McCarthy ‘Hopeful’ House Will Pass Puerto Rico Bill by July 1by
Majority leader says House will miss May 1 debt payment date
Island could default on $2 billion in July without help
The No. 2 Republican in the U.S. House conceded Tuesday that Congress will miss one deadline for action on a bill to address Puerto Rico’s debt woes, and he didn’t commit to acting before an even more critical July 1 payment the island must make.
"I’m hopeful we’ll have it out of the House by then," Majority Leader Kevin McCarthy of California told reporters, about July 1. That’s when a $2 billion payment by Puerto Rico is due, including $805 million for its generation-obligation bonds, which are seen as the island’s most sacrosanct debt.
McCarthy also said, "I don’t see how" the House would be able to act before May 1, five days from now, when Puerto Rico faces a $422 million debt payment. Any measure would also have to be passed by the Senate.
The majority leader blamed the delay on questions raised by U.S. Treasury officials, saying the timetable now depends on "as soon as we can get Treasury to get done with what they are working on."
McCarthy’s suggestion that Treasury is responsible for the delay in action brought a sharp response from White House spokesman Josh Earnest.
"I strongly disagree and fortunately the facts are on my side," said Earnest, during a press briefing. He cited an Oct. 21 Bloomberg News story on the administration offering plan for Puerto Rico.
Earnest called it "a little ironic" that McCarthy would blame the administration for causing the delay "188 days" after the administration outlined its plan. He added, "If he feels the need to come out and criticize the Obama administration even though it’s false because he’s feeling some political pressure to act, that might be some evidence" that Congress will soon act.
There has, however, also been significant opposition to the latest draft of the bill from Republicans on the Natural Resources Committee, as well as many Democrats. The committee was forced to scrap a planned April 14 session to amend the measure, H.R. 4900, and has yet to reschedule it. The House will also take a one-week recess next week, further delaying action.
"The one thing the speaker always wants to make sure is to protect the taxpayers, that we don’t have a bailout here," said McCarthy.
Earlier on Tuesday, Speaker Paul Ryan said on "CBS This Morning" that the Natural Resources Committee continues to work on the "technical aspects" of a bill that he said ultimately would be "bipartisan." The Puerto Rico crisis is emerging as the speaker’s biggest test to date.
He explained the bill will have a financial oversight board for the territory and mechanisms to help it restructure its debts, and he emphasized, "there will be no taxpayer bailout of Puerto Rico."
McCarthy said there are some misleading TV and radio ads running "from some individuals who want to pick winners and losers and have some financial interests in this."
"Yes, it’s difficult when people misstate what the bill is," he said.
"We’ve been working on this for some time. There’s been some hiccups along the way," said McCarthy. "The most important thing to do here is to get it right," he said.
Senate Majority Leader Mitch McConnell told reporters Tuesday that he was waiting for the House to act first.
“We know it needs to be dealt with,” he said.