Rep. Barney Frank (D-Mass.) on Friday outlined wide-ranging legislation that would significantly overhaul the restrictions on how the second half of the $700 billion financial rescue package may be spent.

The Financial Services Committee chairman intends to introduce legislation that bars the president from having access to the remaining $350 billion unless the Treasury Department crafts a plan to reduce the number of foreclosures and commits at least $50 billion to the effort.

Frank's legislation, still being drafted, comes as an oversight panel Congress set up to look into the $700 billion rescue package released a highly critical report on Treasury’s handling of the program. President-elect Obama’s transition team is reportedly crafting plans on how to use the last $350 billion, and Tim Geithner, Obama’s pick for Treasury secretary, is set for confirmation hearings next week.

Lawmakers from both sides of the aisle have been highly critical of Treasury Secretary Henry Paulson for his handling of the rescue package and for the department’s shifting strategies from purchasing troubled assets to primarily injecting equity into troubled banks. Democrats in particular have been critical of Treasury for failing to commit money under the Troubled Asset Relief Program (TARP) to ease the stress in the housing market.

Some lawmakers have indicated that they would like to include measures to prop up the housing market as part of the economic stimulus package that is being debated by Obama’s administration and Congress.

Frank's legislation would require additional public reporting requirements for any company receiving money under the rescue package. The legislation requires that banks receiving TARP funds report quarterly on how the money has been used to increase lending. Bank regulators would also examine whether firms receiving funds have met new benchmarks.

The legislation would bar any bonus pay for the 25 most highly compensated officers of any firm that receives funds from the remaining $350 billion pool of money, and provides the Treasury Department to further regulate executive compensation for firms that already received bailout money.

Frank hopes to ensure that Federal Deposit Insurance Corporation Chairwoman Sheila Bair has a stronger role in TARP by requiring that the Financial Stability Oversight Board include her and two other presidential appointees at the table. Democrats have praised Bair throughout the fall for pressing a mortgage foreclosure program that has been the source of internal Bush administration disagreements.

Frank also intends to beef up the beleaguered Hope for Homeowners program he pushed for in the summer. The $300 billion legislation was intended to help 400,000 homeowners avoid foreclosure, but has had scant results so far.