Congress Passes Financial System Bailout Bill

The Senate passed its financial system bailout bill (H.R. 1424) 74 to 25 on Wednesday, October 1, 2008 and the House passed the bill 263 to 171 on Friday, October 3, 2008. President Bush signed the bill into law the same day.

The financial system bailout bill includes:

Purchase of up to $700 billion in troubled Mortgage Backed Securities

$250 available immediately

$100 billion at president's discretion

$350 billion subject to congressional review

Requirements for executive pay limits

Creation of several layers of oversight

An increase in Federal Deposit Insurance Corporation coverage of bank deposits from $100,000 to $250,000, as well as extensions of renewables tax credits [see below] and a freeze on the expansion of the Alternative Minimum Tax [25 million people] added an extra $140 billion to the original $700 billion price tag.

They put the Senate version of the renewables tax package, which includes wind, solar and plug-in electric cars, in the bill (H.R. 7060). The renewables package totals about $18 billion in tax extensions, including $1.9 billion in tax credits on solar equipment purchases by solar energy producers and $5.8 billion for wind, geothermal and biomass producers. A 30 percent credit for homeowner project costs replaces the former $2,000 credit. Energy efficient appliances qualify for the credit too. Plug-in electric cars get tax credits of $2,500 to $7,500. Electric vehicle recharging stations get a one year extension on $30,000 in tax credits or up to 30% of their costs. There are $900 million in extensions for refineries using tar sands or coal-to-liquids technology. Efforts to take away tax benefits from oil and gas companies to use them as offsets for renewables repeatedly failed before being included in this legislation.

[Text of H.R. 1424]