The purpose of the Oversight Board is to provide a method for a covered territory to achieve fiscal responsibility and access to the capital markets.
A Financial Oversight and Management Board is hereby established for Puerto Rico.
The Congress enacts this chapter pursuant to article IV, section 3 of the Constitution of the United States, which provides Congress the power to dispose of and make all needful rules and regulations for territories.
An Oversight Board established under this section-
An Oversight Board, in its sole discretion at such time as the Oversight Board determines to be appropriate, may designate any territorial instrumentality as a covered territorial instrumentality that is subject to the requirements of this chapter.
The Oversight Board may require, in its sole discretion, the Governor to submit to the Oversight Board such budgets and monthly or quarterly reports regarding a covered territorial instrumentality as the Oversight Board determines to be necessary and may designate any covered territorial instrumentality to be included in the Territory Budget; except that the Oversight Board may not designate a covered territorial instrumentality to be included in the Territory Budget if applicable territory law does not require legislative approval of such covered territorial instrumentality's budget.
The Oversight Board in its sole discretion may or, if it requires a budget from a covered territorial instrumentality whose budget does not require legislative approval under applicable territory law, shall designate a covered territorial instrumentality to be the subject of an Instrumentality Budget separate from the applicable Territory Budget and require that the Governor develop such an Instrumentality Budget.
The Oversight Board may require, in its sole discretion, the Governor to include a covered territorial instrumentality in the applicable Territory Fiscal Plan. Any covered territorial instrumentality submitting a separate Instrumentality Fiscal Plan must also submit a separate Instrumentality Budget.
The Oversight Board may designate, in its sole discretion, a covered territorial instrumentality to be the subject of an Instrumentality Fiscal Plan separate from the applicable Territory Fiscal Plan and require that the Governor develop such an Instrumentality Fiscal Plan. Any covered territorial instrumentality submitting a separate Instrumentality Fiscal Plan shall also submit a separate Instrumentality Budget.
An Oversight Board, in its sole discretion, at such time as the Oversight Board determines to be appropriate, may exclude any territorial instrumentality from the requirements of this chapter.
A territorial instrumentality excluded pursuant to this paragraph shall not be considered to be a covered territorial instrumentality.
The Governor, or the Governor's designee, shall be an ex officio member of the Oversight Board without voting rights.
The voting members of the Oversight Board shall designate one of the voting members of the Oversight Board as the Chair of the Oversight Board (referred to hereafter in this chapter as the "Chair") within 30 days of the full appointment of the Oversight Board.
Each appointed member of the Oversight Board shall be appointed for a term of 3 years.
The President may remove any member of the Oversight Board only for cause.
Upon the expiration of a term of office, a member of the Oversight Board may continue to serve until a successor has been appointed.
An individual may serve consecutive terms as an appointed member, provided that such reappointment occurs in compliance with paragraph (6).
A vacancy on the Oversight Board shall be filled in the same manner in which the original member was appointed.
An individual is eligible for appointment as a member of the Oversight Board only if the individual-
Members of the Oversight Board shall serve without pay, but may receive reimbursement from the Oversight Board for any reasonable and necessary expenses incurred by reason of service on the Oversight Board.
As soon as practicable after the appointment of all members and appointment of the Chair, the Oversight Board shall adopt bylaws, rules, and procedures governing its activities under this chapter, including procedures for hiring experts and consultants. Such bylaws, rules, and procedures shall be public documents, and shall be submitted by the Oversight Board upon adoption to the Governor, the Legislature, the President, and Congress. The Oversight Board may hire professionals as it determines to be necessary to carry out this chapter.
Under the bylaws adopted pursuant to paragraph (1), the Oversight Board may conduct its operations under such procedures as it considers appropriate, except that an affirmative vote of a majority of the members of the Oversight Board's full appointed membership shall be required in order for the Oversight Board to approve a Fiscal Plan under section 2141 of this title, to approve a Budget under section 2142 of this title, to cause a legislative act not to be enforced under section 2144 of this title, or to approve or disapprove an infrastructure project as a Critical Project under section 2213 of this title.
The Oversight Board may incorporate in its bylaws, rules, and procedures under this subsection such rules and regulations of the territorial government as it considers appropriate to enable it to carry out its activities under this chapter with the greatest degree of independence practicable.
Upon a majority vote of the Oversight Board's full voting membership, the Oversight Board may conduct its business in an executive session that consists solely of the Oversight Board's voting members and any professionals the Oversight Board determines necessary and is closed to the public, but only for the business items set forth as part of the vote to convene an executive session.
48 U.S.C. § 2121
EDITORIAL NOTES
REFERENCES IN TEXTThis chapter, referred to in subsecs. (b)(2), (d)(1)(A), (2)(A), (e)(4), and (h)(1), (3), was in the original "this Act", meaning Pub. L. 114-187, 130 Stat. 549, known as the Puerto Rico Oversight, Management, and Economic Stability Act and also as PROMESA, which is classified principally to this chapter. For complete classification of this Act to the Code, see Short Title note set out under section 2101 of this title and Tables.
- Bond
- The term "Bond" means a bond, loan, letter of credit, other borrowing title, obligation of insurance, or other financial indebtedness for borrowed money, including rights, entitlements, or obligations whether such rights, entitlements, or obligations arise from contract, statute, or any other source of law, in any case, related to such a bond, loan, letter of credit, other borrowing title, obligation of insurance, or other financial indebtedness in physical or dematerialized form of which the issuer, obligor, or guarantor is the territorial government.
- Budget
- The term "Budget" means the Territory Budget or an Instrumentality Budget, as applicable.
- Fiscal Plan
- The term "Fiscal Plan" means a Territory Fiscal Plan or an Instrumentality Fiscal Plan, as applicable.
- Governor
- The term "Governor" means the chief executive of a covered territory.
- Instrumentality Budget
- The term "Instrumentality Budget" means a budget for a covered territorial instrumentality, designated by the Oversight Board in accordance with section 2121 of this title, submitted, approved, and certified in accordance with section 2142 of this title.
- Instrumentality Fiscal Plan
- The term "Instrumentality Fiscal Plan" means a fiscal plan for a covered territorial instrumentality, designated by the Oversight Board in accordance with section 2121 of this title, submitted, approved, and certified in accordance with section 2141 of this title.
- Legislature
- The term "Legislature" means the legislative body responsible for enacting the laws of a covered territory.
- Oversight Board
- The term "Oversight Board" means a Financial Oversight and Management Board established in accordance with section 2121 of this title.
- Puerto Rico
- The term "Puerto Rico" means the Commonwealth of Puerto Rico.
- Territory Budget
- The term "Territory Budget" means a budget for a territorial government submitted, approved, and certified in accordance with section 2142 of this title.
- Territory Fiscal Plan
- The term "Territory Fiscal Plan" means a fiscal plan for a territorial government submitted, approved, and certified in accordance with section 2141 of this title.
- covered territorial instrumentality
- The term "covered territorial instrumentality" means a territorial instrumentality designated by the Oversight Board pursuant to section 2121 of this title to be subject to the requirements of this chapter.
- covered territory
- The term "covered territory" means a territory for which an Oversight Board has been established under section 2121 of this title.
- territorial government
- The term "territorial government" means the government of a covered territory, including all covered territorial instrumentalities.
- territory
- The term "territory" means-(A) Puerto Rico;(B) Guam;(C) American Samoa;(D) the Commonwealth of the Northern Mariana Islands; or(E) the United States Virgin Islands.