Solyndra: Energy Department pushed firm to keep layoffs quiet until after midterms
Tuesday, November 15, 2011
Solyndra: Energy Department pushed firm to keep layoffs
quiet until after midterms
By: Carol D. Leonnig and Joe Stephens, The Washington
Post
The Obama administration urged officers of the struggling solar
company Solyndra to postpone announcing planned layoffs until after
the November 2010 midterm elections, newly released e-mails
show.
Solyndra, the now-shuttered California company, had been a
poster child of President Obama's initiative to invest in clean
energies and received the administration's first energy loan of
$535 million. But a year ago, in October 2010, the solar panel
manufacturer was quickly running out of money and had warned the
Energy Department it would need emergency cash to avoid having to
shut down.
The
new e-mails about the layoff announcement were released Tuesday
morning as part of a House Energy and Commerce committee memo,
provided in advance of Energy Secretary Steven Chu's scheduled
testimony before the investigative committee Thursday.
Solyndra's chief executive warned the Energy Department on Oct.
25, 2010, that he intended to announce worker layoffs Oct. 28. He
said he was spurred by numerous calls from reporters and potential
investors about rumors the firm was in financial trouble and was
planning to lay off workers and close one of its two plants.
But in an Oct. 30, 2010, e-mail, advisers to Solyndra's primary
investor, Argonaut Equity, explain that the Energy Department had
strongly urged the company to put off the layoff announcement until
Nov. 3. The midterm elections were held Nov. 2, and led to
Republicans taking control of the U.S. House of
Representatives.
"DOE continues to be cooperative and have indicated that they
will fund the November draw on our loan (app. $40 million) but have
not committed to December yet," a Solyndra investor adviser wrote
Oct. 30. "They did push very hard for us to hold our announcement
of the consolidation to employees and vendors to Nov. 3rd - oddly
they didn't give a reason for that date."
Solyndra has become a rallying cry for Republicans who argue
Obama used his clean energy initiative to steer valuable loans to
benefit his friends and donors. Argonaut is a private equity firm
of George Kaiser, who advised his investor deputies on how to
approach the White House to help Solyndra with its financial
problems.
Earlier in October, Solyndra executives and its investors had
warned the agency that they needed emergency financing to keep the
company operating after December, and were working with the agency
to restructure and ease the terms of its half-billion-dollar
federal loan.
On Oct. 25, 2010, Solyndra chief executive Brian Harrison
e-mailed the energy department's loan staff to explain that
Solyndra "has received some press inquiries about rumors of
problems (one of them with quite accurate information) and we have
received in bound calls from potential investors. Both of these
data points indicate the story is starting to leak outside
Solyndra."