,i  #aadth ,,congress  #ast ,session    
,h4 ,r4 #daii  ,,in ,,the ,,house ,,of  
,,representatives  ,december #i1 #bjae  
,mr4 ,duffy introduced the following    
bill2 which was referred to the         
,committee on ,natural ,resources1 and  
in addition to the ,committee on the    
,judiciary1 for a period to be          
subsequently determined by the ,speaker1
 in each case for consideration of such 
provisions as fall within the           
jurisdiction of the committee concerned 
,a ,,bill  ,to provide the ,government  
of ,puerto ,rico the choice to          
restructure its municipal debt in       
conjunction with enhanced financial     
oversight1 and for other purposes4  #a4 
,short title2 table of contents  7a7    
,short title ,this ,act may be cited as 
the ,puerto ,rico ,financial ,stability 
and ,debt ,restructuring ,choice ,act4  
7b7 ,table of contents ,the table of    
contents for this ,act is as follows3   
,sec4 #a4 ,short title2 table of        
contents4 ,sec4 #b4 ,findings4 ,title   

,i--,establishment and ,organization of 
,financial ,stability ,council ,sec4    
#aja4 ,puerto ,rico ,financial          
,stability ,council4 ,sec4 #ajb4        
,executive director and staff of        
,council4 ,sec4 #ajc4 ,powers of        
,council4 ,sec4 #ajd4 ,exemption from   
liability for claims4 ,sec4 #aje4       
,treatment of actions arising from ,act4
 ,sec4 #ajf4 ,funding for operation of  
,council4 ,sec4 #ajg4 ,termination of   
activities4 ,sec4 #ajh4 ,application of 
laws of ,puerto ,rico to ,council4 ,sec4
 #aji4 ,rules of construction4 ,title   
,,ii--,responsibilities of ,financial   
,stability ,council ,sec4 #bja4         
,development of financial plan and      
budget for ,puerto ,rico4 ,sec4 #bjb4   
,process for submission and approval of 
financial plan and annual ,puerto ,rico 
budget4 ,sec4 #bjc4 ,restrictions on    
borrowing by ,puerto ,rico4 ,sec4 #bjd4 
,effect of finding of noncompliance with
 financial plan and budget4 ,sec4 #bje4 
,recommendations on financial stability 

and management responsibility4 ,title   
,,iii--,debt ,restructuring ,sec4 #cja4 
,amendment4 ,sec4 #cjb4 ,effective date2
 application of amendment4 ,sec4 #cjc4  
,severability4  #b4 ,findings ,congress 
finds the following3 7#a7 ,a combination
 of structural problems1 mounting debt1 
and weak public finances has left       
,puerto ,rico in a financial debt crisis
 and resulted in continued outmigration 
of residents and business from ,puerto  
,rico further stifling growth4  7#b7 ,a 
comprehensive1 long-term approach must  
be established to initiate significant  
reforms to restore to ,puerto ,rico     
access to short-term and long-term      
lending1 eliminate annual deficits1 and 
reduce its debt4  7#c7 ,the current     
crisis requires congressional action    
that supports ,puerto ,rico by providing
 the appropriate tools needed to restore
 financial stability while respecting   
and strengthening its authority to      
operate and grow independently4  ,i     
,establishment and ,organization of     

,financial ,stability ,council  #aja4   
,puerto ,rico ,financial ,stability     
,council  7a7 ,establishment ,upon the  
enactment of a law or resolution adopted
 by the ,legislative ,assembly of       
,puerto ,rico and signed by the         
,governor of ,puerto ,rico1 and pursuant
 to article ,,iv1 section #c1 clause #b 
of the ,constitution of the ,united     
,states1 there shall be established the 
,puerto ,rico ,financial ,stability     
,council 7here and after referred to in 
this ,act as the ,council71 consisting  
of members appointed in accordance with 
subsection 7b74  7b7 ,membership  7#a7  
,in general ,the ,council shall consist 
of #e members appointed by the          
,president who meet the qualifications  
described in subsection 7c74  7#b7      
,consultation with congress ,the        
,president shall consult with the       
,speaker of the ,house of               
,representatives1 the ,minority ,leader 
of the ,house of ,representatives1 the  
,majority ,leader of the ,senate1 the   

,minority ,leader of the ,senate1 and   
the ,resident ,commissioner from ,puerto
 ,rico with respect to who should be    
appointed to the ,council4  7#c7 ,chair 
,the ,president shall designate one of  
the members of the ,council as the chair
 of the ,council4  7#d7 ,sense of       
congress regarding deadline for         
appointment ,it is the sense of         
,congress that the ,president should    
appoint the members of the ,council as  
soon as practicable after the           
establishment of the ,council1 but in no
 event later than #be days after the    
date of the establishment of the        
,council4  7#e7 ,term of service  7,a7  
,in general ,except as provided in      
subparagraph 7,b71 each member of the   
,council shall be appointed for a term  
of #c years4  7,b7 ,appointment for term
 following initial term ,for the term   
immediately following the initial term1 
members shall be appointed by the       
,president as follows3  7i7 #a member   
for a term of #a year4  7ii7 #b members 

each for a term of #b years4  7iii7 #b  
members each for a term of #c years4    
7,c7 ,removal ,the ,president may remove
 any member of the ,council only for    
cause4  7c7 ,qualifications for         
membership ,an individual meets the     
qualifications for membership on the    
,council if the individual-- 7#a7 has   
knowledge and expertise in finance1     
management1 and the organization or     
operation of business or government2    
7#b7 does not provide goods or services 
to the ,government of ,puerto ,rico 7and
 is not the spouse1 parent1 child1 or   
sibling of an individual who provides   
goods and services to the ,government of
 ,puerto ,rico72  7#c7 is not an officer
 or employee of the ,government of      
,puerto ,rico2  7#d7 maintains a primary
 residence in ,puerto ,rico or has a    
primary place of business in ,puerto    
,rico2 and  7#e7 complies with ,federal 
conflict of interest requirements as    
mandated by section #bjh of title #ah1  
,united ,states ,code4  7d7 ,no         

compensation for service ,members of the
 ,council shall serve without pay1 but  
may receive reimbursement for any       
reasonable and necessary expenses       
incurred by reason of service on the    
,council4  7e7 ,adoption of by-,laws for
 conducting business of authority  7#a7 
,in general ,as soon as practicable     
after the appointment of its members1   
but not later than #cj days1 the        
,council shall adopt by-laws1 rules1 and
 procedures governing its activities    
under this ,act1 including procedures   
for hiring experts and consultants4     
,such by-laws1 rules1 and procedures    
shall be public documents1 and shall be 
submitted by the ,council upon adoption 
to the ,governor1 the ,legislative      
,assembly1 the ,president1 and          
,congress4  7#b7 ,certain activities    
requiring approval of majority of       
members ,under the by-laws adopted      
pursuant to paragraph 7#a71 the ,council
 may conduct its operations under such  
procedures as it considers appropriate1 

except that an affirmative vote of a    
majority of the members of the ,council 
shall be required in order for the      
,council to--  7,a7 approve or          
disapprove a financial plan and budget  
under title ,,ii2 and  7,b7 implement   
recommendations on financial stability  
and management responsibility under     
section #ajg4  7#c7 ,adoption of rules  
and regulations of ,puerto ,rico ,the   
,council may incorporate in its by-laws1
 rules1 and procedures under this       
subsection such rules and regulations of
 the ,government of ,puerto ,rico as it 
considers appropriate to enable it to   
carry out its activities under this ,act
 with the greatest degree of            
independence practicable4  #ajb4        
,executive director and staff of        
,council  7a7 ,executive director ,the  
,council shall have an executive        
director who shall be appointed by the  
chair with the consent of the ,council4 
,the executive director shall be paid at
 a rate determined by the ,council1     

except that such rate may not exceed the
 rate of basic pay payable for level    
,,iv of the ,executive ,schedule4  7b7  
,staff ,with the approval of the chair1 
the executive director may appoint and  
fix the pay of additional personnel as  
the executive director considers        
appropriate1 except that no individual  
appointed by the executive director may 
be paid at a rate greater than the rate 
of pay for the executive director4  7c7 
,inapplicability of certain employment  
and procurement laws  7#a7 ,civil       
service laws ,the executive director and
 staff of the ,council may be appointed 
without regard to the provisions of     
title #e1 ,united ,states ,code1        
governing appointments in the           
competitive service1 and paid without   
regard to the provisions of chapter #ea 
and subchapter ,,iii of chapter #ec of  
that title relating to classification   
and ,general ,schedule pay rates4  7#b7 
,puerto ,rico employment and procurement
 laws ,the executive director and staff 

of the ,council may be appointed and    
paid without regard to the provisions of
 the laws of ,puerto ,rico governing    
appointments and salaries4 ,the         
provisions of the laws of ,puerto ,rico 
governing procurement shall not apply to
 the ,council4  7d7 ,staff of ,federal  
agencies ,upon request of the chair1 the
 head of any ,federal department or     
agency may detail1 on a reimbursable or 
nonreimbursable basis1 any of the       
personnel of that department or agency  
to the ,council to assist it in carrying
 out its duties under this ,act4  7e7   
,preservation of retirement and certain 
other rights of ,federal employees who  
become employed by the ,council  7#a7   
,in general ,a ,federal employee who1   
within #b months after separating from  
the ,federal ,government1 becomes       
employed by the ,council--  7,a7 may    
elect1 for purposes of the retirement   
system in which that individual last    
participated before so separating1 to   
have such individual's period of service

 with the ,council treated in the same  
way as if performed in the position     
within the ,federal ,government from    
which separated1 subject to the         
requisite employee deductions and agency
 contributions being currently deposited
 in the appropriate fund2 and  7,b7 if1 
after serving with the ,council1 such   
employee becomes reemployed by the      
,federal ,government1 shall be entitled 
to credit for the full period of such   
individual's service with the ,council  
for purposes of determining the         
applicable leave accrual rate4  7#b7    
,retirement  7,a7 ,contributions ,for   
purposes of subparagraph 7,a7 of        
paragraph 7#a7-- 7i7 the employee       
deductions referred to in such paragraph
 shall be made from basic pay for       
service with the ,council1 and shall be 
computed using the same percentage as   
would then apply if the individual were 
instead serving in the position within  
the ,federal ,government from which     
separated2 and  7ii7 the agency         

contributions referred to in such       
paragraph shall be made by the ,council4
  7,b7 ,double coverage not permitted   
,an individual who makes an election    
under paragraph 7#a77;,a7 shall be      
ineligible1 while such election remains 
in effect1 to participate in any        
retirement system for employees of the  
,government of ,puerto ,rico4  7#c7     
,regulations ,the ,office of ,personnel 
,management shall prescribe such        
regulations as may be necessary to carry
 out this subsection4 ,regulations to   
carry out paragraph 7#a77;,a7 shall be  
prescribed in consultation with the     
office or agency of the ,government of  
,puerto ,rico having jurisdiction over  
any retirement system referred to in    
paragraph 7#b77;,b74  #ajc4 ,powers of  
,council  7a7 ,hearings and sessions    
,the ,council may1 for the purpose of   
carrying out this ,act1 hold hearings1  
sit and act at times and places1 take   
testimony1 and receive evidence as the  
,council considers appropriate4 ,the    

,council may administer oaths or        
affirmations to witnesses appearing     
before it4  7b7 ,powers of members and  
agents ,any member or agent of the      
,council may1 if authorized by the      
,council1 take any action which the     
,council is authorized to take by this  
section4  7c7 ,obtaining official data  
7#a7 ,from ,federal ,government         
,notwithstanding sections #eeb 7commonly
 known as the ,freedom of ,information  
,act7 and #eeb;b 7the ,privacy ,act7 of 
title #e1 ,united ,states ,code1 the    
,council may secure directly from any   
department or agency of the ,united     
,states information necessary to enable 
it to carry out this ,act1 with the     
approval of the head of that department 
or agency4  7#b7 ,from ,government of   
,puerto ,rico ,notwithstanding any other
 provision of law1 the ,council shall   
have the right to secure copies of such 
records1 documents1 information1 or data
 from any entity of the ,government of  
,puerto ,rico necessary to enable the   

,council to carry out its               
responsibilities under this ,act4 ,at   
the request of the ,council1 the        
,council shall be granted direct access 
to such information systems1 records1   
documents1 information1 or data as will 
enable the ,council to carry out its    
responsibilities under this ,act4 ,the  
head of the entity of the ,government of
 ,puerto ,rico responsible shall timely 
provide the ,council with such          
information and assistance 7including   
granting the ,council direct access to  
automated or other information systems7 
as the ,council requires under this     
paragraph4  7d7 ,gifts1 bequests1 and   
devises ,the ,council may accept1 use1  
and dispose of gifts1 bequests1 or      
devises of services or property1 both   
real and personal1 for the purpose of   
aiding or facilitating the work of the  
,council4 ,gifts1 bequests1 or devises  
of money and proceeds from sales of     
other property received as gifts1       
bequests1 or devises shall be deposited 

in such account as the ,council may     
establish and shall be available for    
disbursement upon order of the chair4   
7e7 ,subpoena power  7#a7 ,in general   
,the ,council may issue subpoenas       
requiring the attendance and testimony  
of witnesses and the production of any  
evidence relating to any matter under   
investigation by the ,council4 ,the     
attendance of witnesses and the         
production of evidence may be required  
from any place within the ,united       
,states at any designated place of      
hearing within the ,united ,states4     
7#b7 ,failure to obey a subpoena ,if a  
person refuses to obey a subpoena issued
 under paragraph 7#a71 the ,council may 
apply to a ,united ,states district     
court for an order requiring that person
 to appear before the ,council to give  
testimony1 produce evidence1 or both1   
relating to the matter under            
investigation4 ,the application may be  
made within the judicial district where 
the hearing is conducted or where that  

person is found1 resides1 or transacts  
business4 ,any failure to obey the order
 of the court may be punished by the    
court as civil contempt4  7#c7 ,service 
of subpoenas ,the subpoenas of the      
,council shall be served in the manner  
provided for subpoenas issued by a      
,united ,states district court under the
 ,federal ,rules of ,civil ,procedure   
for the ,united ,states district courts4
  7#d7 ,service of process ,all process 
of any court to which application is    
made under paragraph 7#b7 may be served 
in the judicial district in which the   
person required to be served resides or 
may be found4  7f7 ,administrative      
support services ,upon the request of   
the ,council1 the ,administrator of     
,general ,services may provide to the   
,council1 on a reimbursable basis1 the  
administrative support services         
necessary for the ,council to carry out 
its responsibilities under this ,act4   
7g7 ,authority ,to enter into contracts 
,the executive director may enter into  

such contracts as the executive director
 considers appropriate 7subject to the  
approval of the chair7 to carry out the 
,council's responsibilities under this  
,act4  7h7 ,civil actions ,to enforce   
powers ,the ,council may seek judicial  
enforcement of its authority to carry   
out its responsibilities under this     
,act4  7i7 ,penalties  7#a7 ,acts       
prohibited ,any officer or employee of  
the ,government of ,puerto ,rico who--  
7,a7 takes any action in violation of   
any valid order of the ,council or fails
 or refuses to take any action required 
by any such order2 or  7,b7 prepares1   
presents1 or certifies any information  
7including any projections or estimates7
 or report for the ,council or any of   
its agents that is false or misleading1 
or1 upon learning that any such         
information is false or misleading1     
fails to immediately advise the ,council
 or its agents thereof in writing1 shall
 be guilty of a misdemeanor4  7#b7      
,administrative discipline ,in addition 

to any other applicable penalty1 any    
officer or employee of the ,government  
of ,puerto ,rico who knowingly and      
willfully violates paragraph 7#a7 shall 
be subject to appropriate administrative
 discipline1 including 7when            
appropriate7 suspension from duty       
without pay or removal from office by   
order of either the ,governor or        
,council4  7#c7 ,report by ,governor on 
disciplinary actions taken ,in the case 
of a violation of paragraph 7#a7 by an  
officer or employee of the ,government  
of ,puerto ,rico1 the ,governor shall   
immediately report to the ,council all  
pertinent facts together with a         
statement of the action taken thereon4  
#ajd4 ,exemption from liability for     
claims ,the ,council and its members may
 not be liable for any obligation of or 
claim against ,puerto ,rico resulting   
from actions taken to carry out this    
,act4  #aje4 ,treatment of actions      
arising from ,act  7a7 ,jurisdiction    
established in district court for       

,puerto ,rico ,except as provided in    
section #ajc7;e77#b7 7relating to the   
issuance of an order enforcing a        
subpoena71 any action against the       
,council or any action otherwise arising
 out of this ,act1 in whole or in part1 
shall be brought in the ,united ,states 
,district ,court for the ,district of   
,puerto ,rico4  7b7 ,prompt appeal  7#a7
 ,court of appeals ,notwithstanding any 
other provision of law1 any order of the
 ,united ,states ,district ,court for   
the ,district of ,puerto ,rico which is 
issued pursuant to an action brought    
under subsection 7a7 shall be reviewable
 only pursuant to a notice of appeal to 
the ,united ,states ,court of ,appeals  
for the ,first ,circuit4  7#b7 ,supreme 
court ,notwithstanding any other        
provision of law1 review by the ,supreme
 ,court of the ,united ,states of a     
decision of the ,court of ,appeals which
 is issued pursuant to paragraph 7#a7   
may be had only if the petition for such
 review is filed within #aj days after  

the entry of such decision4  7c7 ,timing
 of relief ,no order of any court       
granting declaratory or injunctive      
relief against the ,council1 including  
relief permitting or requiring the      
obligation1 borrowing1 or expenditure of
 funds1 shall take effect during the    
pendency of the action before such      
court1 during the time appeal may be    
taken1 or 7if appeal is taken7 during   
the period before the court has entered 
its final order disposing of such       
action4  7d7 ,expedited consideration   
,it shall be the duty of the ,united    
,states ,district ,court for the        
,district of ,puerto ,rico1 the ,united 
,states ,court of ,appeals for the      
,first ,circuit1 and the ,supreme ,court
 of the ,united ,states to advance on   
the docket and to expedite to the       
greatest possible extent the disposition
 of any matter brought under subsection 
7a74  #ajf4 ,funding for operation of   
,council  7a7 ,submission of budget ,the
 ,council shall submit a proposed budget

 for each fiscal year to the ,president 
for the inclusion in the annual budget  
of the ,united ,states4  7b7 ,contents  
of budget ,the budget shall describe--  
7#a7 expenditures of the ,council by    
each object class1 including            
expenditures for staff of the ,council2 
7#b7 services of personnel and other    
services provided by or on behalf of the
 ,council for which the ,council made no
 reimbursement2 and  7#c7 any gifts or  
bequests made to the ,council during the
 previous fiscal year4  7c7             
,appropriations ,no amount may be       
obligated or expended by the ,council   
for a fiscal year unless such amount has
 been approved by an ,act of ,congress1 
and then only according to such ,act4   
#ajg4 ,termination of activities ,the   
,council may not terminate its          
activities earlier than #c fiscal years 
after its establishment and until--     
7#a7 it has certified to the ,president 
that the ,government of ,puerto ,rico   
has made meaningful progress in its     

budgeting practices1 tax collection1 and
 its fiscal condition1 including access 
to the capital markets at a reasonable  
interest rate2 and  7#b7 the ,president 
has approved the ,council's             
certification in paragraph 7#a74  #ajh4 
,application of laws of ,puerto ,rico to
 ,council  7a7 ,in general ,the         
following laws of ,puerto ,rico 7as in  
effect on the date of the enactment of  
this ,act7 shall apply to the members   
and activities of the ,council3  7#a7   
,open ,meeting ,law4  7#b7 ,,foia       
,requirement4  7#c7 ,conflicts of       
,interest4  7b7 ,no control1            
supervision1 oversight1 or review by    
,governor or ,legislative ,assembly     
7#a7 ,in general ,neither the ,governor 
nor the ,legislative ,assembly may      
exercise any control1 supervision1      
oversight1 or review over the ,council  
or its activities4  7#b7 ,prohibition   
against legislation affecting authority 
,the ,legislative ,assembly shall have  
no authority to enact any act1          

resolution1 or rule with respect to the 
,council established under section      
#aja7;a7 of this ,act4  7c7 ,authority  
not subject to representation by ,puerto
 ,rico ,attorney ,general ,in any action
 brought by or on behalf of the         
,council1 and in any action brought     
against the ,council1 the ,council shall
 be represented by such counsel as it   
may select1 but in no instance may the  
,council be represented by the ,attorney
 ,general of ,puerto ,rico4  #aji4      
,rules of construction ,nothing in this 
,act may be construed-- 7#a7 to limit   
the authority of ,congress to exercise  
ultimate legislative authority over     
,puerto ,rico pursuant to article ,,iv1 
section #c1 clause #b of the            
,constitution of the ,united ,states2 or
  7#b7 to interfere with the right of   
the ,united ,states citizens of ,puerto 
,rico to determine whether to remain a  
territory1 become a ,state of the       
,united ,states of ,america1 or become a
 sovereign nation4  ,,ii                

,responsibilities of ,financial         
,stability ,council  #bja4 ,development 
of financial plan and budget for ,puerto
 ,rico  7a7 ,development of financial   
plan and budget ,for each fiscal year1  
the ,governor shall develop and submit  
to the ,council a financial plan and    
budget for ,puerto ,rico in accordance  
with this section4  7b7 ,contents of    
financial plan and budget ,a financial  
plan and budget for the ,government of  
,puerto ,rico for a fiscal year and the 
next #c fiscal years 7including the     
projected revenues and expenditures of  
each fund of the ,government of ,puerto 
,rico for such years71 shall satisfy the
 following requirements3  7#a7 ,the     
financial plan and budget shall meet the
 standards described in subsection 7c7  
to promote the financial stability of   
the ,government of ,puerto ,rico4  7#b7 
,the financial plan and budget shall    
provide for estimates of revenues and   
expenditures on a modified accrual      
basis4  7#c7 ,the financial plan and    

budget shall-- 7,a7 describe lump-sum   
expenditures by department by object    
class2  7,b7 describe capital           
expenditures 7together with a schedule  
of projected capital commitments of the 
,government of ,puerto ,rico and        
proposed sources of funding72  7,c7     
contain estimates of short-term and     
long-term debt 7both outstanding and    
anticipated to be issued72 and  7,d7    
contain cash flow forecasts for each    
fund of the ,government of ,puerto ,rico
 at such intervals as the ,council may  
require4  7#d7 ,the financial plan and  
budget shall include a statement        
describing methods of estimations and   
significant assumptions4  7#e7 ,the     
financial plan and budget shall include 
any proposal to specifically authorize  
an entity to be a debtor under #aa      
,u4,s4,c4 #aji4  7#f7 ,the financial    
plan and budget shall include any other 
provisions and shall meet such other    
criteria as the ,council considers      
appropriate to meet the purposes of this

 ,act1 including management initiatives 
to promote productivity1 improvement in 
the delivery of services1 or cost       
savings4  7c7 ,standards ,to promote    
financial stability described  7#a7 ,in 
general ,the standards to promote the   
financial stability of the ,government  
of ,puerto ,rico applicable to the      
financial plan and budget for a fiscal  
year are as follows3  7,a7 ,the ,council
 shall contract with an independent     
auditor to conduct a full scale audit of
 the financial practices and accounting 
methodologies employed by the           
,government of ,puerto ,rico1 and based 
on this report make recommendations for 
changes and improvements to be          
considered to be employed by the        
,council4  7,b7 ,during the first three 
years of the plan1 the ,government of   
,puerto ,rico shall make continuous1    
substantial progress toward equalizing  
the expenditures and revenues of the    
,government of ,puerto ,rico for such   
fiscal years 7in equal annual           

installments to the greatest extent     
possible74  7,c7 ,the financial plan and
 budget shall assure the continuing     
long-term financial stability of the    
,government of ,puerto ,rico1 as        
indicated by factors including access to
 short-term and long-term capital       
markets1 the efficient management of the
 ,government of ,puerto ,rico's         
workforce1 and the effective provision  
of services by the ,government of       
,puerto ,rico4  7#b7 ,application of    
sound budgetary practices ,in meeting   
the standards described in paragraph    
7#a7 with respect to a financial plan   
and budget for a fiscal year1 the       
,government of ,puerto ,rico shall apply
 sound budgetary practices1 including   
reducing costs and other expenditures1  
improving productivity1 improving tax   
collection1 or combinations of such     
practices4  #bjb4 ,process for          
submission and approval of financial    
plan and annual ,puerto ,rico budget    
7a7 ,submission of preliminary financial

 plan and budget by ,governor ,after    
consultation with the ,governor and     
,legislative ,assembly of ,puerto ,rico1
 the ,council shall set a date for the  
,governor to submit to the ,council and 
the ,legislative ,assembly a financial  
plan and budget for the fiscal year     
which meets the requirement of section  
#bja4  7b7 ,review by ,council ,upon    
receipt of the financial plan and budget
 for a fiscal year from the ,governor   
under subsection 7a71 the ,council shall
 promptly review the financial plan and 
budget4 ,in conducting the review1 the  
,council may request any additional     
information it considers necessary and  
appropriate to carry out its duties     
under this title4  7c7 ,action upon     
approval of ,governor's preliminary     
financial plan and budget  7#a7         
,certification to ,governor  7,a7 ,in   
general ,if the ,council determines that
 the financial plan and budget for the  
fiscal year submitted by the ,governor  
under subsection 7a7 meets the          

requirements applicable under section   
#bja--  7i7 the ,council shall approve  
the financial plan and budget and shall 
provide the ,governor1 the ,legislative 
,assembly1 the ,president1 and ,congress
 with a notice certifying its approval2 
and  7ii7 the ,governor shall promptly  
submit the financial plan and budget to 
the ,legislative ,assembly4  7,b7       
,deemed approval after #cj days  7i7 ,in
 general ,if the ,council has not       
provided the ,governor1 the ,legislative
 ,assembly1 the ,president1 and         
,congress with a notice certifying      
approval under subparagraph 7,a77i7 or a
 statement of disapproval under         
subsection 7d77#a7 upon the expiration  
of the #cj-;day period which begins on  
the date the ,council receives the      
financial plan and budget from the      
,governor under subsection 7a71 the     
,council shall be deemed to have        
approved the financial plan and budget  
and to have provided the ,governor1 the 
,legislative ,assembly1 the ,president1 

and ,congress with the notice certifying
 approval described in subparagraph     
7,a77i74  7ii7 ,explanation of failure  
to respond ,if clause 7i7 applies with  
respect to a financial plan and budget1 
the ,council shall provide the          
,governor1 the ,legislative ,assembly1  
the ,president1 and ,congress with an   
explanation for its failure to provide  
the notice certifying approval or the   
statement of disapproval during the     
#cj-;day period described in such       
clause4  7#b7 ,adoption of budget by    
assembly after receipt of approved      
budget ,not later than the date set by  
the ,council in subsection 7a7 after    
receiving the budget for the fiscal year
 from the ,governor under paragraph     
7#a77;,a77ii71 the ,legislative         
,assembly shall by ,act adopt a budget  
for the fiscal year which shall serve as
 the adoption of the budget of the      
,government of ,puerto ,rico for the    
fiscal year under such section1 and     
shall submit such budget to the         

,governor and the ,council4  7#c7       
,review of ,legislative ,assembly budget
 by authority ,upon receipt of the      
budget for a fiscal year from the       
,legislative ,assembly under paragraph  
7#b7 7taking into account any items or  
provisions disapproved by the ,governor 
or disapproved by the ,governor and     
reenacted by the ,legislative ,assembly7
 the ,council shall promptly review the 
budget4 ,in conducting the review1 the  
,council may request any additional     
information it considers necessary and  
appropriate to carry out its duties     
under this subtitle4  7#d7 ,results of  
authority review of ,legislative        
,assembly's initial budget  7,a7        
,approval of ,legislative ,assembly's   
initial budget ,if the ,council         
determines that the budget for the      
fiscal year submitted by the            
,legislative ,assembly under paragraph  
7#b7 meets the requirements applicable  
under section #bja--  7i7 the ,council  
shall approve the budget and shall      

provide the ,governor1 the ,legislative 
,assembly1 the ,president1 and ,congress
 with a notice certifying its approval2 
and  7ii7 the ,legislative ,assembly    
shall promptly submit the budget to the 
,governor for transmission to the       
,president and ,congress4  7,b7         
,disapproval of ,legislative ,assembly's
 initial budget ,if the ,council        
determines that the budget for the      
fiscal year submitted by the            
,legislative ,assembly under paragraph  
7#b7 does not meet the requirements     
applicable under section #bja1 the      
,council shall disapprove the budget1   
and shall provide the ,governor1 the    
,legislative ,assembly1 the ,president1 
and ,congress with a statement          
containing--  7i7 the reasons for such  
disapproval2 and  7ii7 any              
recommendations for revisions to the    
budget the ,council considers           
appropriate to ensure that the budget is
 consistent with section #bja7;b7 and   
7c74  7,c7 ,deemed approval after #ae   

days  7i7 ,in general ,if the ,council  
has not provided the ,governor1 the     
,legislative ,assembly1 the ,president1 
and ,congress with a notice certifying  
approval under subparagraph 7,a77i7 or a
 statement of disapproval under         
subparagraph 7,b7 upon the expiration of
 the #ae-;day period which begins on the
 date the ,council receives the budget  
from the ,legislative ,assembly under   
paragraph 7#b71 the ,council shall be   
deemed to have approved the budget and  
to have provided the ,governor1 the     
,legislative ,assembly1 the ,president1 
and ,congress with the notice certifying
 approval described in subparagraph     
7,a77i74  7ii7 ,explanation of failure  
to respond ,if clause 7i7 applies with  
respect to a budget1 the ,council shall 
provide the ,governor1 the ,legislative 
,assembly1 the ,president1 and ,congress
 with an explanation for its failure to 
provide the notice certifying approval  
or the statement of disapproval during  
the #ae-;day period described in such   

clause4  7#e7 ,authority review of      
,legislative ,assembly's revised budget 
7,a7 ,submission of ,legislative        
,assembly's revised budget ,not later   
than #ae days after receiving the       
statement from the ,council under       
paragraph 7#d77;,b71 the ,legislative   
,assembly shall promptly by ,act adopt a
 revised budget for the fiscal year     
which addresses the reasons for the     
,council's disapproval cited in the     
statement1 and shall submit such budget 
to the ,governor and the ,council4  7,b7
 ,approval of ,legislative ,assembly's  
revised budget ,if1 after reviewing the 
revised budget for a fiscal year        
submitted by the ,legislative ,assembly 
under subparagraph 7,a7 in accordance   
with the procedures described in this   
subsection1 the ,council determines that
 the revised budget meets the           
requirements applicable under section   
#bja1 the ,council shall approve the    
budget and shall provide the ,governor1 
the ,legislative ,assembly1 the         

,president1 and ,congress with a notice 
certifying its approval4  7,c7          
,disapproval of ,legislative ,assembly's
 revised budget  7i7 ,in general ,if1   
after reviewing the revised budget for a
 fiscal year submitted by the           
,legislative ,assembly under            
subparagraph 7,a7 in accordance with the
 procedures described in this           
subsection1 the ,council determines that
 the revised budget does not meet the   
applicable requirements under section   
#bja1 the ,council shall--  7,i7        
disapprove the budget2  7,,ii7 provide  
the ,governor1 the ,legislative         
,assembly1 the ,president1 and ,congress
 with a statement containing the reasons
 for such disapproval2 and  7,,iii7     
approve and recommend a budget for the  
,government of ,puerto ,rico which meets
 the applicable requirements under      
section #bja1 and submit such budget to 
the ,governor1 the ,legislative         
,assembly1 the ,president1 and          
,congress4  7ii7 ,transmission of       

rejected budget ,the ,legislative       
,assembly shall promptly submit the     
revised budget disapproved by the       
,council under this subparagraph to the 
,governor for transmission to the       
,president and ,congress4  7,d7 ,deemed 
approval after #ae days  7i7 ,in general
 ,if the ,council has not provided the  
,governor1 the ,legislative ,assembly1  
the ,president1 and ,congress with a    
notice certifying approval under        
subparagraph 7,b77i7 or a statement of  
disapproval under subparagraph 7,c7 upon
 the expiration of the #ae-;day period  
which begins on the date the ,council   
receives the revised budget submitted by
 the ,legislative ,assembly under       
subparagraph 7,a71 the ,council shall be
 deemed to have approved the revised    
budget and to have provided the         
,governor1 the ,legislative ,assembly1  
the ,president1 and ,congress with the  
notice certifying approval described in 
subparagraph 7,b77i74  7ii7 ,explanation
 of failure to respond ,if clause 7i7   

applies with respect to a budget1 the   
,council shall provide the ,governor1   
the ,legislative ,assembly1 the         
,president1 and ,congress with an       
explanation for its failure to provide  
the notice certifying approval or the   
statement of disapproval during the     
#ae-;day period described in such       
clause4  7#f7 ,deadline for transmission
 of a budget by authority               
,notwithstanding any other provision of 
this section each fiscal year the       
,council shall-- 7,a7 provide ,congress 
with a notice certifying its approval of
 the ,legislative ,assembly's initial   
budget for the fiscal year under        
paragraph 7#d77;,a72  7,b7 provide      
,congress with a notice certifying its  
approval of the ,legislative ,assembly's
 revised budget for the fiscal year     
under paragraph 7#e77;,b72 or  7,c7     
submit to ,congress an approved and     
recommended budget of the ,council for  
the ,government of ,puerto ,rico for the
 fiscal year under paragraph 7#e77;,c74 

7d7 ,action upon disapproval of         
,governor's preliminary budget  7#a7    
,statement of disapproval ,if the       
,council determines that the budget for 
the fiscal year submitted by the        
,governor under subsection 7a7 does not 
meet the requirements applicable under  
section #bja1 the ,council shall        
disapprove the budget1 and shall provide
 the ,governor and the ,legislative     
,assembly with a statement containing-- 
7,a7 the reasons for such disapproval2  
and  7,b7 any recommendations for       
revisions to the budget the ,council    
considers appropriate to ensure that the
 budget meets the requirements          
applicable under section #bja4  7#b7    
,authority review of ,governor's revised
 financial plan and budget  7,a7        
,submission of ,governor's revised      
financial plan and budget ,not later    
than #ae days after receiving the       
statement from the ,council under       
paragraph 7#a71 the ,governor shall     
promptly submit to the ,council and the 

,legislative ,assembly a revised        
financial plan and budget for the fiscal
 year which addresses the reasons for   
the ,council's disapproval cited in the 
statement4  7,b7 ,approval of           
,governor's revised financial plan and  
budget ,if the ,council determines that 
the revised financial plan and budget   
for the fiscal year submitted by the    
,governor under subparagraph 7,a7 meets 
the requirements applicable under       
section #bja--  7i7 the ,council shall  
approve the financial plan and budget   
and shall provide the ,governor1 the    
,legislative ,assembly1 the ,president1 
and ,congress with a notice certifying  
its approval2 and  7ii7 the ,governor   
shall promptly submit the financial plan
 and budget to the ,legislative         
,assembly4  7,c7 ,disapproval of        
,governor's revised financial plan and  
budget  7i7 ,in general ,if the ,council
 determines that the revised financial  
plan and budget for the fiscal year     
submitted by the ,governor under        

subparagraph 7,a7 does not meet the     
requirements applicable under section   
#bja1 the ,council shall--  7,i7        
disapprove the financial plan and       
budget2  7,,ii7 shall provide the       
,governor1 the ,legislative ,assembly1  
the ,president1 and ,congress with a    
statement containing the reasons for    
such disapproval2 and  7,,iii7 recommend
 a financial plan and budget for the    
,government of ,puerto ,rico which meets
 the requirements applicable under      
section #bja and submit such financial  
plan and budget to the ,governor and the
 ,legislative ,assembly4  7ii7          
,submission of rejected financial plan  
and budget ,the ,governor shall promptly
 submit the revised financial plan and  
budget disapproved by the ,council under
 this subparagraph to the ,legislative  
,assembly4  7,d7 ,deemed approval after 
#ae days  7i7 ,in general ,if the       
,council has not provided the ,governor1
 the ,legislative ,assembly1 the        
,president1 and ,congress with a notice 

certifying approval under subparagraph  
7,b77i7 or a statement of disapproval   
under subparagraph 7,c7 upon the        
expiration of the #ae-;day period which 
begins on the date the ,council receives
 the revised financial plan and budget  
submitted by the ,governor under        
subparagraph 7,a71 the ,council shall be
 deemed to have approved the revised    
financial plan and budget and to have   
provided the ,governor1 the ,legislative
 ,assembly1 the ,president1 and         
,congress with the notice certifying    
approval described in subparagraph      
7,b77i74  7ii7 ,explanation of failure  
to respond ,if clause 7i7 applies with  
respect to a financial plan and budget1 
the ,council shall provide the          
,governor1 the ,legislative ,assembly1  
the ,president1 and ,congress with an   
explanation for its failure to provide  
the notice certifying approval or the   
statement of disapproval during the     
#ae-;day period described in such       
clause4  7#c7 ,action by ,legislative   

,assembly  7,a7 ,adoption of financial  
plan and budget ,not later than #cj days
 after receiving the ,governor's        
approved revised financial plan and     
budget for the fiscal year under        
paragraph 7#b77;,b7 or 7in the case of a
 financial plan and budget disapproved  
by the ,council7 the financial plan and 
budget recommended by the ,council under
 paragraph 7#b77;,c77i77,,iii71 the     
,legislative ,assembly shall by ,act    
adopt a financial plan and budget for   
the fiscal year which shall serve as the
 adoption of the budgets of the         
,government of ,puerto ,rico for the    
fiscal year under such section1 and     
shall submit the financial plan and     
budget to the ,governor and the         
,council4  7,b7 ,review by authority    
,the financial plan and budget submitted
 by the ,legislative ,assembly under    
subparagraph 7,a7 shall be subject to   
review by the ,council and revision by  
the ,legislative ,assembly in the same  
manner as the financial plan and budget 

submitted by the ,legislative ,assembly 
after an approved preliminary financial 
plan and budget of the ,governor under  
paragraphs 7#c71 7#d71 7#e71 and 7#f7 of
 subsection 7c74  7e7 ,revisions to     
financial plan and budget  7#a7         
,permitting ,governor to submit         
revisions ,the ,governor may submit     
proposed revisions to the financial plan
 and budget to the ,council at any time 
during the year4  7#b7 ,process for     
review1 approval1 disapproval1 and      
,legislative ,assembly action ,except as
 provided in paragraph 7#c71 the        
procedures described in subsections 7b71
 7c71 and 7d7 shall apply with respect  
to a proposed revision to a financial   
plan and budget in the same manner as   
such procedures apply with respect to   
the original financial plan and budget1 
except that subparagraph 7,b7 of        
subsection 7c77#a7 7relating to deemed  
approval by the ,council of a           
preliminary financial plan and budget of
 the ,governor7 shall be applied as if  

the reference to the term #cj-;day      
period were a reference to #bj-;day     
period4  7#c7 ,exception for revisions  
not affecting appropriations ,to the    
extent that a proposed revision to a    
financial plan and budget adopted by the
 ,legislative ,assembly pursuant to this
 subsection does not increase the amount
 of spending with respect to any account
 of the ,government of ,puerto ,rico1   
the revision shall become effective upon
 the ,council's approval of such        
revision4  #bjc4 ,restrictions on       
borrowing by ,puerto ,rico  7a7 ,in     
general ,the ,government of ,puerto     
,rico may not borrow money unless the   
,council provides prior certification   
that both the receipt of funds through  
such borrowing and the repayment of     
obligations incurred through such       
borrowing are consistent with the       
financial plan and budget for the year4 
7b7 ,revisions to financial plan and    
budget permitted ,if the ,council       
determines that the borrowing proposed  

to be undertaken by the ,government of  
,puerto ,rico is not consistent with the
 financial plan and budget1 the         
,governor may submit to the ,council a  
proposed revision to the financial plan 
and budget in accordance with section   
#bjb7;e7 so that the borrowing will be  
consistent with the financial plan and  
budget as so revised4  7c7 ,borrowing   
described ,this section shall apply with
 respect to any borrowing undertaken by 
the ,government of ,puerto ,rico4  #bjd4
 ,effect of finding of noncompliance    
with financial plan and budget  7a7     
,submission of reports ,not later than  
#cj days after the expiration of each   
quarter of each fiscal year1 the        
,governor shall submit reports to the   
,council describing the actual revenues 
obtained and expenditures made by the   
,government of ,puerto ,rico during the 
quarter with its cash flows during the  
quarter1 and comparing such actual      
revenues1 expenditures1 and cash flows  
with the most recent projections for    

these items4  7b7 ,demand for additional
 information ,if the ,council           
determines1 based on reports submitted  
by the ,governor under subsection 7a71  
independent audits1 or such other       
information as the ,council may obtain1 
that the revenues or expenditures of the
 ,government of ,puerto ,rico are not   
consistent with the financial plan and  
budget for the year1 the ,council shall 
require the ,governor to provide such   
additional information as the ,council  
determines to be necessary to explain   
the inconsistency4  7c7 ,certification  
of variance ,after requiring the        
,governor to provide additional         
information under subsection 7b71 the   
,council shall certify to the           
,legislative ,assembly1 the ,president1 
and ,congress that the ,government of   
,puerto ,rico is at variance with the   
financial plan and budget unless--  7#a7
  7,a7 the additional information       
provides an explanation for the         
inconsistency which the ,council finds  

reasonable and appropriate2 or  7,b7 the
 ,government of ,puerto ,rico adopts or 
implements remedial action 7including   
revising the financial plan and budget  
pursuant to section #bjb7;e77 to correct
 the inconsistency which the ,council   
finds reasonable and appropriate1 taking
 into account the terms of the financial
 plan and budget2 and  7#b7 the         
,governor agrees to submit the reports  
described in subsection 7a7 on a monthly
 basis for such period as the ,council  
may require4  7d7 ,effect of            
certification ,if the ,council certifies
 to the ,secretary of the ,treasury that
 a variance exists1 the ,secretary shall
 withhold funds otherwise payable to    
,puerto ,rico under such ,federal       
programs as the ,council may specify    
7other than funds dedicated to making   
entitlement or benefit payments to      
individuals71 in such amounts and under 
such other conditions as the ,council   
may specify4  #bje4 ,recommendations on 
financial stability and management      

responsibility  7a7 ,in general ,the    
,council may at any time submit         
recommendations to the ,governor1 the   
,legislative ,assembly1 the ,president1 
and ,congress on actions the ,government
 of ,puerto ,rico or the ,federal       
,government may take to ensure          
compliance by the ,government of ,puerto
 ,rico with a financial plan and budget 
or to otherwise promote the financial   
stability1 management responsibility1   
and service delivery efficiency of the  
,government of ,puerto ,rico4  7b7      
,response to recommendations for actions
 within authority of ,government of     
,puerto ,rico  7#a7 ,in general ,in the 
case of any recommendations submitted   
under subsection 7a7 which are within   
the authority of the ,government of     
,puerto ,rico to adopt1 not later than  
#ij days after receiving the            
recommendations1 the ,governor or the   
,legislative ,assembly 7whichever has   
the authority to adopt the              
recommendation7 shall submit a statement

 to the ,council1 the ,president1 and   
,congress which provides notice as to   
whether the ,government of ,puerto ,rico
 will adopt the recommendations4  7#b7  
,implementation plan required for       
adopted recommendations ,if the         
,governor or the ,legislative ,assembly 
7whichever is applicable7 notifies the  
,council and ,congress under paragraph  
7#a7 that the ,government of ,puerto    
,rico will adopt any of the             
recommendations submitted under         
subsection 7a71 the ,governor or the    
,legislative ,assembly 7whichever is    
applicable7 shall include in the        
statement a written plan to implement   
the recommendation which includes--     
7,a7 specific performance measures to   
determine the extent to which the       
,government of ,puerto ,rico has adopted
 the recommendation2 and  7,b7 a        
schedule for auditing the ,government of
 ,puerto ,rico's compliance with the    
plan4  7#c7 ,explanations required for  
recommendations not adopted ,if the     

,governor or the ,legislative ,assembly 
7whichever is applicable7 notifies the  
,council1 the ,president1 and ,congress 
under paragraph 7#a7 that the           
,government of ,puerto ,rico will not   
adopt any recommendation submitted under
 subsection 7a7 which the ,government of
 ,puerto ,rico has authority to adopt1  
the ,governor or the ,legislative       
,assembly shall include in the statement
 explanations for the rejection of the  
recommendations4  ,,iii ,debt           
,restructuring  #cja4 ,amendment        
,section #aja7eb7 of title #aa1 ,united 
,states ,code1 is amended to read as    
follows3  7#eb7 ,the term ,state        
includes ,puerto ,rico and1 except for  
the purpose of defining who may be a    
debtor under chapter #i of this title1  
includes the ,district of ,columbia4  4 
#cjb4 ,effective date2 application of   
amendment  7a7 ,effective date ,except  
as provided in subsection 7b71 this     
title and the amendment made by this    
title shall take effect on the date of  

the establishment of the ,puerto ,rico  
,financial ,stability ,council under    
section #aja7;a7 of this ,act4  7b7     
,application of amendment ,the amendment
 made by this title shall apply with    
respect to-- 7#a7 cases commenced under 
title #aa of the ,united ,states ,code  
on or after the date of the             
establishment of the ,puerto ,rico      
,financial ,stability ,council under    
section #aja7;a7 of this ,act1 and  7#b7
 debts1 claims1 and liens created       
before1 on1 or after such date4  #cjc4  
,severability ,if any provision of this 
title or the application of such        
provision to any person or circumstance1
 is found to be unconstitutional1 the   
remainder of this title1 or the         
application of that provision to other  
persons or circumstances1 shall not be  
affected4