Kinzinger Questions Loss of Half a Billion Dollars in Solyndra Loans

From the office of Rep. Adam Kinzinger (R, Illinois 11th District)…

Kinzinger Questions Energy Secretary Chu Over Potential Loss of Taxpayers’ Half a Billion Dollars in Solyndra Loan Guarantee

WASHINGTON, D.C. – During questioning by U.S. Congressman Adam Kinzinger (IL-11), a member of the House Energy and Commerce Committee, over the Solyndra loan guarantee, Energy Secretary Chu yesterday admitted that there is only a “reasonable chance” that the government will be paid back for the loans distributed.

In the testimony, Kinzinger asked:

“So shovel-ready is, even at the cost of millions of dollars a job, putting people back to work?”

Secretary Chu responded “No. As — as very clearly stated in the law and clearly stated in what we do, we wanted to make sure that there’s a reasonable chance of pay back and in all our loans going forward, that’s and — probability of being paid back is reflected in credit subsidy scores.”

Following the hearing, Kinzinger said “At a time when taxpayers stand to lose more than a half a billion dollars, a ‘chance’ of getting that money returned simply is not good enough. We must hold the Obama Administration accountable from accruing further losses for the taxpayer. The Department of Energy must report to the people how many other companies are in jeopardy and the impact their possible failure will have on our economy.

Secretary Chu had multiple opportunities to apologize to the taxpayers, but never did. Rather, he simply brushed off Solyndra’s bankruptcy and compared it to a natural disaster when he said ‘Fundamentally, this company and several others got caught in a bad tsunami.’

“Government must be held accountable when dealing with taxpayer dollars – whether it was an oversight or a failure to acknowledge warning signs, the American people deserve answers.”

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Full Transcript

KINZINGER: Thank you, Mr. Secretary, obviously when we deal with this amount of money, it’s important to get all these questions out and we appreciate you — you being here. We appreciate your service and — and thank you for — for coming before us today.

Let me ask you, and I know you’ve already addressed it already to an extent, but — but I want to ask you, did the stimulus deadlines accelerate the review of Solyndra’s case, specifically? The — the deadlines put in by the stimulus, did it accelerate the review of the case?

CHU: No, it did not. You know from the time of the completed application to the time we gave — closed on the loan, it was about 980 days, we would consider that …

KINZINGER: Because in congressional testimony dated March 19, 2009, DOE stimulus advisor, Matt Rodgers stated that you directed us to accelerate the process significantly and deliver the first loans in a matter of months while maintaining the appropriate oversight and due diligence.

Did you direct the loan program’s officer to speed up the process?

CHU: Yes, we wanted very much so that the loans would not all be taking 980 days, that is correct.

KINZINGER: But you didn’t — so you wanted it sped up after the acceleration of — after the Solyndra loan is what you’re saying?

CHU: No, I — what — as he — as he said, when I was before Congress in the confirmation hearing there was, on both sides of the aisle much concern that the loan program was not getting the loans out, again the economy was in freefall, hundreds of thousands of jobs were being lost each month and it was considered by both sides of — of the aisle that this loan program was effective way of getting capital and — and helping that capital be invested in — in energy projects, renewable energy and — and those things.

And so it was the concern as said, over — nearly 500 letters from members …


CHU: … letters from members of Congress on both sides of the aisle saying …

KINZINGER: Thank you and in — in January 2009, DOE documents show the loan programs office credit policy group listed 14 outstanding issues that needed to be resolved on the Solyndra deal, including analyzing the parent’s working capital needs and evaluating the parents funding requirements and financial health. A market report for Solyndra had yet to be submitted. One staff member reviewing the engineering reviewing the engineering reports listed eight different questions about its findings, including about Solyndra’s plans to scale up production. Yet on March 17, DOE offered a conditional commitment to Solyndra. Just a few weeks later, so you’re telling me the DOE was able to resolve in that short amount of time, all 14 credit policies?

CHU: I think — I think if you’re talking about these issues in the beginning of January versus March, we resolved many of those issues when we offer a conditional commitment then these, before the loan disbursements start, that the company will have to resolve all issues and that’s what a conditional commitment means. There will be additional conditions before we actually disburse any funds.

KINZINGER: And let me ask you, also too, being as how this is all, you know, stimulus related, stimulus financing; How would you define the concept of shovel-ready projects and do you think we realized those goals?

CHU: I think what we were looking for, what Congress was looking for, what the administration was looking for were those projects that could put Americans back to work in a very, very desperate time and I think many of the loans, for example, if you consider the Ford loan …

CHU: … which we think is a big success, saving some 30 plus thousand jobs and …

KINZINGER: So shovel-ready is, even at the cost of millions of dollars a job, putting people back to work?

CHU: No. As — as very clearly stated in the law and clearly stated in what we do, we wanted to make sure that there’s a reasonable chance of pay back and in all our loans going forward, that’s and — probability of being paid back is reflected in credit subsidy scores.

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