Today, the Subcommittee on Indian and Insular Affairs held an oversight hearing on the status of Puerto Rico's fiscal recovery under the Puerto Rico Oversight, Management, and Economic Stability Act (PROMESA). Subcommittee Chairman Jeff Hurd (R-Colo.) issued the following statement in response:

"Nearly a decade after PROMESA’s enactment, Puerto Rico has made real progress toward financial stability, thanks to meaningful reforms and difficult but necessary restructuring. Today’s hearing is about ensuring that this progress continues—through transparency, accountability, and a clear path to long-term fiscal independence."

Background

Puerto Rico’s debt crisis emerged in 2015 from a confluence of factors, including prolonged economic stagnation, structural imbalances, and unstable borrowing practices. Ultimately, fiscal collapse and governmental emergency led Congress to pass PROMESA in 2016.

PROMESA created a seven-member Financial Oversight and Management Board (FOMB) with broad authority over Puerto Rico’s finances. The FOMB reviews and certifies fiscal plans and budgets for the Commonwealth of Puerto Rico. Its authority also includes contract review and making policy recommendations to the Puerto Rican government.

PROMESA established a comprehensive fiscal oversight and restructuring framework with the intention to enable long-term, pro-growth fiscal reforms and structural transformation to restore Puerto Rico’s economic health.

Although PROMESA is succeeding in reducing the Commonwealth of Puerto Rico’s debt and Puerto Rico’s government has made some recent progress in balancing its budget, the U.S. Government Accountability Office has identified persistent transparency and capacity shortfalls. Today's hearing focused on the challenges that lie ahead for continued fiscal reform and stressed the need for continued oversight to continue economic recovery.