BY ANA RADELAT
 Special to the Herald

 WASHINGTON -- After taking a second look, many supporters of easing trade
 sanctions against Cuba have begun to back away from a House deal that would
 allow the first U.S. food sales to Fidel Castro's government in 38 years.

 The doubts have splintered a coalition of farm and business groups and liberal
 Democrats seeking to ease the embargo, endangering the prospects for
 congressional approval.

 Weighing the increasing questions about the proposal's fate, Dennis Hays, vice
 president of the Cuban American National Foundation, cautioned that ``this
 legislation has by no means cleared all hurdles.''

 After the agreement was reached with great fanfare late last month, some
 business groups, including the U.S. Chamber of Commerce, labeled it a
 breakthrough in U.S. relations with Cuba. But a closer look at the deal's
 restrictions have led some of these same industry groups to abandon their
 support.

 Chamber of Commerce President Thomas Donohue this week called it a
 ``Christmas tree'' that's decorated with provisions that are bad for U.S. business.
 Others, including a national organization of small farmers, complain that it would
 prevent American producers from fairly competing with farmers from other nations
 for Cuba's market.

 The deal was reached because House GOP leaders were seeking to put an end
 to a battle in their ranks. Rep. George Nethercutt, R-Wash., and other
 Republicans seeking new markets for their farmers led the anti-sanctions
 campaign. But they were bitterly opposed by other GOP lawmakers, including
 Reps. Lincoln Díaz-Balart, R-Miami, and Ileana Ros-Lehtinen, R-Miami, who want
 no opening to trade with Cuba.

 After long negotiations, the so-called Nethercutt deal was reached. It would
 remove restrictions on the sale of food and medicine to Cuba, Iran, Libya, North
 Korea and Sudan -- countries on the State Department's terrorist nations list --
 and prevent the president from imposing a ban on U.S. food and medical sales in
 future sanctions packages.

 But the agreement would also bar the use of private or U.S. government loans or
 credit guarantees in the sales to Cuba or Iran and prohibit U.S. insurance
 companies from protecting agricultural shipments to Cuba or Iran.

 The food and medicine deal would also require that sales to Cuba and Iran be
 licensed by the Treasury Department on a case-by-case basis. This alarmed
 some business interests because current licensing rules for Iran sales are more
 relaxed.

 In addition, the Nethercutt deal would strip the president of his authority to allow
 more Americans to travel to Cuba, a provision favored by Congressional liberals
 and key ingredient of the administration's existing policy toward Cuba.

 Americans eligible to go Cuba now include journalists, Cuban Americans,
 academics, amateur athletes, government officials as well as others. Clinton's
 ``people-to-people'' policy resulted in a sharp increase in American travel to Cuba
 -- from 55,900 in 1998 to 82,000 last year.

 Under the so-called Nethercutt deal, those categories would be locked into law
 and another one added: businessmen and farmers trying to broker contracts with
 the Cuban government for food and medical sales would be allowed to apply for
 individual travel licenses.

 Diaz-Balart and Ros-Lehtinen, who both insisted on the travel provision, have said
 it is better than current law because it would prevent any president from allowing
 U.S. tourists to visit Cuba.

 ``What I want is to avoid the expansion of hard currency to Cuba,'' Diaz-Balart
 explained.

 However, most of the mounting criticism of the Nethercutt provision centers on its
 restrictions on sales.

 John Kavulich, head of the U.S.-Cuba Trade and Economic Council, said the
 restrictions have left some U.S. food exporters ambivalent about whether they can
 fairly compete against foreign suppliers of grain and other agricultural products to
 Cuba. Nevertheless, Kavulich called the deal an unprecedented opening to
 Castro's government.

 ``Are there export opportunities in this legislation that don't exist now? The
 answer is `yes,' '' Kavulich said.

 But the National Farmers Union, which represents the nation's small farmers, said
 the House deal ``so restricts the sale of food and medicine to U.S. producers that
 it will be virtually impossible for us to compete with other nations.''

 In addition, Sen. Byron Dorgan, D-N.D., called the Nethercutt deal a ``legislative
 hoax'' and a ``giant step backward for sanctions reform.''

 Joined by Sen. Chris Dodd, D-Conn., and other Democrats in the Senate, Dorgan
 hopes to derail the agreement in favor of a provision contained in the Senate farm
 spending bill that doesn't contain travel or finance restrictions.