House Judiciary Committee Chairman Lamar Smith (R-Texas) today voted in favor of the No More Solyndras Act (H.R. 6213), a bill to better protect American taxpayers and prevent Obama administration officials from giving loan guarantees based off of political favoritism rather than financial credibility. The House of Representatives approved the bill by a vote of 245-161.
Chairman Smith: "We must put a stop to the Obama administration's use of taxpayer dollars to bail out campaign contributors at the expense of the American people. The No More Solyndras Act reins in the costly and misguided Department of Energy loan guarantee program and increases transparency to ensure that loans are not awarded as part of a partisan payback to political allies.
"The President's policies have failed to stimulate the economy and put Americans back to work. Rather than Solyndra-style economics, we need to promote projects like the Keystone Pipeline that we know will create jobs for American workers."
The No More Solyndras Act phases out the Department of Energy's (DOE) flawed loan guarantee program, adds protections for taxpayers to any new guarantee issued for an existing application, increases transparency by requiring DOE to report to Congress on existing applicants, and prohibits DOE from restructuring the terms of any guarantee without first consulting with the Treasury Department.
Background on Solyndra Loan: Despite warnings about its financial stability from government officials, the Obama administration approved a loan guarantee for Solyndra in spring of 2009. According to documents obtained by the House Energy and Commerce Committee, approval for DOE's $535 million loan guarantee was rushed through in order to meet a press event deadline for Solyndra's groundbreaking. Vice President Biden spoke at the event via satellite and hailed Solyndra's ability to create "permanent jobs."
DOE officials ignored the advice of the Treasury Department, and in 2011 restructured the half-billion dollar loan to Solyndra so that private investors moved ahead of taxpayers for repayment on part of the loan in case of a default. In September 2011, Solyndra filed for bankruptcy. Just a few days later, the FBI raided the Solyndra offices.