The 47-14 vote by the House Appropriations Committee set up a debate next week by the full House on the package. The bill largely mirrors the $87 billion plan that President Bush proposed on Sept. 7.
The Senate also plans to vote on its similar version of the bill next week.
The House committee voted after a pivotal Republican decided against trying to make half the bill's $18.6 billion for Iraqi rebuilding a loan. Rep. Zach Wamp, R-Tenn., said he made the decision after being personally urged to do so by President Bush — and after realizing he lacked the votes to prevail.
"My God," he told reporters before the Appropriations Committee meeting. "If his (Bush's) eyes had been lasers, mine would have been burned out."
Seeking to head off loan supporters, the White House invited numerous committee members for visits in recent days. Administration officials say loans would be a propaganda victory for those who claim the chief U.S. goal has been to control Iraqi oil. It also would place a further burden on that country at a time when it needs all its resources to climb back onto its feet, they say.
The committee voted 36-25 to kill an amendment by Rep. David Obey, D-Wis., that would have shifted $4.6 billion from the bill's Iraqi reconstruction funds to the U.S. military. The money would have improved health care and water supplies for U.S. troops and allowed the Army to increase its size by one division, about 20,000 troops.
It also would have canceled income tax cuts scheduled for the wealthiest 1 percent of Americans, enough to raise $87 billion by the end of the decade and pay for the entire bill.
"Most people in the top 1 percent are patriotic enough to say that's the right thing to do," Obey said.
By voice vote, the committee also added more than $100 million for repairing military facilities in Virginia and Maryland that lawmakers said were damaged by last month's Hurricane Isabel.
The bill pares Bush's $20.3 billion Iraqi reconstruction proposal to $18.6 billion. It proposes $65.2 billion for U.S. military operations in Iraq, Afghanistan and elsewhere, and $21.6 billion in total reconstruction aid.
The bulk of the money in both categories is for Iraq. The bill includes funds for reconstructing Iraq's water and electricity supplies, oil production facilities, army, police, schools and hospitals.
Democrats have said Bush's plan is too generous at a time when domestic programs are being squeezed and the government is amassing record budget deficits.
With Democrats painting some of the expenditures as exorbitant — and some Republicans voicing discomfort as well — the House bill erased several specific items, including spending to restore Iraqi marshlands, purchase $50,000 garbage trucks, create postal ZIP codes and build two prisons at $50,000 per bed.
Leaders of the GOP-led Senate, which is taking a recess this week, hope their chamber will complete work on its version of the bill next week.
A group of Republican senators led by Kay Bailey Hutchison of Texas would structure the assistance as a loan, but Majority Leader Bill Frist, R-Tenn., has said he believes he can defeat it.
Young said congressional leaders want to send the final version of the legislation to Bush before a conference of potential donor nations, which is scheduled for Oct. 23-24 in Madrid, Spain.
Meanwhile, a proposed U.S. resolution to authorize peacekeeping troops for Iraq and to encourage contributions to Iraq's reconstruction is in limbo at the United Nations as the Bush administration tries to reword it in order to win Security Council approval.
State Department spokesman Richard Boucher said Thursday that the administration will keep trying to induce other countries to commit peacekeepers, whether or not the resolution is passed.
Boucher also said he knew of no government suggesting postponement of an international conference in Madrid Oct. 23-24 to raise contributions for Iraq. He declined to predict how much could be raised at the conference.
Secretary of State Colin Powell conferred by telephone, meanwhile, with U.N. Secretary-General Kofi Annan and with Foreign Minister Franco Frattini of Italy, whose government currently is president of the European Union.