IB 
Union Calendar No. 247 
112TH CONGRESS 
2D SESSION 
H. R. 1221 
[Report No. 112–366, Part I] 
To suspend the current compensation packages for the senior executives 
of Fannie Mae and Freddie Mac and establish compensation for such 
positions in accordance with rates of pay for senior employees in the 
Executive Branch of the Federal Government, and for other purposes. 
IN THE HOUSE OF REPRESENTATIVES 
MARCH 29, 2011 
Mr. BACHUS (for himself, Mr. GARRETT, Mr. HENSARLING, Mr. PEARCE, and 
Mrs. BIGGERT) introduced the following bill; which was referred to the 
Committee on Financial Services, and in addition to the Committee on 
Oversight and Government Reform, for a period to be subsequently deter-
mined by the Speaker, in each case for consideration of such provisions 
as fall within the jurisdiction of the committee concerned 
JANUARY 17, 2012 
Additional sponsors: Mr. MCCOTTER, Mr. CANSECO, Mr. ROYCE, Mr. GER-
LACH, Mr. WOMACK, Mr. REHBERG, Mr. ISSA, Mr. FORBES, Mr. VIS-
CLOSKY, Mr. LOBIONDO, Mr. COFFMAN of Colorado, Mr. KISSELL, Mr. 
NUNNELEE, Mr. DEFAZIO, and Mrs. NOEM 
JANUARY 17, 2012 
Reported from the Committee on Financial Services with an amendment 
[Strike out all after the enacting clause and insert the part printed in italic] 
JANUARY 17, 2012 
The Committee on Oversight and Government Reform discharged; committed 
to the Committee of the Whole House on the State of the Union and or-
dered to be printed 
[For text of introduced bill, see copy of bill as introduced on March 29, 2011] 
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A BILL 
To suspend the current compensation packages for the senior 
executives of Fannie Mae and Freddie Mac and establish 
compensation for such positions in accordance with rates 
of pay for senior employees in the Executive Branch 
of the Federal Government, and for other purposes. 
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Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
SECTION 1. SHORT TITLE. 
This Act may be cited as the ‘‘Equity in Government 
Compensation Act of 2011’’. 
SEC. 2. CONGRESSIONAL FINDINGS. 
The Congress finds that— 
(1) the Federal National Mortgage Association 
(known as Fannie Mae) and the Federal Home Loan 
Mortgage Corporation (known as Freddie Mac), which 
are both privately owned but publicly chartered Gov-
ernment-sponsored enterprises (GSEs), were at the 
center of the mortgage market meltdown that caused 
the financial crisis that commenced in 2008; 
(2) the failures of Fannie Mae and Freddie Mac 
helped precipitate the deepest economic decline since 
World War II; 
(3) in September 2008, the Bush Administration, 
Federal Reserve Board, and Federal Housing Finance 
Agency (FHFA) exercised authority granted by the 
Congress to place the two GSEs in conservatorship, a 
form of nationalization that puts the regulators firm-
ly in control of the GSEs’ daily operations; 
(4) in September 2008, the Bush Administration 
established a $200 billion facility to purchase senior 
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preferred stock in the enterprises to backstop their 
losses; 
(5) in February 2009, the Obama Administra-
tion raised the senior preferred stock purchase com-
mitment to $400 billion; 
(6) on Christmas Eve 2009, the Obama Adminis-
tration removed any limits on the use of Federal 
funds to cover losses at the enterprises, significantly 
expanding a commitment that has resulted in the ex-
penditure of so far nearly $175 billion in taxpayer 
funds to purchase senior preferred stock in the two en-
terprises; 
(7) as a result of the Government’s actions, the 
taxpayers of the United States now own nearly 80 
percent of the two GSEs; 
(8) the Congressional Budget Office has con-
cluded that Fannie Mae and Freddie Mac have effec-
tively become Government entities whose operations 
should be included in the Federal budget; 
(9) the GSEs are expected to be a long-term 
drain on the taxpayers as a result of market condi-
tions and the political and public policy mandates 
imposed on them by the Administration and the Con-
gress; 
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(10) in spite of these liabilities, the Treasury De-
partment and FHFA approved compensation pack-
ages for the chief executive officers of Fannie Mae and 
Freddie Mac in 2009, 2010, and 2011 that were near-
ly 15 times greater than the annual compensation of 
the President of the United States and 30 times great-
er than the annual compensation of a Cabinet Sec-
retary; 
(11) the Treasury Department and the FHFA 
also approved multi-million dollar compensation 
packages for a number of the GSEs’ top executives, 
payable in cash rather than in the type of stock op-
tions that have characterized compensation arrange-
ments at other large financial institutions that have 
received extraordinary government assistance; 
(12) on September 17, 2008, FHFA determined 
that no executive officer of Fannie Mae or Freddie 
Mac would be entitled to receive a cash bonus or long- 
term incentive awards for 2008; 
(13) FHFA’s five-year Strategic Plan for Fannie 
Mae and Freddie Mac includes a commitment that 
the GSEs will operate in a safe and sound manner; 
and 
(14) section 1318(c) of the Federal Housing En-
terprises Financial Safety and Soundness Act of 1992 
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(12 U.S.C. 4518(c), as added by section 1113(a)(4) of 
the Housing and Economic Recovery Act of 2008 
(Public Law 110–289; 122 Stat. 2678)), permits the 
Director of FHFA to withhold any payment, transfer, 
or disbursement of compensation to an executive offi-
cer, or to place such compensation in an escrow ac-
count, during the review of the reasonableness and 
comparability of compensation. 
SEC. 3. DEFINITIONS. 
In this Act: 
(1) DIRECTOR.—The term ‘‘Director’’ means the 
Director of the Federal Housing Finance Agency. 
(2) EMPLOYEE.—The term ‘‘employee’’ means an 
employee of an enterprise, except that such term does 
not include any employee who would be defined as a 
prevailing rate employee (as defined in section 
5342(2) of title 5, United States Code) if such em-
ployee were employed by an agency (as defined in 
paragraph (1) of such section). 
(3) 
ENTERPRISE.—The 
term 
‘‘enterprise’’ 
means— 
(A) the Federal National Mortgage Associa-
tion and any affiliate thereof; and 
(B) the Federal Home Loan Mortgage Cor-
poration and any affiliate thereof. 
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(4) EXECUTIVE OFFICER.—The term ‘‘executive 
officer’’ has the same meaning as is given such term 
in section 1303(12) of the Federal Housing Enter-
prises Financial Safety and Soundness Act of 1992 
(12 U.S.C. 4502(12)). 
SEC. 4. REASONABLE PAY FOR EXECUTIVE OFFICERS. 
(a) SUSPENSION OF CURRENT COMPENSATION PACK-
AGES.—The Director shall suspend the compensation pack-
ages approved for 2011 for the executive officers of an enter-
prise and, in lieu of such packages, subject to the limitation 
under subsection (d), establish a compensation system for 
the executive officers of such enterprise in accordance with 
the schedules of compensation and benefits established and 
adjusted pursuant to section 1206 of the Financial Institu-
tions Reform, Recovery, and Enforcement Act of 1989 (12 
U.S.C. 1833b). 
(b) CLAWBACK OF 2010 AND 2011 COMPENSATION.— 
(1) SENSE OF THE CONGRESS.—It is the sense of 
the Congress that each executive officer performing 
services for an enterprise on the date of the enactment 
of this Act whose compensation package is suspended 
under subsection (a) should return to the Secretary of 
the Treasury any compensation earned in 2010 and 
2011 that was in excess of the maximum annual rate 
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of basic pay authorized for a position in level I of the 
Executive Schedule. 
(2) USE TO REDUCE NATIONAL DEBT.—The Sec-
retary of the Treasury shall transfer any amounts re-
ferred to in paragraph (1) that are returned to the 
Secretary to the special account established by section 
3113(d) of title 31, United States Code (relating to re-
ducing the public debt). 
(c) ADDITIONAL REQUIREMENT.—An executive officer 
of an enterprise shall be subject to section 111 of the Emer-
gency Economic Stabilization Act of 2008 (12 U.S.C. 5221), 
which relates to executive compensation and corporate gov-
ernance. 
(d) LIMITATION ON COMPENSATION.—An executive of-
ficer of an enterprise whose compensation package is sus-
pended under subsection (a) shall not be compensated more 
than the highest compensated employee of the Federal Hous-
ing Finance Agency. 
SEC. 5. COMPENSATION RATE OF EMPLOYEES OF FANNIE 
MAE AND FREDDIE MAC. 
(a) IN GENERAL.—During any period that an enter-
prise is federally chartered under the Federal National 
Mortgage Association Charter Act (12 U.S.C. 1716 et seq.) 
or the Federal Home Loan Mortgage Corporation Act (12 
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(3) CREDIT
FOR
INCREASE
IN
COMPENSATION 
BEFORE
ADJUSTMENT.—Each employee performing 
services for an enterprise on the date of the enactment 
of this Act whose position is converted under this sub-
section to the General Schedule and who prior to the 
initial adjustment of his or her rate of basic com-
pensation under paragraph (1) has earned, but has 
not been credited with, an increase in that rate, shall 
be granted credit for such increase before his or her 
rate of basic compensation is initially adjusted under 
such paragraph. 
(4) SERVICE
PERFORMED
SINCE
LAST
COM-
PENSATION
INCREASE.—Each employee performing 
services for an enterprise on the date of the enactment 
of this Act whose position is converted under this sub-
section to the General Schedule shall be granted cred-
it, for purposes of his or her first step increase under 
the General Schedule, for all satisfactory service per-
formed since his or her last increase in compensation 
prior to the initial adjustment of his or her rate of 
basic compensation under paragraph (1). 
(5) COMPENSATION INCREASE UNDER THIS SEC-
TION.—An increase in the rate of basic compensation 
by reason of the enactment of paragraph (1) shall not 
be considered to be an equivalent increase with respect 
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to step increases for employees whose positions are 
converted to the General Schedule under authority of 
this subsection. 
(c) NEW EMPLOYEES.—Except for as provided in sec-
tion 4, the grade and rate of basic pay of any individual 
beginning employment with an enterprise after the date of 
enactment of this Act shall be fixed in accordance with the 
General Schedule set forth in section 5332 of title 5, United 
States Code. 
SEC. 6. FANNIE AND FREDDIE EMPLOYEES NOT FEDERAL 
EMPLOYEES. 
Any executive officer or employee affected by any pro-
vision under sections 4 and 5, respectively, shall not be con-
sidered a Federal employee. 
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Union Calendar No. 247 
112TH CONGRESS 
2D SESSION 
H. R. 1221 
[Report No. 112–366, Part I] 
A BILL 
To suspend the current compensation packages for 
the senior executives of Fannie Mae and Freddie 
Mac and establish compensation for such posi-
tions in accordance with rates of pay for senior 
employees in the Executive Branch of the Fed-
eral Government, and for other purposes. 
JANUARY 17, 2012 
Reported from the Committee on Financial Services with 
an amendment 
JANUARY 17, 2012 
The Committee on Oversight and Government Reform 
discharged; committed to the Committee of the Whole 
House on the State of the Union and ordered to be 
printed 
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