When developing countries need to deepen a canal for irrigation or navigation, they frequently call on Ellicott Dredges, a 129-year-old Baltimore-based maker of dredging equipment.
To sell their massive, multimillion-dollar machines abroad, Ellicott Dredges often turns to the U.S. Export-Import Bank — an obscure federal agency that facilitated more than $37 billion in exports last year.
Critics say the bank is a corporate welfare program that has outlived its usefulness and now benefits mostly businesses that don't need it.
But supporters say it remains a critical tool for developing the nation's manufacturing sector amid global competition — and that dismantling it would amount to unilaterally disarming in a world in which businesses in other countries rely on similar government programs.
Lawmakers will have a few weeks to decide the bank's future when they return to Washington in September. Without congressional action, the bank's charter is set to expire at the end of that month.
For Peter Bowe, president of Ellicott Dredges, reauthorizing the program is a no-brainer. His company, based in the Carroll-Camden Industrial Area, employs about 130 people.
"There's certainly no effort, no attempts and no talk of any of the foreign export banks going away," he said.
Created by President Franklin D. Roosevelt in 1934, the bank — like its counterparts in Germany, China and Canada — guarantees loans used to finance the sale of goods and services abroad. The bank, backed by U.S. taxpayers, pays the bill if a foreign buyer defaults. The guarantee means importers pay significantly lower interest rates than would otherwise be available.
The Export-Import Bank has supported $2 billion in exports from 77 Maryland companies since 2007, according to the agency's own estimates.
But critics, including House Finance Committee Chairman Jeb Hensarling, note that the bulk of the benefit goes to behemoths such as Boeing, General Electric and Caterpillar. More than half of the bank's loans and guarantees supported Chicago-based Boeing in 2011.
"So if you're a politically connected bank or company that benefits from Ex-Im, no doubt you would like it to continue," Hensarling, a Texas Republican, said during a hearing this summer. "After all, it's a sweetheart deal for you. Taxpayers shoulder the risk, and you get the reward."
Others question the bank's impact — it finances less than 5 percent of all U.S. exports — and say they worry that propping up one industry could have unexpected consequences in other sectors of the economy.
The bank's total exposure — the outstanding principal of all loans made, guaranteed, or insured — stood at $89 billion in 2011.
Supporters say many deals financed by the bank wouldn't materialize without it. And they point out the bank makes money for taxpayers. The agency has returned $4.9 billion more to the treasury than it has received in appropriations since 1990, according to the nonpartisan Congressional Research Service.
"Without Ex-Im, it would be a different world for us," said Jeff Hanson, vice president of international finance for Barry-Wehmiller, a Missouri-based company that owns MarquipWardUnited, which has about 300 employees in Maryland.
The company's Cockeysville plant makes machines that print and cut corrugated cardboard that is used to encase everything from pizzas to large consumer products.
According to Export-Import Bank estimates, the agency has helped MarquipWardUnited complete more than $7 million in export sales from Maryland since 2007. The company sells its multimillion-dollar machines around the globe.
Whenever Hanson hears critics arguing the bank isn't necessary, he said, he thinks: "That is someone who is not out in the real world trying to sell products."
Like Bowe at Ellicott Dredges, Hanson said his company competes with manufacturers in countries with more robust export banks. China's bank allocated more than three times the amount the U.S. invested in medium- and long-term credit deals in 2010. Germany spent about 73 percent more than the U.S. that year.
Bobby Patton, president and CEO of Gaithersburg-based Patton Electronics, uses an Export-Import Bank program that guarantees a line of credit against his receivables so he can better manage cash flow.
Patton employs about 140 employees and exports telecommunication and computer equipment to more than 140 counties.
Because those products cost less than, say, an airplane, but are sold at a higher volume to more customers, Patton said, private insurers aren't as equipped to offer short-term credit on those sales.
Patton said he is trying to prepare for the possibility that the bank is not reauthorized.
"I haven't found a solution yet," he said.
Patton describes himself as a conservative, but he said Republican criticism of the bank is misplaced.
"I don't think they should be focused on Ex-Im Bank as the thing to kill," he said. "That's not where the real problem is in government."
Debate over the bank on Capitol Hill comes as the Obama administration has sought to double U.S. exports by next year. The country exported just under $2.3 trillion in goods and services in 2013, up about 23 percent from 2010.
Republicans in Congress are divided on reauthorizing the bank; most Democrats support it. A bipartisan effort in the Senate to extend the bank's charter for five years is unlikely to gain traction among House conservatives.
Democratic Rep. John Delaney of Montgomery County, a banker before he was elected to the House in 2012, serves on the committee that oversees the Export-Import Bank.
"I believe in free markets and a robust private sector and don't want the government distorting financial markets, ever," he said in a statement. "But the fact is that it's difficult for U.S. companies to secure financing for certain international business transactions and Ex-Im plays an important role in filling that void. The data suggest that Ex-Im has done this is in a disciplined, and taxpayer-friendly way."
Rep. Andy Harris, Maryland's sole GOP lawmaker, was one of 93 Republicans who voted against the last reauthorization in 2012. He could not be reached for comment.
Republican-leaning business groups, including the U.S. Chamber of Commerce and the National Association of Manufacturers, support the reauthorization. Nine Republican governors joined 20 Democrats, including Maryland Gov. Martin O'Malley, on a letter to congressional leaders last month calling for the bank's reauthorization. Other Republican governors have sent letters of support separately.
Conservative Republicans are likely to seek changes to the agency in exchange for agreeing to reauthorize the bank, but it's not clear specifically what those lawmakers have in mind.
Christopher Wenk, senior director of international policy at the Chamber of Commerce, said the group is open to some changes — such as improving access for small and medium-sized companies — as long as it advances reauthorization.
"There are improvements that can be made," Wenk said. "But, by and large, we're hoping to see a bill that extends the life of the bank."