It’s Unprecedented!™

The structure of the Solyndra loan was a brand new way to rip-off taxpayers

Two senior Treasury officials said Friday that they had never seen a loan restructuring similar to an Energy Department loan to a failed solar panel maker.
In this Sept. 23, 2011 file photo, CEO Brian Harrison of the bankrupt solar energy company Solyndra invokes his Fifth Amendment right to avoid self-incrimination as he appears before the the House Energy Commitee’s Oversight and Investigations Subcommittee which is examining Solyndra’s government loan, on Capitol Hill in Washington.

The half-billion dollar loan to Solyndra Inc. was restructured earlier this year so that private investors moved ahead of taxpayers for repayment on part of the loan in case of a default.

Treasury officials Gary Grippo and Gary Burner told a House committee they had never seen that occur in a federal loan. Grippo is a deputy assistant treasury secretary and Burner is chief financial officer at the Federal Financing Bank, which made a $528 million loan to Solyndra in 2009.

The two Treasury officials stopped short of declaring the loan restructuring illegal, as some Republicans allege.

“I can’t give you a legal interpretation on that, sir,” Burner told Rep. Cliff Stearns, R-Fla.

Grippo, who oversees the financing bank, said it was not Treasury’s job to make legal interpretations. Instead, he said Treasury officials correctly raised questions about the deal in a series of emails and memos.

“Our role is to be as helpful as we can,” Grippo told the House Energy and Commerce Committee Friday.

Hours later, the panel’s Republican majority released an email showing that a White House budget official also questioned the loan restructuring.

I was torn about the title of this post. Should I have called it The Most Transparent Administration Evah Makes A Very Large Loan, And Taxpayers Lose? Or is that too long? What do you think?

- Aggie

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