PRRADA

Madam Speaker, I move to suspend the rules and pass the bill (H.R. 1192) to impose requirements on the payment of compensation to professional persons employed in voluntary cases commenced under title III of the Puerto Rico Oversight Management and Economic Stability Act (commonly known as ``PROMESA'').

Madam Speaker, I ask unanimous consent that all Members have 5 legislative days to revise and extend their remarks and include extraneous material on the bill under consideration.

Madam Speaker, I yield myself such time as I may consume.

Madam Speaker, as I always do, let me thank the sponsor of this legislation for her leadership, the gentlewoman from New York (Ms. Velazquez), and all of those who have supported this important leadership bill.

H.R. 1192, the Puerto Rico Recovery Accuracy In Disclosures Act, or PRRADA, is commonsense legislation that would promote greater transparency and integrity with respect to the ongoing financial reorganization of Puerto Rico.

In response to dire fiscal issues facing Puerto Rico at the time, Congress passed the Puerto Rico Oversight, Management, and Economic Stability Act, or PROMESA, in 2016. That legislation established a financial oversight and management board with control over Puerto Rico's budget, laws, financial plans, and regulations and the authority to retain professionals to assist the board in executing its responsibilities.

Though largely patterned on Chapter 11 of the Bankruptcy Code, PROMESA did not incorporate all facets of Chapter 11 and other relevant provisions of the code. Importantly, this includes the code's mandatory disclosure requirements regarding actual or potential conflicts of interest that professional persons seeking to be retained in a bankruptcy case must make to the court prior to their retention.

This bill would close that loophole by conditioning the compensation of professional persons retained under PROMESA upon certain disclosures similar to those required under the Bankruptcy Code.

Additionally, the bill would require the United States Trustee to review these disclosures and submit comments in response to the court and also authorize the United States Trustee to object to compensation requested by the professionals.

Finally, H.R. 1192 would allow courts to deny compensation for services and reimbursement of expenses if the professional person did not comply with the disclosure requirement, was not a disinterested person, or represented or held an interest adverse to the bankruptcy estate.

I thank Ms. Velazquez for her leadership in championing this bill and for her relentless dedication, which we all have witnessed, to ensuring that the people of Puerto Rico receive the fair, efficient, and transparent restructuring process they deserve.

I urge my colleagues to support this bill, which was passed out of the House last Congress by a unanimous vote.

Madam Speaker, as a senior member of the Judiciary, Committee, I rise in strong support of H.R. 1192, the ``Puerto Rico Recovery Accuracy in Disclosures Act of 2021'' or ``PRRADA Act,'' which conditions compensation of professional persons retained under the congressionally passed ``Puerto Rico Oversight, Management, and Economic Stability Act'' (``PROMESA'') upon the applicant providing certain disclosures similar to those required under Bankruptcy Code section 327.

In response to dire fiscal issues facing Puerto Rico at the time, Congress passed Pub. L. 114-187, the ``Puerto Rico Oversight, Management, and Economic Stability Act'' or ``PROMESA'' in 2016, legislation I strongly supported and cosponsored.

The Act established the Financial Oversight and Management Board (Board), a fiscal control board comprised of seven members that would have control over Puerto Rico's budget, laws, financial plans, and regulations.

It empowered the board to propose a budget for Puerto Rico and restructure its obligations owed to bondholders, estimated to be $6.5 billion, and other creditors.

Although largely patterned on chapter 11 of the Bankruptcy Code, PROMESA did not incorporate all facets of chapter 11 and other relevant provisions of the Code.

For example, although the Board is authorized to retain and compensate professional persons in connection with its efforts to reorganize Puerto Rico, PROMESA does not include certain restrictions that the Bankruptcy Code requires for such purposes.

For example, Section 327 of the Bankruptcy Code, unlike PROMESA, authorizes professional persons, such as attorneys, financial advisors, appraisers, and others, to be retained in connection with the administration of a bankruptcy case provided they meet the following conditions: first, such a person must not hold or represent an interest adverse to the bankruptcy estate; and second, the professional must be a ``disinterested person.''

As I indicated at the outset, H.R. 1192, the ``Puerto Rico Recovery Accuracy in Disclosures Act of 2021'' or ``PRRADA,'' conditions compensation of professional persons retained under PROMESA upon the applicant providing certain disclosures similar to those required under Bankruptcy Code section 327.

In addition, it would require the United States Trustee to review such disclosures and submit comments in response to the court as well as authorize the United States trustee to object to compensation requested by professionals. Further, the measure would apply retroactively to professionals who have previously been awarded compensation.

Finally, H.R. 1192 would authorize the court to deny allowance of compensation for services and reimbursement of expenses accruing after the bill's enactment date if the professional person did not comply with the disclosure requirement, was not a disinterested person, or represented or held an interest adverse to the bankruptcy estate.

I urge all Members to join me in voting for H.R. 1192, the ``Puerto Rico Recovery Accuracy in Disclosures Act of 2021.''

Madam Speaker, I reserve the balance of my time.

Madam Speaker, I yield 4 minutes to the gentlewoman from New York (Ms. Velazquez), the author of this legislation and also a champion, as all Members of the United States Congress know, during the very trying and difficult times of our friends in Puerto Rico. It is her voice that has been the most singularly powerful in their advocacy, along with her wonderful colleague, the distinguished representative, the Resident Commissioner from Puerto Rico.

Madam Speaker, I yield myself such time as I may consume.

Madam Speaker, let me indicate again, this is a very vital initiative to continue to help in Puerto Rico's recovery. Let me thank the gentlewoman from New York for her leadership and, of course, the gentlewoman from Puerto Rico. This partnership and bipartisan collaboration with the other cosponsors is very crucial as we continue to work as a Congress to do our job for the people of Puerto Rico.

H.R. 1192 closes a loophole under current law by establishing disclosure requirements regarding actual or potential conflicts of interest in the bankruptcy process under PROMESA. In doing so, this legislation promotes transparency and accountability in the Puerto Rico restructuring process.

Again, I thank my colleague, Ms. Velazquez from New York, the author of the bill, for her leadership on this issue, and Mr. Nadler and his work.

I strongly urge my colleagues to support this commonsense measure. This, of course, along with the gentlewoman from Puerto Rico, is helping the people of Puerto Rico, our neighbors and our fellow Americans.

Madam Speaker, I yield back the balance of my time.

Mr. Speaker, I move to suspend the rules and concur in the Senate amendment to the bill (H.R. 1192) to impose requirements on the payment of compensation to professional persons employed in voluntary cases commenced under title III of the Puerto Rico Oversight Management and Economic Stability Act (commonly known as ``PROMESA'').

Mr. Speaker, I ask unanimous consent that all Members have 5 legislative days to revise and extend their remarks and to include extraneous material on the bill under consideration.

Mr. Speaker, I yield myself such time as I may consume.

H.R. 1192, the Puerto Rico Recovery Accuracy in Disclosures Act of 2021, or PRRADA, is commonsense legislation that would promote greater transparency and integrity with respect to the ongoing financial reorganization of Puerto Rico. This will be the third time in just over 2 years that the House will vote on this legislation, but, Mr. Speaker, I think the third time will be the charm.

In response to dire fiscal issues facing Puerto Rico at the time, Congress passed the Puerto Rico Oversight, Management, and Economic Stability Act, or PROMESA, in 2016.

That legislation established the Financial Oversight and Management Board with control over Puerto Rico's budget, laws, financial plans, and regulations, and the authority to retain professionals to assist the Board in executing its responsibilities.

Although largely patterned on Chapter 11 of the Bankruptcy Code, PROMESA did not incorporate all facets of Chapter 11 and other relevant provisions of the code.

Importantly, this includes the code's mandatory disclosure requirements regarding actual or potential conflicts of interest that professional persons seeking to be retained in a bankruptcy case must make to the court prior to their retention.

This bill would close that loophole by conditioning the compensation of professional persons retained under PROMESA under certain disclosures similar to those required under the Bankruptcy Code.

Additionally, the bill would require the United States Trustee to review these disclosures and to submit comments in response to the court, and it also authorizes the United States Trustee to object to compensation requested by professionals.

And finally, H.R. 1192 would allow courts to deny compensation for services and reimbursement of expenses if the professional person did not comply with the disclosure requirement, was not a disinterested person, or represented or held an interest adverse to the bankruptcy estate. Common sense.

The House passed H.R. 1192 last February, and the Senate passed an amended version of the Act last December. The Senate amendments streamlined PRRADA's reporting requirements, strengthened the incentives for good faith compliance, and clarify other provisions of the Act.

Now, Puerto Rico's restructuring is drawing to a close, which makes passage of this legislation especially urgent.

I thank Representative Velazquez for her leadership in championing this bill and for her relentless dedication to ensuring that the people of Puerto Rico receive the fair, efficient, and transparent restructuring process they deserve.

I urge my colleagues to support this bill, which was passed out of the House last year and the year before by unanimous votes, and I reserve the balance of my time.

Mr. Speaker, I reserve the balance of my time.

Mr. Speaker, I am prepared to close, and I reserve the balance of my time.

Mr. Speaker, in closing, H.R. 1192 closes a loophole under current law by establishing disclosure requirements regarding actual or potential conflicts of interest in the bankruptcy process under PROMESA. In doing so, this legislation promotes transparency and accountability in the Puerto Rico restructuring process.

I thank my colleague, Representative Velazquez from New York, the author of the bill, for her leadership on this issue, and I strongly urge my colleagues to support this commonsense measure.

Mr. Speaker, I yield back the balance of my time.

Madam Speaker, I rise in support of the Puerto Rico Recovery Accuracy in Disclosures Act, H.R. 1192.

Representative Velazquez and myself have proposed this bipartisan initiative in the last two Congresses, having achieved passage in the House during the last session. I think Congresswoman Velazquez is very thoughtful in terms of how important this is and the effects on PROMESA regarding this bill.

We support this bill as an important component in ensuring the restructuring process under PROMESA, and it looks out for Puerto Rico's interests.

This legislation requires any counsel and professional personnel that the financial oversight board may hire to work on a title III case for the restructuring of Puerto Rico's debt to submit verified disclosures of their connections with the debtor, creditors, or persons employed by the oversight board prior to being compensated.

These provisions extend the same requirements to decisions about the hiring of personnel for the restructuring as are imposed on such personnel under existing bankruptcy rules. I think it is important to have the same kind of rules for those people who are going to be managing, as we speak, those kinds of negotiations.

Our intention is not to exclude any people with expertise and knowledge about Puerto Rico's fiscal transactions from being resources in the restructuring process, but I think it is essential that any such connection be clear and known so that such persons' qualifications and the role they are going to be playing can be better evaluated.

Conflict of interest, or the appearance of a conflict of interest, can be best avoided if there are accountability and transparency during the process. This bill would allow that to happen.

This bill would require that such personnel must disclose in detail their participation and involvement with any entity involved in the issuance of Puerto Rico's debt and in any claims involving Puerto Rico's debt, informing the identity of each one.

Anyone who is serving in the board--and I repeat, anyone who is serving in the board--working to inform its decisions, or representing it before the title III court, must have the trust of all parties that they are committed to defending the interests of Puerto Rico to the best of their ability in accordance to the law and justice.

A lack of transparency in personnel decisions creates a lack of confidence and distrust. Learning that someone was involved in the business of one of the parties in the case, only after they are named and working on the case, does not create assurance of their commitment to the best interests of Puerto Rico or even managing the debt.

Our goal must be to reach the day that we will no longer need the provisions of PROMESA or the fiscal oversight board, and we can dedicate ourselves to rebuild our economy and provide for growth. But until that happens, we must demand that those instruments created by PROMESA be accountable and transparent in their processes. Anything else should be unacceptable.

That is the reason this bill, H.R. 1192, is important, and I ask my colleagues to support and pass this bill.

Madam Speaker, I say thank you to the Congresswoman from New York (Ms. Velazquez) for this bill and for allowing this initiative to be a bipartisan one.

Mr. Speaker, I rise in strong support of the Senate Amendment to H.R. 1192, the Puerto Rico Recovery Accuracy in Disclosures Act of 2021. I was proud to introduce this bill with bipartisan support in the House. I would like to thank House Speaker Nancy Pelosi and Chairman Jerry Nadler for bringing this legislation to the floor and to Senator Bob Menendez for introducing a companion bill in the Senate and for his tireless efforts to make sure this Bill would get approved in the Senate.

H.R. 1192 already unanimously passed this House back on February 24, 2021 and I expect to do so the same today.

The Puerto Rico Recovery Accuracy in Disclosures Act of 2021 or ``PRRADA'' eliminates a double standard currently facing Puerto Rico. Under U.S. Code and Federal Bankruptcy procedure, any conflicts of interest--or even the perception of such conflict--between those working on the bankruptcy and the debtor are required to be disclosed.

However, a loophole in the current law prevents this requirement from being extended to the people of Puerto Rico.

In 2016, Congress passed the Puerto Rico Oversight, Management, and Economic Stability Act, otherwise known as PROMESA. When PROMESA was originally passed, it incorporated Chapter 11's bankruptcy requirement that professionals file fee applications with the court. But PROMESA did not include Chapter 11's disclosure requirements that go hand-in- hand with those fee applications. PRRADA remedies this and makes sure that professionals paid by the taxpayers of Puerto Rico are fully transparent about what interests they are serving.

Puerto Ricans should be confident that the Board's bankruptcy advisors do not have their ``thumb on the scale'' to favor certain debts where they have a self-interest. This bipartisan bill ensures integrity and transparency of the PROMESA process.

While we can have differing opinions on how effectively the Oversight Board is carrying out its mission, one thing should be clear--the island's residents should be entitled to the same rights and protections as any debtor on the mainland.

Once more, I would like to thank Chairman Nadler, the Committee Staff and the bipartisan cosponsors of this bill. I strongly encourage all members to vote ``Yes'' on this critical piece of legislation.

Mr. Speaker, I rise in support of the approval in the House of the Senate amendment to H.R. 1192, the Puerto Rico Recovery Accuracy in Disclosures Act of 2021.

I joined Representative Velazquez to promote this bipartisan and commonsense bill to help ensure the restructuring process under PROMESA serves Puerto Rico's interests. Actually, just

this week, the plan was approved by the Federal Court, so this is perfect timing to approve this bill today.

Though it required some technical corrections, it is satisfying to see this bill has already achieved passage in both Chambers. I wish for my colleague, Congresswoman Velazquez, to be fully recovered in time to see it become law.

The intent of this legislation remains the same, and this bill will require any person or firm hired as legal, financial or technical staff or consultants for the Financial Oversight Board in the court cases for the restructuring of Puerto Rico's debt, to submit verified disclosures of all connections with debtors, creditors, or other interested parties in the process, before being compensated.

Our intention is not to exclude people with experience in Puerto Rico's financial transactions from being resources in the restructuring process, but it is essential that their connection to any parties interested in those transactions be known. Conflict of interest, or the appearance of conflict of interest, can be best avoided if there is accountability and transparency.

Anyone working to inform the Board's decisions, or representing it before the court, needs to be committed to defending the interests of the people of Puerto Rico first, in accordance with the law and justice.

Lack of transparency creates a lack of trust, and this bill will work toward avoiding that by making these disclosures a legal mandate rather than the Board's own discretion.

Our goal is to reach the day we no longer need the provisions of PROMESA and the Oversight Board, but until that happens, these instruments must be accountable and transparent.

I ask my colleagues to support the passage of the Senate amendment to H.R. 1192, the Puerto Rico Recovery Accuracy in Disclosures Act of 2021.