Senate negotiators on the intelligence reform bill yesterday offered to drop their requirement that the overall intelligence budget be made public if House Republicans accept the Senate plan for a new national intelligence director.

Under the Senate approach, the director would assume control of budget and spending authority, now said to total $40 billion, most of which is hidden in the Pentagon budget and is under the control of the defense secretary. Senate conferees say they now are willing to keep the spending secret but insist that control of the funds be shifted from the Pentagon to the intelligence director.

But House Armed Services Committee Chairman Duncan Hunter (R-Calif.) has staunchly opposed the Senate approach, and yesterday a committee spokesman dismissed the new Senate proposal as a "non-starter."

Harald Stavenas, staff director of the House committee, said in a statement: "Hunter wants funding to go through the Defense Department rather than directly to the intelligence agencies." He added that the Senate offer "retains exclusive authority for the NID [national intelligence director] to 'execute' defense intelligence funds. That's a non-starter for us."

Sen. Susan Collins (R-Maine), chairman of the Senate Governmental Affairs Committee and the chief Senate negotiator, said she was "surprised" at what appeared to be such a quick negative response.

"We have made a major concession," she said, noting that continuing to classify the overall intelligence budget figure was one of the items that "mattered most to the White House as well as House Republicans."

Collins added that the language the House appears to be rejecting was drafted by the White House Office of Management and Budget. She said she believes that the White House will now put more effort in getting a final agreement, noting that the Senate approach has been backed by House Democrats on the conference committee.

With Congress returning next week for a lame-duck session likely to last little more than a week, time for a compromise on the complex bill is quickly running out, Collins said. Restructuring of the U.S. intelligence community, primarily by creating an overall director for all 15 agencies covering foreign and domestic intelligence, was a primary goal of the commission that investigated the Sept. 11, 2001, terrorist attacks and released a report and recommendations in July.

The talks involve competing 500-page bills. Commission leaders and victims' families favor the Senate bill over the House version, which contains a number of controversial intelligence issues as well as changes to immigration laws.

The heart of the House-Senate dispute is the new intelligence director's power over money spent by three Pentagon-based intelligence collection agencies, the National Security Agency, which intercepts and analyzes electronic messages; the National Reconnaissance Office, which builds and operates intelligence satellites; and the National Geospatial-Intelligence Agency, which analyzes imagery and makes maps.

Collins said yesterday that the new Senate offer included limiting to 10 percent the NID's authority to transfer funds or personnel from one intelligence agency to another. "This is another big compromise," she said. "The House started at 5 percent and we started at 100 percent."

The Senate offer also incorporates House language in other areas, such as transportation security, border protection and visa matters. But it does not accept some of the House's more controversial proposals on immigration and other issues of homeland defense and terrorism.

Rep. Duncan Hunter (R-Calif.) opposes shifting budget authority to a new national intelligence director.