U.S. Department of Energy Issues Rules for Auto Loan Program

On November 5, 2008, the U.S. Department of Energy issued an Interim Final Rule that implements the Advanced Technology Vehicles Manufacturing Incentive Program authorized by section 136 of the Energy Independence and Security Act of 2007 (EISA). The FY09 Continuing Resolution provided DOE with funding to make up to $25 billion in direct loans to eligible applicants for the costs of reequipping, expanding, and establishing manufacturing facilities in the United States to produce advanced technology vehicles, and components for such vehicles. These vehicles must provide meaningful improvements in fuel economy performance. According to Energy Secretary, Samuel Bodman, “Issuance of the interim final rule opens the process for automakers and component manufacturers to immediately apply for government funding under the Advanced Technology Vehicles Manufacturing Incentive Program. Congress has appropriated $7.5 billion to cover the subsidy costs of direct loans issued to automobile manufacturers and component suppliers under EISA section 136. The actual amount of loans that DOE will be able to issue with this funding, up to the statutory ceiling of $25 billion in loans, will depend on the particular circumstances of specific borrowers and proposed projects. Additionally, the Department must comply with statutory requirements including the National Environmental Policy Act (NEPA) in connection with the issuance of any loans to be made under the EISA section 136 program. The Department intends to act quickly to review and evaluate any applications it receives from eligible applicants under the section 136 program. Details about the loan program can found at DOE’s Advanced Technology Vehicles Manufacturing Loan Program website. For a copy of the Auto Loan Program Final Rule, click here. For assistance obtaining loans through this program, please contact Dale Kardos at Dale Kardos & Associates, Inc. at (202) 742-4415 or dale.kardos@motorvehicleregs.com.