Steps Toward Settling Puerto Rico’s Debt

■ How much of Puerto Rico’s overall debt is because of the Puerto Rico Electric Power Authority?

Puerto Rico’s total debt, most of it in the form of municipal bonds, has a face value of about $72 billion. Of that amount, about $9 billion was issued by the power authority.

■ What are the next steps to help the authority get out from under the debt?

After the authority came to the brink of default in 2014, creditors agreed to work with it on a restructuring plan. The parties have now agreed on such a plan, which would reduce the principal amount by 15 percent and slow the payment schedule. They must now wait for Puerto Rican legislators to approve it and for a new regulatory body to authorize crucial elements. Puerto Rico’s government has begun calling for relief on most of its other debts, adding tremendous legal and political uncertainty.

■ What happens if creditors and the island’s government can’t agree on what to do about the debt?

On July 1, the authority has a scheduled debt payment of about $423 million, which it does not have the cash to pay. The consequences of missing the payment are unpredictable, but they could include widespread power disruptions on the island, which would set back economic activity and cause other hardships.

■ Is Congress going to help the island? If so, when and how?

Committees with relevant jurisdiction — over bankruptcy, government finances and territorial affairs — have been taking expert testimony on available options, but a consensus has yet to emerge. One idea now being discussed is putting Puerto Rico’s finances into the hands of a federal control board. But there are concerns that such a board might improperly curtail self-government on the island. Paul D. Ryan of Wisconsin, a Republican and the speaker of the House, has set an end-of-March deadline for a House proposal to aid Puerto Rico.

■ What are the next big moments coming up for Puerto Rico and its debt troubles?

The power authority’s July 1 payment is just one of almost $2 billion in debt payments due on that date from various branches of the Puerto Rican government. Puerto Rico is widely presumed to not have the cash, raising the prospect of a disorderly default. As a territory, Puerto Rico has no access to bankruptcy, and much of the negotiating going on now is seeking some alternative to bankruptcy that would also have the effect of holding off creditor lawsuits.

A view of San Juan Bay and the Palo Seco Power Plant owned by the Puerto Rico Electric Power Authority. Credit Christopher Gregory for The New York Times

By MARY WILLIAMS WALSH

Steps Toward Settling Puerto Rico’s Debt