[Congressional Bills 111th Congress]
[From the U.S. Government Publishing Office]
[H.R. 1664 Reported in House (RH)]
Union Calendar No. 28
111th CONGRESS
1st Session
H. R. 1664
[Report No. 111-64]
To amend the executive compensation provisions of the Emergency
Economic Stabilization Act of 2008 to prohibit unreasonable and
excessive compensation and compensation not based on performance
standards.
_______________________________________________________________________
IN THE HOUSE OF REPRESENTATIVES
March 23, 2009
Mr. Grayson (for himself, Mr. Himes, Ms. Lee of California, Mr. Welch,
Mr. Ellison, Mr. Ortiz, Mr. Perriello, Ms. Jackson-Lee of Texas, and
Mr. Connolly of Virginia) introduced the following bill; which was
referred to the Committee on Financial Services
March 30, 2009
Additional sponsor: Ms. Fudge
March 30, 2009
Reported with an amendment, committed to the Committee of the Whole
House on the State of the Union, and ordered to be printed
[Strike out all after the enacting clause and insert the part printed
in italic]
[For text of introduced bill, see copy of bill as introduced on March
23, 2009]
_______________________________________________________________________
A BILL
To amend the executive compensation provisions of the Emergency
Economic Stabilization Act of 2008 to prohibit unreasonable and
excessive compensation and compensation not based on performance
standards.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. PROHIBITION ON CERTAIN COMPENSATION.
(a) Prohibition on Certain Compensation Not Based on Performance
Standards.--Section 111 of the Emergency Economic Stabilization Act of
2008 (12 U.S.C. 5221) is amended by redesignating subsections (e)
through (h) as subsections (f) through (i), and inserting after
subsection (d) the following:
``(e) Prohibition on Certain Compensation Not Based on Performance
Standards.--
``(1) Prohibition.--No financial institution that has
received or receives a direct capital investment under the
Troubled Assets Relief Program under this title, or with
respect to the Federal National Mortgage Association, the
Federal Home Loan Mortgage Corporation, or a Federal home loan
bank, under the amendments made by section 1117 of the Housing
and Economic Recovery Act of 2008, may, while that capital
investment remains outstanding, make a compensation payment,
other than a longevity bonus or a payment in the form of
restricted stock, to any executive or employee under any
existing compensation arrangement, or enter into a new
compensation payment arrangement, if such compensation payment
or compensation payment arrangement--
``(A) provides for compensation that is
unreasonable or excessive, as defined in standards
established by the Secretary, in consultation with the
Chairperson of the Congressional Oversight Panel
established under section 125, in accordance with
paragraph (2); or
``(B) includes any bonus or other supplemental
payment that is not directly based on performance-based
measures set forth in standards established by the
Secretary in accordance with paragraph (2).
Provided that, nothing in this paragraph applies to an
institution that did business with a recipient of a direct
capital investment under the TARP.
``(2) Standards.--Not later than 30 days after the date of
enactment of this subsection, the Secretary, with the approval
of the agencies that are members of the Federal Financial
Institutions Examination Council, and in consultation with the
Chairperson of the Congressional Oversight Panel established
under section 125, shall establish the following:
``(A) Unreasonable and excessive compensation
standards.--Standards that define `unreasonable or
excessive' for purposes of subparagraph (1)(A).
``(B) Performance-based standards.--Standards for
performance-based measures that a financial institution
must apply when determining whether it may provide a
bonus or retention payment under paragraph (1)(B). Such
performance measures shall include--
``(i) the stability of the financial
institution and its ability to repay or begin
repaying the United States for any capital
investment received under this title;
``(ii) the performance of the individual
executive or employee to whom the payment
relates;
``(iii) adherence by executives and
employees to appropriate risk management
requirements; and
``(iv) other standards which provide
greater accountability to shareholders and
taxpayers.
``(3) Reporting requirement.--
``(A) In general.--Any financial institution that
is subject to the requirements of paragraph (1) shall,
not later than 90 days after the date of enactment of
this subsection and annually on March 31 each year
thereafter, transmit to the Secretary, who shall make a
report which states how many persons (officers,
directors, and employees) received or will receive
total compensation in that fiscal year in each of the
following amounts:
``(i) over $500,000;
``(ii) over $1,000,000;
``(iii) over $2,000,000;
``(iv) over $3,000,000; and
``(v) over $5,000,000.
The report shall distinguish amounts the institution
considers to be a bonus and the reason for such
distinction. The name or identity of persons receiving
compensation in such amounts shall not be required in
such reports. The Secretary shall make such reports
available on the Internet. Any financial institution
subject to this paragraph shall issue a retrospective
annual report for 2008 and both a prospective and
retrospective annual report for each subsequent
calendar year until such institution ceases to be
subject to this paragraph.
``(B) Total compensation defined.--For purposes of
this paragraph, the term `total compensation' includes
all cash payments (including without limitation salary,
bonus, retention payments), all transfers of property,
stock options, sales of stock, and all contributions by
the company (or its affiliates) for that person's
benefit.''.
(b) Revision to Rule of Construction.--Section 111(b)(3)(D)(iii) of
the Emergency Economic Stabilization Act of 2008 (12 U.S.C.
5221(b)(3)(D)(iii)) is amended by inserting before the period the
following: ``, except that an entity subject to subsection (e) may not,
while a capital investment described in that subsection remains
outstanding, pay a bonus or other supplemental payment that is
otherwise prohibited by clause (i) without regard to when the
arrangement to pay such a bonus was entered into''.
Union Calendar No. 28
111th CONGRESS
1st Session
H. R. 1664
[Report No. 111-64]
_______________________________________________________________________
A BILL
To amend the executive compensation provisions of the Emergency
Economic Stabilization Act of 2008 to prohibit unreasonable and
excessive compensation and compensation not based on performance
standards.
_______________________________________________________________________
March 30, 2009
Reported with an amendment, committed to the Committee of the Whole
House on the State of the Union, and ordered to be printed