$25 Billion Federal Loan Fund for Green Car Manufacturing Still Untapped

$25 Billion Federal Loan Fund for Green Car Manufacturing Still Untapped

By John O'Dell February 27, 2009

Is the Advanced Technology Vehicles Manufacturing Incentive Program a good measure of how quickly Uncle Sam will be able to push badly needed federal dollars into the U.S. economy?

Let's hope not.

According to The New York Times, the program that Congress created in 2007 has yet to allocate any of the $25 billion that is available to help push production of electric-powered and other advanced technology, fuel efficient vehicles.

"Some members of Congress are starting to ask why the Energy Department money is not flowing yet," The Times said.

So is the ATVMIP another example of federal bureaucracy at its worst.

Not necessarily.

The program wasn't funded until September 2008, and DOE reports that 43 of the initial applications landed during the final three days leading up to a December 31, 2008 deadline.

ATVMIP's dozen or so full- and part-time employees are wading through applications, some of which are as long as 1,000 pages and detail complex financial and technological issues. The 75 proposals seek a cumulative $38 billion in funding.

DOE also reports that only 25 of the 75 proposals were "substantially complete" -- a measure that qualified them for the next level of a four-part review.

The Times quotes Lachlan W. Seward, the program director, as saying that "We're moving with a sense of urgency ... but at the same time we are trying to do this in a responsible way that reflects prudent credit policy and taxpayer protections."

GM and Chrysler have applied for a combined $13 billion. But the program is limited to companies and projects deemed "financially viable" and the two automakers won't learn until the end of March whether the Obama administration considers their restructuring plans to be financially viable.

Elon Musk, chairman of electric car manufacturer Tesla Motors, has said that his company has been told by the program that funds could start flowing late this summer if its application -- which did pass the first hurdle -- is approved.

Greg Johnson, Contributor

John O'Dell:  is an AutoObserver Senior Editor. Follow @AutoObserver on Twitter.