The Center for Public Integrity

As it scrambled to save the flagship company of the Obama administration's green energy program, the Energy Department ignored repeated warnings from top Treasury Department officials that it was not following guidelines in refinancing Solyndra's half-billion dollar federal loan, a Congressional hearing Friday revealed.

When the DOE refinanced the government's $535 million loan to the California solar panel manufacturer in February, it agreed to let investors, including a major Obama fundraiser, stand in line before the public to recoup the first $75 million of their investment should the company fail. Solyndra declared bankruptcy six weeks ago.

During a House Energy and Commerce hearing on the refinancing of the loan Friday, Rep. Cliff Stearns, R.-Fla., chairman of the Committee's Oversight and Investigations Subcommittee, asked Treasury Department CFO Gary Burner if he had ever seen another case where taxpayer money was subordinated to that of investors.

"No sir, I have not," said Burner, who has been with the department for 28 years, becoming chief financial officer five years ago.

Internal Treasury Department documents released by the committee also show that officials warned DOE and the White House about the refinancing.

The Office of Management and Budget also raised questions, emails show. In December 2010, as DOE moved to restructure the loan, an OMB official wrote: “There are some questions at the staff level about how DOE is going about the restructuring for Solyndra. At least one involves the legal question of what [the statute] means for their plan to make some of the debt “junior” to the new debt. … I think they have stretched this definition beyond its limits.”

The CEO of Solyndra, a California-based solar energy company that received a controversial $535 million loan guarantee from the Obama administration, has resigned.

In papers filed with a bankruptcy court Wednesday, Solyndra said that Brian Harrison had left his post on Friday, Oct. 7, "as contemplated even before these cases were commenced." Solyndra shut its doors and declared bankruptcy six weeks ago.

Solyndra filed the papers in a Delaware court in response to a motion by the Department of Justice to appoint a trustee to oversee the company's bankruptcy case. The Justice Department filed its motion after Harrison and Solyndra's CFO, W.G. Stover invoked the Fifth Amendment and refused to answer questions from a Congressional committee probing the Solyndra loan during a Sept. 23 hearing. The company is also under investigation by the Justice Department, the Treasury Department and the Department of Energy's Inspector General.

The Obama administration had selected Solyndra as the first to receive a loan under an Energy Department program designed to provide government support to companies that would create jobs while generating energy from cleaner sources, such as solar, wind and nuclear. President Obama personally visited the Solyndra complex, hailing it as a leader in this emerging field.

In August, though, Solyndra abruptly shut its doors, laying off 1,100 workers. Within days, it had declared bankruptcy. The House Energy and Commerce Committee's investigative subcommittee has held two hearings intending to unwind the deal and understand how signs of Solyndra's financial trouble had been overlooked by the Department of Energy.

Another hearing is planned Firday morning, when the committee will explore concerns that DOE refinanced the loan — putting investors in line before taxpayers — without approval from the U.S. Treasury Department. The committee has called Treasury officials to testify.

An American Crossroads TV ad claims Obama’s position on taxes is “different” than it was in 2009. It isn’t.

The conservative group began airing a new TV ad in St. Louis on Oct. 3 in advance of the president’s fundraising trip to Missouri. The ad, titled “Don’t,” urges Obama not to raise taxes. But it distorts the president’s position on taxes two years ago by taking a snippet of an Obama interview in August 2009 and using it out of context.

Announcer: "He raised our hopes. He seemed to understand."

Obama: "The last thing you want to do is raise taxes in the middle of a recession."

Announcer: "But today he’s different."

Brianna Keilar, CNN: "The president proposes tax increases..."

Scott Pelley, CBS: "One and a half trillion dollars..."

Does the $1.5 trillion tax hike plan contradict what Obama said in 2009 about raising taxes “in the middle of a recession”? Is it true that “today he’s different”? No and no.

The $1.5 trillion tax hike proposal — which is spread over 10 years, a point not mentioned in the ad — is included in the deficit reduction plan he submitted Sept. 19 to the Joint Select Committee on Deficit Reduction. The special committee was formed this summer as part of the bipartisan agreement to raise the nation’s debt limit.

Sen. Charles Grassley is putting pressure on wireless company LightSquared to make public all records of its contacts with White House aides as it sought to set up a national broadband network.

The Iowa Republican wants to know if campaign contributions to Democrats influenced a decision by the Federal Communications Commission to grant initial government approval to the company’s plans in late January despite fears its network could interfere with global positioning systems, posing dangers to aircraft, military operations and search and rescue missions.

In two letters sent Wednesday to LightSquared and its hedge fund owner, Philip Falcone, Grassley asked both to voluntarily turn over records of all communications with government officials. Falcone is head of Harbinger Capital Partners.

“If Harbinger has nothing to hide and would like to put questions of improper influence at the FCC, Department of Commerce, and White House to rest, the public release of these communications would allow Congress and the American people to fully examine the facts and decide for themselves,” Grassley wrote. “Incomplete information about this project only undermines public confidence in the FCC’s decision to allow this project to move forward.”

LightSquared spokesman Terry Neal said, “We received the letter and we are reviewing it.” Grassley’s letters to the companies were first reported by the Wall Street Journal.

Last month, House Republicans launched a broad investigation into White House ties to campaign donors seeking government contracts, loans and other benefits, including LightSquared, whose employees made large contributions to Democrats while gaining access to presidential aides.