In their first public report to Congress, the Fiscal Control Board (FCB) explained the strategy they are using when negotiating, revealed what will happen when the stay on the loans ends in May 1 st , confirmed that their purpose in the island is that the bondholders can receive their dues, but also assured that the there is no more cake to be spread around making payments that are not included in the Fiscal Plan without affecting the capacity of Puerto Rico to once again have economic growth.

In that sense, the President of the FCB, José Carrión III, finalized his report, exhorting Congress to help grow the cake through the approval of more funds for Health and issuing other means of economic growth included in the Congressional Task Force report on the economic development of Puerto Rico.

'The [ FCB ] shares the wishes of the bondholders of raising the available funds for the payment of the debt', but they cannot do it without violating a mandate in PROMESA of adjusting to an analysis of payment capacity, Carrión said to the senators as he maintained that this analysis leads to the conclusion that no more cuts can be made in the Government without provoking a downward spiral that would make it impossible for the island to return to the road of economic development.

'To impose more cuts would create an effect opposite of what the creditors want', he emphasized. With the cuts as they are, the Board hopes the economic development will be delayed until 2024.

According to the letter sent to senators Thom Tillis and Tom Cotton, who had previously sent communications to the Board of the worries of certain bondholders with the Fiscal Plan, the FCB's plan, in the face of the end of the stay, is to take the negotiations being had with the creditors and turn them into cases under the Title III of the Promesa Law. This title provides a special process, a sort of bankruptcy, for the restructuring of the debt under judicial supervision. The decision responds that in that manner, the judicial claims of the creditors can be kept paralyzed so they cannot do anything such as embargo orders against goods of the Government of Puerto Rico. The process that would start on May 2ndis the one under which debts can be restructured such as the pensions debts and others that are not backed up with bonds.

The Board pointed out that, in this very year, Puerto Rico faces two brutal Budget precipices: the funds in the Retirement System run out, so the government must start to assume the payments of the pension plans from the General Fund (Around $989 million for the 2018 fiscal year), and the additional funds the island had for Health system thanks to the Obamacare, run out.

On the Pensioners, the Board illustrated that the current plan takes the possible cuts to the limit and that cutting more would lead the pensioners below the $1000 monthly poverty limit of the federal government. This $1000 would be a combination of payments from the Social Security and Pension payments.

On the hermetic process of negotiations and mediation that is being done between the Board, the government and its creditors, the letter reveals that the bondholders have refused to accept consensual agreements of debt restructuring until the Board certifies a plan that contains more than the $787 million annually being used now for the payment of the debt.

The Board establishes that they have had over 30 meetings with creditor groups, some on more than one occasion, and that the mediation between the creditors of COFINA and General Obligations, which between each other hold 5% of the debt and are the protagonists of a heavy confrontation to annul the credit agreement of one another, started on April 13 under the watchful eye of the bankruptcy exjudge Allan Gropper.

Carrion also told the senators that the same creditors that went whining are the ones that want a different plan.