On June 12, the Official Committee of Retired Employees of the Commonwealth of Puerto Rico and the Financial Oversight and Management Board announced that they had reached a proposed agreement to limit planned pension cuts, an important step toward completing the Commonwealth’s landmark restructuring. Represented by Jenner & Block, the Official Committee of Retired Employees stated that the deal negotiated with the Oversight Board will lower the maximum pension cut for retired employees from 25 percent to 8.5 percent, which will only apply to retirees who receive retirement benefits of more than $1,200 per month—up from the board’s original proposed threshold of $600 a month. The agreement, called a Plan Support Agreement, fully protects 61 percent of the total retirees—102,000 in total—from pension cuts. It is anticipated that the Plan Support Agreement will become a cornerstone of the Board’s Plan of Adjustment, which is expected to be filed later this month, and ultimately should help provide a path for Puerto Rico’s emergence from the bankruptcy proceedings. Relative to the original Oversight Board proposal for treatment of pensioners, as set forth in its certified Fiscal Plan, the agreement provides significantly improved protections, both in the near term and long term, across the entire population of retirees.
The Jenner & Block team representing the Official Committee of Retired Employees is led by Partner Robert D. Gordon and includes (alphabetically) Partners Ian Heath Gershengorn, Sarah E. Haddy, Marc B. Hankin, Lindsay C. Harrison, Richard Levin, Landon S. Raiford, Melissa M. Root, Catherine L. Steege and Associate Carl N. Wedoff.