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Solyndra: An Update

Solyndra: An Update

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Latest Revelations About Solyndra Make It Clear It’s Time For Obama To Take Responsibility For His $535 Million Failure
Latest Revelations About Solyndra Make It Clear It’s Time For Obama To Take Responsibility For His $535 Million Failure

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Published by: Republican National Committee on Oct 10, 2011
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Paid for by the Republican National Committee.310 First Street SE - Washington, D.C. 20003 - (202) 863-8500 - www.gop.com
Not authorized by any candidate or candidate’s committee.
 
September 29, 2011
Solyndra: An Update
Latest Revelations About Solyndra Make It Clear It’s Time For 
Obama To Take Responsibility For His $535 Million Failure
______________________________________________________________________
OBAMA WAS PE
RSONALLY WARNED THAT THE DEPARTMENT OF ENERGY’S LOAN
PROGRAM WAS NOT VETTING ITS LOANS, AND DID NOTHING
Obama Was Personally Warned About The Financial And Political Risks Of The Department Of 
Energy’s Loan Guarantee Program That Aided Solyndra.
“Long bef 
ore the politically connectedCalifornia solar firm Solyndra went bankrupt, President Obama was warned by his top economic advisorsabout the financial and political risks of the Energy Department loan guarantee program that boosted thecompany's rapid asc
ent.”
(Tom Hamburger, Kim Geiger and Matea Gold, “Obama Advisors Raised Warning Flags Before Solyndra Bankruptcy,” 
9/26/11)
NEC Director Larry Summers And Treasury Secretary Tim Geithner Told Obama The Energy
Department’s Loan Guarantee Program Wasn’t Rigorous Enough In Its Selection Process.
 
“At a White
House meeting in late October, Lawrence H. Summers, then director of the National Economic Council, andTimothy F. Geithner, the Treasury secretary, expressed concerns that the selection process for federal loanguarantees wasn't rigorous enough and raised the risk that funds could be going to the wrong companies,including o
nes that didn't need the help.”
 
(Tom Hamburger, Kim Geiger and Matea Gold, “
Obama Advisors Raised Warning Flags Before
Solyndra Bankruptcy,” 
9/26/11)
 
Summers Thought The Government Would Wind Up Funding Flops.
“Not everyone in the
administration agreed. Summers doubted that the government could do this kind of lending well,according to industry and administration officials. He believed the government would end up fundingprojects that would have been built anyway or funding projects that flopped. He resisted efforts to
move money fast.”
(Steven Mufson And Carol D. Leonning, “Some Clean
-Energy Firms Found US Loan-Guarantee Pro
gram A Bad Bet,” 
9/26/11)
In Late 2010, Obama Advisors Drafted A Memo U
rging Obama To Fix The “Broken Process” For Loan
 Approval.
 
“In late October 2010, administration officials took their opposing views directly to Obama. In
preparation, a memo was drafted by
 
Summers, who remained wary of the program, and two others whowere more supportive: then-energy advisor Carol Browner and Ron Klain, then chief of staff to VicePresident Joseph Biden. The memo laid out 
 
their different concerns and options to fix a ‘broken process’ forgetting loans approved.”
(Tom Hamburger, Kim Geiger
and Matea Gold, “Obama Advisors Raised Warning Flags Before Solyndra Bankruptcy,” 
9/26/11)
 
“After The Meeting, Officials W
orked To Streamline The Process But Didn't Make Significant 
Changes.”
(Tom Hamburger, Kim Geiger and Matea Gold, “Obama Advisors Raised Warning Flags Before Solyndra Bankruptcy,” 
 
 
Paid for by the Republican National Committee.310 First Street SE - Washington, D.C. 20003 - (202) 863-8500 - www.gop.comNot authorized by any candidate or candidate
s committee.
2
 
9/26/11)
SOLYNDRA GOT NUMEROUS CARVE OUTS FROM THE OBAMA ADMINISTRATION
Solyndra Received The Lowest Interest Rate Of Any DOE Loan From The Treasury Department.
“The
$535 million loan to Solyndra Inc., issued by the U.S. Department of Treasury's Federal Financing Bank,included a quarterly interest rate of 1.025 percent, the government bank reported in July. Of 18 Energy
Department loans cited in the bank's report, Solyndra's rate was lowest.”
(Ronni
e Greene And Matthew Mosk, “'Connected'Energy Firm Got Lowest Interest Rate on Government Loan,” 
9/7/11)
 
The IRS Gave Solyndra Customers A 30 Percent Tax Deduction.
 
“Solyndra, not only received a $500
million loan guarantee, it also got a favorable ruling from the IRS. According to
California Watch
-- a unit of the Center For Investigative Reporting -- the IRS decision gave Solyndra's customers a 10-percent tax
deduction and it was later increased to 30 percent.”
(“Solyndra Got A Favorable Ruling From IRS,” 
9/27/11)
 
 
“And The Timing Of The Ruling, Jus
t Weeks Before Getting The Stimulus Loan, Raises
Questions About Whether The White House Pulled Strings For Solyndra, At Other Agencies.”
(“Solyndra Got A Favorable Ruling From IRS,” 
9/27/11)
 
 AND SOLYNDRA WAS SPENDING LIKE THEY HAD AN ENDLESS WELL OF CASH
Former Solyndra Employees Saw “Questionable Spending.”
“Former employees of Solyndra, the
shuttered solar company that exhausted half a billion dollars of taxpayer money, said they saw questionablespending by management almost as soon as a federal agency approved a $535 million government-backedloan for the start-
up.”
(Carol D. Leonning And Joe Stephens, “
Solyndra Employees: Company Suffered From Mismanagement, He
avy Spending,” 
9/21/11)
Solyndra’s $733 Million Factory Had “Robots That Wh
istled Disney Tunes, Spa-
Like Showers … And
Glass-
Walled Conference Rooms.” “
When it was completed at an estimated cost of $733 million, includingproceeds from a $535 million U.S. loan guarantee, it covered 300,000 square feet, the equivalent of fivefootball fields. It had robots that whistled Disney tunes, spa-like showers with liquid-crystal displays of thewater temperature, and glass-
walled conference rooms.”
(Alison Vekshin And Mark Chediak, “Solyndra’s $733M Plant Had Robots,Spa Showers,” 
9/28/11)
 
“The Plant Features 19 Loading Docks, Four Electric Car Charging Stations In The Parking Lot 
 And Landscaping Of Wild Gr
ass And A Rock Garden.”
(Alison Vekshin And Mark Chediak, “Solyndra’s $733M Plant HadRobots, Spa Showers,” 
9/28/11)
 
“The Factory Stands As Emblematic Of Money Misspent.”
 
“Amid the still
-unfolding postmortems, thefactory stands as emblematic of money misspent and the Field of Dreams ethos that seemed to drive theventure, said Ramesh Misra, a solar-industry analyst in Los Angeles
for Brigantine Advisors.”
(Alison Vekshin And
Mark Chediak, “Solyndra’s $733M Plant Had Robots, Spa Showers,” 
9/28/11)
“‘After We Got The Loan Guarantee, They Were Just Spending Money Left And Right,’ Said FormerSolyndra Engineer Lindsey Eastburn.”
 
(Carol D. Leonning And Joe Stephens, “
Solyndra Employees: Company Suffered From
Mismanagement, Heavy Spending,” 
9/21/11)
 
 
Eastburn: “Because Of That Infusion Of Money, It Made People Sloppy.”
(Carol D. Leonning And Joe Stephens,
“Solyndra Employees: Company Suffered From Mismanagement, Heavy Spending,” 
9/21/11)
With The Loan Money Solyndra Built A “Seven
-
 Acre Factory” And Bought Custom
-Made Tools From ADutch Company.
“With the loan guarantee in hand, Solyndra built a second, seven
-acre factory with 19loading docks. As part of the expansion, Gronet and fellow managers hoped to cut costs by speeding up theautomated assembly. To do so, they bought a custom-made assembly tool from VDL, a Dutch company. Thecompany had never built that kind of equipment, but it promised the assembly tool would arrive in the
 
 
Paid for by the Republican National Committee.310 First Street SE - Washington, D.C. 20003 - (202) 863-8500 - www.gop.comNot authorized by any candidate or candidate
s committee.
3
 
summer of 2010.”
(Carol D. Leonning And Joe Stephens, “Solyndra Employees: Company Suffered From Mismanagement, Heavy Spending,” 
9/21/11)
 
 
Solyndra Decided It Did Not Want To Use Available Space, But Needed A New Factory.
 
“‘Therewas available space that we talked about with them,’ Bob Wasserman, Fremont’s mayor, said in aninterview. ‘It was their decision that they needed a new building. Was that a good decision? It didn’t turn out to be.’”
(Alison Vekshin And Mark Chediak, “Solyndra’s $733M Plant Had Robots, Spa Showers,” 
 
 , 
9/28/11)
 
The New Plant Was Built In “The Epicenter Of Some Of The Priciest Real Estate In TheCountry.”
“Commercial real
-estate agents in the region wondered why a new factory was being built in the Silicon Valley region, the epicenter of some of the priciest real estate in the country, wheremost new construction consists of 
office space.”
 
(Alison Vekshin And Mark Chediak, “Solyndra’s $733M
Plant Had Robots, Spa
Showers,” 
 
9/28/11)
 
IN 2010, SOLYNDRA DEFAULTED ON THEIR LOAN, AND BROKE THEIR AGREEMENTWITH THE GOVERNMENT
Solyndra Technically Defaulted On Its Government Loan In Late 2010, Violating Their Loan Agreement.
 
“Solyndra LLC had such steep financial problems in late 2010 that the company violated terms
of its loan-guarantee agreement with the Department of Energy and technically defaulted on its $535 million
loan, according to people familiar with the matter.”
 
(Deborah Solomon, “Solyndra Said To Have Violated Terms Of Its US Loan,” 
9/28/11)
 
 
Solyndra Failed To Pay A $5 Million Payment In December 2010
. “The failed solar
-panel maker,which is under numerous criminal and congressional investigations, ran so short of cash inDecember 2010 that it was unable to satisfy certain terms of its U.S. loan agreement, these peoplesaid. The agreement required Solyndra to provide $5 million in equity to a subsidiary building itsfactory but cash-flow problems p
revented those payments.”
(Deborah Solomon, “Solyndra Said To Have Violated TermsOf Its US Loan,” 
9/28/11)
 
Solyndra’s Default Only
Raising
More Questions About Obama’s Backing Of Solyndra
. “It will likely add
to questions surrounding the Obama administration's backing for the company even as its financial
problems mounted.”
(Deborah Solomon, “Solyndra Said To Have Violated Terms Of Its US Loan,” 
9/28/11)
 
But The Obama Administration Ignored The Glaring Red Flags And Allowed Taxpayers To Take A Back Seat During The Loan Restructuring In 2011
Obama’s Department Of Energy Made The Decision To “Waive Its Privilege As First Creditor” In
Solyndra Loan.
“That decision in February gave Solyndra a tem
porary reprieve and a chance to survive,but it also forced the government to waive its privilege as first creditor in the event of a bankruptcy
 
which then occurred at the end of August.”
(Matthew L. Wald, “Questions Raised Over Letting Another Lender Help A Failing Solar Company,”
,9/16/11)
 
 And Allowed Taxpayers To Take A Backseat To An Investment Company Backed By An ObamaDonor.
 
“Complicating the politics of the situation for the Obama administration, part of the new loan came
from Argonaut, the investment company backed by George Kaiser, an Oklahoma oil billionaire who is anObama campaign contributor. Argonaut was already heavily invested in Solyndra, and provided another $69
million in cash in exchange for taking over $75 million that Solyndra was owed by its customers.”
(Matthew L.
Wald, “Questions Raised Over Letting Another Lender
 
Help A Failing Solar Company,
 
,9/16/11)
Even Though They Knew That It Would Cost Taxpayers More In The End If They Restructured Than If They Let Solyndra Go Under In January 

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