Auto Update-

*Note- this is just a brief summary. Please see the available language for further details.

The revised auto legislation would draw the emergency loans ($14 billion) from the existing loan program meant to help the automakers build fuel-efficient vehicles (sec. 136). Under the proposed language, the president would appoint an individual (the car czar) to work with the companies to come up with a plan to cut costs, restructure debt, and obtain concessions from labor by the end of March. The car czar would have the veto power over company transactions of $100 million or more. The Office of Comptroller General would conduct oversight. The plan would limit executives’ pay packages, get rid of corporate jets, stop dividend payments, and give the government the right to buy a stake in the companies at a certain price. If the companies fail to develop a viable restructuring plan, the car czar can require repayment of the bridge loans.  If a company fails to meet the goals of a negotiated plan, the agreement requires the car czar to submit a new plan to Congress that could include the option of a Chapter 11 bankruptcy reorganization.

The Majority Leader announced his intention to file cloture on the motion to proceed to one of the tax bills he rule 14’d this week for purposes of an auto bailout vehicle. If he files today, that vote would ripen on Friday morning. Unless there is unanimous consent to yield back time in this process, the Senate would work through the weekend. Of course, this process could change if the House sends us something first, so it is still unclear at this point how the majority leader will proceed. Additional information will be announced as it becomes available.