Puerto Rico took out a full-page ad on its own behalf in The Wall Street Journal as it mounts a full-court press to convince investors that it's creditworthy. The ad contains a letter from Gov. Alejandro Garcia Padilla that says, "We will do everything necessary for Puerto Rico to honor all its commitments."
That was the message as the island's treasury secretary and the chairman of the Government Development Bank for Puerto Rico traveled to New York this week to make their case with financial journalists. Investors have grown increasingly wary about Puerto Rico's indebtedness—and concerned about their own bond holdings—as focus sharpens on the $70 billion owed by the commonwealth.
In an interview with CNBC, the two officials outlined the steps the government has taken to reduce spending and raise revenue, and shared their expectation that the deficit for Puerto Rico's current fiscal year will fall from $2.2 billion to $820 million. The commonwealth expects to have a balanced budget by 2016. (Puerto Rico's fiscal year runs from July 1 to June 30. It's currently in its 2014 fiscal year.)
(Related video: Puerto Rico seeks to calm investors about debt)
Puerto Rico's public agencies, also struggling in the capital markets, have taken steps as well, said Treasury Secretary Melba Acosta. For example, water rates were hiked 60 percent to bring in $300 million to $400 million in order to assure holders of bonds guaranteed by those revenues.
David Chafey, head of the development bank, said he's received visits from investors who are looking to lend money via private placements. He declined to identify them or say how many but suggested the lending costs were higher than Puerto Rico wants to accept.
"The ideal is to go back to the capital markets," Chafey said. "But we will do that when market conditions and spreads are what they should be."
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Originally, the island had hoped to borrow more than $2 billion this fiscal year. But Chafey said that through budget cuts, Puerto Rico has reduced its borrowing needs to between $500 million and $1 billion, and it would like to borrow "sometime before June 30."
If need be, Chafey said, the development bank can take other measures and not borrow any money at all this year. He pointed to a liquidity cushion in the form of the bank's $2.7 billion investment portfolio, which is made up of liquid assets such as Treasurys and mortgage-backed securities, with an average duration of three years. That gives Puerto Rico "breathing room," Chafey said.
Most of Puerto Rico's $70 billion in debt is publicly traded, and some of it has fallen in value as investors grow increasingly worried about the island's ability to pay it back due to years of recession or little-to-no growth.
Puerto Rico's debt is held in more than 70 percent of all municipal bond funds in the United States, due in large part to the fact that it carries a triple exemption: Interest paid by Puerto Rico is not subject to U.S. federal, state or local taxes.
Not in the clear just yet
The island's efforts have helped but not solved its issues. After a three-hour conference call with more than 2,000 listeners earlier in October, the S&P Muni-Bond Puerto Rico Index moved higher. Despite being off its lows, however, it's still sharply below where it was last December.
Part of what may be hurting Puerto Rico's ability to recover is the uncertainty about how a bankruptcy process or a restructuring would work legally. The island can't file for Chapter 9 like Detroit did.
(Read more: Is Detroit really broke? Court to decide and Detroit joins these towns that have 'gone bust')
Although it is not a state, it is a commonwealth of the United States, and not allowed to declare bankruptcy. It's unclear what code or protocol would be followed.
(Read more: Oppenheimer dives into Puerto Rican debt)
Acosta reiterated that the island's constitution requires Puerto Rico to prioritize debt payments when it comes to deciding what gets paid first during a crisis (unlike the United States, which does not have a law regarding prioritization). However, because the bonds were issued under Puerto Rican law, investors may be concerned that the island could impose changes to its laws and its constitution retroactively, much as Greece did as part of its restructuring last year.
Some hedge funds contacted by CNBC believe that in a worst-case scenario, the federal government would bail out Puerto Rico. When asked about the possibility, Chafey shook his head in frustration, and Acosta said: "They have never offered a bailout. We have never asked for a bailout."
—By CNBC's Michelle Caruso-Cabrera. Follow her on Twitter