Get in line, peon: Solyndra investors to get paid before taxpayers
The House Energy and Commerce Committee released a report today on the Energy Department’s decision to subordinate taxpayers to private investors in the ill-fated Solyndra project. That is, the taxpayers would have to wait in line behind the private investors and let them recoup all of their losses first. Only after that could taxpayers could get any money back – assuming there would be any money to recoup at this point. In this case, that would be a reported $328 million of the $335 million federal loan guarantee to Solyndra.
This is significant because the plain language of the department’s own rules for loan guarantees states that taxpayers must not be subordinate and instead must come first. The committee’s report argues that Energy Department officials made a spur of the moment decision to violate this standard as part of a desperate attempt to keep the company afloat, then scrambled after the fact to justify their action…
Taxpayers getting hosed coming and going.