The legislation would allow states to purchase up to 49.9 percent of a loan from a commercial bank and then defer interest and principal payments for up to three years, lowering the payments for manufacturers. States could also provide up to 49.9 percent of the collateral needed for loans. As the loans are repaid, the money would be returned to the treasury.
The bill's introduction, which took place on Feb. 22, was lead by Reps. Sander Levin (D-Mich.), John Dingell (D-Mich.), and Gary Peters (D-Mich.). It was co-sponsored by Reps. Barney Frank (D-Mass.), Dennis Moore (D-Kan.), Paul Kanjorski (D-Pa.), Charles Rangel (D-N.Y.), Marcia Fudge (D-Ohio), Dale Kildee (D-Mich.), Bill Pascrell (D-N.J.), Daniel Lipinski (D-Ill.), Michael Doyle (D-Pa.), Allyson Schwartz (D-Pa.), G.K. Butterfield (D-N.C.), Bob Etheridge (D-N.C.), and Tim Ryan (D-Ohio.).
"This is the right bill at the right time for motor vehicle parts suppliers, and all manufacturing industries," said Bob McKenna, MEMA's president and CEO. "For the last year and a half, our members have struggled with the downturn in the economy, historic low vehicle production, and an inability to access credit. Passage of this bill would be a significant step in improving access to capital which is critical for our members to remain in business."