Sponsors (2)
The bill shifts control of Puerto Rico’s fiscal oversight andPROMESA representation to local authorities—increasing local accountability and continuity—while risking higher borrowing costs, reduced federal fiscal discipline, and legal or procedural complications that could harm residents and creditors.
Puerto Rico residents and local officials regain earlier and greater local control over fiscal oversight and successor arrangements, allowing locally designed governance tailored to Puerto Rico’s needs.
Puerto Rico residents, creditors, and other parties get continuity and predictability in debt restructurings because existing certified fiscal plans/budgets, PROMESA confirmation standards, and U.S. District Court jurisdiction are preserved until formally changed.
PREPA, its successor, and related parties can maintain continuity of legal representation by retaining professionals previously engaged by the Oversight Board, reducing disruption in ongoing PROMESA bankruptcy cases.
Puerto Rico residents, taxpayers, and borrowers could face higher borrowing costs and reduced access to capital if markets view locally created successor arrangements as weaker than Board oversight.
Puerto Rico residents and taxpayers risk reduced fiscal discipline and greater budget instability if the federal Oversight Board’s enforcement role is removed prematurely, potentially resulting in cuts to public services.
Creditors, taxpayers, and other PROMESA stakeholders may face slower or more complicated bankruptcy negotiations and restructuring timelines due to shifts in representation from the federally appointed Board to locally designated representatives.
Based on analysis of 4 sections of legislative text.
Allows Puerto Rico to terminate the Oversight Board by enacting successor-entity law and lets the Commonwealth substitute its designee as debtor representative in PREPA bankruptcy cases while preserving confirmation rules.
Introduced March 5, 2026 by S. Raja Krishnamoorthi · Last progress March 5, 2026
Changes federal oversight and bankruptcy representation rules for Puerto Rico by creating a new, automatic path to end the federally appointed Oversight Board when the Commonwealth enacts legislation establishing a successor entity, and by allowing the Commonwealth’s chosen designee to serve as the debtor’s representative in PREPA restructuring cases filed after that Commonwealth legislation. The bill also preserves existing confirmation standards, prior certified fiscal plans/budgets, and the District of Puerto Rico’s jurisdiction despite these changes.