By Thomas Ferraro

WASHINGTON (Reuters) - A second House Democrat called on Representative Charles Rangel to resign on Tuesday while the lawmaker raced the clock to see if a deal could be reached to settle ethics charges against him.

Time is running out. A House ethics panel is set to specify the charges against Rangel, one of the most senior members of Congress, at a preliminary public hearing on Thursday in advance of a September trial.

Democrats fear that the trial could become a political circus and undermine their efforts to retain control of the House of Representatives in the November election.

Rangel's attorneys have talked to nonpartisan committee staffers about a possible settlement that would allow him to avoid a trial, according to the office of Representative Zoe Lofgren, chairman of the House Ethics Committee. A Rangel aide said, "It's lawyer to lawyer."

For nearly two years the ethics panel has been examining a number of matters, including whether Rangel failed to pay taxes on a villa in the Dominican Republic and improperly solicited donations to a college center named in his honor. It announced unspecific allegations last week after an earlier breakdown in negotiations.

Rangel stepped down in March as chairman of the House's tax-writing committee after the ethics panel, in a separate case, admonished the 80-year-old lawmaker for corporate-sponsored trips in 2007 and 2008 in violation of House gift rules.

He has publicly denied any wrongdoing and says he welcomes the opportunity to clear himself.

A possible deal could include Rangel's admission to at least some charges in return for a public admonishment or censure rather than expulsion from Congress.

Any deal would have to be approved by the bipartisan ethics committee, composed of three Democrats and three Republicans.

Representative Walt Minnick, in becoming just the second House Democrat to call for Rangel to step down, said, "Now that the investigation is complete and provided the facts are as alleged, I think it's clear that he should resign." Rep. Betty Sutton of Ohio was the first.

"Everybody is uncomfortable about this," said a House Democrat who asked not to be identified by name. "I think we can keep the House, but we don't want it jeopardized by this."

The matter is already a distraction as evidenced by House Democratic Leader Steny Hoyer's weekly news conference. Hoyer began the session rattling off his party's legislative accomplishments. When he stopped for questions, he was hit by a number about Rangel.

Asked if Rangel should resign, Hoyer replied: "Mr. Rangel has to do what Mr. Rangel believes is appropriate and proper."

(Editing by Jackie Frank)