Solyndra e-mails: Dept. of Energy was poised to approve $469 million for firm
View Photo Gallery — ?Solyndra, a California solar company backed by a half-billion dollars in loan guarantees from the Obama administration, announced it was shutting its doors and laying off 1,100 employees.
By Carol D. Leonnig, Wednesday, October 5, 12:14 PM
The Obama administration’s Department of Energy was poised last summer to give Solyndra a second major taxpayer loan of $469 million, even as the company’s financial situation was growing more dire.
The Energy Department was actively pushing to provide the second loan guarantee to the troubled solar-panel manufacturer in April and May 2010, when Solyndra’s auditors warned the company was in danger of closing due to its rapidly mounting debts and expenses, according to complete e-mails just released by a House committee investigating the original loan.
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White House career staffers, who had first raised concerns in the fall of 2009 about the Department of Energy providing Solyndra with its first taxpayer-backed loan of $535 million , wrote e-mails in gallows humor in April 2010 about the prospect of giving Solyndra more money. That spring, industry analysts were publicly questioning how the Silicon Valley startup could so quickly be running out both the federal loan and $933 million in private capital.
“Apparently the loan size for Phase II is $469 million,” one Office of Management and Budget analyst wrote of DOE seeking a second loan for Solyndra. The analysts’s name was not released by the committee. “I’ve been told we should expect the see that project soon for conditional commitment.”
Another joked: “Possible to close and default on one before closing on a second??? Could be a new record.”
The agency didn’t shelve the idea for a second loan until October 2010, a Department of Energy spokesman has confirmed. That was the month that Solyndra executives and investors first warned the department that the company was facing the threat of having to liquidate without emergency cash.
Solyndra, which suddenly shut down on Aug. 31 and sought bankruptcy protection, has left taxpayers on the hook for repaying that first half-billion-dollar loan. Its also left many, both Republicans and Democrats, questioning why the Obama administration was so supportive of the startup. Republicans have alleged the administration was showing favoritism to a firm backed primarily by investment funds tied to a major Obama campaign bundler, George Kaiser.
Solyndra, the first clean energy company that the fledgling administration backed with a stimulus-funded loan, had been a showcase of Obama’s effort to spur a clean energy industry on U.S. soil. Obama personally visited the firm in May 2010, after being warned not to go by a donor and adviser in the venture capital field who noted the auditors’ warnings the firm could very likely fail.
Even in May 2010, Energy Secretary Steven Chu’s top advisers — his senior adviser on stimulus , Matt Rogers, and his chief of staff, Rod O’Connor — were telling the White House not to worry about the auditors’ warnings on Solyndra’s finances. They also referenced the need for more federal money for Solyndra.
O’Connor told a top White House adviser to Vice President Biden that the warnings were exaggerated, when a venture capitalist and Obama donor had flagged the company’s finances as a reason the president shouldn’t visit Solyndra as scheduled on May 25. O’Connor also raised the issue of more government support for Solyndra
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