• The San Juan Daily Star

Bar Assn. defends retirement law in friend of the court filing


By The Star Staff


In enacting Puerto Rico’s Dignified Retirement Act, Act No. 7 of 2021, the island government is trying to provide a reasonable alternative to the Financial Oversight and Management Board’s (FOMB) plan of adjustment and exercising its policymaking power to pass laws to protect people’s life, health and welfare, a Puerto Rico Bar Association (PRBA) friend of the court brief reads.


The document was filed last week in the case FOMB vs Pierluisi, an adversary proceeding in the U.S. commonwealth’s Title III bankruptcy case, in which the oversight board seeks to repeal Act 7 because it interferes with the debt deal. The government has said the controversy is not ripe for adjudication and is seeking a stay, arguing the law has not been implemented yet.


The Bar Association says Act 7 is an attempt by the government to protect public pensions, prevent cost-of-living increases and achieve debt sustainability by choosing to pursue the cancellation of illegal debt in court and by announcing the future creation of a Trust Fund for the Joint Administration of the Retirement Systems (FACSiR by its Spanish acronym).


“It is a policy choice born out of the collective work of public unions, trade, civil society, environmental, and feminist organizations in Puerto Rico and the Puerto Rican diaspora. And it was unanimously approved by elected representatives of all five political parties in Puerto Rico, as well as its lone independent Senator,” the brief reads. “Few Puerto Rican laws dealing with crucial policy issues can claim to be the result of such a broad political consensus. To challenge it, as the Board here attempts, is not only to confront the policy choices of the Government of Puerto Rico, but to seek to enjoin the will of its people.”


The Bar Association said the Puerto Rico Oversight, Management and Economic Stability Act (PROMESA) gives the oversight board a very specific role with regard to the enactment of legislation in Puerto Rico. Congress did not grant the oversight board “power to affirmatively legislate, thus leaving the exercise of the commonwealth’s legislative powers in the hands of the Legislature.”


While PROMESA provides that the commonwealth government may not “enact, implement, or enforce any statute, resolution, policy, or rule that would impair or defeat the purposes, of PROMESA as determined by the Board” or pass laws inconsistent with the fiscal plan, the Association said it believes those provisions are illegal.


“The Puerto Rico Bar Association is on record arguing that these, as well as other, provisions of PROMESA, constitute an impermissible exercise of Congress’ powers under the Territorial Clause, and violate Puerto Rico’s right to self-determination under international law,” the Bar Association said.


The case is of particular importance because, yet again, it directly implicates the political and legal relationship between Puerto Rico and the federal government, the association said.


“Specifically, the case deals with the imposition by Congress of the Board on the People of Puerto Rico that today, invoking several provisions in PROMESA, seeks to intrude upon and usurp the powers of majority rejection of the territorial status expressed at the polls by the People of Puerto Rico at the plebiscite held on November 6, 2012, and the violation of the right of Puerto Rico to its self-determination, as guaranteed by International Law,” the association said.


“Today, the controversy revolves around Act No. 7-2021, a law endorsed by dozens of civil society organizations in Puerto Rico, including the PRBA, and approved by the unanimous vote of representatives from all political parties in the Archipelago,” the association said. “However, the decision over this issue will have broader implications for Puerto Rico, particularly, if the Board is allowed to sidestep the powers of the Puerto Rico Legislative Assembly and force it to enact legislation responding to its policy views, irrespective of the wellbeing of the People of Puerto Rico, considering that our constitutional framework rests on the People to elect public officials to enact laws at the Puerto Rico Legislative Assembly.”