Thus, under Bankruptcy Code Section 109(c), the Commonwealth of Puerto Rico's municipalities don't meet the requirements for filing bankruptcy under Chapter 9.
Puerto Rico has maintained that Congress never barred the territory from adopting its own bankruptcy provisions - something Justice Ruth Bader Ginsburg seemed to agree with. That would help the island restructure about $20 billion in debt.
Puerto Rico Gov. Alejandro García Padilla's administration in 2015 announced it would no longer defend the US commonwealth's same-sex marriage ban. Justices Anthony Kennedy and Clarence Thomas were silent. Washington must act quickly to avoid some very predictable and irreparable damage, Roman said in the letter. Later during respondent's argument he said that he had a "better understanding" of the petitioners' argument now.
At the end of the one-hour session March 22, it appeared that the case had made some headway among the seven justices who presided over it. Justice Samuel Alito recused himself, possibly due to a financial conflict, said a report by the Associated Press. The Recovery Act would not apply to all of Puerto Rico's debt, but would let it put public utilities like power authority, PREPA, into bankruptcy, reports Reuters.
"Why would Congress put Puerto Rico in this never-never land?"
Reinstating the Recovery Act could allow Puerto Rico to scrap that deal and instead put PREPA into bankruptcy, where it could impose deeper cuts and bind holdout creditors to the deal. He called the respondent's approach "selective textualism".
Creditors say the act contradicts federal bankruptcy law, which prohibits states from making their own debt restructuring laws.
The economic crisis has left Puerto Rico facing a mass exodus of residents - 84,000 people left Puerto Rico for the United States mainland in 2014, a 38% increase from 2010.
The only justice who expressed outright hostility to Puerto Rico's position was conservative chief justice John Roberts, who said he was not sure the territory's argument "carries much weight".
Ex-Flint manager says he relied on experts in water crisis
Earley's testimony comes as the House oversight panel holds two hearings this week on the Flint crisis. It has also led to several lawsuits in state and federal courts, and federal and state investigations.
Contemplating congressional intent, the Court weighed whether Congress meant to prevent Puerto Rico from entering bankruptcy like other states.
Elena Kagan, a liberal, said that before the oral argument started she favored Puerto Rico's position, but after hearing from the creditors' attorney, Kagan found the territory's arguments to be equally compelling.
Lambda Legal on Monday petitioned a federal appeals court to intervene in a Puerto Rico same-sex marriage case. Hernandez was moderating a panel of speakers on Puerto Rico's public debt and status at American University Washington College of Law in Washington.
U.S. Treasury Secretary Jack Lew told a House panel last week that time is running short because Puerto Rico faces large bond payments.
According to Rep. Louis Vega Ramos, a member of the House of Representatives of Puerto Rico, the issue with Puerto Rico isn't merely a financial crisis, but a "humanitarian crisis".
Now the Supreme Court is involved.
"While this could be positive, it still doesn't offer a comprehensive solution", LeCompte said. Eric LeCompte, the executive director of the debt fairness group Jubilee USA, explained in a phone interview that the distinction was about the funds trying to pick and choose what powers Puerto Rico has as a state.
On the other side, Matthew McGill argued Chapter 9 applied to everyone.