A few thoughts on Tuesday’s oral arguments before the U.S. Supreme Court in the litigation over whether Puerto Rico’s Public Corporations Debt Enforcement and Recovery Act, an insolvency statute for certain of its government instrumentalities, is void, as the lower federal courts held, under Section 903 of the U.S. Bankruptcy Code.

While secured creditors are entitled to special rights in bankruptcy, those rights may differ depending on whether creditors have a statutory or consensual lien on their collateral.

A draft of the U.S. Treasury's proposed debt restructuring legislation began circulating earlier today.  The draft legislation would give Puerto Rico, as well as other U.S. territories, and their municipalities access to U.S. bankruptcy court under a new chapter of the U.S. Bankruptcy Code (so-called "Super Chapter 9").

It is said that muddy water is best cleared by leaving it be. The Supreme Court’s December 4 decision to review the legality of Puerto Rico’s local bankruptcy law, the Recovery Act, despite a well-reasoned First Circuit Court of Appeals opinion affirming the U.S. District Court in San Juan’s decision voiding the Recovery Act on the grounds that it conflicts with Section 903 of the U.S. Bankruptcy Code, suggests, at a minimum, that at least four of the Justices deemed the questions raised too interesting to let the First Circuit have the last word.

It is said that muddy water is best cleared by leaving it be.  The Supreme Court’s December 4 decision to review the legality of Puerto Rico’s local bankruptcy law, the Recovery Act, despite a well-reasoned First Circuit Court of Appeals opinion affirming the U.S. District Court in San Juan’s decision voiding the Recovery Act.

The Stephen Beck, Jr., Achieving a Better Life Experience Act of 2014 (ABLE Act), one of the few recent examples of bipartisan cooperation on a new category of tax and budget expenditure, is both well-intentioned in its principles and cumbersome in its details, another example of the proposition that a camel is a horse designed by a committee. 

On November 13, the IRS issued Notice 2015-78, providing favorable guidance on topics of interest to providers of “supplemental” or “alternative” student loans financed with tax-exempt bonds and to underwriters of such student loan bonds.

We are delighted and proud to share the news that our colleague Meghan Burke has been selected to receive the Freda Johnson Award for Trailblazing Women in Public Finance at the Bond Buyer's Deal of the Year ceremony in New York on December 3rd.

Last week, the Working Group for the Fiscal and Economic Recovery of Puerto Rico gave the broadest hint yet of the next tactic in Puerto Rico’s ongoing quest to deleverage itself.

The IRS’s recently-published proposed regulations for Section 529A qualified ABLE programs have taken some wind out of the sails of state program administrators and potential program managers who had hoped for regulations that hewed closer to the requirements in effect for qualified tuition programs under Section 529, on which Section 529A was based.