No More Solyndras Act
Floor Speech
The SPEAKER pro tempore. The Chair recognizes the gentleman from Florida (Mr. Stearns) for 5 minutes.
Mr. STEARNS. Mr. Speaker and my colleagues, later today, we will begin debate on the rule for H.R. 6213, the No More Solyndras Act, which, along with my chairman, Fred Upton of Michigan, I am proud to sponsor. This legislation is a culmination of an intensive and thorough 18-month investigation by the Subcommittee on Oversight and Investigations, which I chair, and will fix the problems we have uncovered.
Specifically, the No More Solyndras Act will phase out the Department of Energy's grossly mismanaged loan guarantee program by prohibiting DOE from issuing any loan guarantees for applications submitted after December 31, 2011, and it will provide taxpayers strong, new protection for any pending participants in this program.
The bill provides greater loan guarantee transparency by requiring the DOE to report to Congress on the decisionmaking process, and, of course, the details of the loan. The bill also prohibits DOE from restructuring the terms of any guarantee and forbids the subordination of United States taxpayers' dollars at any time to private investors and holds the Department of Energy officials accountable for their actions by imposing penalties by failing to follow this law.
As many of you know, Solyndra was the first recipient of a DOE loan guarantee from title XVII of the Energy Policy Act of 2005 and, frankly, was the poster child for President Obama's stimulus-driven green economy. It was also the first stimulus-backed recipient of a DOE loan guarantee to file for bankruptcy just 2 years after the loan closed, and 6 months after DOE restructured the loan and subordinated taxpayers' interest to two wealthy and well-connected investors, all but ensuring taxpayers won't see a dime.
Other DOE loan recipients have also struggled. Three of the first five companies which received loan guarantees issued by the DOE Loan Guarantee program--Solyndra, Beacon, and Abound Solar--have all filed for bankruptcy, losing hundreds of millions of dollars of taxpayers' money that will never, ever be recovered. The other two companies are struggling, also. Nevada Geothermal has substantial debts and no positive cash flow, and First Wind had to withdraw their planned IPO and also has substantial debt to boot.
On behalf of the American taxpayers, we had a duty to figure out what went wrong with Solyndra, the loan guarantee, and whether the loan guarantee program was properly managed. The Solyndra investigation has been thorough and methodical. The Energy and Commerce Committee requested and received and reviewed documents from every executive branch agency connected to Solyndra, and interviewed more than a dozen administration officials who played key roles in the loan guarantee program. The committee has also reviewed documents produced by the Solyndra investors, as well as DOE's independent consultant and their legal advisers.
As the committee's investigation revealed, the Obama administration put Solyndra's loan on the fast track for political reasons, despite repeated red flags and warnings in 2009 from the Office of Management and Budget and DOE officials about the company's financial condition in the market for Solyndra's product. Were they viable? It is clear that DOE failed to adequately monitor the loan guarantee, blindly writing checks to Solyndra as the company hemorrhaged cash throughout the year 2010.
When the warnings came to fruition and Solyndra was out of cash in the autumn of 2010, the Obama administration doubled down on its bad debt and bad bet, restructuring Solyndra's loan in early 2011 and putting wealthy investors at the front of the line in front of taxpayers, which is a clear violation of the Energy Policy Act of 2005. Right up to the bankruptcy filing, the administration was willing to take extraordinary measures to keep Solyndra afloat for political reasons and ensure that the first loan guarantee was not going to be a failure.
The investigation also showed that the DOE failed to consult with the Treasury Department as simply required by the Energy Policy Act prior to issuing a conditional commitment to Solyndra and that Treasury didn't even play a role in simply reviewing the restructuring. The No More Solyndras Act will correct this by ensuring that Treasury is actively involved in the loan process to protect our taxpayers.
Mr. Speaker, the Solyndra investigation and the No More Solyndras Act are a great example of how congressional oversight should work. We asked the tough questions, collected all the facts, identified the problem, and now we're offering good legislation.
I encourage all my colleagues to support H.R. 6213, the No More Solyndras Act, to ensure that the mistakes and misguided decisions that occurred never, ever happen again.
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