Individual Puerto Rico bondholders announced the creation of Backyard Bondholders seeking to have a unified voice in the negotiations between the commonwealth’s government, the U.S. House of Representatives and other creditors on the restructuring of the public debt.
Backyard Bondholders aims to advocate for Puerto Rico individual creditors, who own approximately 20 percent of the total outstanding debt, estimated at $70 million.
The group is already engaged with key decision-makers to prevent misguided decisions from disparately penalizing the savings of thousands of Americans in Puerto Rico, Jorge Irizarry, executive director of Backyard Bondholders, said.
“Every one of us has worked hard, saved and invested our hard-earned savings in Puerto Rico. The future of Puerto Rico and the repayment of our savings that were invested in its bonds, is being negotiated in Puerto Rico and Washington D.C., without our input,” he said.
“The local bondholders have so far been absent throughout this discussion. Now we will be heard,” said Irizarry, who is a former president of the Government Development Bank under Gov. Aníbal Acevedo-Vilá.
Local bondholders, he said, “are people who have dedicated their lives to economic development, job creation and boosting Puerto Rico’s economy. The money that local bondholders lent to the government was made in Puerto Rico and was continually reinvested in Puerto Rico. Puerto Rico residents, as opposed to non-residents, will be taxed to repay all the debt, including ours, which until now, had no representation.”
“Our participation is key to insure justice in the decisions taken in relation to the fiscal crisis. To decapitalize the local bondholder would be a mortal blow to the local economy of Puerto Rico,” Irizarry added.
The organization has advisers in Puerto Rico and the U.S. mainland and continues to grow by recruiting local bondholders. The group hired Washington, D.C.-based law firm Williams & Jensen, which will work with a local firm to be announced.