P.R. Laws tit. 13, § 64
(a) The Secretary of the Treasury is hereby authorized to issue and sell, all at once or from time to time, through resolution to such effect and with the approval of the Governor, savings notes in economic cooperation with Puerto Rico, for a total sum of twenty million dollars ($20,000,000).
(b) Form and date of payment; maturity; denominations; negotiable instruments; price. — The notes authorized to be issued under the provisions of this section shall be payable to or in favor of the designated beneficiary, shall be dated at the time of their sale and shall mature on a date or dates that shall not exceed five (5) years from its date or dates of sale, shall accrue interest at an annual rate of six percent (6%) accrued on a monthly basis, they may be redeemable before maturity at the option of the holder of said bonds, and may contain such other terms and conditions as provided in the resolution that authorizes each particular issue. With the approval of the Governor, the Secretary of the Treasury shall determine in said resolution or resolutions the form of said notes, how they shall be executed, and shall fix the denomination or denominations of the notes and the place or places in which the principal of, and the interest accrued on said notes shall be paid. When any official whose signature or facsimile thereof appears on any note ceases to hold office before the delivery of said bonds, said signature or facsimile shall, nevertheless, be valid and sufficient, it being deemed for all purposes as if such official had remained in office until such delivery. The notes issued pursuant to the provisions of this section shall be deemed to be negotiable instruments under the laws of the Commonwealth of Puerto Rico. The Secretary of the Treasury, with the approval of the Governor, may sell said notes all at once, or from time to time, in public or private sale, as he/she determines to be most convenient to the best interests of the Commonwealth of Puerto Rico and for such price or prices not lower than the price legally established at the time of the sale.
(c) Payment of principal and interest; date; interest rate. — The principal and interests on the savings note authorized by this section shall be payable on the maturity thereof or on the redemption date if they are presented for payment before their maturity. The interests shall be accrued on the basis of compound interests until their maturity or the redemption date if the notes are redeemed prior to their maturity at an interest rate of six percent (6%) accrued on a monthly basis.
(d) Payment of principal and interests; prompt payment; available funds; continuous appropriation; transfer of funds. — The good faith, credit and taxing power of the Commonwealth of Puerto Rico are irrevocably pledged for the prompt payment of the principal and interests accrued on the notes issued under the provisions of this section. The Secretary of the Treasury is hereby authorized and directed to pay the principal and interests accrued on such notes as they mature, from any funds available for such purposes in the Treasury of the Commonwealth of Puerto Rico in the fiscal year in which such payment is required, and the provisions of this section concerning the payment of the principal and interests accrued on such notes. It shall be deemed a continuing appropriation for the Secretary of the Treasury to make such payments even if no specific appropriations are made for such purpose. Said payments shall be made pursuant to the provisions of the laws of the Commonwealth of Puerto Rico which regulate the disbursement of public funds.
Furthermore, the Secretary of the Treasury is hereby authorized to transfer, from time to time, to the fund denominated “Special Fund for the Amortization and Redemption of General Obligations Evidenced by Bonds and Notes”, an amount which shall be sufficient for the payment of the principal and interest accrued on the savings notes whose issue is authorized by this section, plus a reasonable amount as a reserve for the redemption of savings notes that are presented for payment prior to their maturity.
(e) Creation of the Economic Cooperation and Options Fund for Public Employees; provision on the product from the sale of notes; application of surplus money. —
(1) A special fund is hereby created, separate from any other fund of the Commonwealth of Puerto Rico, which shall be known as the “Special Economic Cooperation and Options Fund for Public Employees”, in which the funds to be collected from the issue and sale of the notes issued pursuant to this section shall be deposited.
(2) This fund shall be administered by the Fiscal Restructuring and Stabilization Board and shall be used for the payment of the benefits established in §§ 8791—8810 of Title 3 for public employees who have been laid off pursuant to the same, in accordance with the statutory provisions that regulate the disbursement of public funds.
(3) Any surplus in the fund after making said payments shall be deposited in the “Special Fund for the Amortization and Redemption of general Obligations Evidenced by Bonds and Notes”, and shall be used for the removal of any debt of the Commonwealth of Puerto Rico, or to carry out any public capital improvement approved by the Legislature that is still pending.
(f) Payment of expenses incurred. — The amount that is necessary to be applied to the payment of expenses incurred for the issue and sale of savings notes is hereby appropriated from the product of the sale of the notes issued pursuant to the provisions of this section.
(g) Tax exemptions. — The notes issued under the provisions of this section, as well as the interests accrued by them shall be exempted from the payment of any tax levied by the Commonwealth of Puerto Rico and its municipalities.
(h) Deductions from salaries for the purchase of notes. — The employees may authorize, through a signed document, their employers or officer to regularly deduct from their wages or salaries the amounts that they have authorized to be used for the purchase of savings notes for economic cooperation with Puerto Rico. Said deducted amounts shall be applied by the employers or officers as established by the Secretary of the Treasury through regulations.
(i) Certificates. — The Secretary of the Treasury of the Commonwealth of Puerto Rico is hereby authorized to issue provisional certificates representing the savings note, which shall be delivered to the buyers of said notes. Said certificates shall be issued pending the final version of the notes for the amount corresponding to the denominations of each one of the notes to be purchased or for the total sums, as requested by the buyer thereof. The notes may be issued in electronic format or on paper, as requested by the buyer, and shall have the effective date of the original issue of each certificate, as well as the interest rate and other conditions authorized as established in said certificates.
(j) Banks or other financial institutions, prohibition to acquire notes. — The savings notes issued pursuant to the provisions of this subsection may not be acquired by any bank or financial institution of a depositary nature.
(k) Regulations; penalties. — The Secretary of the Treasury is hereby empowered to adopt, in coordination with the Government Development Bank for Puerto Rico, the regulations that are necessary and convenient for the best administration of this section, including those applicable to the collections from the deductions authorized thereby. Any violation to the provisions of section or of the regulations promulgated shall constitute a misdemeanor that shall entail a penalty of not less than $50 nor greater than $500, or imprisonment for a term which shall not exceed six (6) months, or both penalties, at the discretion of the court.
(l) Application to other laws. — All provisions of law or laws that authorize the issue of bonds of the Commonwealth of Puerto Rico shall be applicable to the savings notes to the extent that they are not in conflict with the provisions of this subsection.
(m) Interpretation with other laws. — This section shall not be considered to repeal or amend any other previous law of the Legislature of Puerto Rico authorizing the issue of obligations of the Commonwealth of Puerto Rico.
History —Mar. 9, 2009, No. 7, §§ 53.1—53.13.