U.S. Senate Banking Committee Ranking Member Pat Toomey (R-Pa.) is raising concerns over a new program the Export-Import Bank of the United States (EXIM) may soon launch to finance domestic manufacturing and domestic infrastructure, areas far outside EXIM’s statutory mandate.
Although the bank has not published a comprehensive framework for this unprecedented program or subjected it to a public notice-and-comment rulemaking process, EXIM’s Board of Directors is scheduled to vote on adopting the new Domestic Financing Program this spring.
As Ranking Member Toomey points out, the Domestic Financing Program would provide taxpayer subsidies to domestic manufacturing facilities and infrastructure projects even if the EXIM-financed project does not directly export anything.
“This is worse than mission creep,” Ranking Member Toomey wrote. “It subverts Congressional intent and strains EXIM’s statutory mandate to such an extent to make it meaningless. There is no reason for EXIM to provide domestic financing. The United States has the largest and most highly developed market economy in the world; promising businesses have unrivaled access to capital on competitive terms. Just like with all of EXIM’s other programs—and perhaps more so—EXIM could only win domestic financing business if it finances bad deals that the private sector refuses to underwrite, or if it underprices the risk associated with those deals, putting taxpayers needlessly at risk.”
Ranking Member Toomey urged EXIM not present this program for consideration by EXIM’s Board of Directors without first publishing a comprehensive framework for the program and receiving public comments on it. He also requested that EXIM respond to a number of written questions regarding the Domestic Financing Program no later than March 23, 2022.
To read Senator Toomey’s full letter to EXIM, click here.