Bloomberg News

Republicans Want to Question Counsel on Solyndra Loan

October 20, 2011

(Corrects timing of loan renegotiation in ninth paragraph.)

Oct. 20 (Bloomberg) -- House Republicans want to interview the chief counsel for the Energy Department’s loan-guarantee office, under oath, about her legal memorandum supporting a rescue effort for Solyndra LLC, the failed solar-panel maker.

Representative Fred Upton of Michigan, chairman of the House Energy and Commerce Committee, and Cliff Stearns of Florida, who leads the investigations subcommittee, asked in a letter today to Energy Secretary Steven Chu that he make Susan Richardson, the counsel, available for a transcribed interview.

Richardson wrote a Feb. 15 memo declaring legal the restructuring of Solyndra’s $535 million loan guarantee to put taxpayer debt behind $75 million in private investment in case of liquidation. Republicans, who have investigated the guarantee for eight months, say it violated the 2005 energy law establishing the loan program.

The memo supporting the department’s decision is a “matter of particular concern to the committee,” Upton and Stearns wrote in their letter.

The Department of Energy has said while Richardson can be interviewed for a “discussion,” she isn’t willing to be under oath except in testifying before the subcommittee, according to the letter.

“We are therefore puzzled as to why DOE refuses to make her available for a transcribed interview on the same matters, and ask you to reconsider your position,” they wrote.

Four Briefings

Damien LaVera, an Energy Department spokesman, said Richardson has briefed the committee’s staff four times.

“We also offered to work with them to make the appropriate legal staff from the department available to testify under oath before the committee if needed after the briefing,” LaVera said today in an e-mail. Chu told lawmakers he can testify Nov. 1 or Nov. 2, LaVera said. No hearing date has been set for Chu’s appearance.

Energy officials, Solyndra executives and investors began negotiating a new deal in November, before the Fremont, California-based company defaulted on the guarantee by failing to set aside $5 million for a reserve fund in December 2010. Terms were reworked in February.

The law affords “the secretary, in a distressed situation, broad authority to take action that will protect and maximize the interests of the United States,” Richardson wrote.

Republicans point to a clause in the law that states the taxpayer obligation “is not subordinate to other financing.”

--Editors: Steve Geimann, John Lear

To contact the reporter on this story: Jim Snyder in Washington at jsnyder24@bloomberg.net

To contact the editor responsible for this story: Larry Liebert at lliebert@bloomberg.net


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