Erie County's development agency is a Little Leaguer playing in the majors when it comes to hitting home runs in export financing.
The Erie County Industrial Development Agency was the U.S. Export-Import Bank's third-largest mover of trade loans in fiscal 1997, surpassing many larger organizations, according to the federal agency.
Only Michigan and Pennsylvania bested the IDA's loan volume of $6.2 million among the Eximbank's 38 partner organizations, many of which -- like the two leaders -- are state development agencies. Sales of trade insurance policies brought the IDA's total of trade financing to $7.1 million.
"They (ECIDA) are very active," said Augustine A. Grace, coordinator of the Eximbank City-States program.
The county development agency will also rank among the top five lenders for fiscal 1998 ended Oct. 1, although final numbers are incomplete, he said.
The Washington, D.C.-based Eximbank provides financing for export business in the form of loan guarantees and payment insurance. Banks, reluctant to see their collateral leave the country, frequently balk at underwriting exports.
Eximbank programs are designed to generate export sales -- and by extension, jobs -- that would otherwise be missed for lack of financing.
Under the City-States program, county and state development agencies recruit exporters and process their Eximbank loan applications. The ECIDA became a City-States partner in 1995, generating just one deal for $300,000 that year.
The export financing program underlines a regional push toward growing the export economy, especially now that global markets are in turmoil, said Ed Arnold, ECIDA director of International Programs.
"With the Asian crisis, we're seeing companies that had been selling on an open account becoming a little more cautious," he said.
While loan guarantees assure a bank that it will be repaid, payment insurance assures a business that it won't be put out of business if a foreign customer defaults.
For instance, a $150,000 loan guarantee helped Applied Fabric Technologies Inc. in Orchard Park complete a $300,000 sale to the Turkish Navy, president Peter Lane said.
"We had most of our regular line of credit tied up in another project, so we took it up with the IDA," Lane said. The Orchard Park company is supplying Turkey with spill barriers as the nation prepares to take environmental responsibility for the increasing volume of shipments through the Bosporus Strait.
"I'm not really hot on all the taxes we pay here in New York," Lane said. "(So) it's nice to get some of it back in the form of very responsive service."
The ECIDA expects to double its sales of trade insurance this year and will likely vault the amount to $70 million next year as a result of new deals.
The agency became a full-fledged Eximbank lender in 1997, with the authority to approve financing deals.