The House approved H.R. 7, the Charitable Giving Act, on September 17, by a vote of 408-13. H.R. 7 would provide an estimated $12.7 billion over ten years for tax incentives to encourage charitable giving by individuals and corporations. The Senate approved, 95-5, its version of the bill (S. 476) on April 9. Unlike the House bill, the Senate version would offset $13.2 billion of the $14.6 billion estimated revenue loss from the tax provisions.
The wide margins in both the House and Senate reflect the fact that the controversial elements of the President’s original faith-based initiative were not included in either bill. When the House voted, 233-198, to approve an earlier version of H.R. 7 in 2001, the bill was based largely on the President’s proposal, which would have allowed religious organizations to compete equally with other organizations for federal funds to provide social services (see The Source, 7/20/01). During this year’s consideration, an agreement was reached to drop the provision. Differences between the House and Senate remain, however, including the question of offsets and spending levels for the social services block grant.
Rep. Nancy Johnson (R-CT) commended the chairman “for crafting a bill that will reward average taxpayers for their generosity and eliminate unnecessary barriers to giving. This is a bipartisan bill that will expand our communities’ ability to help each other. However, there are some additional provisions that I hope we will be able to work on with the Senate,” expressing her strong support for the social services block grant.
Rep. Sheila Jackson Lee (D-TX) spoke in favor of the Democratic substitute, citing its inclusion of offsets to the tax cuts and increased spending for the social services block grant, arguing that the substitute “is a fiscally responsible approach for encouraging charitable giving and providing assistance to vulnerable families during these particularly difficult times.”
In addition to the charitable tax provisions, H.R. 7 would authorize $150 million in FY 2004 to provide grants to support “promising social service programs.” The bill also would allow states to devote as much as 10% of federal welfare funds to the social services block grant. H.R. 7 also would provide $33 million in new funding for maternity group homes to receive Transitional Living Project grants for homeless youth.
During consideration of H.R. 7, the House defeated, 203-220, the Democratic substitute offered by Rep. Ben Cardin (D-MD) to increase funding for the social services block grant by $1.1 billion, offset by provisions intended to end abusive tax shelters, similar to the offsets in the Senate bill.
The House also defeated, 201-221, a Democratic motion to recommit the bill by Rep. Richard Neal (D-MA) that would provide the child tax credit approved as part of the tax cut bill (P.L. 108-27) to certain low-income families, as contained in the Senate-passed version of H.R. 1308 (see The Source , 6/6/03).
