Democratic senators have set a goal of Feb. 13 to pass an $800 billion economic stimulus package proposed by President-elect Obama.

Senate Democrats said they made significant progress during a rare two-hour Sunday meeting with Lawrence Summers, a senior Obama aide who will head the National Economic Council.

Sen. Kent Conrad (D-N.D.), a member of the Senate Finance Committee, applauded the incoming Obama administration’s response to criticism its proposal received on Capitol Hill last week.

"It is very clear that they’ve listened and heard and are working to respond," said Conrad. "They’re not defensive and arguing back."

Conrad said he received a call from Summers on Friday after he criticized Obama’s proposal to include several tax incentives such as a $3,000 tax credit to employers for each new hire.

"I was very impressed today and impressed with the phone call I received from Summers on Friday."

Some Democrats were upset last week that Obama’s economic team did not call for allocating more money to promoting renewable energy production, such as wind and solar power.

Democrats said last week that Obama needed to propose more tax incentives for renewable energy productions.

It appears that Obama’s team has altered their proposal to court those critics.

"We wanted to see more energy tax credits," said Sen. Barbara Boxer (D-Calif.), chairwoman of the Environment and Public Works Committee. "They’re moving in our direction. They’re really listening."

Democrats also said they were willing to approve the second installment of the $700 billion financial stabilization package, also known as the Troubled Asset Relief Program (TARP), which Congress passed last year.

Many lawmakers on both sides of the Capitol, however, are angry over how the Bush administration handled the first $350 billion tranche.

Bush administration officials allocated a large chunk of the funds to capitalize banks, taking a different course from the one they proposed to Congress in the fall.

Administration officials told Congress initially the funds would be used to buy toxic assets, such as securities backed by troubled mortgages, assets that had been blamed for the freeze on lending throughout the financial markets.

Many lawmakers are irate the Bush administration steered billions to banks without requiring them to increase lending. As a result, banks are sitting on huge capital reserves while credit markets have regained little liquidity.

Lawmakers demanded Sunday that officials in the incoming Obama administration set out clear conditions for the second half of the $700 billion.

Specifically, lawmakers would like to see that financial institutions that accept federal aid are required to increase their lending.

Lawmakers also want to ensure that bailout funds are not used to purchase smaller, healthy banks, an unforeseen outcome of the first tranche of the Wall Street stabilization package.

"People are not averse [to approving the second tranche] but there has to be much stronger conditionality," said Schumer, a member of the Senate Banking Committee.

Lawmakers anticipate a formal request for the second half of the $700 billion this week, as the Bush administration has said it is discussing how to handle a request for the second half of the funds with the Obama transition team.

But it would be difficult for Congress to implement conditions through legislation without delaying the money and causing economic harm.

"How do you have good, strong conditions without having it signed into law," said Schumer. "That’s what people are wrestling over."

The Bush administration is expected to request the $350 billion but the incoming Obama administration will have power over how to appropriate it.

Several lawmakers said that Obama officials would likely send a letter to Congress next week outlining the conditions they would follow if granted the $350 billion.

This story was updated at 6:11 p.m.