The U.S. House approved legislation Thursday to force General Motors Co. and Chrysler Group LLC to reinstate roughly 2,000 dealers the car makers' cut as part of their government-backed bankruptcy reorganizations.

The Obama administration strongly opposed the measure, warning this week the bill could derail the auto makers' restructuring efforts, backed by about $60 billion in government funding. The White House stopped short of threatening a veto.

The provision, attached to a must-pass spending bill, forbids the administration from giving bailout funds to the auto makers unless they fully restore dealers' rights under state franchise laws. The measure could effectively force GM and Chrysler to reopen dealerships or to increase compensation payments to rejected dealers.

The vote was 219-208.

Talks among dealers, auto makers and lawmakers aimed at reaching a compromise appeared to break down Thursday. Dealers said they believed they had enough support to get the legislation through Congress and wouldn't accept anything short of the measures in the House bill.

"We're at the table with Congress and we hope that the dealers decide to join us," GM spokesman Greg Martin said.

The bill now goes to the Senate, where support for the dealers is less certain. Senate Majority Leader Harry Reid, D-Nev., said this week the legislation on dealers wasn't a top priority.

The main purpose of Thursday's House bill is to fund the Treasury Department and other federal agencies, including the Securities Exchange Commission, the Consumer Products Safety Commission and the Federal Deposit Insurance Corporation in fiscal 2010.

The SEC would receive $76 million over its funding level in the current year, bringing its budget for fiscal 2010 to $1.08 billion. The increase is to boost its enforcement abilities.

The bill also places stringent disclosure requirements on the Treasury related to its efforts to stabilize the financial markets.

The requirements would apply to investments made through the Troubled Asset Relief Program - the primary vehicle through which the federal government has made investments in private firms since the economic crisis began last fall - but also to its moves to take over Fannie Mae (FNM) and Freddie Mac (FRE) and in "any other investments of taxpayer funds aimed at ensuring economic and financial stability."

The House bill would compel the Treasury to inform Congress by Dec. 1 whether it intends to make further investments in companies, when it expects outstanding money to be repaid to the Treasury, and whether it anticipates the taxpayer ultimately earning a profit or taking a loss on those investments already made.

Neither the tough disclosure language nor the measure aimed at assisting the auto dealers is in companion legislation in the Senate. Majority Leader Harry Reid, D-Nev., said this week the Senate would be unlikely to take up the dealership measure.

The $24 billion spending bill is one of 12 that Congress must pass each year to fund the various arms of the federal government through the next fiscal year. The federal government's fiscal year begins on Oct. 1.

-By Corey Boles and Josh Mitchell, Dow Jones Newswires; 202-862-6601; corey.boles@dowjones.com