SUBCOMMITTEE LOOKING INTO DOE LOAN PROGRAM, INCLUDING LOAN TO SOLYNDRA, INC.

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Washington, Jun 24 - "For more than three months, we have been seeking documents on the Office of Management and Budget's (OMB's) involvement in the U.S. Department of Energy's (DOE's) loan guarantee program – the refusal of the OMB witness to attend this hearing today underscores the obstacles encountered in this investigation," said Rep. Cliff Stearns (R-FL), Chairman of the House Energy and Commerce Committee's Oversight and Investigations Subcommittee.

Created under the Energy Policy Act of 2005, the DOE's Loan Guarantee Program received $2.5 billion in stimulus funds to pay the credit subsidy costs of companies receiving the loan guarantees. So far, DOE has announced 20 loan guarantee projects totaling over $11 billion in financing. Solyndra, Inc. of California was the first recipient and got $535 million. "However, since receiving the guarantee, Solyndra has suffered numerous financial setbacks, and Solyndra's own auditor noted the company's ‘recurring losses' and ‘negative cash flows,'" explained Stearns. "In November of 2010, Solyndra announced the closing of its older manufacturing facility, resulting in the layoff of 135 temporary employees and about 40 full-time employees."

The Committee's investigation found that OMB plays a key role in approving DOE loan guarantees and it requested a briefing and documents on the Solyndra guarantee from OMB Director Jacob Lew on March 14, 2011. More than three months later, OMB has yet to respond fully to this request.

In order to move the investigation forward, Stearns called OMB Deputy Director Jeffrey Zients, today's witness, seeking an agreement on the documents. "I even offered that Committee staff would conduct an in camera review in which the documents are only reviewed and only those pertinent to the investigation are taken," added Stearns. "Although Zients agreed to have a briefing and provide the requested documents, OMB violated our agreement and again failed to provide the agreed upon documents relating to Solyndra."

Concluded Stearns, "After repeatedly frustrating this investigation, our witness for today's hearing, Jeffrey Zients, refused to attend. After consultation with the Democrat members of the Committee, they agreed to assist us in the investigation and obtaining the documents. If this latest efforts fails in getting OMB's full cooperation then the Committee is prepared to issue a subpoena. We have an obvious oversight responsibility in understanding how OMB and DOE carried out their roles with respect to approving over $11 billion in financing, and whether they properly weighed the risks presented by these guarantees, and the Solyndra guarantee in particular."