US won't offer financial aid to Puerto Rico

The Obama administration will not offer financial assistance to Puerto Rico, a senior Treasury official emphasized Tuesday on the eve of Treasury Secretary Jacob Lew's visit to the struggling territory.

The official reiterated President Barack Obama's position on the debt crisis in Puerto Rico, saying the federal government would not offer a transfer of funds or assume liability for Puerto Rico, which is weighed down by about $70 billion in debt and a decade of recession.

The administration is seeking tools for restructuring the debt of the Caribbean island under an independent authority, the official said, speaking on condition of anonymity.

It has been trying to convince the Republican-controlled Congress to pass bankruptcy legislation allowing Puerto Rico to restructure its debt, as is authorized for US cities and states. The territory began to default on its debt this month.

The Treasury official also noted that Paul Ryan, speaker of the US House of Representatives, had pledged a solution would be found in the coming months.

A new hearing on Puerto Rico's crisis, focused on the need for a financial stability and economic growth authority, is scheduled on January 26 in the House. Lawmakers held six hearings on the island's woes in 2015.

Lew will make a one-day visit to Puerto Rico on Wednesday to discuss the situation with top government officials and company and union leaders.

The official said the Treasury secretary will gather direct information on the impact of the debt crisis on businesses and the population, highlighting that some 3,000 Puerto Ricans leave the embattled island each week for the United States.

Lew, in a letter to House Speaker Ryan last Friday, urged Congress to pass legislation to allow the island of 3.5 million Americans to restructure its debt, warning it was already amid "an economic collapse."

He called on Congress to pass legislation for Obama to sign into law before the end of March.

"Only Congress can enact the legislative measures necessary to fully resolve this problem.... It is time for Congress to act to provide order to a chaotic and worsening situation."