June 26 (Bloomberg) -- With the fate of the U.S. Export-Import Bank hanging in the balance, a group of House Republicans met today to discuss ways the agency could be restructured to satisfy critics who want it shut down.
Republican members of the House Financial Services Committee met privately and talked about altering the bank’s accounting practices and requiring annual audits, said Representative Stephen Fincher of Tennessee, a member who attended the meeting.
The committee is considering whether to reauthorize the 80-year-old bank, which will shut Sept. 30 if no action is taken. The institution provides loan guarantees, loans and insurance to help U.S. exports.
“There is much support on the committee for reforming and reauthorization,” Fincher said today in a phone interview. “We’re working with the chairman and can hopefully have something next week.”
Fincher said that during next week’s congressional recess he will work with members to craft acceptable language to win support for reauthorization. He said ideas discussed today included stripping the bank of loan-making powers to focus on loan guarantees. They also discussed ways to provide more help to small- and medium-sized businesses.
“Just cutting it off cold turkey probably is not the responsible thing to do,” he said.
Committee Chairman Jeb Hensarling, a Texas Republican, is among party leaders who want to shut it because it gives what they call “corporate welfare” to beneficiaries including Boeing Co. and General Electric Co. House Majority Leader-elect Kevin McCarthy of California this week joined opponents of the bank, saying the private sector can do the same job.
Hensarling spokesman David Popp declined to comment on the meeting. Elizabeth Lauten, a Fincher spokeswoman, said Hensarling attended. McCarthy’s spokesman Mike Long didn’t respond to questions. It couldn’t be learned if McCarthy, a committee member, attended.
Fincher, who said Ex-Im supports about 1,000 jobs in his western Tennessee district, said he discussed saving the bank today with McCarthy, who backed reauthorization two years ago.
“He even knows that this is something, with reforms, this is good for the jobs and good for our districts,” he said of McCarthy, who he called one of his best friends in Washington.
Changes are needed to make the lender more accountable to taxpayers and the Congress, Fincher said after the meeting.
Last year it supported $37 billion in exports -- about 2 percent of all U.S. goods exports, according to its annual report. Small businesses accounted for 89 percent of the total number of deals, it said.
President Barack Obama’s administration has proposed renewing the bank’s charter for five years, with a $160 billion lending cap, up from the current level of $140 billion.
“Manufacturers welcome constructive conversation and are encouraged by recent activity and potential movement around reauthorization,” said Linda Dempsey, vice president for international economic affairs at the National Association of Manufacturers, which is lobbying to keep Ex-Im in business. “Allowing the Ex-Im Bank to close would be a gift to our competitors and would result in the loss” of U.S. jobs.
At a committee hearing yesterday, Republicans Peter King of New York and Randy Hultgren of Illinois also said the bank shouldn’t go out of business, disagreeing with the mounting opposition to the institution among the party’s leadership.
Delta Air Lines Inc. is leading calls for changes, requesting an end to the bank’s lending to help airlines backed by foreign government buy wide-body Boeing jets. Company Chief Executive Officer Richard Anderson told the committee yesterday that previous efforts to reform the bank were “totally ignored.”
In the House, at least two renewal proposals have emerged. Representative John Campbell, a California Republican, said he is drafting a measure to keep the bank in business for three years and trim the lending cap to $95 billion. Representative Denny Heck, a Washington Democrat, said he has a bill to renew the bank through 2021 and raise the limit to $175 billion.
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