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Congressional Hearing on Puerto Rico’s Energy Issues to take Place Jan. 12

By on January 5, 2016

The U.S. House Energy & Mineral Resources Subcommittee, chaired by Rep. Doug Lamborn (R.,Co.), will hold an oversight hearing Jan. 12 on the “energy challenges and opportunities facing Puerto Rico,” the committee confirmed Tuesday.

It is expected to be the first of two hearings to be held this month by the subcommittee over the Puerto Rico issue, after a recent Reuters report indicated another one would take place during the week of Jan. 24.

Among those who will participate in the Jan. 12 hearing is Resident Commissioner Pedro Pierluisi, who confirmed Tuesday he has been invited to take part, even though he is not a member of the subcommittee.

“In the hearing, I hope to be able to question the witnesses, who have not yet been publicly announced. I also want to thank the subcommittee, which has welcomed my recommendations on potential witnesses,” Pierluisi stated.

After noting the high cost of electricity Puerto Rico’s residents and businesses face, the resident commissioner wants to ask participants on possible ways to reduce the island’s energy costs and oil dependency. “It is also clear that the Puerto Rico Electric Power Authority must be reformed and its infrastructure — both plants and transmission lines — should be much more cost-efficient,” he further stated.     

While other Congressional committees are expected to follow suit in scheduling hearings to address the island’s fiscal and economic crisis, no other ones have been confirmed as of this writing.

The commonwealth government is set to resume this month its lobbying efforts on Capitol Hill aimed at securing access to Chapter 9 of the U.S. Bankruptcy Code, which would allow Puerto Rico to restructure more than $20 billion of debt held by its public corporations. The island’s total public debt towers at more than $70 billion not including roughly $40 billion in liabilities under its underfunded pension funds.

Several Puerto Rico-related bills, including those seeking access to Chapter 9, failed to secure passage before Congress left for the holiday break. House Speaker Paul Ryan (R.,Wis.) has said the lower chamber would move on the Puerto Rico issue once it reconvenes in January, in a bid to have a final solution before the end of March.  

Although meeting on Jan. 4 most of its more than $850 million due in debt-service payments across several credits, the commonwealth defaulted on $36 million corresponding to the Infrastructure Financing Authority (Prifa) — the second time Puerto Rico has done so during fiscal year 2016, after failing to meet debt obligations under the Public Financing Corp.

The commonwealth government is banking on Congressional action, particularly over Chapter 9 access, during the first semester of the new year, as it tries to avoid additional defaults amid a debt-service schedule that becomes steeper during the summer. The commonwealth faces more than $1.5 billion in payments July 1, the first day of fiscal 2017.

Photo:  The Capitol dome is seen on Capitol Hill. (AP Photo/Alex Brandon, File)

By Luis J. Valentín

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