Here are the 4 reasons the Bush admin declined to give a loan to Solyndra

No, Bush Really Didn’t OK The Solyndra Loans
By Sean Higgins
Fri., Sept. 23, 2011 8:35 PM ET

A key part of the Democrats’ pushback over the Solyndra scandal has been to spread the blame. They argue that the $527 million in loan guarantees made to the now-bankrupt solar panel company were just as much the doing of the George W. Bush administration as they were of the current administration.

This argument has been pushed repeatedly by the Democrats on the Energy and Commerce committee, by liberal groups like Media Matters and even by the Energy Department itself, which has been emailing reporters regular press releases spinning the scandal.

For example, Rep. Diana DeGette, D-Calif., ranking Democrat on the House Energy and Commerce investigation subcommittee, asked Friday, “Whether the Bush and Obama administration conducted due diligence on the loan guarantee.”

But the facts don’t justify this claim. The bottom line remains that the Bush Administration did not approve the Solyndra loan guarantee. And just before they headed out of town, Bush officials ordered the project back to the drawing board.

Democrats argue the Energy Department first received the loan request in December 2006. By January 2009, it was still under consideration. That month, the department’s Loan Guarantee Credit Committee put the project on hold.

In a terse one-page memo, dated Jan. 9, 2009, the committee noted that the “apparent haste in recommending the project meant that certain LGPO (Loan Guarantee Program Office) credit procedures were not adhered to.”

It further stated that: “While the project appears to have merit, there are several areas where the information presented did not thoroughly support a finding that the project is ready to be approved at this time.” It then cited four areas of concern.

First was the lack of any “independent market study addressing long-term prospects for this specific company.” An independent credit assessment had “raised the issue of obsolescence in marketing this project.” Obsolescence? That’s never a good word to hear in a product marketing study.

Second, it noted that the committee had never seen a supposed sales agreement the company had for its product even though an unnamed “outside legal advisor” had. In other words, the committee only had vague assurances that there was even a buyer for the product.

Third, it noted, “There are questions regarding the nature and the strength of parent guarantee for completion of the project.” In other words, the committee wasn’t convinced the project would even be finished.

Fourth and finally, it vaguely noted “concern” over production start “scale-up” at a second Solyndra facility.

The memo concludes by saying “the number of issues unresolved makes a recommendation for approval premature at this time” and sent the project back to the LGPO for “further development of information.”

That strikes Capital Hill as a pretty damning — not to mention prescient — analysis of the Solyndra loan proposal. The loan wasn’t ready and Bush’s Energy Department wasn’t going to approve it. If Solyndra had proved to be a success, green energy fans would today probably be claiming the Bush White House had dragged its feet and endangered the project.

At the very least it shows that the Bush administration was doing the “due diligence” that DeGette questioned.

The one thing the Bush administration did not do was kill the project outright and it is on that one thin reed that Obama administration officials and their allies have made their case.

Here’s how DOE spokesman Damien LaVera put it in an email to reporters:

On January 9, 2009, a Credit Committee of five career federal employees reviewed the progress of the Department’s due diligence on the transaction. The group decided to continue the due diligence process rather than recommend the loan guarantee immediately proceed for further approvals. As the (documentation) from that meeting makes clear, the committee did not reject the application. It noted that the project “appears to have merit” and simply remanded the application “without prejudice” so that work could continue and so that the committee would have additional time to review the documentation.

Note the complete absence of any of the committee’s criticisms of the project in his statement.

What happened next in the loan was that by mid-March of 2009 the project was sailing through. LaVera stated in his email that, “This is just a case of responsible career federal employees who wanted a bit of extra time and information to make their decision.”

Yes, but something else changed in the intervening two months: A new administration came in. As the New York Times reported Friday:

The Energy Department’s senior staff has acknowledged in interviews the intense pressure from top Obama administration officials to rush stimulus spending out the door.

“We had to knock down some barriers standing in the way to get these projects funded,” Matthew C. Rogers, the Energy Department official overseeing the loan guarantee program, said in March 2009, just days before Solyndra got its provisional loan commitment. Mr. Rogers said Energy Secretary Steven Chu had been personally reviewing loan applications and urging faster action on them.

There were two administrations involved in this project. One, after more than two years of consideration, was still sending it back for further review. That was the Bush administration. The second was placing “intense pressure” on department staff to approve loans from the moment it walked in the door and even had the energy secretary himself personally reviewing each loan. That was the Obama administration.