Temporary spending bill could end Ex-Im Bank logjam
WASHINGTON — The Obama Administration is seeking language in a temporary spending bill Congress must pass by the end of September that would allow the Export-Import Bank of the United States to resume approvals of large deals, including those involving commercial satellites.
The White House Office of Management and Budget (OMB) submitted to Congress Aug. 29 a list of requested policy provisions called anomalies to a continuing resolution (CR) that would fund the federal government for up to several months after the 2017 fiscal year begins Oct. 1. The anomalies are changes to a CR that would otherwise continue programs at 2016 funding levels.
One of the requested anomalies seeks to effectively re-open the Ex-Im Bank for large deals. Although Congress reauthorized the bank in December 2015 after its authorization to do new business expired the previous June, three of the five seats on its board of directors are currently vacant. Since the board lacks a quorum, it cannot vote to approve new deals valued at more than $10 million.
The OMB is requesting that the CR include language allowing, in the case where the board lacks a quorum, all the members of the board to approve new transactions. The provision would be valid through September 2019.
“Without the anomaly, the Export-Import Bank would be unable to approve new transactions valued at over $10 million, which has significantly hampered the Export-Import Bank’s operations and has caused a number of U.S. companies to relocate some of their business overseas in order to obtain financing from foreign Export Credit Agencies,” the OMB stated in its request for the anomaly.
The OMB notes that the language it is requesting be included in the CR is similar to that already in appropriations bills in Congress. The Senate version of a State Department and Foreign Operations spending bill, approved by Senate appropriators in June but not yet taken up by the full Senate, includes a similar provision.
The list of requested anomalies is the start of negotiations between the White House and Congress on both the content of a CR and its duration. Congress will start work on a CR when it reconvenes from its summer break on Sept. 6.
The lack of a quorum for the Ex-Im Bank’s board has prevented it from approving any deals to finance sales of commercial satellites, which are valued at far more than $10 million. In recent years, commercial satellite manufacturers such as Boeing and Orbital ATK have used Ex-Im financing as a competitive tool to win business from satellite operators.
The proposal is endorsed by the Aerospace Industries Association (AIA), which has been a proponent for both earlier efforts reauthorization for the Ex-Im Bank and, more recently, to restore the board’s quorum so it can approve aviation and satellite deals.
“In an ideal world, the Ex-Im Board would be completely filled, but absent that possibility, AIA supports any fix that permits the Ex-Im Bank to be fully functional again,” AIA spokesman Dan Stohr said Aug. 31.
The administration sought to restore a quorum in January by nominating to the Ex-Im Bank board J. Mark McWatters, a Texas Republican who is currently on the board of the National Credit Union Administration. That nomination has yet to be taken up by the Senate Banking Committee, whose jurisdiction includes the Ex-Im Bank. The committee is currently chaired by Sen. Richard Shelby (R-Ala.), a critic of the Ex-Im Bank.