The actions of the oversight board, and the details of the restructuring, have attracted the attention of members of Congress. The lawsuits center on Puerto Rico’s constitutional debt limit, which establishes a ceiling for the amount of general-obligation bonds the island’s government can issue. For example, the complaint said, bonds issued by Puerto Rico’s Public Buildings Authority to build and maintain public schools were to be repaid by rental payments on the buildings. But in fact, the rent payments were made by the government’s general fund — the same source of money that repays the general-obligation bonds. For that reason, the school-construction bonds should have been counted as general-obligation bonds, the lawsuit says.

Source: New York Times May 02, 2019 22:41 UTC