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104th Congress                                                   Report
                        HOUSE OF REPRESENTATIVES

 2d Session                                                     104-722
_______________________________________________________________________


 
                 EXPORTS, JOBS, AND GROWTH ACT OF 1996

                                _______
                                

 July 30, 1996.--Committed to the Committee of the Whole House on the 
              State of the Union and ordered to be printed

                                _______
                                

 Mr. Gilman, from the Committee on International Relations, submitted 
                             the following

                              R E P O R T

                        [To accompany H.R. 3759]

      [Including cost estimate of the Congressional Budget Office]

  The Committee on International Relations, to whom was 
referred the bill (H.R. 3759) to extend the authority of the 
Overseas Private Investment Corporation, and for other 
purposes, having considered the same, report favorably thereon 
with an amendment and recommend that the bill as amended do 
pass.
  The amendment is as follows:
  Strike out all after the enacting clause and insert in lieu 
thereof the following:

SECTION 1. SHORT TITLE.

  This Act may be cited as the ``Exports, Jobs, and Growth Act of 
1996''.

            TITLE I--OVERSEAS PRIVATE INVESTMENT CORPORATION

SEC. 101. INCOME LEVELS.

  Section 231 of the Foreign Assistance Act of 1961 (22 U.S.C. 2191) is 
amended in paragraph (2) of the second undesignated paragraph--
          (1) by striking ``$984 or less in 1986 United States 
        dollars'' and inserting ``$1,280 or less in 1994 United States 
        dollars''; and
          (2) by striking ``$4,269 or more in 1986 United States 
        dollars'' and inserting ``$5,556 or more in 1994 United States 
        dollars''.

SEC. 102. CEILING ON INVESTMENT INSURANCE.

  Section 235(a)(1) of the Foreign Assistance Act of 1961 (22 U.S.C. 
2195(a)(1)) is amended by striking ``$13,500,000,000'' and inserting 
``$25,000,000,000''.

SEC. 103. CEILING ON FINANCING.

  Section 235(a)(2)(A) of the Foreign Assistance Act of 1961 (22 U.S.C. 
2195(a)(2)(A)) is amended by striking ``$9,500,000,000'' and inserting 
``$20,000,000,000''.

SEC. 104. ISSUING AUTHORITY.

  Section 235(a)(3) of the Foreign Assistance Act of 1961 (22 U.S.C. 
2195(a)(3)) is amended by striking ``1996'' and inserting ``2001''.

SEC. 105. POLICY GUIDANCE.

  Section 231 of the Foreign Assistance Act of 1961 (22 U.S.C. 2191) is 
amended in the first paragraph--
          (1) by striking ``To mobilize'' and inserting ``To increase 
        United States exports to, and to mobilize'';
          (2) by striking ``of less developed'' and inserting ``of, 
        less developed''; and
          (3) by inserting ``trade policy and'' after ``complementing 
        the''.

SEC. 106. BOARD OF DIRECTORS.

  Section 233(b) of the Foreign Assistance Act of 1961 (22 U.S.C. 
2193(b)) is amended--
          (1) by striking the second and third sentences;
          (2) in the fourth sentence by striking ``(other than the 
        President of the Corporation, appointed pursuant to subsection 
        (c) who shall serve as a Director, ex-officio)'';
          (3) in the second undesignated paragraph--
                  (A) by inserting ``the President of the Corporation, 
                the Administrator of the Agency for International 
                Development, the United States Trade Representative, 
                and'' after ``including''; and
                  (B) by adding at the end the following: ``The United 
                States Trade Representative may designate a Deputy 
                United States Trade Representative to serve on the 
                Board in place of the United States Trade 
                Representative.''; and
          (4) by inserting after the second undesignated paragraph the 
        following:
  ``There shall be Chairman and a Vice Chairman of the Board, both of 
whom shall be designated by the President of the United States from 
among the Directors of the Board other than those appointed under the 
second sentence of the first paragraph of this subsection.''.

                 TITLE II--TRADE AND DEVELOPMENT AGENCY

SEC. 201. TRADE AND DEVELOPMENT AGENCY AUTHORIZATION.

  Section 661(f)(1)(A) of the Foreign Assistance Act of 1961 (22 U.S.C. 
2191(f)(1)(A)) is amended to read as follows:
          ``(1) Authorization.--(A) There are authorized to be 
        appropriated for purposes of this section, in addition to funds 
        otherwise available for such purposes, $40,000,000 for fiscal 
        1997, and such sums as are necessary for fiscal year 1998.''.

  TITLE III--EXPORT PROMOTION PROGRAMS WITHIN THE INTERNATIONAL TRADE 
                             ADMINISTRATION

SEC. 301. EXPORT PROMOTION AUTHORIZATION.

  Section 202 of the Export Administration Amendments Act of 1985 (15 
U.S.C. 4052) is amended to read as follows:

``SEC. 202. AUTHORIZATION OF APPROPRIATIONS.

  ``There are authorized to be appropriated to the Department of 
Commerce to carry out export promotion programs $240,000,000 for fiscal 
year 1997 and such sums as are necessary for fiscal year 1998.''.

            TITLE IV--TRADE PROMOTION COORDINATING COMMITTEE

SEC. 401. STRATEGIC EXPORT PLAN.

  Section 2312(c) of the Export Enhancement Act of 1988 (15 U.S.C. 
4727) is amended--
          (1) by striking ``and'' at the end of paragraph (4);
          (2) by striking the period at the end of paragraph (5) and 
        inserting a semicolon; and
          (3) by adding at the end the following:
          ``(6) identify means for providing more coordinated and 
        comprehensive export promotion services to, and in behalf of, 
        small and medium-sized businesses; and
          ``(7) establish a set of priorities to promote United States 
        exports to, and free market reforms in, the Middle East that 
        are designed to stimulate job growth both in the United States 
        and the region.''.

SEC. 402. IMPLEMENTATION OF PRIMARY OBJECTIVES.

  The Trade Promotion Coordinating Committee shall--
          (1) identify the areas of overlap and duplication among 
        Federal export promotion activities and report on the actions 
        taken or efforts currently underway to eliminate such overlap 
        and duplication;
          (2) report on actions taken or efforts currently underway to 
        promote better coordination between State, Federal, and private 
        sector export promotion activities, including co-location, 
        cost-sharing between Federal, State, and private sector export 
        promotion programs, and sharing of market research data; and
          (3) by not later than September 30, 1997, include the matters 
        addressed in paragraphs (1) and (2) in the annual report 
        required to be submitted under section 2312(f) of the Export 
        Enhancement Act of 1988 (15 U.S.C. 4727(f)).

SEC. 403. PRIVATE SECTOR DEVELOPMENT IN THE UKRAINE.

  The Trade Promotion Coordinating Committee shall include in the 
annual report submitted in 1997 under section 2312(f) of the Export 
Enhancement Act of 1988 (15 U.S.C. 4727(f)) a description of the 
activities of the departments and agencies of the Trade Promotion 
Coordinating Committee to foster United States trade and investment 
which facilitates private sector development in the Ukraine.

                               I. Purpose

    H.R. 3759, the ``Exports, Jobs and Growth Act of 1996'', as 
amended, would extend the authority for three export assistance 
agencies: the Overseas Private Investment Corporation (OPIC), 
the Trade Development Agency (TDA), and the export-related 
programs of the Department of Commerce's International Trade 
Administration, (ITA). These authorities will otherwise expire 
at the end of this fiscal year. The bill also incorporates 
several recommendations made during hearings conducted by the 
Subcommittee on International Economic Policy and Trade as well 
as several provisions debated during the mark up of the bill by 
the full Committee.

                             II. Background

    Testimony from both the private sector and the 
Administration has verified the importance of these programs in 
expanding U.S. exports and in bolstering U.S. global 
competitiveness.
    The Committee is convinced that the OPIC, TDA and ITA 
financing and market development programs are essential in the 
efforts of U.S. companies to gain and preserve critical market 
share in overseas markets, particularly in the Big Emerging 
Markets and the Big Emerging Sectors identified by the U.S. 
Government's Trade Promotion Coordinating Committee. Without 
the assistance of such programs, U.S. exporters will be at a 
significant, and in some cases decisive, disadvantage in 
competing with foreign companies. This is not because foreign 
companies have better products or superior productivity, but 
because the U.S. government export assistance is crucial in 
countering the intervention and assistance being provided by 
foreign governments to their companies.
    The Committee also notes recent studies concerning the 
importance of exports to U.S. workers. Studies furnished to the 
Committee show that firms which export are more likely to stay 
in business, pay higher wages, provide greater benefits, and 
create more job opportunities than those firms which sell only 
into the domestic market. Even by the most conservative 
measures, exporter productivity is 20 percent higher than for 
non-exporters.
    The bill reflects the export community's broad, strong 
support for reauthorization. In addition to testimony received 
over the last year, the Committee has received letters in just 
the last month from such groups as the Coalition for Employment 
through Exports, the National Association of Manufacturers, the 
U.S. Chamber of Commerce, the National Foreign Trade Council, 
the Small Business Exporters Association, the American 
Consulting Engineers Council, the National Independent Energy 
Producers, and the US-Russia Business Council.
    A more detailed description of the programs and the bill's 
key provisions follows.

           The Overseas Private Investment Corporation (OPIC)

    OPIC began operations in 1971, with start up funds of $106 
million. It is a wholly owned U.S. government corporation that 
provides insurance and financing to U.S. companies investing in 
overseas markets. OPIC's mandate is to facilitate private 
sector investment in the developing world, to expand U.S. 
exports and to advance U.S. foreign and domestic policy goals, 
within certain statutory parameters and guidelines.
    During its 25 years of operations, OPIC estimates that is 
has generated $43 billion in U.S. exports to 140 countries, 
creating some 200,000 U.S. jobs.
    Significantly, OPIC is financially self-sustaining. Years 
ago it reimbursed the U.S. Treasury for its initial 
capitalization. Through its own operations it has built up $2.5 
billion in reserves to cover its contingent liabilities 
(including deposits at the U.S. Treasury).
    With a net income of $189 million in FY 1995, OPIC is able 
to cover its expenses and set reserves for its insurance and 
financial risks through its own earnings.
    The exporting community testified that OPIC's insurance and 
financing programs are essential to U.S. companies which are 
seeking to expand into newly emerging markets in Asia, Eastern 
and Central Europe, Latin America and the Middle East. Private 
sector risk insurance and financing are largely unavailable for 
these emerging markets.
    A February, 1996 independent study mandated by Congress 
found that the proposal for the privatization of OPIC is not a 
viable option. It found that the privatization of the agency is 
likely to cost taxpayers between $500 and $700 million and 
would cause the elimination of many of its services. The study 
found that ``OPIC has been a consistently strong performer in 
managing exposures, claims, recoveries and profits''.
    The bill reflects recommendations by both the exporting 
community and the Administration that OPIC continue to expand 
its level of assistance to U.S. companies. The bill provides 
that the level of OPIC's programs would gradually rise over the 
next 5 years.
    The bill also specifies that OPIC shall operate under U.S. 
trade policy as well as U.S. foreign policy guidelines and 
removes the statutory requirement that the AID Administrator 
also serve as the Chairman of the OPIC Board.

                   Trade and Development Agency (TDA)

    The Trade and Development Agency began operations in 1981. 
It is an independent agency under the direction of the 
President that funds engineering and feasibility studies for 
large capital projects overseas, principally in the energy, 
transportation, communications, environmental, and industrial 
sectors.
    Over time, TDA has proved that by supporting the initial 
design studies, the U.S. effectively influences the follow-on 
procurement decisions toward U.S. companies. As a result, TDA 
estimates that U.S. companies have obtained $29 in new overseas 
contracts for every dollar invested in TDA activities since 
1981. In FY 1995, TDA funded 430 activities in 72 middle-income 
and developing nations.
    Under the bill, TDA's authority would be extended for two 
years, with the FY 1997 level set at $40 million and ``such 
sums as may be necessary'' for FY 1998.
    The Committee would urge TDA to give priority to small and 
medium sized companies in the allocation of its feasibility 
study grants and to develop written procedures for the 
authorization of sole source grants.

           International Trade Administration Export Programs

    The International Trade Administration's export-related 
budget primarily covers the work of the U.S. and Foreign 
Commercial Service. The Commercial Service, with a staff of 
under 1,300 in 69 countries facilitated an estimated $5.4 
billion in 1995 export sales, producing 92,000 new U.S. jobs.
    Other ITA export-related programs include the Trade 
Development office, the International Economic Policy office, 
and the Secretary's stewardship of the Trade Promotion 
Coordinating Committee (TPCC). The TPCC, which was created in 
statute by the committee in 1992, has helped bring greater 
coordination and effectiveness to export promotion. The bill 
proposes to reauthorize these activities at the current $240 
million level for FY 1997 and ``such sums as are necessary'' 
for FY 1998.
    The bill also includes two new mandatory elements to the 
TPCC's government-wide strategic plan for Federal trade 
promotion efforts, one on identifying means for more 
coordinated and comprehensive export promotion services to, and 
in behalf of, small business, and the other on establishing a 
set of priorities for promotion of U.S. exports to the Middle 
East designed to fuel job growth and to promote free market 
reforms in the region.
    The Committee is concerned that the TPCC has not fully 
succeeded in eliminating overlap and duplication in the 
operation of the government's trade-related agencies. For 
example, the 1995 TPCC Annual Report did not address the issue 
of the complete consolidation of all feasibility studies and 
funding for major overseas projects within the TDA.
    The Committee would note that the Agency for International 
Development, in particular, did not fully cooperate with 
recommendations in the 1993 and 1994 Annual Reports to transfer 
feasibility study funding to this agency.

                         III. Committee Action

    The Subcommittee on International Economic Policy and Trade 
heard testimony on export competitiveness during oversight 
hearings throughout the past year. The Subcommittee held two 
hearings specifically on the programs reauthorized in this 
bill. On February 22, 1996, testimony was heard from the 
President and CEO of OPIC, the Commerce Department's Acting 
Under Secretary for International Trade, and the Director of 
the U.S. Trade and Development Agency. Representatives of the 
exporting community testified on March 12, 1996. All witnesses 
strongly endorsed continuation of the agencies' programs.
    On June 20, 1996, the Subcommittee met in open session and 
by voice vote agreed to a Manzullo motion that the Subcommittee 
approve the draft bill and that it be introduced in the House. 
On July 9, 1996, H.R. 3759 was introduced by Representative 
Toby Roth, Chairman of the Subcommittee on International 
Economic Policy and Trade, with the following cosponsors: 
Gilman, Hamilton, Gejdenson, Meyers, Manzullo, Bereuter, 
Johnston, Martinez, and Torricelli. The bill was referred 
solely to the International Relations Committee.
    On July 10, 1996, the Committee on International Relations 
met in open session to consider H.R. 3759, agreed to an en-bloc 
Gilman amendment, and by voice vote adopted the Bereuter motion 
favorably reporting H.R. 3759, as amended, to the Committee of 
the Whole House.

          IV. Rollcall Votes and Amendments and Final Passage

    By voice vote, the Committee accepted an amendment by 
Chairman Gilman making four changes: (1) extending OPIC's 
issuing authority for an additional year for a total of five 
years; (2) adding a middle east component onto the statutory 
requirements for the Trade Promotion Coordinating Committee's 
strategic plan for U.S. trade promotion efforts; (3) requiring 
certain Trade Promotion Coordinating activities on improving 
coordination and reducing overlap and duplication in U.S. 
export promotion; and, (4) requiring the 1997 TPCC report to 
include a description of TPCC activities involving the Ukraine.
    The Bereuter motion that the bill be reported to the House 
with the recommendation that the bill, as amended, do pass, was 
accepted by voice vote.

                     V. Section-by-Section Analysis

Section 1. Title

    This section establishes the title of ``Exports, Jobs and 
Growth Act of 1996''.

            TITLE I--Overseas Private Investment Corporation

Section 101. Income levels

    This section updates for inflation the country per capita 
income levels for which OPIC gives preferential consideration 
(less developed countries) or restricts its activities (higher 
income developing countries).

Section 102. Ceiling on investment insurance

    This section raises the ceiling on OPIC's investment 
insurance issuing authority from $13.5 billion to $25 billion. 
As of September 30, 1995, the aggregate amount of outstanding 
insurance totaled $10.5 billion. OPIC's insurance authority has 
been increased to meet the growing demand for political risk 
insurance. The new ceiling of $25 billion would allow the 
Corporation to operate the investment insurance program at the 
levels expected through the term of the proposed 
reauthorization.

Section 103. Ceiling on investment guaranties

    This section raises the ceiling on OPIC's investment 
guaranty issuing authority from $9.5 billion to $20 billion. As 
of September 30, 1995, the aggregate amount of investment 
guaranties authorized or committed totaled $4.4 billion. OPIC's 
annual guaranty authority has been increased to meet the 
growing demand for OPIC guaranties. The new ceiling of $20 
billion would allow the Corporation to operate the investment 
guaranty program at the increased levels expected through the 
term of the proposed reauthorization.

Section 104. Issuing authority

    This section extends the authority of OPIC to issue 
investment insurance and guaranties for five years, until 
September 30, 2001.

Section 105. Policy guidance

    This section clarifies that OPIC's activities are to 
complement and further both the development assistance and 
trade policy objectives of the United States.

Section 106. Board of directors

    This section removes the current requirements that the 
Administrator of AID serve as Chairman of the Board and the 
U.S. Trade Representative or his deputy serve as the Vice 
Chairman of the Board. The President would now have the 
discretion to designate the persons to fill these two 
positions, choosing from among the agency officials serving on 
the Board as well as the President of OPIC.

                 title ii--trade and development agency

Section 201. Trade and Development Agency authorization

    This section extends the authorization for appropriations 
for this agency for two more years, until September 30, 1998, 
at $40 million for fiscal year 1997 and such sums as are 
necessary for fiscal year 1998.
    The Committee does not intend this language to restrict 
additional funds to be transferred to TDA or TDA from using any 
funds recouped through its reimbursement (``success fee'') 
program. In particular, the $40,000,000 does not include, nor 
preclude the anticipated $5,000,000 in transfers to the agency 
from the Freedom Support Act for activities in the NIS. Other 
transfers, it is understood, could be provided for such 
activities as the Bosnia reconstruction program and the 
transportation initiative in the South Balkans. It is also 
understood that the funds would be used to support feasibility 
studies, reverse trade missions, business workshops, technical 
assistance, training grants, and other project planning tools 
that TDA provides as strategic assistance to U.S. companies 
pursuing overseas infrastructure projects.

  title iii--export promotion programs within the international trade 
                             administration

Section 301. Export promotion authorization

    This section extends the authorization for appropriations 
to the Department of Commerce to carry out export promotion 
programs for two more years, until September 30, 1998, at $240 
million in fiscal year 1997 and such sums as necessary in 
fiscal year 1998.
    In implementing its export promotion activities, the 
Department should give clear priority to exports from the U.S., 
as opposed to exports from other countries which contain U.S. 
content or otherwise contribute to the U.S. national interest 
in some way. The Committee is concerned that foreign origin 
goods and services that are exported from facilities that have 
been relocated from the U.S. with the encouragement of foreign 
government inducements, may receive export promotion advocacy 
even where such goods and services compete with goods and 
services of U.S. origin that continue to be produced and 
exported directly from the U.S. The Committee does not view 
such situations as being consistent with the intent of 
authorizing law. Rather than providing such downstream 
advocacy, the committee is of the view that export promotion on 
behalf of foreign goods or services based upon their U.S. 
content would be better directed to the promotion of the direct 
export of such U.S. content to the relocated facility.

            title iv--trade promotion coordinating committee

Section 401. Strategic export plan

    This section adds two requirements to the Trade Promotion 
Coordinating Committee's government-wide strategic plan for 
Federal export promotion programs: first, that the TPCC 
identify means for providing more coordinated and comprehensive 
export promotion services to, and in behalf of, small- and 
medium-sized business; and second, that the TPCC establish a 
set of priorities to promote U.S. exports to, and free market 
reforms in, the Middle East designed to fuel job growth in the 
U.S. and the region.
    This provision is designed to improve the coordination of 
the existing trade promotion and investment activities of OPIC, 
TDA and the ITA in the region and to develop a comprehensive 
plan similar to the Big Emerging Market efforts undertaken 
elsewhere under TPCC direction. The TPCC's annual report to 
Congress shall describe these elements of the strategic plan 
and their implementation.
    The Committee believes that the U.S. government, through 
the TPCC, should provide more coordinated and comprehensive 
export promotion services to, and in behalf of, small- and 
medium-sized business. The TPCC should have a proactive 
outreach program for small- and medium-sized businesses, which 
could include: the creation of a small/medium business internet 
trade center with a home page with links to key sites and 
information that would provide a focal point for small 
business; regular updating of the Federal internet trade-
related database; and, development of outreach programs in each 
state to improve access to information at the local level.

Section 402. Implementation of primary objectives

    This section requires the TPCC to identify areas of overlap 
and duplication among Federal export promotion activities and 
to report on the actions taken or efforts currently underway to 
eliminate such overlap and duplication as well as report on the 
actions taken or efforts currently underway to promote better 
coordination between state, Federal, and private sector export 
promotion activities.
    Both reporting requirements closely mirror portions of 
Sections 2312 (c) and (f) of the Export Enhancement Act of 1988 
which require the TPCC to develop a strategic plan for Federal 
trade promotion efforts and to report on such plan each year no 
later than September 30th. This section is not intended to 
impose redundant requirements on the TPCC and makes clear that 
the two issues shall be addressed in the TPCC's fifth annual 
report. The Committee believes that the TPCC's third annual 
report did not sufficiently address the issues of overlap and 
duplication in Federal export promotion activities and 
coordination between state, Federal, and private sector export 
promotion activities.

Section 403. Private sector development in the Ukraine

    This section requires that the TPCC's 1997 annual report 
(its fifth) include a description of the activities of the TPCC 
departments and agencies to foster U.S. trade and investment 
which facilitates private sector development in the Ukraine. It 
is the understanding of the Committee that the TPCC's fourth 
annual report will include such an annex. The Committee wants 
to ensure that this focus is maintained, due to the importance 
of private sector development to U.S. economic and foreign 
policy interests in the Ukraine.

                    VI. Committee Oversight Findings

    In compliance with clause 2(l)(3)(A) of rule XI of the 
Rules of the House of Representatives, the Committee reports 
that the findings and recommendations of the Committee, based 
on oversight activities under clause 2(b)(1) of rule X of the 
Rules of the House of Representatives, are incorporated in the 
descriptive portions of this report.
    Among the principal oversight activities which contributed 
to the Committee's formulation of H.R. 3759 were: extensive 
hearings and briefings on the current export promotion 
programs, on the various activities of other countries on 
export promotion, on other issues pertinent to export promotion 
that are under the jurisdiction of the Committee and the 
Subcommittee on International Economic Policy and Trade; and, 
ongoing consultations between the Committee members and staff 
and executive branch officials.

       VII. Committee on Government Reform and Oversight Findings

    No findings or recommendations of the Committee on 
Government Reform and Oversight were received as referred to in 
clause 2(l)(3)(D) of rule XI of the Rules of the House of 
Representatives.

            VIII. New Budget Authority and Tax Expenditures

    The Committee adopts the cost estimate of the Congressional 
Budget Office, set out below, as its submission of any required 
information on new budget authority, new spending authority, 
new credit authority, or an increase or decrease in the 
national debt required by clause 2(l)(3)(B) or rule XI of the 
House of Representatives.

                   IX. Inflationary Impact Statement

    In compliance with clause 2(l)(4) of rule XI of the Rules 
of the House of Representatives, the Committee estimates that 
H.R. 3759 will have no significant inflationary impact on 
prices and costs in the operation of the national economy.

              X. Congressional Budget Office Cost Estimate

    In compliance with clause 2(l)(3)(C) of rule XI of the 
Rules of the House of Representatives and section 423 of Public 
Law 104-4, the Committee sets forth with respect to H.R. 3759 
the following estimates and comparison prepared by the Director 
of the Congressional Budget Office under section 403 of the 
Budget Act of 1974 and section 424 of Public Law 104-4:

                                     U.S. Congress,
                               Congressional Budget Office,
                                     Washington, DC, July 17, 1996.
Hon. Benjamin A. Gilman,
Chairman, Committee on International Relations, House of 
        Representatives, Washington, DC.
    Dear Mr. Chairman: The Congressional Budget Office has 
prepared the enclosed cost estimate for H.R. 3759, the Exports, 
Jobs, and Growth Act of 1996, as ordered reported by the House 
Committee on International Relations on July 10, 1996.
    The bill would not affect direct spending or revenues, and 
thus would not be subject to pay-as-you-go procedures under 
section 252 of the Balanced Budget and Emergency Deficit 
Control Act of 1985.
    If you wish further details on this estimate, we will be 
pleased to provide them.
            Sincerely,
                                              James L. Blum
                                   (For June E. O'Neill, Director).
    Enclosure.

               congressional budget office cost estimate

    1. Bill number: H.R. 3759.
    2. Bill title: Exports, Jobs, and Growth Act of 1996.
    3. Bill status: As ordered by the House Committee on 
International Relations on July 10, 1996.
    4. Bill purpose: The bill would extend through 2001 the 
authority of the Overseas Private Investment Corporation (OPIC) 
to enter into new commitments and would increase the statutory 
limits on OPIC's insurance and financing activities. It would 
also authorize appropriations for fiscal years 1997 and 1998 
for the Trade and Development Agency (TDA) and export programs 
of the International Trade Administration (ITA). The bill would 
impose new reporting requirements on the Trade Promotion 
Coordinating Committee.
    5. Estimated cost to the Federal Government: The additional 
costs resulting from this bill would all be subject to 
appropriations action and are summarized in the following 
table.

                                    [By fiscal years, in millions of dollars]                                   
----------------------------------------------------------------------------------------------------------------
                                                           1996    1997    1998    1999    2000    2001    2002 
----------------------------------------------------------------------------------------------------------------
                                    SPENDING SUBJECT TO APPROPRIATIONS ACTION                                   
                                                                                                                
Proposed Changes:                                                                                               
    Estimated authorization level.......................       0     405     397     110     127     117     -44
    Estimated outlays...................................       0     178     269     166     122      95      92
----------------------------------------------------------------------------------------------------------------

    The costs of the bill fall in budget functions 150 
(International Affairs) and 370 (Commerce and Housing Credit).
    6. Basis of estimate: The estimate assumes enactment of the 
bill by September 30, 1996, and appropriation of the authorized 
amounts. CBO used historical spending rates for estimating 
outlays.
    OPIC insures investments against loss due to expropriation, 
currency inconvertibility, and political violence. It also 
finances investments through guarantees and direct loans. OPIC 
has permanent, indefinite authorization to administer current 
commitments for insurance and financing. Title I would extend 
through 2001 OPIC's authority for new commitments, which 
expires on September 30, 1996. The bill would also roughly 
double the statutory ceilings on OPIC's insurance activity 
(from $13.5 billion to $25.0 billion) and financing programs 
(from $9.5 billion to $20.0 billion).
    For 1997-2001, the net budgetary impact of Title I is to 
increase costs by about $120 million a year over current law. 
The costs have three parts--the subsidy cost of new financing 
commitments, the offsetting collections from the insurance 
program, and the cost of administering the expanded programs. 
CBO's estimates of these costs are as follows:
    CBO anticipates annual new financing commitments of $2.5 
billion each year over the 1997-1999 period. Using a subsidy 
rate of 5 percent, CBO estimates an authorization of subsidy 
appropriations of $125 million each year. Similarly, at 
anticipated commitments of $3 billion each year over the 2000-
2001 period, CBO estimates an authorization of subsidy 
appropriations of $150 million each year.
    CBO estimates that net income from the insurance program 
would increase by $3 million in 1997 and by more than $220 
million over the 1997-2002 period.
    Doubling OPIC's insurance and financing activity would also 
increase administrative expenses. CBO estimates administrative 
expenses would increase by $3 million in 1997 and by $100 
million over the 1997-2002 period.
    The following table summarizes the budgetary impact of 
Title I.

                                    [By fiscal years, in millions of dollars]                                   
----------------------------------------------------------------------------------------------------------------
                                                     1996     1997     1998     1999     2000     2001     2002 
----------------------------------------------------------------------------------------------------------------
                                    SPENDING SUBJECT TO APPROPRIATIONS ACTION                                   
                                                                                                                
Spending Under Current Law:                                                                                     
    Estimated authorization level \1\ \2\........      -97     -191     -190     -190     -191     -191     -191
    Estimated outlays............................     -111     -128     -140     -172     -188     -190     -191
Proposed Changes:                                                                                               
    Estimated authorization level................        0      125      117      110      127      117      -44
    Estimated outlays............................        0        0       27       71       88       90       90
Spending Under the Bill:                                                                                        
    Estimated authorization level \1\............      -97      -66      -73      -80      -64      -74     -235
    Estimated outlays............................     -111     -128     -112     -101     -100     -100     -101
----------------------------------------------------------------------------------------------------------------
\1\ The 1996 figure is the amount already appropriated.                                                         
\2\ Amounts for fiscal years 1997 through 2001 are permanent, indefinite authorizations subject to              
  appropriations action and net of offsetting collections.                                                      

    The bill would authorize $40 million for TDA and $240 
million for ITA's export programs in 1997 and such sums as may 
be necessary for both agencies for 1998. This estimate assumes 
a 1998 appropriation equal to the 1997 authorization. (If 
funding were adjusted for inflation, the authorized amounts 
would grow to $41 million for TDA and $247 million for ITA's 
export programs in 1998.) CBO estimates no significant 
budgetary impact from the additional reporting requirements 
imposed upon the Trade Promotion Coordinating Committee. The 
following table summarizes the budgetary impact of these 
provisions.

                                    [By fiscal years, in millions of dollars]                                   
----------------------------------------------------------------------------------------------------------------
                                                           1996    1997    1998    1999    2000    2001    2002 
----------------------------------------------------------------------------------------------------------------
                                    SPENDING SUBJECT TO APPROPRIATIONS ACTION                                   
                                                                                                                
Spending Under Current Law:                                                                                     
    Estimated authorization level \1\...................     285       0       0       0       0       0       0
    Estimated outlays...................................     265     109      41       8       3       1       0
Proposed Changes:                                                                                               
    Estimated authorization level.......................       0     280     280       0       0       0       0
    Estimated outlays...................................       0     178     242      95      34       5       2
Spending Under the Bill:                                                                                        
    Estimated authorization level \1\...................     285     280     280       0       0       0       0
    Estimated outlays...................................     265     287     283     103      37       6      2 
----------------------------------------------------------------------------------------------------------------
\1\ The 1996 figure is the amount already appropriated.                                                         

    7. Pay-as-you-go considerations: None.
    8. Estimated impact on State, local, and tribal 
governments: CBO estimates that H.R. 3759 contains no 
intergovernmental mandates as defined by Public Law 104-4 and 
would have no impact on the budgets of state, local, or tribal 
governments.
    9. Estimated impact on the private sector: CBO estimates 
that this bill would impose no private-sector mandates as 
defined by Public Law 104-4.
    10. Previous CBO estimate: None.
    11. Estimated prepared by: Federal cost estimate: Sunita 
D'Monte and Rachel Forward. Impact on State, local, and tribal 
governments: Pepper Santalucia. Impact on the Private Sector: 
Amy Downs.
    12. Estimate approved by: Paul N. Van de Water, Assistant 
Director for Budget Analysis.

                       XI. Jurisdictional Issues

    H.R. 3759, as reported by the Committee on International 
Relations, does not contain provisions which fall within the 
shared jurisdiction of other committees of the House.

       XII. Changes in Existing Law Made by the Bill, as Reported

  In compliance with clause 3 of rule XIII of the Rules of the 
House of Representatives, changes in existing law made by the 
bill, as reported, are shown as follows (existing law proposed 
to be omitted is enclosed in black brackets, new matter is 
printed in italic, existing law in which no change is proposed 
is shown in roman):

                     FOREIGN ASSISTANCE ACT OF 1961

                                 PART I

          * * * * * * *

                       Chapter 2--Other Programs

          * * * * * * *

           Title IV--Overseas Private Investment Corporation

  Sec. 231. Creation, Purpose and Policy.--[To mobilize] To 
increase United States exports to, and to mobilize and 
facilitate the participation of United States private capital 
and skills in the economic and social development [of less 
developed] of, less developed countries and areas, and 
countries in transition from nonmarket to market economies, 
thereby complementing the trade policy and development 
assistance objectives of the United States, there is hereby 
created the Overseas Private Investment Corporation 
(hereinafter called the ``Corporation''), which shall be an 
agency of the United States under the policy guidance of the 
Secretary of State.
  The Corporation, in determining whether to provide insurance, 
financing, or reinsurance for a project, shall especially--
          (1) be guided by the economic and social development 
        impact and benefits of such a project and the ways in 
        which such a project complements, or is compatible 
        with, other development assistance programs or projects 
        of the United States or other donors;
          (2) give preferential consideration to investment 
        projects in less developed countries that have per 
        capita incomes of [$984 or less in 1986 United States 
        dollars] $1,280 or less in 1994 United States dollars, 
        and restrict its activities with respect to investment 
        projects in less developed countries that have per 
        capita incomes of [$4,269 or more in 1986 United States 
        dollars] $5,556 or more in 1994 United States dollars 
        (other than countries designated as beneficiary 
        countries under section 212 of the Caribbean Basin 
        Economic Recovery Act (19 U.S.C. 2702), Ireland, and 
        Northern Ireland); and
          * * * * * * *
  Sec. 233. Organization and Management.--(a) Structure of the 
Corporation.--The Corporation shall have a Board of Directors, 
a President, an Executive Vice President, and such other 
officers and staff as the Board of Directors may determine.
  (b) Board of Directors.--All powers of the Corporation shall 
vest in and be exercised by or under the authority of its Board 
of Directors (``the Board'') which shall consist of fifteen 
Directors, including the Chairman, with eight Directors  
constituting a quorum for the transaction of business. [The 
Administrator of the Agency for International Development shall 
be the Chairman of the Board, ex officio. The United States 
Trade Representative shall be the Vice Chairman of the Board, 
ex officio, except that the United States Trade Representative 
may designate the Deputy United States Trade Representative to 
serve as Vice Chairman of the Board in place of the United 
States Trade Representative.] Eight Directors  [(other than the 
President of the Corporation, appointed pursuant to subsection 
(c) who shall serve as a Director, ex officio)]  shall be 
appointed by the President of the United States, by and with 
the advice and consent of the Senate, and shall not be 
officials or employees of the Government of the United States. 
At least two of the eight Directors  appointed under the 
preceding sentence shall be experienced in small business, one 
in organized labor, and one in cooperatives. Each such Director 
shall be appointed for a term of no more than three years. The 
terms of no more than three such Directors  shall expire in any 
one year. Such Directors shall serve until their successors are 
appointed and qualified and may be reappointed.
  The other Directors shall be officials of the Government of 
the United States, including the President of the Corporation, 
the Administrator of the Agency for International Development, 
the United States Trade Representative, and an official of the 
Department of Labor, designated by and serving at the pleasure 
of the President of the United States. The United States Trade 
Representative may designate a Deputy United States Trade 
Representative to serve on the Board in place of the United 
States Trade Representative.
  There shall be Chairman and a Vice Chairman of the Board, 
both of whom shall be designated by the President of the United 
States from among the Directors of the Board other than those 
appointed under the second sentence of the first paragraph of 
this subsection.
  All Directors who are not officers of the Corporation or 
officials of the Government of the United States shall be 
compensated at a rate equivalent to that of level IV of the 
Executive Schedule (5 U.S.C. 5315)  when actually engaged in 
the business of the Corporation and may be paid per diem in 
lieu of subsistence at the applicable rate prescribed in the 
standardized Government travel regulations, as amended, from 
time to time, while away from their homes or usual places of 
business.
          * * * * * * *
  Sec. 235. Issuing Authority, Direct Investment Authority and 
Reserves.--
  (a)  Issuing Authority.--
          (1) Insurance.--The maximum contingent liability 
        outstanding at any one time pursuant to insurance 
        issued under section 234(a) shall not exceed in the 
        aggregate [$13,500,000,000] $25,000,000,000.
          (2) Financing.--(A) The maximum contingent liability 
        outstanding at any one time pursuant to financing 
        issued under subsections (b) and (c) of section 234 
        shall not exceed in the aggregate [$9,500,000,000] 
        $20,000,000,000.
          (B) Subject to spending authority provided in 
        appropriations Acts pursuant to section 504(b) of the 
        Federal Credit Reform Act of 1990, the Corporation is 
        authorized to transfer such sums as are necessary from 
        its noncredit activities to pay for the subsidy cost of 
        the investment guaranties and direct loan programs 
        under subsections (b) and (c) of section 234.
          (3) Termination of authority.--The authority of 
        subsections (a) and (b) of section 234 shall continue 
        until September 30, [1996] 2001.
          * * * * * * *

                                PART III

          * * * * * * *

                  Chapter 3--Miscellaneous Provisions

          * * * * * * *

SEC. 661. TRADE AND DEVELOPMENT AGENCY.

  (a) * * *
          * * * * * * *
  (f) Funding.--
          [(1) Authorization.--(A) There are authorized to be 
        appropriated for purposes of this section, in addition 
        to funds otherwise available for such purposes, 
        $77,000,000 for fiscal year 1995 and such sums as are 
        necessary for fiscal year 1996.]
          (1) Authorization.--(A) There are authorized to be 
        appropriated for purposes of this section, in addition 
        to funds otherwise available for such purposes, 
        $40,000,000 for fiscal 1997, and such sums as are 
        necessary for fiscal year 1998.
          * * * * * * *
                              ----------                              


    SECTION 202 OF THE EXPORT ADMINISTRATION AMENDMENTS ACT OF 1985

[SEC. 202. AUTHORIZATION OF APPROPRIATIONS.

  [There are authorized to be appropriated to the Department of 
Commerce to carry out export promotion programs such sums as 
are necessary for fiscal years 1995 and 1996.]

SEC. 202. AUTHORIZATION OF APPROPRIATIONS.

  There are authorized to be appropriated to the Department of 
Commerce to carry out export promotion programs $240,000,000 
for fiscal year 1997 and such sums as are necessary for fiscal 
year 1998.
                              ----------                              


           SECTION 2312 OF THE EXPORT ENHANCEMENT ACT OF 1988

SEC. 2312. TRADE PROMOTION COORDINATING COMMITTEE.

  (a) * * *
          * * * * * * *
  (c) Strategic Plan.--To carry out subsection (b), the TPCC 
shall develop and implement a governmentwide strategic plan for 
Federal trade promotion efforts. Such plan shall--
          (1) * * *
          * * * * * * *
          (4) propose to the President an annual unified 
        Federal trade promotion budget that supports the plan 
        for priority activities and improved coordination 
        established under paragraph (2) and eliminates funding 
        for the areas of overlap and duplication identified 
        under paragraph (3); [and]
          (5) review efforts by the States (as defined in 
        section 2301(i)) to promote United States exports and 
        propose means of developing cooperation between State 
        and Federal efforts, including co-location, cost-
        sharing between Federal and State export promotion 
        programs, and sharing of market research data[.];
          (6) identify means for providing more coordinated and 
        comprehensive export promotion services to, and in 
        behalf of, small and medium-sized businesses; and
          (7) establish a set of priorities to promote United 
        States exports to, and free market reforms in, the 
        Middle East that are designed to stimulate job growth 
        both in the United States and the region.
          * * * * * * *