U.S. Sen. David Vitter introduced an amendment to the Export-Import Bank Reauthorization bill that reforms the way the federal government loans money to energy projects. His amendment would prohibit the bank from financing oil and gas development projects in foreign countries that are similar to projects in the U.S. when there exists federal funding for those domestic projects. The amendment would also end the practice of taxpayers becoming the priority lender in bankruptcy, such as Solyndra, and ends the mandate for loans to renewable projects like Fisker.
"The federal government is loaning billions to foreign government-owned energy entities to produce abroad but is still cutting off our abundant domestic supply," Vitter said. "I'm not saying the bank should stop loaning, just that its objectives needs to be reconfigured. My common-sense amendment would make sure they're aware of similar -- or competitive -- domestic projects before sending billions to foreign-owned companies to subsidize work we can do here. It also prevents taxpayers from becoming the bankruptcy victim for failed projects like Solyndra or potentially funding "green" manufacturing jobs going overseas, like Fisker."
Vitter has questioned the administration and the Export-Import Bank in the past on loans going to foreign energy development and criticized the bank for loans that were made to Brazilian and Colombian state-run energy companies. Just last week, Ex-Im Bank authorized a $3 billion loan to support an Australian natural gas company.
Vitter's amendment would do the following:
* Prevent any further "Solyndra" type lending, where the taxpayer holds a subordinate position to other loans. In February 2011, the Ex-Im bank approved a $10 million loan guarantee in effort to help Solyndra stay afloat by selling solar panels to a single customer in Belgium. This was 10 months before they went bankrupt.
* Ensure that prior to financing any international projects for fossil fuels (natural gas, petroleum, coal), the bank would first have to identify domestic projects that are substantially similar and whether they are eligible for any type of federal funding.
* Eliminates the mandate that 10 percent of Ex-Im's loans be for renewable energy projects (so lending is based on economics and not mandates). It would also require that lending for renewable energy projects be made from domestically manufactured products.