Rep. Alan Grayson, D-Orlando, will see vote on his bonus-pay bill

Mark K. Matthews | Orlando Sentinel

WASHINGTON - The U.S. House is expected to vote today on a measure aimed at halting the payout of "unreasonable and excessive" bonuses to employees of financial companies that received federal bailout money.

The bill - a brainchild of U.S. Rep. Alan Grayson, D-Orlando - would let the Treasury Department and financial regulators set standards to avoid a repeat of the outrage over AIG, the insurance giant that paid $165 million in bonuses to executives after it got more than $180 billion in bailout funds.

"We don't want people to get rich off taxpayer funds," Grayson said. "If they [financial employees] destroy the institution they work for, they shouldn't be running off to the bank with millions [of dollars]."

It's the first bill he has written. "It's a very exciting thing for me," said Grayson, an attorney who got national publicity for suing war profiteers before being elected last fall.

In an institution largely ruled by seniority, it's unusual for a freshman to take center stage on a major national issue. But a spokesman for U.S. Rep. Barney Frank, the Massachusetts Democrat who chairs the House Financial Services Committee, credited Grayson with coming up with the idea.

"Whenever a freshman, or any member, expresses an interest in an issue, the chairman lets them take it and run with it," said spokesman Steven Adamske.

The bill is co-sponsored by another freshman, U.S. Rep. Jim Himes, D-Conn. It would require that bonuses be based on performance, under criteria set by the Treasury Department and the Federal Financial Institutions Examination Council, an interagency group that sets standards for federal oversight of the economic markets.

If it passes today, the bill would head to the Senate, where members have stalled House-passed legislation that would impose a 90 percent tax rate on bonuses issued by companies that receive bailout money. The drive to get back the money, however, has cooled since some of the biggest recipients of AIG bonuses have returned them or donated the money to charity.

So far, the Grayson legislation has been well-received as a compromise between doing nothing and the earlier House bill. It passed the Financial Services Committee 38-22 last week. And it has gotten a thumbs up from the industry and economists.

"This is a leading contender as a solution to the economic and political problem [of the bonuses]," said Scott Talbott, chief lobbyist for the Financial Services Roundtable, an industry group.

Still, Republicans on the committee argued that the measure was too broad, drafted too hastily and gives more work to Treasury Secretary Tim Geithner, whose hands already are full dealing with the national economic crisis.

"The man has enough problems himself trying to run that massive organization," said U.S. Rep. Don Manzullo, R-Ill. "What bothers me about legislation like this - it's done in haste. Nobody has made any qualitative study as to the impact ... this will dry up the market even more."

Rep. Spencer Bachus, R-Ala., said he was worried that the measure would be a "huge intrusion" by the government into the financial sector. "Since when did the government start deciding what corporations could pay and what is generous and what is not?" he asked.