I 

116TH CONGRESS 

1ST SESSION H. R. 2526 

To provide the option of discharging certain unsecured financial obligations 

of self-governing territories of the United States. 

IN THE HOUSE OF REPRESENTATIVES 

MAY 3, 2019 

Ms. VELA ́ZQUEZ (for herself, Ms. CLARKE of New York, Mr. ESPAILLAT, Mr. 

GALLEGO, Ms. JAYAPAL, Mr. KHANNA, Ms. SCHAKOWSKY, Mr. SIRES, 

Mr. SOTO, and Ms. NORTON) introduced the following bill; which was referred to the Committee on Natural Resources, and in addition to the 

Committees on the Judiciary, and the Budget, for a period to be subsequently determined by the Speaker, in each case for consideration of such 

provisions as fall within the jurisdiction of the committee concerned 

A BILL 

To provide the option of discharging certain unsecured financial obligations of self-governing territories of the United 

States. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE; TABLE OF CONTENTS. 

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

5 ‘‘United States Territorial Relief Act of 2019’’. 

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

7 this Act is as follows: 


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Sec. 1. Short title; table of contents. 

Sec. 2. Definitions. 

Sec. 3. Findings. 

TITLE I—TERRITORIAL RELIEF 

Sec. 101. Relief through exercise of the power to regulate commerce, the bankruptcy power, and the territorial power. 

Sec. 102. Effect of discharge. 

Sec. 103. Actions relating to the status of financial obligations. 

Sec. 104. Notice of discharge. 

Sec. 105. Effective date. 

TITLE II—PUERTO RICO DEBT RESTRUCTURING COMPENSATION 

FUND 

Sec. 201. Purpose. 

Sec. 202. Definitions. 

Sec. 203. Administration. 

Sec. 204. Determination of eligibility for compensation. 

Sec. 205. Puerto Rico Debt Restructuring Compensation Fund. 

Sec. 206. Regulations. 

Sec. 207. Sunset. 

TITLE III—PUERTO RICO PUBLIC CREDIT COMPREHENSIVE 

AUDIT COMMISSION 

Sec. 301. Definitions. 

Sec. 302. Establishment; dissolution. 

Sec. 303. Reports. 

Sec. 304. Duties. 

Sec. 305. Authority of the Commission. 

Sec. 306. Membership. 

Sec. 307. Powers and responsibilities. 

Sec. 308. Provision of requested information. 

Sec. 309. Access to information. 

Sec. 310. Funding. 

TITLE IV—SEVERABILITY 

Sec. 401. Severability. 

1 SEC. 2. DEFINITIONS. 

2 In this Act: 

3 (1) ATTACHMENT.—The term ‘‘attachment’’ 

4 means the time at which a security interest becomes 

5 enforceable against a debtor with respect to collat6 eral. 


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1 (2) COLLATERAL.—The term ‘‘collateral’’ 

2 means property subject to a security interest. 

3 (3) FINANCIAL GUARANTY INSURANCE.—The 

4 term ‘‘financial guaranty insurance’’ means a surety 

5 bond, an insurance policy, an indemnity contract, or 

6 any similar guaranty, under which loss is payable on 

7 proof of a financial loss to an insured claimant, an 

8 obligee, or an indemnitee as a result of the failure 

9 of any obligor on or issuer of any debt instrument 

10 or other monetary obligation to pay, when due, prin11 cipal, interest, or any other amount due or payable 

12 with respect to that instrument or obligation, if that 

13 failure to pay is the result of a financial default, a 

14 financial insolvency, or a discharge in bankruptcy. 

15 (4) FINANCIAL GUARANTY INSURER.—The term 

16 ‘‘financial guaranty insurer’’ means a party that is 

17 obligated as a surety, insurer, or indemnitor under 

18 a financial guaranty insurance contract. 

19 (5) FINANCIAL OBLIGATION.—The term ‘‘finan20 cial obligation’’— 

21 (A) means an obligation validly owed as of 

22 the effective date of this Act by a qualifying 

23 territory or an instrumentality of a qualifying 

24 territory thereof that arises from any— 


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1 (i) security issued by a qualifying ter2 ritory or instrumentality of a qualifying 

3 territory; 

4 (ii) loan taken out by a qualifying ter5 ritory or instrumentality of a qualifying 

6 territory; 

7 (iii) repurchase or swap or other de8 rivative contract entered into by a quali9 fying territory or instrumentality of a 

10 qualifying territory; or 

11 (iv) guaranty of any security or loan 

12 or repurchase or swap or other derivative 

13 contract by a qualifying territory or instru14 mentality of a qualifying territory; and 

15 (B) does not include any— 

16 (i) claim made by a vendor or service 

17 provider that is owed payment by a quali18 fying territory or an instrumentality of a 

19 qualifying territory for a good or service 

20 rendered in the ordinary course of busi21 ness; 

22 (ii) claim made by or on behalf of a 

23 current or former employee of a qualifying 

24 territory or an instrumentality of a quali25 fying territory that is owed payment for a 


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1 pension or other retirement benefit, or for 

2 a health care benefit of any kind; or 

3 (iii) claim against a qualifying terri4 tory or an instrumentality of a qualifying 

5 territory for a pending tax refund or tax 

6 credit. 

7 (6) INSTRUMENTALITY.—The term ‘‘instrumen8 tality’’ includes— 

9 (A) a political subdivision of a qualifying 

10 territory; 

11 (B) a public agency of a qualifying terri12 tory; 

13 (C) a public corporation of a qualifying 

14 territory; and 

15 (D) a banking corporation of a qualifying 

16 territory. 

17 (7) PER CAPITA DEBT OF A TERRITORY.—The 

18 term ‘‘per capita debt of a territory’’ means the 

19 quotient obtained by dividing— 

20 (A) the aggregate amount of the financial 

21 obligations of a territory and the instrumental22 ities of the territory, which shall not include— 

23 (i) the Federal debt; or 

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1 fying territory or any instrumentality of a 

2 qualifying territory for the payment of 

3 pension and other retirement benefits, or 

4 health care benefits of any kind, to current 

5 or former employees of the qualifying terri6 tory or the instrumentality of the quali7 fying territory that are owed payment for 

8 a pension or other retirement benefit, or 

9 for a health care benefit of any kind; by 

10 (B) the population of the territory (based 

11 on the most recent data available from the Bu12 reau of the Census). 

13 (8) PROCEEDS.—The term ‘‘proceeds’’ means— 

14 (A) whatever is acquired upon the sale, 

15 lease, license, exchange, or other disposition of 

16 collateral; or 

17 (B) whatever is collected on, or distributed 

18 on account of, collateral. 

19 (9) QUALIFYING TERRITORY.—The term ‘‘quali20 fying territory’’ means a territory that meets not 

21 less than 2 of the following qualifications: 

22 (A) The population of the territory, based 

23 on the most recent data available from the Bu24 reau of the Census, has decreased by more than 


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1 5 percent during the 10-year period ending on 

2 the date of a discharge under section 101. 

3 (B) The territory has received major dis4 aster assistance under the Robert T. Stafford 

5 Disaster Relief and Emergency Assistance Act 

6 (42 U.S.C. 5121 et seq.) during the 5-year pe7 riod ending on the date of a discharge under 

8 section 101. 

9 (C) The per capita debt of the territory is 

10 greater than $15,000 (as adjusted annually to 

11 reflect the percentage change in the Consumer 

12 Price Index for All Urban Consumers published 

13 by the Bureau of Labor Statistics of the De14 partment of Labor). 

15 (10) SECURITY AGREEMENT.—The term ‘‘secu16 rity agreement’’ means an agreement or resolution 

17 that creates or provides for a security interest. 

18 (11) SECURED FINANCIAL OBLIGATION.—The 

19 term ‘‘secured financial obligation’’ means any fi20 nancial obligation to the extent of the value of any 

21 collateral pledged by a qualifying territory or an in22 strumentality of a qualifying territory to secure the 

23 repayment of the financial obligation pursuant to a 

24 valid and perfected security interest under applicable 

25 territorial law, not including— 


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1 (A) any property acquired or anticipated to 

2 be acquired by a qualifying territory or an in3 strumentality of a qualifying territory after the 

4 date of a discharge under section 101, even if 

5 that property, when acquired, would have be6 come collateral subject to a security interest; or 

7 (B) any proceeds, products, offspring, or 

8 profits of the collateral not in existence on the 

9 date of a discharge under section 101, unless 

10 the property constitutes the proceeds of collat11 eral to which the security interest has attached 

12 as of the date of the discharge. 

13 (12) SECURITY INTEREST.—The term ‘‘security 

14 interest’’— 

15 (A) means an interest in property, includ16 ing a lien or other pledge of property, that se17 cures a payment or the performance of an obli18 gation; and 

19 (B) does not include a pledge of the full 

20 faith and credit of a qualifying territory or its 

21 instrumentality, even in the case that such 

22 pledge includes a promise of all available re23 sources of the qualifying territory or its instru24 mentality. 

25 (13) TERRITORY.—The term ‘‘territory’’— 


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1 (A) means any self-governing Federal ter2 ritory; and 

3 (B) includes— 

4 (i) the Commonwealth of Puerto Rico; 

5 (ii) Guam; 

6 (iii) the Commonwealth of the North7 ern Mariana Islands; 

8 (iv) the United States Virgin Islands; 

9 and 

10 (v) American Samoa. 

11 (14) UNSECURED FINANCIAL OBLIGATION.— 

12 The term ‘‘unsecured financial obligation’’ means 

13 any financial obligation to the extent the financial 

14 obligation is not a secured financial obligation. 

15 SEC. 3. FINDINGS. 

16 Congress finds that— 

17 (1) millions of citizens of the United States re18 side in territories of the United States; 

19 (2) the Federal Government owes a special duty 

20 of care and stewardship to the citizens of territories 

21 of the United States because— 

22 (A) historically, Federal administration of 

23 these territories was often wanting and many 

24 residents of the territories faced discriminatory 

25 treatment by the Federal Government; 


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1 (B) the economies of these territories face 

2 special constraints, including diminishment of 

3 property tax bases because of large, untaxed, 

4 Federal land holdings; and 

5 (C) these territories lack the benefits of 

6 many Federal programs, such as Supplemental 

7 Security Income, the Earned Income Tax Cred8 it, and full access to Medicaid; 

9 (3) prolonged economic downturns, declines in 

10 population, and natural disasters have resulted in 

11 some territories of the United States and the instru12 mentalities of those territories having unsupportable 

13 debt burdens on financial obligations, which cannot 

14 realistically be repaid without imposing undue hard15 ship on the citizens and residents of those terri16 tories; 

17 (4) disaster recovery funds that are provided by 

18 the Federal Government should be used for disaster 

19 recovery and not for direct or indirect debt pay20 ments; 

21 (5) unsecured creditors of financially distressed 

22 territories and instrumentalities of those territories 

23 have little prospect of recovery upon default because 

24 of— 


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1 (A) the severe indebtedness of those terri2 tories; and 

3 (B) the lack of effective remedies for unse4 cured creditors against those territories and the 

5 instrumentalities of those territories; and 

6 (6) the people of the Commonwealth of Puerto 

7 Rico deserve to know about the social, political, and 

8 legal factors associated with the amount of the pub9 lic debt of the Commonwealth of Puerto Rico ac10 crued over the past 5 decades, and the Federal Gov11 ernment has a responsibility to support efforts to ob12 tain those answers, including public or private ef13 forts to conduct a comprehensive audit of the public 

14 debt of the Commonwealth of Puerto Rico. 

15 TITLE I—TERRITORIAL RELIEF 

16 SEC. 101. RELIEF THROUGH EXERCISE OF THE POWER TO 

17 REGULATE COMMERCE, THE BANKRUPTCY 

18 POWER, AND THE TERRITORIAL POWER. 

19 (a) IN GENERAL.—Pursuant to clauses 3 and 4 of 

20 section 8 of article I and clause 2, section 3 of article IV 

21 of the Constitution of the United States, any unsecured 

22 financial obligation of a qualifying territory or an instru23 mentality of a qualifying territory that is outstanding is 

24 discharged on the date on which a resolution stating that 

25 the qualifying territory wishes to discharge the unsecured 


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1 financial obligations of the qualifying territory and the in2 strumentalities of the qualifying territory— 

3 (1) is adopted by an affirmative vote of more 

than 1 4 ⁄2 of the members of each house of the legisla5 ture of that qualifying territory and is signed by the 

6 chief executive of the qualifying territory; or 

7 (2) is adopted by an affirmative vote of not less 

than 2 8 ⁄3 of the members of each house of the legisla9 ture of that qualifying territory. 

10 (b) LIMITATION.—A qualifying territory may dis11 charge unsecured financial obligations of the qualifying 

12 territory and the instrumentalities of the qualifying terri13 tory under this title not more frequently than once during 

14 any 7-year period, and such discharge shall prohibit the 

15 qualifying territory from discharging, adjusting, or im16 pairing, in any manner or degree including in a proceeding 

17 under title III of PROMESA (48 U.S.C. 2161 et seq.), 

18 a debt described in section 2(5)(B)(ii). 

19 (c) NO STAY OF ACTIONS BY QUALIFYING TERRI20 TORY TO OBTAIN A DISCHARGE.—Notwithstanding any 

21 other provision of Federal, State, or territorial law, the 

22 ability of a qualifying territory to obtain a discharge under 

23 this Act shall not be stayed, avoided, or otherwise limited 

24 by operation of any provision of law or by order of a court, 


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1 oversight board, or administrative agency in any pro2 ceeding. 

3 (d) SECURED FINANCIAL OBLIGATIONS UNAF4 FECTED.— 

5 (1) IN GENERAL.—Except as provided in para6 graphs (1) and (3) of section 102, nothing in sub7 section (a) shall affect the validity and enforceability 

8 of any financial obligation of a qualifying territory 

9 or an instrumentality of a qualifying territory to the 

10 extent that the obligation is a secured financial obli11 gation. 

12 (2) VOIDABILITY.—Notwithstanding paragraph 

13 (1), a secured financial obligation of a qualifying 

14 territory or an instrumentality of a qualifying terri15 tory may be voidable or otherwise impaired under 

16 any other applicable law. 

17 (e) RULE OF CONSTRUCTION.—Nothing in this Act 

18 shall be construed to operate as a stay of a pending case 

19 brought under title III of PROMESA (48 U.S.C. 2161 

20 et seq.), or of any act of an oversight board appointed 

21 under that Act, or to reinstate any financial obligation dis22 charged under this Act through any procedure under 

23 PROMESA (48 U.S.C. 2101 et seq.). 

24 SEC. 102. EFFECT OF DISCHARGE. 

25 A discharge under section 101 shall— 


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1 (1) except in regard to actions brought under 

2 section 103, operate as a permanent stay, applicable 

3 to all entities and enforceable by the qualifying terri4 tory or an instrumentality of the qualifying territory 

5 in any court with jurisdiction over an action de6 scribed in section 103(a), against the commencement 

7 or continuation of an action, the employment of 

8 process, or an act to collect, recover, or offset any 

9 outstanding financial obligation to the extent that 

10 the financial obligation is not a secured financial ob11 ligation as of the date of the discharge, regardless 

12 of whether discharge of that unsecured financial ob13 ligation is waived by the qualifying territory; 

14 (2) void any outstanding judgment entered on 

15 an unsecured financial obligation of the qualifying 

16 territory or an instrumentality of the qualifying ter17 ritory to the extent that such judgment is a deter18 mination of liability of the qualifying territory or in19 strumentality; and 

20 (3) if prior to the date of the discharge under 

21 section 101, the qualifying territory or an instru22 mentality of the qualifying territory entered into a 

23 security agreement securing a financial obligation, 

24 prevent the security interest created by the security 

25 agreement from attaching to any property acquired 


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1 by the qualifying territory or an instrumentality 

2 thereof after the date of the discharge under section 

3 101, except to the extent that such property con4 stitutes the proceeds of collateral to which the secu5 rity interest had attached as of the date of the dis6 charge. 

7 SEC. 103. ACTIONS RELATING TO THE STATUS OF FINAN8 CIAL OBLIGATIONS. 

9 (a) IN GENERAL.—Any financial obligation is conclu10 sively deemed to be an unsecured financial obligation ex11 cept to the extent that the holder of that obligation proves 

12 that the financial obligation is a secured financial obliga13 tion in an action for a declaratory judgment that is filed— 

14 (1) in— 

15 (A) an appropriate territorial court of the 

16 qualifying territory; or 

17 (B) a district court of the United States in 

18 the qualifying territory; and 

19 (2) not later than 180 days after the date of a 

20 discharge under section 101. 

21 (b) BURDEN OF PROOF.—In an action described in 

22 subsection (a), the holder of an obligation shall be required 

23 to prove by clear and convincing evidence that— 

24 (1) the obligation is a secured financial obliga25 tion; and 


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1 (2) any revenues generated after a discharge 

2 under section 101 are the proceeds of the collateral 

3 securing the secured financial obligation. 

4 (c) EXCLUSIVE JURISDICTION.—Notwithstanding 

5 title 28, United States Code, a court described in sub6 section (a)(1) shall have exclusive jurisdiction over an ac7 tion involving, arising from, or related to the status of a 

8 financial obligation as a secured or an unsecured financial 

9 obligation under subsection (a), including— 

10 (1) any action asserting a taking under the 

11 Fifth Amendment of the Constitution of the United 

12 States; and 

13 (2) any action for declaratory judgment. 

14 (d) APPEALS.—Any appeal from an action under this 

15 section shall be heard solely in— 

16 (1) for a case filed under subsection (a)(1)(A), 

17 the appropriate territorial court of the qualifying 

18 territory; or 

19 (2) for a case filed under subsection (a)(1)(B), 

20 the appropriate court of appeals of the United 

21 States for the qualifying territory. 

22 (e) COSTS.—All parties shall bear their own costs in 

23 an action under this section. 

24 (f) ESTOPPEL.—Any party to an action under this 

25 section shall be estopped in other actions from claiming 


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1 that the party has been deprived of the property of that 

2 party by virtue of— 

3 (1) a discharge under section 101; or 

4 (2) a final ruling in an action described in sub5 section (a) that a financial obligation of a party is 

6 an unsecured financial obligation. 

7 (g) BAR ON AVOIDANCE ACTIONS BY CREDITORS.— 

8 Notwithstanding any other provision of law, a creditor of 

9 a qualifying territory or an instrumentality of a qualifying 

10 territory that has received a discharge under this title may 

11 not avoid or bring an action to avoid, directly or deriva12 tively, any transfer of property made by the qualifying ter13 ritory or instrumentality. 

14 (h) AVOIDANCE OF SECURITY INTERESTS BY QUALI15 FYING TERRITORIES AND INSTRUMENTALITIES OF QUALI16 FYING TERRITORIES.— 

17 (1) IN GENERAL.—In addition to the relief pro18 vided elsewhere in this Act, a qualifying territory or 

19 an instrumentality of a qualifying territory, in a civil 

20 action described in paragraph (2), may avoid any se21 curity interest— 

22 (A) securing a financial obligation that 

23 would be avoidable by a trustee in a case under 

24 chapter 7 of title 11, United States Code, filed 

25 on the date of the discharge under section 101 


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1 if, notwithstanding sections 101(41) and 109(a) 

2 of title 11, United States Code, or any statute 

3 of limitations under that title, the qualifying 

4 territory or the instrumentality of the qualifying 

5 territory were deemed an eligible debtor under 

6 chapter 7 of title 11, United States Code; or 

7 (B) securing a financial obligation to the 

8 extent that the amount owed on the financial 

9 obligation exceeds the value of any collateral, 

10 subject to restrictions under paragraph (3), se11 curing the financial obligation. 

12 (2) CIVIL ACTIONS.—A civil action described in 

13 this paragraph shall be— 

14 (A) brought by a qualifying territory, an 

15 instrumentality of a qualifying territory, or a 

16 relator on behalf of a qualifying territory or an 

17 instrumentality of a qualifying territory not 

18 later than 2 years after the date of a discharge 

19 under section 101; and 

20 (B) filed in— 

21 (i) an appropriate territorial court of 

22 the qualifying territory; or 

23 (ii) a district court of the United 

24 States in the qualifying territory. 


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1 (3) VALUE OF COLLATERAL.—For the purpose 

2 of determining the value of collateral under para3 graph (1)(B), the following shall not be included: 

4 (A) Any proceeds, products, offspring, or 

5 profits of the collateral not in existence on the 

6 date of a discharge under section 101, regard7 less of whether those proceeds, products, off8 spring, or profits of the collateral would become 

9 collateral subject to a security interest after the 

10 date of a discharge under section 101. 

11 (B) Any property acquired or anticipated 

12 to be acquired by a qualifying territory or an 

13 instrumentality of a qualifying territory after 

14 the date of a discharge under section 101, re15 gardless of whether that property, when ac16 quired, would have become collateral subject to 

17 a security interest. 

18 (C) Any contract right to tax revenues that 

19 arise after the date of a discharge under section 

20 101. 

21 SEC. 104. NOTICE OF DISCHARGE. 

22 (a) IN GENERAL.— 

23 (1) RESPONSIBILITIES OF A QUALIFYING TER24 RITORY OR AN INSTRUMENTALITY OF A QUALIFYING


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1 TERRITORY.—After a discharge under section 101, 

2 the qualifying territory shall promptly— 

3 (A) notify the Secretary of the Treasury of 

4 the discharge; 

5 (B) provide actual notice of the discharge 

6 and of the right to bring an action under sec7 tion 103 to— 

8 (i) any known holder of a financial ob9 ligation as of the date of the discharge; 

10 (ii) any known indenture trustee for a 

11 financial obligation as of the date of the 

12 discharge; 

13 (iii) any known agent bank for the 

14 loan, swap, repurchase agreement, or other 

15 derivative of the holder of a financial obli16 gation as of the date of the discharge; and 

17 (iv) any known financial guaranty in18 surer of a financial obligation as of the 

19 date of the discharge; 

20 (C) publish a general notice, in each of the 

21 governmental languages of the qualifying terri22 tory, of the discharge and of the right to bring 

23 an action under section 103 in— 

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1 guage published in the qualifying territory; 

2 and 

3 (ii) not less than 2 daily newspapers 

4 that each have a national circulation and a 

5 general audience; and 

6 (D) publish the general notice described in 

7 subparagraph (C) in the newspapers described 

8 in subparagraph (C) not less than once each 

9 week during the 3-week period beginning on the 

10 date on which that general notice is first pub11 lished. 

12 (2) NOTICE IN THE FEDERAL REGISTER.—On 

13 the date on which the Secretary of the Treasury re14 ceives the notice described in paragraph (1)(A), the 

15 Secretary of the Treasury shall promptly cause to be 

16 published in the Federal Register a notice of that 

17 discharge and of the right to bring an action under 

18 section 103. 

19 (b) ADEQUATE NOTICE.— 

20 (1) HOLDERS OF FINANCIAL OBLIGATIONS.— 

21 (A) IN GENERAL.—A holder of a financial 

22 obligation shall be presumed to have received 

23 adequate notice of a discharge under section 

24 101 if, during the 180-day period beginning on 

25 the date of a discharge under section 101, a 


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1 qualifying territory provides actual notice of the 

2 discharge and of the right to bring an action 

3 under section 103 to— 

4 (i) the holder of the financial obliga5 tion as of the date of the discharge; 

6 (ii) an indenture trustee for the secu7 rity of the holder as of the date of the dis8 charge; or 

9 (iii) an agent bank for the loan, swap, 

10 repurchase agreement, or other derivative 

11 of the holder of a financial obligation as of 

12 the date of the discharge. 

13 (B) REBUTTABLE PRESUMPTION.—The 

14 presumption described in subparagraph (A) 

15 may be rebutted by clear and convincing evi16 dence that the holder of the financial obligation 

17 did not receive adequate evidence. 

18 (2) NOTICE TO A FINANCIAL GUARANTY IN19 SURER.—A financial guaranty insurer shall be con20 clusively deemed to have received adequate notice of 

21 a discharge under section 101 if, during the 180-day 

22 period beginning on the date of a discharge under 

23 section 101, the financial guaranty insurer receives 

24 actual notice of the discharge and of the right to 

25 bring an action under section 103. 


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1 SEC. 105. EFFECTIVE DATE. 

2 This title shall take effect on the date that is 60 days 

3 after the date of enactment of this Act. 

4 TITLE II—PUERTO RICO DEBT 

5 RESTRUCTURING COMPENSA6 TION FUND 

7 SEC. 201. PURPOSE. 

8 Pursuant to clause 1, section 8 of article I and clause 

9 2, section 3 of article IV of the Constitution of the United 

10 States, the purpose of this title is to provide compensation 

11 to certain entities and natural persons that suffer eco12 nomic losses due to a discharge under section 101 of fi13 nancial obligations owed to those entities and natural per14 sons by the Commonwealth of Puerto Rico or an instru15 mentality of the Commonwealth of Puerto Rico. 

16 SEC. 202. DEFINITIONS. 

17 In this title: 

18 (1) COLLATERAL SOURCE COMPENSATION.— 

19 The term ‘‘collateral source compensation’’— 

20 (A) means, on the date of a determination 

21 under section 204(b)(2)(A), compensation that 

22 a claimant has received or is entitled to receive, 

23 from a source other than the Fund, as a result 

24 of the discharge of the debt of the Common25 wealth of Puerto Rico and the instrumentalities 


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1 of the Commonwealth of Puerto Rico under sec2 tion 101; and 

3 (B) includes financial guaranty insurance. 

4 (2) FUND.—The term ‘‘Fund’’ means the Puer5 to Rico Debt Restructuring Compensation Fund es6 tablished under section 205(a). 

7 (3) INELIGIBLE INVESTMENT COMPANY.—The 

8 term ‘‘ineligible investment company’’ means an in9 vestment company, as defined in section 3 of the In10 vestment Company Act of 1940 (15 U.S.C. 80a–3), 

11 that was not registered under section 8 of that Act 

12 (15 U.S.C. 80a–8) on the date on which the invest13 ment company made an investment in a financial ob14 ligation of the Commonwealth of Puerto Rico or an 

15 instrumentality of the Commonwealth of Puerto 

16 Rico. 

17 (4) PUERTO RICO PUBLIC PENSION PLAN.—The 

18 term ‘‘Puerto Rico public pension plan’’ means a 

19 pension system of the government of the Common20 wealth of Puerto Rico;. 

21 (5) SPECIAL MASTER.—The term ‘‘Special Mas22 ter’’ means the Special Master appointed under sec23 tion 203(a). 

24 SEC. 203. ADMINISTRATION. 

25 (a) SPECIAL MASTER.— 


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1 (1) APPOINTMENT.— 

2 (A) IN GENERAL.—Not later than 60 days 

3 after the date of a discharge of the debt of the 

4 Commonwealth of Puerto Rico and the instru5 mentalities of the Commonwealth of Puerto 

6 Rico under section 101, the Chief Justice of the 

7 Supreme Court of the Commonwealth of Puerto 

8 Rico shall appoint a Special Master to admin9 ister the compensation program established 

10 under this title. 

11 (B) DISQUALIFICATION.—A Special Mas12 ter may not have a relationship to a party, at13 torney, action, or court that would require the 

14 disqualification of a judge under section 455 of 

15 title 28, United States Code, unless, after the 

16 date on which the Special Master discloses any 

17 potential ground for disqualification, the party, 

18 attorney, action, or court with which the Special 

19 Master has a relationship, with the approval of 

20 the Chief Justice of the Supreme Court of the 

21 Commonwealth of Puerto Rico, consents to the 

22 appointment of the Special Master. 

23 (2) STATUS.—The Special Master shall be con24 sidered to be an official of the Commonwealth of 

25 Puerto Rico. 


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1 (3) VACANCY.— 

2 (A) IN GENERAL.—In the event of the 

3 death, resignation, incapacity, or other vacancy 

4 in the position of the Special Master, the posi5 tion shall be filled in the manner described in 

6 paragraph (1). 

7 (B) FEDERAL VACANCIES REFORM ACT.— 

8 Sections 3345 through 3349d of title 5, United 

9 States Code (commonly known as the ‘‘Federal 

10 Vacancies Reform Act of 1998’’), shall not 

11 apply to vacancies in the position of Special 

12 Master. 

13 (b) AUTHORIZATION OF APPROPRIATIONS.—There 

14 are authorized to be appropriated such sums as may be 

15 necessary to pay the administrative and support costs for 

16 the Special Master in carrying out this title. 

17 SEC. 204. DETERMINATION OF ELIGIBILITY FOR COM18 PENSATION. 

19 (a) FILING OF CLAIM.— 

20 (1) IN GENERAL.—A claimant may file a claim 

21 for compensation under this title with the Special 

22 Master. The claim shall— 

23 (A) be on the form developed under para24 graph (2); 


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1 (B) state the factual basis, as certified by 

2 the claimant, for eligibility for compensation 

3 and the amount of compensation sought; and 

4 (C) provide evidence that corroborates the 

5 eligibility of the claimant for compensation and 

6 the amount of compensation sought. 

7 (2) CLAIM FORM.— 

8 (A) IN GENERAL.—The Special Master 

9 shall— 

10 (i) develop a claim form that claim11 ants shall use when submitting claims 

12 under paragraph (1); and 

13 (ii) ensure that the form developed 

14 under clause (i) can be filed electronically. 

15 (B) CONTENTS.—The form developed 

16 under subparagraph (A) shall request informa17 tion relating to the claim of the claimant, in18 cluding information relating to— 

19 (i) economic loss that the claimant 

20 suffered as a result of the discharge under 

21 section 101 of the debt of the Common22 wealth of Puerto Rico and the instrumen23 talities of the Commonwealth of Puerto 

24 Rico; 


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1 (ii) collateral source compensation the 

2 claimant has received, or is entitled to re3 ceive, as a result of the discharge described 

4 in clause (i); and 

5 (iii) availability of financial guaranty 

6 insurance coverage to indemnify the claim7 ant. 

8 (C) PENALTY.—A claim submitted on the 

9 form developed under subparagraph (A) shall— 

10 (i) be submitted under penalty of per11 jury; and 

12 (ii) include an attestation by the 

13 claimant that the claimant has not willfully 

14 attempted to evade or defeat the eligibility 

15 restrictions described in subsection (c). 

16 (b) REVIEW AND DETERMINATION.— 

17 (1) REVIEW.—The Special Master shall review 

18 a claim submitted under subsection (a) and deter19 mine— 

20 (A) whether the claimant is an eligible per21 son under subsection (c); 

22 (B) with respect to a claimant determined 

23 to be an eligible person under subsections 

24 (c)(2)(A) and (c)(3)— 


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1 (i) the extent of the economic loss to 

2 the claimant; and 

3 (ii) the amount of compensation to 

4 which the claimant is entitled based on the 

5 economic losses to the claimant, the facts 

6 of the claim, and the individual cir7 cumstances of the claimant, including— 

8 (I) the strength of the ties to the 

9 Commonwealth of Puerto Rico, as de10 fined in regulations promulgated 

11 under section 206, of the claimant; 

12 (II) the financial need, as defined 

13 in regulations promulgated under sec14 tion 206, of the claimant; 

15 (III) the price at which the 

16 claimant obtained that claim against 

17 the Commonwealth of Puerto Rico or 

18 the instrumentality of the Common19 wealth of Puerto Rico; and 

20 (IV) the date on which the claim21 ant obtained the claim against the 

22 Commonwealth of Puerto Rico or the 

23 instrumentality of the Commonwealth 

24 of Puerto Rico; and 


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1 (C) with respect to a claimant determined 

2 to be an eligible person under subsection 

3 (c)(2)(B) and (c)(3)— 

4 (i) the extent of the economic loss to 

5 the claimant; and 

6 (ii) the amount of compensation to 

7 which the claimant is entitled based on the 

8 economic loss to the claimant, the facts of 

9 the claim, and the individual circumstances 

10 of the claimant, including— 

11 (I) the financial need, as defined 

12 in regulations promulgated under sec13 tion 206, of the claimant; 

14 (II) the price at which the claim15 ant obtained that claim against the 

16 Commonwealth of Puerto Rico or the 

17 instrumentality of the Commonwealth 

18 of Puerto Rico; and 

19 (III) the date on which the claim20 ant obtained the claim against the 

21 Commonwealth of Puerto Rico or the 

22 instrumentality of the Commonwealth 

23 of Puerto Rico. 

24 (2) DETERMINATION.— 


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1 (A) IN GENERAL.—Not later than 120 

2 days after the date on which a claim is deter3 mined to be substantially complete by the Spe4 cial Master, the Special Master shall complete 

5 a review, make a determination, and provide 

6 written notice to the claimant, with respect to 

7 the matters that were the subject of the claim 

8 under review. Such a determination shall be 

9 final and not subject to judicial review. 

10 (B) RIGHTS OF CLAIMANTS.— 

11 (i) HEARINGS.—Before the date on 

12 which a determination described in sub13 paragraph (A) is made, a claimant in a re14 view under paragraph (1) shall have the 

15 right to an in-person hearing conducted by 

16 the Special Master. 

17 (ii) WAIVER.—A claimant in a review 

18 under paragraph (1) may waive the right 

19 to a hearing described in clause (i). 

20 (3) COLLATERAL SOURCE COMPENSATION.— 

21 The Special Master shall reduce the amount of com22 pensation determined under paragraph (2) by the 

23 amount of collateral source compensation. 

24 (c) ELIGIBILITY.— 


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1 (1) IN GENERAL.—A claimant shall be deter2 mined to be an eligible person for purposes of this 

3 subsection if the Special Master determines that 

4 such claimant— 

5 (A) is a person described in paragraph (2); 

6 and 

7 (B) meets the requirements of paragraph 

8 (3). 

9 (2) ELIGIBLE PERSONS.— 

10 (A) ELIGIBLE PERSONS IN THE COMMON11 WEALTH OF PUERTO RICO.— 

12 (i) IN GENERAL.—A claimant is a 

13 person described in this subparagraph if 

14 the claimant is— 

15 (I) a natural person who— 

16 (aa) was domiciled in the 

17 Commonwealth of Puerto Rico 

18 and was a citizen or lawful per19 manent resident of the United 

20 States on September 20, 2017, 

21 regardless of whether that nat22 ural person was physically 

23 present in the Commonwealth of 

24 Puerto Rico at that time; 


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1 (bb) is a beneficial owner of 

2 a security issued by the Com3 monwealth of Puerto Rico or an 

4 instrumentality of the Common5 wealth of Puerto Rico; and 

6 (cc) became a beneficial 

7 owner of the security described in 

8 item (bb) not later than Sep9 tember 20, 2017; 

10 (II) a bank or credit union that 

11 did business solely in the Common12 wealth of Puerto Rico on September 

13 20, 2017; 

14 (III) a worker association or 

15 workplace association in the Common16 wealth of Puerto Rico; 

17 (IV) a Puerto Rico public pen18 sion plan; 

19 (V) a business, of which the prin20 cipal place of business was in the 

21 Commonwealth of Puerto Rico on 

22 September 20, 2017; or 

23 (VI) subject to clause (ii), any 

24 other person that the Special Master 

25 determines is an eligible person. 


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1 (ii) EXCLUSIONS.—A claimant is not 

2 a person described in this subparagraph if 

3 the claimant is— 

4 (I) an ineligible investment com5 pany; 

6 (II) a financial guaranty insurer; 

7 (III) as defined in section 101 of 

8 title 11, United States Code— 

9 (aa) a party to a master net10 ting agreement; 

11 (bb) a party to a repurchase 

12 agreement; or 

13 (cc) a party to a swap agree14 ment; 

15 (IV) any other financial institu16 tion with total consolidated assets 

17 greater than $2,000,000,000; 

18 (V) a person that owns a share 

19 in an unregistered investment fund 

20 that owns a security issued by the 

21 Commonwealth of Puerto Rico or an 

22 instrumentality of the Commonwealth 

23 of Puerto Rico; 

24 (VI) a person that acquired a 

25 claim against the Commonwealth of 


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1 Puerto Rico or an instrumentality of 

2 the Commonwealth of Puerto Rico 

3 during the period beginning on the 

4 date that is 180 days before the date 

5 of a discharge under section 101, un6 less that claim was acquired through 

7 devise, descent, or a divorce settle8 ment; 

9 (VII) the Special Master; or 

10 (VIII) any other person that the 

11 Special Master determines is not an 

12 eligible person. 

13 (B) ELIGIBLE PERSONS NOT IN PUERTO

14 RICO.— 

15 (i) IN GENERAL.—A claimant is a 

16 person described in this subparagraph if 

17 the claimant was not domiciled in the 

18 Commonwealth of Puerto Rico on Sep19 tember 20, 2017, and the claimant is— 

20 (I) a worker association or work21 place association; 

22 (II) a pension plan; 

23 (III) a natural person who— 

24 (aa) is a beneficial owner of 

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1 monwealth of Puerto Rico or an 

2 instrumentality of the Common3 wealth of Puerto Rico; and 

4 (bb) became a beneficial 

5 owner of that security not later 

6 than September 20, 2017; 

7 (IV) subject to clause (iii), an 

8 open-end mutual fund; or 

9 (V) subject to clause (ii), any 

10 other person that the Special Master 

11 determines is an eligible person. 

12 (ii) EXCLUSIONS.—A claimant is not 

13 a person described in this subparagraph if 

14 the claimant was not domiciled in the 

15 Commonwealth of Puerto Rico on Sep16 tember 20, 2017, and the claimant is— 

17 (I) an ineligible investment com18 pany; 

19 (II) a closed-end company, as de20 fined in section 5 of the Investment 

21 Company Act of 1940 (15 U.S.C. 

22 80a–5); 

23 (III) a financial guaranty in24 surer; 


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1 (IV) as defined in section 101 of 

2 title 11, United States Code— 

3 (aa) a party to a master net4 ting agreement; 

5 (bb) a party to a repurchase 

6 agreement; or 

7 (cc) a party to a swap agree8 ment; 

9 (V) any other financial institu10 tion with total consolidated assets 

11 greater than $2,000,000,000; 

12 (VI) a person that owns a share 

13 in an unregistered investment fund 

14 that owns a security issued by the 

15 Commonwealth of Puerto Rico or an 

16 instrumentality of the Commonwealth 

17 of Puerto Rico; 

18 (VII) a person that acquired a 

19 claim against the Commonwealth of 

20 Puerto Rico or an instrumentality of 

21 the Commonwealth of Puerto Rico 

22 during the period beginning on the 

23 date that is 180 days before the date 

24 of a discharge under section 101, un25 less that claim was acquired through 


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1 devise, descent, or a divorce settle2 ment; 

3 (VIII) the Special Master; or 

4 (IX) any other person that the 

5 Special Master determines is not an 

6 eligible person. 

7 (iii) ELIGIBILITY OF OPEN-END MU8 TUAL FUNDS.—A claimant that is an open9 end mutual fund is not an eligible person 

10 described in this subparagraph unless the 

11 manager of that open-end mutual fund 

12 pledges to waive the fee of that manager 

13 for any compensation the open-end mutual 

14 fund receives under this title. 

15 (3) REQUIREMENTS FOR BENEFICIAL OWNERS

16 OF SECURITIES.—A person that is beneficial owner 

17 of a security issued by the Commonwealth of Puerto 

18 Rico or an instrumentality of the Commonwealth of 

19 Puerto Rico may file a claim under subsection (a) if 

20 the person, as of the date on which the claim is 

21 filed— 

22 (A) has continuously held that security 

23 during the period beginning on September 19, 

24 2017, and ending on the date on which the 

25 claim is filed; and 


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1 (B) the claim is submitted not later than 

2 180 days after the date of a discharge of the 

3 debt of the Commonwealth of Puerto Rico and 

4 the instrumentalities of the Commonwealth of 

5 Puerto Rico under section 101. 

6 (d) COMPENSATION.— 

7 (1) IN GENERAL.—A claimant may not receive 

8 compensation under this title if that claimant is not 

9 determined to be an eligible person under this sub10 section. 

11 (2) LIMITATIONS.— 

12 (A) IN GENERAL.—A claimant may not re13 ceive compensation under this title that exceeds 

14 the amount of the claim filed by the claimant 

15 under subsection (a), or seek or receive com16 pensation for a debt described in section 

17 2(5)(B)(ii), which— 

18 (i) shall not be discharged; and 

19 (ii) shall be repaid in full as provided 

20 by section 101(b). 

21 (B) ASSIGNED CLAIMS.—In the case of a 

22 claim that was assigned to a claimant, the 

23 claimant may not receive compensation under 

24 this title for that claim that exceeds the amount 


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1 paid by the claimant for the assignment of that 

2 claim. 

3 SEC. 205. PUERTO RICO DEBT RESTRUCTURING COM4 PENSATION FUND. 

5 (a) IN GENERAL.—On the date of a discharge of the 

6 debt of the Commonwealth of Puerto Rico and the instru7 mentalities of the Commonwealth of Puerto Rico under 

8 section 101, there is established in the Treasury of the 

9 United States a fund to be known as the ‘‘Puerto Rico 

10 Debt Restructuring Compensation Fund’’, consisting of 

11 amounts appropriated into the Fund under subsection (b). 

12 (b) APPROPRIATION.— 

13 (1) IN GENERAL.—There is appropriated to the 

14 Fund, out of any funds in the Treasury of the 

15 United States not otherwise appropriated, 

16 $15,000,000,000, which shall be available without 

17 further appropriation to the Special Master to pro18 vide compensation for claims of eligible persons 

19 under this title. 

20 (2) EMERGENCY DESIGNATION.— 

21 (A) IN GENERAL.—The amount necessary 

22 to carry out this Act is designated by Congress 

23 as being for emergency requirements pursuant 

24 to section 251(b)(2)(A)(i) of the Balanced 


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1 Budget and Emergency Deficit Control Act of 

2 1985 (2 U.S.C. 901(b)(2)(A)(i)). 

3 (B) PAYGO.— 

4 (i) IN GENERAL.—This Act is des5 ignated as an emergency requirement pur6 suant to section 4(g) of the Statutory Pay7 As-You-Go Act of 2010 (2 U.S.C. 933(g)). 

8 (ii) DESIGNATION IN SENATE.—In the 

9 Senate, this Act is designated as an emer10 gency requirement pursuant to section 

11 403(a) of Senate Concurrent Resolution 

12 13, 111th Congress, agreed to April 29, 

13 2009. 

14 (c) DISTRIBUTION.— 

15 (1) IN GENERAL.—Of the amounts appro16 priated into the Fund under subsection (b)— 

17 (A) 50 percent shall be made available to 

18 pay claims of eligible persons described in sec19 tion 204(c)(2)(A); and 

20 (B) 50 percent shall be made available to 

21 pay claims of eligible persons described in sec22 tion 204(c)(2)(B). 

23 (2) CLAIMS EXCEEDING APPROPRIATED

24 AMOUNTS.—If the claims of eligible persons de25 scribed in section 204(c)(2)(A) or of eligible persons 


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1 described in section 204(c)(2)(B) exceed the 

2 amounts appropriated to pay those respective claims 

3 under paragraph (1), any claim of an eligible person 

4 within that respective category shall be reduced on 

5 a pro rata basis. 

6 (3) DATE OF DISTRIBUTION.—For the purpose 

7 of reducing claims under paragraph (2), the Special 

8 Master shall determine a date on which all claims of 

9 eligible persons shall be paid. 

10 (d) UNOBLIGATED FUNDS.—Any amounts made 

11 available under subsection (b) that are not obligated by 

12 the Special Master as of the date that is 36 months after 

13 the date of enactment of this Act shall be returned to the 

14 Treasury of the United States. 

15 SEC. 206. REGULATIONS. 

16 (a) IN GENERAL.—The Special Master shall promul17 gate regulations, through notice and comment rulemaking 

18 in compliance with section 553 of title 5, United States 

19 Code, to carry out this title. 

20 (b) NOTICE OF PROPOSED RULEMAKING.—Not later 

21 than 60 days after the date on which the Special Master 

22 is appointed under section 203(a), the Special Master 

23 shall publish a notice of proposed rulemaking in the Fed24 eral Register. 


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1 (c) FINAL RULE.—Not later than 60 days after the 

2 date on which the notice of proposed rulemaking described 

3 in subsection (b) is published, the Special Master shall 

4 promulgate final regulations to carry out this title. 

5 (d) VACANCY IN THE POSITION OF SPECIAL MAS6 TER.—If promulgation of regulations under this section 

7 is completed before the date on which a Special Master 

8 is appointed under section 203(a)(3)(A), that Special 

9 Master is not required to promulgate new regulations 

10 under this section. 

11 SEC. 207. SUNSET. 

12 The provisions of this title shall be effective for the 

13 period beginning on the date of enactment of this Act and 

14 ending on the date that is 36 months after the date of 

15 enactment of this Act. 

16 TITLE III—PUERTO RICO PUBLIC 

17 CREDIT COMPREHENSIVE 

18 AUDIT COMMISSION 

19 SEC. 301. DEFINITIONS. 

20 In this title: 

21 (1) COMPREHENSIVE AUDIT.—The term ‘‘com22 prehensive audit’’ means a supervisory action taken 

23 to examine and evaluate the public debt contracting, 

24 refinancing, or renegotiation process, the source and 

25 intended use of resources, and the implementation of 


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1 programs and projects financed with domestic or 

2 foreign debt, in order to determine the legitimacy, 

3 lawfulness, transparency, quality, efficacy, and effi4 ciency thereof, considering legal and financial as5 pects, and the economic, social, gender, regional, ec6 ological, national, and municipal impact thereof. 

7 (2) COMMISSION.—The term ‘‘Commission’’ 

8 means the Puerto Rico Public Credit Comprehensive 

9 Audit Commission established under section 302. 

10 (3) CREDIT REQUEST.—The term ‘‘credit re11 quest’’ means request or application for credit by the 

12 Commonwealth of Puerto Rico, or any instrumen13 tality of the Commonwealth of Puerto Rico, to ob14 tain credit from a government or a banking or mul15 tilateral financial system in the domestic or foreign 

16 private sector, including any agreement, contract, or 

17 other form or method relating to that request or ap18 plication. 

19 SEC. 302. ESTABLISHMENT; DISSOLUTION. 

20 (a) ESTABLISHMENT.—There is established an inde21 pendent commission to be known as the Puerto Rico Pub22 lic Credit Comprehensive Audit Commission. 

23 (b) DISSOLUTION.—The Commission shall only be 

24 dissolved after the Commission completes or fulfills each 


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1 duty of the Commission under section 304 and issues the 

2 final report of the Commission under section 303(b). 

3 SEC. 303. REPORTS. 

4 (a) IN GENERAL.—Not later than 1 year after the 

5 date of enactment of this Act, and not later than every 

6 180 days thereafter, the Commission shall make publicly 

7 available a report describing the progress of the Commis8 sion in carrying out the duties of the Commission under 

9 section 304 as of the date on which the report is released. 

10 (b) FINAL REPORT.—Upon completing the duties of 

11 the Commission under section 304, the Commission shall 

12 make publicly available and submit to the Legislative As13 sembly of the Commonwealth of Puerto Rico and the Gov14 ernor of the Commonwealth of Puerto Rico the final report 

15 of the Commission, which shall state in detail the findings, 

16 conclusions, and recommendations of the Commission re17 lating to the duties of the Commission carried out under 

18 section 304. 

19 SEC. 304. DUTIES. 

20 (a) IN GENERAL.—The Commission shall carry out 

21 the duties described in subsections (b) and (c). 

22 (b) COMPREHENSIVE AUDIT.— 

23 (1) IN GENERAL.—The Commission shall con24 duct a comprehensive audit of all public debt of the 

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1 riod beginning on the first day of fiscal year 1972 

2 and ending on the date of enactment of this Act, 

3 which shall include an audit of agreements, con4 tracts, and other forms or methods employed by the 

5 Commonwealth of Puerto Rico and any instrumen6 tality thereof to obtain credit from governments, 

7 banking or multilateral financial system institutions, 

8 and the domestic or foreign private sector. 

9 (2) CRITERIA.—In order to conduct the com10 prehensive audit under paragraph (1), the Commis11 sion shall establish criteria to be used in evaluating 

12 each credit request that shall include, with respect 

13 to each credit request— 

14 (A) any precedent, study, technical, eco15 nomic, financial, or social viability score, or 

16 other supporting document that supported the 

17 credit request at the time the credit request was 

18 made; 

19 (B) the amount of the credit requested in 

20 the credit request; 

21 (C) the currency unit in which the credit 

22 was obtained through the credit request; 

23 (D) the total amount of any subsequent in24 crease or extension of credit from the original 


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1 amount of credit obtained through the credit re2 quest; 

3 (E) the economic, financial, and business 

4 conditions agreed upon under the credit re5 quest; 

6 (F) the economic, financial, and business 

7 conditions effectively applied under the credit 

8 request; 

9 (G) any condition contained in the credit 

10 request; 

11 (H) the intended and actual use of any re12 sources funded by the credit request; 

13 (I) the total impact of any project funded 

14 by the credit request; 

15 (J) the name of each individual who, on 

16 behalf of any party to the credit request, trans17 acted or executed the credit request; 

18 (K) each method or mechanism used to 

19 meet any obligation agreed to under the credit 

20 request; and 

21 (L) any other circumstance or information 

22 determined by the Commission to be pertinent 

23 in determining the legitimacy, lawfulness, trans24 parency, quality, efficacy, and efficiency of each 

25 credit request, considering— 


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1 (i) the legal and financial aspects of 

2 the credit request; and 

3 (ii) the economic, social, gender, re4 gional, ecological, national, and municipal 

5 impact of the credit request. 

6 (c) DATA TRANSPARENCY DATABASE.—The Com7 mission shall establish and maintain a publicly available 

8 data transparency database that shall contain any infor9 mation relating to any public, private, domestic, or foreign 

10 debt held by a public institution of the Commonwealth of 

11 Puerto Rico collected through the comprehensive audit 

12 under subsection (b). 

13 SEC. 305. AUTHORITY OF THE COMMISSION. 

14 In order to carry out the duties described in section 

15 304, the Commission— 

16 (1) may audit, and ensure the transparency of, 

17 the indebtedness process of the Commonwealth of 

18 Puerto Rico and each instrumentality of the Com19 monwealth of Puerto Rico; and 

20 (2) shall have primary jurisdiction to intervene, 

21 have knowledge of, and conduct, on the initiative of 

22 the Commission, any investigation on any matter or 

23 dispute relating to any indebtedness process de24 scribed in paragraph (1). 


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1 SEC. 306. MEMBERSHIP. 

2 (a) IN GENERAL.—The Commission shall be com3 posed of— 

4 (1) an individual who— 

5 (A) not later than 180 days after the date 

6 of enactment of this Act, except as provided in 

7 subsection (e), shall be selected by the board of 

8 directors of the Puerto Rico Institute of Statis9 tics from a list of candidates submitted to the 

10 board of directors by scientific associations and 

11 other relevant professional groups in the Com12 monwealth of Puerto Rico; 

13 (B) has demonstrated expertise and ad14 vanced academic preparation in— 

15 (i) statistics; 

16 (ii) economics; or 

17 (iii) government planning; and 

18 (C)(i) during the 5-year period ending on 

19 the date on which the individual is selected 

20 under subparagraph (A), has not— 

21 (I) held an elected public office in the 

22 Commonwealth of Puerto Rico; or 

23 (II) made any financial contribution 

24 to, or participated in, any political cam25 paign relating to the Commonwealth of 

26 Puerto Rico; and 


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1 (ii) does not have any other direct political 

2 connection to the government of the Common3 wealth of Puerto Rico; and 

4 (2) the following individuals, who shall be ap5 pointed not later than 180 days after the date of en6 actment of this Act by the Governor of the Common7 wealth of Puerto Rico to serve on the Commission: 

8 (A) One representative of each parliamen9 tary majority in the Legislative Assembly. 

10 (B) One representative of each parliamen11 tary minority in the Legislative Assembly. 

12 (C) One professor of economics from any 

13 public higher education institution located in 

14 the Commonwealth of Puerto Rico. 

15 (D) One professor of finance from any 

16 public higher education institution located in 

17 the Commonwealth of Puerto Rico. 

18 (E) One professor of accounting from any 

19 public higher education institution located in 

20 the Commonwealth of Puerto Rico. 

21 (F) One professor of statistics from any 

22 public higher education institution located in 

23 the Commonwealth of Puerto Rico. 


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1 (G) One professor of law from any public 

2 higher education institution located in the Com3 monwealth of Puerto Rico. 

4 (H) One representative of the labor union 

5 sector in the Commonwealth of Puerto Rico. 

6 (I) One representative of the business com7 munity in the Commonwealth of Puerto Rico, 

8 with preference given to a representative from 

9 a small- or medium-sized business located in 

10 the Commonwealth of Puerto Rico. 

11 (J) One representative of the cooperative 

12 sector in the Commonwealth of Puerto Rico. 

13 (K) One professor of sociology from any 

14 public higher education institution who has 

15 published work in 1 or more peer-reviewed jour16 nals that indicates expertise in data relating to 

17 Puerto Rico. 

18 (L) One individual who is a translator or 

19 interpreter of English and Spanish. 

20 (b) CHAIRPERSON.— 

21 (1) IN GENERAL.—After each of the members 

22 of the Commission are appointed under subsection 

23 (a), the members of the Commission shall elect from 

24 among the members of the Commission 1 individual 

25 to serve as the Chairperson of the Commission. 


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1 (2) DUTIES.—The Chairperson of the Commis2 sion shall— 

3 (A) call and preside over meetings of the 

4 Commission; and 

5 (B) be the legal representative of the Com6 mission. 

7 (3) TIE VOTE.—In the case of a tie vote among 

8 the members of the Commission, the vote of the 

9 Chairperson shall be determinative. 

10 (c) PERIOD OF APPOINTMENT.—Members of the 

11 Commission shall be appointed for the life of the Commis12 sion. 

13 (d) VACANCIES.—Any vacancy in the Commission 

14 shall not affect the powers of the Commission but shall 

15 be filled in the same manner as the original appointment 

16 or election. 

17 (e) MEMBER OF THE COMMISSION SELECTED BY

18 THE PUERTO RICO INSTITUTE OF STATISTICS.—If, on the 

19 date of enactment of this Act, the Puerto Rico Institute 

20 of Statistics has been disbanded or reorganized to be a 

21 part of another government department of the Common22 wealth of Puerto Rico, the individual described in sub23 section (a)(1) shall be selected by President of the Senate 

24 of the Commonwealth of Puerto Rico and the Speaker of 

25 the House of Representatives of Puerto Rico. 


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1 (f) FAILURE TO APPOINT COMMISSION MEMBERS.— 

2 If the Governor of the Commonwealth of Puerto Rico fails 

3 to appoint any member of the Commission described under 

4 subsection (a)(2) during the period described in that sub5 section, not later than 180 days after the expiration of 

6 that period, the President of the Senate of the Common7 wealth of Puerto Rico and the Speaker of the House of 

8 Representatives of the Commonwealth of Puerto Rico shall 

9 jointly appoint any member that has not been appointed. 

10 SEC. 307. POWERS AND RESPONSIBILITIES. 

11 To carry out the duties of the Commission under sec12 tion 304, the Commission shall— 

13 (1) adopt internal bylaws as appropriate for the 

14 proper operations and fulfillment of the objectives of 

15 the Commission; 

16 (2) define and propose to the Secretary of the 

17 Treasury the hiring of staff to conduct audits in ac18 cordance with the rules and administrative proce19 dures set forth by the laws of the Commonwealth of 

20 Puerto Rico relating to technical audits; 

21 (3) designate and hire a minimum number of 

22 regular personnel required to carry out the duties 

23 and fulfill the objectives of the Commission; 

24 (4) read reports relating to the audit processes 

25 and other studies that have been entrusted to comVerDate Sep 11 2014 04:15 May 10, 2019 Jkt 089200 PO 00000 Frm 00053 Fmt 6652 Sfmt 6201 E:\BILLS\H2526.IH H2526

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1 missions and technical units relating to audits of 

2 public debt; 

3 (5) review and approve the annual budget and 

4 operational plan of the Commission based on those 

5 devised by the Director of the Office of Management 

6 and Budget; 

7 (6) as appropriate, request technical support 

8 from any public institution, including by, as nec9 essary, through the request for the transfer, on a 

10 temporary assignment, of any technical personnel re11 quired to carry out a specific program of the Com12 mission after stating the length of the period for 

13 which the transfer will be required; 

14 (7) hold— 

15 (A) a regular meeting not less than twice 

16 each month; and 

17 (B) a special meeting upon the request of 

18 not less than 3 of the members of the Commis19 sion; 

20 (8) access the information necessary to dis21 charge the duties of the Commission; 

22 (9) file with the Legislative Assembly of the 

23 Commonwealth of Puerto Rico and the Governor of 

24 the Commonwealth of Puerto Rico periodic reports 

25 stating achievements of the Commission in carrying 


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1 out the duties of the Commission under section 304, 

2 which shall include any recommendation or sugges3 tion that the Commission determines to be pertinent, 

4 including any relevant recommendation of the Com5 mission relating to the commencement of any appro6 priate administrative, civil, or criminal action relat7 ing to the findings of the Commission; and 

8 (10) propose rules and policies relating to 

9 strengthening the procedures relating to audits of 

10 public debt as a permanent duty of the Common11 wealth of Puerto Rico. 

12 SEC. 308. PROVISION OF REQUESTED INFORMATION. 

13 (a) IN GENERAL.—Each entity, official, or former of14 ficial of the Commonwealth of Puerto Rico shall provide 

15 any information requested by the Commission in carrying 

16 out the duties of the Commission under section 304 by 

17 summons or as required by law. 

18 (b) ORDER TO COMPLY.—Any entity, official, or 

19 former official described in subsection (a) that does not 

20 obey a summons or request of the Commission for infor21 mation required by the Commission to carry out the duties 

22 of the Commission under section 304, the appropriate dis23 trict court of the Commonwealth of Puerto Rico shall, on 

24 the request of the Commission, issue an order compelling 


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1 that entity, official, or former official to produce the re2 quested information, as appropriate. 

3 (c) CONTEMPT.—Any entity, official, or former offi4 cial described in subsection (a) that does not comply with 

5 an order of the court under subsection (b) shall be held 

6 in contempt for failing to obey that order. 

7 SEC. 309. ACCESS TO INFORMATION. 

8 (a) PUBLIC DOCUMENTS.— 

9 (1) IN GENERAL.—Any document, record, or in10 formation relating to the public debt of the Com11 monwealth of Puerto Rico, including any document 

12 relating to any public offering, contract, agreement, 

13 order, or report detailing how funds obtained are 

14 spent, or contract or agreements with a creditor of 

15 the Commonwealth of Puerto Rico, shall be— 

16 (A) classified as a public document; and 

17 (B) made accessible to any interested 

18 party. 

19 (2) CONFIDENTIALITY.—Any claim of confiden20 tiality relating to information described in paragraph 

21 (1) by any person, including any entity, official, or 

22 former official of the Commonwealth of Puerto Rico, 

23 shall be construed narrowly and in favor of pro24 moting transparency and the right of the public to 

25 that information. 


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1 (b) CONFIDENTIAL INFORMATION.— 

2 (1) IN GENERAL.—The Commission shall have 

3 the authority to obtain confidential information nec4 essary to carry out the duties of the Commission 

5 under section 304. 

6 (2) CONFIDENTIALITY.—The Commission shall 

7 keep any information described under subsection (a) 

8 confidential as required under the Constitution of 

9 the Commonwealth of Puerto Rico. 

10 (c) RULE OF CONSTRUCTION.—Nothing in this title 

11 shall be construed to grant any special power to the Com12 mission to conceal information from the public based on 

13 any rule relating to confidentiality. This title shall be in14 terpreted broadly to favor the right of the public to infor15 mation relating to the activities of the Commission. 

16 SEC. 310. FUNDING. 

17 The Legislative Assembly of the Commonwealth of 

18 Puerto Rico shall provide the Commission with sufficient 

19 funds to carry out the duties of the Commission under 

20 section 304, including funds to pay fair compensation to 

21 members and staff of the Commission, based on the an22 nual budget prepared for the Commission by the Office 

23 of Management and Budget, which shall be included in 

24 the general budget of the Commonwealth of Puerto Rico. 


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1 TITLE IV—SEVERABILITY 

2 SEC. 401. SEVERABILITY. 

3 If any provision of this Act or the application of such 

4 provision to any person or circumstance is held to be in5 valid or unconstitutional, the remainder of this Act and 

6 the application of the provisions of this Act to any person 

7 or circumstance shall remain and shall not be affected 

8 thereby. 

Æ 


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