Energy department probes delay of layoff news at Solyndra

The Energy Department’s Office of Inspector General is investigating who pushed to delay bad news about federally backed Solyndra LLC until after the November 2010 midterm elections.

Energy Secretary Steven Chu, who nearly four months ago pledged to find out if anyone in his department was involved, told a House Committee on Thursday he’s turned the matter over to the department’s Office of Inspector General.

Mr. Chu’s comments came in response to questions from Rep. Michael C, Burgess, Texas Republican, during a hearing by the House Energy and Commerce Committee’s subcommittee on energy and power. The House Energy Committee’s investigations panel has been investigating the Energy Department’s 2009 loan guarantee to Solyndra for $535 million for more than a year. The company went bankrupt last year.

Last year, a Republican staff memo from the committee showed that an official at one of the major investors in Solyndra said the Energy Department “did push very hard for us to hold our announcement of the consolidation to employees and vendors to Nov. 3 — oddly they didn’t give a reason for that date.”

The date was one day after the midterm elections. The disclosure fueled talk by Republicans that politics were involved in the Obama administration’s handling of the Solyndra loan. The company was a high-profile beneficiary of President Obama’s stimulus program. Mr. Obama toured the company in 2010, and Vice President Joseph R. Biden made remarks at a company groundbreaking ceremony in 2009.

Mr. Chu was questioned about the layoff timeline at a hearing last year. He said he would not have approved of the delay, adding that “we do have an interest in finding out” who pushed to put off the announcement.

“Well, certainly our general counsel’s office will look at who is doing these things,” he said at the time.

During his testimony Thursday, Mr. Chu said he later turned the matter over to the agency’s inspector general because doing so would provide “an independent look at what happened.” He said he has not been interviewed by the inspector general about the layoff announcement, but said he would cooperate.

Mr. Chu was also pressed on whether any other loan recipients were headed for bankruptcy. He said the department closely monitors companies’ financial health and market conditions, but he declined to discuss any individual recipients because of what he said were confidentiality concerns.

The disclosure about the involvement of the inspector general, an independent agency that investigates fraud and waste, in the Solyndra layoff inquiry came during a hearing covering a broad range of other issues, including rising gas prices.

Mr. Chu said the Obama administration was concerned about the increasing price of gas, but added that there was “no magic bullet.”