GAO

United States General Accounting Office

Report to the Honorable

Gordon Smith, U.S. Senate

June 1999 EXPORT 

PROMOTION

U.S. Export Assistance 

Centers Seek to 

Improve Services

GAO/NSIAD-99-180

Page 1 GAO/NSIAD-99-180 Export Assistance Centers

United States General Accounting Office

Washington, D.C. 20548

National Security and

International Affairs Division

B-283863 Letter

June 25, 1999

The Honorable Gordon H. Smith

United States Senate

Dear Senator Smith: 

The interagency Trade Promotion Coordinating Committee (TPCC) was 

created in statute by the Export Enhancement Act of 19921

 to, among other 

things, coordinate the delivery of federal export promotion services.2

 To 

carry out Congress’ intent, three TPCC agencies—the Department of 

Commerce, the U.S. Export-Import Bank (Eximbank), and the Small 

Business Administration (SBA)—established a domestic network of 19 

“one-stop shops,” called U.S. Export Assistance Centers (USEAC). The 

agencies participating in this network were to coordinate among 

themselves as well as with nonfederal organizations, such as state agencies 

and world trade centers. Their goal was to deliver a full range of 

nonagricultural export education, promotion, and finance services to smallto medium-sized exporters and firms interested in becoming exporters.3

At your request, we examined activities of the USEAC network. 

Specifically, we identified (1) the nature of coordination among the federal 

agencies participating in the USEAC network and between these agencies 

and nonfederal export-service providers and (2) USEAC assistance to firms 

that export services and to firms that are not ready to export but show 

potential and interest in doing so.

In conducting this review, we interviewed officials and obtained pertinent 

documents at Commerce, SBA, and Eximbank headquarters and several 

trade associations. We visited the USEACs in Atlanta, Ga.; Baltimore, Md.; 

New York, N.Y.; Portland, Oreg.; San Jose, Calif.; and Seattle, Wash., where 

1

Public Law 102-429, October 21, 1992.

2

Before 1992, U.S. firms seeking assistance in selling or financing exports faced a fragmented structure 

of federal agencies and programs. See our March 15, 1993, testimony, Export Promotion: 

Governmentwide Strategy Needed for Federal Programs (GAO/T-GGD-93-7); our August 10, 1992, 

testimony, Export Promotion: Federal Approach Is Fragmented (GAO/T-GGD-92-68); and our January 

10, 1992, report, Export Promotion: Federal Programs Lack Organizational and Funding Cohesiveness

(GAO/NSIAD-92-49). 

3

The TPCC has defined small- to medium-sized firms as those with fewer than 500 employees.

Letr
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we also interviewed other export-service providers and clients. For the 

other 13 USEACs, we interviewed their directors by telephone. We also 

analyzed 6,009 “export actions,”4

 valued at approximately $4.2 billion, to 

assess USEAC efforts to coordinate with federal and nonfederal partners 

and assist firms that export services. These export actions were reported 

to Commerce by trade specialists at the USEACs for fiscal year 1998. (See 

app. IV for additional information on our objectives, scope, and 

methodology.)

Results in Brief The U.S. Export Assistance Centers have sought to promote coordination 

among participating agencies through such activities as making joint calls 

on prospective clients and sharing information on clients and services, 

where appropriate. For fiscal year 1998, nearly 20 percent of the “export 

actions” reported by USEAC trade specialists mentioned a partner (or 

partners) as having participated in assisting the client. Currently, 5 of the 

19 USEACs have staff from all three agencies, and 14 sites have staff from 

Commerce and SBA. In fiscal year 1998, the Commerce staff began using a 

new Client Management System (CMS) to track clients that has the 

potential to further enhance information sharing among these partner 

agencies. Access to this system, which contains detailed information on 

Commerce’s clients, could potentially permit agencies to better target 

services to client needs. The USEACs have also pursued partnerships with 

nonfederal export-service providers--state and local government, nonprofit, 

and for-profit organizations that provide assistance to exporters. The 

USEACs have co-located their staff in the same office suite or building with 

these export-service providers or, otherwise, made arrangements to 

coordinate their export assistance. 

In response to an October 1994 TPCC initiative, Commerce has sought 

through the USEACs to expand its assistance to firms that export services. 

The agency created an inter-USEAC Services Team, comprised of staff from 

USEACs and foreign posts, to devise means to do so. The team found that 

Commerce’s export promotion programs were largely designed for firms 

4

Commerce has been using export actions as a measure of USEAC activity for approximately 3 years. 

Trade specialists submit export action reports when they believe their assistance has directly 

contributed to a firm’s export sale of at least $1,000. These export actions are used as an indicator of 

the nature of the assistance provided by the USEACs. They are not a precise measure of this activity, 

however, since not all firms are willing to share the necessary information regarding their export sales. 

Further, Commerce’s current system for collecting export actions is less than a year old, and some 

USEACs might not yet be able to take full advantage of all its features. 

Letr
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that export goods and are often unavailable or inappropriate for firms that 

export services. As part of this effort, selected USEACs have taken the 

initiative to use other approaches. For example, one USEAC helped to 

stage a series of international videoconferences through which U.S. 

architects could gain market intelligence and meet potential clients. 

USEACs are also seeking to help groups of service exporters in the design 

and education sectors to form consortiums through which they can jointly 

pursue export business. 

The TPCC has affirmed the central role of the USEAC network in assisting 

small- and medium-sized enterprises. Many such firms, however, are not 

yet ready to export. Since assisting them can be time consuming, USEACs 

generally refer them to nonfederal partner organizations that specialize in 

helping such firms. But no formal mechanism existed for USEAC staff to 

follow up with firms that had been referred to nonfederal partners. Some 

USEACs are beginning to use a special program developed by SBA, which 

is tailored to the particular needs of such firms. Using this partnership 

program, USEACs can organize federal and nonfederal export-service 

providers into consortiums that provide firms that are not ready to export 

with comprehensive export training. USEACs then offer intensive 

follow-up counseling to those firms that successfully complete the 

program. Firms participating in this program have become customers for 

USEAC export promotion and finance services and, ultimately, exporters.

Background The Export Enhancement Act of 1992 authorized the TPCC to establish a 

national export strategy for the federal government and to update Congress 

annually on implementation of and revisions to that strategy. In the context 

of this overall strategy, the act instructed the Commerce Department to use 

its domestic network of district offices as “one-stop shops” to provide 

exporters with information on all export promotion and export finance 

activities of the federal government. Rather than simply require Commerce 

to ensure that its district offices had the requisite information, the TPCC’s 

national export strategy recommended that Commerce and two other 

TPCC agencies--SBA and the Eximbank--join their separate nationwide 

networks of service-delivery offices into one federal export promotion 

network of USEACs. This network would co-locate staff from all three 

agencies. 
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These agencies opened 4 pilot USEACs in January 1994 and have expanded 

the network to 19 USEACs and 84 satellite offices nationwide.5

 The 

satellite offices, which generally have one or two Commerce staff 

members, are placed closer to outlying business centers where USEAC 

clients are often located. (See app. II for a more detailed presentation of 

the USEAC network.) At the USEACs, Commerce provides export 

promotion services largely to export-ready small- to medium-sized firms, 

both directly and with the assistance of District Export Councils, which are 

comprised of local business representatives who share advice and 

expertise with firms interested in exporting. SBA provides export finance 

primarily in the form of export working capital guarantees. It also provides 

export education services, largely through two quasi-governmental 

programs, to small firms that are not ready to export. The Eximbank offers 

a broad range of export financing to exporters. SBA and the Eximbank 

have worked to harmonize6

 their export working capital programs, the only 

type of finance where the potential for competition exists. (See app. I for 

information on the legislative authority for these agencies’ export programs 

and the types of services offered.)

USEACs market their services in various ways--directly to exporters 

through presentations at export conferences and seminars; by distributing 

literature, such as brochures or packets of information on their services; 

and through sites on the Internet’s worldwide web. They also market 

indirectly through formal relationships with organizations, such as the 

banks that work with SBA and the Eximbank; and informal relationships 

with numerous state and local nonprofit and private organizations that 

represent USEAC services to their clients. 

5

Other federal agencies have limited representation at USEACs. The U.S. Department of Agriculture’s 

Foreign Agricultural Service has staff representation at the Atlanta, Ga., USEAC. The Agency for 

International Development has staff representation at the Inland Empire, Calif., satellite office of the 

Long Beach, Calif., USEAC. Commerce’s Economic Development Administration has staff at the 

Portland, Oreg., USEAC. 

6

The agencies agreed to a market segmentation plan that assigned SBA primary responsibility for 

assisting small businesses whose export working capital needs do not exceed a $750,000 exposure limit 

and made the Eximbank responsible for assisting exporters with greater export working capital needs. 

See our February 13, 1997, report, Export Finance: Federal Efforts to Support Working Capital Needs of 

Small Business (GAO/NSIAD-97-20).
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USEACs Coordinate 

With Other Service 

Providers in Various 

Ways

USEAC partners have used coordination as a mechanism for delivering a 

wide range of export services to clients. Partnerships are encouraged 

through joint efforts with other federal agencies and nonfederal 

export-service providers, and co-location of staff.

Export Actions Reflect 

USEAC Cooperative Efforts

For fiscal year 1998, nearly 20 percent of the “export actions” reported by 

trade specialists at the USEACs through the CMS mentioned a partner as 

having participated in assisting the client. Many individual export actions 

mentioned more than one partner. Over 6.7 percent of the export actions 

involved assistance by another federal agency. These actions mentioned 

SBA and the Eximbank, as well as the Agency for International 

Development, the U.S. Department of Agriculture’s Foreign Agricultural 

Service, and the Trade Development Agency. Over 14 percent of the export 

actions for fiscal year 1998 mentioned nonfederal partners as having also 

contributed to the export. These included a wide variety of state, local, 

quasi-governmental, and nonprofit organizations, such as the Georgia 

Department of Industry, Trade, and Tourism; the city of Santa Clara, Calif.; 

BAYTRADE, a quasi-governmental organization that promotes exports in 

the San Francisco Bay area; and the Maine International Trade Center.

Cooperation Among USEAC 

Agencies

Since the creation of the USEAC network, participating agencies have 

introduced various measures to promote coordination at the USEACs. For 

instance, they have encouraged USEAC staff to make “joint counseling” 

calls on clients. On such a call, staff from more than one USEAC agency 

would make a joint presentation to a client. When joint calling might not be 

appropriate, USEAC staff routinely refer clients to each other. In addition, 

USEAC staff also share information on clients, when appropriate. 

Commerce has also introduced its Client Management System to the 

USEAC network. CMS may have the potential to serve as the basis for a 

USEAC-wide client tracking system that could be shared by all 

participating agencies. Access to a common database on clients could help 

participating agencies to better target their services to client needs. As a 

result of Commerce’s efforts, SBA has decided to use Commerce’s CMS as 

its client tracking system. SBA is currently working with Commerce to 

adapt the CMS to meet its needs and train its USEAC staff on the use of the 

system. Moreover, the Eximbank is considering introducing a client 

tracking that would be compatible with Commerce’s CMS.
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Cooperation Between 

USEACs and Nonfederal 

Partners

All USEACs coordinate at least some of their export service activities with 

nonfederal export-service providers. This coordination ranges from joint 

participation in specific activities to co-location of staff and integration of 

operations. For example, several staff members of the Seattle, Wash., 

USEAC made presentations at a trade seminar sponsored by the World 

Trade Center of Tacoma, Wash., to firms interested in exporting. USEACs 

and nonfederal partners also refer clients to each other. At the New York, 

N.Y., USEAC, for example, USEAC staff have told clients to seek assistance 

at Brooklyn Goes Global, a not-for-profit organization associated with the 

local Chamber of Commerce that promotes the export of goods and 

services from Brooklyn. In addition, USEACs may enter into formal 

memorandums of understanding with nonfederal export-service providers 

or participate in a partner’s board of directors.

Some USEACs are co-located in the same building or office suite with 

nonfederal export-service providers. For example, the Portland, Oreg., 

USEAC is located in the World Trade Center with several state export 

promotion agencies and a nonprofit export-service organization. In 

addition, the Atlanta, Ga., USEAC has integrated its operations with the 

Georgia Department of Industry, Trade, and Tourism. At this USEAC, staff 

roles have been allocated so as to avoid duplication, and staff from both 

agencies have access to each other’s client tracking systems. According to 

the Atlanta USEAC Director, this arrangement has permitted the 

participating federal agencies to leverage their staff and extend their reach 

into the export community.

According to Commerce officials, about 75 percent of all USEACs and 

satellite offices are co-located with nonfederal partners, such as state 

agencies and world trade centers. As one of its National Performance 

Review7

 goals, Commerce pledged to increase that percentage to 100 

percent by the end of fiscal year 1999.

7

The National Performance Review is a major management reform initiative by the executive branch 

that is intended to identify ways to make the government work better and cost less.
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USEACs Seek to 

Improve Assistance to 

Firms That Export 

Services

The TPCC first made a commitment to helping exporters of services in its 

1994 National Export Strategy and reaffirmed that commitment in the 1998 

update to that strategy. According to the Commerce Department, U.S. 

service exports in 1998 equaled $260.3 billion, an increase of about

160 percent from 1988 and about 50 percent from 1993. In 1998, U.S. 

exports of services represented nearly 28 percent of total exports. The 

demand for U.S. services is fueled not only by increased foreign demand 

but also by the decentralization of manufacturing worldwide. U.S. firms 

need certain services as they seek to establish and maintain manufacturing 

facilities overseas. At the same time, technology has reduced the cost of 

providing services on a large scale and allowed them to be produced at a 

much greater distance from the customer. 

Commerce, as part of a wide-ranging effort to strengthen assistance 

provided to exporters, formed an inter-USEAC Services Team to focus on 

the needs of service exporters. 8 In fiscal year 1998, about 10 percent of the 

export actions submitted by Commerce staff at the USEACs were in 

support of service exporters. The Services Team, which is organized into 

several industry-focused subteams,9

 found that service exporters 

sometimes have difficulty using Commerce’s export promotion programs, 

which were largely designed for firms that export goods and are often 

unavailable or inappropriate for firms that export services. For example, 

Commerce could not make available adequate, up-to-date, market research 

for design service firms. Also, service exporters have experienced 

difficulty using Commerce’s Agent/Distributor Service program. This 

program, which U.S. firms typically use to locate overseas agents or 

distributors, can be inappropriate for service firms, who might use it to 

identify individuals interested in licensing a patent or participating in a 

franchise. USEAC directors, most of whom also stated that many current 

export assistance programs were not meeting the needs of firms that 

export services, echoed this finding. 

8

The Services Team is comprised of Commerce Trade Specialists from the Long Beach, Calif.; and 

Seattle, Wash., USEACs; USEAC satellite offices, including those in Anchorage, Alaska; Honolulu, 

Hawaii; Inland Empire, Calif.; Monterey, Calif.; Newport Beach, Calif.; Orange County, Calif.; Reno, Nev.; 

and San Francisco, Calif; and overseas posts, including those in Buenos Aires, Argentina; and Ontario, 

Canada.

9

Subteams include design services; training, consulting, and education; franchising; professional 

services; transportation; and travel and tourism.
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In connection with their participation on the inter-USEAC services team, 

Commerce staff at several USEACs we visited have implemented 

innovative approaches to assisting firms that export services. For example, 

the USEAC satellite office in San Francisco is working with firms in the 

design services industry (including architectural, engineering, industrial, 

graphic, and new media design) to develop a strategy to promote these 

firms’ exports. This office, in cooperation with the American Institute of 

Architects, has initiated a series of international videoconferences through 

which U.S. architects gain market intelligence and give presentations to 

potential clients. It has also organized firms from a wide range of design 

sectors into a consortium through which the members can, among other 

things, (1) pool resources to create more effective marketing tools than 

would be feasible for any single firm and (2) take advantage of enhanced 

visibility that the consortium achieves through its own brand name and 

partnership with large, brand-name corporations.

In another example, the Portland, Oreg., and Seattle, Wash., USEACs are 

working with two separate groups of colleges to develop strategies for each 

group to promote the enrollment of foreign students. Like tourism, 

education provided to foreign students in the United States is considered to 

be a service export. These USEACs, working with separate groups of 

colleges, have helped these colleges form consortiums to handle their 

efforts to attract foreign students in a more cost-effective manner than if 

each college were to act separately. In Portland, the consortium members 

to date have begun establishing rules governing participation in the 

consortium and making proposals for joint efforts. These include 

developing a consortium web site, obtaining sponsors, and generating 

consortium publications. 

The Portland, Oreg., USEAC has also found ways to use current Commerce 

programs to assist an organization that does not fit the traditional 

definition of an exporter. One of the USEAC’s clients is a health provider 

that brings foreign patients into the United States for surgery and related 

treatments. It arranges for patients and their families to travel to the 

United States, provides medical care to the patients and meals and lodging 

for the family, and arranges for their travel home. Like tourism, this health 

provider’s service is considered to be an export. Over the years, this firm 

has used the Portland, Oreg., USEAC to obtain National Trade Data Bank 

information and has participated in a Commerce Gold Key program in 

Hong Kong. Under the Gold Key program, U.S. embassies, for a fee, set up 

meetings in-country for U.S. firms seeking to meet with, among other 

things, potential customers, distributors, or agents. 
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Special Program May 

Hold Promise for 

Assisting Firms That 

Are Not Ready to 

Export

Beginning with its 1994 National Export Strategy, the TPCC has 

consistently characterized the USEACs as a key element in federal efforts 

to assist small- to medium-sized exporters and firms interested in 

exporting. Firms seeking USEAC assistance vary considerably in their 

ability to export. Commerce staff focuses on firms that are ready to export, 

and SBA and Eximbank staff provide export financing to firms that already 

have potential deals. As a result, most USEACs do not work directly with 

small- to medium-sized enterprises that are not ready to export but show 

potential. According to USEAC directors, bringing these firms to the point 

where they are export ready can be very labor intensive and time 

consuming. In such cases, the USEACs generally refer such firms to 

SBA-affiliated education programs or to similar state-affiliated or nonprofit 

export-service providers. Firms that have a viable domestic business are 

usually referred to a local Small Business Development Center. These 

facilities, sponsored in part by SBA, can provide the training that such 

companies need to build exporting into their business plan. Clients that do 

not meet this test are usually referred to the local Service Corps of Retired 

Executives chapter, which works with the firm to develop a business plan 

and to help to create the business processes needed to export. At each of 

the USEACs that relied on such organizations to assist not-ready-to-export 

firms, no formal mechanism existed for USEAC staff to follow up with 

firms that had been referred to education and training programs. 

To better serve firms that are not ready to export but show potential, SBA 

has encouraged the USEACs to adopt a program called the Export-Trade 

Assistance Partnership (E-TAP). This program, which was developed by 

the SBA Seattle District Office in the early 1990s, provides a structured 

mechanism for supplying such firms with comprehensive export education 

and follow-up export promotion assistance. Essentially, E-TAP involves a 

comprehensive presentation of “how to” information on exporting to an 

audience of firms interested in becoming exporters. The E-TAP could be 

industry specific or could be presented to firms from several industries. 

While this program was first developed by the SBA District Office prior to 

the creation of the USEAC network, the Seattle USEAC has adopted it as a 

primary program for assisting firms that are not ready to export. In 

addition to Seattle, two other USEACs—Dallas, Tex., and Long Beach, 

Calif.—have had several years of experience with the E-TAP program. 

Seven other USEACs have recently used the program on one or two 

occasions. (App. III contains the agenda for a 1998 E-TAP program 

sponsored by the Seattle USEAC.)
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While E-TAP programs may differ from location to location, they all involve 

three essential steps. First, the USEAC assesses its clients who are not 

ready to export in order to identify firms with the greatest potential to 

export and encourages them to apply for the E-TAP program. A client’s 

readiness for export trade development is based on, among other things, its 

management commitment, financial capacity, product qualification 

(including sales history), market potential, and production capacity. 

Second, the USEAC forms a consortium of federal and nonfederal 

export-service providers who present comprehensive, in-classroom 

training on export matters to these preselected firms. Presenters with 

whom we spoke indicated that they consider participating in an E-TAP 

program a worthwhile exercise because it exposes them to potential clients 

and is a productive way to meet professional requirements that they work 

with small- to medium-sized firms that might not otherwise be able to 

obtain their services. Third, the USEAC staff provides one-on-one 

follow-up assistance to those firms that complete the training and decide to 

become involved in exporting. Firms pay a fee to participate in the 

program. Firms successfully completing the program may be permitted to 

apply a large portion of that fee to obtain a Commerce Department export 

promotion service, such as the Gold Key service. Firms completing the 

program also may be encouraged to participate in an overseas trade 

mission, during which they would meet prospective customers and 

possibly make sales. 

In Seattle, several of the firms that have participated in this program have 

gone on to export. These include a manufacturer of wastewater treatment 

facilities that recognized that U.S. firms establishing manufacturing 

facilities overseas would need its products. At the suggestion of the 

USEAC, the company sent one of its managers to an E-TAP program in 

1994. The company then developed a close working relationship with the 

Seattle USEAC as it gained experience working with a bank that finances 

export transactions, learned how to structure export transactions to ensure 

repayment, and contacted a law firm to handle the legal aspects of 

exporting. In 1995, the firm used the Commerce Gold Key program to 

arrange a visit to Singapore where, working with a joint venture partner, it 

secured its first export sale—a $750,000 wastewater treatment facility. 

Exports now represent about 70 percent of the company’s total sales. 

Similarly, a Seattle engineering company decided that, to maintain a steady 

level of business, it would need to broaden its customer base by expanding 

to export markets. At the suggestion of the USEAC, this firm’s President 

and Marketing Manager attended an E-TAP program. Subsequent to the 

program, the firm developed a working relationship with the USEAC and 
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Page 11 GAO/NSIAD-99-180 Export Assistance Centers

eventually made its first export sale. This firm currently works in countries 

throughout the Caribbean. 

Agency Comments Commerce and SBA provided oral comments on a draft of this report. Both 

agencies generally agreed with the information and analyses in the report. 

Commerce characterized the report as well balanced and focused on issues 

that the USEACs need to address. Commerce also emphasized that it is 

actively pursuing a strategy for improving assistance to firms that export 

services and that it supports the use of E-TAP as a method for assisting 

firms that are not ready to export but show potential. SBA also commented 

that its USEAC staff would soon be using Commerce’s CMS client tracking 

system. Both agencies provided updated information that has been 

incorporated in the report where appropriate. The Eximbank did not 

comment on the report. 

We are sending copies of this report to appropriate congressional 

committees; the Honorable William M. Daley, the Secretary of Commerce, 

who also serves as Chairman of the TPCC; the Honorable Aida Alvarez, 

Administrator of the Small Business Administration; the Honorable James 

A. Harmon, Chairman of the U.S. Export-Import Bank; and the Honorable 

Jacob Lew, Director, Office of Management and Budget. We will also make 

copies available to others upon request.

Please contact me at (202) 512-4128 if you or your staff have any questions 

about this report. Other GAO contacts and staff acknowledgments are 

listed in appendix V.

 Sincerely yours,

Benjamin F. Nelson, Director

International Relations and Trade Issues
Page 12 GAO/NSIAD-99-180 Export Assistance Centers

Contents

Letter 1

Appendix I

Legislative Mandate for 

Agencies to Participate 

in Export Programs

14

Appendix II

The USEAC Network

17

Appendix III

The Seattle USEAC’s 

Export-Trade 

Assistance Partnership 

Program

20

Appendix IV

Objectives, Scope, and 

Methodology

22

Appendix V

GAO Contacts and 

Staff 

Acknowledgments

24

Tables Table II.1: The Nationwide USEAC Network 17

Table III.1: Sample E-TAP Program Agenda 20
Contents

Page 13 GAO/NSIAD-99-180 Export Assistance Centers

Abbreviations

CMS Client Management System

E-TAP Export-Trade Assistance Partnership

Eximbank U.S. Export-Import Bank

SBA Small Business Administration

TPCC Trade Promotion Coordinating Committee

USEAC U.S. Export Assistance Center
Page 14 GAO/NSIAD-99-180 Export Assistance Centers

Appendix I

Legislative Mandate for Agencies to 

Participate in Export Programs ApenxIdi

As discussed in the following paragraphs, U.S. Export Assistance Center 

(USEAC) efforts to assist exporters are governed by legislation creating the 

USEAC network, as well as legislation governing the activities of each 

federal agency participating in the USEAC network. These agencies 

include the Commerce Department, the Small Business Administration 

(SBA), and the U.S. Export-Import Bank (Eximbank). Based on legislation, 

these agencies have developed programs and services, which they market 

to businesses both directly and indirectly through partner organizations.

The Commerce 

Department

The Omnibus Trade and Competitiveness Act of 1988 (15 U.S.C. 4721), as 

amended, outlines the basic responsibilities of the Commerce staff at the 

U.S. Export Assistance Centers. This legislation requires that they place 

primary emphasis on assisting small- to medium-sized businesses. Among 

other things, it instructs Commerce to identify such U.S. businesses with 

the potential to export goods and services and to

• provide them with information and advice on establishing export 

businesses;

• provide them with actual leads and an introduction to contacts within 

foreign countries and information on, among other things, economic 

conditions, market opportunities, and the legal and regulatory 

environment within foreign countries;

• assist them in locating reliable sources of business services in foreign 

countries and in their dealings with foreign governments and 

government-owned enterprises; and

• assist with the coordination of state and local government and private 

export-service organizations so as to maximize effectiveness and 

minimize duplication of effort. 

Commerce implements these requirements through a broad array of export 

promotion programs and activities. These include

• counseling on various phases of exporting, often in conjunction with 

specific market information and possibly trade leads and referrals;

• market information from region-specific sources, such as the European 

Union Single Internal Market 1992 Information System; and global 

databases, such as the National Trade Data Base, which contains a vast 

amount of information and statistics on many aspects of exporting;

• trade leads and referrals, which seek to provide exporters with specific 

export sales leads, the opportunity to market products or services 
Appendix I

Legislative Mandate for Agencies to 

Participate in Export Programs

Page 15 GAO/NSIAD-99-180 Export Assistance Centers

abroad, and an in-country office to conduct business in export markets; 

and

• advocacy made on behalf of U.S. firms to foreign governments and 

government-owned enterprises. 

The Small Business 

Administration

The Small Business Act (15 U.S.C. 631), as amended, among other things, 

created within SBA an Office of International Trade, which was authorized 

to promote small business exporting. This legislation instructs the Office 

of International Trade to work closely with Commerce and other 

export-service providers to assist the small business community by, among 

other things, aggressively marketing existing pre-export finance programs. 

The Office of International Trade pursues this requirement through the SBA 

staff at the USEACs, who devote nearly 80 percent of their time to 

promoting the agency’s Export Working Capital Program and the remaining 

time to other USEAC-related activities. In addition, the SBA-affiliated 

Small Business Development Centers1

 provide counseling and in-classroom 

training, usually through a community college, on a wide range of business 

topics, including exporting. Similarly, the SBA-affiliated Service Corps of 

Retired Executives2

 program is composed of retired executives who 

volunteer their time to counsel small businesses on a wide range of 

business topics, including exporting.

The U.S. Export-Import 

Bank

The Export-Import Bank Act of 1945 (12 U.S.C. 635), as amended, governs 

the activities of the Eximbank’s USEAC staff. This legislation creates the 

framework guiding Eximbank efforts to provide finance in the form of, 

among other things, insurance, guarantees, and loans to U.S. exporters. It 

instructs the Eximbank to promote small business exporting and the use of 

its programs “in cooperation with the Secretary of Commerce, the Office of 

International Trade of the Small Business Administration, and the private 

1

The Small Business Development Center program is a cooperative effort of the private sector; 

educational community; and federal, state, and local governments to deliver up-to-date counseling, 

training, and technical assistance in all aspects of small business management. There are currently

57 Small Business Development Centers, with a network of over 1,000 service locations. In 1998, 

approximately 4.5 percent of those who attended a Small Business Development Center training 

program or sought guidance from one of its counselors received instruction on international trade 

matters. 

2

Through the Service Corps of Retired Executives program, which was initiated in 1964, retired 

executives volunteer to assist individuals who need advice regarding starting or managing a small 

business. Program management does not maintain reliable information on the extent to which its 

counselors address trade-related issues. 
Appendix I

Legislative Mandate for Agencies to 

Participate in Export Programs

Page 16 GAO/NSIAD-99-180 Export Assistance Centers

sector . . . State agencies, chambers of commerce, banking organizations, 

export management companies, export trading companies, and private 

industry.” Eximbank staff at the USEACs work with business directly and 

through two “multiplier” programs: the City/State Program and the 

Delegated Authority Program. Under the Eximbank’s City/State Program,3

qualifying state and local governments can provide Eximbank guarantees 

on a co-financing basis. Under the Eximbank’s Delegated Authority 

Program,4

 qualifying lending institutions can process and approve an 

Eximbank working capital guarantee without the need for the Eximbank’s 

approval. 

USEAC Marketing of 

Programs and Services

USEACs market their services in various ways. They do so directly to 

exporters through presentations at export conferences and seminars. For 

example, USEAC staff use booths at conferences to distribute literature 

and meet with firms potentially interested in USEAC services. Such 

literature might include brochures, packets of more detailed information 

on USEAC services, or book-length publications, such as Commerce’s

A Basic Guide to Exporting. They also give presentations at seminars that 

seek to interest firms in exporting or to inform current exporters of the 

services available in a metropolitan area.

USEACs also market their services indirectly and on-line. They work 

indirectly through formal relationships with organizations, such as the 

finance organizations that participate in the Eximbank’s City/State and 

Delegated Authority programs. USEACs also work through informal 

relationships with numerous state and local, nonprofit, and private 

organizations that represent USEAC services to their clients or refer their 

clients to the USEACs. Each of the primary USEAC agencies has a page 

on the worldwide web. These web pages contain a wide variety of 

information, ranging from “how to” information appropriate for those 

becoming interested in exporting to more specialized information for the 

experienced exporter. The Commerce web page also contains links to the 

web pages of individual USEACs. The primary agencies’ web page 

addresses are Commerce (www.ita.doc.gov/uscs), SBA (www.sba.gov/oit), 

and the Eximbank (www.exim.gov).

3

According to the Eximbank, 36 state and local organizations participate in its City/State Program.

4

According to the Eximbank, 216 lending institutions nationwide participate in the Delegated Authority 

Program.
Page 17 GAO/NSIAD-99-180 Export Assistance Centers

Appendix II

The USEAC Network ApenxIdi

Table II.1 illustrates the USEAC network, which is comprised of

19 USEACs and 84 satellite offices. Of the 19 USEACs, 5 have staff from 

Commerce, SBA, and the Eximbank; the remaining centers have staff from 

Commerce and SBA. The satellite offices usually consist of one or two 

Commerce staff members. Nationwide, these satellite offices are aligned 

with the USEACs in a “hub-and-spoke” formation, although individual 

USEAC directors may alter the pattern.1

 USEACs are connected through 

Commerce with the Foreign Commercial Service at U.S. embassies and 

consulates. They also seek to work closely with the nonfederal 

export-service providers.

Table II.1: The Nationwide USEAC Network

1

For example, the Atlanta, Ga., USEAC does not have each of its three satellite offices in Tennessee 

report directly to Atlanta. Rather, the offices in Memphis and Knoxville, Tenn., report to the satellite 

office in Nashville, Tenn., which reports to the Atlanta, Ga., USEAC.

USEAC Federal agencies Satellite offices

Atlanta, Ga. (Sunbelt) 

USEAC

 

Commerce

SBA

U.S. Department of

 Agriculture 

Birmingham, Ala.

Knoxville, Tenn.

Memphis, Tenn.

Nashville, Tenn.

Savannah, Ga.

Baltimore, Md., USEAC

 

Commerce

SBA

Arlington, Va.

Charleston, W. Va.

Harrisburg, Pa.

Richmond, Va.

Wheeling, W. Va.

Boston, Mass., USEAC

 

Commerce

SBA

Marlborough, Mass.

Middletown, Conn.

Montpelier, Vt.

Portland, Maine

Portsmouth, N.H.

Providence, R.I.

Charlotte, N.C., (Carolinas) 

USEAC

Commerce

SBA

Charleston, S.C.

Columbia, S.C.

Greensboro, N.C.

Greenville, S.C.

Chicago, Ill., USEAC

 

Commerce

Eximbank

SBA

Highland Park, Ill.

Milwaukee, Wis.

Peoria, Ill.

Rockford, Ill.
Appendix II

The USEAC Network

Page 18 GAO/NSIAD-99-180 Export Assistance Centers

Cleveland, Ohio, USEAC

 

Commerce

SBA

Buffalo, N.Y.

Cincinnati, Ohio

Columbus, Ohio

Louisville, Ky.

Pittsburgh, Pa.

Somerset, Ky.

Toledo, Ohio

Dallas, Tex., USEAC

 

Commerce

SBA

Austin, Tex.

Fort Worth, Tex.

Houston, Tex.

Oklahoma City, Okla.

San Antonio, Tex.

Tulsa, Okla. 

Denver, Colo., USEAC Commerce

SBA

Salt Lake City, Utah

Santa Fe, N. Mex.

Detroit, Mich., USEAC

 

Commerce

SBA

Ann Arbor, Mich.

Grand Rapids, Mich.

Indianapolis, Ind.

Pontiac, Mich.

Long Beach, Calif., USEAC

 

U.S. Agency for

 International Development

 (at Inland Empire, Calif., 

 satellite office)

Commerce

Eximbank

SBA

Inland Empire, Calif.

Los Angeles, Calif.

 (downtown)

Orange Country, Calif.

Phoenix, Ariz.

San Diego, Calif.

Tucson, Ariz.

Ventura County, Calif.

West Los Angeles, Calif.

Miami, Fla., USEAC

 

Commerce

SBA

Eximbank

Clearwater, Fla.

Orlando, Fla.

San Juan, P.R.

Tallahassee, Fla.

Minneapolis, Minn., USEAC Commerce

SBA

Sioux Falls, S. Dak.

New Orleans, La.

 (Delta) USEAC

Commerce

SBA

Jackson, Miss.

Little Rock, Ark.

Shreveport, La.

New York, N.Y., USEAC

 

Commerce

SBA

Eximbank

Harlem, N.Y.

Long Island, N.Y.

Newark, N.J.

Trenton, N.J.

Westchester, N.Y.

Philadelphia, Pa., USEAC Commerce

SBA

Scranton, Pa.

Portland, Oreg., USEAC

 

Commerce

SBA

Economic Development

 Administration

Boise, Idaho

Eugene, Oreg.

Missoula, Mont.

USEAC Federal agencies Satellite offices
Appendix II

The USEAC Network

Page 19 GAO/NSIAD-99-180 Export Assistance Centers

Source: U.S. Department of Commerce, Office of Domestic Operations, U.S. & Foreign Commercial 

Service.

San Jose, Calif., USEAC

 

Commerce

SBA

Eximbank

Fresno, Calif.

Honolulu, Hawaii

Monterey, Calif.

North Bay, Calif.

Oakland, Calif.

Reno, Nev.

Sacramento, Calif.

San Francisco, Calif.

Santa Clara, Calif.

Seattle, Wash., USEAC

 

Commerce

SBA

Anchorage, Alaska

Spokane, Wash.

Tacoma, Wash.

St. Louis, Mo., USEAC

 

Commerce

SBA

Des Moines, Iowa

Kansas City, Mo.

Omaha, Nebr.

Wichita, Kans.

USEAC Federal agencies Satellite offices
Page 20 GAO/NSIAD-99-180 Export Assistance Centers

Appendix III

The Seattle USEAC’s Export-Trade Assistance 

Partnership Program ApenIxdi

Table III.1 shows the agenda for an Export-Trade Assistance Partnership 

(E-TAP) program managed by the Seattle, Wash., USEAC during March–

April 1998. The sessions were held 7 days apart. The program involved

24 different speakers presenting 24 topics. To attend every session would 

require a commitment of nearly 22 hours of class time. This E-TAP 

represents the most recent one managed by the Seattle USEAC for a 

general (as opposed to single industry) audience. 

Table III.1: Sample E-TAP Program Agenda

Session contents Presenter’s organization Durationa

Session I – Introduction

Welcome & introduction

E-TAP overview

Commitment to exporting

Export issues & concerns

Seattle USEAC (SBA) 1⁄2 hour

Case study by former

E-TAP participant

Private firm 1 hour

SBDC b export development

programs

Seattle USEAC (SBDC) 1⁄4 hour

Business plans Seattle USEAC (SBA) 1 1⁄4 hour

Credit risk: due diligence Seattle USEAC (Export Finance 

Assistance Center of Washington)c

3⁄4 hour

Session II – Marketing

Product and market 

research International pricing

Private firm 1 3⁄4 hour

International sales options Consulting firm 2 hours

Session III – Marketing

Commerce programs and

services

Seattle USEAC (Commerce) 1 1⁄4 hours

International trade shows Washington State International Trade Fair 1 hour

International culture and

politics

Consulting firm 1 1⁄2 hours

Legal issues Private law firm 1 hour
Appendix III

The Seattle USEAC’s Export-Trade 

Assistance Partnership Program

Page 21 GAO/NSIAD-99-180 Export Assistance Centers

a

All times are approximate.

b

The Small Business Development Center (SBDC) in Seattle is located within the USEAC.

c

The Export Finance Assistance Center of Washington, a state government export finance agency, is 

located within the Seattle USEAC. 

Source: U.S. Export Assistance Center, Seattle, Washington.

Session IV – Legal and finance

International methods of

payment

Bank 1 hour

Local banking services Bank 1⁄2 hour

SBA’s and Eximbank’s

Export Working Capital

programs

Seattle USEAC (Export Finance 

Assistance Center of Washington)c

1⁄2 hour

Specialized export finance 

and risk enhancement

programs Insurance

Seattle USEAC (Export Finance 

Assistance Center of Washington)c

3⁄4 hour

Session V – Tax, export documentation, and transportation

Tax issues Accounting firm 1 hour

Air freight forwarding Freight forwarder 1 hour

Ocean service freight

forwarding

Freight forwarder 3⁄4 hour

Insurance Insurer 1 hour

Session VI – Financial plan and wrap-up

Developing your financial

business plan

SBA Seattle District Office 2 3⁄4 hours

Washington State government’s 

international trade programs

Washington State Departments of 

Community, Trade and Economic 

Development; and Agriculture

1⁄2 hour

Next step/wrap-up Seattle USEAC (Commerce) 1⁄4 hour

Reception Sponsored by accounting firm
Page 22 GAO/NSIAD-99-180 Export Assistance Centers

Appendix IV

Objectives, Scope, and Methodology ApenVIxdi

At the request of Senator Gordon Smith, we examined activities of the 

USEAC network. Specifically, we sought to identify the nature of 

coordination among the federal agencies participating in the USEAC 

network and between these agencies and nonfederal export-service 

providers. We also sought to identify USEAC assistance to firms that 

export services and to firms that are not ready to export but show potential 

and interest in doing so.

To obtain background information on the USEAC network, we interviewed 

staff of the Trade Promotion Coordinating Committee (TPCC) Secretariat; 

Commerce, SBA, and Eximbank headquarters officials; the Commerce 

Office of the Inspector General; and staff at trade associations with an 

interest in USEAC operations. We reviewed documents provided by these 

organizations and reviewed legislation governing the creation of the 

USEAC network and the programs and services of participating federal 

agencies. We also obtained information on the location of all 19 USEACs 

and 84 satellite offices, lines of authority among them, agencies 

participating at each site, and the affiliations and activities of nonfederal 

partners at each site.

To determine the nature of coordination among USEAC agencies and 

cooperation with nonfederal export-service providers, we visited the 

USEACs in Atlanta, Ga.; Baltimore, Md.; New York, N.Y.; Portland, Oreg.; 

San Jose, Calif.; and Seattle, Wash. There, we obtained up-to-date 

information from the USEAC, as well as other export-service providers and 

clients recommended by USEAC staff, regarding the level of coordination 

among the USEAC partners and the nature of their cooperation with 

nonfederal export-service providers. These USEACs were selected based 

on geographic location, availability of resources, and the relevancy of one 

or more aspects of their operations to issues being addressed in this review. 

We conducted a telephone survey of directors at USEACs we did not visit 

to obtain information on the nature of their cooperation with nonfederal 

export-service providers and sought information on their most significant 

accomplishments in cooperation with such export-service providers. We 

also analyzed “export actions” submitted to Commerce’s Client 

Management System (CMS) by its USEAC staff to identify those that 

mentioned participation by another export-service provider. Of the

6,009 export actions, 1,196 (19.90 percent) mentioned assistance from a 

partner export-service provider. We obtained information regarding 

Commerce’s operation and use of CMS, and Commerce staff views on the 

validity of the information generated through the system but did not 

independently test CMS’ accuracy or completeness. 
Appendix IV

Objectives, Scope, and Methodology

Page 23 GAO/NSIAD-99-180 Export Assistance Centers

To determine the status of USEAC efforts to provide assistance to firms 

that export services, we first obtained information on the service industry. 

During our visits to the USEACs in Atlanta, Baltimore, New York, Portland, 

San Jose, and Seattle, we obtained up-to-date information from the USEAC, 

other export-service providers, and clients (including several service 

exporters), regarding USEAC efforts to assist firms that export services. In 

our telephone survey of directors at USEACs we did not visit, we asked 

them to identify Commerce export promotion programs that are relevant to 

firms that export services and provide their overall opinion of whether they 

have the tools to help these firms and, if not, what needs to be done to 

strengthen Commerce assistance to such firms. We also analyzed “export 

actions” submitted to Commerce’s CMS by its USEAC staff to identify those 

that dealt with assistance provided to service exporters. Of the

6,009 export actions that we analyzed, 636 (10.58 percent) involved 

assistance to firms that export services.

To determine the status of USEAC efforts to provide assistance to firms 

that are not yet ready to export, we obtained information from the Service 

Corps of Retired Executives and the Small Business Development Center 

headquarters offices regarding their services, nationwide network of sites, 

and cooperation with the USEACs. During our visits to the USEACs in 

Atlanta, Baltimore, New York, Portland, San Jose, and Seattle, we obtained 

up-to-date information from the USEAC, other export-service providers, 

and clients regarding USEAC efforts to assist firms that are not ready to 

export. We focused on this objective during our visit to Seattle, where we 

obtained in-depth information on that USEAC’s E-TAP program from 

USEAC staff, presenters, and participating firms. In our telephone survey 

of directors at USEACs we did not visit, we asked them to identify the 

services they use to assist firms that are not ready to export, including an 

E-TAP program, and to comment on the relative success they have had with 

each. 

We did our work from August 1998 to June 1999 in accordance with 

generally accepted government auditing standards.
Page 24 GAO/NSIAD-99-180 Export Assistance Centers

Appendix V

GAO Contacts and Staff Acknowledgments ApenVdxi

GAO Contact John Hutton, (202) 512-7773

Acknowledgments In addition to Mr. Hutton, Joseph Natalicchio, David Artadi, Carlos Evora, 

Jose Péña, Tracey Hébert-Barry, and Kathleen Joyce made key 

contributions to this report.

(711375)
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