President-elect Barack Obama on Monday asked President George W. Bush to formally request that Congress release the remaining $350 billion in financial sector bailout funds, putting the wheels in motion for votes in the House and Senate this week.

At the same time that Obama contacted Bush, Lawrence Summers, Obama’s pick to direct the National Economic Counsel, sent a letter to House and Senate leaders laying out the steps the new administration would take to increase transparency and oversight of the financial bailout program at the Treasury Department.

“President-elect Obama believes there has been too little transparency and accountability; too much upside for financial institutions and executives who acted irresponsibly without providing enough help for small business owners, families who are struggling to keep their jobs and make ends meet, and innocent homeowners,” Summers wrote.

The letter, viewed by Senators as critical to assuring the release of the remaining $350 billion, spells out in general terms how Obama would run the program differently. Without offering specifics, Summers said the incoming administration’s Treasury Department would work with Congress and the Federal Reserve to encourage banks to lend to small businesses, car buyers and cities that have been hampered by the ongoing credit crunch.

Summers also promises to “report on a continuous basis” to Congress and to revamp oversight of the program by taking recommendations from a Congressional oversight panel that has been highly critical of the Bush administration’s handling of the first $350 billion in funds.

In what could be a crucial paragraph for many Democrats, the letter also notes that Obama already has directed his staff and Cabinet appointees to “work with Congress immediately to implement smart, aggressive policies to reduce the number of preventable [home] foreclosures.”

Summers also vows to impose tough new rules on executive compensation for firms that take federal money, as well as requiring that bailout funds only go to firms that cannot attract private capital.

It was unclear when Bush would make the formal request to Congress on Obama’s behalf, but senior Senate Democratic aides said a vote on the money is likely to occur by mid-week in the House and by Friday in the Senate.

“President Bush agreed to the president-elect’s request. We will continue our consultations with the president-elect’s transition team, and with Congress, on how best to proceed in accordance with the requirements of the statute,” White House spokeswoman Dana Perino said.