Trump to nominate Puerto Rico oversight board

The White House said Monday that it will nominate the current members of Puerto Rico's federally appointed oversight board, following a legal challenge over whether their appointments were proper.

"In light of a recent decision from the United States Court of Appeals for the First Circuit, President Donald J. Trump today announced his intent to nominate the current seven members of the Financial Oversight and Management Board for Puerto Rico to fill out the remainder of the three-year terms to which they were initially appointed in 2016," a White House statement said.

Members of the Financial Oversight and Management Board for Puerto Rico were appointed in 2016 by President Barack Obama on the recommendation of Congress and were not subject to Senate confirmation.

The case challenging the board's authority was brought by Aurelius Capital Management and Assured Guaranty Corp. in an unsuccessful bid to dismiss Puerto Rico's bankruptcy cases involving bondholders and other creditors.

On Feb. 15, the 1st U.S. Circuit Court of Appeals in Boston ruled that oversight board members were not constitutionally appointed, but did not dismiss the claims. It allowed 90 days for the White House and Senate to constitutionally validate the board or reconstitute it. The oversight board also petitioned the U.S. Supreme Curt to review the decision.

The White House statement said that mismanagement by politicians in Puerto Rico "led to over a hundred billion dollars in debt and unfunded liabilities that directly hurt the citizens with broken promises, poor services, a bloated bureaucracy and dilapidated infrastructure. ... The most important component for future health and growth of Puerto Rico is financial constraint, reduced debt, and structural reforms. The work of the Financial Oversight and Management Board for Puerto Rico is providing the stability and oversight needed to address these chronic issues that will bring hope of a brighter future for Puerto Rico."

In its own statement, the oversight board said that it "has renegotiated a significant part of Puerto Rico's debt and is confident that it will reach more agreements soon."