Assured Guaranty Corp. v. Fin. Oversight & Mgmt. Bd. for Puerto Rico (In Re Fin. Oversight & Mgmt. Bd. for Puerto Rico)

United States Court of Appeals
For the First Circuit

Nos. 18-1165, 18-1166

IN RE: THE FINANCIAL OVERSIGHT AND MANAGEMENT BOARD FOR
PUERTO RICO, AS REPRESENTATIVE FOR THE COMMONWEALTH OF
PUERTO RICO; THE FINANCIAL OVERSIGHT AND MANAGEMENT BOARD FOR
PUERTO RICO, AS REPRESENTATIVE FOR THE PUERTO RICO HIGHWAYS &
TRANSPORTATION AUTHORITY,

Debtors.
_____________________

ASSURED GUARANTY CORPORATION; ASSURED GUARANTY MUNICIPAL
CORPORATION; FINANCIAL GUARANTY INSURANCE COMPANY; NATIONAL
PUBLIC FINANCE GUARANTEE CORPORATION,

Plaintiffs, Appellants,

v.

THE FINANCIAL OVERSIGHT AND MANAGEMENT BOARD FOR PUERTO RICO,
AS REPRESENTATIVE FOR THE COMMONWEALTH OF PUERTO RICO;
FINANCIAL OVERSIGHT AND MANAGEMENT BOARD FOR PUERTO RICO;
PUERTO RICO FISCAL AGENCY AND FINANCIAL ADVISORY AURTHORITY;
THE FINANCIAL OVERSIGHT AND MANAGEMENT BOARD FOR PUERTO RICO,
AS REPRESENTATIVE FOR THE PUERTO RICO HIGHWAYS & TRANSPORTATION
AUTHORITY; RICARDO ROSSELLÓ-NEVARES; GERARDO JOSÉ PORTELA-
FRANCO; CARLOS CONTRERAS-APONTE; JOSÉ IVÁN MARRERO-ROSADO;
RAÚL MALDONADO-GAUTIER; NATALIE A. JARESKO,

Defendants, Appellees,

JOSÉ B. CARRIÓN III; ANDREW G. BRIGGS; CARLOS M. GARCÍA;
ARTHUR J. GONZÁLEZ; JOSÉ R. GONZÁLEZ; ANA J. MATOSANTOS;
DAVID A. SKEEL, JR.; CHRISTIAN SOBRINO,

Defendants.
 APPEALS FROM THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF PUERTO RICO

[Hon. Laura Taylor Swain,* U.S. District Judge]

Before

Howard, Chief Judge,
Torruella, and Thompson, Circuit Judges.

Mark C. Ellenberg, with whom Howard R. Hawkins, Jr., Lary
Stromfeld, Ellen V. Holloman, Gillian Groarke Burns, Thomas J.
Curtin, Casey Servais, Cadwalader, Wickersham & Taft LLP,
Heriberto Burgos-Pérez, Ricardo F. Casellas-Sánchez, Diana Pérez-
Seda, and Casellas Alcover & Burgos were on brief, for appellants
Assured Guaranty Corp. and Assured Guaranty Municipal Corp.
Eric Pérez-Ochoa, Alexandra Casellas-Cabrera, Lourdes Arroyo-
Portela, Adsuar Muñiz Goyco Seda & Pérez-Ochoa, P.S.C., Jonathan
Polkes, Marcia Goldstein, Gregory Silbert, Kelly DiBlasi,
Gabriel A. Morgan, and Weil, Gotshal & Manges LLP on brief, for
appellant National Public Finance Guarantee Corporation.
María E. Picó, Rexach & Picó, CSP, Martin A. Sosland, Jason W.
Callen, and Butler Snow LLP on brief, for appellant Financial
Guaranty Insurance Company.
Mark D. Harris, with whom Timothy W. Mungovan, Martin J.
Bienenstock, Stephen J. Ratner, Jeffrey W. Levitan, Michael A.
Firestein, Lary Alan Rappaport, Proskauer Rose LLP, Hermann D.
Bauer, and O'Neill & Borges LLC were on brief, for appellees The
Financial Oversight and Management Board for Puerto Rico, for
itself and as representative for the Commonwealth of Puerto Rico
and the Puerto Rico Highways and Transportation Authority, and
Natalie A. Jaresko.
Luis Marini, Marini Pietrantoni Muñiz, LLC, John J. Rapisardi,
Peter Friedman, Elizabeth L. McKeen, and O'Melveny & Myers LLP on
brief, for appellees the Puerto Rico Fiscal Agency and Financial
Advisory Authority and Gerardo Portela-Franco.
Luc A. Despins, with whom William K. Whitner, James B.
Worthington, James T. Grogan III, Paul Hastings LLP, Juan J.
Casillas-Ayala, Diana M. Battle-Barasorda, Alberto J.E. Añeses-
Negrón, Ericka C. Montull-Novoa, and Casillas, Santiago & Torres
LLC were on brief, for Official Committee of Unsecured Creditors.
Laura E. Appleby, with whom Steven Wilamowsky, Aaron Krieger,

* Of the Southern District of New York, sitting by designation.

-2-
Chapman and Cutler LLP and Kevin Carroll, as amicus curiae for The
Securities Industry and Financial Markets Association.
Vincent J. Marriott III, with whom Chantelle D. McClamb, and
Ballard Spahr LLP, as amicus curiae for The National Federation of
Municipal Analysts.

March 26, 2019

-3-
 TORRUELLA, Circuit Judge. Appellants, financial

guarantee insurers that had insured bonds from the Puerto Rico

Highway and Transportation Authority ("PRHTA") (hereinafter the

"Insurers"), appeal from the dismissal of their Amended Complaint

in an adversary proceeding arising within the debt adjustment

proceeding that the Financial Oversight and Management Board (the

"Board") commenced on behalf of the PRHTA under Title III of the

Puerto Rico Oversight, Management, and Economic Stability Act

("PROMESA"), see 48 U.S.C. §§ 2161-2177. Because the district

court did not err when it dismissed the Insurers' Amended Complaint

pursuant to Fed. R. Civ. P. 12(b)(6) on the grounds that neither

Section 922(d) nor Section 928(a) of the United States Bankruptcy

Code entitle the Insurers to the relief they sought, we affirm.

I. Background

1. PROMESA

This is one of a sequence of appeals related to PROMESA,

a statute enacted by Congress "in June 2016 to address an ongoing

financial crisis in the Commonwealth of Puerto Rico." In re Fin.

Oversight & Mgmt. Bd. for Puerto Rico, 872 F.3d 57, 59 (1st Cir.

2017) (citation omitted). To "help Puerto Rico achieve fiscal

responsibility and access to the capital markets," the statute

created the Board, which has "the ability to commence quasi-

bankruptcy proceedings to restructure the Commonwealth's debt

-4-
under a part of the statute often referred to as 'Title III.'"

Id. PROMESA is largely modeled on municipal debt reorganization

principles set forth in Chapter 9 of the Bankruptcy Code.

2. The PRHTA Bonds

In 1965, the Commonwealth of Puerto Rico ("the

Commonwealth") created the PRHTA, a public corporation, to

"oversee and manage the development of roads and various means of

transportation" in the Commonwealth by passing Act No. 74-1965,

known as the "Enabling Act." Assured Guar. Corp. v. Commonwealth

of Puerto Rico (In re Fin. Oversight & Mgmt. Bd. of P.R.), 582

B.R. 579, 585-86 (D.P.R. 2018); see generally P.R. Laws Ann. tit.

9, § 2002. Pursuant to its Enabling Act, the PRHTA can secure

capital by issuing municipal bonds. The PRHTA has issued several

series of bonds (the "PRHTA Bonds") under Resolution No. 68-18 and

Resolution No. 98-06 (collectively the "Resolutions"). The

Insurers allege that pursuant to the Enabling Act and the

Resolutions, the PRTHA Bonds are secured by a gross lien on (i) the

revenues derived from the tolls on four highways within the

Commonwealth (the "Pledged Toll Revenues"); (ii) gasoline, diesel,

crude oil, and other special excise taxes levied by the

Commonwealth (the "PRHTA Pledged Tax Revenues"); and (iii) special

excise taxes consisting of motor vehicle license fees collected by

the Commonwealth (together with the PRHTA Pledged Tax Revenues,

-5-
the "PRHTA Pledged Special Excise Taxes"). According to the

Insurers, the Puerto Rico Secretary of Treasury is required by

statute to transfer the PRHTA Pledged Special Excise Taxes to PRHTA

each month for the benefit of PRHTA bondholders. They further

allege that the Pledged Toll Revenues and the PRHTA Pledged Special

Excise Taxes (collectively, the "PRHTA Pledged Special Revenues")

are the Insurers' property, which the PRHTA must transfer to the

fiscal agent for the PRHTA Bonds on a monthly basis to replenish

tripartite1 funds (the "Reserve Accounts") held in trust by The

Bank of New York Mellon ("BNYM").

3. The Debt Adjustment Proceeding

In March 2017, after the enactment of PROMESA and

appointment of the Board,2 the Board certified a financial plan by

which the PRHTA Pledged Special Revenues formerly being deposited

in the Reserve Accounts would instead be diverted and subsumed

into the general revenues of Puerto Rico. On May 3 and 21, 2017,

the Board commenced debt adjustment proceedings on behalf of the

Commonwealth and the PRHTA, respectively, pursuant to Title III of

PROMESA.

1 Each fund established by the Resolutions consists of a bond
service fund, a bond redemption fund, and a reserve fund.

2 For our decision regarding the constitutionality of the Board
members' appointment, see Aurelius Inv., LLC v. Commonwealth of
P.R., 915 F.3d. 838 (1st Cir. 2019).

-6-
 BNYM continued to make payments to the PRHTA bondholders

through June 20, 2017, when the Puerto Rico Fiscal Agency and

Financial Advisory Authority ("AAFAF" for its Spanish acronym), on

behalf of PRHTA, instructed BNYM to cease making scheduled payments

from the Reserve Accounts. The reasoning behind the instruction

was that making such payments would constitute an act "to exercise

control" over PRHTA's property in violation of the automatic stay

that arose under 11 U.S.C. § 362(a), as incorporated by Section

301 of PROMESA, following the filing of the Title III petition on

the PRHTA's behalf. Thereafter, on July 3, 2017, the PRHTA

defaulted on a scheduled bond payment of $219 million. BNYM is

abstaining from distributing funds from the Reserve Accounts until

this matter is resolved.3

In June 2017, the Insurers initiated adversary

proceedings against the Commonwealth, the PRHTA, the Board, the

AAFAF, the Governor of the Commonwealth, and other individual

defendants in their official capacity (collectively the

"Debtors"). 4 In their Amended Complaint, which included four

claims for relief, the Insurers essentially alleged that failure

to continue to remit the PRHTA Pledged Special Revenues into the

3 As of July 3, 2017, the Reserve Accounts contained cash and
investments valued at approximately $76 million.

4 The Insurers are subrogated to the rights of the PRHTA
bondholders whose claims they have paid.

-7-
Reserve Accounts and pay them as payments come due violates Chapter

9 of the Bankruptcy Code. Specifically, the Insurers' first claim

sought declarations that the PRHTA Bonds were secured by special

revenues, that the application of such revenues to payments on the

bonds is exempted from the automatic stay imposed by Title III of

PROMESA, and that failure to continue to remit the PRHTA Pledged

Special Revenues during the pendency of the Title III proceedings

is in violation of Sections 922(d) and 928 of Chapter 9 of the

Bankruptcy Code (which Section 301 of PROMESA makes applicable to

Title III proceedings). The second claim sought declarations that

the funds held in the Reserve Accounts are: (a) property of the

PRHTA bondholders, (b) held in trust for the benefit of the

bondholders, and (c) subject to a lien in their favor. They

further sought a declaration that the PRHTA lacked enough property

interest to prevent the disbursement of the funds currently held

in the Reserve Accounts unless or until the PRHTA Bonds are fully

retired or defeased. The third claim sought injunctive relief

against further alleged violations of Sections 922(d) and 928 of

the Bankruptcy Code. Finally, the fourth claim sought injunctive

relief requiring the PRHTA to resume remittance of the special

revenues securing the PRHTA Bonds in accordance with

Sections 922(d) and 928 of the Bankruptcy Code.

-8-
 The Debtors moved to dismiss the Amended Complaint under

Fed. R. Civ. P. 12(b)(1) and 12(b)(6), for lack of subject matter

jurisdiction and failure to state a claim upon which relief could

be granted. They essentially argued that the Amended Complaint

failed to state a claim for relief because neither Section 922(d)

nor Section 928 of the Bankruptcy Code requires PRHTA to remit

payment of special revenues to bondholders during the pendency of

the Title III proceedings nor do those statutes create a cause of

action for bondholders to compel payment. Further, they claimed

the PRHTA bondholders did not have a property interest in the funds

in the Reserve Accounts.

After holding a hearing, the district court granted the

motion to dismiss. Assured, 582 B.R. at 585. It held that neither

provision of Chapter 9 requires or empowers the court to order

continued remittance of PRHTA Pledged Special Revenues to the

Reserve Accounts or payment of PRHTA Pledged Special Revenues to

the PRHTA bondholders during the pendency of Title III proceedings.

Specifically, the court found that "Section 928 does not mandate

the turnover of special revenues." Id. at 593. Rather, "Section

928(a) merely exempts consensual prepetition liens on special

revenues acquired by the debtor post-petition from Section 552(a)

of the Bankruptcy Code, which could otherwise invalidate such liens

with respect to revenues acquired post-petition." Id. Regarding

-9-
Section 922(d), the court held that although it "excepts the

'application' of special revenues from the automatic stay," it

does not "except actions to enforce special revenue liens,"

id. at 596, or otherwise impose a payment obligation, id. at 594.

Therefore, the court concluded, the Insurers had failed to

adequately state a claim upon which relief can be granted.

Id. at 591-96. The court also held that the Insurers failed to

plausibly plead that the bondholders had a property interest in

the funds of the Reserve Accounts.5 Id. at 597-98.

5 The district court found the second claim for relief to be
premised on the following three different theories of bondholder
interests in the Reserve Accounts: that (1) the PRHTA bondholders
were outright owners of the funds in the Reserve Accounts and thus
neither the automatic stay nor Section 305 of PROMESA barred them
from collecting the funds; (2) the funds in the Reserve Accounts
are held in trust for the benefit of the PRHTA bondholders "under
terms that exclude cognizable property interests of PRHTA in those
funds"; and (3) the funds in the Reserve Accounts are held in trust
by BNYM for the benefit of the PRHTA bondholders. Assured,
582 B.R. at 591. The court concluded that, to the extent the
Insurers' claim was premised on the third theory, the court lacked
subject matter jurisdiction. It reasoned that a determination of
the lien interest, by itself, would not resolve "the question of
whether, when and from what, if any, funds the PRHTA bondholders
are entitled to be paid." Id. Accordingly, the issue was not
ripe, and the court lacked subject matter jurisdiction. The court
then addressed the merits of the remaining two theories.
Regarding the ownership-based theory, the court concluded that the
Resolutions and statutory provisions on which the Insurers relied
do not suggest that PRHTA bondholders were granted an outright
ownership interest in the Reserve Accounts or the funds therein.
Id. at 597-98. As to the trust-based theory, the court noted that
"[w]hile multiple interpretations could plausibly be supported" by
the language of the Resolutions and the allegations of the Amended
Complaint, each interpretation contemplates a contingent
revisionary beneficial interest in the trust corpus, and perhaps

-10-
 The Insurers appeal from the district court's dismissal

of the first, third, and fourth claims of their Amended Complaint.

II. Discussion6

We review de novo the district court's grant of a motion

to dismiss. In so doing, we treat all well-pleaded facts in the

complaint as true and draw all reasonable inferences in favor of

the plaintiff. Ocasio-Hernández v. Fortuño-Burset, 640 F.3d 1, 7

(1st Cir. 2011). A complaint will survive dismissal under Rule

12(b)(6) if it contains "enough facts to state a claim to relief

that is plausible on its face." Bell Atl. Corp. v. Twombly,

550 U.S. 544, 570 (2007).

Whether the Amended Complaint properly pleads a claim

for relief as to the Insurers' first, third, and fourth claims

hinges on the statutory construction of Sections 928(a) and 922(d)

even title, by PRHTA. Id. at 598. The court concluded that,
given the revisionary interest on the part of PRHTA, Section 305
of PROMESA prevented the court from interfering with the Reserve
Accounts. Id. at 598-99. Hence, the court dismissed the second
claim for failure to state a claim upon which relief can be
granted. Id. at 599.

We need not address the district court's dismissal of the
Insurers' second claim for relief because the Insurers have failed
to develop on appeal any argument on the PRHTA bondholders'
property interest in the Reserve Account funds. See United States
v. Zannino, 895 F.2d 1, 17 (1st Cir. 1990).

6 Because the district court correctly decided the issues, and
persuasively explained its reasoning in a detailed opinion, we see
no reason to write at length. See Moses v. Mele, 711 F.3d 213,
216 (1st Cir. 2013).

-11-
of the Bankruptcy Code. We thus turn to those statutes and provide

some statutory context necessary to understand the parties'

arguments.

Section 552(a) of the Bankruptcy Code establishes

generally that "property acquired by the . . . debtor after the

commencement of the case is not subject to any lien resulting from

any security agreement entered into by the debtor before the

commencement of the case." 11 U.S.C. § 552(a). Section 928,

however, exempts consensual prepetition liens on special revenues

from application of Section 552(a) in Chapter 9 cases.

Specifically, Section 928 states:

(a) Notwithstanding section 552(a) of this title and
subject to subsection (b) of this section, special
revenues acquired by the debtor after the commencement
of the case shall remain subject to any lien resulting
from any security agreement entered into by the debtor
before the commencement of the case.
(b) Any such lien on special revenues, other than
municipal betterment assessments, derived from a
project or system shall be subject to the necessary
operating expenses of such project or system, as the
case may be.
11 U.S.C. § 928.

The Insurers argue that Section 928(a) not only

overrides Section 522(a) and thus preserves prepetition liens, but

also requires continued payments of special revenue bonds, such as

the PRHTA Bonds, during the pendency of the Title III proceeding

to avoid debtor misuse of the property subject to the lien.

-12-
 It is elementary that in resolving a dispute over the

meaning of a statute we begin with the language of the statute

itself. Landreth Timber Co. v. Landreth, 471 U.S. 681, 685 (1985).

We first "determine whether the language at issue has a plain and

unambiguous meaning with regard to the particular dispute in the

case." Robinson v. Shell Oil Co., 519 U.S. 337, 340 (1997). "The

plainness or ambiguity of statutory language is determined by

reference to the language itself, the specific context in which

that language is used, and the broader context of the statute as

a whole." Id. at 341 (citing Estate of Cowart v. Nicklos Drilling

Co., 505 U.S. 469, 477 (1992); McCarthy v. Bronson, 500 U.S. 136,

139 (1991)). If "the statute's language is plain, 'the sole

function of the courts is to enforce it according to its terms.'"

United States v. Ron Pair Enters., Inc., 489 U.S. 235, 241 (1989)

(quoting Caminetti v. United States, 242 U.S. 470, 485 (1917)).

If, however, the language is not plain and unambiguous, we then

turn to other tools of statutory construction, such as legislative

history. See Arnold v. United Parcel Serv., Inc., 136 F.3d 854,

858 (1st Cir. 1998).

We find Section 928(a)'s plain language unambiguous.

Section 928(a) simply provides that consensual prepetition liens

on special revenues will remain in place after the filing of the

petition, despite the fact that Section 552(a) generally protects

-13-
property acquired after the petition from being subject to

prepetition liens.7 That is, without Section 928(a), pursuant to

Section 552(a), consensual prepetition liens would be invalidated

with respect to special revenues acquired by the debtor post-

petition. As the district court found, Section 928, however, is

silent about enforcement of liens or "payment of the secured

obligation," and does not order any action on the part of the

debtor. Assured, 582 B.R. at 593. We thus agree with the district

court that Section 928 does not mandate the turnover of special

revenues or require continuity of payments of the PRHTA Bonds

during the pendency of the Title III proceeding. Id.

The Insurers contest the district court's conclusion

that this reading of Section 928 is supported by the legislative

history of the 1988 Municipal Bankruptcy Amendments

("1988 Amendments"), Pub. L. No. 100-597 (1988). See Assured,

582 B.R. at 593 (quoting a Senate Report "stating that Section 928

'is intended to negate Section 552(a),' which 'could terminate the

security for municipal revenue bonds, but 'to go no further'"

(quoting S. Rep. No. 100-506, at 12-13, 22-23 (1988))). Because

the language of the statute is unambiguous, however, we find it

7 For its part, Section 928(b) allows debtors to offset "necessary
operating expenses" of a "project or system" from "[a]ny such lien
on special revenues" "derived from [that] project or system."
11 U.S.C. § 928(b).

-14-
unnecessary to turn to the legislative history. See Connecticut

Nat'l Bank v. Germain, 503 U.S. 249, 254 (1992) ("When the words

of a statute are unambiguous, then, th[e] first canon [of statutory

construction] is also the last: 'judicial inquiry is complete.'"

(quoting Rubin v. United States, 449 U.S. 424, 430 (1981))).

The Insurers next argue that Section 922(d) of the

Bankruptcy Code requires Debtors to continue to turn over the

revenues allegedly securing the PRHTA Bonds and exempts bondholder

enforcement actions from the automatic stays of Sections 362 and

922(a) of the Bankruptcy Code.

Pursuant to Section 362, an automatic stay goes into

effect upon the filing of a bankruptcy petition. See 11 U.S.C.

§§ 362, 901(a). "The automatic stay is one of the fundamental

protections that the Bankruptcy Court affords to debtors."

Jamo v. Katahdin Fed. Credit Union (In re Jamo), 283 F.3d 392, 398

(1st Cir. 2002). It is intended to "effectively stop all creditor

collection efforts, stop all harassment of a debtor seeking relief,

and to maintain the status quo between the debtor and [its]

creditors, thereby affording the parties and the [c]ourt an

opportunity to appropriately resolve competing economic interests

in an orderly and effective way." In re Witkowski, 523 B.R. 291,

296 (1st Cir. B.A.P. 2014) (alteration in original) (quoting Zeoli

v. RIHT Mortg. Corp., 148 B.R. 698, 700 (D.N.H. 1993)). The

-15-
automatic stay is "extremely broad in scope" and "appl[ies] to

almost any type of formal or informal action against the debtor or

the property of the estate," In re Slabicki, 466 B.R. 572, 580

(1st Cir. B.A.P. 2012) (quoting Patton v. Bearden, 8 F.3d 343, 349

(6th Cir. 1993)), including "any act to . . . enforce any lien

against property of the estate," 11 U.S.C. § 362(a)(4).8

Section 922(a) expands the scope of the Section 362

automatic stay in Chapter 9 cases to "action[s] or proceeding[s]

against an officer or inhabitant of the debtor that seeks to

enforce a claim against the debtor," and to "enforcement of a lien

on or arising out of taxes or assessments owed to the debtor."9

11 U.S.C. § 922(a).

8 Section 362(b) establishes certain exceptions to Section
362(a)'s automatic stay, none applicable here. 11 U.S.C.
§ 362(b).

9 The statute reads as follows:

A petition filed under this chapter operates as a stay,
in addition to the stay provided by section 362 of this
title, applicable to all entities, of--

(1) the commencement or continuation, including the
issuance or employment of process, of a judicial,
administrative, or other action or proceeding against
an officer or inhabitant of the debtor that seeks to
enforce a claim against the debtor; and

(2) the enforcement of a lien on or arising out of
taxes or assessments owed to the debtor.

11 U.S.C. § 922(a).

-16-
 Section 922 further provides that notwithstanding the

automatic stays under Sections 362 and 922(a), "a petition filed

under [Chapter 9] does not operate as a stay of application of

pledged special revenues in a manner consistent with [S]ection

[928][10] of [Chapter 9] to payment of indebtedness secured by such

revenues." 11 U.S.C. § 922(d). That is, pursuant to Section

922(d), the automatic stays of Sections 362 and 922(a) do not stay

the "application" of "pledged special revenues" to payment of debt

secured by such revenues.

The Insurers take issue with the district court's

conclusion that although Section 922(d) "excepts the 'application'

of special revenues from the automatic stay" -- and thus allows

for voluntary payment by the debtor, "including the application of

the debtor's funds held by a secured lender to secure indebtedness"

-- it does not except bondholder actions seeking to enforce special

revenue liens, Assured, 582 B.R. at 595-96, or otherwise impose a

payment obligation, id. at 594. They allege that the district

court's reading of Section 922(d) renders it "superfluous" because

nothing prevents voluntary action of the debtor even in the absence

of Section 922(d). Thus, their argument goes, Section 922(d)'s

purpose is to exempt bondholder enforcement actions from the stay

10 The statute states "section 927," which the parties and the
district court agree appears to be a scrivener's error.

-17-
when their lien is secured by pledged special revenues. According

to the Insurers, Section 922(d) operates as an absolute,

categorical exception to the automatic stay imposed by Sections

362 and 922(a) of the Bankruptcy Code, compelling the PRHTA to

continue to remit the proceeds of the Special Revenues into the

Reserve Accounts (after covering its operating expenses) and

allowing actions by bondholders to enforce their rights to those

revenues.

Again, we turn first to the statute's language to

determine its meaning. Landreth, 471 U.S. at 685. Section

922(d)'s plain language establishes that the application of

pledged special revenues is not a violation of the automatic stay.

It thus permits a debtor to pay creditors voluntarily during the

pendency of the bankruptcy case and allows a secured claimholder

to apply special revenues in its possession to pre-petition debt

without violating the automatic stays of Sections 362 and 922(a).

Nothing in the statute's plain language, however, addresses

actions to enforce liens on special revenues, which are

specifically stayed by Section 362(a)(4) of the Bankruptcy Code,

or allows for the compelling of debtors, or third parties holding

special revenues, to apply special revenues to outstanding

obligations. When Congress wants to command performance, turnover,

or payment, it knows how to do so expressly. See, e.g., 11 U.S.C.

-18-
§ 365(d)(5) (providing that a "trustee shall timely perform all of

the" debtor's obligations); § 542(a) (instructing that "an entity"

in possession of estate property "shall deliver" it to the

trustee); § 542(b) (directing that "an entity . . . shall pay such

debt to . . . "). By contrast, Section 922(d), as the district

court found, "simply carves out one type of action (application of

special revenues) from the automatic stay, without addressing any

other constraints that may apply to that action, without any grant

of relief from other aspects of the automatic stay, [ ] without

imposing any requirement that the action be taken," and without

offering any language of the consequences of failing to apply

pledged special revenues to continued bond payments. Assured, 582

B.R. at 594; see also 6 Collier on Bankruptcy ¶ 922.05 (16th ed.

2018) (stating that "[S]ection 922(d) is limited to an exception

from the automatic stay [and] does not suggest that its language

compels payment of special revenues in the possession of the

municipality").

Our construction of Section 922(d) complies with the

tenet that in construing statutory provisions we must be mindful

of "the broader context of the statute as a whole" and avoid

creating a conflict between various sections. Robinson, 519 U.S.

at 341; see also La. Pub. Serv. Comm'n v. FCC, 476 U.S. 355, 370

(1986). Although Section 922(d) provides an exception from the

-19-
automatic stays of Sections 362 and 922(a), it does not carve out

Section 904 of the Bankruptcy Code. Therefore, Section 904, and

its analog at Section 305 of PROMESA -- which prohibits judicial

interference with the debtor's property or revenues11 -- remains

in full force in determining the effect of Section 922(d). Our

construction that Section 922(d) permits rather than mandates

payment during the course of the bankruptcy proceedings gives

effect to that section without running afoul of Section 305 of

PROMESA. See 6 Collier on Bankruptcy ¶ 922.05 (16th ed. 2018)

(noting that a broader reading of Section 922(d), such as the one

the Insurers advance, "could run afoul of [S]ection 904, which

prohibits the court from interfering with any of the property or

revenues of the debtor") (internal quotation marks and citation

omitted).12

11 Specifically, Section 904 of the Bankruptcy Code establishes:

Notwithstanding any power of the court, unless the
debtor consents or the plan so provides, the court
may not, by any stay, order, or decree, in the case
or otherwise, interfere with: (1) any of the political
or governmental powers of the debtor; (2) any of the
property or revenues of the debtor; or (3) the
debtor's use or enjoyment of any income-producing
property.

11 U.S.C. § 904. Section 305 of PROMESA mirrors this language.
See 48 U.S.C. § 2165.

12 The Insurers argue that Section 305 poses no impediment to
their more liberal construction of Section 922(d). Citing In re
City of Stockton, 478 B.R. 8, 22 (Bankr. E.D. Cal. 2012) and In re

-20-
 Furthermore, contrary to the Insurers' contention, our

construction does not render Section 922(d) superfluous. Before

Congress adopted the 1988 Amendments it was unclear whether Section

362(a) stayed a creditor from accepting voluntary payments from a

County of Orange, 179 B.R. 185, 190 (Bankr. C.D. Cal. 1995), the
Insurers argue that Section 305 of PROMESA does not foreclose the
relief they seek under Section 922(d) of the Bankruptcy Code
because, according to them, the latter is more specific than the
former and a "specific statute controls over a general without
regard to priority of enactment." Their argument is premised on
faulty grounds.

First, if Section 922(d) clearly mandated what the Insurers
contend, their argument would be stronger, and we would need to
examine whether one section of PROMESA controls over another.
But, when the plain language of a section is clear, we will not
assign it an alternate interpretation that clashes with other
clearly written sections. As Congress knows how to command
performance when it wants to, so too does it know how to create
exceptions to general rules when that is its intent. And, while
Section 922(d) provides an exception from the automatic stays of
Sections 362 and 922(a), it does not similarly provide an exception
from Section 904 of the Bankruptcy Code.

Second, the cases cited by the Insurers are clearly inapposite.
Section 305, like Section 904, prohibits judicial interference
with the property and revenues of the debtor "unless the Oversight
Board consents or the plan so provides." 48 U.S.C. § 2165. The
cases cited by the Insurers considered the debtors' voluntary
filing of the bankruptcy petitions as their consent for the
exercise of the court's powers over the debtors. Thus, in the
cases that the Insurers cite, Section 904 posed no impediment to
the courts' exercise of its power over the debtor. Yet, we
recently rejected this approach in Fin. Oversight & Mgmt. Bd. for
P.R. v. Ad Hoc Grp. of PREPA Bondholders (In re Fin. Oversight &
Mgmt. Bd. for P.R.), where we held that the Board's filing of the
Title III petition could not be construed as consent to interfere
with the debtor's property or revenues because such construction
"would render Section 305 a nullity." 899 F.3d 13, 19 (1st Cir.
2018).

-21-
debtor. See, e.g., In re Hellums, 772 F.2d 379, 380-81 (7th Cir.

1985) (per curiam) (noting that a creditor's "continued acceptance

of the payments under the circumstances was a violation of the

stay regardless of the voluntary or involuntary nature of the

payments") (internal quotations omitted). Thus, Section 922(d)

served to clarify that a creditor's acceptance of a debtor's

voluntary payments are excepted from the automatic stay.

The Insurers also point us to In re Jefferson Cty.,

474 B.R. 228 (Bankr. N.D. Ala. 2012), to support their contention

that Section 922(d) mandates the turnover of special revenues.

We, however, find Jefferson County inapposite. In Jefferson

County -- where the county did not contest that the creditors held

a lien on the special revenues or whether it should turn over

special revenues if said revenues were determined covered by the

scope of the lien -- the issue was what revenues were covered by

the lien, rather than whether Sections 922(d) and 928 require

remittance of special revenues during the automatic stay. Because

the court in Jefferson County did not address whether the debtor's

payments were voluntary or mandatory, that case does not support

the Insurers' argument that Section 922(d) mandates the turnover

of special revenues.

The Insurers also challenge the district court's

conclusion that its reading of Section 922(d) is consistent with

-22-
the legislative history of the 1988 Amendments. See Assured,

582 B.R. at 594-95 (noting that Congress recognized that a

municipality might want to continue to pay bondholders through the

course of Chapter 9 bankruptcy proceedings in order to "retain

access to credit markets" and -- mindful that the automatic stay

"broadly prohibits all collection efforts against a debtor

including the application of the debtor's funds held by a secured

lender to secure indebtedness" -- "sought to permit such third-

party applications . . . to proceed without having to seek relief

from the automatic stay." (citing S. Rep. No. 100-506, at 6-7,

11, 21 (1988))) (internal quotation marks omitted). But again,

because we find the statute's language unambiguous, there is no

need to rely on legislative history. See Connecticut Nat'l Bank,

503 U.S. at 254.

We thus agree with the district court that Section 922(d)

only makes clear that the automatic stay is not an impediment to

continued payment, whether by the debtor or by another party in

possession of pledged special revenues, of indebtedness secured by

such revenues. See Assured, 582 B.R. at 594-95.

The Insurers and their amici make several arguments

rooted in social policy and consideration of fairness urging the

court to adopt their proposed broader construction of Sections

928(a) and 922(d), and advance their theory about the possible

-23-
effect upholding the district court's interpretation might have on

the municipal bonds market. Our duty, however, is to interpret

the law, not to re-write it. See Obergefell v. Hodges, 135 S. Ct.

2584, 2611 (2015) (Roberts, J., dissenting) ("[J]udges have power

to say what the law is, not what it should be.").

III. Conclusion

In sum, Sections 928(a) and 922(d) permit, but do not

require, continued payment during the pendency of the bankruptcy

proceedings. The two provisions stand for the premise that any

consensual prepetition lien secured by special revenues will

survive the period of municipal bankruptcy, and, accordingly,

municipalities can elect to voluntary continue payment on these

debts during the course of the bankruptcy proceedings so as to not

fall behind and thus be at risk of being unable to secure financing

in the future. Because neither provision requires Debtors to

continue to remit the PRHTA Pledged Special Revenues into the

Reserve Accounts or continue payments to bondholders during the

pendency of the Title III proceedings, the district court properly

dismissed the first, third, and fourth claims of the Amended

Complaint.

Affirmed.

-24-