House and Senate Republicans said they also would get rid of a loophole under which companies that locate overseas to avoid paying taxes could still compete for federal contracts, and would revise language that gave one university, Texas A&M, special access to federal research money.
Senate Majority Leader Bill Frist, R-Tenn., who supported the original vaccine provision and said he still hopes to take up the issue later this year in more comprehensive legislation, said he would include the special interest eliminations in a fiscal 2003 spending bill the Senate will take up this month.
Objections to the last-minute inclusion of the provisions, led by Democrats and several Republicans, nearly blocked passage of the Homeland Security bill, a priority for the Bush White House last year.
The most controversial was the language shielding vaccine makers from lawsuits concerning the use of the compound Thimerosal by requiring that claims go through a special federal program that pays limited damages for vaccine-related injuries, rather than through the courts.
Indianapolis-based Eli Lilly and Co. was the biggest manufacturer of Thimerosal, a mercury-containing preservative once added to some childhood vaccines. The drug company said it had lobbied for the measure but had no role in its placement in the homeland security bill.
Parents of children with autism have filed lawsuits claiming that Thimerosal caused the children to develop the disease, and they strongly protested the limitations on their legal options.
"I promised those parents I would fight to remove this provision and I will fight to ensure the legislation announced today does that job," said Sen. Debbie Stabenow, D-Mich.
Lilly, in a statement, said it was disappointed by the decision to repeal the vaccine provision but pleased by the promise to take up comprehensive vaccine legislation in the first half of 2003. It said there is no scientific evidence linking Thimerosal to autism.
Sen. Olympia Snowe, R-Maine, said she was "very pleased with the agreement we have reached to eliminate the most egregious of these provisions."
Snowe and two other Republican moderates, Susan Collins of Maine and Lincoln Chafee of Rhode Island, worked with the leadership to reach the agreement. The three had agreed to vote for the homeland security bill only after then-GOP leader Trent Lott said the party would revisit the special interest issues early in 2003.
"This is a positive sign of Senator Frist's willingness to work with moderates within the party," Chafee said of the new majority leader.
John Feehery, spokesman for House Speaker Dennis Hastert, R-Ill., said Hastert backed the agreement. House Majority Leader Tom DeLay's spokesman, Stuart Roy, said DeLay, R-Texas, had helped craft the deal.
Ranit Schmelzer, spokeswoman for Senate Democratic leader Tom Daschle of South Dakota, said Democrats were not consulted. She said removing the vaccine provision "is exactly what Democrats had called for in November, and it makes us wonder why they didn't join us then."
She noted that the agreement did not address four other special interest provisions that Democrats opposed, including liability protections for airport screening companies.
The late Sen. Paul Wellstone, D-Minn., worked to put language in the homeland security bill that barred companies using offshore tax havens from competing for contracts, but last-minute language was added to give the head of the new department broad authority to ignore that prohibition. The agreement specifies that waivers can be given only those companies deemed essential to national security.