Grassley, Thune Want Answers on $529M Loan to ‘Troubled’ Luxury Hybrid Firm
April 23, 2012 - 4:15 pm
Two senators want answers from the Obama administration about a $529 million federal loan for advanced technology vehicles manufacturing to a company now described as “troubled.”
Sens. Chuck Grassley (R-Iowa) and John Thune (R-S.D.) are also asking why taxpayer money went to fund research for a plug-in hybrid car that retails over $100,000 and is built in Finland.
The Republicans sent a letter to Energy Secretary Steven Chu on Friday, noting that even though the DOE has now frozen the remaining part of Fisker’s loan, “questions remain as to why a loan was extended to this now ‘troubled’ auto company in the first place.”
“The statute which created the ATVM program did not specify a retail price range for vehicles that are financed by Federal dollars, but it would seem questionable how financing $100,000 luxury class automobiles would be the best use of taxpayer money,” they wrote. “The Department of Energy appears to have decided otherwise.”
Grassley and Thune asked Chu to provide answers to a number of questions about the loan, including how the DOE arrived at its job creation estimates and about the DOE’s proclamation that its loan to Fisker would result in the equivalent of 30,000 fewer cars on the road.
“It’s important to know what went into the Energy Department’s decision to fund the production of expensive luxury vehicles,” Grassley said in announcing the inquiry. “The riskiness of loans to companies that may or may not be able to pay them back deserves scrutiny.”
There seems to be a troubling pattern developing at the Department of Energy when it comes to providing taxpayer-backed government loans to private companies,” Thune said. “Taxpayers have a right to know why their hard-earned money was used in part to back the production of luxury automobiles overseas, especially in a manner that might not have undergone proper review.”