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Mr. FLEMING. Mr. Chairman, I rise today to, again, offer an amendment that would stop a loan program created by the 2009 stimulus bill.
Last year's amendment passed the House by a significant margin, and the administration appeared to get the message, not authorizing any new projects during the fiscal year.
However, in their most recent budget request, they plan to receive and review 100 project proposals, review six business plan proposals, provide technical assistance for the development of four projects, and assist with two projects in the financing phase.
One of the future projects is estimated to cost $1.5 billion for the Federal share alone, which is almost half of the Western Area Power Administration's borrowing authority.
How bad is this program? It is not merely a loan guarantee program, like the one that backed Solyndra. It is an actual loan from the Federal Government, with a built-in bailout mechanism. That's right, built in to the law is this actual bailout.
I am going to quote from what the law says:
If, at the end of the useful life of a project, there is a remaining balance owed to the Treasury under this section, the balance shall be forgiven.
That means we have got agenda-driven, uneconomical renewable energy projects being funded directly by the Federal Government, and if they fail, taxpayers are on the hook once again.
What has been the performance of these projects so far? In November 2011, the Department of Energy inspector general issued a lengthy management alert on the stimulus borrowing authority. To quote from that report:
Because of a variety of problems, the project is estimated to be 2 years behind schedule and $70 million over budget; essentially out of funds; and currently at a standstill, with no progress being made. Western had not completed a formal root-cause analysis and corrective action plan designed to ensure more effective program safeguards are in place going forward. Because Western has committed $25 million in developmental funding to a potential $3 billion project that could ultimately require an investment of $1.5 billion in Recovery Act borrowing authority, we are issuing this report as a management alert.
That is why last year's Republican budget noted:
The $3.25 billion borrowing authority in the Western Area Power Administration's Transmission Infrastructure Program provides loans to develop new transmission systems aimed solely at integrating renewable energy. This authority was inserted into the stimulus bill without the opportunity for debate. Of most concern, the authority includes a bailout provision that would require American taxpayers to pay outstanding balances on projects that private developers failed to repay.
As I and many others have pointed out when the bill was passed, the stimulus--which was billed as funding shovel-ready programs--actually became a vehicle to bake in higher levels of spending and new government programs.
As with other government loan programs, we have all too often seen abuses and mismanagement, and this program is no exception.
Mr. Chairman, I also want to thank my colleagues, Mr. McClintock and Chairman Hastings, for their past work in offering and marking up a bill to repeal this program. I urge my colleagues, again, to support and pass this amendment, and I reserve the balance of my time.
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Mr. FLEMING. Well, my response, Mr. Chairman, is, first of all, there is nothing vague about the billions and billions of dollars that have already been wasted through corporate welfare, giving loans that are guaranteed by the Federal Government, loans to companies such as Solyndra and a whole list of others that now have failed and taken the taxpayer money with them.
Now, with regard to the gentlewoman's claim that programs and projects already in progress would be stopped, well, that is absolute nonsense because those deals have been signed. That money has already been committed.
What we are talking about is stopping any new projects. Again, I would emphasize here that, if these projects made sense--whether it is renewable or nonrenewable, whether it is carbon-based or noncarbon-based, there is plenty of capital out there to lend. There are a lot of people who want to make money on energy. There are a lot of people who have made money on energy.
The reason why there isn't a private market out there primarily is because the government has displaced that private market; and number two, in many cases, when the question is asked--in fact, the President of the United States--why is the government lending this money?
His answer was: well, because you can't get it from the private market and private investors. Why? Because it is a dumb idea. They will never get their money back.
So why in the world do we want to let the taxpayer money go down the tubes when other people, who are a heck of a lot smarter than we are, see that it is unfit for lending and for capital production?
Mr. Chairman, with that, I yield back the balance of my time.
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