For the first time in its 81-year history, the Export-Import Bank of the United States was not reauthorized by Congress earlier this year, but a recent vote in the House of Representatives has put its charter back on the table.
The agency, which helps U.S. companies decrease risk when exporting products, expired at midnight June 30 after the House failed to call a vote before going to recess. Since then, the Ex-Im Bank has not been able to process applications or conduct new business.
Since 2007, the Ex-Im Bank has been a resource for roughly 30 businesses in Westchester and Rockland counties and helped facilitate about $820 million in exports, according to the bank”™s online database.
U.S. Rep Nita M. Lowey, a Democrat whose district includes all of Rockland County and part of Westchester County, has been an outspoken proponent of the bank.
“The agency”™s guaranteed financing has helped dozens of companies throughout the Lower Hudson Valley, and failure to reauthorize the Ex-Im Bank”™s charter could mean job losses not only for those exporters, but also their extensive supply chains,” she said.
Curtis Instruments Co., a Mount Kisco-based business for 55 years, makes instruments and control systems for electric vehicles such as wheelchairs and golf carts for markets in the Americas, Europe and Asia.
Frank Matheis, director of corporate communications at Curtis, said the company has used the Ex-Im Bank for loan guarantees, which he said has allowed the company to take on some risk and do transactions abroad.
“If you absorb all the risk without any backing, then companies are in a position where they would assume all the risk,” Matheis said. “But the (Ex-Im Bank) stands behind the companies.”
Mary-Ellen Storino is the CFO of Purchase-based Agri-Dairy Products Inc., a company that sells dairy ingredients to customers in Asia, South America, Mexico and the Caribbean and has not used the Ex-Im bank in more than a year.
In the last eight years, the company did secure roughly $4 million in exports with support from the agency, according to the Ex-Im Bank”™s online database.
“In hindsight, it is a great tool in order to allow open terms to international customers,” she said.
The agency provides financing such as loan guarantees and insurance to American companies that have an international buyer. In addition, it supports international buyers with medium- and long-term financing loans up to 85 percent of the contract after at least a 15 percent cash payment.
But conservatives argue American taxpayers have to pay back the loans foreign companies default on.
John Allan James, chairman emeritus of Pace University”™s Center for Global Governance, Reporting and Regulation, said that perception is inaccurate.
“There”™s never been any taxpayer payment,” he said. “The profits made from the deals that were good, covered any losses.”
In other words, the fees and interest the agency charges with its services help cover any deficits from deals that fall through.
“The Ex-Im Bank has played an important role, and hopefully will continue to do so, for both huge U.S. corporations and their sourcing partners here in the states and abroad,” James said.
The bill to reauthorize the Ex-Im Bank will go to the Senate next. News reports have said the bill likely won”™t be voted on by itself, but rather as an attachment to a highway-funding bill in the coming weeks.
