[Federal Register Volume 68, Number 189 (Tuesday, September 30, 2003)]
[Proposed Rules]
[Pages 56386-56390]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 03-24296]



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Part II





Department of Labor





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Office of the Secretary



29 CFR Part 37



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Employment and Training Administration

20 CFR Part 667



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Use of Federal Financial Assistance for Religious Activities Under the 
Nondiscrimination and Equal Opportunity Provisions of the Workforce 
Investment Act of 1998; Proposed Rule

  Federal Register / Vol. 68, No. 189 / Tuesday, September 30, 2003 / 
Proposed Rules  

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DEPARTMENT OF LABOR

Office of the Secretary

29 CFR Part 37

Employment and Training Administration

20 CFR Part 667

RIN 1291-AA29


Use of Federal Financial Assistance for Religious Activities 
Under the Nondiscrimination and Equal Opportunity Provisions of the 
Workforce Investment Act of 1998

AGENCY: Office of the Secretary and Employment and Training 
Administration, Labor.

ACTION: Notice of proposed rulemaking.

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SUMMARY: The Department of Labor is proposing to amend the interim 
final regulations that implement the equal opportunity and 
nondiscrimination provisions of the Workforce Investment Act of 1998 
(WIA). Today's proposal would revise a provision in the interim final 
regulations that prohibits the use of all types of WIA Title I 
financial assistance for the employment or training of participants in 
religious activities. Further, the Department of Labor is proposing to 
amend the regulations that implement the general provisions of WIA, to 
conform those regulations to the proposed changes to the interim final 
regulations implementing the equal opportunity and nondiscrimination 
provisions of WIA.

DATES: To be assured of consideration, comments must be in writing and 
must be received on or before December 1, 2003.

ADDRESSES: Submit comments concerning the proposed amendment to 29 CFR 
part 37 to Annabelle T. Lockhart, Director, Civil Rights Center (CRC). 
Electronic mail is the preferred method for submittal of comments 
regarding 29 CFR part 37. Comments by electronic mail must be clearly 
identified as pertaining to the proposed amendment to 29 CFR part 37, 
and sent to [email protected]. Brief comments (maximum of five 
pages), clearly identified as pertaining to the proposed amendment to 
29 CFR part 37, may also be submitted by facsimile machine (FAX) to 
(202) 693-6505.
    Where necessary, hard copies of comments, clearly identified as 
pertaining to the proposed amendment to 29 CFR part 37, may also be 
delivered to Director Lockhart at the U.S. Department of Labor, 200 
Constitution Avenue, NW., Room N-4123, Washington, DC 20210. Because of 
delays in mail delivery, CRC suggests that commenters planning to 
submit comments via U.S. mail place those comments in the mail well 
before the deadline by which comments must be received.
    Receipt of submissions regarding the proposed amendments to 29 CFR 
part 37, whether by mail, e-mail, or FAX transmittal, will not be 
acknowledged; however, the sender may request confirmation that a 
submission has been received by telephoning the Civil Rights Center at 
the numbers listed below.
    Comments received will be available for public inspection during 
normal business hours at the above address. Persons who need assistance 
to review the comments will be provided with appropriate aids such as 
readers or print magnifiers. Copies of this proposed rule will be made 
available, upon request, in large print and electronic file on computer 
disk. Provision of the rule in other formats will be considered upon 
request. To schedule an appointment to review the comments and/or to 
obtain the proposed rule in an alternate format, contact CRC at (202) 
693-6500 (VOICE) or (202) 693-6515/16 (TTY/TDD). Please note that these 
are not toll-free numbers. You may also contact CRC at the addresses 
listed above.
    Submit comments concerning the proposed amendments to 20 CFR part 
667 to Maria Flynn, Acting Administrator, Office of Policy Development, 
Evaluation and Research, Employment and Training Administration, 
Department of Labor, Room N-5637, 200 Constitution Ave., NW., 
Washington, DC 20210. If you would like to receive notification that we 
have received your comments, you should include a self-addressed 
stamped postcard. You may submit comments by facsimile machine (FAX) to 
(202) 693-2766. Please note that this is not a toll-free number.

FOR FURTHER INFORMATION CONTACT: Regarding the proposed amendments to 
29 CFR Part 37: Annabelle T. Lockhart, Director, Civil Rights Center 
(CRC), (202) 693-6500 (VOICE) or (202) 693-6515/16 (TTY/TDD). Please 
note that these are not toll-free numbers.
    Regarding the proposed amendments to 20 CFR part 667: Maria Flynn, 
Acting Administrator, Office of Policy Development, Evaluation and 
Research, Employment and Training Administration, (202) 693-3700 
(VOICE) or (202) 877-889-5627 (TTY/TDD). Please note that these are not 
toll-free numbers.

SUPPLEMENTARY INFORMATION: The Department of Labor is proposing to 
amend the interim final regulations, codified at 29 CFR part 37, that 
implement the equal opportunity and nondiscrimination provisions of the 
Workforce Investment Act of 1998 (WIA). Today's proposal would revise a 
provision in the interim final regulations that prohibits the use of 
all types of WIA Title I financial assistance for the employment or 
training of participants in religious activities. Further, the 
Department of Labor is proposing to amend the regulations, codified in 
20 CFR part 667, that implement the general provisions of WIA, to 
conform those regulations to the proposed amendments to 29 CFR part 37.
    The preamble to this proposed rule is organized as follows:

I. Background--provides a brief description of the statutory and 
regulatory background of this proposed rule.
II. Overview of the Proposed Amendments--describes the amendments 
that would be accomplished by this proposed rule and explains the 
reasons for the amendments.
III. Regulatory Procedure--sets forth the applicable regulatory 
requirements.

I. Background

    The Workforce Investment Act of 1998 (WIA) superseded the Job 
Training Partnership Act (JTPA) as the Department of Labor's (DOL's) 
primary mechanism for providing financial assistance for a 
comprehensive system of employment and training services for adults and 
dislocated workers, and comprehensive youth activities for eligible 
youth. In WIA, Congress authorized financial assistance for that system 
through fiscal year 2003. The Administration is currently working to 
reauthorize WIA.
    WIA has several goals: (1) Enhanced employment, retention and 
earnings of individuals; (2) increased occupational skills attainment; 
and (3) improved national economic growth through better productivity 
and competitiveness. To achieve these goals, WIA provides workforce 
investment services and activities through a statewide and local 
network of One-Stop Career Center partners and operators. The One-Stop 
Career Centers support the employment needs of job seekers and meet the 
changing human resource requirements of American business by assisting 
with the recruitment, training and retention of skilled workers.
    Section 188 of WIA prohibits discrimination in the One-Stop Career 
Center system on the bases of race, color, national origin, sex, age,

[[Page 56387]]

disability, religion, and political affiliation or belief. 
Additionally, Section 188 prohibits discrimination against 
beneficiaries on the basis of participation in a program or activity 
that is financially assisted under Title I of WIA, and against certain 
non-citizen beneficiaries who are lawfully admitted to and authorized 
to work in the United States, on the basis of citizenship.
    DOL published an Interim Final Rule (IFR) to implement WIA Section 
188 on November 12, 1999, entitled ``Implementation of the 
Nondiscrimination and Equal Opportunity Provisions of the Workforce 
Investment Act of 1998,'' 64 FR 61692, codified at 29 CFR part 37. That 
IFR, which generally carried over the nondiscrimination- and equal 
opportunity-related policies and procedures in place under JTPA, 
remains in effect. Because Congress is scheduled to reauthorize WIA, 
DOL has elected to wait until that reauthorization is completed before 
publishing a final rule to implement the nondiscrimination and equal 
opportunity provisions of WIA.
    However, it has come to DOL's attention that some of the regulatory 
restrictions that were in place under JTPA are no longer required under 
WIA. For this reason, and to permit recipients of DOL financial 
assistance more choice and greater freedom while obtaining essential 
employment and training skills, the Department seeks to amend the WIA 
nondiscrimination IFR. The specific restrictions that are the subject 
of this NPRM are no longer necessary because the way in which financial 
assistance for training activities was provided under JTPA was 
different, in some instances, from the way in which such assistance is 
provided under WIA. The WIA nondiscrimination IFR bars the use of all 
types of WIA Title I financial assistance to employ or train 
participants in religious activities. This broad prohibition is 
inconsistent with current law, which permits the use of such financial 
assistance to provide religious training in cases in which participants 
are given a genuine and independent private choice among training 
providers, and freely elect to receive training in religious 
activities, provided the training offered otherwise satisfies the 
requirements of the program. As a result, the Department believes that 
29 CFR part 37 should be amended.
    In addition, the regulations promulgated by the Employment and 
Training Administration (ETA) and codified at 20 CFR part 667, which 
implement the general provisions of WIA, refer to the provision in 29 
CFR part 37 that restricts the use of WIA financial assistance for 
training in religious activities. Accordingly, ETA's regulations should 
be revised as well, to conform to the amended language of part 37.
    The current language of the regulatory provisions mentioned above 
may preclude religious organizations that are eligible training 
providers from receiving indirect Federal financial assistance in 
exchange for providing religious training, even in those situations in 
which participants exercise true private choice in selecting the 
training providers. The current regulatory language may also preclude 
participants from using WIA financial assistance for religious training 
in a manner consistent with Federal law. Therefore, the Department is 
proposing to amend the provisions at issue. Cf. Executive Order 13279, 
67 FR 77139, 77141 (December 16, 2002) (``Equal Protection of the Laws 
for Faith-Based and Community Organizations'').
    The NPRM would not change the underlying requirements for WIA 
financially assisted training. For example, participants must qualify 
as eligible for training, and training services must demonstrate 
certain linkages to occupations in demand. See WIA sec. 134(d)(4).
    The Secretary of Labor has rulemaking authority for the parts of 
the Code of Federal Regulations that would be amended by this proposed 
rule. The remaining sections of this preamble will explain the 
reasoning underlying the proposed amendments.
    The Department seeks comments on all issues concerning the proposed 
amendments to 29 CFR part 37 and the concurrent proposed revisions to 
20 CFR 667. The Department is interested in comments from current and 
potential recipients of WIA title I financial assistance as to the 
effect of participating in the program as permitted in the revised 
paragraph 37.6(f)(2) on their programs and operations in light of the 
existing rules and regulations imposed on recipients in 29 CFR Part 37 
including paragraph 37.6(c).

II. Overview of the Proposed Amendments

29 CFR Part 37

Proposed Paragraph 37.6(f)(1)

    The existing language of paragraph 37.6(f)(1) bars recipients from 
permitting participants ``to be employed or trained in sectarian 
activities.'' The provision was not based on any specific statutory 
authority conferred by WIA or JTPA; rather, as discussed in more detail 
below, it was a regulatory provision promulgated under JTPA because of 
the manner in which financial assistance was provided under that 
program. Because some of the methods used to provide financial 
assistance under WIA are different from those used under JTPA, the 
proposal would revise paragraph 37.6(f)(1) to allow for more 
flexibility based on those differences.
    Under JTPA, training institutions received financial assistance, 
channeled to training providers through State or local governments or 
private industry councils. The providers that participated under JTPA 
were selected pursuant to the job training plan established by each 
service delivery area. Pub. L. 97-300, Sec. Sec.  104(b)(5), 107(a), 
(d), 96 Stat. 1322, 1331, 1355-56 (1982). Nothing in the language of 
JTPA indicates that beneficiaries or participants were provided any 
opportunity to choose which training providers would receive financial 
assistance, and the Department did not administer JTPA in a way that 
allowed participants to exercise true private choice in selecting 
training providers. See Pub. L. No. 97-300, passim. Therefore, 
consistent with constitutional requirements that in certain 
circumstances restrict direct Federal financial assistance for 
inherently religious activities in the absence of true private choice, 
see,e.g., Bowen v. Kendrick, 487 U.S. 589, 611-12 (1988); Mitchell v. 
Helms, 530 U.S. 793, 815-16 (2002) (plurality opinion); Zelman v. 
Simmons-Harris, 536 U.S. 639, 649-55 (2002), the prohibition on the use 
of JTPA financial assistance for ``employment or training in sectarian 
activities'' was codified in the JTPA regulations promulgated by ETA, 
in a specific provision that stated that ``the employment or training 
of participants in sectarian activities is prohibited.'' 59 FR 45760, 
45822, Sec.  627.210(b) (September 2, 1994) (final rule).
    Under WIA, there are grant programs for which the financial 
assistance is provided directly to certain programs or activities, as 
under JTPA. However, much of the financial assistance available under 
WIA for training of individual beneficiaries is provided as a result of 
beneficiaries' genuine and independent private choice. The 
constitutional restrictions on the use of Federal financial assistance 
to support training in religious activities do not apply where the 
assistance is provided to religious organizations as a result of such 
genuine and independent private choices, provided the training 
otherwise satisfies the requirements of the program. See Zelman v. 
Simmons-Harris, 536 U.S. at 652; see also Witters

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v. Washington Department of Services for the Blind, 474 U.S. 481, 488 
(1986).
    For example, under Section 122 of WIA, a training provider that 
meets certain statutory criteria may apply to be identified as an 
eligible provider of training services. 29 U.S.C. 2842(a). Nothing in 
the statutory criteria excludes religious organizations from being so 
identified. Id. In addition, under WIA Section 134(d)(4), training 
services for participants or beneficiaries are primarily paid for 
through individual training accounts (ITAs). 29 U.S.C. 2864(d)(4)(G). 
For these services, (1) participants select their preferred training 
provider from a State's list of eligible providers and receive 
training; and (2) the provider receives payment from the participants' 
ITAs through electronic transfers of funds, vouchers, or other 
appropriate methods. Id.; 29 U.S.C. 2864(d)(4)(F), ``Consumer Choice 
Requirements''; 20 CFR 663.410.
    The preamble to the WIA nondiscrimination regulations indicates 
that 29 CFR 37.6(f) ``is directly based on, and implements, Section 
188(a)(3) of WIA.'' 64 FR at 61698. This statement is true with regard 
to existing paragraphs 37.6(f)(2) and (f)(3). Compare 29 U.S.C. 
2938(a)(3) with 29 CFR 37.6(f)(2) and (f)(3). Paragraph 37.6(f)(1), 
however, originated in the IFR promulgated by ETA to implement the 
general provisions of WIA, and was merely a carry-over from the JTPA 
regulations, with no basis in the WIA statute. When the WIA 
nondiscrimination IFR was promulgated seven months after ETA's IFR, 
paragraph 37.6(f)(1) was inserted in the nondiscrimination regulations. 
Compare 64 FR 18662, 18729, 18730, Sec. Sec.  667.266(a), 667.275(b) 
(April 15, 1999), with 29 CFR 37.6(f)(1). None of the language of the 
WIA statute, in Section 188(a)(3) or elsewhere addresses the employment 
or training of beneficiaries in religious activities.
    The proposed rule would amend paragraph 37.6(f)(1) to allow 
religious organizations to receive government financial assistance that 
is provided indirectly through the genuine and independent private 
choices of beneficiaries. The proposed new language would allow 
participants to use their ITAs, or similar training accounts under 
programs established by States or Local Workforce Investment Areas 
(LWIAs), for religious training, as long as the training account 
programs afford participants genuine and independent choice between 
religious and non-religious training options, and the religious 
organizations receiving assistance otherwise satisfy the requirements 
of the program.
    The proposed revision to paragraph 37.6(f)(1) would provide that 
financial assistance provided directly to a religious organization may 
not be expended for religious employment or training. Further, the 
revised paragraph would provide that, for purposes of the paragraph, 
the term ``direct'' would mean financial assistance that is provided at 
the direction of a governmental entity, or an intermediate organization 
with the same duties as a governmental entity under this program, as 
opposed to financial assistance that an organization receives as a 
result of the genuine and independent choice of a beneficiary. See 
Zelman v. Simmons-Harris, 536 U.S. 639.

Proposed Paragraph 37.6(f)(2)

    [Current paragraph 37.6(f)(2) would be redesignated paragraph 
37.6(f)(3).]
    Consistent with the discussion above, the proposal would add a new 
paragraph 37.6(f)(2) to permit WIA Title I financial assistance to be 
used to train participants in religious activities, as long as the 
State or LWIA has established a mechanism for providing such assistance 
that gives participants a genuine and independent choice among training 
providers (including religious and non-religious providers); that 
mechanism permits participants to direct the financial assistance to 
the provider of their choice; and the training provider that receives 
the assistance otherwise satisfies the requirements of the program.
    The revision would also be consistent with, and would assist in 
implementing, the principles underlying Executive Order 13279, ``Equal 
Protection of the Laws for Faith-Based and Community Organizations,'' 
issued by President Bush on December 12, 2002, and reprinted at 67 FR 
77141 (December 12, 2002). The purposes of Executive Order 13279 
include ensuring equal protection of the laws for faith-based and 
community organizations, and furthering the national effort to expand 
opportunities for, and strengthening the capacity of, faith-based and 
community organizations so that they may better meet the social needs 
in America's communities. In the Department's view, the proposed 
language for paragraph 37.6(f)(2) is necessary in order to comply with 
this requirement.

Proposed Paragraphs 37.6(f)(3) and (f)(4)

    [Current paragraph 37.6(f)(3) would be redesignated paragraph 
37.6(f)(4).]
    The existing language of paragraphs 37.6(f)(2) and (f)(3) 
implements Section 188(a)(3) of the Workforce Investment Act, 29 U.S.C. 
2938(a)(3), which precludes participants in a WIA financially assisted 
program from ``being employed to carry out the construction, operation, 
or maintenance of any part of any facility that is used or to be used 
for sectarian instruction or as a place for religious worship.'' This 
statutory prohibition covers all forms of financial assistance, 
including assistance that is provided as a result of the independent 
and private decisions of participants. WIA Section 188(a)(3) does 
permit participants to be employed ``with respect to the maintenance of 
a facility that is not primarily or inherently devoted to sectarian 
instruction or religious worship, in a case in which the organization 
operating the facility is part of a program or activity providing 
services to participants.''
    Existing paragraph 37.6(f)(2) addresses the employment activities 
at facilities devoted to religious instruction and worship that are 
proscribed by WIA Section 188(a)(3) of WIA. The employment activities 
that WIA Section 188(a)(3) permits at facilities operated by religious 
organizations are addressed in existing paragraph 37.6(f)(3). In the 
proposed regulations, existing paragraphs 37.6(f)(2) and (f)(3) would 
be redesignated as paragraphs 37.6(f)(3) and (f)(4), respectively. In 
addition, these paragraphs were revised in this proposed rule to make 
them easier to understand, and to adhere more closely to the language 
of WIA Section 188(a)(3). The proposed revisions are not intended to 
alter the meaning of these paragraphs.

20 CFR Part 667



Proposed Paragraphs 667.266(b)(1) and (2)

    The prohibition on employing and training participants in religious 
activities found in the current 29 CFR 37.6(f)(1) is also set forth in 
20 CFR 667.266(b)(1) of ETA's current regulations implementing WIA. The 
proposal would revise the provisions in 20 CFR 667.266(b)(1) to conform 
them to the proposed revisions to 29 CFR 37.6(f)(1). Thus, paragraph 
667.266(b)(1) in the proposed rule would provide that WIA Title I 
financial assistance provided directly from the State or LWIA to a 
religious organization may not be expended for religious employment or 
training. Also, proposed paragraph 667.266(b)(2) would provide that WIA 
Title I financial assistance may be used for religious employment and 
training where the State or LWIA has a mechanism for providing such 
assistance that gives participants a

[[Page 56389]]

genuine and independent choice among training providers, as set forth 
in proposed 29 CFR 37.6(f)(2). Further, the current language of 20 CFR 
667.266(b)(2) sets forth the prohibition on employing persons to carry 
out construction, operation, or maintenance of facilities used for 
religious instruction or religious worship that is found in 29 CFR 
37.6(f)(1). The only change proposed to existing 20 CFR 667.266(b)(2) 
is to revise the cross-references to 29 CFR 37.6(f)(1) and (f)(2) to 29 
CFR 37.6(f)(3) and (f)(4), respectively.

Proposed Paragraph 667.275(b)

    The existing language of 20 CFR 667.275(b) also refers to the 
provision in existing 29 CFR 37.6(f) that prohibits the employment and 
training of participants in religious activities. Accordingly, the 
proposed rule would revise 20 CFR 667.275(b) to conform to the proposed 
revisions to existing 29 CFR 37.6(f). Proposed paragraph 667.275(b) 
would provide that WIA financial assistance provided directly to a 
recipient may not be expended for the employment or training of 
participants in religious activities, but that WIA Title I financial 
assistance that is provided indirectly may be used to train 
participants in religious activities, as long as the State or LWIA has 
established a mechanism for providing such assistance that gives 
participants a genuine and independent choice among training providers 
(including religious and non-religious providers) and the other 
conditions outlined in 29 CFR 29.37.6(f)(2) are met. Further, proposed 
paragraph 667.275(b) would state that WIA financial assistance may not 
be used in employment or training activities that involve the 
construction or maintenance of any facility used for religious 
instruction or a place of worship, but that the employment of 
participants to maintain a facility that is not primarily or inherently 
devoted to religious instruction or worship is permitted if the 
organization operating the facility is part of an organization that 
provides services to participants.

III. Regulatory Procedures

Executive Order 12866

    The Office of Management and Budget (OMB) has reviewed this rule 
under Executive Order 12866, ``Regulatory Planning and Review.'' OMB 
has determined that this rule is a ``significant regulatory action'' as 
defined in section 3(f) of the Order. However, this rule is not an 
economically significant regulatory action under the Order, and 
therefore, no regulatory impact analysis has been prepared.

Regulatory Flexibility Act

    The proposed rule would not substantially change the existing 
obligation of recipients or entities operating Federally-assisted 
programs or activities to apply a policy of nondiscrimination and equal 
opportunity in employment or services. 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. Therefore, a regulatory flexibility analysis is not 
required.

Unfunded Mandates Reform Act

    For purposes of the Unfunded Mandates Reform Act of 1995, as well 
as Executive Order 12875, this proposed rule does not include any 
Federal mandate that may result in increased expenditures by any State, 
local, and tribal governments.

Paperwork Reduction Act

    The proposed rule contains no new information collection 
requirements. Therefore, it is not subject to the Paperwork Reduction 
Act.

Executive Order 13132

    This proposed rule has been reviewed in accordance with Executive 
Order 13132 regarding Federalism. The proposed rule will not have 
substantial direct effects on the States, on the relationship between 
the national government and the States, or on the distribution of power 
and responsibilities among the various levels of government. Therefore, 
the requirements of section 6 of Executive Order 13132 do not apply to 
this rule.
    20 CFR Part 667
    Employment, Grant programs--Labor, Reporting and recordkeeping 
requirements
    29 CFR Part 37
    Administrative practice and procedure, Discrimination, Civil 
rights, Equal education opportunity, Equal employment opportunity, 
Grant programs--Labor, Individuals with disabilities, Investigations, 
Reporting and recordkeeping requirements.
    For the reasons discussed in the preamble, part 667, subpart B, 
title 20 of the Code of Federal Regulations, and part 37, subpart A, 
title 29 of the Code of Federal Regulations, are amended to read as set 
forth below.

    Signed at Washington, DC this 22nd day of September, 2003.
Elaine L. Chao,
Secretary of Labor.

Title 20--Employees' Benefits

Chapter V--Employment and Training Administration, Department of Labor

PART 667--ADMINISTRATIVE PROVISIONS UNDER TITLE I OF THE WORKFORCE 
INVESTMENT ACT (WIA)

    1. The authority citation for part 667 is revised to read as 
follows:

    Authority: Section 506(c), Pub. L. 105-220, 112 Stat. 1246 (20 
U.S.C. 9276(c)).

    2. In Sec.  667.266, the section heading and paragraph (b) are 
revised to read as follows:


Sec.  667.266  What are the limitations related to religious 
activities?

* * * * *
    (b) Under these limitations:
    (1) WIA title I financial assistance provided directly from the 
State or LWIA to a religious organization may not be expended for 
religious employment or training. This limitation is more fully 
described at 29 CFR 37.6(f)(1). As set forth in 29 CFR 37.6(f)(2), 
financial assistance provided under title I of WIA may be used to train 
participants in religious activities where the State or LWIA has 
established a mechanism for providing such assistance that gives 
participants a genuine and independent choice among training providers 
(including religious and non-religious providers), that mechanism 
permits participants to direct the financial assistance to the provider 
of their choice, and the provider receiving the assistance otherwise 
satisfies the requirements of the program.
    (2) Under 29 CFR 37.6(f)(3), participants must not be employed 
under title I of WIA to carry out the construction, operation, or 
maintenance of any part of any facility that is used or to be used for 
religious instruction or as a place for religious worship. However, as 
discussed in 29 CFR 37.6(f)(4), WIA financial assistance may be used 
for the maintenance of a facility to the extent that it is not 
primarily or inherently devoted to religious instruction or religious 
worship and provided that the organization operating the facility is 
part of a program or activity providing services to WIA participants. 
(WIA sec. 188(a)(3).)
* * * * *
    3. In Sec.  667.275, the section heading and paragraph (b) are 
revised to read as follows:

[[Page 56390]]

Sec.  667.275  What are a recipient's obligations to ensure 
nondiscrimination and equal opportunity, as well as nonparticipation in 
religious activities?

* * * * *
    (b) Under 29 CFR 37.6(f), WIA financial assistance provided 
directly to a recipient may not be expended for religious employment or 
training, but financial assistance provided under title I of WIA may be 
used to train participants in religious activities, as long as the 
State or LWIA has established a mechanism for providing such assistance 
that gives participants a genuine and independent choice among training 
providers (including religious and non-religious providers), that 
mechanism permits participants to direct the financial assistance to 
the provider of their choice, and the provider receiving the assistance 
otherwise satisfies the requirements of the program. WIA financial 
assistance may not be used in employment or training activities that 
involve the construction, or maintenance of any facility used for 
religious instruction or as a place of worship, but the employment of 
participants to maintain a facility to the extent that it is not 
primarily or inherently devoted to religious instruction or worship is 
permitted, and provided that the organization operating the facility is 
part of a program or activity that provides services to participants.

Title 29--Labor

Subtitle A--Office of the Secretary

PART 37--IMPLEMENTATION OF THE NONDISCRIMINATION AND EQUAL 
OPPORTUNITY PROVISIONS OF THE WORKFORCE INVESTMENT ACT OF 1998 
(WIA)

    1. The authority citation for part 37 continues to read as follows:

    Authority: Sections 134(b), 136(d)(2)(F), 136(e), 172(a), 
183(c), 185(c)(2), 185(d)(1)(E), 186, 187 and 188 of the Workforce 
Investment Act of 1998, 29 U.S.C. 2801, et seq.; Title VI of the 
Civil Rights Act of 1964, as amended, 42 U.S.C. 2000d, et seq.; 
Section 504 of the Rehabilitation Act of 1973, as amended, 29 U.S.C. 
794; the Age Discrimination Act of 1975, as amended, 42 U.S.C. 6101; 
and Title IX of the Education Amendments of 1972, as amended, 20 
U.S.C. 1681.

    2. In Sec.  37.6, paragraph (f) is revised to read as follows:


Sec.  37.6  What specific discriminatory actions, based on prohibited 
grounds other than disability, are prohibited by this part?

* * * * *
    (f)(1) No financial assistance provided directly from the State or 
LWIA to a religious organization may be expended for religious 
employment or training. For purposes of this paragraph, the term 
``direct'' means financial assistance that is provided at the direction 
of a governmental entity, or an intermediate organization with the same 
duties as a governmental entity under this program, as opposed to 
financial assistance that an organization receives as a result of the 
genuine and independent choice of the beneficiary.
    (2) A recipient may permit WIA title I financial assistance to be 
used to train participants in religious activities if:
    (i) The State or LWIA has established a mechanism for providing 
such financial assistance that gives participants a genuine and 
independent choice among training providers (including religious and 
non-religious providers);
    (ii) The mechanism established by the State or LWIA includes an 
Individual Training Account (ITA), voucher, coupon, certificate, or 
other similar procedure through which participants direct the WIA Title 
I financial assistance to the provider of their choice; and
    (iii) The selected provider otherwise satisfies the requirements of 
the program.
    (3) Except under the circumstances described in paragraph (f)(4) 
below, a recipient must not permit participants to engage in employment 
or training activities that involve the construction, operation, or 
maintenance of any facility, or any part of a facility, that is used, 
or will be used, for religious instruction or as a place of religious 
worship.
    (4) A recipient may permit participants to engage in employment or 
training activities that involve the maintenance of a facility that is 
used, or will be used, for religious instruction or religious worship,
    (i) To the extent that the facility is not primarily or inherently 
devoted to religious instruction or religious worship, and
    (ii) Provided that the organization operating the facility is part 
of a program or activity providing services to participants.

[FR Doc. 03-24296 Filed 9-29-03; 8:45 am]
BILLING CODE 4510-23-P; 4510-30-P