Bush Endorses Compromise In Senate on Aid to Charities

President Bush yesterday endorsed legislation that would funnel billions of dollars to nonprofit organizations this year and next in what proponents called an effort to boost charities strapped for funds after the Sept. 11 attacks.

Bush hailed as a "great accomplishment" the compromise package -- which would cost about $12 billion in government money over two years -- reached in negotiations between the White House and Sens. Joseph I. Lieberman (D-Conn.) and Rick Santorum (R-Pa.). He was host to the senators in an Oval Office appearance "to get this really important piece of legislation through."

Bush and his aides stopped short of advocating the Senate compromise over a measure that passed the House last year, which would spend less to encourage nonprofits and has more sweeping provisions to encourage religious charities. Those provisions led the full measure to stall in the Senate after opponents argued that the House's "charitable choice" provisions allowing religious charities to get government funds without diluting their teachings would permit hiring discrimination and would subsidize religion.

But the White House sent signals that it would push the House, behind the scenes, to accept the Senate compromise. "It's not for me to say, but it sure seemed in the meeting that he's going to do everything he can to advance this proposal," Lieberman said after meeting with Bush.

Santorum, a conservative, called on House Republicans to put off discussion of the controversial "charitable choice" proposals until Congress renews the 1996 welfare reform law in a few months. A House leadership aide said Santorum's suggestion was "an option," but Rep. J.C. Watts (R-Okla.), the sponsor of the House measure, said the Senate compromise will require "a little more faith" to pass both chambers.

Rep. Mark Foley (R-Fla.), who had objected to the controversial House provisions, predicted "clear sailing" for the Senate compromise in the House. "There may be a squabble behind closed doors, but they'll put a brave face on it," he said.

The Senate measure, which would require renewal after two years, includes a $400-per-person charitable tax deduction for those who do not itemize deductions on their tax returns -- a provision the Treasury Department said would cost $8.4 billion over two years. Independent Sector, an association of nonprofits, said the change would bring to charities at least 15 percent more than the amount the government spends.

The Senate proposal would also let IRA holders make charitable contributions from their accounts, enhance deductions for donations of food and books, raise caps on corporate charitable contributions and introduce individual development accounts, which are savings accounts for low-income families providing incentives for home buying, education or starting a business. The compromise also contains provisions to outlaw discrimination against groups that have religious names or display religious icons, but these are far narrower than House provisions that would have allowed religion to be blended with charity more openly.

For accounting purposes, the proposal would be called an "emergency" measure so the proponents would not have to find a way to pay for it. "This is declared to be an emergency in response to 9-11 and the recession and the tremendous and rising human needs in our country," Lieberman said. "And, obviously, government cannot itself meet them all. So we are, in this bill, empowering a whole range of charitable organizations, including . . . faith-based, to do that."

Earlier in the day, Bush delivered a similar sentiment about the need to call on faith to solve the problems of Sept. 11. "Millions of Americans have been led to prayer," Bush said at the National Prayer Breakfast, where he was joined by national security adviser Condoleezza Rice and various political leaders. "They have prayed for comfort in time of grief, for understanding in a time of anger, for protection in a time of uncertainty. Many, including me, have been on bended knee."

Some purists on both sides raised objections to the Senate compromise. Barry W. Lynn, executive director of the civil liberties group Americans United for Separation of Church and State, said the Senate plan "still contains several problematic provisions." Michael Horowitz, a scholar at the conservative Hudson Institute, called the measure "profoundly dangerous and constitutionally inappropriate."

But large charitable and religious organizations applauded the compromise. Catholic Charities USA, which took no position on the House measure, backed the Senate compromise. "This package is a leap forward," said Nathan Diament, public policy director for the Union of Orthodox Jewish Congregations of America.

Yesterday's formal unveiling of the proposal indicated a broad range of support in the Senate. Conservative Sens. Orrin G. Hatch (R-Utah) and Sam Brownback (R-Kan.) and liberal Sen. Hillary Rodham Clinton (D-N.Y.) were among those joining Lieberman and Santorum at the White House yesterday.

But Sen. Charles E. Grassley (Iowa), the ranking Republican on the Finance Committee, warned after the meeting yesterday that "we're going to have to work hard to get [the tax deduction] through the Senate." Grassley is working with Finance Committee Chairman Max Baucus (D-Mont.) on a smaller charity package that does not include the deduction.