Did the Biden administration use so-called ‘climate equity’ to justify handouts of billions of dollars to their far-left friends?

By Madeleine Rowley | The Free Press

“This clearly was intended from its beginning to be a slush fund. The goal was to give them money with minimal strings and allow them to lend it to people they favored. It is an absolutely wild program. I haven’t seen the likes of in previous government-lending history.”—Judge Glock, a senior fellow at the Manhattan Institute and author of The Dead Pledge The Origins of the Mortgage Market and Federal Bailouts, 1913-1939.

Summary

The Greenhouse Gas Reduction Fund, a $27-billion program managed by the United States Environmental Protection Agency (EPA), has come under scrutiny for allocating $20 billion to eight environmental nonprofits with ties to former Obama and Biden administration officials.

Currently under investigation by the Department of Justice, the program is part of Joe Biden’s $740 billion Inflation Reduction Act, established in the spring of 2023 and designed as a pioneering initiative to address climate issues while revitalizing communities that have been historically marginalized.

A Free Press investigation revealed that $20 billion of the $27 billion was hastily allocated to eight nonprofit groups after Kamala Harris lost the election but before President Donald Trump took office. As one former EPA official described it in a secretly recorded video, the rush to get money out the door was akin to “tossing gold bars off the Titanic.”

One recipient includes Power Forward Communities, a coalition which became a registered nonprofit in August 2023, shortly after the Biden administration announced the Greenhouse Gas Reduction Fund application period. Awarded $2 billion, Power Forward includes five nonprofits: Enterprise Community Partners, Local Initiatives Support Corporation, Rewiring America, United Way Worldwide, and Habitat for Humanity. Documents obtained by The Free Press reveal Power Forward Communities employs 22 individuals earning more than $150,000, with CEO Tim Mayopoulos, former Fannie Mae CEO during the Obama administration, earning $810,000.

Other nonprofits include the Climate United fund and Coalition for Green Capital, which received grants ranging from $400 million to $6.9 billion. Again, many of these were formed just before the grant applications went live. Their boards list Democratic donors and prominent Democrats such as Stacey Abrams. These eight groups, along with a few smaller affiliated organizations, are predominantly composed of green banks and housing nonprofits that shifted their focus to climate change in response to the funding priorities of the Biden administration. The nonprofits are tasked with distributing loans, not grants, to smaller organizations for climate projects, with minimal oversight.

New EPA administrator, Lee Zeldin, aims to recover the $20 billion, most of which is frozen in Citibank accounts. However, contracts with the nonprofits contain clauses that could release the funds if recovery is attempted.

House Committee on Energy and Commerce chairman, Brett Guthrie, and EPA acting inspector general, Nicole Murley, have raised concerns about the vetting and monitoring of funding recipients. Concerns include the lack of oversight and the potential for the funds to be misused. Judge Glock, a senior fellow at the Manhattan Institute, predicts significant defaults and scandals if the nonprofits ultimately receive the money.

“The money is certainly down the drain,” Glock told The Free Press. “The plans are focused on lending to very small and low-return projects. But that’s precisely the sort of project that is less likely to pay off and is less likely to make a full return to the lender, and is less likely to make any significant impacts on the client. And they’re going to require an obscene amount of overhead while making a negligible impact on natural emissions.”

Mainstream media has portrayed the investigation into the Greenhouse Gas Reduction Fund as an example of the Trump administration obstructing legitimate climate change efforts while undermining the rule of law. When veteran prosecutor Denise Cheung was instructed to freeze the Citibank accounts and initiate an investigation, she declined, citing insufficient evidence. In her resignation letter, she mentioned prosecutors were investigating potential charges of conspiracy to defraud the United States and wire fraud.

In its report on Cheung’s resignation, The Washington Post noted prosecutors had warned that the Trump administration’s actions lacked adequate evidence or legal basis, constituting a misuse of the Justice Department’s powers. In a follow-up story, asset forfeiture expert Stefan D. Cassella described the government’s attempt to block the release of billions in grants as extraordinary and likely unprecedented.

However, “even a cursory review” of the eight groups that received the $20 billion suggests that such unprecedented measures might be justified, writes The Free Press. At a recent House Committee on Energy and Commerce hearing, chairman Brett Guthrie, a Kentucky Republican, said some funding recipients were led by political allies of the Biden administration, which raised questions about whether the funds were awarded based on merit or “by other factors”.

The original report is available at the publisher’s website here.

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