Fairly early on in the day, they arrived at a compromise on how to resolve the Florida delegates, but the Michigan question took quite a bit longer. The final decisions, passed unanimously in the case of Floriday and by a 2/3 majority in the case of Michigan, are as follows:
1) Florida: the entire delegation will be seated and the votes will be allocates as they were cast. However, the value of each delegate will be cut in half so that each delegate will cast a half vote. This results in Hillary achieving a net gain of 19 delegates.
2) Michigan: again, the entire delegation will be seated, and each delegate will cast a half vote.
However, since it was impossible to determine how the voters might have cast their ballots in a full election (remembering that Barack Obama, John Edwards, and Bill Richardson had all chosen to remove their names from the ballot in compliance with their understanding of the party rules), the Committee heard many proposals for how the delegates could be awarded to candidates. In the end, they accepted the proposal of the Michigan state delegation itself, which suggested that the delegates be split 59-69 in favour of Hillary Clinton. Once accounting for the half votes, this would wind up with 34.5 for Hillary and 29.5 for Barack - a total gain of 5 delegates for Hillary.
So, we have arrived at a solution. Both solutions were voted for in large numbers by Hillary Clinton's supporters on the Committee (who significantly outnumbered Obama supporters there). Both solutions were supported by the leadership of the states in question. Both solutions ahve the support of the Obama camapaign, even though they cause him to lose delegates.
Harold Ickes, from the Clinton campaign has said that Hillary reserves the right to challenge this result at the convention. However, it's unclear whether she will ultimately chose to do this. Especially since, unlike the standing Rules committee which is weighted towards her supporters, the Convention Credentials committee will contain a majority of Obama supporters.
I think it is fairly safe to say that the Michigan and Florida delegate problem has been resolved.
Is it a perfectly fair solution? In my view, it is not. Those voters who in good faith chose not to participate in an election that they were told would not count have been left out unfairly. It is by no means certain that Hillary Clinton would have won in Michigan if Barack's name been on the ballot in the first place. In both states, there is no way of knowing what the outcome would be if both candidates had actually campaigned in the states - Barack has significantly improved his numbers in every state he has actively campaigned in so far.
HOWEVER, as I have said before - a perfectly fair resolution was not possible at this point in the process. This is a resolution arrived at within the rules after careful deliberation, with the input of both campaigns and the states in question. It honors the voters of these states but still applies a penalty for the state's non-compliance.
Barack Obama is down 24 delegates today. But he still leads in the pledged delegates. He still leads in super delegates. He still leads in states won. He still leads in the popular vote (by almost every measure of counting).
Neither candidate achieved the best possible outcome at the Rules and Bylaws Committee yesterday. However, it may be that we have achieved the best possible outcome for the country - the chance to put all this behind us.