GAO-13-717R COMPETES Reauthorization Act

441 G St. N.W.

Washington, DC 20548

July 24, 2013

The Honorable John D. Rockefeller

Chairman

The Honorable John Thune

Ranking Member

Committee on Commerce, Science, and Transportation

United States Senate

The Honorable Lamar Smith

Chairman

The Honorable Eddie Bernice Johnson

Ranking Member

Committee on Science, Space, and Technology

House of Representatives

COMPETES Reauthorization Act: Federal Loan Guarantees for Innovative Technologies 

in Manufacturing 

The America COMPETES Reauthorization Act of 2010 directed the Secretary of the Department 

of Commerce to establish the Federal Loan Guarantees for Innovative Technologies in 

Manufacturing program.1 This program is to provide loan guarantees for small- or medium-sized 

manufacturers for the use or production of innovative technologies. The act also mandated that 

GAO conduct a biennial review of the execution of the program and submit a report on the 

review conducted to Congress. This report addresses the status of Commerce’s efforts to 

execute the Federal Loan Guarantees for Innovative Technologies in Manufacturing program. 

To determine the status of Commerce’s efforts to execute the program, we reviewed relevant 

laws and documentation from Commerce’s Economic Development Administration (EDA). We 

also interviewed officials overseeing the execution of the program.

Officials with EDA said that the agency has taken preliminary steps to execute the Federal Loan 

Guarantees for Innovative Technologies in Manufacturing program but, as of June 2013, had 

not issued any loan guarantees under this program. The steps EDA officials stated that they 

have taken to execute the program include (1) establishing a staffing budget and initiating a 

search for key staff members such as an attorney and a program director, (2) obtaining 

technical assistance from the Small Business Administration on how to develop a loan 

guarantee program, (3) creating a timeline for executing the program, and (4) publishing in the 

Federal Register a request for comments from manufacturers and potential lenders on the level 

of demand and ideal structure for such a program. According to the timeline, initial awards could 

be finalized in mid- to late-2015. Officials told us they received four responses to the request for 

comments, which suggested to them that interest in such a program is limited. The program

 

1 Pub. L. No. 111-358, 124 Stat. 3982 (Jan. 4, 2011). This law reauthorized the America Creating Opportunities to 

Meaningfully Promote Excellence in Technology, Education, and Science (COMPETES) Act.
Page 2 GAO-13-717R COMPETES Reauthorization Act

received $10 million in appropriations—$5 million in fiscal year 2012 and $5 million in fiscal year 

2013—which by law are to remain available until expended.2 No funds have been obligated by

the program as of June 2013, according to EDA officials. 

We conducted our work from May to July 2013 in accordance with generally accepted 

government auditing standards. Those standards require that we plan and perform the audit to 

obtain sufficient, appropriate evidence to provide a reasonable basis for our findings and 

conclusions based on our audit objectives. We believe that the evidence obtained provides a 

reasonable basis for our findings and conclusions based on our audit objectives.

We are not making any recommendations in this report.

We provided Commerce a draft of this report. Commerce did not have any comments on the 

draft.

We are sending copies of this report to the Secretary of Commerce, the appropriate 

congressional committees, and other interested parties. In addition, the report is available at no 

charge on the GAO website at http://www.gao.gov. 

If you or your staff members have any questions about this report, please contact me at (202) 

512-3841 or ruscof@gao.gov. Contact points for our Offices of Congressional Relations and 

Public Affairs may be found on the last page of this report. GAO staff who made key 

contributions to this report were Karla Springer, Assistant Director; Nicole Dery; Cynthia Norris; 

and Marietta Mayfield Revesz.

Frank Rusco

Director, Natural Resources and Environment

(361495)

 

2 See Pub. L. No. 112-55 (2012) and Pub. L. No. 113-6 (2013). 
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necessary if you wish to reproduce this material separately.
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