WASHINGTON, DC - The Subcommittee on Oversight and Investigations, chaired by Rep. Tim Murphy (R-PA), today held a hearing to examine recent developments and the current status of the Department of Energy's loan programs, including the Section 1703 and Section 1705 loan guarantee programs and the Advanced Technology Vehicles Manufacturing (ATVM) loan program. Members questioned witnesses from DOE and the Government Accountability Office about reforms to the programs, efforts to improve management and oversight, and the Department's announced plans to grant additional loans with its remaining $40 billion dollars of existing loan authority. The efforts by DOE come about after a string of loan failures like Solyndra, Fisker Automotive, and A123 Systems.
Chairman Murphy commented, "Today, we will take a measure of what DOE has accomplished, and what more it should do to protect taxpayer interests. This oversight is particularly important because, as the agency transitions focus to portfolio management, it has in recent months launched new initiatives to generate more loans and loan guarantees."
Peter Davidson, Executive Director of the Loan Programs Office at DOE, testified on the DOE's current loan portfolio and plans for expansion. He also explained reforms the department has made over the past two years in response to identified management failures and taxpayer losses like Solyndra. In the past month, the Government Accountability Office and the DOE Inspector General have issued reports evaluating DOE's management of its loans. The reports indicate DOE has made some progress in its oversight of the loan programs but problems still remain.
Frank Rusco, Director of Energy and Science Issues at GAO, testified on the government watchdog's recent findings. "We found DOE has not fully developed or consistently adhered to loan monitoring policies for its loan programs. In particular, DOE has established policies for most loan monitoring activities, but policies for some of these activities--for example, for evaluating and mitigating program-wide risk--remain incomplete or outdated," said Rusco.
DOE Deputy Inspector General for Audits and Inspections Ricky Hass reported the IG's findings regarding management problems and lessons learned from of the Abound loan guarantee - one of DOE's string of bankruptcies - and implementation of recommendations from the January 2012 report by Herbert Allison to improve the program. Hass testified that DOE has taken steps to implement only some of the recommendations and that there are still opportunities for improvement. Hass stated, "Given the significant amount of additional funding being made available for loan guarantees and previously identified weaknesses in the program, we will continue to monitor its activities as part of our normal risk assessment process. In our view, the Loan Guarantee Program warrants special attention by Department officials and, therefore, has been one of our 'watch list' items since 2011."
Read this original document at: http://energycommerce.house.gov/press-release/subcommittee-continues-oversight-taxpayer-dollars-receives-status-update-doe%E2%80%99s-loan