CBO: Puerto Rico Bill Won’t Have Significant Effect on Federal Deficit

House legislation aimed at addressing Puerto Rico’s $70 billion debt crisis will have “no significant net effect on the federal deficit,” according to the nonpartisan Congressional Budget Office.

A CBO score of H.R. 5278 on Friday said the bill’s federal oversight board would likely require $370 million in administrative costs, but the government of Puerto Rico would pay for those costs to offset any direct spending.

“All cash flows related to the oversight board established for Puerto Rico under H.R. 5278 should be recorded in the federal budget,” CBO said. “”More specifically, amounts provided by Puerto Rico to fund the board’s operations should be recorded in the federal budget as revenues, and subsequent expenditures should be recorded as federal direct spending because they would not be contingent on further legislation.”

On the creditor front, CBO said it’s unclear what effect the legislation will have if implemented.

“Because CBO is uncertain about how claims by creditors would be affected and the amount of losses that would occur as a result of the bill, CBO cannot determine whether the aggregate cost of the mandates on private entities would exceed the annual threshold established” in the Unfunded Mandates Reform Act “for private-sector mandates.”

That yearly threshold is currently $154 million.


Finance Brief: Trump to Nominate Peirce for SEC Seat

The White House said President Donald Trump plans to nominate Hester Maria Peirce, a former Senate aide who’s now director of the Financial Markets Working Group at George Mason University’s Mercatus Center, as a member of the Securities and Exchange Commission. Former President Barack Obama nominated Peirce, but she was not confirmed by the Senate.

Finance Brief: Week in Review & What’s Ahead

The White House said President Donald Trump intends to nominate former Treasury Department official and private equity investor Randal Quarles as the Federal Reserve’s bank supervisor. If confirmed by the Senate, Quarles would fill one of three vacant seats on the Fed’s board, as vice chairman for supervision.

Washington Brief: Week in Review & What’s Ahead

President Donald Trump defended his eldest son, Donald Trump Jr., after it was revealed that in June 2016 he met with a Russian lawyer who has ties to the Kremlin. The meeting came after he was led to believe the lawyer would provide damaging information about Democratic presidential candidate Hillary Clinton, and that the information was part of the Russian government’s effort to assist his father’s presidential campaign. The meeting included a Russian-American lawyer who’s a former Russian intelligence officer

Washington Brief: Trump Says He Didn’t Learn of Son’s Meeting With Russian Lawyer Until This Week

President Donald Trump said he did not hear “until a couple of days ago” about a June 2016 meeting between his son, Donald Trump Jr., and a Russian lawyer who might have had damaging information on Democratic presidential candidate Hillary Clinton. He also said he spent more than 20 minutes of his two-hour meeting last week with Russian President Vladimir Putin pressing him on election meddling.

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