FBI agents on Thursday raided the offices of Solyndra, the Obama administration’s flagship alternative energy grantee that the president had hailed as an example of a company that would provide well-paying jobs while helping to point the country to a future less dependent on foreign oil.
“The FBI is still on the site at this time and is executing a search warrant of Solyndra’s Freemont facility in conjunction with the Department of Energy’s Office of the Inspector General,” an FBI spokeswoman told TPM.
The raid comes at an awkward moment for President Obama, who is scheduled to deliver a major speech on jobs and the economy Thursday evening. Solyndra laid off more than a thousand workers at its Fremont, Ca. facility, after receiving more than half a billion dollars in a loan guarantee from the Department of Energy. The company has been running into trouble over the past year or so, pulling out of a planned initial public offering, and refinancing its debt, but it did not indicate the extent of its troubles until it abruptly declared bankruptcy last week.
The raid comes a day after the company participated in a bankruptcy proceeding Wednesday in a Wilmington, Del. court. During those proceedings, a lawyer representing the federal government told a judge that Solyndra should have declared bankruptcy long-ago.
“It’s clear this company should have filed for bankruptcy a long time ago and didn’t,” said Matthew Troy, an attorney for the US Department of Justice, according to a Wednesday Reuters report.
The U.S. Department of Energy issued a loan guarantee to Solyndra, a maker of thin-film solar panels, in 2009 as part of its recovery funding projects. The loan was made three years after the Silicon Valley start-up applied in 2006 under President George W. Bush’s administration.
The problem for U.S. taxpayers now is that they’re third in line for repayment behind private investors who put a billion dollars into the project.
On Wednesday, Solyndra’s lawyer declined to state definitively whether the company had enough value to repay the loan. He also declined to say whether the interested buyers of the remnants of the company are willing to keep it in the United States.
DOJ’s Troy said that the terms of the government’s loan require it to be in the United States.
House Republicans have been investigating the circumstances surrounding the federal government’s signing off on the loan guarantee to Solyndra. They’ve pointed to one of the major investors in the company being a foundation created by Oklahoma billionaire George Kaiser, who was also a major fundraiser for President Obama’s 2008 presidential campaign.
But sources familiar with the recovery act funding process at the DOE say that pressure to fund particular projects didn’t come from the White House at all in 2009. It came, instead, from state governors and members of congress, and that pressure was wholly ignored.
Indeed, a quick scan of the archives surrounding the developments of the funding of Solyndra show that California Governor Arnold Schwarzenegger was one of the company’s biggest boosters, and unlike some other Republicans at the time, he was not shy about stepping up to get recovery funds from the Obama administration.
The Obama administration last week defended its backing of Solyndra, and the DOE noted in a blog post that both the Bush and Obama administrations had worked on the loan guarantee.
“We have always recognized that not every one of the innovative comnpanies supported by our loans and loan guarantees would succeed, but we can’t stop investing in game-changing technologies that are key to America’s leadership in the global economy,” wrote Dan Leistikow, DOE’s director of public affairs in a blog post on the bankruptcy. “These projects, which include more than 40 other companies, are on pace to create more than 60,000 jobs.”
As if to underscore the point, DOE announced on Friday that had awarded $145 million dollars to fund research and development on 69 projects in 24 states to advance solar energy technologies.
Carl Franzen contributed to this report.