Conservative public affairs powerhouse DCI Group is continuing its lobbying push on Capitol Hill regarding Puerto Rico's ongoing debt issues, and has now hired Washington, D.C.-based PA and communications firm the Raben Group to lobby on behalf of the right-leaning communications shop as Congress weighs a potential restructuring of the U.S. Caribbean territory’s debt.
Puerto Rico, which owes tens of billions in outstanding debt — current estimates say more than $71 billion — on May 2 missed its first scheduled payment of nearly $400 million to creditors.
The island, which has been in economic doldrums for a decade, was formerly an attractive site of investment due to its tax exemption on municipal bonds. When the territory could not pay the interest on those bonds, it borrowed heavily from hedge funds and other financial firms as a means of balancing its budgets, pushing it further into debt.
The cash-strapped country expressed interest in utilizing chapter 9 bankruptcy protections as a means of restructured its debts — a la Detroit or Stockton, CA — but the existing federal bankruptcy code doesn’t extend those provisions to U.S. territories. As Capitol Hill continues to debate proposals on how to help the island resolve the debt crisis — including the possibility of a federal bailout, or an amendment of its bankruptcy rules — investors owed payment by Puerto Rico have hired lobbying help in a bid to stress their opposition to bankruptcy measures.
The New York Times in December reported that DCI had recruited Alexandria, VA-based conservative group 60 Plus Association to coordinate a media and lobbying effort against extending bankruptcy protections to Puerto Rico.
Robert Raben, a former aide to Congressman Barney Frank (D-MA) and assistant attorney general for legislative affairs, heads the Raben Group.
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