As Prime Minister Olmert prepares for his first official meeting with President Bush since his election in March, a clash is emerging between Congress and the White House over whether America should have formal diplomatic relations with the Palestinian Authority now that it is effectively controlled by the terrorist group Hamas.

The House of Representatives this morning is set to pass the Palestinian Anti-Terrorism Act of 2006, legislation that would instruct the State Department to cut ties with Palestinian Authority officials and restrict everything except the barest of humanitarian aid to the Palestinian Arabs.

Unlike other legislation supported by the pro-Israel lobby in Washington, the bill under consideration has little in the way of waiver authority for the president to overrule the intentions of Congress.

The lack of broad waiver authority is one of the main objections the White House has given, in a formal statement of administration policy on the legislation, for opposing the law for now.

But congressional officials also are confirming a report this month in the Jerusalem Post that said the State Department sent a memo to key lawmakers outlining other reasons the bill would make poor foreign policy. Among them is language in the bill that would restrict diplomacy with Palestinian Authority officials, even if they were not members of Hamas – a group America and the European Union consider a terrorist organization – which won legislative elections in January.

The proposed legislation would only allow for these contacts once Hamas renounced terror and recognized Israel. It would also instruct the Treasury Department to close down the Palestinian Authority missions in Washington and New York, though it would provide the president a waiver in this case.

The pending showdown over the bill illustrates how Mr. Bush has begun to give way in recent weeks to some of his policy critics. In the last month, the president has authorized his secretary of state to normalize relations with Libya, despite the regime’s failure to release its leading human rights activist, Fathi Eljahmi.

In Egypt, the American Embassy failed to question President Mubarak about the fate of two judges who were tried last week in disciplinary hearings, ostensibly as punishment for their efforts to investigate fraud in last November’s parliamentary elections.

And in the international arena, the State Department has tacitly signed off on another round of back-channel efforts to entice Iran voluntarily to suspend the enrichment of uranium.

At the same time, the fight over new sanctions against the Palestinian Authority illustrates a renewed challenge to the American Israel Public Affairs Committee.

The lobby has come under attack in academic circles since the publication of a Harvard Kennedy School working paper alleging that a vast pro-Israel lobby that includes Aipac helped manipulate the American public and government into waging war against Saddam Hussein. This week, the New York Review of Books published an article criticizing the way in which the lobby has punished its enemies in Congress and the Jewish community.

In Congress, the legislative battle over the Palestinian Anti-Terrorism Act has driven a handful of lawmakers into open opposition. Rep. Betty McCollom, a Democrat of Minnesota, demanded a public apology this month from Aipac after reading comments from one of its supporters who said her opposition to the bill was paramount to “support for terrorists.”

Rep. Gary Ackerman, a Democrat of New York who has often been a reliable vote for pro-Israel legislation, compared the attack on his colleague to the tactics of the Taliban.

Yesterday, the office of Rep. Earl Blumenauer, a Democrat of Oregon, sent an e-mail to reporters announcing that the congressman would lead the fight against the Aipac-backed legislation. In a statement, Mr. Blumenauer said, “By placing permanent restrictions on the tools that the United States can use to promote Palestinian reform and Israeli security, this is the wrong answer to a most difficult challenge.”

One congressional source confirmed yesterday that the Democratic Congressional Campaign Committee has asked that the legislation receive more votes from the minority party than the Republicans.

Some dovish pro-Israel organizations have also come out against the bill. The president of the Israel Policy Forum, Seymour Reich, acknowledged yesterday that while public statements from Israel’s ambassador and foreign minister have supported the House’s legislative efforts, “All indications from Jerusalem is that they want flexibility and they want to provide humanitarian aid to the Palestinians,” he said.

As the leader of a delegation from his organization, Mr. Reich met with Mr. Olmert in April and, along with Jewish leaders, he met the national security adviser, Stephen Hadley, last week,

Yesterday, a spokesman for Aipac, Josh Block, said in a statement: “This legislation sets out a clear path for the Hamas government: end your support for terrorism and recognize Israel’s right to exist and you will be recognized as a legitimate member of the international community. But until those conditions are met, the United States will not allow American taxpayer dollars to be used to support or legitimize a terrorist-led Palestinian Authority.”

Mr. Olmert, who arrived in Washington on Sunday night, is due to meet today with Mr. Bush at the White House.