Puerto Rico plan voting extended by two weeks

Puerto Rico bankruptcy Judge Laura Taylor Swain extended the deadline for voting on the proposed Puerto Rico Plan of Adjustment by two weeks after several parties saw delays in receiving the ballots.

Swain filed the order granting the requested extension on Monday afternoon in the U.S. District Court for Puerto Rico, which is hearing the bankruptcy.

Swain moved the deadline for submitting votes to 5 p.m. Atlantic Standard Time, Oct. 18, from 5 p.m. Atlantic Standard Time, Oct. 4. Voters from all classes — bondholders, other creditors, pensioners, and government workers entitled to pensions — are affected by the deadline extension.

Swain also extended the deadline for the tabulation of the votes to Nov. 3 from Oct. 25. She left unchanged the start of the Plan Confirmation Hearing, which is scheduled for Nov. 8.

On Sept. 23 the Official Committee or Retired Employees filed a motion requesting Swain postpone the deadline by two weeks. In the next few days, the Unsecured Creditors Committee and bondholder Peter Hein filed similar motions.

The retirees and the UCC said many of their members had not received the solicitation package that included information about the Plan of Adjustment and how to vote. Hein said he received a package but that it was incomplete.

In her ruling Swain rejected other requests made by Hein in his petition concerning the solicitation package “without prejudice.” This means she will allow him to reintroduce those claims separately.

On Monday, The Puerto Rico Oversight Board announced concessions to win local government support for a debt deal but the president of the Puerto Rico Senate said he wanted more. The board wants the local government to pass legislation associated with the Plan of Adjustment or possibly a modified Plan of Adjustment.

The Plan of Adjustment covers $33 billion of bonds and other debt (excluding its coverage of pensions). It covers General Obligation, Public Building Authority, Employees Retirement System, Highways and Transportation Authority, Public Finance Corp., Puerto Rico Infrastructure Finance Authority, Convention Center District Authority, and Metropolitan Bus Authority bonds.

If the plan were to be adopted, the Commonwealth of Puerto Rico central government would be left with $7 billion of debt (excluding the Puerto Rico Sales Tax Financing Corp., COFINA, debt).

As part of the plan there would be an $8.75 billion cash payout to creditors. Of this, about $7.77 billion would go to bondholders.