W By Laura Sullivan

ASHINGTON – Despite fierce opposition from the FBI, support is growing in Washington for the creation of a domestic intelligence agency that could take over intelligence gathering and counterterrorism from the bureau.

The idea will likely get its strongest boost this week when the joint congressional intelligence committee investigating the Sept. 11 attacks unveils its recommendations, including one that stops just short of endorsing the proposal and calls for a year-long study of the concept.

At issue is whether the FBI, historically a law enforcement agency charged with combating such mainstream crimes as bank robbery and drug trafficking, should continue trying to recast itself as one-stop shopping for terrorism prevention or whether that job could be better handled by a separate agency with that single mission.

FBI Director Robert Mueller and many bureau officials – as well as civil libertarians – are against forming such an agency, which could be modeled after MI5, the British domestic intelligence service.

Civil liberties groups fear such an agency would bring back the days of domestic spying on Americans and would have little or no oversight to protect citizens from unwarranted wiretaps or other violations of their privacy.

But the FBI, weakened by persistent criticism and waning support on Capitol Hill, may not be able to fend off the appeal of a new agency, which could become part of a Cabinet department such as the Department of Homeland Security or an independent agency like the CIA.

In recent months, the FBI has lost the confidence of some congressional leaders who believe the bureau has not moved fast enough to combat terrorism and that the United States is no safer today than it was before the Sept. 11 attacks.

Some of the most vocal support for a new agency has come from Sen. John Edwards, D-N.C., who said in a recent speech that the FBI has not been able to accomplish what a separate agency could. Last week he visited Britain’s MI5 agency for a tour.

“The law enforcement impulses of the FBI consistently trump intelligence needs,” he said. “Instead of attempting to turn the FBI into something it isn’t, we should establish a new agency that is focused on gathering intelligence about terrorist threats here at home.”

Sen. Bob Graham, D-Fla., and a co-chairman of the joint House-Senate investigating committees, asked Mueller to come to his office several weeks ago to discuss the idea and whether the bureau is accomplishing its new anti-terrorism mission. A Graham aide, Paul Anderson, said the senator was only “somewhat more satisfied” after the meeting that the bureau was doing a better job and could handle the task.

Both Graham and Sen. Richard Shelby, R-Ala., another of the panel’s co-chairmen, have said on recent talk shows that they support exploring the idea of a separate agency, citing the FBI’s ingrained culture of law enforcement. Graham, however, said he supports the idea as long as the proposed agency was empowered to spy only on foreigners in the United States, not U.S. citizens.

Forming such an agency would be a major threat to the bureau, which has spent the past year restructuring itself to combat the terrorist threat. Terrorism is now the bureau’s number one priority, with much of its traditional work in areas such as organized crime and drug trafficking taking a back seat or being passed on to other agencies, including the Drug Enforcement Administration.

Without terrorism, several bureau officials said, the FBI could seem irrelevant next to a new domestic intelligence agency. Some of those concerns are already playing out with the new Homeland Security Department’s plans to create a special unit to analyze intelligence from the FBI and other intelligence agencies.

The unit within Homeland Security is to review intelligence reports and, in some cases, raw data from the field to look for patterns and seek out terrorist activity. The FBI has spent the past year building its own almost identical unit, borrowing agents from the CIA to do so.

Homeland Security’s plans taken together with talk of a new agency has left some FBI officials feeling besieged. Officials are planning to mount a counterattack this week, pulling together talking points to debunk the idea of a clone of MI5 and similar agencies in Canada and Australia.

“Proponents of an MI5-type agency often idealize the concept but ignore the reality,” said bureau spokesman Bill Carter. “There have been many problems (with such agencies).” He said that officials from some countries have been asking the FBI for advice on how to model their domestic intelligence agencies more like the bureau.

“It would be extremely disruptive, time consuming and expensive to set up a new agency,” he said. “The FBI has changed dramatically since the attacks and is on the cusp of where it needs to be to lead the fight against the war on terrorism.”

But others aren’t so sure. A task force of former intelligence and technology experts fashioned by the Markle Foundation, a New York-based think tank, said in an October report that the FBI should not be the lead agency in collecting and analyzing terrorism-related intelligence.

“The FBI has a huge amount to do trying to pursue terrorism and law enforcement,” said Zoe Baird, the Markle chairwoman. “It’s not surprising they haven’t been able to do both.”

A study of a possible separate agency is one of several proposals expected to be unveiled as early as Wednesday as part of the joint congressional committees’ report on its investigation into the attacks. Committee staffers said they expect the issue of creating a new agency to be one of the more contentious issues.

The draft report, based on hearings throughout the summer and fall, also calls for a new Cabinet-level director of national intelligence who would outrank the director of central intelligence, who on paper oversees a dozen or so intelligence agencies but in reality only has all-important budgetary authority over the CIA .

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Other recommendations include reviewing whether to expand surveillance laws and establishing procedures to reward agency employees whose actions help thwart attacks.

The biggest hurdle for a domestic intelligence agency could come from civil libertarians.

“Would we return to the bad old days of (former FBI director J. Edgar) Hoover doing surveillance on dissenting Americans and those that don’t agree with American policy?” asked Steven Aftergood, a senior research analyst who monitors intelligence policy at the Federation of American Scientists. “Would a new agency have the vigorous oversight it needs? There are real questions.”