For more on the financial crisis, check out’s Webinar , “Wall Street In a Freefall—The Winners and Losers.”

WASHINGTON, DC-By a 263 to 171 vote, the House of Representatives passed the financial rescue plan the Bush Administration has been trying to move past the finish line for the last three weeks. This is the third time the House considered the bill.

Tinkering by both legislative branches over the last three weeks have added tighter oversight, caps on executive pay at participating firms and a mechanism for the taxpayers to share in the profits. In the Senate-amended version, tax relief in certain categories and a $150,000 increase in the amount the FDIC will insure, were added. Specifically, the 400-plus-page plan allows:

  • The Secretary of Treasury to buy bad debt mortgages, the crux of the plan that is estimated to cost $700 billion. The government will receive warrants from companies to ensure that future profits can be shared by the government.
  • The SEC to suspend mark-to-market accounting for any type of security.
  • Homeowner protections, such as allowing Treasury to modify troubled loans to prevent foreclosure in some cases.
  • Limits in tax benefits and executive pay at participating companies, particularly “golden parachutes” and bonuses in some cases.
  • A tiered schedule of funding dispersal, with Treasury receiving the first $250 billion tranche immediately. For the next $100 billion, the president must certify that additional funds are needed. The next $350 billion is subject to Congressional approval.
  • A temporary Increase in FDIC deposit insurance coverage from $100,000 to $250,000 per account, with similar increases for credit union deposits
  • Tax sweeteners including extensions of the Production Tax Credit for Alternative Energy Investments and a one-year extension of the Alternative Minimum Tax relief.

The bill is moving now to Pres. George W. Bush’s desk, who is expected to promptly sign it with great relief. Indeed it had been unclear whether the House would pass the bill on Friday, despite the considerable pressure placed on holdouts. But this storm of lobbying from the real estate and business communities–along with changes to the last version of the bill–eventually swayed enough legislators. “In the last week, AGC members generated an unprecedented number of letters to their Senators and Representatives because Congressional inaction was affecting their businesses,” Stephen Sandherr, CEO of Associated General Contractors of America, says in a prepared statement.

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