SAN JUAN, Puerto Rico – Legislators on Tuesday demanded quicker action to rescue Puerto Rico's public power company, expressing dissatisfaction over the pace of a multimillion-dollar plan to improve its finances.
Members of the island's Senate Commission of Energy Affairs expressed concern the Electric Energy Authority might fall into receivership if the bondholders' debt is not paid soon.
"It's very important that we solve an issue that is really hurting the economy of Puerto Rico," Sen. Eduardo Bhatia said.
The authority's chief restructuring officer, Lisa Donahue, told the commission she will present a first draft by June 1 on how she plans to save the company.
"We get one chance to do this right. I wish it could go faster. It can't go faster," she said. "When our report is final, there will be very tough decisions that will require bipartisan support."
The Electric Energy Authority holds nearly $9 billion in debt and owes investors some $400 million by July. A bondholder group announced Tuesday that it has offered to extend the forbearance agreement for 30 more days after the government obtained a two-week extension earlier this month. The power company's board president, Harry Rodriguez, said Tuesday that no deal has been reached and accused the group of publicly releasing an incomplete summary of the newest proposal.
Donahue said if the deadline is not eventually met, the U.S. territory's government could face a 30-day default notice and bondholders could then file for appointment of a receiver.
Sen. Ramon Luis Nieves, who oversees the energy affairs commission, noted the U.S. territory's government is paying a total of $17.4 million to various firms to help strengthen the power company's finances.
"People have been asking, 'Are these agreements justified?'" he said. "Up until now we have no business plan, no recovery plan."
The bondholder group recently offered to invest $2 billion in energy production and other measures to improve the power company's finances and infrastructure. Donahue said Tuesday that some elements of the plan were helpful but others would not work given technical, systematic, regulatory or environmental issues.
Donahue said one of the power company's main challenges is dealing with a turnover of more than 200 management positions whenever a new party takes over the territory's governorship.
"Operating a business where you can't plan for the long term is an impossible task," she said.