Puerto Rico’s Worst-Funded Pension Risks Bondholder Showdown
- Pension liabilities push island obligations to $113 billion
- Commonwealth and its agencies already owe $70 billion of debt
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As if $70 billion of debt wasn’t enough.
One of the toughest tasks that awaits the federal control board charged with overseeing Puerto Rico’s finances may be how to strengthen the island’s retirement system, the worst-funded pension program among U.S. states and territories. That’s because whatever is done will likely pit bondholders against public employees since the legislation authorizing the restructuring of the commonwealth’s obligations didn’t provide any fresh cash.