By a 237-192 vote on Wednesday night, the U.S. House of Representatives approved the latest version of financial regulatory legislation that was negotiated with the Senate. The vote was primarily along party lines, but three Republicans backed the bill, while 19 Democrats opposed it.
Meanwhile, the Senate has delayed plans to hold a vote on the bill this week before lawmakers leave Washington for their July 4 holiday recess. It appears that a final Senate vote won't be held until at least mid-July. According to news reports, the Democrats have run into trouble lining up the 60 votes needed to avert a likely Republican-led filibuster. In addition, the Democrats lost an expected vote for the bill when Senator Robert Byrd of West Virginia died on Monday.
In an effort to maintain the support of the four Republicans who voted for the Senate's version of the legislation in May, House and Senate negotiators met on Monday and decided to drop a provision to collect $19 billion in new fees from large financial firms and hedge funds. According to news reports, Senator Susan Collins of Maine has agreed to support the revised bill, while Senators Scott Brown of Massachusetts, Charles Grassley of Iowa, and Olympia Snow of Maine have not announced how they will vote. Of the two Democrats voted against the bill previously, Senator Russ Feingold of Wisconsin has said he still opposes it, while Senator Maria Cantwell of Washington has said she is still reviewing the bill.
The 2,300-page bill would require public companies to hold advisory votes on executive pay and separate shareholder votes on "golden parachute" payments starting in 2011. The legislation would bolster compensation committee independence and authorize the SEC to adopt a proxy access rule. The bill also would require issuers to adopt tougher "clawback" policies and provide new disclosure on internal pay disparity. While the legislation would not provide the SEC with self-funding authority, as some investors had sought, it would provide more resources for the commission.