The leading Senate Republican champion of President Bush's initiative to help religious charities agreed yesterday to drop its most controversial provisions in hopes of winning swift approval of tax incentives to encourage charitable contributions.
The new plan leaves virtually nothing of Bush's original plan to expand government funding of religious charities but increases chances of a break in the two-year deadlock that held up passage of more general legislation aimed at helping charities of all kinds.
Sen. Rick Santorum (R-Pa.), who announced the move to supporters on Capitol Hill, said Republicans have approved the change. Democrats are still considering it but are likely to go along so long as they receive assurances that controversial religious provisions are not restored in negotiations with the House over a final bill, according to a Democratic source.
If bipartisan approval is reached, the bill could be on the Senate floor early next week, according to a Senate Republican aide.
The House two years ago approved the president's proposal to empower religious groups to obtain government money for social services such as hunger relief and housing for the homeless, including particularly controversial language preempting state and local anti-discrimination laws.
The Senate bill was narrower and did not include the anti-discrimination preemption. But it has been in limbo for more than a year because of controversy over provisions opening government grants and contracts to religious groups under certain circumstances. The legislation said groups could not be excluded from receipt of federal funds solely because they had religious names, displayed religious icons, included religious language in their chartering documents or used religious criteria for their governing bodies.
While supporters of these provisions described them as necessary to help valuable charities with only indirect religious connections, critics expressed concern that they would erode the constitutional separation of church and state.
Opponents of the administration's initiative hailed Santorum's announcement as a victory. "It's a huge break in the battle over this," said Joe Conn, spokesman for Americans United for Separation of Church and State, a Washington advocacy group. "Frankly, they blinked," he added.
A Senate Republican aide acknowledged that Santorum "would have liked to have done more in the legislation" but added, "we'll take what we can get." She said religious charities will benefit from the tax incentives for contributions.
Stripped of its faith-based language, the bill will now provide an array of tax incentives to encourage charitable contributions, including a tax deduction of $250 per person to people who do not take itemized deductions on their tax returns.
People could roll over their individual retirement accounts directly to charities without paying a tax penalty, and new incentives would be provided for donations to food banks. The federal excise tax on charitable foundations would be reduced, and the limit would be raised on how much a corporation could contribute to charity. Low-income families would be empowered to set up personal savings accounts with contributions that could be matched by banks. A block grant for social services, which provides grants to social welfare charities, would be increased by $1.2 billion over the next two years.
Staff writer Alan Cooperman contributed to this report.