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President Signs Fannie Mae & Freddie Mac CEOs Salary Cap Bill into Law

writing-on-paperIt appears that Fannie Mae and Freddie Mac CEOs will not be receiving the multi-million dollar pay raises that Federal Housing Finance Agency (FHFA) Director Mel Watt had in mind for them.

A statement from the White House's press secretary revealed that President Obama signed S. 2036, the Equity in Government Compensation Act of 2015 into law in November.

The bill, which "suspends compensation packages approved for 2015 for the chief executive officers of the Federal National Mortgage Association, the Federal Home Loan Mortgage Corporation, and any of their affiliates, and reinstates the compensation and benefits previously in effect," the statement said.

The U.S. House of Representatives passed S. 2036 by voice vote, placing a cap on the salaries of Fannie Mae and Freddie Mac CEOs right at the original amount of $600,000 per year.

S. 2036, also known as the Equity in Government Compensation Act of 2015,was initially scheduled to be voted on by the House in late October, but was postponed due to a hefty lineup of other legislation, including voting on a new Speaker of the House. The bill, co-sponsored by Sen. David Vitter (R-Louisiana) and Sen. Elizabeth Warren (D-Massachusetts), passed unanimously in the Senate in September.

"While this is a victory for taxpayers, the real battle of winding down the GSEs and ending the government's domination of the housing market remains,"  Royce said on Monday after the Vitter-Warren bill passed. "My ultimate goal is still comprehensive housing finance reform that brings private capital into the system to eliminate the boom-and-bust cycle that wreaked havoc on the American economy. This task takes on all the more urgency as Fannie and Freddie slip into the red and invite new taxpayer bailouts."

The White House also has also previously expressed its support for pay limits on Fannie Mae and Freddie Mac CEOs' salaries.

"I think it is entirely legitimate for the executives at those institutions to be subject to compensation limits," stated White House Press Secretary Josh Earnest.

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