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  • Writer's pictureThe San Juan Daily Star

Fiscal board given until Friday to file 3rd PREPA debt plan

By The Star Staff

The Financial Oversight and Management Board has until Friday, Aug. 11 to file its third debt adjustment plan for the Puerto Rico Electric Power Authority (PREPA), according to a recent court order.

It is the third extension to file the amended adjustment plan since the oversight board said it planned to cut PREPA’s bankruptcy debt by more than half to comply with PREPA’s fiscal plan for the year ending June 30, 2024. Creditors have opposed the reduction, with bondholders indicating in June that they may seek to dismiss the case so they can appoint a receiver.

The oversight board was supposed to file its amended plan of adjustment, but it requested an extension arguing that “material progress” was made in negotiating with unnamed creditors. In addition to reaching an agreement with the Fuel Line Lenders recently to amend the terms of the Fuel Line Lender PSA to align it with the projections in the 2023 PREPA fiscal plan, the oversight board has primarily been engaged in negotiations with other parties in interest to try to reach agreements for further plan support.

“While the oversight board cannot guaranty further settlement will be attained, it continues to believe the prospects of at least one major settlement is high and possibly two major settlements are sufficient to avoid filing an amended plan this week that might have to be amended again shortly thereafter, especially because the filing will trigger other filings of positions and schedules that might also change if a new settlement is attained,” the oversight board said in its motion to extend the deadlines.

U.S. District Judge Laura Taylor Swain, who is overseeing Puerto Rico’s Title III bankruptcy processes, granted the extension late last week.

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