Pensioners became the first group of creditors in Puerto Rico who requested active participation in the recently filed bankruptcy case for Puerto Rico under Title III of the PROMESA Act.

In addition, lawyers from the University of Puerto Rico and the American Federation of State, County and Municipal Employees (AFSCME), whose own case is related to the Fiscal Control Board (FCB), went to court to ask the judge, Laura Taylor Swain, who keeps the motion of the case, which is the first step that routinely takes a part that can be affected by the radiation of bankruptcy.

Pensioners, however, did not appear merely to be informed of the development of the case, but to request that the Pro Pensioners Movement (Movimiento Pro Pensionados), which was formed in January 2017 and which represents about 92,000 pensioners, is designated as the official representative of pensioners in the case of bankruptcy, which would put them at the forefront of negotiations that occur with that sector and its legal representation.

In fact, the group directly claims to be at the negotiations that the government and the Board intends to follow with different creditors even after filing bankruptcy and ask for power to represent the approximately 160,000 already retired employees and the equally approximately 160,000 employees that remain active in government and accumulating for their retirement.

The legal move of pensioners is the first of many that can occur of that type since, with the filing of bankruptcy, anyone to whom the government owes money becomes a creditors who would have to appear at court if wanting to watch and fight for its credit.

What would be the ‘Official Committee of Pensioners’ in the case of bankruptcy is composed of different organizations which groups pensioners from agencies such as the University of Puerto Rico, the Police, the State Insurance Corporation, the Department of Education and even pensioners who reside outside of Puerto Rico. The Association of Pensioners of the Government of Puerto Rico is the largest organization with 52,755 members. Only pensioners of the Electric Power Authority are not currently represented on the committee on which the American Association of Retired Persons (AARP) figured as ex-members.

The application was filed by lawyers Antonio Bennazar Zequeira of Puerto Rico and Clark Hill PLC of Michigan, which represented the retirement systems of Detroit City employees in their bankruptcy case. The representation of a group of pensioners, vis a vis the representation of the retirement systems, caused controversy in Detroit because the systems claimed that the pensioners should defend them instead of an ‘ad hoc’ group like the one now asked in the bankruptcy of Puerto Rico. Lawyers, the motions says, are not charging for their services at this time and have already met with lawyers from the FCB and the Government of Puerto Rico.

In Detroit the group of pensioners was about 32,000 while in Puerto Rico it would be 10 times more, about 320,000, retired and active.

Look at the list of member organizations below: