Special Revenue Bonds Puerto Rico

M unicipalities have long issued special revenue bonds as defined by the federal bankruptcy code to finance essential service infrastructure projects including water waste and electric utilities.

Special revenue bonds puerto rico. By statute the bonds were secured by a gross lien on revenues derived from certain highway tolls and excise taxes collectively the pledged special revenues. Chicago reuters a decision this week by a u s. Ruling against a group of bond insurers a u s. The case involved several series of bonds the bonds issued by the puerto rico highway and transportation authority prhta a public corporation of the commonwealth of puerto rico.

Appeals court in a lawsuit related to puerto rico s bankruptcy raises concerns over the payment of municipal bonds backed by specific revenues. The bankruptcy code provides special revenue bonds with unique features that benefit creditors during an issuer s bankruptcy. One key provision section 922 addresses the timely payment of. Circuit court of appeal s affirmation of a lower court s decision regarding the puerto rico highway transportation authority should rest a bit easier.

Circuit court of appeals which determined that payments on certain puerto rico bonds secured by special revenues are not. Law360 july 10 2018 10 08 pm edt puerto rico and its federally appointed financial restructuring advisers urged the first circuit on monday to affirm a decision that has freed the. Municipal special revenue bond ratings are being reviewed for a potential downgrade after a recent appellate court decision raised questions about their status. Municipal bond investors worried by the 1st u s.