Puerto Rico draft rescue bill guided by U.S. bankruptcy rulesWASHINGTON/SAN JUAN (Reuters) - A U.S. congressional draft bill to steer Puerto Rico through its economic crisis was released on Tuesday with elements of U.S. bankruptcy law opposed by creditors who want to keep the island’s debt talks out of court. The draft, circulated by the U.S. House of Representatives Committee on Natural Resources, includes sections of the U.S. Bankruptcy Code that allow bankrupt entities under certain circumstances to force creditors to take reduced payouts. An official draft of the bill is expected to be released on April 11 after a public comment period. Puerto Rico has $70 billion in debt, with major bond payments due in coming months. It also has an unfunded state pension liability of nearly $44 billion. The bill “provides Puerto Rico with tools to impose discipline over its finances, meet its obligations and restore confidence in its institutions,” Utah Republican Rob Bishop, the committee’s chairman, said in a statement. “We appreciate the constructive efforts by Chairman Bishop and the House Natural Resources Committee to begin drafting legislation to address Puerto Rico’s fiscal and economic crisis. But the current draft needs improvements,” said a statement from a Treasury spokesperson. “Final legislation must provide Puerto Rico with tools to achieve a lasting, workable solution to this crisis and create a path to recovery for the people of Puerto Rico.” The Republican-led panel’s bill would create a federal board to oversee the island’s finances, monitor its accounting and help curb spending. It would also require Puerto Rico to make efforts to restructure debt consensually with creditors.  If those talks failed, the island or its public entities could file for a court-supervised debt restructuring process based on key statutes within U.S. bankruptcy law. That would allow Puerto Rico to force such deals on holdout creditors. The bill’s elements were unexpected because creditors and House Republicans had largely opposed bankruptcy for Puerto Rico. The Natural Resources Committee had said that “retroactively adding territories” like Puerto Rico to the federal bankruptcy code “is ill-conceived and would undermine the rule of law.” A congressional aide stressed that the draft legislation was not a bankruptcy law, and does not directly add Puerto Rico to U.S. bankruptcy code, though it follows similar language. The Obama Administration has advocated to allow Puerto Rico to restructure its debt in a court-sanctioned process. House Minority Leader Nancy Pelosi criticized the “sweeping powers of the oversight board proposed” in the bill. The bill in its final form may include language that protects an existing consensual restructuring deal between creditors and the power utility, PREPA, the congressional aide said. PREPA earlier this year reached the deal with creditors holding roughly 70 percent of its $8.3 billion in debt. “The bill in its current form is fiscally irresponsible,” financial adviser Stephen Spencer of Houlihan Lokey said in an emailed statement. The company’s clients include major Puerto Rico creditors such as OppenheimerFunds and Franklin Advisers. “As we showed with the PREPA deal, fair solutions can be reached between Puerto Rico and its creditors that benefit all stakeholders. However, the Discussion Draft Bill is worse for creditors than Chapter 9,” Spencer said. How the oversight board treats the island’s General Obligation bonds, which is typically regarded as the most senior debt, versus pension payments is also a source of concern for creditors. The oversight board will look at each bond issued and make a determination on how it relates to other creditors under the existing law, the congressional aide said. If the GO bonds are constitutionally protected and within their limits then the board would take that into consideration, the aide said. politicsNews
puerto rico draft rescue bill guided bankruptcy juan reuters a congressional draft bill steer puerto rico economic crisis released tuesday elements bankruptcy law opposed creditors want keep island debt talks court the draft circulated house representatives committee natural resources includes sections bankruptcy code allow bankrupt entities certain circumstances force creditors take reduced layouts an official draft bill expected released april public comment period puerto rico billion debt major bond payments due coming months it also unfounded state pension liability nearly billion the bill provides puerto rico tools impose discipline finances meet obligations restore confidence institutions utah republican rob bishop committee chairman said statement we appreciate constructive efforts chairman bishop house natural resources committee begin drafting legislation address puerto rico fiscal economic crisis but current draft needs improvements said statement treasury spokesperson final legislation must provide puerto rico tools achieve lasting workable solution crisis create path recovery people puerto the panel bill would create federal board oversee island finances monitor accounting help curb spending it would also require puerto rico make efforts restructure debt consensual creditors if talks failed island public entities could file debt restructuring process based key statutes within bankruptcy law that would allow puerto rico force deals handout creditors the bill elements unexpected creditors house republicans largely opposed bankruptcy puerto rico the natural resources committee said retroactively adding territories like puerto rico federal bankruptcy code would undermine rule a congressional aide stressed draft legislation bankruptcy law directly add puerto rico bankruptcy code though follows similar language the obama administration advocated allow puerto rico restructure debt process house minority leader nancy pesos criticized sweeping powers oversight board proposed bill the bill final form may include language protects existing consensual restructuring deal creditors power utility prep congressional aide said prep earlier year reached deal creditors holding roughly percent billion debt the bill current form finally irresponsible financial adviser stephen spencer houlihan like said emailed statement the company clients include major puerto rico creditors oppenheimerfunds franklin advisers as showed prep deal fair solutions reached puerto rico creditors benefit stakeholders however discussion draft bill worse creditors chapter spencer said how oversight board treats island general obligation bonds typically regarded senior debt versus pension payments also source concern creditors the oversight board look bond issued make determination relates creditors existing law congressional aide said if go bonds constitutionally protected within limits board would take consideration aide said politicsnews
Your task is to classify the provided input as real or fake news. Label 0 is meant for fake news, Label 1 is for real news. TEXT: Puerto Rico draft rescue bill guided by U.S. bankruptcy rulesWASHINGTON/SAN JUAN (Reuters) - A U.S. congressional draft bill to steer Puerto Rico through its economic crisis was released on Tuesday with elements of U.S. bankruptcy law opposed by creditors who want to keep the island’s debt talks out of court. The draft, circulated by the U.S. House of Representatives Committee on Natural Resources, includes sections of the U.S. Bankruptcy Code that allow bankrupt entities under certain circumstances to force creditors to take reduced payouts. An official draft of the bill is expected to be released on April 11 after a public comment period. Puerto Rico has $70 billion in debt, with major bond payments due in coming months. It also has an unfunded state pension liability of nearly $44 billion. The bill “provides Puerto Rico with tools to impose discipline over its finances, meet its obligations and restore confidence in its institutions,” Utah Republican Rob Bishop, the committee’s chairman, said in a statement. “We appreciate the constructive efforts by Chairman Bishop and the House Natural Resources Committee to begin drafting legislation to address Puerto Rico’s fiscal and economic crisis. But the current draft needs improvements,” said a statement from a Treasury spokesperson. “Final legislation must provide Puerto Rico with tools to achieve a lasting, workable solution to this crisis and create a path to recovery for the people of Puerto Rico.” The Republican-led panel’s bill would create a federal board to oversee the island’s finances, monitor its accounting and help curb spending. It would also require Puerto Rico to make efforts to restructure debt consensually with creditors.  If those talks failed, the island or its public entities could file for a court-supervised debt restructuring process based on key statutes within U.S. bankruptcy law. That would allow Puerto Rico to force such deals on holdout creditors. The bill’s elements were unexpected because creditors and House Republicans had largely opposed bankruptcy for Puerto Rico. The Natural Resources Committee had said that “retroactively adding territories” like Puerto Rico to the federal bankruptcy code “is ill-conceived and would undermine the rule of law.” A congressional aide stressed that the draft legislation was not a bankruptcy law, and does not directly add Puerto Rico to U.S. bankruptcy code, though it follows similar language. The Obama Administration has advocated to allow Puerto Rico to restructure its debt in a court-sanctioned process. House Minority Leader Nancy Pelosi criticized the “sweeping powers of the oversight board proposed” in the bill. The bill in its final form may include language that protects an existing consensual restructuring deal between creditors and the power utility, PREPA, the congressional aide said. PREPA earlier this year reached the deal with creditors holding roughly 70 percent of its $8.3 billion in debt. “The bill in its current form is fiscally irresponsible,” financial adviser Stephen Spencer of Houlihan Lokey said in an emailed statement. The company’s clients include major Puerto Rico creditors such as OppenheimerFunds and Franklin Advisers. “As we showed with the PREPA deal, fair solutions can be reached between Puerto Rico and its creditors that benefit all stakeholders. However, the Discussion Draft Bill is worse for creditors than Chapter 9,” Spencer said. How the oversight board treats the island’s General Obligation bonds, which is typically regarded as the most senior debt, versus pension payments is also a source of concern for creditors. The oversight board will look at each bond issued and make a determination on how it relates to other creditors under the existing law, the congressional aide said. If the GO bonds are constitutionally protected and within their limits then the board would take that into consideration, the aide said. politicsNews
Your task is to classify the provided input as real or fake news. Label 0 is meant for fake news, Label 1 is for real news. TEXT: puerto rico draft rescue bill guided bankruptcy juan reuters a congressional draft bill steer puerto rico economic crisis released tuesday elements bankruptcy law opposed creditors want keep island debt talks court the draft circulated house representatives committee natural resources includes sections bankruptcy code allow bankrupt entities certain circumstances force creditors take reduced layouts an official draft bill expected released april public comment period puerto rico billion debt major bond payments due coming months it also unfounded state pension liability nearly billion the bill provides puerto rico tools impose discipline finances meet obligations restore confidence institutions utah republican rob bishop committee chairman said statement we appreciate constructive efforts chairman bishop house natural resources committee begin drafting legislation address puerto rico fiscal economic crisis but current draft needs improvements said statement treasury spokesperson final legislation must provide puerto rico tools achieve lasting workable solution crisis create path recovery people puerto the panel bill would create federal board oversee island finances monitor accounting help curb spending it would also require puerto rico make efforts restructure debt consensual creditors if talks failed island public entities could file debt restructuring process based key statutes within bankruptcy law that would allow puerto rico force deals handout creditors the bill elements unexpected creditors house republicans largely opposed bankruptcy puerto rico the natural resources committee said retroactively adding territories like puerto rico federal bankruptcy code would undermine rule a congressional aide stressed draft legislation bankruptcy law directly add puerto rico bankruptcy code though follows similar language the obama administration advocated allow puerto rico restructure debt process house minority leader nancy pesos criticized sweeping powers oversight board proposed bill the bill final form may include language protects existing consensual restructuring deal creditors power utility prep congressional aide said prep earlier year reached deal creditors holding roughly percent billion debt the bill current form finally irresponsible financial adviser stephen spencer houlihan like said emailed statement the company clients include major puerto rico creditors oppenheimerfunds franklin advisers as showed prep deal fair solutions reached puerto rico creditors benefit stakeholders however discussion draft bill worse creditors chapter spencer said how oversight board treats island general obligation bonds typically regarded senior debt versus pension payments also source concern creditors the oversight board look bond issued make determination relates creditors existing law congressional aide said if go bonds constitutionally protected within limits board would take consideration aide said politicsnews