Puerto Rico Governor Ricardo Rosselló notified the island's Fiscal Control Board Wednesday that he would seek a form of bankruptcy protection after failed negotiations with creditors.

The announcement came as multiple creditors sued the island's government after a moratorium on lawsuits lapsed Monday.

Rosello activated Title III of the PROMESA bill, which provides a protection similar to bankruptcy that will allow the territory to restructure its debt under court supervision.

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Congress passed PROMESA last year to avert insolvency for Puerto Rico, creating the Fiscal Control Board, a panel of seven financial managers appointed by Congress to oversee the island's budget.

"The decision today by Puerto Rico’s governor to seek a judicial reorganization of the island’s debts and put its finances on solid footing is the responsible thing to do," said House Democratic Whip Steny Hoyer (Md.) in a statement.

Puerto Rico has over $70 billion in bond debt and $50 billion in pension obligations.

"We've maintained our position to negotiate in good faith, but under the current scenario we are going to protect the people," Rosselló said in a Facebook post.

Simon Johnson, a professor of entrepreneurship at the MIT Sloan School of Management, warned Tuesday that failure to activate Title III would result in "chaos," as creditors filed lawsuits in multiple courts.

The Title III process will allow the FCB to renegotiate debt, ultimately allowing Puerto Rico to pay only a percentage of what it owes.

The bankruptcy-like motion is the largest public debt restructuring process in American history, dwarfing Detroit's $18 billion to $20 billion 2013 bankruptcy.

The island has been mired in recession for over 10 years, causing many Puerto Ricans to migrate to the 50 states. Puerto Rico has lost more than 10 percent of its population in that period.