>> the prime minister to vote to lead the eu could lead to the disintegration of the united kingdom. so does that mean the european government, able to view would mean there would be a second independence referendum in scotland? and if not, what did the prime minister mean by that statement? >> i think, i certainly don't believe that the prime minister mint or would wish to indicate, and i certainly wish to indicate, that the eu referendum has anything to do with the scottish independence referendum. ..

there will be a pretty chaotic situation within the country as we adjust to the changes that that would bring about and unlikely lengthy period that that would take to negotiate a new settlement of whatever kind of relationship that we are going to have with the remaining eu. >> can i just say, i'm not particularly sure that that's what the prime minister was intending, can i ask you, is there no possibility, likelihood that scottland will remain in european union? polls seems 50/50. is there a possibility voters remain with the rest of uk and will vote to be out. what will be the uk government's

message? we just have to accept, do we have a message for the people of scottland? >> when we had the independence referendum in 2014 there was a lot of discussions whether we would have this referendum in relation to membership of the -- >> i recall that conversation about the eu. it could only be voting no with almost like guaranty of membership. >> obviously, obviously we are just not going to degree on that interpretation of the debate around the independence referendum. i recall on many occasions those who favored scottland leaving the uk arguing that a -- that eu referendum and that a -- there was a potential for scottland

and britain to leave the eu in that referendum. i think that issue has been -- has been -- my message to people in scottland and i would hope it would be the snp's message is to come out and vote to remain. you have to follow it through because between the uk general election when # .5 million people voted snp and the scottish parliament when 1 million voted voted snp, 400,000 people didn't come out to vote. so i think your energy should be out there getting people out to vote to remain in the eu if that's what you really believe in. >> the support for the remain -- significant higher for the united kingdom. >> a number of people who voted in election are two quite different things and those who

want scottland to remain in the eu is to get people out to the polls and cast votes to get a vote in scottland and the united kingdom. >> i will try for the last time. i will ask you again, if scottland is drived out of the european union, will the uk do in response? >> the message from the uk government, will determine across the uk. it's interesting to know the weekend, we're talking about polls which indicated that the majority of people in scottland, if scottland wants to leave, if there was a vote to leave the eu, even though scottland vote today remain in the eu would not favor a second independence referendum. that was very, very clear from that. >> a few hands are going up. >> just a very quick question in

terms of vote and make it relevant to them. >> yes. >> can you el us tangible benefits to individuals and families in scottland of remaining in the uk -- i mean, eu? [laughter] >> the latter is employment. hundreds of thousands of people in scottland come, the opportunity to move around the eu to secure employment in other parts of the eu, the opportunity to pay lower prices within a household than would otherwise be the case. i think these economic arguments are the ones that are the strongest and i also believe

that we are safer, more secure, we have more influence as part of the eu, the eu in scottland has been positive for remote island community. for example, a lot of specifics there. i think people's lives in scottland have been enhanced by part of the eu. i don't, on the other hand, accept that they would be less so because it's negative campaign and it's important to -- >> we're grateful. >> let me give you some of those gains. scottish people when they travel to any other country, eu, will be able to have very low mobile phone data charges.

those charges phased out entirely within the next year or so. if you're running a financial service's company in edinburg your company has a passport to operate anywhere in any of the 28 european countries, plain people making wealth work back in scottland. you can fly from a scottish airport inexpensively to all parts of the european union because a common system of aviation regulation across europe have swept away the old national restrictive practices and protection of national flag carriers that kept european airfares prohibitive in the past. a lori driver, you could drive in aberdeen to athens with just a single set of paperwork to

cover your driver and your con saturday-- consignment, if you're producing food or drink in scottland, if they need, the scottish, the uk, also the european and other standards can be sold freely anywhere around the european union. so, of course, scotts can travel anywhere else in the european union on the same basis as the citizens of those of the eu counties. >> thank you. christopher. >> so when i could address -- so let me just say this about scottland, a decision that could ultimately lead to

disintegration. doesn't fit in by earlier remarks. >> i think you would be clear of things said within scottland but there's no doubt that some people would attempt to use a a vote by the uk to leave the eu as an opportunity to put extra, extra effort into a campaign for independence of scottland from the rest of the united states. >> you already said that they wouldn't succeed in that. by reminding the people of england and the rest of the united kingdom of this, the plan to basically scare mongering.

if you believe why do you think it's acceptable that we are not able to have evidence from the united kingdom minister on the very important issue of fishing and not able to have evidence because both those members of the government happen to take a different view and support the lead campaigns. is it not unfair because of the stance they are taking? >> my understanding is that both of those ministers have set out clearly their views, and if you wish to know what their views are, you would be able to clearly understand them. but i think you do -- accept that there is a uk government position in relation to this referendum. and in terms of a -- in terms of setting out that position, that's the rule of uk ministers

who are not for leaving the eu. that is -- that is the basis on which it was agreed that members of the cabinet and other ministers would still be able to remain members of the cabinet and ministers while making a case against the position that the government has adopted. so i don't deny that these are somewhat unusual circumstances, but i think when the process begins and the prime minister made clear with, i think everyone did understand where we stood and that it would be unlikely the ministers offering a different position which would be giving a view as part of the government. >> today you may not have the chance to be present but steve hillson, former adviser of the

prime minister was making a speech basically saying that all conservative modernizers, that was where the optimistic future decentralized and i don't know if you regarded yourself as a conservative modernizer and left behind as a result of what has happened. can i ask you this? financial transaction tax, the chancellor has said the financial transaction tax may apply to the united kingdom. he said that he would fight that in the european court of justice, but in the same way as the european court of justice ruled against the scottish government to minimum alcohol pricing, they could have done same on financial tax and damaged the scottish financial

affairs industry. >> look, on first point, i've always had a high regard for mr. hillton. so i'm prepared to, you know, look at these different statements and take different views on different statements ii don't agree with the statement that he's made today. i do think that if you're the member of a larger organizations, those organizations have rules and you have to accept -- you have to accept the judgments that come from that. you can't within that environment have always your own way and get the judgment that you would want, but likewise, i don't accept that if britain was out with the eu we were just

able to do everything that we wanted. of course, we would still be bound by the realities of the international community. >> we have ten minutes so as many members as possible with questions. >> very quickly, a supplementary question. tell me do you wish the prime minister never put this question to the people of the uk. it seems conservatives south and north of the border, some of which are brand new to scottland here. i mean, when you talk about the uk position, how do you include it or exclude the 141 that are going to be supporting here? >> i don't think you're going to argue that every single person in scottland supports --

>> i think you mentioned the scottish parliament. it would demonstrate if every single member of the scottish parliament was in favor of scottland remaining in the eu. that would not be reflective of public opinion in scottland. i expect a decisive vote in scottland to remain in the eu but i'm not pretending that every single person in scottland is supporting remaining in the eu. i know one person who is not and there were reports in the sun newspaper today that's going to be an s&p group. i think it's important that public opinion is reflected in the scottish parliament, but i have enormous faith in the people of scottland and the people of the united kingdom. i consider the biggest decision in the lifetime by vote to go remain in the united kingdom. i trusted them with that

decision. i would have respected that decision. i trust and respect the people of the united kingdom to make this choice. >> so my point being is do you not agree that there are elected members of the conservative party who are well advised on this issue? >> i think a large number of people vote today remain in the eu but a large number of people would have voted to leave the eu. it's quite right that their views are reflected in parliament and we said it's not for mp's to decide, it's not for the prime minister, it's not for me, the people of the united kingdom will decide and then respect that result and move forward. >> i appreciate that, the key point i'm trying to make from a public perception, it's very

difficult a clear message to remain within the eu. >> my colleagues who are in favor of remaining in the eu, are part of a -- part of a lead campaign want to leave. it's a simple as that. do i have knowledge that there are people in the conservative people party want to leave the eu, yes, there are. other people want to stay, yes, they are but they will decide. the people in the united kingdom will decide. >> this is a very much a referendum, it's like two fighting over a comb. [laughter] >> i'm sorry.

you brought this, manifesto, how does it make it much more about conservative party -- and i know there's no desire. [inaudible] >> on the manifesto commitment. >> well, let's -- i'm very happy to take your advice in such manners. obviously we have two referendums in the last parliament, one changed the voting system and one for scottland to leave the united kingdom. i think it was on the losing side on both of the referendums. what happened in the 2011 election when s&p supported

adoption of av people rejected it but still voted for s&p-majority governments. they with separate out these issues. they can separate out where they stand on the issue of scottland remaining in the eu. but if you want scottland to remain in the eu, be positive about it. i haven't had a single positive -- i haven't had a single positive thing from you, mr. wishart. you be positive as well. your party be positive, the prime minister be positive and we all achieve common objective of scottland and uk remaining in the eu. >> he represents a significant number of people in the subject of european and we can't ignore that reality and it is a

position many people do hold. towards your question directly, chairman, i'd say don't go out and say first of all, how people in scottland benefit from the free-trade single market in the european union, how people in scottland benefit from the leverage in global trade of 500 million people, scottish businesses benefiting directing from the korea free-trade deal 2010, how the uk shapes the eu and global position on climate change. tell them how eu membership makes scott favor because we can opt and data sharing information arrangements between police forces across region and brought iran to negotiating table over the nuclear program and enabled

in the indian ocean to be weakened enormously. >> not the chancellor given the positiveness. [laughter] >> if the uk does leave the eu that would be significant changes to the scottish parliament as it is a policy controlled by the eu, have you looked at how affects settlement? >> we haven't made a -- as has been indicated on a number of cases, i -- that is not a uk government position. the uk government position is to argue, scottland remain in the eu. obviously, the view of the point

is made self-evident that would be significant for scottish parliament as well as uk if there was a vote to leave. >> there would be a huge amount of uncertainty. i mean, to take one of those issues, which is fisheries. uk left the european union, there would be instant control by uk authorities over uk waters. we would still be subject to united nations convention governing migrant trade fish stops. the uk would have to find a way to negotiate right of access to third-country waters which are fleets fishing but currently been negotiating through eu agreements with those countries and we would have to deal with the issue of many cases the long-standing rights of access

by our fishermen to other country's waters and elements to our waters. yes, it is right, under the scottland act, the operations of such a new regime would fall in administration. >> you brought this referendum and we have fear taken out. the conservative government will have delivered that and there's no contingency. i think people will find that absolutely appalling. it's subject to eu law. are you saying that nothing scottland taken over the union? >> i'm surprised, wishat that

the parliament plead significant part, that you have not stated before because that's clearly the position. the position is the uk government are arguing for scottland to remain in. mr. livington that a vast number of area, everything would have to be subject to negotiation. i think that you and your colleagues, for example, would want to echo the points that mr. livington made in the complexities of fishing across the eu because when i was aberdeen, there was a large number of people who were from the fishing communities who were wanting to leave the eu because they believe it would make this change, clearly it wouldn't. >> i think we all enjoy the session as i said, unless any

colleagues -- [inaudible] >> very, very grateful. sorry to call you. thank you both very much. >> thank you. >> president obama's asia trip continues, today he travels to hiroshima, first u.s. president to visit the japanese city where the u.s. dropped an atomic bomb august 6th, 1949. >> on wednesday and thursday june 1st and 2nd, c-span will be live in laredo, texas to talk about immigration and trade issues affecting the region and the country. on wednesday we will look at immigration with brandon darby

managing director. he talks about the flow of immigration and the players involved as well as efforts to cover security and humanitarian efforts of the issue. local immigration lawyer will discuss practicing law in the area. and alfredo, dallas morning news bureau chief exams the cartels in méxico. midnight in méxico, reporters journey through a party through darkness. congressman henry of texas will also join us to talk about how trade benefits laredo and the country. bob cash, state director, critic, looks at how the trade

deal took jobs from southern texas to méxico and how it hurts mexicans as well. be sure to watch washington journal from laredo, texas. join the discussion. >> i think today we in, effect, catch up with the 20th century. we've been the invisible half of the congress in the past seven years. we have watched our house colleagues with interest, at least i have with interest and the tv coverage of members of our colleagues in the house. >> today as the u.s. senate comes out of the communication's dark ages, we create another historic moment in the relationship between congress and technological advancements in communications through radio and television. 50 years ago our executive branch began appearing on

television. today marked the first time when our legislative branch in its entirety will appear on that medium of communication through which most americans get their information about what our government and our country does. >> the televising also represents a wise and warranted policy. broadcast media coverage recognizes the basic right and need of the citizens of our nation to know the business of their government. >> thursday c-span mark it is 30th an verseio -- anniversary of live gavel to gavel. >> now, i will show to you the body of evidence from this question, do you trust william jefferson clinton? >> we have just witnessed something that we have never seen before happened in all of senate history, the change of

power during a session of congress. >> what the american people still don't understand in this bill is there's three areas in this bill that in the next five years will put the government in charge of everybody's health care. >> plus an interview with senate majority leader mitch mcconnell. >> i'm sure i've made a couple of mistakes in my career. >> donald richie and alan fruman. watch 30 years of the u.s. senate on television beginning thursday on c-span. and to see of more than 30 years of coverage on c-span2, go to c-span.org. >> the u.s. senate is on memorial day recess but today and next week a series of proform session. live right now here on c-span2.

[inaudible conversations] the clerk will read a communication to the senate. the clerk: washington, d.c., may 27, 2016. to the senate, under the provisions of rule 1, paragraph 3, of the standing rules of the senate i hereby appoint the honorable bill cassidy, a senator from the state of louisiana, to perform the duties of the chair, signed orrin g. hatch, president pro tempore. the presiding officer: under the previous order, the senate stands adjourned until 8:30 a.m. stands adjourned until 8:30 a.m.

>> they will continue to work on policy bills which authorizes $602 billion in except gone spending and would require for the first time ever that women register for the draft. when the senate is back on june 6th at 2:00 p.m. eastern watch live coverage here on c-span2. >> i think we, in effect, sort of catch up with the 20th century. we've been the invisible half of the congress the past seven years. we've watched our house colleagues with interest, at least i have with interest and the tv coverage of members of our colleagues in the house. >> today as the u.s. senate comes out of the communication's dark ages, we create another historic moment in the

relationship between congress and technological advancements and communications through radio and television. >> 5 years tag executive branch began appearing on television. today marked the first time when our legislative branch in its entirety will appear on that medium of communication through which most americans get their information about what our government and our country does. >> the televising of senate chamber proceedings, represents a wise and warranted policy. broadcast media coverage recognizes the basic right and need of the citizens of our nation to know the business of their government. >> thursday c-span marks the 30th anniversary. special programming features key moments from the senate floor from the past 30 years. >> and i would show to you the body of evidence from this

question, do you trust william jefferson clinton? >> we have just witnessed something that has never before happened in all of senate history, the change of power during a session of congress. >> what the american people still don't understand in this bill is there's three areas in this bill that in the next fife years will put the government in charge of everybody's health care. >> plus interview with senate majority leader mitch mcconnell. >> i'm sure i've made a number of mistakes but voting against having c-span televising the senate was one of them. >> donald richie and senate alan fruman. watch 30 years of the u.s. senate on television beginning thursday on c-span and more of 30 years of coverage on c-span2, go to c-span.org. >> puerto rico has missed

several debt payments and owes additional $70 billion to creditors. the house resource committee approved legislation that would create a federal oversight board to manage puerto rico's finances. utah congressman rob bishop chairs the committee and lasts just over three hours. [inaudible conversations] >> well, this fun committee is going to come to order. as announced in the markup, we -- i'm sorry. we have a quorum here and we are going to have an exciting and fun day. i haven't had this much fun since we went over red snapper. let's just do red snapper and puerto rico all the time. i've never seen so much -- yeah, so much frivolity come in here.

i'm going to give recognition for those who filed amendments and amendment deadline by yesterday 4:00 p.m., thank you for doing that on time. please go back and tell your staffs, get the amendments in by 4:00. all right, you have received kind of an order, i think, that was sent out to you which we will take the amendments in here. there are only 32 of them that have been filed. it's going to be a piece of cake . there are going to be some of those changes -- i'm going to make some changes on the fly in the order of which we deal with these. some of the amendments are bipartisan and some amendments are easy to accept, some are going to be subject to a point of order. we will try and block them all together in those categories. so we are now ready to start the amendment process on hr5278.

and i have to ask are there amendments to the bill, mr. grace? >> mr. chairman, i have an amendment at the desk. >> all right, this is the first of the bipartisan ones. this is the amendment 046. you all have it. mr. graves, you're recognized explain amendment and without objection the amendment is ordered red. >> thank you, mr. chairman. mr. chairman, this is an amendment that bipartisan amendment that we are doing with mr. polas and what it does is it directs gao to conduct study of the conditions which led to the financial crisis that we are currently experiencing in puerto rico. the idea here, mr. chairman, is that this is a crisis that has sort of evolved over a 10- 10-12-year process and prevent future situations like this from happening, we need to make sure we are extracting as many

lessons learned as possible and so to make recommendations of congress and administration of changes that could occur in the future to avert this type of situation. ii would like to try to prevent from being in the situation again and i yield to mr. poly. >> i want to thank mr. graves for being the amendment. those who don't study history are doom to repeat it and i hope that in addition to working to sort out of the situation in puerto rico, one of the actions in body takes is having quality by gao to help prevent these kind of financial finances in the mainland or territory by finding out what practices, what actions of the territories government, what led to make the

situation as bad as it is today in puerto rico and it is my hope that other states and territories can learn from this, and that will hopefully be a positive legacy of whatever action this body chooses to take and i yield my time back to mr. graves. >> mr. chairman, i reserve. >> let me give you a second to give you a clarification. they have two amendments. i said we are doing 046, this is number one in your list. so still -- i mean, it's a different amendment, this grieves policy amendment number 1. not the 046, if i can yield myself some time i'm satisfied and willing to accept. anybody else who has further discussion on the amendment? if not, any amendments to the amendment? if not we will vote of those in favor of which which is graves

policy number 1. all say aye, opposed say nay. motion carries. all right, now -- i'm sorry. >> it's my fault. yes, i know exactly what i'm doing. we are now going to go back to the -- [laughter] >> this is graves, this is actually graves-meyer. you are recognized for that one. >> so we just passed

graves-polis, correct? >> yes. >> what this does is this provides the discretionary authority. it doesn't require but provides discretionary authority to the oversight board which is established in the act to -- for the oversight board to conduct investigation to understand the selling practices and some of the representations that may or may not have been made with investments in puerto rican securities that may have led to or contributed to misinformation, exacerbated the financial situation that we are facing right now, and again, this is all about lessons learned from this disaster so it provides, gives the discretion to conduct investigation and look at some of the representations associated with this investment, here is the deal, as we all know, we have pensioners and investors in all of our districts across the united states that are invested in these securities and we want

to make sure that we understand what type of representations were made to those investors, under what did they invest in securities and make that information public to ensure that folks have been up front and honest about -- about the dealings with these securities. and i yield to mr. bayer. >> thank you, mr. graves. mr. chairman i proudly support the amendment by my good friend of louisiana, i'm sure questions were marketed by good faith by brokers, dealers and advisers act in accordance with professions, there have been concerns expressed about possible sales of the bonds. i share mr. graves about possible conflicts of interest and failure of disclosure to sell the bonds. it's in the interest of investors but in the best interest of puerto rican government which seeks to regain access to financial markets.

any improper actions be brought to light. i urge support for the graves amendment. >> thank you. is there any further discussion? let me take the time to say personally we have three bipartisan amendments, we just passed the one. i feel comfortable with all three of all the bipartisan amendments. >> mr. chairman, i will support this but i have in front of me the bond issuing documents and it was -- if you read through them, there was full disclosure, specially if you look at the 2014, i have a general obligation bond of 2014 series a. it was a refunding, which is refinancing. if you go through all the documents, it fully discloseses. these were noninvestment grade bonds. they were rated noninvestment

grade by moody's standard and finch and makes clear how risky these bonds are and prudent investors buy these bonds because they want a wide variety of maturity date, risk profiles and they buy lower yielding bonds to -- and balance it off with some higher-yielding bonds and balance the risks. these are professional investors who know what they are doing, and so i haven't heard the kind of allegations that there may have been nonadequate disclosure, but if you read the bond documents themselves, it's very clear how risky these bonds were. and any prudent investor that

buys these kinds of bonds would have known that. thank you, mr. chairman, i yield back. >> wrong one. is there any further discussion on this amendment? any amendments to the amendment? if not all those in favor say aye. opposed? amendment passes. now we are going to the third of the bipartisan amendment, this is mr. polis, 173. you're recognized. >> thank you, mr. chairman. as you're aware in the process of drafting this legislation there's been a lot of discussion and i've certainly try to dill down on the issue of economic growth mechanisms for the island of puerto rico. i have, you know, concerns while addressing the issue of outstanding debt, i think it's very important that we look at progrowth policies for the island, a lot of those will not be -- which will be talking about in amendment, won't necessarily be in order in this

committee, which is why i'm offering from my colleague from michigan in addition to improve the task force which is tasked to come up with federal policy changes that then might be codified through regular order through appropriate committees of jurisdiction to actually create progrowth economic policies for the island, and what we are looking at with this amendment is the composition of this committee, expanding the committee leadership to include the committee on finance, not just leadership of this committee and the energy and natural resources committee in the senate, we love this committee, of course, but it's really important to buy from committees of jurisdiction over pro-growth economic policies. it's really been frustrate to go me that we have not been able to do tax incentives and growth policies that are needed. so the other thing it does instead of allowing 30 days to appoint task force members, we shorten to 16 days. that should be enough. this is an urgent issue.

we need to get to work on this. finally, it requires update on mid-september while congress is still in session. congress is here for a couple more weeks and gives congress a chance to act if congress wants to and the situation in puerto rico is dire. we want to make sure that in addition to whatever action this body takes now, there's at least the opportunity to look at pro-growth economic policies for puerto rico and i hope that the committee supports the bipartisan and simple amendment, i'm happy to yield to mr. benashack. >> finally, my bill that would put puerto rico back on the path to fiscal sanity. while it's incredibly important to work out the immediate crisis that puerto rico finds itself in, we also need to look to the future to help create an economic environment that fosters growth and investment. adding members from house ways and means and senate finance will improve work that the task force of economic growth in

puerto rico will be doing once this bill is signed into law. i'm glad mr. polis and i have been worked across the isle. i want to thank mr. duffy and one step closer in being in law. i urge my colleagues to support the amendment and look forward to continue to go work with all of you to help puerto rico be successful in the long-term. i yield back. >> i reserve the balance of my time. >> you can't reserve. >> or yield back, whichever comes first. okay, i will encourage the adoption of the amendment, this amendment is very simple, includes committee's of jurisdiction so that committees that have jurisdiction over tax policy can look at this, expedite process of recommendations coming back to us and i'm happy to yield back the balance of my time. >> thank you, any other discussion to this amendment? all those in favor say aye, oppose say nay, motion carries.

all right, i would to go through four amendments right now that i will tell you in advance i once again have no problems with and willing to accept it. we have two -- no, i lied again. instead there is an even better amendment, brilliant amendment, it's the technical one under my name which is number one. this one -- i'm sorry, consists, i recognize myself, number one, technical amendments, cross-references, typos, punctuation errors and we try today find two prepositions that ended the sentence, so, any other discussion on the technical amendment? if not, any amendments to the technical amendments? thank you. all those in favor of the amendment say aye? opposes? that one passes. we will do these four in that hour.

mr. glao. 0-46. >> 46. excellent. thank you, mr. chairman. >> you're recognized. >> thank you, mr. chairman. i rise today to offer common sense amendment for a bill before us that affirms the role of puerto rican people in this process. section 409 establishes the task force on economic growth in puerto rico to analyze to stronger economy and help identify opportunities under federal law. i applaud my fellow colleagues here in congress and the administration who have traveled to puerto rico to witness the crisis for themselves, i believe the members who serve on task force ought the bring questions and ideas to the families and businesses on the island. my amendment stipulates that if the fask force holds any hearing, at least one in puerto rico to truly grasp the reality that people are facing. i believe members of the task

force must have a chance to see for themselves the barriers and opportunities on the island for long-term growth and prosperity. mr. chairman, let's adopt my amendment and send a strong message to the puerto rican people that the voices are valued. again, i strongly believe the task force should conduct hearings and at least one should be held on the island. i urge my colleagues to support my amendment and i yield back. >> any amendments to the amendment? if not all those in favor say aye, oppose? motion passes. >> let's do it, mr. chairman. i was right. okay. thank you, mr. chairman. as we look to address humanitarian crisis facing brothers and centers in puerto rico we must consider alarming facts facing the healthcare system that millions depend on. the hospital system has layed 10% of workforce and reducing

services including closing beds, floors and entire wings of hofts just to cut costs. in average of one decision a day is leaving the island. the government is trying to make medicaid payments jeopardizing medicaid programs. mr. chairman, ultimately as we all know it's the patients who will suffer. section 409, establishes and provides meaningful opportunity for congress to examine root causes and offer bipartisan solutions. that's why i'm offering an amendment that ensures the task force consider access to federal healthcare programs as part of admission to identify impediments to economic growth. health care makes 18% of puerto rican economy. must be a essential part of the task force's mission.

lack of low income for prescription drugs have been identified as issue that must be addressed in order to have a sustainable puerto rican healthcare system. by ensuring that the task force reporting these issues i'm hopeful we can act quickly to solve problems that will only hinder, i urge my colleagues to support my amendment and i yield back. >> any other discussion on this amendment? >> thank you, mr. president. i want to thank my friend and colleague from arizona. if we want to ensure that this committee is not back here in a few months to deal with puerto rico once again we must ensure that the root causes are addressed. this means supporting provision that is will grow the economy and stop the mass exodus of people from the island. democrats wanted the legislation to ensure that puerto rico is treated just like any other

state in terms of access to federal health programs. we push for language by removing the medicaid funds for the island and increasing the federal medicaid match. unfortunately, none of these provisions are in the final bill. this amendment would require the congressional task force and economic growth in puerto rico to study the unequitable of healthcare programs as part of the report that looks at all the impediments of economic growth in the island. if this report is going to be fair and adequate, the issue of health parity in puerto rico must be examined. we have nothing to fear and i hope that my colleagues on the other side of the i'll agree. i urge my colleagues to support the amendment and yield the remainder of my time. >> mr. chairman, i oppose this

amendment. the root cause of problems in puerto rico is not that they're not getting enough federal money from us, the root cause is poor decisions that have been made over the years and years and i think that what this amendment does it actually puts a stamp on the bill that we are asking for additional moneys. we have been attacked by -- people have been saying that this bill is a pathway to a bailout and i think if we actually encourage this task force to look at sending more money to puerto rico, it will become that and i think that this amendment should be opposed. >> mr. chair. >> is there any other discussion? >> i move to strike the last word. >> you're recognized for five minutes. >> i rise in support of this amendment, when you look at this bill what we are trying to do is to improve puerto rico's -- the

government of puerto rico's fiscal condition and it's indisputable that the lack of fair equitable access to federal health programs is having a huge impact on the fiscal stability of puerto rico. if you just simply take a look at the medicaid program and you basically provide puerto rico with equal access up to 100% of poverty level, not medicaid expansion, simply treating the american citizens of puerto rico falling below the poverty level equally, the same as their fellow american citizens in the states, puerto rico, the government of puerto rico would be receiving in excess of $2 billion extra, additional each year. right now the government of puerto rico is struggling to deal with the medically indigent and if you're going to be

creating a task force to look at ways in which puerto rico can do bitter, the government of puerto rico can do better, the economy of puerto rico can get back to a growth path, definitely, you should be looking at the way that puerto rico is treated under the federal health programs. this is not preordaining a result, it's simply adding this subject matter to the scope of work of this task force. the task force will make its recommendations, but the members of congress will be the ones with the last say excluding federal health programs from this review, with the work of the task force, doesn't make sense if the objective of this bill is the one that i just portrayed. getting puerto rico back in shape fiscally in the first place and then economically as a result. so i urge my colleagues to

support the amendment offered by mr. gallego. i yield back. >> let me yield to myself for just one second here. this is the easy stuff. this is a study. actually in the base bill of the study it allows them to go into other areas, specifies an area, that's why i'm willing to accept this because once again doesn't mandate anything, it's a study. if you want to still keep talking on this, we can keep talking on it. anyone else? any amendments to this? all those in favor say aye. oppose say nay. let's do a roll call. [roll call]

[roll call] [roll call]

[roll call] [roll call] >> clerk, the report. ..

all right. turn to mister heights. number 22. you are recognized for five minutes >> thank you mister chairman. i'm all for an amendment this morning that i believe will address an issue within this whole debate about puerto rico that has long been overlooked. and that is the influence of private market competition. unfortunately for far too long there has been way too much reliance on the public sector within puerto rico. in fact, in the energy and mineral resources subcommittee hearing this past january, that was held on the prep, we saw an incredible example of just why the puerto rican government has failed for 3 and a half million american citizens on the island. mister chairman, instead, one

of the key objectives that i believe should be part of this legislation is to ensure that we promote and encourage free-market competition in order to improve the overall economy of puerto rico across all industries and so my amendment will achieve just that. i believe that it is critically important that we give the oversight board the ability to promote the very private sector competition that has been so long lacking on the island and so with this amendment i believe that the oversight board can provide the needed support and for the economic growth that is needed so i simply want to ensure that in the future the puerto rican government can serve as a facilitator of the private sector and not an inhibitor of it so mister chairman, i would encourage all my

colleagues to support this amendment and i yield back. >> thank you, is there any discussion to this amended? none, any amendments to the amendment question mark all in favor say aye . so adopted. it will now turn to the macarthur amendments 050, that has to be passed out. there was a technical change, it's been revised so there was a technical change that had to be made. so i will take a second and if the staff will pass those out. all right, they will come out to you quickly, mister macarthur while others are being passed out let me recognize five minutes for the amendment. >> thank you mister chairman. this bill i think in its

current form does a superb job i think of creating structures that resolve the debt and fiscal crisis in puerto rico and it sets the stage in the form of this growth commission for addressing the future growth of the island. i think we could do a little bit more on that and that's what this sense of congress is for. if you look at a chart which i have in front of me of puerto rico's growth from about 1969 until present, you will see the island actually enjoyed pretty healthy growth until about 2000. there was some changes in tax policy that year and in the subsequent five or six years you saw puerto rico's growth go down and down and down and then by 2006, puerto rico's growth has been underwater every year. so what this amendment does is try to address the need for growth, the progrowth

policies. i want to read a quote from forbes magazine, it was an article last night and i'm going to read it because they quoted me. and what they quoted me saying was that it is vital that we help resolve puerto rico's debt crisis but the island will not injure or enduring prosperity until we also include growth initiatives. we have a unique opportunity to establish enterprise zones and apply other progrowth tax policies to puerto rico which will allow this island paradise to become an economic miracle. what this amendment does is simply offers a sense of congress that the growth commission must, and congress must look at progrowth policies including the ones i just referenced. i want to add that it's supported by the puerto rico manufacturing association, i was visited by their president last week, represent 1200 puerto rican companies that account for

about half of puerto rico's economy. coca-cola came out this morning and endorse it, forbes magazine i just read, i introduced it with representative go sorry, it's been supported by americans for tax reform, the national taxpayers union and citizens against government waste so it has broad support and i will leave you just with this. when the president of the puerto rico manufacturing association visited me last week , he applauded all of the things we are doing to resolve the debt crisis in puerto rico. he said this kind of amendment will do more to give hope to the puerto rican people than anything else because it gives them a sense we are paying attention to their future and that this isn't just about resolving debt issues so i urge the passage of the amendment. >> thank you, mister macarthur, i'm glad that you got coca-cola's endorsement but if you wanted gohmert and

my support you have to have it endorsed by dr pepper as well i'm working on dr pepper as well get things things up first. is there any discussion on this amendment, the rabbis on? >> on behalf of the people of puerto rico i commend mister macarthur for presenting this amendment and i support it. i yield back thank you, any other discussion question mark any amendment to the amendment? all in favor say aye. although suppose, the amendment passes as adopted. we are going to go through for amendments for which i will ask , have a point of order against all four of these so let's do them all at once. i will give the people the ability to speak on if they wish to, we'll start with ms. torres, mister 23. i reserve obviously the point of order against the amendment, your recognize for five minutes . >> thank you mister chairman. the legislation as it is currently written allows the minimum wage for workers 25

and under to be lowered to an abysmal $4.25 for as long as the oversight board is in place. my amendment will strip this provision from the bill. mister chairman, when i first entered the workforce in the early 1980s, i was paid minimum wage at 3:35. we are asking the young men and women of puerto rico to make just $.90 above that. in fact, the last time the minimum wage was this low in the united states was 25 years ago. but in today's dollars, workers have had a minimum wage this low sense 1940. the young men and women of puerto rico are american citizens and they don't deserve to be treated like second-class citizens. the workers being affected are not high school students

with a summer job. they are young people starting off their careers, many of them struggling to pay student loan payments to become self sufficient. i am also concerned that there is nothing in this bill that would prevent an employer from laying off older workers the first chance they get just so they could bring cheaper labor. the people of puerto rico are already dealing with an increasing challenging economic environment, lowering the wage would only add an insult to this injury and sends the wrong statement about whether we value puerto ricans as equal american citizens. during our april 13 hearing on this issue, one of our witnesses, antonio wyatt from the treasury department testified that one of puerto rico's biggest problems is its declining population.

this provision only magnifies this problem. the island is already experiencing a mass exodus of young people, lowering wages will only compel more young people to leave, having a detrimental impact on puerto rico's current and future workforce and its tax base. if you are a young person in puerto rico, college educated and an english speaker, what would compel you to stay on the island and build a life there? the minimum wage provision in this bill is bad or these young workers and it's bad for the people of puerto rico. this provision does not fix puerto rico's problem and in the long run, it may worsen them. there is no question that puerto rico will need to make sacrifices but it can't do so on the backs of 25-year-olds. i urge my colleagues to support my amendment so that puerto rico's recovery

doesn't come at the expense of young, hard-working americans. >> thank you. i'm going to have to insist now on my port of order, this amendment violates rule 10, i'm sorry is there discussion to the amendment? do you really have to? all right. >> take your mike. >> a major point of contention for our side of the island has been this point that the gentle lady brought up and some would say that you know,low wages is a progrowth strategy . well, all it will do to the growth problem, it will continue to grow the rate of departure of peoplefrom the island . it will grow discontent.

it will grow family situationsand domestication. it will grow premature deaths, will grow illness, will grow lots of certain corporations but it will not , it will not grow the economy of puerto rico. i want to thank my friend from california, it's an important one regardless of what occurs on this it is an issue that we will have to deal with again. thank you. i yield back. >> is there anyone else before i do the point of order because the point of order isn't going to change. mister cartwright. >> thank you mister chairman. mister chairman, i spoke on this issue as well at the april 13 hearing. look, we are all good capitalists here, we understand how the market works and we understand that if you pay people much less than one place work than in other places of the united states they're going to move to the other places in the united states. i commend representative torres for this amendment and i associate myself with the remarks of the ranking member

and i yield back. >> any other discussion, mister dunn? >> thank you mr. chairman.. i realize this is going to be ruled out of order but for the sake of discussion, the hard-working 25-year-olds in puerto rico are no less american in the hard-working californians in california that are goingto make $15 an hour , it's just a question to the author of the amendment, should puerto ricans receive $15 or more and if we are going to have that discussion we should take a look at how that's going to affect or to rico's economy the same way we look at california's economy. >> is the question to ms. torres? your yield? >> if that is your amendment sir i would absolutely second your amendment request given the fact that these 25-year-olds parents are being asked to relinquish their pension, therefore $15 an hour i believe is a good little low-wage for the citizens of puerto rico.

... >> did you yield back, i'm sorry? there is no amendment . [inaudible question] yield back? thank you. i'm i'm sure there's going to be further discussion of this, just not in this venue because it violates rule 10, it's out of the scope of the jurisdiction of this committee. i will lit out of order. the amendment fails because of that. let's go to the next one then which is mister polis, 168. i reserve a point of order against this amendment, nothing personal but you got

three coming up and it's going to be the same dialogue. you're recognized for your amendment eventhough i still have a point of order against it. >> thank you mr. chairman. and this is the one with regard to the fair labor standards act ? >> i have tax treatment. >> tax treatment, excellence. this amendment is one of the many ideas that would actually promote economic growth on the island and i'm sure a number of members have talked about including mister macarthur, the need for progrowth economic policies. one tool for development is in 19 696 congress decided to phase out were called revenue code over a ten-year period which is when the recession began. my amendment is a tax policy that seeks to bring back some of the jobs and would actually provide economic growth and opportunity for development on the island, it provides an incentive for companies to invest in puerto rico, repatriate income back to the mainland by granting 85 percent exemption against

the second layer of us tax. exemption structure in la mesa lockout affect that many companies believe that their income can be tracked in puerto rico, they can't reinvest it on the mainland and instead incentivizes us companies to go ahead and manufacture in puerto rico knowing that their income can stay anywhere in the united states. i want to point out this amendment is consistent with bipartisan recommendations like the schumer international white paper, paul simpson report from the national committee commission on fiscal responsibility, matches the structure that many other developed countries haveimplemented . in order to reduce any impact to the u.s.treasury , i ensure the proposal does allow companies to game the tax system, proposal is only about active income and it pays limits on the use of foreign tax credit so effectively that would prevent us companies from using credits against taxes paid in puerto rico, reduce taxes on income for other countries. i think this kind of bipartisan economic growth tax proposal is what the

island needs to help get their economy going again as we indicated of course through the sense of congress which i strongly agree with and i hope we can put some meat behind it through this amendment and i yield back. >> thank you, any other discussion to this and i'm going to insist on a point of order, this once again violates rule 10. dealing with issues that are not in the jurisdiction of this committee , ways and means. the amended falls. i'm not picking on you but you have 169. i reserve a point of order what you're recognized for five minutes. >> is this the hot zone amendment. >> yes, but soft.>> german another great idea and i think again, i think one thing that frustrated all this is certainly frustrating me toward our hearings and also during our markup is what the limited jurisdiction of this committee. i think ideally we could have seen something through both ways and means and financial services but i do want to

highlight one other type of economic incentive that i hope the commission recommends and i'm sure they will look at. and this is essentially the concept of home zones which we can go beyond the study, adjust the definition of hope zone for the island of puerto rico to qualify for a historically underutilized business zone that would effectively get small businesses in puerto rico easier access to contracting opportunities. unfortunately only 24 businesses on the island really enjoy the benefits of the program given the very common gateway the current hope zone format applies to puerto rico. it's very limited. many severely distressed areas on the island are excluded from the benefits of the program because of the way they are calculated and our whole point here is in the entire island should be subject to these kinds of incentives. my amendment would allow many more businesses across the island to get the benefit of home zones with the proper

adjustments such as my amendment for a hub zone, i believe hr 5278 can be a more effective vehicle to hel puerto rico lift itself up by his bootstraps, complement and tax policy, regulatory forbearance. this is the kind of policy that could help prevent future need for a bailout for costly solution. i hope the chair and the committee will support my amendment and i get yield back the balance of my time. >> is there any other discussion to this amendment? yes mister ladner. >> i understand there's going to be a point of water race but i'd like to understand and join mister polis and hope we can find a way to do this and i think instead of talking about spending more money to puerto rico, maybe there's more ways that we can actually anchor its economic development on the island so thank you very much. >> further discussion? i'm going to insist on the point of order, this is not a bad idea but for here it is because it violates rule 10,

it's out of the scope of the jurisdiction of this committee. the amendment fails. mister polis, nothing personal but striking the overtime rule. i reserve a point of order. >> thank you and i want to make sure this is a fair labor standards act amendment. >> the overtime rule. >> the overtime rule so here's my final amendment and that again, i think what i tried to put up in the other two amendments are rule about what a proactive growth agenda must look like for puerto rico, there's plenty of other ideas and it shouldn't be limited to those but those are two better low hanging fruit. on the other hand, many democrats have some problems with the issue that mrs. torres highlighted, the reduction of minimum wage and also this which is exempting puerto rico from an overtime rule . and as you know, the rule is long overdue for fair labor standards act, that's the news threshold for salary overtime at $42,000 a year, a worker that makes less than

threshold is eligible for paid overtime about 40 hours a week. wedebated this rule extensively with regard to the continental state and hawaii . i know members have varying opinions on it. i believe that it does not lead to any additional economic growth in puerto rico. if somehow workers are not compensated for working 50 or 60 hours a week, for instance as we all know manager at a fast food restaurants may earn $85,000 or $30,000 but theymight very well work 70 hours a week . that's fine but they deserve their overtime pay and that doesn't change just because of fiscal mismanagement on the government of puerto rico. the overtime provision coupled with different language that mrs. torres talk about that undermines federal minimum wage requirements, i believe he values thousands of hard-working puerto ricans, drives productive people from the island, the exact opposite of what we want to do.

remember they are american citizens, they can move to florida, texas, california. at the exact same fast food mystery restaurant managing in puerto rico, they will not get the overtime but if they simply moved to california or florida, they would get the overtime so it creates this incentive to leave. which i don't think is what we want to do, i don't think that's in the long-term interest of puerto rico so i would encourage my colleagues to consider this amendment, whatever they believe about the virtues of the executive action with the fair labor standards, it's important that puerto rico have those same policies as the rest of the country. obviously the next president can take a stab at whether they want to change it again or not but to create this delta between puerto rico and america with regard to items like overtime can create some perverse incentives that lead the most productive puerto ricans to leave the island which i believe is the opposite of what we want for theeconomic growth of the

island an ideal back the balance of my time . >> further discussion on this amendment? i'll insist on the point of order one more time which again, good conversation but it's out of the jurisdiction of this committee. and amendment falls. let's go on to the next section, the amendments some of which present some problems here. we may take more time starting with the first one which is mister fleming, number 76 area mister fleming, you're recognized for five minutes on your amendment. >> i would like to submit for the record an article from politico on may 9, 2016. the article states and i'm quoting the article, lawmakers say they absolutely, positively will not bailout puerto rico but here's the thing. federal government already is bailing out to rico. it goes on to say this. the obama administration effectively as been providing the beleaguered island with

billions of dollars in aid through a little noticed and convoluted tax arrangements. with the help of a washington law firm, puerto rico in 2010 created a special corporate levee aimed at getting money out of the us treasury and the us is has refused to rule on whether it's legitimate. those are not my words, that's from politico. my amendment simply requires a final ruling from the ras before the rest of the bill's provisions and go into effect . first, a bit of history. the government of puerto rico enacted a new tax through act 154 that took effect in january 2011. this was an excise tax, excuse me. not an income tax, an excise tax on american companies with operations on puerto rico. the tax was structured to qualify for the foreign tax credit so that companies would paythe same amount . here's how it works.

us tax law allows foreign tax credits to be clean to prevent american companies from being double tack on the same income. because we tax american companies no matter where they operate, most companies operating abroad would be subject to both us taxes as well as the tax of the foreign country. us tax law allows american companies to claim a credit of the foreign taxes they pay so they won't overpay. this can create a perverse incentive for foreign countries and we see is here to raise their taxes only on us companies so the tax law has a number of limitations that prevent foreign country from creating a quote, soak up tax which is a tax that would not be imposed if not for foreign tax credits. with the assistance of aj street law firm , puerto rico was able to concoct an excise tax that started all these

restrictions but otherwise would not exist but for the us tax credits. the result is a test group of us dollars to the puerto rican government where american companies pay this novel excise tax to puerto rico and the companies are in turn made whole by the us tax dollars so again, in summary of that, the companies pay the tax, the excise tax. they get fully reimbursed by the us government but the taxes are being paid to puerto rico. puerto rico gets to keep those taxes. in march 2011, the irs released a preliminary ruling say that saying they were studying the tax scheme and would not challenge claims that companies could claim the tax. recently a treasury spokesman said quote, as treasury and irs have previously stated, we are evaluating the excise tax, the provisions of which are novel. it remains under review and we are not yet in a position

to provide guidance on the credibility of act 154. all my amendment does is say that we need a tax ruling from the irs before we go forward. i'd be happy to yield back is there any other discussion on this amendment? mister grimaldi. >> people of puerto rico are suffering in businesses, schools and hospitals are closing and young people in professions are leaving the island by the hundreds every day. they need our help to reverse this trend. the bill before us is not perfect. it is a carefully crafted compromise which seeks to improve the quality of life for families on the island. this amendment should be defeated because it will significantly lengthen the time it takes for the bill to take effect by requiring the secretary of treasury to issue guidance regarding the eligibility of companies to take a foreign tax credit in connection to taxes there

imposed on the island. the people of puerto rico waited long enough for some action by congress, this amendment is not necessary and all it will do is create harm and lengthen the process of doing some actual relief. i oppose the adoption and urge my colleagues to do so as well and i yield back. >> further discussion? >> first of all, this excise tax mister fleming is referring to in his amendment is in lieu of income taxes. it's not a typical excise tax and treasury has taken the position that the tax, they excise tax may be credited against income reported by american controlled foreign corporations doing business in puerto rico. it is true that treasury hasn't given a formal ruling on it but this bill is all

about puerto rico, the government of or to rico's physical condition and the fact of the matter is that this excise tax is generating goes to $2 billion in revenues for the government of puerto rico so to hold this bill hostage until treasury issues a formal ruling doesn't make any sense . to even question this tax in this hearing is also not reasonable. congress has the last say in terms of the way puerto rico is treated for tax purposes. right now because it is congress's will, american corporations doingbusiness in puerto rico as controlled foreign corporations do not pay taxes , federal taxes unless they repatriate their earnings in puerto rico. they repatriate them to the state. at congress's will and puerto

rico has every right to have its own tax system. this american corporation by the way are paying anywhere between two to four percent in income taxes to the government of puerto rico and those are creditable and the government of puerto rico imposed this excise tax in lieu of additional income taxes from them and the taxes credible so this is something that is critical for the fiscal health of puerto rico and we shouldn'tbe questioning it here . in fact , i myself believe it could beout of order but that's the chairman's ruling, not mine .and we have to be very careful because as we all know, we are talking about a fiscal crisis and how does a fiscal crisis happened? it is a function of revenues and expenses and what i'm telling you that $2 billion are coming through this

excise tax to puerto rico, it makes a huge difference. the total revenues of the central government of puerto rico roughly about to $9 billion. $2 billion are coming from this american corporation doing business in puerto rico and by the way, they are paying little. because of the tax increase had in puerto rico and because of the way congress has decided to treat income generated in puerto rico so i urge the gentleman to either withdraw the amendment and in the alternative i oppose it for the sake of the fiscal health of puerto rico which is what we are all trying to deal with it i yield back. >> thank you. let me also feel myself some time on this particular one. several things are very similar was already gone. originally i thought this could have a point of order against it because it deals with tax credits which could

be in the ways and means but as i read this carefully, we can argue it could be in order of this committee. this was argued on the floor it would be much clearer for that. however, i'm going to be voting against this amendment because of the line that starts in the verbiage that starts in line 5 which was already mentioned that it doesn't take effect until the secretary of the treasury does something. in essence, this would allow the administration to slow lock the implementation of the entire bill, waiting for them to do something. empowers the secretary of the treasury and i'm not willing to go that far so i'm actually going to be votingno on this particular amendment . further discussion, mister whitman. >> thank you, i'd like to yield to the gentleman from louisiana. >> i think the gentleman. my colleague on the other side of the aisle willingly admits out of nine or so billiondollars a year revenue , puerto rico, 2 billion of that is coming from taxpayers on the mainland. so this is clearly a tax

scheme and congress had nothing to do with it. nothing. this came completely out of an agreement between some k street lobbyists and the administration to turn a blind eye to this beginning in 2010. this is very recent so the bill allows the taxpayer bailouthas already begun . to say this is not a bailout and has been a bailout simply is not true. this has nothing to do with the income tax, we know about the foreign income tax credit that's prevalent everywhere. this is novel. this is an excise tax and the way it works is , it's to the territories benefit to gradually increase that packs over time and that sucks more and more dollars out of the u.s. treasury when we have a national debt of $19 trillion. i'll be happy to reserve.

>> i yield back. mister whitman, do you yield back? any other discussion on this amendment? any amendments to the amendment? all those in favor say aye. oppose, say nay. the nay's have. all right. >> i'm sorry, i do request able call. [roll call vote] [roll call

vote] [roll call vote] [roll

call vote] >> has anyone not voted? mister gohmert has not voted. >> mister gohmert vote yes. >> anyone else? the clerk will report. >> mister chairman, on this boat the nay's are 12 and the nay's are 26. >> we got seven amendments, we are going to go through several of them right now. our next one with those 79. >> thank you mr. chairman. we have to be very careful with the precedents we are setting

in this bill. this represents a brand-new approach that's never been tried before and we are in many ways in uncharted waters. one of the most glaring examples is the stay on lawsuit. never mind that this concept was first introduced as legislation from the minority leader nancy pelosi. looking at the policy without consideration of the politics, the stage deprives american citizens of access to the judicial system with respect to defending their private property rights. that should give my republican colleagues quite a chill. unlike those who advocate for socialism, we believe in private property in the american system should have a means to defend their property in court. to my knowledge, the automatic stay in this bill is has never before been attempted let's be clear, this day would be the first ever utterly imposed stay on creditor actions outside the context of an actual bankruptcy case.if you vote for this state, you are

telling the bond market that you as a member of congress are fine with changing the rulesin midstream . that is dangerous. let's also be clear, this state is on bondholders only. in other words, the senior citizen in louisiana who financed his or her retirement with puerto rico bonds is under the stay of the union worker on a puerto rico governmentpension is not . that's why i'm offering an amendment to strike section 405, the stay on lawsuit from bondholders. in my mind, congress is not exercising due diligence when it passes legislation that is likely to be ruled unconstitutional. we should carefully consider the constitutionality of the bill before we pass it and exercise restraint when the bill runs afoul of constitutional principles. frankly, i'm surprised section 405 which provides for an automatic stay upon enactment survived this long. even before the first draft

of pro-mesa was released, there seemed to be a recognition by this committee that this section and serious constitutional questions and needed to be dropped. in fact, it seems that the only reason the provision survived is that democrats insisted that it remain and the administration insisted as well. those are not good reasons to pass legislation that runs counter to the constitution. the solution is to support the planning a minute to strike this language from the bill, i urge and i yield back . >> thank you, is there any other discussion. >> is your chairman, one of the main drivers behind doing this bill at all is to provide an orderly debt restructuring process that can hope go hopefully smoothly and quickly. the opposite is a situation in which all the creditors rushed to the courthouse to fight to determine who will get the most of a very limited pot of money and it's very messy, it's expensive,

it's rarely equitable and it can drag on for years. that's exactly what we would have without a stay in this bill. it's also exactly what we can't have in puerto rico. the department of treasury said it would take 10 years to entangle the lawsuits that the creditors were able to start fighting in court. a stay of litigation in the city of puerto rico gets time for voluntary restructuring agreements to be reached and for the oversight board to get set to facilitate orderly restructuring. without a stay, quite frankly there's little point to this bill. which may be why it was introduced. if this amendment passed it would kill the entire bill. for that reason alone, i strongly oppose it and urging oval. >> is there further discussion on this, mister labrador. >> i moved to strike the last word. >> so recognized. >> i have some troubles with this stay as well as a lot of people do but i want to, i

decided to ask my staff to do some research on the constitutionality of this stay so for purposes of education i wanted to just talk about that without taking up this issue on the amendment. first of all, this alleged taking is not taking. you can argue about the state based on whether it's good policy or not but it's not unconstitutional. it is only a stay on creditor litigation, not a deprivation of substantive right. based on long-standing us supreme court precedent, a moratorium or stay on creditor rights limited in duration and scope which is what this state does would not give rise to a takings claim. there's a series of cases in the 1920s and 30s where the supreme court has recognized that in response to a financial emergency, governments enactment of legislation temporarily stay

in creditor rights does not constitute a taking under the fifth amendment. there's a 1921 supreme court case which is locked versus first and i'm not going to bore you with all the information about the cases. there's a 19/43 for caseload else's home association versus place dell. in both cases, the court found that as long as you had a short stay for a specific purpose that there would be no takings in place. lastly, in 1937 the court rejected a constitutional challenge to an act of 1935 which among other things state foreclosure actions against a property of a family farmer. the court found that the imposition of a three-year stay we are talking about a three-year stay as opposed to a six-month stay on the right to foreclose on their mortgage did not provide the creditor of property without due process under the law. that's a case of right versus

benton branch of mountain trust blanche of roanoke. there's other cases and we did some extensive research on this and we asked some experts to do researchon this . you can have i think a pretty valid claim against the state on policy grounds, whether we want to have that policy in the bill or not but i don't think we should reject the state as a matter of constitutional law because the supreme court has made it pretty clear that we have the authority to do this and i yield back. >> is there further discussion on this man? >> mister chair. the amendment proposed by mister fleming would dismantle a core provision of the bill, section 405 should be viewed in isolation. the reason why this bill provides for this automatic stay is precisely to encourage, incentivize creditor negotiations, negotiations between debt insurers in puerto rico and the creditors.

this is something that is done in every chapter 9 case in america, wherever you have to reorganize a public entity, public instrumentality in the us. you file a petition before the bankruptcy court and there's an automatic stay. so that there's no chaos, there's no litigation or all over the place. disrupting the process. here, this bill actually provides for collective negotiations with creditors. it even provides that a two thirds of the creditors of any pool of bonds in any public entity of puerto rico agree on a potential restructuring you can go to court and then enforce it on allthe creditors.

this bill shouldn't be viewed as an anti-creditor bill . the opposite. this is a good bill for all concerned. bondholders, governments of puerto rico, citizens at large. institutional bondholders, individual bondholders because what the bill tries to do is to restructure a lot of the death that the government of puerto rico owes an instrumentalities in an orderly, legal way. the stay is of limited duration. and it basically allows to have a conducive environment for the negotiations to work. not having the stay is going to be chaotic. it's not going to work. and what we want is to have or to rico back in fiscal order with access to the financial markets the sooner the better. in fact, i think the stay is

too short. i'm concerned about the length but this is the result of a negotiation between leadership from both sides of the aisle, white house and treasury. i heard my colleagues to leave this provision as is for the benefit of all. and i opposed the amendment, i yield back further discussion, mister mcclintock. >> i remind my colleagues that a bankruptcy stay freezes both sides, true creditors cannot enforce claims but also the debtor is forbidden from spending down assets. this is a one-sided freeze that allows, that forbids the creditors from enforcing their claims but leaves puerto rico perfectly free to continue to spend and in fact that's exactly what is currently going on. the budget announced by the governor for 2017 provides the spending for non-debt services is actually going up

. about a quarter billion dollars so they are spending more for everything except servicing their debt so the problem with this bill is this provision perversely encourages the puerto rican government to spend down its resources knowing that bondholders are legally powerless to stop them and i yield the remaining time. >> with the gentleman yield? >> i am yielding my remaining time to mister clark. >> my colleagues across the island interestingly enough referred to this as a chapter 9 bankruptcy. we were told in the beginning that this is anything but a bankruptcy but we know that proxy law , chapter 9 bankruptcy law is lifted right out of the codes and set down right in this and interestingly enough, the word bankrupts as far as i know is seen nowhere in this document but the plain truth is and mister mcclintock has this correctly, this is

picking winners and losers. this is not a stay on all involved. what itdoes is it allows people to move assets , spin assets, spin resources while the people who have the highest priority, bondholders are held at bay and with regard to encouraging negotiations, negotiations were ongoing until this pro-mesa bill came up and it shut everything down so things were actually on the correct pathway to begin with . then as to my good friend mister labrador arguing the constitutionality, obviously this is not the supreme court. we are not going to decide today whether this is constitutional but at best it's a controversy and that decision cannot be made today . >> with the gentleman yield? >> for a question on behalf of deal. >> all i want to clarify is any payment not made by a government entity of puerto rico during the stay is a

payment owed. this is not relieving the government of puerto rico of its instrumentality from any debt. and in fact, the board is encouraged to require at least interest payments from the government issuers in puerto rico. >> we're claiming my time. >> reclaiming my time. notes payable, what does that mean mark right now the territory is not able to even perform on this notes payable today so saying they will continue to oh, look, we know there's going to be a reduction in principle here and we know that there are going to be some group that will be treated more equal than other groups. again, governments picking winners and losers. that is a bad precedent. what's going to happen now range or states and other territories and i yield back. >> back the gentleman.

>> did you yield back? >> you yield back. >> further discussion. >> mister chairman, while this provision causes me some heartburn too, i want again to read from bond documents that were gave full disclosure to purchasers of bonds that were issued in 2014. this is a particular paragraph out of the bond disclosure documents . in the future, new legislation could be enacted by the united states congress or by the legislative assembly that would entitle the commonwealth to seek the protection of a statute providing for restructuring moratorium and similar laws affecting editors rights. this could affect the rights and remedies of the holders of general obligation bonds and notes of the commonwealth. including the bonds and these bonds and the enforceability

of the commonwealth's obligation to make payments on such general obligation bonds and notes. these bonds were sold with full disclosure that that could happen even almost anticipating that this could happen so mister chairman, >> will the gentle lady yield for a question? were there not bondholders before 2014 yes there were. >> did they have the same disclosures >> i do not have all the documents here . >> i think we can agree that perhaps some bonds understanding the possibility that there were plenty of others who did lend money understanding that this would not be a likelihood or even a possibility. >> mister chairman, that is entirelypossible area . >> i yield back. >> is there further discussion? let me yield myself some time here. i appreciate the comments that have been made so far. especially the tutorial by

mister labrador, i appreciate that. look, this is a practical purpose of this particular bill. the state language as a reason for being there will the oversight board can get up to speed and be running the floor of the lawsuit starts. there is another provision in the bill that allows the oversight board to intervene in lawsuits but without the state, the time for that intervention would be expired before they could be up and running. the stay is a very short duration, there are other provisions in this bill that allow both parties to seek relief from this day. if there is no stay, it would simply be a race to the courthouse and the frenzy would add chaos by instead of trying to bring some order which is the very purpose of having oversight board in the first place area or not, whatever the intentions of it, this simply gives him of the litigation funds the ability to do nothing more that go to court very quickly and without the ability of

organizing before that happens. i have to vote no on this particular amendment.and i yield back to me, myself from what i had. is there any other discussion on this question mark if not, we will vote on the amendment. all in favor say aye. opposed, say nay. the nay's head. roll call again? [roll call vote] [roll call vote] >>. [roll call vote] >>. [roll call vote] >>. [roll call vote] >>. [roll call vote] >>.

[roll call vote] >>. [roll call vote] >>. [roll call vote] >>. [roll call vote] >>. [roll call vote] >>. [roll call vote] >>. [roll call vote] >>. [roll call vote] >>. [roll call vote]

>>. [roll call vote] >> anyone else has not voted? mister duncan? >> mister duncan has not been recorded, mister duncan votes no . >> anyone exchange, all sex? clerk will report. >> mister chairman, on this boat the aye's are six and the nay's are 33. >> we will go to mister zinke's amendment mister on if we could. is that with you? this was one that was allegedly late. it doesn't need to be circulated?

no, we got it. but i want to note, it's not really late because you printed it on time we just ask you to redo it. so let me have you introduced, you recognized to introduce the zinke number one. >> i offer my memo to hr 5278 and the way to address the issue facing the natural products industry, nutritional supplements etc. in puerto rico. what occurred on february 9 2016 is puerto rico's department of health issued an order in the form of a tax , specifically and at the supplement industry. without going through the legislature or the public notice and so obviously, it hurts that industry, the industry is growing and with that it requires a number of burdensome registrations that mirror what's already required by the fda.

and it also, it's duplicative. it goes on, what the amendment does is it just will allow the congressional task force on economic growth in puerto rico to submit recommendations , it's not mining but recommendations to congress on how best to make the reforms. it should not be controversial. i think it's a good step. from talking to a number of manufacturers, they would like to grow and in puerto rico they think this is an opportunity to manufacture. they think it's an opportunity, the industry itself is growing and it was somewhat arbitrary in how it was placed so again, it doesn't require anything other than a recommendation and i yield back. >> any further discussion of this amendment? i like to simply say i speak in favor of this particular amendment.all right.

other amendments to the amendment? all those in favor say aye. opposed, say nay. the amendment passes. let's go back to mister fleming, number 79. oh i'm sorry, we just did 79. 91. quest we could do 79 again. >> it would be a spoke for you but all right. 79. i mean, 91. look, whatever i say, you are doing 91, okay? listen to what i think, not what i am saying. you are recognized for 91. >> mister chairman, i have two amendments that complement each other. and i will bring members of teaching that we passed this out. it says section 201 has redlining and also some green lines and the shorter bill refers to the green, the green lining, the changes in green and then i will have a

second amendment that is in red so just to sort of help you in a visual way. anyway, i have to amendments that complement each other. the first is short and immense pro-mesa to require the oversight board to give priority to bonds that have been issued with full faith and credit of the puerto rican governments through their constitution. places ahead of bondholders. it is widely important that doesn't happen here because we

are dealing with full faith and credit constitutional debt. a message to owners of that debt that your contract is not valid is a message to bond markets of constitutional bonds are not sacrosanct and can be renegotiated at the governments convenience. that will increase borrowing costs are going including my own state of louisiana at a time when we can least afford it. so again we've got to watch the bond market. if we change the rules, future bond, future debt and interest that goes with that will have to be factored in, built in. what that means is those that are doing the right thing, those who are being good citizens and they are paying their debts and have good solid fiscal and economic policies, they will be punished for the acts of others because they won't have to pay higher rates and that will over the long-term increase the risk for many others.

i urge my colleagues to adopt my an amendment. >> is there any other discussion on this commitment? >> mr. chairman? >> mr. pierluisi. >> i have always advocated for strict compliance with our constitution. in fact, when this crisis began, when the government of puerto rico approved a local bankruptcy law this was back in june 2014, the first thing i did was to introduce legislation giving puerto rico access to chapter nine of the bankruptcy code. i was simply asking congress to treat puerto rico as a state for purposes of bankruptcy. that bill was assigned to the judiciary committee. it didn't get traction. there were some reservations vi