application 

6 and utilization of contracting activities of the Administra7 tion (including contracting activities relating to HUBZone 

8 small business concerns) in Puerto Rico. The report shall 

9 also identify any provisions of Federal law that may create 

10 an obstacle to the efficient implementation of such con11 tracting activities.’’. 

12 SEC. 409. CONGRESSIONAL TASK FORCE ON ECONOMIC 

13 GROWTH IN PUERTO RICO. 

14 (a) ESTABLISHMENT.—There is established within 

15 the legislative branch a Congressional Task Force on Eco16 nomic Growth in Puerto Rico (hereinafter referred to as 

17 the ‘‘Task Force’’). 

18 (b) MEMBERSHIP.—The Task Force shall be com19 posed of eight members as follows: 

20 (1) One member of the House of Representa21 tives, who shall be appointed by the Speaker of the 

22 House of Representatives, in coordination with the 

23 Chairman of the Committee on Natural Resources of 

24 the House of Representatives. 
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1 (2) One member of the House of Representa2 tives, who shall be appointed by the Speaker of the 

3 House of Representatives, in coordination with the 

4 Chairman of the Committee on Ways and Means of 

5 the House of Representatives. 

6 (3) One member of the House of Representa7 tives, who shall be appointed by the Minority Leader 

8 of the House of Representatives, in coordination 

9 with the ranking minority member of the Committee 

10 on Natural Resources of the House of Representa11 tives. 

12 (4) One member of the House of Representa13 tives, who shall be appointed by the Minority Leader 

14 of the House of Representatives, in coordination 

15 with the ranking minority member of the Committee 

16 on Ways and Means of the House of Representa17 tives. 

18 (5) One member of the Senate, who shall be ap19 pointed by the Majority Leader of the Senate, in co20 ordination with the Chairman of the Committee on 

21 Energy and Natural Resources of the Senate. 

22 (6) One member of the Senate, who shall be ap23 pointed by the Majority Leader of the Senate, in co24 ordination with the Chairman of the Committee on 

25 Finance of the Senate. 
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1 (7) One member of the Senate, who shall be ap2 pointed by the Minority Leader of the Senate, in co3 ordination with the ranking minority member of the 

4 Committee on Energy and Natural Resources of the 

5 Senate. 

6 (8) One member of the Senate, who shall be ap7 pointed by the Minority Leader of the Senate, in co8 ordination with the ranking minority member of the 

9 Committee on Finance of the Senate. 

10 (c) DEADLINE FOR APPOINTMENT.—All appoint11 ments to the Task Force shall be made not later than 15 

12 days after the date of enactment of this Act. 

13 (d) CHAIR.—The Speaker shall designate one Mem14 ber to serve as chair of the Task Force. 

15 (e) VACANCIES.—Any vacancy in the Task Force 

16 shall be filled in the same manner as the original appoint17 ment. 

18 (f) STATUS UPDATE.—Between September 1, 2016, 

19 and September 15, 2016, the Task Force shall provide a 

20 status update to the House and Senate that includes— 

21 (1) information the Task Force has collected; 

22 and 

23 (2) a discussion on matters the chairman of the 

24 Task Force deems urgent for consideration by Con25 gress. 
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1 (g) REPORT.—Not later than December 31, 2016, 

2 the Task Force shall issue a report of its findings to the 

3 House and Senate regarding— 

4 (1) impediments in current Federal law and 

5 programs to economic growth in Puerto Rico includ6 ing equitable access to Federal health care pro7 grams; 

8 (2) recommended changes to Federal law and 

9 programs that, if adopted, would serve to spur sus10 tainable long-term economic growth, job creation, re11 duce child poverty, and attract investment in Puerto 

12 Rico; 

13 (3) the economic effect of Administrative Order 

14 No. 346 of the Department of Health of the Com15 monwealth of Puerto Rico (relating to natural prod16 ucts, natural supplements, and dietary supplements) 

17 or any successor or substantially similar order, rule, 

18 or guidance of the Commonwealth of Puerto Rico; 

19 and 

20 (4) additional information the Task Force 

21 deems appropriate. 

22 (h) CONSENSUS VIEWS.—To the greatest extent 

23 practicable, the report issued under subsection (f) shall 

24 reflect the shared views of all eight Members, except that 

25 the report may contain dissenting views. 
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1 (i) HEARINGS AND SESSIONS.—The Task Force may, 

2 for the purpose of carrying out this section, hold hearings, 

3 sit and act at times and places, take testimony, and re4 ceive evidence as the Task Force considers appropriate. 

5 If the Task Force holds hearings, at least one such hear6 ing must be held in Puerto Rico. 

7 (j) STAKEHOLDER PARTICIPATION.—In carrying out 

8 its duties, the Task Force shall consult with the Puerto 

9 Rico Legislative Assembly, the Puerto Rico Department 

10 of Economic Development and Commerce, and the private 

11 sector of Puerto Rico. 

12 (k) RESOURCES.—The Task Force shall carry out its 

13 duties by utilizing existing facilities, services, and staff of 

14 the House of Representatives and Senate, except that no 

15 additional funds are authorized to be appropriated to 

16 carry out this section. 

17 (l) TERMINATION.—The Task Force shall terminate 

18 upon issuing the report required under subsection (f). 

19 SEC. 410. REPORT. 

20 Not later than 18 months after the date of the enact21 ment of this Act, the Comptroller General shall submit 

22 a report to the Committee on Natural Resources of the 

23 House of Representatives and the Committee on Energy 

24 and Natural Resources of the Senate describing— 
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1 (1) the conditions which led to the level of debt, 

2 which should be analyzed, per capita and based upon 

3 overall economic activity; 

4 (2) how actions of the territorial government 

5 improved or impaired the territory’s financial condi6 tions; and 

7 (3) recommendations on non-fiscal actions, or 

8 policies that would not imperil America’s homeland 

9 and national security, that could be taken by Con10 gress or the Administration to avert future indebted11 ness of territories, while respecting sovereignty and 

12 constitutional parameters. 

13 SEC. 411. REPORT ON TERRITORIAL DEBT. 

14 (a) REPORT REQUIRED.—Not later than one year 

15 after the date of the enactment of this Act, and thereafter 

16 not less than once every two years, the Comptroller Gen17 eral of the United States shall submit to Congress a report 

18 on the public debt of each territory, including— 

19 (1) the historical levels of each territory’s public 

20 debt, current amount and composition of each terri21 tory’s public debt, and future projections of each ter22 ritory’s public debt; 

23 (2) the historical levels of each territory’s rev24 enue, current amount and composition of each terri-
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1 tory’s revenue, and future projections of each terri2 tory’s revenue; 

3 (3) the drivers and composition of each terri4 tory’s public debt; 

5 (4) the effect of Federal laws, mandates, rules, 

6 and regulations on each territory’s public debt; and 

7 (5) the ability of each territory to repay it’s 

8 public debt. 

9 (b) MATERIALS.—The government of each territory 

10 shall make available to the Comptroller General of the 

11 United States all materials necessary to carry out this sec12 tion. 

13 SEC. 412. EXPANSION OF HUBZONES IN PUERTO RICO. 

14 (a) IN GENERAL.— 

15 (1) Section 3(p)(4)(A) of the Small Business 

16 Act (15 U.S.C. 632(p)(4)(A)) is amended to read as 

17 follows: 

18 ‘‘(A) QUALIFIED CENSUS TRACT.— 

19 ‘‘(i) IN GENERAL.—The term ‘quali20 fied census tract’ has the meaning given 

21 that term in section 42(d)(5)(B)(ii) of the 

22 Internal Revenue Code of 1986. 

23 ‘‘(ii) EXCEPTION.—For any metro24 politan statistical area in the Common25 wealth of Puerto Rico, the term ‘qualified 
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1 census tract’ has the meaning given that 

2 term in section 42(d)(5)(B)(ii) of the In3 ternal Revenue Code of 1986 as applied 

4 without regard to subclause (II) of such 

5 section, except that this clause shall only 

6 apply— 

7 ‘‘(I) 10 years after the date that 

8 the Administrator implements this 

9 clause, or 

10 ‘‘(II) the date on which the Fi11 nancial Oversight and Management 

12 Board for the Commonwealth of Puer13 to Rico created by the Puerto Rico 

14 Oversight, Management, and Eco15 nomic Stability Act ceases to exist, 

16 whichever event occurs first.’’. 

17 (2) REGULATIONS.—The Administrator of the 

18 Small Business Administration shall issue regula19 tions to implement the amendment made by para20 graph (1) not later than 90 days after the date of 

21 the enactment of this Act. 

22 (b) IMPROVING OVERSIGHT.— 

23 (1) GUIDANCE.—Not later than 270 days after 

24 the date of the enactment of this Act, the Adminis25 trator of the Small Business Administration shall 
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1 develop and implement criteria and guidance on 

2 using a risk-based approach to requesting and 

3 verifying information from entities applying to be 

4 designated or recertified as qualified HUBZone 

5 small business concerns (as defined in section 

6 3(p)(5) of the Small Business Act (15 U.S.C. 

7 632(p)(5))). 

8 (2) ASSESSMENT.—Not later 1 year after the 

9 date on which the criteria and guidance described in 

10 paragraph (1) is implemented, the Comptroller Gen11 eral of the United States shall begin an assessment 

12 of such criteria and guidance. Not later than 6 

13 months after beginning such an assessment, the 

14 Comptroller General shall submit a report to the 

15 Committee on Small Business and Entrepreneurship 

16 of the Senate and the Committee on Small Business 

17 of the House of Representatives that includes— 

18 (A) an assessment of the criteria and guid19 ance issued by the Administrator of the Small 

20 Business Administration in accordance with 

21 paragraph (1); 

22 (B) an assessment of the implementation 

23 of the criteria and guidance issued by issued by 

24 the Administrator of the Small Business Ad25 ministration in accordance with paragraph (1); 
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1 (C) an assessment as to whether these 

2 measures have successfully ensured that only 

3 qualified HUBZone small business concerns are 

4 participating in the HUBZone program under 

5 section 31 of the Small Business Act (15 

6 U.S.C. 657a); 

7 (D) an assessment as to whether the re8 forms made by the criteria and guidance imple9 mented under paragraph (1) have resulted in 

10 job creation in the Commonwealth of Puerto 

11 Rico; and 

12 (E) recommendations on how to improve 

13 controls in the HUBZone program. 

14 SEC. 413. DETERMINATION ON DEBT. 

15 Nothing in this Act shall be interpreted to restrict— 

16 (1) the ability of the Puerto Rico Commission 

17 for the Comprehensive Audit of the Public Credit to 

18 file its reports; or 

19 (2) the review and consideration of the Puerto 

20 Rico Commission’s findings by Puerto Rico’s govern21 ment or an Oversight Board for Puerto Rico estab22 lished under section 101. 
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1 TITLE V—PUERTO RICO INFRA2 STRUCTURE REVITALIZATION 

3 SEC. 501. DEFINITIONS. 

4 In this title: 

5 (1) ACT 76.—The term ‘‘Act 76’’ means Puerto 

6 Rico Act 76–2000 (3 L.P.R.A. 1931 et seq.), ap7 proved on May 5, 2000, as amended. 

8 (2) CRITICAL PROJECT.—The term ‘‘Critical 

9 Project’’ means a project identified under the provi10 sions of this title and intimately related to address11 ing an emergency whose approval, consideration, 

12 permitting, and implementation shall be expedited 

13 and streamlined according to the statutory process 

14 provided by Act 76, or otherwise adopted pursuant 

15 to this title. 

16 (3) ENERGY COMMISSION OF PUERTO RICO.— 

17 The term ‘‘Energy Commission of Puerto Rico’’ 

18 means the Puerto Rico Energy Commission as es19 tablished by Subtitle B of Puerto Rico Act 57–2014. 

20 (4) ENERGY PROJECTS.—The term ‘‘Energy 

21 Projects’’ means those projects addressing the gen22 eration, distribution, or transmission of energy. 

23 (5) EMERGENCY.—The term ‘‘emergency’’ 

24 means any event or grave problem of deterioration 

25 in the physical infrastructure for the rendering of 
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1 essential services to the people, or that endangers 

2 the life, public health, or safety of the population or 

3 of a sensitive ecosystem, or as otherwise defined by 

4 section 1 of Act 76 (3 L.P.R.A. 1931). This shall in5 clude problems in the physical infrastructure for en6 ergy, water, sewer, solid waste, highways or roads, 

7 ports, telecommunications, and other similar infra8 structure. 

9 (6) ENVIRONMENTAL QUALITY BOARD.—The 

10 term ‘‘Environmental Quality Board’’ means the 

11 Puerto Rico Environmental Quality Board, a board 

12 within the executive branch of the Government of 

13 Puerto Rico as established by section 7 of Puerto 

14 Rico Act 416–2004 (12 L.P.R.A. 8002a). 

15 (7) EXPEDITED PERMITTING PROCESS.—The 

16 term ‘‘Expedited Permitting Process’’ means a Puer17 to Rico Agency’s alternate procedures, conditions, 

18 and terms mirroring those established under Act 76 

19 (3 L.P.R.A. 1932) and pursuant to this title shall 

20 not apply to any Federal law, statute, or require21 ment. 

22 (8) GOVERNOR.—The term ‘‘Governor’’ means 

23 the Governor of Puerto Rico. 

24 (9) INTERAGENCY ENVIRONMENTAL SUB25 COMMITTEE.—The term ‘‘Interagency Environ-
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1 mental Subcommittee’’ means the Interagency Sub2 committee on Expedited Environmental Regulations 

3 as further described by section 504. 

4 (10) LEGISLATURE.—The term ‘‘Legislature’’ 

5 means the Legislature of Puerto Rico. 

6 (11) PLANNING BOARD.—The term ‘‘Planning 

7 Board’’ means the Puerto Rico Planning Board, a 

8 board within the executive branch of the Govern9 ment of Puerto Rico established by Puerto Rico Act 

10 75–1975 (23 L.P.R.A. 62 et seq.). 

11 (12) PROJECT SPONSOR.—The term ‘‘Project 

12 Sponsor’’ means a Puerto Rico Agency or private 

13 party proposing the development of an existing, on14 going, or new infrastructure project or Energy 

15 Project. 

16 (13) PUERTO RICO AGENCY OR AGENCIES.— 

17 The terms ‘‘Puerto Rico Agency’’ or ‘‘Puerto Rico 

18 Agencies’’ means any board, body, board of exam19 iners, public corporation, commission, independent 

20 office, division, administration, bureau, department, 

21 authority, official, person, entity, municipality, or 

22 any instrumentality of Puerto Rico, or an adminis23 trative body authorized by law to perform duties of 

24 regulating, investigating, or that may issue a deci25 sion, or with the power to issue licenses, certificates, 
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1 permits, concessions, accreditations, privileges, fran2 chises, except the Senate and the House of Rep3 resentatives of the Legislature and the judicial 

4 branch. 

5 (14) PUERTO RICO ELECTRIC POWER AUTHOR6 ITY.—The term ‘‘Puerto Rico Electric Power Au7 thority’’ means the Puerto Rico Electric Power Au8 thority established by Puerto Rico Act 83–1941. 

9 SEC. 502. POSITION OF REVITALIZATION COORDINATOR. 

10 (a) ESTABLISHMENT.—There is established, under 

11 the Oversight Board, the position of the Revitalization Co12 ordinator. 

13 (b) APPOINTMENT.— 

14 (1) IN GENERAL.—The Revitalization Coordi15 nator shall be appointed by the Governor as follows: 

16 (A) Prior to the appointment of the Revi17 talization Coordinator and within 60 days of 

18 the appointment of the full membership of the 

19 Oversight Board, the Oversight Board shall 

20 submit to the Governor no less than three 

21 nominees for appointment. 

22 (B) In consultation with the Oversight 

23 Board, not later than 10 days after receiving 

24 the nominations under subparagraph (A), the 

25 Governor shall appoint one of the nominees as 
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1 the Revitalization Coordinator. Such appoint2 ment shall be effective immediately. 

3 (C) If the Governor fails to select a Revi4 talization Coordinator, the Oversight Board 

5 shall, by majority vote, appoint a Revitalization 

6 Coordinator from the list of nominees provided 

7 under paragraph (A). 

8 (2) QUALIFICATIONS.—In selecting nominees 

9 under paragraph (1)(A), the Oversight Board shall 

10 only nominate persons who— 

11 (A) have substantial knowledge and exper12 tise in the planning, predevelopment, financing, 

13 development, operations, engineering, or market 

14 participation of infrastructure projects, pro15 vided that stronger consideration may be given 

16 to candidates who have experience with Energy 

17 Projects and the laws and regulations of Puerto 

18 Rico that may be subject to an Expedited Per19 mitting Process; 

20 (B) does not currently provide goods or 

21 services to the government of Puerto Rico (and, 

22 as applicable, is not the spouse, parent, child, 

23 or sibling of a person who provides or has pro24 vided goods and services to the government of 
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1 Puerto Rico in the preceding 3 calendar years); 

2 and 

3 (C) shall not be an officer, employee of, or 

4 former officer or employee of the government of 

5 Puerto Rico in the preceding 3 calendar years. 

6 (3) COMPENSATION.—The Revitalization Coor7 dinator shall be compensated at an annual rate de8 termined by the Oversight Board sufficient in the 

9 judgment of the Oversight Board to obtain the serv10 ices of a person with the skills and experience re11 quired to discharge the duties of the position, but 

12 such compensation shall not exceed the annual sal13 ary of the Executive Director. 

14 (c) ASSIGNMENT OF PERSONNEL.—The Executive 

15 Director of the Oversight Board may assign Oversight 

16 Board personnel to assist the Revitalization Coordinator. 

17 (d) REMOVAL.— 

18 (1) IN GENERAL.—The Revitalization Coordi19 nator may be removed for any reason, in the Over20 sight Board’s discretion. 

21 (2) TERMINATION OF POSITION.—Upon the ter22 mination of the Oversight Board pursuant to section 

23 209 of this Act, the position of the Revitalization 

24 Coordinator shall terminate. 
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1 SEC. 503. CRITICAL PROJECTS. 

2 (a) IDENTIFICATION OF PROJECTS.— 

3 (1) PROJECT SUBMISSION.—Any Project Spon4 sor may submit, so long as the Oversight Board is 

5 in operation, any existing, ongoing, or proposed 

6 project to the Revitalization Coordinator. The Revi7 talization Coordinator shall require such submission 

8 to include— 

9 (A) the impact the project will have on an 

10 emergency; 

11 (B) the availability of immediate private 

12 capital or other funds, including loan guaran13 tees, loans, or grants to implement, operate, or 

14 maintain the project; 

15 (C) the cost of the project and amount of 

16 Puerto Rico government funds, if any, nec17 essary to complete and maintain the project; 

18 (D) the environmental and economic bene19 fits provided by the project, including the num20 ber of jobs to be created that will be held by 

21 residents of Puerto Rico and the expected eco22 nomic impact, including the impact on rate23 payers, if applicable; 

24 (E) the status of the project if it is exist25 ing or ongoing; and 
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1 (F) in addition to the requirements found 

2 in subparagraphs (A) through (E), the Revital3 ization Coordinator may require such submis4 sion to include any or all of the following cri5 teria that assess how the project will— 

6 (i) reduce reliance on oil for electric 

7 generation in Puerto Rico; 

8 (ii) improve performance of energy in9 frastructure and overall energy efficiency; 

10 (iii) expedite the diversification and 

11 conversion of fuel sources for electric gen12 eration from oil to natural gas and renew13 ables in Puerto Rico as defined under ap14 plicable Puerto Rico laws; 

15 (iv) promote the development and uti16 lization of energy sources found on Puerto 

17 Rico; 

18 (v) contribute to transitioning to 

19 privatized generation capacities in Puerto 

20 Rico; 

21 (vi) support the Energy Commission 

22 of Puerto Rico in achievement of its goal 

23 of reducing energy costs and ensuring af24 fordable energy rates for consumers and 

25 business; or 
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1 (vii) achieve in whole or in part the 

2 recommendations, if feasible, of the study 

3 in section 505(d) of this title to the extent 

4 such study is completed and not incon5 sistent with studies or plans otherwise re6 quired under Puerto Rico laws. 

7 (2) IDENTIFICATION OF RELEVANT PUERTO

8 RICO AGENCIES.—Within 20 days of receiving a 

9 project submission under paragraph (1), the Revital10 ization Coordinator shall, in consultation with the 

11 Governor, identify all Puerto Rico Agencies that will 

12 have a role in the permitting, approval, authorizing, 

13 or other activity related to the development of such 

14 project submission. 

15 (3) EXPEDITED PERMITTING PROCESS.— 

16 (A) SUBMISSION OF EXPEDITED PERMIT17 TING PROCESS.—Not later than 20 days after 

18 receiving a project submission, each Puerto 

19 Rico Agency identified in paragraph (1) shall 

20 submit to the Revitalization Coordinator the 

21 Agency’s Expedited Permitting Process. 

22 (B) FAILURE TO PROVIDE EXPEDITED

23 PERMITTING PROCESS.—If a Puerto Rico Agen24 cy fails to provide an Expedited Permitting 

25 Process within 20 days of receiving a project 
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1 submission, the Revitalization Coordinator shall 

2 consult with the Governor to develop within 20 

3 days an Expedited Permitting Process for the 

4 Agency. 

5 (C) IMPLEMENTATION AND

6 PRIORITIZATION.—The Revitalization Coordi7 nator shall require Puerto Rico Agencies to im8 plement the Expedited Permitting Process for 

9 Critical Projects. Critical Projects shall be 

10 prioritized to the maximum extent possible in 

11 each Puerto Rico Agency regardless of any 

12 agreements transferring or delegating permit13 ting authority to any other Territorial Instru14 mentality or municipality. 

15 (b) CRITICAL PROJECT REPORT.— 

16 (1) IN GENERAL.—For each submitted project, 

17 the Revitalization Coordinator in consultation with 

18 the Governor and relevant Puerto Rico Agencies 

19 identified in subsection (a)(2) shall develop a Crit20 ical Project Report within 60 days of the project 

21 submission, which shall include: 

22 (A) An assessment of how well the project 

23 meets the criteria in subsection (a)(1). 

24 (B) A recommendation by the Governor 

25 whether the project should be considered a Crit-
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1 ical Project. If the Governor fails to provide a 

2 recommendation during the development of the 

3 Critical Project Report, the failure shall con4 stitute a concurrence with the Revitalization 

5 Coordinator’s recommendation in subparagraph 

6 (E). 

7 (C) In the case of a project that may affect 

8 the implementation of Land-Use Plans, as de9 fined by Puerto Rico Act 550–2004, a deter10 mination by the Planning Board will be re11 quired within the 60-day timeframe. If the 

12 Planning Board determines such project will be 

13 inconsistent with relevant Land-Use Plans, then 

14 the project will be deemed ineligible for Critical 

15 Project designation. 

16 (D) In the case of an Energy Project that 

17 will connect with the Puerto Rico Electric 

18 Power Authority’s transmission or distribution 

19 facilities, a recommendation by the Energy 

20 Commission of Puerto Rico, if the Energy Com21 mission determines such Energy Project will af22 fect an approved Integrated Resource Plan, as 

23 defined under Puerto Rico Act 54–2014. If the 

24 Energy Commission determines the Energy 

25 Project will adversely affect an approved Inte-
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1 grated Resource Plan, then the Energy Com2 mission shall provide the reasons for such de3 termination and the Energy Project shall be in4 eligible for Critical Project designation, pro5 vided that such determination must be made 

6 during the 60-day timeframe for the develop7 ment of the Critical Project Report. 

8 (E) A recommendation by the Revitaliza9 tion Coordinator whether the project should be 

10 considered a Critical Project. 

11 (2) PUBLIC INVOLVEMENT.—Immediately fol12 lowing the completion of the Critical Project Report, 

13 the Revitalization Coordinator shall make such Crit14 ical Project Report public and allow a period of 30 

15 days for the submission of comments by residents of 

16 Puerto Rico specifically on matters relating to the 

17 designation of a project as a Critical Project. The 

18 Revitalization Coordinator shall respond to the com19 ments within 30 days of closing the coming period 

20 and make the responses publicly available. 

21 (3) SUBMISSION TO OVERSIGHT BOARD.—Not 

22 later than 5 days after the Revitalization Coordi23 nator has responded to the comments under para24 graph (2), the Revitalization Coordinator shall sub-
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1 mit the Critical Project Report to the Oversight 

2 Board. 

3 (c) ACTION BY THE OVERSIGHT BOARD.—Not later 

4 than 30 days after receiving the Critical Project Report, 

5 the Oversight Board, by majority vote, shall approve or 

6 disapprove the project as a Critical Project, if the Over7 sight Board— 

8 (1) approves the project, the project shall be 

9 deemed a Critical Project; and 

10 (2) disapproves the project, the Oversight 

11 Board shall submit to the Revitalization Coordinator 

12 in writing the reasons for disapproval. 

13 SEC. 504. MISCELLANEOUS PROVISIONS. 

14 (a) CREATION OF INTERAGENCY ENVIRONMENTAL

15 SUBCOMMITTEE.— 

16 (1) ESTABLISHMENT.—Not later than 60 days 

17 after the date on which the Revitalization Coordi18 nator is appointed, the Interagency Environmental 

19 Subcommittee shall be established and shall evaluate 

20 environmental documents required under Puerto 

21 Rico law for any Critical Project within the Expe22 dited Permitting Process established by the Revital23 ization Coordinator under section 503(a)(3). 

24 (2) COMPOSITION.—The Interagency Environ25 mental Subcommittee shall consist of the Revitaliza-
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1 tion Coordinator, and a representative selected by 

2 the Governor in consultation with the Revitalization 

3 Coordinator representing each of the following agen4 cies: The Environmental Quality Board, the Plan5 ning Board, the Puerto Rico Department of Natural 

6 and Environmental Resources, and any other Puerto 

7 Rico Agency determined to be relevant by the Revi8 talization Coordinator. 

9 (b) LENGTH OF EXPEDITED PERMITTING PROC10 ESS.—With respect to a Puerto Rico Agency’s activities 

11 related only to a Critical Project, such Puerto Rico Agency 

12 shall operate as if the Governor has declared an emergency 

13 pursuant to section 2 of Act 76 (3 L.P.R.A. 1932). Sec14 tion 12 of Act 76 (3 L.P.R.A. 1942) shall not be applica15 ble to Critical Projects. Furthermore, any transactions, 

16 processes, projects, works, or programs essential to the 

17 completion of a Critical Project shall continue to be proc18 essed and completed under such Expedited Permitting 

19 Process regardless of the termination of the Oversight 

20 Board under section 209. 

21 (c) EXPEDITED PERMITTING PROCESS COMPLI22 ANCE.— 

23 (1) WRITTEN NOTICE.—A Critical Project 

24 Sponsor may in writing notify the Oversight Board 

25 of the failure of a Puerto Rico Agency or the Revi-
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1 talization Coordinator to adhere to the Expedited 

2 Permitting Process. 

3 (2) FINDING OF FAILURE.—If the Oversight 

4 Board finds either the Puerto Rico Agency or Revi5 talization Coordinator has failed to adhere to the 

6 Expedited Permitting Process, the Oversight Board 

7 shall direct the offending party to comply with the 

8 Expedited Permitting Process. The Oversight Board 

9 may take such enforcement action as necessary as 

10 provided by section 104(l). 

11 (d) REVIEW OF LEGISLATURE ACTS.— 

12 (1) SUBMISSION OF ACTS TO OVERSIGHT

13 BOARD.—Pursuant to section 204(a), the Governor 

14 shall submit to the Oversight Board any law duly 

15 enacted during any fiscal year in which the Over16 sight Board is in operation that may affect the Ex17 pedited Permitting Process. 

18 (2) FINDING OF OVERSIGHT BOARD.—Upon re19 ceipt of a law under paragraph (1), the Oversight 

20 Board shall promptly review whether the law would 

21 adversely impact the Expedited Permitting Process 

22 and, upon such a finding, the Oversight Board may 

23 deem such law to be significantly inconsistent with 

24 the applicable Fiscal Plan. 
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1 (e) ESTABLISHMENT OF CERTAIN TERMS AND CON2 DITIONS.—No Puerto Rico Agency may include in any cer3 tificate, right-of-way, permit, lease, or other authorization 

4 issued for a Critical Project any term or condition that 

5 may be permitted, but is not required, by any applicable 

6 Puerto Rico law, if the Revitalization Coordinator deter7 mines the term or condition would prevent or impair the 

8 expeditious construction, operation, or expansion of the 

9 Critical Project. The Revitalization Coordinator may re10 quest a Puerto Rico Agency to include in any certificate, 

11 right-of-way, permit, lease, or other authorization, a term 

12 or condition that may be permitted in accordance with ap13 plicable laws if the Revitalization Coordinator determines 

14 such inclusion would support the expeditious construction, 

15 operation, or expansion of any Critical Project. 

16 (f) DISCLOSURE.—All Critical Project reports, and 

17 justifications for approval or rejection of Critical Project 

18 status, shall be made publicly available online within 5 

19 days of receipt or completion. 

20 SEC. 505. FEDERAL AGENCY REQUIREMENTS. 

21 (a) FEDERAL POINTS OF CONTACT.—At the request 

22 of the Revitalization Coordinator and within 30 days of 

23 receiving such a request, each Federal agency with juris24 diction over the permitting, or administrative or environ25 mental review of private or public projects in Puerto Rico, 
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1 shall name a Point of Contact who will serve as that agen2 cy’s liaison with the Revitalization Coordinator. 

3 (b) FEDERAL GRANTS AND LOANS.—For each Crit4 ical Project with a pending or potential Federal grant, 

5 loan, or loan guarantee application, the Revitalization Co6 ordinator and the relevant Point of Contact shall cooper7 ate with each other to ensure expeditious review of such 

8 application. 

9 (c) EXPEDITED REVIEWS AND ACTIONS OF FEDERAL

10 AGENCIES.—All reviews conducted and actions taken by 

11 any Federal agency relating to a Critical Project shall be 

12 expedited in a manner consistent with completion of the 

13 necessary reviews and approvals by the deadlines under 

14 the Expedited Permitting Process, but in no way shall the 

15 deadlines established through the Expedited Permitting 

16 Process be binding on any Federal agency. 

17 (d) TRANSFER OF STUDY OF ELECTRIC RATES.— 

18 Section 9 of the Consolidated and Further Continuing Ap19 propriations Act, 2015 (48 U.S.C. 1492a) is amended— 

20 (1) in subsection (a)(5), by inserting ‘‘, except 

21 that, with respect to Puerto Rico, the term means, 

22 the Secretary of Energy’’ after ‘‘Secretary of the In23 terior’’; and 

24 (2) in subsection (b)— 
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1 (A) by inserting ‘‘(except in the case of 

2 Puerto Rico, in which case not later than 270 

3 days after the date of enactment of the Puerto 

4 Rico Oversight, Management, and Economic 

5 Stability Act)’’ after ‘‘of this Act’’; and 

6 (B) by inserting ‘‘(except in the case of 

7 Puerto Rico)’’ after ‘‘Empowering Insular Com8 munities activity’’. 

9 SEC. 506. JUDICIAL REVIEW. 

10 (a) DEADLINE FOR FILING OF A CLAIM.—A claim 

11 arising under this title must be brought no later than 30 

12 days after the date of the decision or action giving rise 

13 to the claim. 

14 (b) EXPEDITED CONSIDERATION.—The District 

15 Court for the District of Puerto Rico shall set any action 

16 brought under this title for expedited consideration, taking 

17 into account the interest of enhancing Puerto Rico’s infra18 structure for electricity, water and sewer services, roads 

19 and bridges, ports, and solid waste management to achieve 

20 compliance with local and Federal environmental laws, 

21 regulations, and policies while ensuring the continuity of 

22 adequate services to the people of Puerto Rico and Puerto 

23 Rico’s sustainable economic development. 
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1 SEC. 507. SAVINGS CLAUSE. 

2 Nothing in this title is intended to change or alter 

3 any Federal legal requirements or laws. 

4 TITLE VI—CREDITOR 

5 COLLECTIVE ACTION 

6 SEC. 601. CREDITOR COLLECTIVE ACTION. 

7 (a) DEFINITIONS.—In this title: 

8 (1) ADMINISTRATIVE SUPERVISOR.—The term 

9 ‘‘Administrative Supervisor’’ means the Oversight 

10 Board established under section 101. 

11 (2) AUTHORIZED TERRITORIAL INSTRUMEN12 TALITY.—The term ‘‘Authorized Territorial Instru13 mentality’’ means a covered territorial instrumen14 tality authorized in accordance with subsection (e). 

15 (3) CALCULATION AGENT.—The term ‘‘Calcula16 tion Agent’’ means a calculation agent appointed in 

17 accordance with subsection (k). 

18 (4) CAPITAL APPRECIATION BOND.—The term 

19 ‘‘Capital Appreciation Bond’’ means a Bond that 

20 does not pay interest on a current basis, but for 

21 which interest amounts are added to principal over 

22 time as specified in the relevant offering materials 

23 for such Bond, including that the accreted interest 

24 amount added to principal increases daily. 

25 (5) CONVERTIBLE CAPITAL APPRECIATION

26 BOND.—The term ‘‘Convertible Capital Appreciation 
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1 Bond’’ means a Bond that does not pay interest on 

2 a current basis, but for which interest amounts are 

3 added to principal over time as specified in the rel4 evant offering materials and which converts to a cur5 rent pay bond on a future date. 

6 (6) INFORMATION AGENT.—The term ‘‘Infor7 mation Agent’’ means an information agent ap8 pointed in accordance with subsection (l). 

9 (7) INSURED BOND.—The term ‘‘Insured 

10 Bond’’ means a bond subject to a financial guar11 antee or similar insurance contract, policy or surety 

12 issued by a monoline insurer. 

13 (8) ISSUER.—The term ‘‘Issuer’’ means, as ap14 plicable, the Territory Government Issuer or an Au15 thorized Territorial Instrumentality that has issued 

16 or guaranteed at least one Bond that is Out17 standing. 

18 (9) MODIFICATION.—The term ‘‘Modification’’ 

19 means any modification, amendment, supplement or 

20 waiver affecting one or more series of Bonds, includ21 ing those effected by way of exchange, repurchase, 

22 conversion, or substitution. 

23 (10) OUTSTANDING.—The term ‘‘Outstanding,’’ 

24 in the context of the principal amount of Bonds, 
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1 shall be determined in accordance with subsection 

2 (b). 

3 (11) OUTSTANDING PRINCIPAL.—The term 

4 ‘‘Outstanding Principal’’ means— 

5 (A) for a Bond that is not a Capital Ap6 preciation Bond or a Convertible Capital Appre7 ciation Bond, the outstanding principal amount 

8 of such Bond; and 

9 (B) for a Bond that is a Capital Apprecia10 tion Bond or a Convertible Capital Appreciation 

11 Bond, the current accreted value of such Cap12 ital Appreciation Bond or a Convertible Capital 

13 Appreciation Bond, as applicable. 

14 (12) POOL.—The term ‘‘Pool’’ means a pool es15 tablished in accordance with subsection (d). 

16 (13) QUALIFYING MODIFICATION.—The term 

17 ‘‘Qualifying Modification’’ means a Modification pro18 posed in accordance with subsection (g). 

19 (14) SECURED POOL.—The term ‘‘Secured 

20 Pool’’ means a Pool established in accordance with 

21 subsection (d) consisting only of Bonds that are se22 cured by a lien on property, provided that the inclu23 sion of a Bond Claim in such Pool shall not in any 

24 way limit or prejudice the right of the Issuer, the 

25 Administrative Supervisor, or any creditor to re-
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1 characterize or challenge such Bond Claim, or any 

2 purported lien securing such Bond Claim, in any 

3 other manner in any subsequent proceeding in the 

4 event a proposed Qualifying Modification is not con5 summated. 

6 (15) TERRITORY GOVERNMENT ISSUER.—The 

7 term ‘‘Territory Government Issuer’’ means the Gov8 ernment of Puerto Rico or such covered territory for 

9 which an Oversight Board has been established pur10 suant to section 101. 

11 (b) OUTSTANDING BONDS.—In determining whether 

12 holders of the requisite principal amount of Outstanding 

13 Bonds have voted in favor of, or consented to, a proposed 

14 Qualifying Modification, a Bond will be deemed not to be 

15 outstanding, and may not be counted in a vote or consent 

16 solicitation for or against a proposed Qualifying Modifica17 tion, if on the record date for the proposed Qualifying 

18 Modification— 

19 (1) the Bond has previously been cancelled or 

20 delivered for cancellation or is held for reissuance 

21 but has not been reissued; 

22 (2) the Bond has previously been called for re23 demption in accordance with its terms or previously 

24 become due and payable at maturity or otherwise 

25 and the Issuer has previously satisfied its obligation 
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1 to make, or provide for, all payments due in respect 

2 of the Bond in accordance with its terms; 

3 (3) the Bond has been substituted with a secu4 rity of another series; or 

5 (4) the Bond is held by the Issuer or by an Au6 thorized Territorial Instrumentality of the Territory 

7 Government Issuer or by a corporation, trust or 

8 other legal entity that is controlled by the Issuer or 

9 an Authorized Territorial Instrumentality of the 

10 Territory Government Issuer, as applicable. 

11 For purposes of this subsection, a corporation, trust or 

12 other legal entity is controlled by the Issuer or by an Au13 thorized Territorial Instrumentality of the Territory Gov14 ernment Issuer if the Issuer or an Authorized Territorial 

15 Instrumentality of the Territory Government Issuer, as 

16 applicable, has the power, directly or indirectly, through 

17 the ownership of voting securities or other ownership in18 terests, by contract or otherwise, to direct the manage19 ment of or elect or appoint a majority of the board of di20 rectors or other persons performing similar functions in 

21 lieu of, or in addition to, the board of directors of that 

22 legal entity. 

23 (c) CERTIFICATION OF DISENFRANCHISED BONDS.— 

24 Prior to any vote on, or consent solicitation for, a Quali25 fying Modification, the Issuer shall deliver to the Calcula-
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1 tion Agent a certificate signed by an authorized represent2 ative of the Issuer specifying any Bonds that are deemed 

3 not to be Outstanding for the purpose of subsection (b) 

4 above. 

5 (d) DETERMINATION OF POOLS FOR VOTING.—The 

6 Administrative Supervisor, in consultation with the Issuer, 

7 shall establish Pools in accordance with the following: 

8 (1) Not less than one Pool shall be established 

9 for each Issuer. 

10 (2) A Pool that contains one or more Bonds 

11 that are secured by a lien on property shall be a Se12 cured Pool. 

13 (3) The Administrative Supervisor shall estab14 lish Pools according to the following principles: 

15 (A) For each Issuer that has issued mul16 tiple Bonds that are distinguished by specific 

17 provisions governing priority or security ar18 rangements, including Bonds that have been 

19 issued as general obligations of the Territory 

20 Government Issuer to which the Territory Gov21 ernment Issuer pledged the full or good faith, 

22 credit, and taxing power of the Territory Gov23 ernment Issuer, separate Pools shall be estab24 lished corresponding to the relative priority or 

25 security arrangements of each holder of Bonds 
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1 against each Issuer, as applicable, provided, 

2 however, that the term ‘‘priority’’ as used in 

3 this section shall not be understood to mean 

4 differing payment or maturity dates. 

5 (B) For each Issuer that has issued senior 

6 and subordinated Bonds, separate Pools shall 

7 be established for the senior and subordinated 

8 Bonds corresponding to the relative priority or 

9 security arrangements. 

10 (C) For each Issuer that has issued mul11 tiple Bonds, for at least some of which a guar12 antee of repayment has been provided by the 

13 Territory Government Issuer, separate Pools 

14 shall be established for such guaranteed and 

15 non-guaranteed Bonds. 

16 (D) Subject to the other requirements con17 tained in this section, for each Issuer that has 

18 issued multiple Bonds, for at least some of 

19 which a dedicated revenue stream has been 

20 pledged for repayment, separate Pools for such 

21 Issuer shall be established as follows— 

22 (i) for each dedicated revenue stream 

23 that has been pledged for repayment, not 

24 less than one Secured Pool for Bonds for 

25 which such revenue stream has been 
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1 pledged, and separate Secured Pools shall 

2 be established for Bonds of different pri3 ority; and 

4 (ii) not less than one Pool for all 

5 other Bonds issued by the Issuer for which 

6 a dedicated revenue stream has not been 

7 pledged for repayment. 

8 (E) The Administrative Supervisor shall 

9 not place into separate Pools Bonds of the same 

10 Issuer that have identical rights in security or 

11 priority. 

12 (4) Notwithstanding the preceding provisions of 

13 this subsection, solely with respect to a preexisting 

14 voluntary agreement as described in section 

15 104(i)(3) of this Act, such voluntary agreement may 

16 classify Insured Bonds and uninsured bonds in dif17 ferent Pools and provide different treatment thereof 

18 so long as the preexisting voluntary agreement has 

19 been agreed to by— 

20 (A) holders of a majority in amount of all 

21 uninsured bonds outstanding in the modified 

22 Pool; and 

23 (B) holders (including insurers with power 

24 to vote) of a majority in amount of all Insured 

25 Bonds. 
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1 (e) AUTHORIZATION OF TERRITORY INSTRUMENTAL2 ITIES.—A covered territorial instrumentality is an Author3 ized Territorial Instrumentality if it has been specifically 

4 authorized to be eligible to avail itself of the procedures 

5 under this section by the Administrative Supervisor. 

6 (f) INFORMATION DELIVERY REQUIREMENT.—Be7 fore solicitation of acceptance or rejection of a Modifica8 tion under subsection (h), the Issuer shall provide to the 

9 Calculation Agent, the Information Agent, and the Admin10 istrative Supervisor, the following information— 

11 (1) a description of the Issuer’s economic and 

12 financial circumstances which are, in the Issuer’s 

13 opinion, relevant to the request for the proposed 

14 Qualifying Modification, a description of the Issuer’s 

15 existing debts, a description of the impact of the 

16 proposed Qualifying Modification on the territory’s 

17 or its territorial instrumentalities’ public debt; 

18 (2) if the Issuer is seeking Modifications affect19 ing any other Pools of Bonds of the Territory Gov20 ernment Issuer or its Authorized Territorial Instru21 mentalities, a description of such other Modifica22 tions; 

23 (3) if a Fiscal Plan with respect to such Issuer 

24 has been certified, the applicable Fiscal Plan cer25 tified in accordance with section 201; and 
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1 (4) such other information as may be required 

2 under applicable securities laws. 

3 (g) QUALIFYING MODIFICATION.—A Modification is 

4 a Qualifying Modification if one of the following processes 

5 has occurred: 

6 (1) CONSULTATION PROCESS.— 

7 (A) the Issuer proposing the Modification 

8 has consulted with holders of Bonds in each 

9 Pool of such Issuer prior to soliciting a vote on 

10 such Modification; 

11 (B) each exchanging, repurchasing, con12 verting, or substituting holder of Bonds of any 

13 series in a Pool affected by that Modification is 

14 offered the same amount of consideration per 

15 amount of principal, the same amount of con16 sideration per amount of interest accrued but 

17 unpaid and the same amount of consideration 

18 per amount of past due interest, respectively, as 

19 that offered to each other exchanging, repur20 chasing, converting, or substituting holder of 

21 Bonds of any series in a Pool affected by that 

22 Modification (or, where a menu of instruments 

23 or other consideration is offered, each exchang24 ing, repurchasing, converting, or substituting 

25 holder of Bonds of any series in a Pool affected 
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1 by that Modification is offered the same 

2 amount of consideration per amount of prin3 cipal, the same amount of consideration per 

4 amount of interest accrued but unpaid and the 

5 same amount of consideration per amount of 

6 past due interest, respectively, as that offered 

7 to each other exchanging, repurchasing, con8 verting, or substituting holder of Bonds of any 

9 series in a Pool affected by that Modification 

10 electing the same option under such menu of in11 struments); and 

12 (C) the Modification is certified by the Ad13 ministrative Supervisor as being consistent with 

14 the requirements set forth in section 104(i)(1) 

15 and is in the best interests of the creditors and 

16 is feasible. 

17 (2) VOLUNTARY AGREEMENT PROCESS.—The 

18 Administrative Supervisor has issued a certification 

19 that— 

20 (A) the requirements set forth in section 

21 104(i)(2) and section 601(g)(1)(B) have been 

22 satisfied; or 

23 (B) the Modification is consistent with a 

24 restructuring support or similar agreement to 

25 be implemented pursuant to the law of the cov-
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1 ered territory executed by the Issuer prior to 

2 the establishment of an Oversight Board for the 

3 relevant territory. 

4 (h) SOLICITATION.— 

5 (1) Upon receipt of a certification from the Ad6 ministrative Supervisor under subsection (g), the In7 formation Agent shall, if practical and except as pro8 vided in paragraph (2), submit to the holders of any 

9 Outstanding Bonds of the relevant Issuer, including 

10 holders of the right to vote such Outstanding Bonds, 

11 the information submitted by the relevant Issuer 

12 under subsection (f)(1) in order to solicit the vote of 

13 such holders to approve or reject the Qualifying 

14 Modification. 

15 (2) If the Information Agent is unable to iden16 tify the address of holders of any Outstanding 

17 Bonds of the relevant Issuer, the Information Agent 

18 may solicit the vote or consent of such holders by— 

19 (A) delivering the solicitation to the paying 

20 agent for any such Issuer or Depository Trust 

21 Corporation if it serves as the clearing system 

22 for any of the Issuer’s Outstanding Bonds; or 

23 (B) delivering or publishing the solicitation 

24 by whatever additional means the Information 

25 Agent, after consultation with the Issuer, deems 
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1 necessary and appropriate in order to make a 

2 reasonable effort to inform holders of any Out3 standing Bonds of the Issuer which may in4 clude, notice by mail, publication in electronic 

5 media, publication on a website of the Issuer, or 

6 publication in newspapers of national circula7 tion in the United States and in a newspaper 

8 of general circulation in the territory. 

9 (i) WHO MAY PROPOSE A MODIFICATION.—For each 

10 Issuer, a Modification may be proposed to the Administra11 tive Supervisor by the Issuer or by one or more holders 

12 of the right to vote the Issuer’s Outstanding Bonds. To 

13 the extent a Modification proposed by one or more holders 

14 of the right to vote Outstanding Bonds otherwise complies 

15 with the requirements of this title, the Administrative Su16 pervisor may accept such Modification on behalf of the 

17 Issuer, in which case the Administrative Supervisor will 

18 instruct the Issuer to provide the information required in 

19 subsection (f). 

20 (j) VOTING.—For each Issuer, any Qualifying Modi21 fication may be made with the affirmative vote of the hold22 ers of the right to vote at least two-thirds of the Out23 standing Principal amount of the Outstanding Bonds in 

24 each Pool that have voted to approve or reject the Quali25 fying Modification, provided that holders of the right to 
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1 vote not less than a majority of the aggregate Outstanding 

2 Principal amount of all the Outstanding Bonds in each 

3 Pool have voted to approve the Qualifying Modification. 

4 The holder of the right to vote the Outstanding Bonds 

5 that are Insured Bonds shall be the monoline insurer in6 suring such Insured Bond to the extent such insurer is 

7 granted the right to vote Insured Bonds for purposes of 

8 directing remedies or consenting to proposed amendments 

9 or modifications as provided in the applicable documents 

10 pursuant to which such Insured Bond was issued and in11 sured. 

12 (k) CALCULATION AGENT.—For the purpose of cal13 culating the principal amount of the Bonds of any series 

14 eligible to participate in such a vote or consent solicitation 

15 and tabulating such votes or consents, the Territory Gov16 ernment Issuer may appoint a Calculation Agent for each 

17 Pool reasonably acceptable to the Administrative Super18 visor. 

19 (l) INFORMATION AGENT.—For the purpose of ad20 ministering a vote of holders of Bonds, including the hold21 ers of the right to vote such Bonds, or seeking the consent 

22 of holder of Bonds, including the holders of the right to 

23 vote such Bonds, to a written action under this section, 

24 the Territory Government Issuer may appoint an Informa-
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1 tion Agent for each Pool reasonably acceptable to the Ad2 ministrative Supervisor. 

3 (m) BINDING EFFECT.— 

4 (1) A Qualifying Modification will be conclusive 

5 and binding on all holders of Bonds whether or not 

6 they have given such consent, and on all future hold7 ers of those Bonds whether or not notation of such 

8 Qualifying Modification is made upon the Bonds, 

9 if— 

10 (A) the holders of the right to vote the 

11 Outstanding Bonds in every Pool of the Issuer 

12 pursuant to subsection (j) have consented to or 

13 approved the Qualifying Modification; 

14 (B) the Administrative Supervisor certifies 

15 that— 

16 (i) the voting requirements of this sec17 tion have been satisfied; 

18 (ii) the Qualifying Modification com19 plies with the requirements set forth in 

20 section 104(i)(1); and 

21 (iii) except for such conditions that 

22 have been identified in the Qualifying 

23 Modification as being non-waivable, any 

24 conditions on the effectiveness of the 

25 Qualifying Modification have been satisfied 
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1 or, in the Administrative Supervisor’s sole 

2 discretion, satisfaction of such conditions 

3 has been waived; 

4 (C) with respect to a Bond Claim that is 

5 secured by a lien on property and with respect 

6 to which the holder of such Bond Claim has re7 jected or not consented to the Qualifying Modi8 fication, the holder of such Bond— 

9 (i) retains the lien securing such Bond 

10 Claims; or 

11 (ii) receives on account of such Bond 

12 Claim, through deferred cash payments, 

13 substitute collateral, or otherwise, at least 

14 the equivalent value of the lesser of the 

15 amount of the Bond Claim or of the collat16 eral securing such Bond Claim; and 

17 (D) the district court for the territory or, 

18 for any territory that does not have a district 

19 court, the United States District Court for the 

20 District of Hawaii, has, after reviewing an ap21 plication submitted to it by the applicable 

22 Issuer for an order approving the Qualifying 

23 Modification, entered an order that the require24 ments of this section have been satisfied. 
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1 (2) Upon the entry of an order under para2 graph (1)(D), the conclusive and binding Qualifying 

3 Modification shall be valid and binding on any per4 son or entity asserting claims or other rights, includ5 ing a beneficial interest (directly or indirectly, as 

6 principal, agent, counterpart, subrogee, insurer or 

7 otherwise) in respect of Bonds subject to the Quali8 fying Modification, any trustee, any collateral agent, 

9 any indenture trustee, any fiscal agent, and any 

10 bank that receives or holds funds related to such 

11 Bonds. All property of an Issuer for which an order 

12 has been entered under paragraph (1)(D) shall vest 

13 in the Issuer free and clear of all claims in respect 

14 of any Bonds of any other Issuer. Such Qualifying 

15 Modification will be full, final, complete, binding, 

16 and conclusive as to the territorial government 

17 Issuer, other territorial instrumentalities of the terri18 torial government Issuer, and any creditors of such 

19 entities, and should not be subject to any collateral 

20 attack or other challenge by any such entities in any 

21 court or other forum. Other than as provided herein, 

22 the foregoing shall not prejudice the rights and 

23 claims of any party that insured the Bonds, includ24 ing the right to assert claims under the Bonds as 

25 modified following any payment under the insurance 
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1 policy, and no claim or right that may be asserted 

2 by any party in a capacity other than holder of a 

3 Bond affected by the Qualifying Modification shall 

4 be satisfied, released, discharged, or enjoined by this 

5 provision. 

6 (n) JUDICIAL REVIEW.— 

7 (1) The district court for the territory or, for 

8 any territory that does not have a district court, the 

9 United States District Court for the District of Ha10 waii shall have original and exclusive jurisdiction 

11 over civil actions arising under this section. 

12 (2) Notwithstanding section 106(e), there shall 

13 be a cause of action to challenge unlawful applica14 tion of this section. 

15 (3) The district court shall nullify a Modifica16 tion and any effects on the rights of the holders of 

17 Bonds resulting from such Modification if and only 

18 if the district court determines that such Modifica19 tion is manifestly inconsistent with this section. 

20 SEC. 602. APPLICABLE LAW. 

21 In any judicial proceeding regarding this title, Fed22 eral, State, or territorial laws of the United States, as ap23 plicable, shall govern and be applied without regard or ref24 erence to any law of any international or foreign jurisdic25 tion. 
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1 TITLE VII—SENSE OF CONGRESS 

2 REGARDING PERMANENT, 

3 PRO-GROWTH FISCAL RE4 FORMS 

5 SEC. 701. SENSE OF CONGRESS REGARDING PERMANENT, 

6 PRO-GROWTH FISCAL REFORMS. 

7 It is the sense of the Congress that any durable solu8 tion for Puerto Rico’s fiscal and economic crisis should 

9 include permanent, pro-growth fiscal reforms that feature, 

10 among other elements, a free flow of capital between pos11 sessions of the United States and the rest of the United 

12 States. 

Passed the House of Representatives June 9, 2016. 

Attest: 

Clerk. 
114TH CONGRESS 

2D SESSION H. R. 5278 

AN ACT 

To establish an Oversight Board to assist the Govother purposes. ities, in managing its public finances, and for ernment of Puerto Rico, including instrumental-