Supporters of strategy call it an effort to keep Solyndra solvent, thereby preventing any losses to taxpayers
Rep. Steve Scalise, R-Jefferson, joined 23 other GOP House members last week in urging Attorney General Eric Holder to undo a restructuring of a federal loan guarantee to Solyndra that put taxpayers behind private financers if the company ran into financial problems. The solar panel company went bankrupt last year, making it likely the federal government will lose its $535 million loan guarantee for the California-based firm.
View full sizeThe Solyndra solar panel factory in Fremont, Calif., was photographed in October 2010. Obama administration officials said they restructured the loan guarantee in hopes it would be enough to keep Solyndra solvent, thereby preventing any losses to taxpayers.
In the letter to Holder, the Republicans say they've been told by a veteran Treasury Department official that he had never seen a loan restructuring "which subordinated the taxpayer to private investors."
The Department of Energy agreed to the restructuring, even though Office of Management and Budget staffers "suggested that liquidation of Solyndra would provide the best chance for recovering taxpayer funds and noted that restructuring of the loan could result in lower recoveries in the event of the Solyndra default," Scalise and his fellow Republicans said in their letter to Holder.
Bruce Alpert can be reached at balpert@timespicayune.com or 202.450.1406. Jonathan Tilove can be reached at jtilove@timespicayune.com or 202.450.1404.