US House clears PROMESA Act with amendments
Following an all-day session, the U.S. House passed H.R. 5278, known as the Puerto Rico Oversight, Management, and Economic Stability Act (“PROMESA”) on Thursday, with a bipartisan vote of 297-127 and a number of amendments.
“Today the House acted to prevent Puerto Rico’s fiscal crisis from escalating to a humanitarian catastrophe. This legislation provides Puerto Rico with tools to impose discipline over its finances, meet is borrowing obligations and build a new economic foundation,” Rep. Rob Bishop, chairman of the House Committee on Natural Resources, which moved the bill to a vote last week.
“This bill fulfills Congress’ constitutional responsibility to uphold our obligations to the American citizens of the U.S. territories. It is my hope the Senate acts expeditiously to pass this legislation,” he said.
H.R. 5278 received mostly solid support from both sides of the political aisle, with the exception of Puerto Rico-born Congressman Luis Gutiérrez, who slammed the bill, saying it disrespected the island’s people.
“I cannot add my vote to this bill and go back to Puerto Rico or to the Puerto Rican people in my Congressional district in Illinois with my head held high. I cannot and will not,” said Gutiérrez in a brief, but fiery speech on the House floor, which he ended in Spanish.
During the debate, Puerto Rico’s Resident Commissioner Pedro Pierluisi defended several amendments, including one presented with Congressmen Sean Duffy (R – WI) and Don Young (R-AK), to promote economic development in Puerto Rico by eliminating a statutory cap through the federal HubZones program that does not allow the population of “qualified census areas” in a “Metropolitan Statistical Area” to exceed 20 percent of the total population of the MSA.
The amendment passed, lifting the cap to Puerto Rico for 10 years or until the Oversight Board established by PROMISE ends, whichever comes first. Based on the best available statistics, this amendment ensures that small businesses located in more than 80 percent of the “qualified census areas” in Puerto Rico to be eligible to compete.
Pierluisi also supported the amendment of representatives David Jolly (R-Florida) and Carlos Curbelo (R-FL) requiring the Congressional Working Group on Economic Growth in Puerto Rico, created by Section 409 of the Act, to report on the recommended federal public policy that would reduce child poverty in Puerto Rico changes.
“I’m relieved the PROMESA Act passed with bipartisan support, but I’ve been clear throughout this process that this is not the bill I or Democrats would have written,” said Congressman Raúl Grijalva, ranking Democrat in the House Committee on Natural Resources.
Grijalva said the bill fell short in providing “enough material assistance to the people of Puerto Rico, the Oversight Board is too powerful and the provisions undermining minimum wage and the overtime rules don’t belong in the bill. Like many of my colleagues, I had to accept that there was no other avenue available to address the debt crisis in Puerto Rico. Compromises had to be made to get the bill through a Congress we do not control.”
One important amendment that failed to pass sought to eliminate the minimum wage provision that calls for allowing Puerto Rico businesses to pay workers under 25 an hourly rate of $4.25.
Meanwhile, Duffy, who several times during the debate defended Puerto Rico’s need to regain its footing, said the bill “is going to actually get Puerto Rico on a path to prosperity, opportunity and economic growth. It’s going to help people in Puerto Rico who have a dream of living in Puerto Rico actually stay in Puerto Rico with their families.”
The bill will now move to the U.S. Senate for a review and vote.
“The Senate should act expeditiously to review and vote on this measure, so the President can sign the bill into law ahead of the critical July 1st debt payment deadline,” the White House Office of the Press Secretary said in a statement following the House vote.
“As we have said, Puerto Rico’s path forward to economic growth requires not just the financial tools in this bill to address the immediate debt crisis, but also additional economic tools to grow Puerto Rico’s economy in the long run,” according to the statement.
To that end, consistent with President Obama’s plan released last year, Congress will need to take additional steps to ensure that Puerto Rico can provide access to quality health care and job opportunities for all its citizens.
“We urge leaders in both parties to build on [Thursday’s] bipartisan momentum and help Puerto Rico move toward lasting economic prosperity,” the statement concluded.