Puerto Rico Gov. Ricardo Rossell- is seeking the extension of a stay on Puerto Rico debt-related lawsuits to Dec. 31 from May 1.
Rossell- made the request to extend the stay till the end of the year in his fiscal plan, released Wednesday, in a move that drew objections from bondholder groups.
The Puerto Rico Oversight, Management and Economic Stability Act set the stay on debt-related suits against the commonwealth at Feb. 15, allowing the Oversight Board the option of moving it to May 1, which it did on Jan. 28.
In the plan, Rossell- argued that it was reasonable to ask for an extension because the previous gubernatorial administration failed to use its time in office after PROMESA passed to seek a negotiated debt restructuring. He said the extension will allow his administration time to release fiscal year 2015 and 2016 financial information.
The Ad Hoc Group of Puerto Rico General Obligation Bondholders on Thursday released a statement opposed to any extension:
"The commonwealth's request of Congress for an extension of the stay on litigation undercuts its professed commitment to a consensual process, and if granted, would allow [the commonwealth] to delay negotiating with creditors. This is the opposite of what Congress intended when it passed PROMESA in the first place.
"We remain ready and willing to be partners with the commonwealth on a deal that respects Puerto Rico's constitution and provides for its future growth," the group said.
Sources close to a group advocating for holders of COFINA Senior bonds said that group also opposes the extension.
According to a press statement from the governor's office on Feb. 21, U.S. Rep. Sean Duffy told Rossell- that Duffy is available to amend PROMESA to ensure that the board treats Puerto Rico fairly. Duffy hasn't responded to a request for comment.
