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‘Soylyndra in Miniature’: TN Truck Stop Given $424,000 in Stimulus Funds Goes Broke


"The EPA did not require financial or criminal background checks or information to be disclosed on grant applications."

A Tennessee company called Mountain Plaza Inc. that received $424,000 in a stimulus fund grant has gone completely broke.

The grant was approved by both the Environmental Protection Agency (EPA) and the Tennessee Department of Transportation (TDOT) for the construction of electrical hookups at a truck stop in Dandridge, TN, "so that truckers wouldn’t have to burn diesel fuel while resting," reports Fox News Insider.

In other words, thoughts of clean energy and environmental friendly trucks stops most likely influenced the awarding of the grant.

But wait! It gets better.

The company qualified for the taxpayer-funded stimulus grant even after it had filed for bankruptcy. Yes, bankruptcy.

The Nashville Business Journal reports:

The truck stop’s owners . . . filed for bankruptcy protection during the process of receiving the federal funds.

. . . the truck-stop owners filed for bankruptcy on June 3, 2010, after being sued by U.S. Bank for failing to pay a $2 million loan. The stimulus grant was awarded 12 days later.

Mountain Plaza received their grant award letter in December 2009. On May 18, 2010, contracts were executed, and TDOT sent them to the Tennessee Department of Finance & Administration, reports The Tennessean.

As mentioned in the above, it was on May 24, 2010, that U.S. Bank sued Mountain Plaza, Lewis, and his wife for failure to repay $2 million in loans they had taken out to finance the truck stops.

Mountain Plaza Inc. filed for bankruptcy on June 3, 2010, and the stimulus award to Mountain Plaza Inc. was officially awarded 12 days later despite the lawsuit, bankruptcy, and all the other financial red flags.

Both TDOT and the EPA were apparently unaware that owner Rick Lewis had a history of legal and financial problems and that he had filed for bankruptcy, reports Fox.

“It is Solyndra in miniature,” said Rep. Phil Gingrey (R-GA), referring to a Silicon Valley solar panel manufacturer that filed for bankruptcy shortly after receiving a $535 million loan guarantee from the U.S. Department of Energy, in the Fox report.

“What I am questioning is the vetting and oversight and the fiduciary responsibility that the federal government — the people who run these programs — have to we the taxpayer,” he said.

Maybe someone could make the argument that, like Solyndra, investing in electric hookups was a "safe bet:"

Even before his latest bankruptcy filing, Lewis had a history of financial troubles. He also filed for bankruptcy in 2003, a year after a conviction on 31 counts of theft.

And Lewis currently faces indictments for allegedly writing worthless checks, according to court records.

Scratch that.

But let's forget about his history of financial troubles; Lewis had some very recent financial issues that should have alarmed the EPA and TDOT:

. . . debts included $18,000 owed to the Internal Revenue Service, $5,000 owed to the Tennessee Department of Labor and Workforce Development, $35,000 owed to the Tennessee Department of Revenue and $17,312 owed to the Jefferson County Trustee, according to the bankruptcy petition.

How could something like this happen? Well, according to Brandon Gee of The Tennessean, TDOT spokeswoman B.J. Doughty said that the "EPA did not require financial or criminal background checks or information to be disclosed on grant applications."

Also, as The Tennessean postulates, the fact that Mountain Plaza Inc. was located in Jefferson County, an area that the EPA has designated "as one where air quality is not always healthy," probably helped to rush the application through.

TDOT officials are claiming that the Mountain Plaza Inc. case was "unusual," and that they are going to improve the screening process for future grant applicants. Furthermore, TDOT officials have stressed that the department was "simply passing along the federal grant funds it had applied for and that no state money was involved," reports The Tennessean.

Watch The Tennessean news brief:

On Oct. 4, the expensive taxpayer-funded equipment that was previously collecting dust became the possession of U.S. Bank as "the bankrupt business after an auction at the Jefferson County Courthouse failed to solicit a single bid," according to the timesfreepress.com

Brandon Gee of The Tennessean sums it up:

While not as spectacular a flop as Solyndra — the California solar panel manufacturer that filed for bankruptcy last month after receiving a $535 million guarantee from the federal government — the truck stop’s collapse further illustrates flaws in the way stimulus projects were evaluated that extended to the state level.

See the whole report here.

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