SAN JUAN, Puerto Rico (AP) — Efforts to restructure some $9 billion in debt held by Puerto Rico’s power company hit a new snag Thursday following multiple failed attempts to end its bankruptcy.
Officials had until Thursday to submit a new proposal on how to cut the Electric Power Authority’s debt — the largest held by any government agency — but a mediation team overseeing negotiations between bondholders and Puerto Rico’s government requested a one-week extension.
Federal Judge Laura Taylor-Swain, who is overseeing the case, approved the extension request, saying it was reasonable and necessary.
Solving the power company’s debt is considered key for Puerto Rico’s economic development as the U.S. territory remains mired in a deep economic slump and investors continue to be spooked by the financial uncertainty and chronic power outages blamed in part on aging infrastructure stemming from decades of neglect and mismanagement.
Puerto Rico emerged earlier this year from the largest U.S. municipal bankruptcy in history after announcing in 2015 that it was unable to pay its more than $70 billion public debt following decades of corruption, mismanagement and heavy borrowing. The island's power company is now the only government agency left that has yet to restructure its debt. Many on the island fear that ongoing prickly negotiations might lead to yet another increase in already costly electric bills to finance payments to creditors.
In a court filing Thursday, the mediation team noted that a federal control board overseeing Puerto Rico’s finances and representing the island’s government in the bankruptcy case has failed to submit basic data and analyses relevant to ongoing negotiations over the power company’s debt.
The team said that without the information, there could...