Washington Post

Puerto Rico exits bankruptcy after U.S. judge approves multibillion-dollar restructuring plan

A federal judge on Tuesday approved a plan to restructure billions of dollars of Puerto Rico's debt, allowing the U.S. territory to exit bankruptcy following a years-long string of litigation that racked up nearly $1 billion in legal and administrative costs.

The plan, put forth by a bipartisan oversight board established as part of the 2016 Puerto Rico Oversight, Management and Economic Stability Act - "Promesa," or "promise" in Spanish - was approved by Judge Laura Taylor Swain of the U.S. District Court for the Southern District of New York, who has overseen Puerto Rico's bankruptcy proceedings.

The restructuring reduces $33 billion of the territory's debt by 80%, according to the Financial Oversight and Management Board for Puerto Rico, whose seven members are presidential appointees. (Democratic Puerto Rico Gov. Pedro Pierluisi's office also gives him a seat.) Puerto Rico had entered bankruptcy with more than $72 billion in debt, with an additional $55 billion owed in unfunded pensions. Under pressure from civil service unions, the board agreed in October to remove cuts to pension plans from the restructuring agreement...

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