Puerto Rico Gov. Alejandro Garcia Padilla said in a televised speech Monday the island is going to default on its $422 million debt payment.
Padilla said he has issued an executive order to withhold payments for the majority of the debt after he was unable to negotiate a last-minute deal with creditors.
“The decision not to pay has been a very difficult one, and one that frankly I would rather not take,” the governor said, according to USA Today. “But faced with the inability to meet the demands of our creditors and the needs of our people, I had to make a choice. I decided that essential services for the 3.5 million American citizens in Puerto Rico came first.”
The commonwealth currently holds around $70 billion in debt and faces an even larger bill due at the start of July. Congress has been working on bill to address the island’s fiscal woes, missing a May 1 deadline to get something passed.
House Majority Leader [crscore]Kevin McCarthy[/crscore] said he is hopeful lawmakers will have something passed by July 1.
House Committee on Natural Resources Chairman [crscore]Rob Bishop[/crscore] said Friday he expects a redrafted version of legislation introduced in early-April to be released after the House returns from its week-long recess.
Republican members of Congress have made it clear they do not want taxpayers to be on the hook for the debt and are concentrated on getting the bill right.
“We do not want a bailout. We haven’t asked for a bailout. We haven’t been offered a bailout,” Padilla said.
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