Press Releases

Today the House Committee on Oversight and Government Reform’s Subcommittee on Economic Growth, Job Creation and Regulatory Affairs held a hearing on “Green Energy Oversight: Examining the Department of Energy’s Bad Bet on Fisker Automotive.” Below is Ranking Member Cartwright’s statement on the hearing.

The Department of Energy’s Advanced Technology Vehicles Manufacturing loan guarantee program was created under President Bush and has received widespread support from both Democratic and Republican Administrations and Members of Congress.  The program was structured to invest in U.S. companies and technologies that improve the fuel economy of vehicles, promote economic growth and job creation in the U.S., and protect taxpayer dollars.

The ATVM program provided most of its funds to Ford, which today markets highly efficient and successful electric and Eco-Boost engines made in Lima, Ohio and several other U.S. facilities.

The success of the Ford loan was replicated with the overwhelming majority of funds lent by the Department of Energy: $1.4 billion went to Nissan North America, which in 2012 reported a record breaking year in sales, and $465 million to Tesla, which is on course to repay its loan early.

In fact, 98% of the loan guarantees awarded in this program appear to be on track to be repaid.

Today’s hearing seems to ignore those considerable successes.  Instead we are focusing on a $192 million loan made to Fisker Automotive.  I absolutely believe there should be Congressional oversight of these programs, and I look forward to this discussion, but I would just like to point out the cherry picking that is going on here, and that has been going on in the oversight of the Loan Program Office.

All the evidence before us indicates that DOE protected taxpayers in implementing the ATVM program, and DOE followed the same rigorous due diligence procedures in awarding the Fisker loan as it did in awarding the Tesla loan, the Nissan loan and the Ford loan.

Unfortunately, the Fisker loan is clearly not working out.  But Congress, in creating this program, expected that some loans would not work out as hoped, and Congress appropriated $7.5 billion to cover potential losses in the loan portfolio.

And DOE protected taxpayers once the loans were made.  Financial controls and contractual milestones on the release of funds were built into every deal to minimize the taxpayer loss on these loan guarantees.  These controls are particularly relevant to Fisker who received a $529 million loan guarantee, but drew down only $192 million of funds.  DOE’s oversight of Fisker’s ability to meet project milestones led to the decision to cut off Fisker’s access to the loan.  Earlier this week, DOE recovered $21 million from Fisker to protect against the loss of those taxpayer dollars. 

In the event the government is unable to receive any return on the Fisker investment, losses would account for just 2% of the $8 billion in loan guarantees awarded in the ATVM. 

If Congress were not such a dysfunctional, partisan place, this hearing would have some perspective on this 2% potential loss.  In the world outside the Beltway, anybody who exceeds expectations 98% of the time gets an A+. 

That’s what the DOE’s performance has been.

All of the evidence this committee has gathered leads to the conclusion that ATVM is working as planned.  DOE implemented ATVM and awarded funds only after rigorous due diligence.  Fisker’s problems were clearly not hoped for, but Congress and DOE planned for the potential of some loans not working out.  In fact, ATVM’s performance has exceeded Congress’ expectations, and only a portion of the funds authorized to Fisker are at risk of loss, if the company fails to find a buyer. 

While I appreciate the opportunity to hear the testimony of the witnesses today, I think the Majority reveals a substantial partisan bias.  I note that nobody from Ford, or Nissan or Tesla was called to testify.  The majority apparently did not want any context and did not want to acknowledge the obvious success of Ford, Nissan, Tesla or the ATVM program as a whole. 

That is really a shame, because the American people should be quite proud of what the ATVM program has achieved.