WASHINGTON -- President Bush gave his blessing to compromise legislation to help religious charities Thursday, heralding it as a way to help religious groups without breaching the Constitution's separation between church and state.
Bipartisan legislation developed in the Senate includes new tax breaks to encourage charitable donations but drops the most divisive elements of the White House's so-called faith-based initiative.
"We have an opportunity to capture the compassion of the country, focus it in the right direction," Bush said.
To keep down the cost, most of the provisions are to expire after two years. The total cost is about $12 billion over 10 years, with about $10 billion of that spent in the first two years.
Bush disclosed the deal at the White House with key backers, Sens. Joseph Lieberman (D-Conn.) and Rick Santorum (R-Pa.), who began writing the revised legislation after a partisan fight in the House last summer.
The Senate bill would give a new tax break to the 70 percent of tax filers who claim the standard deduction. Individuals could deduct up to $400 a year in charitable donations from their income in calculating how much they owe in taxes. For couples, the maximum deduction would be $800.
The compromise also gives tax breaks for corporate donations, allows tax-free donations from Individual Retirement Accounts and encourages banks to offer Individual Development Accounts, which match the savings of low-income people.
The most contested provision in the House bill would have opened new government programs to churches and other religious groups. It would have allowed the groups to maintain exemptions from civil rights laws and make hiring and firing decisions based on religion.
It also would have let them continue to skirt local laws that guarantee rights for gays and lesbians.
The Senate bill eliminates this provision, known as charitable choice.
In its place, the bill makes clear that religious groups cannot be denied government contracts simply because they have religious names or because they display religious art, icons, scripture or symbols.
Bush said the legislation will allow religious groups to get grants "without breaching the separation of church and state." Lieberman called their approach "constitutionally appropriate."
Some opponents still were disturbed by the Senate bill.
"It is simply wrong for a publicly funded job-training facility to post a banner that reads, `Only Jesus Saves,"' said Rev. Barry Lynn of Americans United for Separation of Church and State.