[Congressional Record Volume 147, Number 178 (Thursday, December 20, 2001)]
[Senate]
[Pages S13972-S13973]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. WELLSTONE (for himself, Mr. DeWine; Mr. Dayton, Mr. 
        Specter, Mr. Bayh, Ms. Mikulski, and Mr. Voinovich):
  S. 1884. A bill to amend the Emergency Steel Loan Guarantee Act of 
1999 to revise eligibility and other requirements for loan guarantees 
under that Act, and for other purposes; to the Committee on 
Appropriations.
  Mr. WELLSTONE. Mr. President, today I introduce, on behalf of myself 
and Senators DeWine, Dayton, Specter, Mukulski and Bayh the ``Emergency 
Steel Loan Guarantee Amendments of 2001.'' These amendments to the 
Steel Loan Guarantee Act of 1999 are designed to make the loan 
guarantee program more accessible to companies in urgent need of 
assistance as they attempt to recover from the devastating impacts of 
enormous, unfair import surges, as well as the effects of the current 
recession.
  A strong domestic steel industry is essential to our national 
security. To ensure the continuing viability of this critical industry 
and to deal with the current crisis, we must act quickly, and we must 
act comprehensively.
  First, the Administration must provide immediate and decisive strong 
relief in the pending Section 201 steel import surge investigation. 
That relief needs to include substantial tariffs as well as quotas.
  Second, we need a formula for industry-wide sharing of the huge 
retiree health-care cost burdens resulting from the massive layoffs 
during the 1970's and 1980's. We must protect retirees health care 
needs without undermining the ability of companies attempting to 
compete in an increasingly challenging marketplace. Several colleagues 
and I have previously introduced legislation to accomplish this, and we 
have urged the Administration to support us in this effort as past of a 
comprehensive solution to the steel crisis we face today.
  Finally, companies urgently need access to capital to sustain their 
operations. This is precisely what the Emergency Steel Loan Guarantee 
Act of 1999 was designed to insure. The tireless efforts and foresight 
of Senator Byrd led to the creation of the Emergency Steel Loan 
Guarantee Board in 1999, but since then massive import surges, the 
current economic downturn and apparently overly-restrictive 
interpretations of the Board's authority have made it all but 
impossible for struggling steel firms to meet the Board's eligibility 
criteria.
  The bill we introduce today is designed to address these concerns. It 
provides the Board with the necessary flexibility to provide these 
essential loan guarantees. In particular, the bill would do the 
following: 1. Clarify that a company that has placed its facilities on 
``hot idle status'' is eligible to receive a loan guarantee. 2. 
Increase the amount of loans guaranteed with respect to a single 
qualified steel company to $350,000,000. 3. Permit the Steel Loan 
Guarantee Board to guarantee a loan where there is a fair likelihood of 
repayment, assuming vigorous and timely enforcement of our trade laws 
and general economic prosperity. 4. Provide flexibility to the Board in 
structuring security arrangements to maximize participation of lenders. 
5. Expand the scope of lenders permitted to participate in a loan 
subject to the guarantee to include public and private institutions, 
including the company's existing lenders. 6. Require the Board to adopt 
form of guarantee regulations no less favorable than those used in 
other government programs, including the Export-Import bank. 7. Include 
as a requirement for loan guarantees that the company's business plan 
maximize both retention of jobs and capacity consistent with the long-
term economic viability of the company. 8. Increase the loan guarantee 
level for all loans to 95 percent.
  The recent economic conditions facing the U.s. iron ore and steel 
industry are of particular concern in Minnesota. We are extremely proud 
of our State's history as the Nation's largest producer of iron ore. 
The taconite mines on the Iron Range in Minnesota and in our sister 
State of Michigan have provided key raw materials to the Nation's steel 
producers for over a century.

[[Page S13973]]

  You will not find a harder-working, more committed group of workers 
anywhere in this country than you find in the iron ore and taconite 
industry. This is a group of people who work under the toughest of 
conditions, are absolutely committed to their families, and who now 
face dire circumstances, through no fault of their own. Unfairly traded 
iron ore, semi-finished steel and finished steel products are taking 
their jobs.
  Earlier this year, LTV Steel Mining Company halted production at its 
Hoyt Lakes, MN mine, leaving 1,400 workers out of good paying jobs and 
affecting nearly 5,000 additional workers. We need to act and we need 
to act now. Workers in the steel, iron ore and taconite industries want 
nothing more than the chance to do their jobs. The bill we introduce 
today is one part of the answer. I urge my colleagues to join with me 
in moving this legislation as quickly as possible.
  Mr. DeWINE. Mr. President, I rise today with my colleague and friend 
from Minnesota, Senator Wellstone, to introduce the Emergency Steel 
Loan Guarantee Amendments Act. This legislation would improve the 
Emergency Steel Loan Guarantee program.
  Our steel industry is on the brink of financial collapse because of 
unfair and illegal trade practices. To date, some 25 U.S. steel 
companies, including LTV Steel in Cleveland, Ohio, have filed 
bankruptcy. These companies employ thousands of workers and are 
responsible for providing benefits to their retirees. If our steel 
industry goes under, the consequences to our nation, and particularly 
Ohio, would be grave. Steel is vitally important to our military and 
economic security. During times of crisis, the industry has been a 
source of strength for America. With our economy sputtering and our 
nation fighting a new war on terrorism, we need a healthy steel 
industry now more than ever.
  In 1998, more than 41 million tons of steel found their way to U.S. 
markets. This was an 83 percent increase over the 23 million net ton 
average for the previous eight years. While in 1999 some claimed that 
the steel import crisis was over, they were soon reminded how volatile 
the situation really is. In 2000, 37.8 million tons of steel flooded 
U.S. markets. This was almost as high as the record 1998 import levels.
  For almost 50 years, foreign steel producers have received direct and 
often illegal assistance from their governments in the form of 
subsidies or market intervention. This has contributed to a worldwide 
over production of steel. In 1999, the Organization for Economic 
Cooperation and Development, OECD, found that world steel making 
capacity remained ``well-above'' production between 1985 and 1999. Much 
of this excess steel has been shipped to the United States and priced 
well below U.S. steel. In some cases, these imports were dumped, 
subsidized, and shipped in such increased quantities as to inflict 
serious financial harm to U.S. producers.
  As a key supporter of the Emergency Steel Loan Guarantee program, I 
believe that we must modify the program to make it work better. It is 
true that we have changed it this year; extending its life and 
increasing the portion of the loan covered by the guarantee from 85 
percent to in some cases 95 percent. However, we need to do more. The 
Wellstone/DeWine legislation would clarify that a company, such as LTV, 
which has placed its facilities on ``hot idle status'' is eligible to 
receive a loan guarantee. It would also increase the amount of loans 
guaranteed with respect to a single qualified steel company to 
$350,000,000; permit the Steel Loan Guarantee Board to guarantee a loan 
where there is a fair likelihood of repayment, assuming vigorous and 
timely enforcement of our trade laws and general economic prosperity; 
provide flexibility to the Board in structuring security arrangements 
to maximize participation of lenders; expand the scope of lenders 
permitted to participate in a loan subject to the guarantee to include 
public and private institutions, including the company's existing 
lenders; require the Board to adopt a form of guarantee regulations no 
less favorable than those used in other government programs, including 
the Export-Import bank, and; increase the loan guarantee level for all 
loans to 95 percent.
  We in the steel community are grateful for the President's leadership 
in initiating the Section 201 trade investigation, and we were 
generally pleased with the International Trade Commission's 
recommendations. I was pleased to see the Customs Service proceeding in 
a timely manner with the release of dumping and subsidy offset payments 
to the victims of illegal trade practices, including LTV, under the 
Continued Dumping and Subsidy Offset Act. However, without these 
changes to the Emergency Steel Loan program, many of our steel 
companies will not survive. We have an opportunity to send a powerful 
message to the world that America is standing by our steel industry in 
its time of need just as the industry has stood by America in her time 
of need.
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