Natural State News

The Congressional Oversight Commission has found that a Kansas trucking company has secured a $700 million federal loan in an apparent "misstep" by the Treasury Department and the Department of Defense, according to a report released on March 3.

One of three commissioners, U.S. Rep. French Hill, told the Arkansas Democrat-Gazette that the company "didn't appear to qualify for the narrowly tailored program."

"I am proud to serve on the CARES Act Congressional Oversight Commission. Our work ensures taxpayer dollars are being used responsibly to provide economic stability as America recovers from the COVID-19 pandemic. Through my role on the commission, I have been sounding the alarm on the $700 million taxpayer-backed loan Treasury made to Yellow, formerly YRC. As evidenced by our oversight work, this loan was a mistake and should have never been executed," Hill wrote in a Facebook post. "It’s clear to me that, for over a decade now since the start of the financial crisis and now in the midst of a pandemic, Yellow has survived only through government intrusion and bailouts. American taxpayers should not have to keep underwriting debt to pay for Yellow’s poor financial decision. I continue to raise concerns and uncover facts that show this loan was a mistake."

Commissioners are investigating who assessed that the company, then known as YRC Worldwide, was "important to national security" and thus eligible for the national security loan program, which was accepted near the start of the COVID-19 pandemic.

The company, which changed its name to Yellow earlier this year, reportedly received the loan after spending $570,000 on lobbying last year. The previous year, it had spent nothing.

Although Yellow reported a net loss of $53.5 million in 2020 and $104 million in 2019, its YRC Worldwide stock rose from $1.85 on June 30 to $3.23 on July 1, the day the Treasury Department announced plans to provide the funds.

Commissioners have been looking for answers since the loan was made public in late July and the stock price has continued to grow since the loan was made public, closing March 30 at $9.17 a share.