Puerto Rico oversight board sues to stop new pension benefits
The Financial Oversight and Management Board for Puerto Rico said it filed a lawsuit to stop the local government from offering public workers billions in new retirement benefits that it says will undermine the island’s long-sought plan to restructure its debt.
In a statement issued Monday, the board said it had filed the suit in Puerto Rico District Court to stop the pension measures — known as Act 80, Act 81, and Act 82 — because they are being pushed forward without sufficient analysis about how to pay for their costs.
The board estimates the three laws could increase government expenses by as much as $8.3 billion over the next 30 years. Even partially implementing Act 80, which promotes early retirement, could cost the government an additional $61 million in the first year, the board said.
The lawsuit comes as Puerto Rico nears the end of a four-year bankruptcy process. The island, along with the oversight board and other parties, have negotiated a plan that would reduce public debt by $33 billion.
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