House Democrats unveiled a bill Tuesday to resolve the impasse over warrantless wiretapping, offering a compromise on the controversial issue of whether to grant retroactive immunity to the telecommunications firms that took part in the Bush administration’s warrantless surveillance program.

Under the House plan, judges would hear sensitive evidence in secret against the carriers, and Congress would charter a 9/11 commission-style inquiry into possible abuses.

“We were looking for a balance and I think that’s what we’ve achieved,” said Rep. Barbara Lee (D-Calif.), who was one of those who spoke.

The proposal quickly won the support of Senate Majority Leader Harry Reid (D-Nev.), who called it a “tremendous step forward.” If Reid will bring it up on the floor, his move could force Senate Republicans to filibuster the bill to prevent it from going to President Bush’s desk. The Senate passed in February a bill overhauling the 1978 Foreign Intelligence Surveillance Act (FISA), and it includes immunity for carriers. A version that the House passed last fall does not.

“It seems to me so unfair for the president and his people not to be working on this piece of legislation, especially when they say FISA should be extended,” Reid said.

In addition, the chairman of the Senate Intelligence Committee, Jay Rockefeller (D-W.Va.), said Tuesday that the House bill reflects progress, but “considerable work remains.”

“As soon as the House sends us this new bill, we will once again roll up our sleeves and get back to work on a final compromise that the House, Senate and White House can support,” said Rockefeller, who backs retroactive immunity and whose support is key for any bicameral deal.

But the Bush administration quickly rejected the bill as a “step backward.”

“If reports are accurate, the House Democratic leadership’s proposal has a number of serious flaws which would make it dead on arrival,” said the statement from the White House press office.

House Republicans joined in, also calling the deal “dead on arrival.” They also tried again to immediately bring the White House-backed Senate surveillance bill to the floor.

House Democrats for weeks have been resisting demands from the White House and Republicans to give immunity to the carriers, which face around 40 lawsuits citing civil liberties violations.

The House legislation rejects that immunity, but would allow the companies to defend themselves by submitting evidence that can be viewed by judges in secret. Democrats said this can already be done in criminal cases, but not in the civil cases that the companies face.

House Majority Leader Steny Hoyer (D-Md.), who has accused the administration of pushing for immunity to cover its own wrongdoing, said that telecommunications firms have a reasonable argument that they have not been able to defend themselves in court.

“This is a compromise that gives them the opportunity to have what they ought to have,” Hoyer said.

The bill would also establish a bipartisan panel to investigate the administration’s warrantless wiretapping activities and make recommendations for the future.

It would also say that eavesdropping programs must be approved in advance by the secret FISA court, but would not require advance approval for specific investigations. The Senate bill, by contrast, would allow the government to start new eavesdropping programs without court permission and seek approval retroactively.