[Federal Register: March 5, 2004 (Volume 69, Number 44)]
[Proposed Rules]
[Page 10354-10357]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr05mr04-18]
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Proposed Rules
Federal Register
________________________________________________________________________
This section of the FEDERAL REGISTER contains notices to the public of
the proposed issuance of rules and regulations. The purpose of these
notices is to give interested persons an opportunity to participate in
the rule making prior to the adoption of the final rules.
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[[Page 10354]]
DEPARTMENT OF AGRICULTURE
Office of the Secretary
7 CFR Part 16
RIN: 0503-AA27
Participation of Religious Organizations in USDA Programs
AGENCY: Office of the Secretary, USDA.
ACTION: Proposed rule.
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SUMMARY: The United States Department of Agriculture (USDA) is
proposing to implement executive branch policy that, within the
framework of constitutional church-state guidelines, religious (or
``faith-based'') organizations should be able to compete on an equal
footing with other organizations for USDA assistance. This proposed
rule would augment USDA regulations to bring them into compliance with
this policy and ensure that USDA assistance programs are implemented in
a manner consistent with the requirements of the Constitution,
including the religion clauses of the first amendment.
DATES: Comments on this notice must be received on or before May 4,
2004.
ADDRESSES: Send comments to: Deputy Director, Faith-Based and Community
Initiatives, U.S. Department of Agriculture, Office of the Secretary,
Room 200A, Washington, DC 20250; electronic mail:
courtenay.mccormick@usda.gov.
FOR FURTHER INFORMATION CONTACT: Courtenay McCormick, Deputy Director,
Faith-Based and Community Initiatives, U.S. Department of Agriculture,
Office of the Secretary, Room 200A, Washington, DC 20250; telephone:
202-720-3631 (this is not a toll-free number); electronic mail:
courtenay.mccormick@usda.gov.
SUPPLEMENTARY INFORMATION:
I. Background
Faith-based organizations are an important part of the social
services network of the United States, offering a multitude of social
services to those in need. In addition to places of worship, faith-
based organizations include small nonprofit organizations created to
provide one program or multiple services, as well as neighborhood
groups formed to respond to a crisis or to lead community renewal.
Faith-based groups everywhere, either acting alone or as partners with
other service providers and government programs, serve the poor, and
help to strengthen families and rebuild communities.
All too often, however, Federal, State, and local governments have
not taken full advantage of the partnering possibilities with faith-
based organizations, often due to lack of clarity of the parameters for
such partnerships. In addition, Federal, State, and local governments
have sometimes imposed unwarranted legal or regulatory barriers to the
participation of faith-based organizations in government-funded social
service programs.
President Bush has directed Federal agencies, including USDA, to
take steps to ensure that Federal policy and programs are fully open to
faith-based and community organizations in a manner that is consistent
with the Constitution. Religious organizations, either acting alone or
as partners with other service providers and government programs,
revitalize communities, provide community service, and provide children
and low-income people access to food, a healthful diet, and nutrition
education. The Administration believes that there should be an equal
opportunity for all organizations--both religious and nonreligious--to
participate in Federal programs.
As part of these efforts, President Bush issued Executive Orders
13279 and 13280 on December 12, 2002. Executive Order 13279, published
in the Federal Register on December 16, 2002 (67 FR 77141), provides
equal protection of the laws for faith-based and community
organizations in their relationship with Federal programs. That
Executive Order charged the executive branch's agencies, including
USDA, to give equal treatment to faith-based and community groups that
apply for funds to meet social needs in America's communities. The
President called for an end to discrimination against faith-based
organizations and, consistent with the First Amendment to the
Constitution, ordered implementation of these policies throughout the
executive branch, including, among other things, allowing organizations
to retain their religious autonomy over their internal governance and
composition of boards, and over their display of religious art, icons,
scriptures, or other religious symbols, when participating in
government-funded programs. Executive Order 13280, published in the
Federal Register on December 16, 2002 (67 FR 77145), created a Center
for Faith-Based and Community Initiatives in USDA and charged USDA to
identify and eliminate regulatory, contracting, and other programmatic
barriers to the full participation of faith-based and community
organizations in its programs.
The Executive Orders also charged the Federal agencies, including
USDA, to ensure that all policies incorporated the principles outlined
in Executive Order 13279. This proposed rule is part of USDA efforts to
fulfill its responsibilities under these Executive Orders. In addition,
this proposed rule is designed to ensure that the implementation of
USDA programs is conducted in a manner consistent with the requirements
of the Constitution, including the Religion Clauses of the First
Amendment.
II. This Proposed Rule
A. Purpose of Proposed Rule
Consistent with the President's initiative, this proposed rule
would revise USDA policy and remove unwarranted barriers to the equal
participation of faith-based organizations in USDA grant and
cooperative agreement programs (``assistance programs''). The objective
of this proposed rule is to ensure that USDA assistance programs are
open to all qualified organizations, regardless of their religious
character, and to establish clearly the proper uses to which USDA
assistance may be put, and the conditions for receipt of USDA
assistance.
USDA supports the participation of faith-based organizations in its
programs. This proposed rule will clarify, within the framework of
constitutional guidelines, that faith-based organizations are able to
access and compete on an equal footing with
[[Page 10355]]
other eligible organizations in USDA assistance programs. For purposes
of defining this universe, this rule will apply to all recipients and
subrecipients of USDA assistance covered by 7 CFR parts 3015, 3016, or
3019, the USDA uniform administrative rules for recipients of USDA
assistance.
B. Proposed Rule
1. Participation by Faith-Based Organizations in USDA Assistance
Programs
The proposed rule clarifies that organizations are eligible to
participate in USDA assistance programs without regard to their
religious character or affiliation, and that organizations may not be
excluded from participation in USDA assistance programs simply because
they are religious. Specifically, religious organizations are eligible
to compete for USDA assistance and to access USDA assistance programs
on the same basis, and under the same eligibility requirements, as all
other nonprofit organizations. In selecting service providers, the
Federal government and State and local governments administering
support under USDA assistance programs are prohibited from
discriminating for or against organizations on the basis of religion or
their religious character. However, nothing in the rule precludes those
administering USDA-supported assistance programs from accommodating
religious organizations in a manner consistent with the Establishment
Clause.
Major international food assistance and development programs of the
United States are, by statute, carried out by the United States Agency
for International Development (USAID) using the funds and authorities
of the Commodity Credit Corporation. This rule encompasses activities
of the Corporation that are carried out by the Secretary of Agriculture
but does not include those activities of the Corporation carried out by
USAID.
2. Inherently Religious Activities
The proposed rule states that a participating organization may not
use USDA direct assistance \1\ to support inherently religious
activities, such as worship, religious instruction, or proselytization.
If the organization engages in such activities, the activities must be
offered separately, in time or location, from the programs or services
funded or supported with USDA direct assistance, and participation must
be voluntary for the beneficiaries of the program or services funded or
supported by USDA. This requirement ensures that USDA direct assistance
provided to a participating organization may not be used, for example,
to conduct prayer meetings, worship services, or any other activity
that is inherently religious.
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\1\ As used in this proposed rule, the terms ``direct USDA
assistance'' refers to direct funding within the meaning of the
Establishment Clause of the First Amendment. For example, direct
USDA funding may mean that the government or an intermediate
organization with similar duties as a governmental entity under a
particular USDA program selects an organization and purchases the
needed services straight from the organization. In contrast,
indirect funding scenarios may place the choice of service provider
in the hands of a beneficiary, and then pay for the cost of that
service through a voucher, certificate, or other similar means of
payment.
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This restriction does not mean that an organization that receives
USDA direct assistance cannot engage in inherently religious
activities. It simply means such an organization cannot support these
activities with USDA direct assistance. Thus, faith-based organizations
that receive USDA direct assistance must take steps to separate, in
time or location, their inherently religious activities from the USDA-
supported services that they offer.
These restrictions on inherently religious activities do not apply
to funds or benefits received from USDA indirectly, such as where USDA
funding or benefits are provided to religious organizations as a result
of a genuine and independent private choice of a beneficiary (and
provided the participating religious organizations otherwise satisfy
the requirements of the program). A religious organization may receive
such funds as the result of a beneficiary's genuine and independent
choice if, for example, a beneficiary redeems a voucher, coupon,
certificate, or similar funding mechanism that was provided to that
individual using USDA funds or benefits when there is a choice among
providers. Such funds or benefits are not ``direct'' funds within the
meaning of the Establishment Clause or ``USDA direct assistance''
within the meaning of this rule.
3. Independence of Faith-Based Organizations
The proposed rule clarifies that a religious organization that
participates in USDA programs and activities will retain its
independence and may continue to carry out its mission, including the
definition, practice, and expressions of its religious beliefs,
provided that it does not use USDA direct assistance to support any
inherently religious activities, such as worship, religious
instruction, or proselytization. Among other things, faith-based
organizations may use space in their facilities to provide USDA-
supported services, without removing religious art, icons, scriptures,
or other religious symbols. In addition, a faith-based organization
receiving USDA assistance may retain religious terms in its
organization's name, select its board members and otherwise govern
itself on a religious basis, and include religious references in its
organization's mission statements and other governing documents. The
proposed rule would also clarify that a faith-based organization's
exemption from the federal prohibition on employment discrimination on
the basis of religion, set forth in section 702 of the Civil Rights Act
of 1964 (42 U.S.C. 2000e-1)--which allows religious organizations to
employ individuals of a particular religion without violating Title VII
of that Act--is not forfeited when the organization participates in a
USDA assistance program. This provision helps enable faith-based groups
to promote common values, a sense of community and unity of purpose,
and shared experience through service--all of which can contribute to a
faith-based organization's effectiveness. It thus helps protect the
religious liberties of communities of faith. In keeping with the
guarantees of institutional autonomy, the proposed regulation reflects
Congress's recognition that a religious organization may determine
that, in order to define or carry out its mission, it is important that
it be able to take its faith into account in making employment
decisions.
4. Nondiscrimination in Providing Assistance
The proposed rule clarifies that an organization that receives
direct assistance from USDA shall not, in providing program assistance,
discriminate against a program beneficiary or prospective program
beneficiary on the basis of religion or religious belief. Accordingly,
religious organizations, in providing services supported in whole or in
part by USDA direct assistance, may not discriminate against current or
prospective program beneficiaries on the basis of religion or a
religious belief. The purpose of this rulemaking is to eliminate undue
administrative barriers that USDA may have imposed to the participation
of faith-based organizations in USDA assistance programs; it is not to
alter existing statutory requirements, which will continue to apply to
USDA assistance programs to the same extent that they applied prior to
adoption of this proposed rule in final form.
USDA domestic nutrition programs, including but not limited to
those
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established under the Richard B. Russell National School Lunch Act, 42
U.S.C. 1751 et seq., and the Child Nutrition Act of 1966, 42 U.S.C.
1771 et seq., have long benefited from the strong participation of
faith-based and community-based schools and similar organizations
delivering healthful foods and nutritious meals to our school children.
The Federal funds and commodities used in the delivery of the domestic
nutrition programs rely on participating organizations to ensure the
benefits reach individuals as the ultimate program beneficiaries.
Supreme Court jurisprudence has long noted that the provision of
school lunch assistance to parochial schools is permissible under the
Establishment Clause. See, e.g., Lemon v. Kurtzman, 403 U.S. 602, 616
(1971). In order to avoid any interpretation of section 16.3(a) that
would infringe on admissions policies of religious schools, programs
under the National School Lunch Act, the Child Nutrition Act, and
international school feeding programs under various authorities
available to the Commodity Credit Corporation and USDA are exempt from
the provisions of that paragraph.
5. Structures Used for Religious Activities
The proposed rule would also clarify that USDA direct assistance
funds may not be used for acquisition, construction, or rehabilitation
of structures to the extent that those structures are used for
inherently religious activities. USDA direct assistance funds may be
used for the acquisition, construction, or rehabilitation of structures
only to the extent that those structures are used for conducting
eligible activities under specific USDA programs. Where a structure is
used for both eligible and inherently religious activities, the
proposed rule clarifies that USDA direct assistance funds may not
exceed the cost of those portions of the acquisition, construction, or
rehabilitation that are attributable to eligible activities.
Sanctuaries, chapels and other rooms that a USDA-funded religious
organization uses as its principal place of worship, however, are
ineligible for USDA-funded improvements. Of course, USDA direct
assistance funds may be used for acquisition, construction, or
rehabilitation of structures only to the extent authorized by the
applicable program statutes and regulations. Disposition of real
property after the term of the grant or cooperative agreement, or any
change in use of the property during the term of the grant or
cooperative agreement, is subject to government-wide regulations
governing real property disposition (see 7 CFR parts 3015, 3016, and
3019).
In addition to the restrictions on structures, faith-based
organizations, like all other organizations receiving USDA assistance,
are subject to restrictions on the use of such funds for equipment,
supplies, labor, indirect costs and similar costs of regular
maintenance and oversight. USDA assistance may be used only for that
portion of these costs that support program activities. For example, if
an employee of a faith-based organization is responsible for operating
a USDA-funded program and for operating an inherently religious
activity, that employee's salary and benefits must be pro-rated based
on the amount of their time spent on each activity. The proposed rule
clarifies that any laws, regulations, and guidance on the allowable
program costs apply to faith-based organizations the same as any other
organization.
III. Findings and Certifications
Executive Order 12866--Regulatory Planning and Review
The proposed rule is issued in conformance with Executive Order
12866 on Regulatory Planning and Review. The Office of Management and
Budget (OMB) has determined that this is a significant regulatory
action as defined by Executive Order 12866. Accordingly, OMB has
reviewed this proposed rule.
Unfunded Mandates Reform Act
Title II of the Unfunded Mandates Reform Act of 1995 (2 U.S.C.
1531-1538) establishes requirements for Federal agencies to assess the
effects of their regulatory actions on state, local, and tribal
governments and the private sector. This proposed rule does not impose
any Federal mandates on any state, local, or tribal governments or the
private sector within the meaning or Unfunded Mandates Reform Act of
1995.
Executive Order 13132, Federalism
Executive Order 13132, Federalism, requires that Federal agencies
consult with state and local governments and their officials in the
development of regulatory policies with federalism implications.
Consistent with Executive Order 13132, we specifically solicit comment
from state and local government officials on this proposed rule.
Regulatory Flexibility Act
The Secretary, in accordance with the Regulatory Flexibility Act (5
U.S.C. 605(b)), has reviewed and approved this proposed rule and in so
doing certifies that this rule will not have a significant economic
impact on a substantial number of small entities. The proposed rule
would not impose any new costs, or modify existing costs, applicable to
USDA assistance recipients. Rather, the purpose of the proposed rule is
to remove policy prohibitions that currently restrict equal
participation of faith-based organizations in USDA assistance programs.
Notwithstanding the Department's determination that this rule will not
have a significant economic effect on a substantial number of small
entities, the Department specifically invites comments regarding any
less burdensome alternatives to this rule that will meet the
Department's objectives as described in this preamble.
Government Paperwork Elimination Act
USDA is committed to compliance with the Government Paperwork
Elimination Act (Pub. L. 105-277), which requires government agencies
to provide the public the option of submitting information or
transacting business electronically to the maximum extent possible.
Paperwork Reduction Act
The Paperwork Reduction Act of 1995 (44 U.S.C. Chap. 35; see 5 CFR
1320) requires that the Office of Management and Budget (OMB) approve
all collections of information by a Federal agency from the public
before they can be implemented. There is no additional information
collection burden imposed by this Proposed Rule.
List of Subjects in 7 CFR Part 16
Administrative practice and procedure, Agriculture, Grant programs,
Reporting and recording-keeping requirements.
For the reasons stated in the preamble, USDA proposes to add part
16 of Title 7 of the Code of Federal Regulations as follows:
PART 16--PARTICIPATION OF RELIGIOUS ORGANIZATIONS IN USDA PROGRAMS
16.1 Purpose and applicability.
16.2 Rights of religious organizations.
16.3 Responsibilities of religious organizations.
16.4 Effect on State and local funds.
16.5 Compliance.
Authority: 5 U.S.C. 301; E.O. 13279, 67 FR 77141, 3 CFR, 2002
Comp., p.258; E.O. 13280, 67 FR 77145, 3 CFR, 2002 Comp., p. 262.
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Sec. 16.1 Purpose and applicability.
(a) The purpose of this part is to set forth USDA policy regarding
equal participation of religious organizations in USDA assistance
programs for which non-profit organizations are eligible.
(b) Except as otherwise specifically provided in this part, the
policy outlined in this part applies to all recipients and
subrecipients of USDA assistance to which 7 CFR parts 3015, 3016, or
3019 apply, and recipients and subrecipients of Commodity Credit
Corporation assistance that is administered by agencies of USDA.
Sec. 16.2 Rights of religious organizations.
(a) A religious organization is eligible, on the same basis as any
other eligible non-profit organization, to access and participate in
USDA assistance programs. Neither the Federal government nor a State or
local government receiving USDA assistance shall, in the selection of
service providers, discriminate for or against a religious organization
on the basis of the organization's religious character or affiliation.
(b) A religious organization that participates in USDA programs
will retain its independence and may continue to carry out its mission,
including the definition, practice, and expression of its religious
beliefs, provided that it does not use USDA direct assistance to
support any inherently religious activities, such as worship, religious
instruction, or proselytization. Among other things, a religious
organization may:
(1) Use space in its facilities to provide services and programs
without removing religious art, icons, scriptures, or other religious
symbols,
(2) Retain religious terms in its organization's name,
(3) Select its board members and otherwise govern itself on a
religious basis, and
(4) Include religious references in its organizations' mission
statements and other governing documents.
(c) In addition, a religious organization's exemption from the
Federal prohibition on employment discrimination on the basis of
religion, set forth in section 702(a) of the Civil Rights Act of 1964,
42 U.S.C. 2000e-1, is not forfeited when an organization receives USDA
assistance.
Sec. 16.3 Responsibilities of religious organizations.
(a) An organization that participates in programs and activities
supported by USDA direct assistance programs shall not discriminate
against a program beneficiary or prospective program beneficiary on the
basis of religion or religious belief.
(b) Nothing in paragraph (a) shall be construed to prevent
religious organizations that receive USDA assistance under the Richard
B. Russell National School Lunch Act, 42 U.S.C. 1751 et seq., the Child
Nutrition Act of 1966, 42 U.S.C.1771 et seq., or USDA international
school feeding programs from considering religion in their admissions
practices.
(c) Organizations that receive direct assistance funds from USDA
under any USDA program may not engage in inherently religious
activities, such as worship, religious instruction, or proselytization,
as part of the programs or services supported with direct assistance
from USDA. If an organization conducts such activities, the activities
must be offered separately, in time or location, from the programs or
services supported with direct assistance from USDA, and participation
must be voluntary for beneficiaries of the programs or services
supported with such direct assistance. These restrictions on inherently
religious activities do not apply where USDA funds or benefits are
provided to religious organizations as a result of a genuine and
independent private choice of a beneficiary or through other indirect
funding mechanisms, provided the religious organizations otherwise
satisfy the requirements of the program.
(d)(1) USDA direct assistance funds may not be used for the
acquisition, construction, or rehabilitation of structures to the
extent that those structures are used by the USDA funding recipients
for inherently religious activities. USDA direct assistance funds may
be used for the acquisition, construction, or rehabilitation of
structures only to the extent that those structures are used for
conducting activities and only to the extent authorized by the
applicable program statutes and regulations. Where a structure is used
for both eligible and inherently religious activities, USDA direct
assistance funds may not exceed the cost of those portions of the
acquisition, construction, or rehabilitation that are attributable to
eligible activities in accordance with the cost accounting requirements
applicable to USDA funds. Sanctuaries, chapels, or other rooms that an
organization receiving direct assistance funds from USDA uses as its
principal place of worship, however, are ineligible for USDA-funded
improvements. Disposition of real property after the term of the grant
or any change in use of the property during the term of the grant is
subject to government-wide regulations governing real property
disposition (see 7 CFR parts 3016 and 3019).
(2) Any use of USDA assistance funds for equipment, supplies,
labor, indirect costs and the like shall be prorated between the USDA
program or activity and any use for other purposes by the religious
organization in accordance with applicable laws, regulations, and
guidance.
(3) Nothing in this section shall be construed to prevent the
residents of housing receiving USDA assistance funds from engaging in
religious exercise within such housing.
Sec. 16.4 Effect on State and local funds.
If a State or local government voluntarily contributes its own
funds to supplement activities carried out under programs governed by
this part, the State or local government has the option to separate out
the USDA assistance funds or commingle them. If the funds are
commingled, the provisions of this part shall apply to all of the
commingled funds in the same manner, and to the same extent, as the
provisions apply to the USDA assistance funds.
Sec. 16.5 Compliance.
USDA agencies will monitor compliance with this part in the course
of regular oversight of USDA programs.
Ann M. Veneman,
Secretary of Agriculture.
[FR Doc. 04-5092 Filed 3-4-04; 8:45 am]
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