Garcia Padilla is reviewing a fiscal 2017 budget that the legislature passed last month. It would direct about $800 million to Puerto Rico’s public employee pension systems -- about $150 million more than was budgeted last year -- and $250 million from the general fund to prop up the insolvent Government Development Bank, the hedge funds said in the complaint.
Entities managed by Aurelius Capital Management, Autonomy Capital, Covalent Partners, FCO Advisors, Monarch Alternative Capital and Stone Lion Capital Partners filed the suit Wednesday in the U.S. District Court in San Juan.
Some of those funds, Aurelius, Autonomy, FCO Advisors and Monarch, filed suit against Puerto Rico last month in Manhattan federal court over the island’s local debt moratorium law, which allows the governor to skip debt-service payments through January.
The case is Lex Claims v. Padilla, 16-cv-02374, U.S. District Court, District of Puerto Rico (San Juan).