[Federal Register Volume 80, Number 151 (Thursday, August 6, 2015)]
[Proposed Rules]
[Pages 47238-47241]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2015-18261]



[[Page 47237]]

Vol. 80

Thursday,

No. 151

August 6, 2015

Part V





Agency for International Development





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22 CFR Part 205





Amendment To Participation by Religious Organizations in USAID Programs 
To Implement Executive Order 13559; Proposed Rule

  Federal Register / Vol. 80 , No. 151 / Thursday, August 6, 2015 / 
Proposed Rules  

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AGENCY FOR INTERNATIONAL DEVELOPMENT

22 CFR Part 205

RIN 0412-AA75


Amendment To Participation by Religious Organizations in USAID 
Programs To Implement Executive Order 13559

AGENCY: U.S. Agency for International Development.

ACTION: Proposed rule.

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SUMMARY: The U.S. Agency for International Development (USAID) is 
proposing to amend its regulations governing the participation by 
religious organizations in USAID's programs to reflect guidance from 
the Interagency Working Group on Faith-Based and Other Neighborhood 
Partnerships on implementing Executive Order 13559.

DATES: Submit comments on or before September 8, 2015.

ADDRESSES: Address all comments concerning this proposed rule to C. 
Eduardo Vargas, Center for Faith-Based & Community Initiatives (A/AID/
CFBCI), U.S. Agency for International Development, Room 6.07-100 RRB, 
1300 Pennsylvania Avenue NW., Washington, DC 20523. Submit comments, 
identified by title of the action and Regulatory Information Number 
(RIN) by any of the following methods:
    Federal eRulemaking Portal: http://www.regulations.gov. Follow the 
instructions for submitting comments.
    Email: Submit electronic comments to [email protected]. See 
SUPPLEMENTARY INFORMATION for file formats and other information about 
electronic filing.
    Mail: USAID, Center for Faith-Based & Community Initiatives (A/AID/
CFBCI), Room 6.07-100, 1300 Pennsylvania Avenue NW., Washington, DC 
20523.
    A copy of each communication submitted will be available for 
inspection and copying between 8:30 a.m. and 5:30 p.m. at the above 
address.

FOR FURTHER INFORMATION CONTACT: Mark Brinkmoeller, Director, Center 
for Faith-Based and Community Initiatives, USAID, Room 6.07-023, 1300 
Pennsylvania Avenue NW., Washington, DC 20523; telephone: (202) 712-
4080 (this is not a toll-free number).

SUPPLEMENTARY INFORMATION:

I. Background

    On December 12, 2002, President Bush signed Executive Order 13279, 
Equal Protection of the Laws for Faith-Based and Community 
Organizations, 67 FR 77141. Executive Order 13279 set forth the 
principles and policymaking criteria to guide Federal agencies in 
formulating and developing policies with implications for faith-based 
organizations and other community organizations, to ensure equal 
protection of the laws for faith-based and other community 
organizations, and to expand opportunities for, and strengthen the 
capacity of, faith-based and other community organizations to meet 
social needs in America's communities. In addition, Executive Order 
13279 asked specified agency heads to review and evaluate existing 
policies relating to Federal financial assistance for social services 
programs and, where appropriate, to implement new policies that were 
consistent with and necessary to further the fundamental principles and 
policymaking criteria that have implications for faith-based and 
community organizations.
    On October 20, 2004, USAID published its final rule (the ``Original 
Rule'') on participation by religious organizations in USAID programs 
(69 FR 61,716, codified at 22 CFR parts 202, 205, 211, and 226). The 
Original Rule implemented Executive Branch policy that, within the 
framework of constitutional guidelines, religious organizations should 
be able to compete on an equal footing with other organizations for 
USAID funding. The Original Rule revised USAID regulations pertaining 
to grants, cooperative agreements and contracts awarded for the purpose 
of administering grant programs to ensure their compliance with this 
policy and to clarify that religious organizations are eligible to 
participate in programs on the same basis as any other organization, 
with respect to programs for which such other organizations are 
eligible.
    Shortly after taking office, President Obama signed Executive Order 
13498, Amendments to Executive Order 13199 and Establishment of the 
President's Advisory Council for Faith-Based and Neighborhood 
Partnerships, 74 FR 6533 (Feb. 9, 2009). Executive Order 13498 changed 
the name of the White House Office of Faith-Based and Community 
Initiatives to the White House Office of Faith-Based and Neighborhood 
Partnerships and established the President's Advisory Council for 
Faith-Based and Neighborhood Partnerships (Advisory Council). The 
President created the Advisory Council to bring together experts to, 
among other things, make recommendations to the President for changes 
in policies, programs, and practices that affect the delivery of 
services by faith-based and other neighborhood organizations.
    The Advisory Council issued its recommendations in a report 
entitled A New Era of Partnerships: Report of Recommendations to the 
President in March 2010 (available at http://www.whitehouse.gov/sites/default/files/microsites/ofbnp-council-final-report.pdf). The Advisory 
Council Report included recommendations to amend Executive Order 13279 
in order to clarify the legal foundation of partnerships and offered a 
new set of fundamental principles to guide agency decision-making in 
administering Federal financial assistance and support to faith-based 
and neighborhood organizations.
    President Obama signed Executive Order 13559, Fundamental 
Principles and Policymaking Criteria for Partnerships with Faith-Based 
and Other Neighborhood Organizations, on November 17, 2010. 75 FR 71319 
(available at http://www.gpo.gov/fdsys/pkg/FR-2010-11-22/pdf/2010-29579.pdf). Executive Order 13559 incorporated the Advisory Council's 
recommendations by making certain amendments to Executive Order 13279. 
In addition, Executive Order 13559 created the Interagency Working 
Group on Faith-Based and Other Neighborhood Partnerships (Working 
Group) to review and evaluate existing regulations, guidance documents, 
and policies.
    The Executive Order also stated that, following receipt of the 
Working Group's report, OMB, in coordination with the Department of 
Justice, must issue guidance to agencies on the implementation of the 
order. In August 2013, OMB issued such guidance. In this guidance, OMB 
instructed specified agency heads to adopt regulations and guidance 
that will fulfill the requirements of the Executive Order and to amend 
regulations and guidance to ensure that they are consistent with 
Executive Order 13559. The guidance incorporated the Working Group's 
Report, which noted that it focused largely on domestic considerations. 
The Report went on to note that for programs operating in foreign 
countries, additional considerations may be implicated, and that 
agencies, such as USAID, should consult with the Department of Justice 
on implementation of the Executive Order. Thus, the changes proposed in 
this rule result from those consultations.
    On March 25, 2011, USAID issued a Notice of Public Rulemaking 
(NPRM) proposing amendments to section (d) of its Original Rule. That 
process is ongoing. USAID is not proposing any amendments to section 
(d) under this proposed rulemaking.

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II. Overview of Proposed Rule

    USAID proposes to amend 22 CFR part 205, Participation by Religious 
Organizations in USAID Programs, to make it consistent with Executive 
Order 13559.

Prohibited Uses of Direct Federal Financial Assistance

    Part 205 and Executive Order 13279 prohibit nongovernmental 
organizations from using direct Federal financial assistance (e.g., 
government grants, contracts, sub-grants, and subcontracts) for 
``inherently religious activities, such as worship, religious 
instruction, and proselytization.'' The term ``inherently religious'' 
has proven confusing. In 2006, for example, the Government 
Accountability Office (GAO) found that, while all 26 of the religious 
social service providers it interviewed said they understood the 
prohibition on using direct Federal financial assistance for 
``inherently religious activities,'' four of the providers described 
acting in ways that appeared to violate that rule. GAO, Faith-Based and 
Community Initiative: Improvements in Monitoring Grantees and Measuring 
Performance Could Enhance Accountability, GAO-06-616, at 34-35 (June 
2006) (available at http://www.gao.gov/new.items/d06616.pdf).
    Further, while the Supreme Court has sometimes used the term 
``inherently religious,'' it has not used it to indicate the boundary 
of what the Government may subsidize with direct Federal financial 
assistance. If the term is interpreted narrowly, it could permit 
actions that the Constitution prohibits. On the other hand, one could 
also argue that the term ``inherently religious'' is too broad rather 
than too narrow. For example, some might consider their provision of a 
hot meal to a needy person to be an ``inherently religious'' act when 
it is undertaken from a sense of religious motivation or obligation, 
even though it has no overt religious content.
    The Court has determined that the Government cannot subsidize ``a 
specifically religious activity in an otherwise substantially secular 
setting.'' Hunt v. McNair, 413 U.S. 734, 743 (1973). It has also said a 
direct aid program impermissibly advances religion when the aid results 
in governmental indoctrination of religion. See Mitchell v. Helms, 530 
U.S. 793, 808 (2000) (Thomas, J., joined by Rehnquist, C.J., Scalia, 
and Kennedy, JJ., plurality); id. at 845 (O'Connor, J., joined by 
Breyer, J., concurring in the judgment); Agostini v. Felton, 521 U.S. 
203, 223 (1997). This terminology is fairly interpreted to prohibit the 
Government from directly subsidizing any ``explicitly religious 
activity,'' including activities that involve overt religious content. 
Thus, direct Federal financial assistance should not be used to pay for 
activities such as religious instruction, devotional exercises, 
worship, proselytizing or evangelism; production or dissemination of 
devotional guides or other religious materials; or counseling in which 
counselors introduce religious content. Similarly, direct Federal 
financial assistance may not be used to pay for equipment or supplies 
to the extent they are allocated to such activities.
    Activities that are secular in content, such as serving meals to 
the needy or using a nonreligious text to teach someone to read, are 
not considered ``explicitly religious activities'' merely because the 
provider is religiously motivated to provide those services. The study 
or acknowledgement of religion as a historical or cultural reality also 
would not be considered an explicitly religious activity.
    Likewise, it is important to emphasize that the restrictions on 
explicit religious content apply to content generated by the 
administrators of the program receiving direct Federal financial 
assistance, not to spontaneous comments made by individual 
beneficiaries about their personal lives in the context of these 
programs. For example, if a person administering a federally funded job 
skills program asks beneficiaries to describe how they gain the 
motivation necessary for their job searches and some beneficiaries 
refer to their faith or membership in a faith community, these kinds of 
comments do not violate the restrictions and should not be censored. In 
this context, it is clear that the administrator of the government 
program did not orchestrate or encourage such comments.
    USAID, therefore, proposes to amend its regulations to replace the 
term ``inherently religious activities'' with the term ``explicitly 
religious activities'' and define the latter term as ``including 
activities that involve overt religious content such as worship, 
religious instruction, or proselytization.'' These changes in language 
will provide greater clarity and more closely match constitutional 
standards as they have been developed in case law.
    These restrictions would not diminish existing regulatory 
protections for the religious identity of faith-based providers. The 
proposed rule would not affect, for example, organizations' ability to 
use religious terms in their organizational names, select board members 
on a religious basis, include religious references in mission 
statements and other organizational documents, and post religious art, 
messages, scriptures and symbols in buildings where Federal financial 
assistance is delivered.

Intermediaries

    USAID proposes language that will clarify that organizations who 
receive USAID financial assistance through subawards must comply with 
the requirements relating to protections for beneficiaries and the 
restrictions on prohibited uses of federal financial assistance. The 
language of USAID's rule has always couched the requirements in the 
rule as applying to organizations ``that receive direct financial 
assistance from USAID,'' which by its terms includes any organizations 
that receive such assistance, whether they did so through a prime award 
or a sub-award. However, to avoid any doubt, USAID proposes to add 
language explicitly stating that the requirements of the rule apply to 
organizations ``that receive direct financial assistance from USAID 
(including through a prime award or sub-award).''

Protections for Beneficiaries

    Executive Order 13559 makes it clear that all organizations that 
receive Federal financial assistance for the purpose of delivering 
social welfare services are prohibited from discriminating against 
beneficiaries or potential beneficiaries of those programs on the basis 
of religion, a religious belief, refusal to hold a religious belief, or 
a refusal to attend or participate in a religious practice. It also 
states that organizations offering explicitly religious activities 
(including activities that involve overt religious content such as 
worship, religious instruction or proselytization) must not use direct 
Federal financial assistance to subsidize or support those activities, 
and that any explicitly religious activities must be offered outside of 
programs that are supported with direct Federal financial assistance 
(including through prime awards or sub-awards). In other words, to the 
extent that an organization provides explicitly religious activities, 
those activities must be offered separately in time or location from 
programs or services supported with direct Federal financial 
assistance. And, as noted above, participation in those religious 
activities must be completely voluntary for beneficiaries of programs 
supported by Federal financial assistance. USAID proposes to add 
language to the sections of its rule covering these concepts to conform

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more directly to the Executive Order language.

Political or Religious Affiliation

    The proposed rule provides that decisions about awards of Federal 
financial assistance must be free from political interference or even 
the appearance of such interference. USAID must instruct participants 
in the awarding process to refrain from taking religious affiliations 
or non-religious affiliations into account in this process; i.e., an 
organization should not receive favorable or unfavorable marks merely 
because it is affiliated or unaffiliated with a religious body, or 
related or unrelated to a specific religion. When selecting peer 
reviewers, the awarding entity should never ask about religious 
affiliation or take such matters into account. But it should encourage 
religious, political and professional diversity among peer reviewers by 
advertising for these positions in a wide variety of venues.

III. Findings and Certifications

Regulatory Planning and Review

    This is not a significant regulatory action and, therefore, is not 
subject to review under section 6(b) of Executive Order 12866, 
Regulatory Planning and Review. This rule is not a major rule under 5 
U.S.C. 804. The main effect of the rule is to provide clarifying 
language around the types of activities that may be funded with Federal 
financial assistance, thereby preventing confusion in stakeholders and 
lessening the need for stakeholders to consult USAID for clarification 
on appropriate activities.

Regulatory Flexibility Act

    Pursuant to requirements set forth in the Regulatory Flexibility 
Act (RFA) (5 U.S.C. 601 et seq.), USAID has considered the economic 
impact of the proposed rule. USAID certifies that the rule will not 
have a significant economic impact on a substantial number of small 
entities.

Paperwork Burden

    This proposed rule does not impose any new recordkeeping 
requirements nor does it change or modify an existing information 
collection activity. Thus, the Paperwork Reduction Act does not apply 
to this proposed rule.

List of Subjects of 22 CFR Part 205

    Foreign aid, Grant programs, Nonprofit organizations.

    For the reasons stated in the preamble, USAID proposes to amend 
chapter II of title 22 of the Code of Federal Regulations as follows:

PART 205--PARTICIPATION BY RELIGIOUS ORGANIZATIONS IN USAID 
PROGRAMS

0
1. The authority citation for part 205 continues to read as follows:

    Authority: 22 U.S.C. 2381(a).

0
2. Amend Sec.  205.1 by revising paragraphs (b), (c), (e), and (f), and 
adding paragraph (j), to read as follows:


Sec.  205.1  Grants and cooperative agreements.

* * * * *
    (b) Organizations that receive direct financial assistance from 
USAID under any USAID program (including through a prime award or sub-
award) may not engage in explicitly religious activities (including 
activities that involve overt religious content such as worship, 
religious instruction, or proselytization), as part of the programs or 
services directly funded with direct financial assistance from USAID. 
If an organization conducts such activities, the activities must be 
offered separately, in time or location, from the programs or services 
funded with direct financial assistance from USAID, and participation 
must be voluntary for beneficiaries of the programs or services funded 
with such assistance. These restrictions on explicitly religious 
activities do not apply to programs where USAID funds are provided to 
chaplains to work with inmates in prisons, detention facilities, or 
community correction centers, or where USAID funds are provided to 
religious or other organizations for programs in prisons, detention 
facilities, or community correction centers, in which such 
organizations assist chaplains in carrying out their duties.
    (c) A religious organization that applies for, or participates in, 
USAID-funded programs or services (including through a prime award or 
sub-award) may retain its independence and may continue to carry out 
its mission, including the definition, development, practice, and 
expression of its religious beliefs, provided that it does not use 
direct financial assistance from USAID (including through a prime award 
or sub-award) to support or engage in any explicitly religious 
activities (including activities that involve overt religious content 
such as worship, religious instruction, or proselytization), or in any 
other manner prohibited by law. Among other things, a religious 
organization that receives financial assistance from USAID may use 
space in its facilities, without removing religious art, icons, 
scriptures, or other religious symbols. In addition, a religious 
organization that receives financial assistance from USAID retains its 
authority over its internal governance, and it may retain religious 
terms in its organization's name, select its board members on a 
religious basis, and include religious references in its organization's 
mission statements and other governing documents.
* * * * *
    (e) An organization that participates in programs funded by 
financial assistance from USAID (including through a prime award or 
sub-award) shall not, in providing services, discriminate against a 
program beneficiary or potential program beneficiary on the basis of 
religion or religious belief, refusal to hold a religious belief, or a 
refusal to attend or participate in a religious practice.
    (f) No grant document, contract, agreement, covenant, memorandum of 
understanding, policy, or regulation that is used by USAID shall 
require only religious organizations to provide assurances that they 
will not use monies or property for explicitly religious activities 
(including activities that involve overt religious content such as 
worship, religious instruction, or proselytization). Any such 
restrictions shall apply equally to religious and secular 
organizations. All organizations that participate in USAID programs 
(including through a prime award or sub-award), including religious 
ones, must carry out eligible activities in accordance with all program 
requirements and other applicable requirements governing the conduct of 
USAID-funded activities, including those prohibiting the use of direct 
financial assistance from USAID to engage in explicitly religious 
activities. No grant document, agreement, covenant, memorandum of 
understanding, policy, or regulation that is used by USAID shall 
disqualify religious organizations from participating in USAID's 
programs because such organizations are motivated or influenced by 
religious faith to provide social services, or because of their 
religious character or affiliation.
* * * * *

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    (j) Decisions about awards of USAID financial assistance must be 
free from political interference or even the appearance of such 
interference and must be made on the basis of merit, not on the basis 
of religion or religious belief.

    Dated: April 16, 2015.
Mark Brinkmoeller,
Director, Center for Faith-Based and Community Initiatives.

    Editorial note: This document was received for publication by 
the Office of the Federal Register on July 21, 2015.

[FR Doc. 2015-18261 Filed 8-5-15; 8:45 am]
BILLING CODE 6116-01-P