Puerto Rican Lawmakers Try to End Crisis

Puerto Rican lawmakers on Saturday approved the first key pieces of legislation aimed at resolving a budget crisis that has kept more than 100,000 public employees out of work since May 1.

In a session that stretched past midnight, the House of Representatives unanimously authorized an emergency loan of up to $741 million to pay government salaries until the end of the fiscal year on June 30.

The House also voted 48-1 to approve a special fund to help pay off the island's debt, using 1 percent of a new sales tax the size of which has yet to be determined.

A third measure, which passed with 48 votes in favor and one abstention, aims to achieve some $300 million in annual savings by eliminating and consolidating government agencies. Lawmakers said the budget reform would only cut the positions of contract employees from the public payroll, not civil servants.

The measures are contained in a deal Gov. Anibal Acevedo Vila reached with lawmakers on Wednesday to end the partial government shutdown. Acevedo had warned the deal could unravel if lawmakers didn't act this weekend.

Under the agreement, public employees would return to work on Monday and receive pay for work missed as a result of the shutdown.

The Senate was expected to consider the measures later Saturday.

The shutdown has crippled government services and hurt businesses in this U.S. Caribbean territory.

It also spurred New York-based Moody's Investors Service to cut the rating of the territory's general obligation bonds to one notch above junk status — affecting about $25 billion of government debt.