Before the Memorial Day recess, the House of Representatives is expected to give priority to legislation aimed at increasing charitable giving, but the Ways and Means Committee will probably not consider the Charity Aid, Recovery, and Empowerment (CARE) Act passed by the Senate last month. House Majority Whip Ray Blunt (R-MO) and Rep. Harold Ford (D-TN) are expected to introduce a bill limited to giving incentives previously considered by the House. The bill is not likely to contain other provisions that are in the Senate version, such as simplification of the lobbying rules for 501(c)(3) organizations, nonprofit accountability measures or restoration of funding for the Social Services Block Grant (SSBG). It is also expected to have provisions not in the Senate bill. While it appears the House will deal with rules for grants to faith-based organizations in separate legislation, several other contentious issues could still derail the CARE Act. These include restoration of $1.3 billion in funding for Title XX of the Social Service Block Grant (SSBG), which was part of the compromise between the White House and Sens. Rick Santorum (R-PA) and Joe Lieberman (D-CT) last year. However, the White House withdrew its support this year after the Senate dropped the faith-based component of the CARE Act. Private foundations are likely to become a major focus of the debate in the House. Foundations have been eager to reduce and simplify an excise tax on net investment income. Currently, the tax ranges between 1% and 2%; the proposal would make a flat 1% tax. At the same time, some committee members are interested in limiting the amount of administrative costs that can be counted toward a foundation's annual 5% grant payout obligation. The net effect would be to increase the 5% payout rate, a proposal many foundations oppose. However, two articles in the San Jose Mercury News last week have drawn more attention to the payout proposal. The two articles draw attention to the salary of the head of a California foundation. The result may be increased interest in the House to link the payout issue with the change in the excise tax. For more information see our summary of the Senate version of CARE Act