[Federal Register Volume 85, Number 243 (Thursday, December 17, 2020)]
[Rules and Regulations]
[Pages 82037-82148]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2020-27084]
[[Page 82035]]
Vol. 85
Thursday,
No. 243
December 17, 2020
Part II
Department of Education
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2 CFR Part 3473
34 CFR Parts 75 and 76
Department of Homeland Security
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6 CFR Part 19
Department of Agriculture
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7 CFR Part 16
Agency for International Development
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6 CFR Part 19
Department of Housing and Urban Development
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24 CFR Parts 5, 92, et al.
Department of Justice
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28 CFR Part 38
[[Page 82036]]
Department of Labor
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29 CFR Part 2
Department of Veterans Affairs
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38 CFR Parts 50, 61, et al.
Department of Health and Human Services
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Office of the Secretary
45 CFR Part 87
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Administration for Children and Families
45 CFR Part 1050
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Equal Participation of Faith-Based Organizations in the Federal
Agencies' Programs and Activities; Final Rule
Federal Register / Vol. 85, No. 243 / Thursday, December 17, 2020 /
Rules and Regulations
[[Page 82037]]
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DEPARTMENT OF EDUCATION
2 CFR Part 3474
34 CFR Parts 75 and 76
[ED-2019-OPE-0080]
RIN 1840-AD 45
DEPARTMENT OF HOMELAND SECURITY
6 CFR Part 19
[DHS-2019-0049]
RIN 1601-AA93
DEPARTMENT OF AGRICULTURE
7 CFR Part 16
[USDA-2020-0009]
RIN 0510-AA008
AGENCY FOR INTERNATIONAL DEVELOPMENT
22 CFR Part 205
[AID-2020-0001]
RIN 0412-AA99
DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT
24 CFR Parts 5, 92, and 578
[HUD-2020-0017]
RIN 2501-AD91
DEPARTMENT OF JUSTICE
28 CFR Part 38
[DOJ-OAG-2020-0001; A.G. Order No. 4925-2020]
RIN 1105-AB58
DEPARTMENT OF LABOR
29 CFR Part 2
[DOL-2019-0006]
RIN 1291-AA41
DEPARTMENT OF VETERANS AFFAIRS
38 CFR Parts 50, 61, and 62
[VA-2020-VACO-0003]
RIN 2900-AQ75
DEPARTMENT OF HEALTH AND HUMAN SERVICES
Office of the Secretary
45 CFR Part 87
Administration for Children and Families
45 CFR Part 1050
[HHS-OS-2020-0001]
RIN 0991-AC13
Equal Participation of Faith-Based Organizations in the Federal
Agencies' Programs and Activities
AGENCY: Department of Education, Department of Homeland Security,
Department of Agriculture, Agency for International Development,
Department of Housing and Urban Development, Department of Justice,
Department of Labor, Department of Veterans Affairs, Department of
Health and Human Services.
ACTION: Final rule.
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SUMMARY: This rule amends the regulations of the agencies listed above
(``the Agencies'') to implement Executive Order 13831 of May 3, 2018
(Establishment of a White House Faith and Opportunity Initiative). This
rule provides clarity about the rights and obligations of faith-based
organizations participating in the Agencies' Federal financial
assistance programs and activities. This rulemaking is intended to
ensure that the Agencies' Federal financial assistance programs and
activities are implemented in a manner consistent with the requirements
of Federal law, including the First Amendment to the Constitution and
the Religious Freedom Restoration Act.
DATES: This final rule becomes effective on January 19, 2021.
FOR FURTHER INFORMATION CONTACT: For information regarding each
Agency's implementation of these final regulations, the contact
information for that Agency follows. If you use a telecommunications
device for the deaf (``TDD'') or a text telephone (``TTY''), call the
Federal Relay Service (``FRS''), toll free, at 800-877-8339:
Department of Education: Lynn Mahaffie, Assistant General
Counsel, Division of Regulatory Services, Office of the General
Counsel, 202-453-7862, [email protected].
Department of Homeland Security: Peter Mina, Deputy
Officer for Programs and Compliance, Office for Civil Rights and Civil
Liberties, 202-401-1474 (phone), 202-401-0470 (TTY).
Department of Agriculture: Emily Tasman, Assistant General
Counsel, Office of the General Counsel, 202-720-3351,
[email protected].
Agency for International Development: Brian Klotz, Deputy
Director, Center for Faith & Opportunity Initiatives, 202-712-0217,
[email protected].
Department of Housing and Urban Development: Richard
Youngblood, Director, Center for Faith-Based and Neighborhood
Partnerships, 202-402-5958.
Department of Justice: Michael L. Alston, Director, Office
for Civil Rights, Office of Justice Programs, 202-514-2000,
[email protected].
Department of Labor: Mark Zelden, Director, Centers for
Faith & Opportunity Initiatives, 202-693-6017, [email protected].
Department of Veterans Affairs: Conrad Washington,
Director, Center for Faith and Opportunity Initiatives, Office of
Public and Intergovernmental Affairs, 202-461-7865.
Department of Health and Human Services: Shannon O. Royce,
Director, Center for Faith and Opportunity Initiatives, 202-260-6501.
SUPPLEMENTARY INFORMATION:
I. Background
Shortly after taking office in 2001, President George W. Bush
signed Executive Order 13199, 66 FR 8499 (Jan. 29, 2001) (Establishment
of White House Office of Faith-Based and Community Initiatives). That
Executive Order sought to ensure that ``private and charitable groups,
including religious ones, . . . have the fullest opportunity permitted
by law to compete on a level playing field'' in the delivery of social
services. To do so, it created an office within the White House, the
White House Office of Faith-Based and Community Initiatives, with
primary responsibility to ``establish policies, priorities, and
objectives for the Federal Government's comprehensive effort to enlist,
equip, enable, empower, and expand the work of faith-based and other
community organizations to the extent permitted by law.''
On December 12, 2002, President Bush signed Executive Order 13279,
67 FR 77141 (Dec. 12, 2002) (Equal Protection of the Laws for Faith-
Based and Community Organizations). Executive Order 13279 set forth the
principles and policymaking criteria to guide Federal agencies in
formulating and implementing policies with implications for faith-based
organizations and other community organizations, to ensure equal
protection of the laws for faith-based and 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 directed
specified agency heads to review and evaluate existing policies that
had implications for faith-based and community organizations relating
to their eligibility for Federal financial assistance for social
service programs and, where appropriate, to implement new policies that
were consistent with and necessary to further the fundamental
principles and policymaking criteria articulated in the Executive
Order.
In 2004, the Department of Veterans Affairs (``VA'') promulgated
regulations at 38 CFR part 61 consistent with Executive Order 13279. VA
Homeless
[[Page 82038]]
Providers Grant and Per Diem Program; Religious Organizations, 69 FR
31883 (June 8, 2004). The Department of Education similarly promulgated
regulations at 34 CFR parts 74, 75, 76, and 80. Participation in
Education Department Programs by Religious Organizations; Providing for
Equal Treatment of All Education Program Participants, 69 FR 31708
(June 4, 2004). In 2003 and 2004, the Department of Housing and Urban
Development (``HUD'') promulgated three final rules to implement
Executive Order 13279. See Providing for Equal Treatment of All Program
Participants, 69 FR 62164 (Oct. 22, 2004); Equal Participation of
Faith-Based Organizations, 69 FR 41712 (July 9, 2004); Participation in
HUD's Native American Programs by Religious Organizations;
Participation in HUD Programs by Faith-Based Organizations; Providing
for Equal Treatment of all HUD Program Participants, 68 FR 56396 (Sept.
30, 2003). In 2004, the Department of Justice (``DOJ''), Department of
Agriculture (``USDA''), Department of Labor (``DOL''), Department of
Health and Human Services (``HHS''), and Agency for International
Development (``USAID'') issued regulations through notice-and-comment
rulemaking implementing Executive Order 13279. See Participation in
Justice Department Programs by Religious Organizations; Providing for
Equal Treatment of All Justice Department Program Participants, 69 FR
2832 (Jan. 21, 2004); Equal Opportunity for Religious Organizations, 69
FR 41375 (July 9, 2004); Equal Treatment in Department of Labor
Programs for Faith-Based and Community Organizations; Protection of
Religious Liberty of Department of Labor Social Service Providers and
Beneficiaries, 69 FR 41882 (July 12, 2004); Participation in Department
of Health and Human Services Programs by Religious Organizations;
Providing for Equal Treatment of All Department of Health and Human
Services Program Participants, 69 FR 42586 (July 16, 2004);
Participation by Religious Organizations in USAID Programs, 69 FR 61716
(Oct. 20, 2004). DOL subsequently issued guidance detailing the process
for recipients of financial assistance to obtain exemptions from
religious nondiscrimination requirements under the Religious Freedom
Restoration Act (``RFRA''), 42 U.S.C. 2000bb through 2000bb-4.\1\ DHS
issued a Notice of Proposed Rulemaking (``NPRM'' or ``proposed rule'')
in 2008, see Nondiscrimination in Matters Pertaining to Faith-Based
Organizations, 73 FR 2187 (Jan. 14, 2008); however, DHS did not issue a
final rule related to the participation of faith-based organizations in
its programs prior to 2016.
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\1\ See DOL, Guidance Regarding Federal Grants and Executive
Order 13798, https://www.dol.gov/agencies/oasam/grants/religious-freedom-restoration-act.
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President Obama maintained President Bush's program but modified it
in certain respects. Shortly after taking office, President Obama
signed Executive Order 13498, 74 FR 6533 (Feb. 5, 2009) (Amendments to
Executive Order 13199 and Establishment of the President's Advisory
Council for Faith-Based and Neighborhood Partnerships). This Executive
Order 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 it created the President's Advisory
Council on Faith-Based and Neighborhood Partnerships, which
subsequently submitted recommendations regarding the work of the
Office.
On November 17, 2010, President Obama signed Executive Order 13559,
75 FR 71319 (Nov. 17, 2010) (Fundamental Principles and Policymaking
Criteria for Partnerships with Faith-Based and Other Neighborhood
Organizations). Executive Order 13559 made various changes to Executive
Order 13279, which included: Making minor and substantive textual
changes to the fundamental principles; adding a provision requiring
that any religious social service provider refer potential
beneficiaries to an alternative provider if the beneficiaries objected
to the first provider's religious character; adding a provision
requiring that the faith-based provider give notice of potential
referral to potential beneficiaries; and adding a provision that awards
must be free of political interference and not be based on religious
affiliation or lack thereof. An interagency working group was tasked
with developing model regulatory changes to implement Executive Order
13279, as amended by Executive Order 13559, including provisions that
clarified the prohibited uses of direct financial assistance, allowed
religious social service providers to maintain their religious
identities, and distinguished between direct and indirect assistance.
These efforts eventually resulted in DHS's promulgating regulations
and the other Agencies promulgating amendments to their regulations. In
April 2016, the Agencies promulgated a joint final rule through notice-
and-comment rulemaking to ensure consistency with Executive Order
13279, as amended by Executive Order 13559. See Federal Agency Final
Regulations Implementing Executive Order 13559: Fundamental Principles
and Policymaking Criteria for Partnerships With Faith-Based and Other
Neighborhood Organizations, 81 FR 19355 (April 4, 2016).
The revised regulations defined ``indirect Federal financial
assistance'' in a way that sought to indicate that the aid must flow to
a beneficiary from a religious provider only through the genuine and
independent choice of the beneficiary. See, e.g., 81 FR at 19381
(describing ``indirect'' assistance programs as those in which the
benefits under the program are provided as a result of a ``genuine and
independent choice''); id. at 19406-07 (defining ``indirect Federal
financial assistance'' in terms of whether, inter alia, the
``organization receives the assistance as the result of the decision of
the beneficiary, not a decision of the government''). The rules also
provided that aid would be considered ``indirect'' only if
beneficiaries had at least one secular option as an alternative to the
faith-based provider. See id. at 19407. Further, the rules not only
required that faith-based providers give the notice of the right to an
alternative provider specified in Executive Order 13559, but also
required faith-based providers, but not other providers, to give
written notice to beneficiaries and potential beneficiaries of programs
funded with direct Federal financial assistance of various protections,
including nondiscrimination based on religion, the requirement that
participation in any religious activities must be voluntary and that
they must be provided separately from the federally funded activity,
and that beneficiaries may report violations. E.g., id. at 19423.
President Trump has given new direction to the program established
by President Bush and continued by President Obama. On May 4, 2017,
President Trump issued Executive Order 13798, 82 FR 21675 (May 4, 2017)
(Promoting Free Speech and Religious Liberty). Executive Order 13798
states that ``Federal law protects the freedom of Americans and their
organizations to exercise religion and participate fully in civic life
without undue interference by the Federal Government. The executive
branch will honor and enforce those protections.'' It directed the
Attorney General to ``issue guidance interpreting religious liberty
protections in Federal law.'' Pursuant to this instruction, the
Attorney General subsequently published guidance in the Federal
[[Page 82039]]
Register. See Federal Law Protections for Religious Liberty, 82 FR
49668 (Oct. 26, 2017) (``the Attorney General's Memorandum'').
The Attorney General's Memorandum emphasizes that individuals and
organizations do not give up religious liberty protections by providing
government-funded social services, and that ``government may not
exclude religious organizations as such from secular aid programs . . .
when the aid is not being used for explicitly religious activities such
as worship or proselytization.'' Id. at 49669.
On May 3, 2018, President Trump signed Executive Order 13831, 83 FR
20715 (May 3, 2018) (Establishment of a White House Faith and
Opportunity Initiative), amending Executive Order 13279, as amended by
Executive Order 13559, and other related Executive Orders. Among other
things, Executive Order 13831 changed the name of the ``White House
Office of Faith-Based and Neighborhood Partnerships'' as established in
Executive Order 13498, to the ``White House Faith and Opportunity
Initiative''; changed the way that the initiative is to operate;
directed departments and agencies with ``Centers for Faith-Based and
Community Initiatives'' to change those names to ``Centers for Faith
and Opportunity Initiatives''; and ordered that departments and
agencies without a Center for Faith and Opportunity Initiatives
designate a ``Liaison for Faith and Opportunity Initiatives.''
Executive Order 13831 also eliminated the alternative provider referral
requirement and requirement of notice thereof in Executive Order 13559
described above.
On January 17, 2020, DHS, USDA, USAID, DOJ, DOL, VA, HHS, and ED
issued NPRMs with proposed regulatory amendments to implement Executive
Order 13831 and conform more closely to the Supreme Court's current
First Amendment jurisprudence; relevant Federal statutes such as RFRA;
Executive Order 13279, as amended by Executive Orders 13559 and 13831;
and the Attorney General's Memorandum. Equal Participation of Faith-
Based Organizations in DHS's Programs and Activities: Implementation of
Executive Order 13831, 85 FR 2889 (Jan. 17, 2020); Equal Opportunity
for Religious Organizations in U.S. Department of Agriculture Programs:
Implementation of Executive Order 13831, 85 FR 2897 (Jan. 17, 2020);
Equal Participation of Faith-Based Organizations in USAID's Programs
and Activities: Implementation of Executive Order 13831, 85 FR 2916
(Jan. 17, 2020); Equal Participation of Faith-Based Organizations in
Department of Justice's Programs and Activities: Implementation of
Executive Order 13831, 85 FR 2921 (Jan. 17, 2020); Equal Participation
of Faith-Based Organizations in the Department of Labor's Programs and
Activities: Implementation of Executive Order 13831, 85 FR 2929 (Jan.
17, 2020); Equal Participation of Faith-Based Organizations in Veterans
Affairs Programs: Implementation of Executive Order 13831, 85 FR 2938
(Jan. 17, 2020); Ensuring Equal Treatment of Faith-Based Organizations,
85 FR 2974 (Jan. 17, 2020); Uniform Administrative Requirements, Cost
Principles, and Audit Requirements for Federal Awards, Direct Grant
Programs, State-Administered Formula Grant Programs, Developing
Hispanic-Serving Institutions Program, and Strengthening Institutions
Program, 85 FR 3190 (Jan. 17, 2020). On February 13, 2020, HUD issued a
parallel NPRM. Equal Participation of Faith-Based Organizations in HUD
Programs and Activities: Implementation of Executive Order 13831, 85 FR
8215 (Feb. 13, 2020). These NPRMs proposed to do the following:
Remove the notice-and-referral requirements that were
required of faith-based organizations but were not required of other
organizations;
Require the Agencies' notices or announcements of award
opportunities and notices of awards or contracts to include language
clarifying the rights and obligations of faith-based organizations that
apply for and receive Federal funding. ED, DHS, USDA, DOJ, DOL, HUD,
VA, and HHS proposed specific language in these notices to clarify
that, among other things, a faith-based organization may apply for
awards on the same basis as any other organization, the Agencies will
not discriminate in selection on the basis of the organization's
religious exercise or affiliation, a participating faith-based
organization retains its independence and may carry out its mission
consistent with--and may be able to seek an accommodation under--
religious freedom protections in Federal law, and a faith-based
organization may not discriminate against beneficiaries on certain
religious bases;
Clarify that accommodations are available to faith-based
organizations under existing Federal law and directly reference the
definition of ``religious exercise'' from RFRA;
Update the prohibitions against the Agencies (and, for
some Agencies, their intermediaries) discriminating in selection and
disqualifying an organization, so as to prohibit such conduct on the
basis of religious exercise and affiliation;
Update the definition of ``indirect Federal financial
assistance'' to align more closely with the Supreme Court's decision in
Zelman v. Simmons-Harris, 536 U.S. 639 (2002), by removing the
requirement that beneficiaries have at least one secular option;
Clarify the existing provision that a faith-based
organization participating in an indirect Federal financial assistance
program or activity need not modify its program to accommodate a
beneficiary, so that it expressly states that such an organization need
not modify its policies that require attendance in ``all activities
that are fundamental to the program;''
Clarify that faith-based organizations participating in
Agency-funded programs shall retain their autonomy, right of
expression, religious character, and independence;
Clarify that none of the guidance documents that the
Agencies or their intermediaries use in administering the Agencies'
financial assistance shall require faith-based organizations to provide
assurances or notices where similar requirements are not imposed on
secular organizations, and that any restrictions on the use of grant
funds shall apply equally to faith-based and secular organizations;
Clarify that faith-based organizations need not remove,
conceal, or alter any religious symbols or displays;
Clarify the standard for permissible discrimination on the
basis of religion with respect to employment or board membership, as
relevant;
Clarify the methods that can be used to demonstrate
nonprofit status;
Update the terminology to refer to ``faith-based
organizations,'' not ``religious organizations;'' and
Clarify that the Agencies and their intermediaries cannot
advantage or disadvantage faith-based organizations affiliated with
historic or well-established religions or sects in comparison with
other religions or sects.
These final regulations are effective on January 19, 2021. In light
of the public comments and as explained further below, the Agencies are
making the following changes from the NPRMs:
Update the prohibitions against the Agencies (and, for
some Agencies, their intermediaries) discriminating in selecting and
disqualifying an organization, so as to prohibit such conduct on the
basis of religious character and affiliation, and add such a
prohibition against discrimination on the basis of religious exercise
with
[[Page 82040]]
additional language based on the applicable Free Exercise Clause and
RFRA standards; and
Update the notices in the appendices for ED, DHS, USDA,
DOJ, DOL, HUD, VA, and HHS to reflect that these prohibitions apply to
discrimination on the basis of religious character, affiliation, or
exercise. These Agencies are also updating such notices to indicate
that the listed Federal laws provide religious freedom ``and
conscience'' protections.
Unless otherwise specified in the discussion below, these final
regulations amend existing regulations or establish new regulations to
do the following, consistent with the NPRMs:
Remove the notice-and-referral requirements that were
required of faith-based organizations but were not required of other
organizations;
Require the Agencies' notices or announcements of award
opportunities and notices of awards or contracts to include language
clarifying the rights and obligations of faith-based organizations that
apply for and receive Federal funding. ED, DHS, USDA, DOJ, DOL, HUD,
VA, and HHS are also including specific language in these notices to
clarify that, among other things, a faith-based organization may apply
for awards on the same basis as any other organization; a participating
faith-based organization retains its independence and may carry out its
mission consistent with--and may be able to seek an accommodation
under--religious freedom (and conscience) protections in Federal law;
\2\ and a faith-based organization may not discriminate against
beneficiaries on certain religious bases;
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\2\ In this rulemaking, the word ``accommodation'' refers both
to provisions of relief from the burdens that a generally applicable
law might impose on religious exercise, such as RFRA and the
Religious Land Use and Institutionalized Persons Act (``RLUIPA,'' 42
U.S.C. 2000cc et seq.), and to protections of conscience more
generally, such as the Coats-Snowe Amendment (42 U.S.C. 238n), the
Weldon Amendment (a rider in HHS's annual appropriation, see, e.g.,
Further Consolidated Appropriations Act, 2020, Pub. L. 116-94, div.
A, sec. 507(d), 133 Stat. 2534, 2607 (Dec. 20, 2019)), the Church
Amendments (42 U.S.C. 300a-7), and 42 U.S.C. 18113.
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Clarify that accommodations are available under existing
Federal law and directly reference the definition of ``religious
exercise'' from RFRA;
Update the definition of ``indirect Federal financial
assistance'' to align more closely with the Supreme Court's decision in
Zelman, 536 U.S. at 639, by removing the requirement that beneficiaries
have at least one secular option;
Clarify the existing provision that a faith-based
organization participating in an indirect Federal financial assistance
program or activity need not modify its program to accommodate a
beneficiary, so that it expressly states that such an organization need
not modify its policies that require attendance in ``all activities
that are fundamental to the program;''
Clarify that faith-based organizations participating in
Agency-funded programs shall retain their autonomy, right of
expression, religious character, and independence;
Clarify that none of the guidance documents that the
Agencies or their intermediaries use in administering the Agencies'
financial assistance shall require faith-based organizations to provide
assurances or notices where similar requirements are not imposed on
secular organizations, and that any restrictions on the use of grant
funds shall apply equally to faith-based and secular organizations;
Clarify that faith-based organizations need not remove,
conceal, or alter any religious symbols or displays;
Clarify the standard for permissible discrimination on the
basis of religion with respect to employment or board membership, as
relevant;
Clarify the methods that can be used to demonstrate
nonprofit status;
Update the terminology to refer to ``faith-based
organizations,'' not ``religious organizations;'' and
Clarify that the Agencies and their intermediaries cannot
advantage or disadvantage faith-based organizations affiliated with
historic or well-established religions or sects in comparison with
other religions or sects.
Additionally, in its NPRM, ED proposed to add severability clauses
to each part of its regulations, and it is finalizing those
severability clauses. USDA, DOL, DOJ, and HHS are also adding a
severability provision indicating that, to the extent that any
provision of this regulation is declared invalid by a court of
competent jurisdiction, the Agency intends for all other provisions
that are capable of operating in the absence of the specific provision
that has been invalidated to remain in effect. They are making this
addition because they conclude that each of the regulations discussed
in this preamble would serve one or more important, related, but
distinct purposes, as demonstrated by the extensive discussion of each
provision below and in the USDA, DOL, DOJ, and HHS NPRMs. This
provision is not a substantive addition, so the Agencies do not believe
that notice and comment is required. Even if notice and comment were
required, the absence of notice and comment for this provision would
not be prejudicial, as commenters received an opportunity to provide
their views on all substantive aspects of the rule. Hence, although the
issue of severability was not raised in the USDA, DOL, DOJ, or HHS
NPRMs, commenters were able to evaluate the practical impact of each
facet of the proposed rules, and finalizing the proposed rules with a
severability provision will not meaningfully alter the rules' impact on
commenters. The Agencies accordingly have concluded that they will not
re-notice the rules to raise the issue of severability. See First Am.
Discount Corp. v. CFTC, 222 F.3d 1008, 1015 (D.C. Cir. 2000) (declining
to decide whether additional notice was required where petitioner
suffered no prejudice).
The Agencies received over 95,000 comments in response to their
NPRMs. The major cross-cutting issues raised in those comments are
discussed in the Joint Preamble (Part II). Many commenters filed
similar or identical comments with some or all of the Agencies. Thus,
unless otherwise noted in response to a particular comment, the
responses in this joint preamble are adopted by all Agencies,
regardless of whether a particular Agency received a particular
comment.
Within each discussion of a category of comments, there are
subheadings entitled ``Summary of Comments,'' ``Response,''
``Changes,'' and ``Affected Regulations.'' Under the ``Changes''
subheading, the Agencies describe the types of changes, if any, that
they are making to the proposed rules as a result of the comments.
Under the ``Affected Regulations'' subheading, the Agencies list the
actual sections of the regulations that they have changed.
Comments that raised issues specific to an Agency or that required
an explanation of how a cross-cutting issue affects an Agency are
addressed in the Agency-Specific Preambles (Part III).
Following is the organization of this rulemaking:
I. Background
II. Joint Preamble
A. General Support and Opposition
B. Regulatory History and Legal Background
1. Executive Orders 13199 and 13279
2. Executive Orders 13498 and 13559
3. Executive Orders 13798 and 13831 and the Attorney General's
Memorandum
C. Notice-and-Referral Requirements
1. Beneficiary Rights
a. Notice and Referral to Alternative Provider
b. Other Notices
2. Beneficiary Harms
a. In General
[[Page 82041]]
b. Specific Examples, Studies, and Hypotheticals
3. Tension With the Free Exercise Clause and RFRA
a. Unequal Burdens
b. Substantial Burdens
c. Compelling Interests
d. Least Restrictive Means and Appropriate Remedy
e. Third-Party Harms
D. Indirect Federal Financial Assistance
1. Definition of ``Indirect Federal Financial Assistance''
a. Consistency With Zelman v. Simmons-Harris
b. Rights of Beneficiaries and Providers
c. Harms to Beneficiaries and Providers
2. Required Attendance at Religious Activities
a. Establishment Clause
b. Clarification
E. Accommodations for Faith-Based Organizations
F. Discrimination on the Basis of Religious Character or
Exercise
1. ``Religious Character''
2. ``Religious Exercise''
a. Scope of ``Religious Exercise''
b. Clarified Basis for Protecting ``Religious Exercise''
G. Rights of Faith-Based Organizations
1. Religious Symbols
2. Nonprofit Status
3. Notice to Faith-Based Organizations
4. Same Requirements for Faith-Based and Secular Organizations
5. Religious Autonomy and Expression
H. Employment and Board Membership
1. Preserving the Section 702 Exemption
2. Acceptance of or Adherence to Religious Tenets
a. Employment
b. Board Membership
I. Conflicts With Other Federal Laws, Programs, and Initiatives
J. Procedural Requirements
1. Comment Period
2. Arbitrariness and Capriciousness
K. Regulatory Certifications
1. Regulatory Impact Analysis (Executive Orders 12866 and 13563)
2. Economic Significance Determination (Executive Order 12866)
3. Deregulatory Action Determination (Executive Order 13771)
4. Federalism (Executive Order 13132)
5. Unfunded Mandates Reform Act
III. Agency-Specific Preambles
A. Department of Education
1. Comments in Support
2. Comments in Opposition
a. Concerns Regarding Discrimination and Impact on Programs
b. Concerns Regarding Appropriate Use of Taxpayer Dollars
c. Concerns Regarding Potential for Religious Compulsion
d. Concerns Regarding Modifications
e. Severability Clauses
B. Department of Homeland Security
C. Department of Agriculture
D. Agency for International Development
1. Notice and Alternative Provider Requirements
2. ``Religious Organizations'' to ``Faith-Based Organizations''
3. Reasonable Accommodations
4. Religious Character and Religious Exercise
5. Exemption From Title VII Prohibitions for Qualifying
Organizations Hiring Based on Acceptance of, or Adherence to,
Religious Tenets
6. Assurances from Religious Organizations With Sincerely Held
Religious Beliefs
7. Findings and Certifications
a. Regulatory Flexibility Act
b. Paperwork Burden
E. Department of Housing and Urban Development
1. Other Conflicting Laws
2. Conflicting Agency Programs and Policies
3. Procedural Issues
a. Comment Period
b. Rulemaking Authority
c. RIA/Administrative Sections
F. Department of Justice
G. Department of Labor
1. Beneficiary Harms
2. Notice Requirement
3. Deregulatory Action Determination (Executive Order 13771)
4. General Comments
H. Department of Veterans Affairs
I. Department of Health and Human Services
1. Nondirective Mandate
2. Certain Provisions of the ACA
3. Notice Requirements in Other Department Regulations
4. Medical Ethics
5. Discrimination Against Women, Persons With Disabilities, Low-
Income Persons, and LGBT Persons
IV. General Regulatory Certifications
A. Regulatory Planning and Review (Executive Order 12866);
Improving Regulation and Regulatory Review (Executive Order 13563)
1. Costs
2. Cost Savings
3. Benefits
B. Regulatory Flexibility Analysis
C. Civil Justice Reform (Executive Order 12988)
D. Consultation and Coordination With Indian Tribal Governments
(Executive Order 13175)
E. Federalism (Executive Order 13132)
F. Reducing Regulation and Controlling Regulatory Costs
(Executive Order 13771)
G. Paperwork Reduction Act
H. Unfunded Mandates Reform Act
V. Final Regulations
Department of Education
Department of Homeland Security
Department of Agriculture
Agency for International Development
Department of Housing and Urban Development
Department of Justice
Department of Labor
Department of Veterans Affairs
Department of Health and Human Services
II. Joint Preamble
A. General Support and Opposition
Summary of Comments: Several commenters, including Members of
Congress, agreed with the proposed rules and said that they protect
religious liberty for faith-based organizations, including as
guaranteed by the First Amendment to the U.S. Constitution. These
commenters added that faith-based organizations are allowed to
participate in Federal funding programs. Some commenters disagreed,
however, arguing that no Federal funds should be given to faith-based
organizations, including because such organizations are exempt from
paying taxes. Some commenters argued that such faith-based
organizations should be taxed.
Several commenters supported the proposed rules because, they said,
faith-based organizations should be allowed to compete on equal footing
with secular organizations, without any discriminatory or unfair
restrictions imposed based on religious character, affiliation, or
exercise, which would raise constitutional problems. Some of these
commenters also stated that such equal treatment aligns the proposed
rules with Trinity Lutheran Church of Columbia, Inc. v. Comer, 137 S.
Ct. 2012 (2017). A common theme among these commenters was that
organizations should not be forced to check their faith at the door
when participating in government programs. Other commenters argued,
however, that faith-based organizations have no entitlement to receive
discretionary Federal financial assistance from the Agencies. Rather,
these commenters argued that faith-based organizations need to be made
aware of their obligations to comply with program requirements and with
beneficiaries' constitutional protections. Some commenters said that
faith-based organizations can exercise religion fully with private
funds but need to serve all if they choose to accept Federal funds. One
of these commenters stated that the proposed rules presented a solution
in search of a problem, arguing that there is no indication faith-based
organizations were harmed under the prior rule.
Some commenters supported the proposed rules because they would
clarify and reinforce existing Federal law regarding faith-based
organizations' rights to freely exercise their religion and participate
in civic life. They argued that the proposed rules were not a radical
shift in policy. Some of these commenters also noted that the proposed
rules would provide faith-based organizations with clarity regarding
these rights. These commenters argued that such rights were unclear,
given what they perceived as conflicts between the prior rule and
Federal law, including constitutional rights to be free from
discrimination
[[Page 82042]]
based on religious character when participating in the Agencies'
programs. For example, some commenters noted that the prior rule forced
only faith-based organizations (and no other organizations) to give
assurances and notices, which, they argued, was a violation of the Free
Exercise Clause.
Some commenters argued that the proposed rules, by creating greater
clarity and removing burdens, would enhance faith-based organizations'
participation in Federal programs, thus expanding the scope of social
services provided to people in need. Some of these commenters also
emphasized the role that faith-based organizations play in promoting
the public good and human flourishing in the public square, including
teaching, providing medical services, serving underserved communities,
and participating in the foster care system. One commenter relied on
data estimating the large dollar amounts--over one trillion dollars in
total, and billions by specific groups and denominations--that
religious organizations contribute to the economy annually. One
commenter to HUD supported the proposed rules because equal
participation by faith-based organizations is ``essential to
revitalizing communities,'' including to ``bridge the gap between
communities and government.''
Other commenters argued that the proposed rules would violate the
Establishment Clause. They argued that the proposed rules could create
impermissible third-party harms, could lead to religious coercion or
proselytizing, could result in the use of taxpayer funds to favor
certain religions over others, could create divisiveness, and could
further entangle government and religion. Some of these commenters were
also concerned that the proposed rules would allow the use of taxpayer
funding for religious exercise or programming, contrary to taxpayers'
consciences. These commenters argued that such funding would be
contrary to the views of James Madison, as expressed in the Memorial
and Remonstrance Against Religious Assessments (``Memorial and
Remonstrance'') in 1785, and of Thomas Jefferson, as expressed in a
bill that ultimately became the Virginia Statute for Religious Freedom
in 1786 (``Bill for Religious Freedom'').\3\
---------------------------------------------------------------------------
\3\ See James Madison, To the Honorable the General Assembly of
the Commonwealth of Virginia: A Memorial and Remonstrance (ca. June
20, 1785), Founders Online, National Archives, https://founders.archives.gov/documents/Madison/01-08-02-0163 (``Memorial
and Remonstrance''); Thomas Jefferson, A Bill for Establishing
Religious Freedom (June 18, 1779), Founders Online, National
Archives, https://founders.archives.gov/documents/Jefferson/01-02-02-0132-0004-0082 (``Bill for Religious Freedom'').
---------------------------------------------------------------------------
Numerous commenters were concerned that the proposed rules did not
place enough emphasis on the interests of, and the impact on,
beneficiaries. Several of these commenters argued that the proposed
rules would favor faith-based organizations over beneficiaries,
especially vulnerable beneficiaries. Commenters emphasized that
beneficiaries are the focus of these government-funded programs and
deserve consideration equal to, if not greater than, that afforded to
faith-based organizations.
Several of these commenters were concerned that the proposed rules
could cause harms to beneficiaries, including discrimination and denial
of services. These commenters were particularly concerned about
discrimination against groups that these commenters identified as
vulnerable, marginalized, or underserved, including people from
minority religions or professing no religion, women, LGBTQ \4\ people,
people with low incomes, and people with disabilities. Commenters were
concerned that beneficiaries' access to services would be impacted and
that providers could impose religious litmus tests. Commenters were
also concerned about removal of beneficiaries' religious liberty
protections. One commenter also expressed concern regarding potential
discrimination against volunteers.
---------------------------------------------------------------------------
\4\ This rule uses the term ``LGBTQ'' to refer to people
identifying as lesbian, gay, bisexual, transgender, transsexual,
queer, questioning, intersex, asexual, allied, pansexual, or
otherwise, regardless of whether commenters used alternative
acronyms such as LGBTQ+ or LGBTIA.
---------------------------------------------------------------------------
Some commenters impugned the motives behind the proposed rules.
Some commented that the proposed rules were designed--consciously or
unconsciously--to give preferences, and ensure aid flows, to specific
officials' religious denominations. One commenter argued that the
proposed rules were designed to further discrimination under the guise
of promoting faith-based organizations' religious freedom.
Response: The Agencies agree with the comments that said the
proposed rules (and this final rule) protect the religious liberty of
faith-based organizations. The First Amendment allows faith-based
organizations to participate, and compete on equal footing with secular
organizations, in neutral government funding programs. See, e.g.,
Espinoza v. Mont. Dep't of Revenue, 140 S. Ct. 2246, 2254 (2020) (``We
have repeatedly held that the Establishment Clause is not offended when
religious observers benefit from neutral government programs.''). This
final rule applies to such neutral Federal financial assistance
programs and activities, removes burdens that were imposed solely on
faith-based organizations, prohibits the imposition of additional such
burdens, and more clearly conforms these regulations with existing
Federal law, including constitutional law.
Contrary to some comments, the tax-exempt status of faith-based
organizations does not preclude them from participating in Federal
financial assistance programs and activities. See 26 U.S.C. 501(c)(3).
The Agencies also note that these programs are open to tax-exempt
secular organizations and, as discussed in Part III.G.2 below, to
faith-based organizations that pay taxes.
To be sure, the Agencies agree with commenters that faith-based
organizations, like all other organizations, have no entitlement to
receive discretionary Federal financial assistance from the Agencies.
But this final rule does not provide for any such entitlement. This
final rule merely removes barriers to equal competition. It does not
require any faith-based organization to be awarded Federal financial
assistance in any program. Under this final rule, such award decisions
will be made on neutral terms, consistent with Federal law.
The Agencies also agree with the comment that the added
accommodation language merely clarifies and reinforces Federal law
regarding faith-based organizations' rights to exercise their religion
and participate in civic life. Federal law requires or permits certain
accommodations, see, e.g., 42 U.S.C. 2000bb-1, and this final rule
merely clarifies the application of this law, as discussed in Part
II.E. Similarly, the changes discussed in Parts II.D, II.F, II.G, and
II.H bring these regulations into clearer conformity with existing
Federal religious liberty law in those areas. The other changes ensure
that faith-based organizations are eligible on equal terms with other
organizations, which is consistent with and alleviates tension with the
First Amendment and RFRA, as discussed in Parts II.C and II.G.
The Agencies also agree with the comment that said it is important
to give faith-based organizations notice of their obligation to comply
with program requirements and beneficiaries' protections. This final
rule provides for such notice, as discussed in Parts II.C and II.G.3
below.
[[Page 82043]]
The Agencies disagree with the comment that said this final rule is
a solution in search of a problem. Each provision in this final rule is
being issued to address valid concerns, as discussed throughout this
preamble. If anything, the alternative provider notice-and-referral
requirements were solutions in search of a problem because, as
discussed in Part II.C, there is no indication anyone sought a referral
under those provisions, and there is no indication anyone has ever
sought a referral under a separate HHS program where a statute mandates
reporting of all referral requests.
The Agencies disagree with the commenters that said this final rule
violates the Establishment Clause. As discussed in each relevant
section below, each change is consistent with the Establishment Clause.
Third-party harms are discussed extensively in Parts II.C, II.D, and
II.F, and this final rule retains the prohibition on religious coercion
and proselytizing. Also, as demonstrated throughout this Joint
Preamble, there is no indication that this final rule will lead to any
improper use of taxpayer funds to favor certain religions, to create
divisiveness, or to entangle government and religion.
The Agencies also disagree with the commenters that the proposed
rule would allow the use of taxpayer funds for religious exercise or
programming in any improper way. This final rule retains the
prohibition on explicitly religious activities in programs and
activities funded with direct Federal financial assistance. Although
indirect Federal financial assistance may be used for explicitly
religious activities under this rule, the same was true under the prior
rule, see, e.g., 81 FR at 19358, 19361-62, 19419. This practice is
consistent with Federal religious liberty laws, including the Religion
Clauses of the First Amendment, as discussed in Part II.D.
The Agencies' conclusions are not affected by Madison's Memorial
and Remonstrance or Jefferson's Bill for Religious Freedom. As they
discuss throughout, this final rule is consistent with the Constitution
and with governing statutes, as interpreted by the Federal courts. Any
inconsistency with a pre-constitutional writing or State statute would
not affect this final rule. Indeed, both documents cited by commenters
contain several arguments that would not be considered appropriate for
a government under current constitutional doctrine.\5\
---------------------------------------------------------------------------
\5\ See, e.g., Memorial and Remonstrance (objecting to bill as
``adverse to the diffusion of the light of Christianity'' because it
should be the ``first wish of those who enjoy this precious gift''
to be that it ``may be imparted to the whole race of mankind'');
Bill for Religious Freedom (stating that ``Almighty God hath created
the mind''); id. (rejecting certain coercive civil actions as ``a
departure from the plan of the holy author of our religion'').
---------------------------------------------------------------------------
Regardless, this final rule is consistent with the broader
principles animating Madison's Memorial and Remonstrance and
Jefferson's Bill for Religious Freedom. Madison's Memorial and
Remonstrance criticized a 1784 bill that would have provided for non-
neutral funding--it mandated a tax to fund Christian teachers, with
categorical exemptions for specific denominations.\6\ Thus, similar to
this final rule and current constitutional doctrine, Madison's Memorial
and Remonstrance did not reflect opposition to faith-based
organizations receiving neutral government funding on the same terms as
other organizations.\7\
---------------------------------------------------------------------------
\6\ Memorial and Remonstrance (charging that the 1784 bill
``violates equality by subjecting some to peculiar burdens'' and
``by granting to others peculiar exemptions'').
\7\ See, e.g., Rosenberger v. Rector and Visitors of Univ. of
Va., 515 U.S. 819, 854 (1995) (Thomas, J., concurring) (``Madison's
objection to the assessment bill did not rest on the premise that
religious entities may never participate on equal terms in neutral
government programs. . . . Madison's comments are more consistent
with the neutrality principle[.]'').
---------------------------------------------------------------------------
Additionally, Jefferson's Bill for Religious Freedom denounced the
power of the Government--as embodied by the ``magistrate''--to dictate
permissible religious expression. For example, Jefferson's bill said
that the civil magistrate cannot be allowed ``to restrain the
profession or propagation of principles on supposition of their ill
tendency,'' calling that ``a dangerous fa[l]lacy, which at once
destroys all religious liberty.'' That sentiment is consistent with the
added language in this final rule regarding faith-based organizations'
religious autonomy and expression, as discussed in Part II.G.5.
The Agencies agree with the comments that said this final rule
provides greater clarity regarding faith-based organizations' religious
liberties within the affected Federal financial assistance programs and
activities. These rights were unclear under the prior rule, and
improving clarity will increase participation for beneficiaries,
including in unserved and underserved communities, as explained in the
relevant Parts below. The Agencies also agree that these outcomes will
help satisfy the needs of the beneficiaries of these programs, a
consideration on which the Agencies place significant emphasis when
designing and implementing these programs. And the Agencies recognize
the contributions that both faith-based and secular organizations make
to such beneficiaries, which contributions warrant allowing such
organizations to compete on equal terms for Federal financial
assistance. As discussed in detail throughout this preamble, the
Agencies disagree that this final rule de-emphasizes, disfavors, or
harms beneficiaries at the expense of faith-based organizations.
There is no indication that any aspect of this final rule will lead
to the harms asserted by commenters, including discrimination and
denial of service, as explained in each section below. Because this
final rule retains the prohibition on faith-based organizations
discriminating against beneficiaries on religious bases, such
organizations cannot impose a religious litmus test on beneficiaries.
Faith-based organizations must comply with any other nondiscrimination
provisions that apply to each program. This final rule does not change
that requirement. The only relevant aspect of this final rule is the
added accommodation language, which merely clarifies that otherwise
binding Federal law applies. The accommodation language added in this
final rule does not create any new bases for broader accommodations
that would authorize discrimination or the denial of service, as
discussed in Part II.E.
Additionally, the treatment of volunteers is beyond the scope of
this final rule. The prior rule, Executive Order 13831, and the NPRMs
did not address volunteers. Therefore, the Agencies are not addressing
volunteers directly in this final rule. To the extent that volunteers
are impacted indirectly by any provision in this final rule, that
provision is appropriate for the reasons discussed in the relevant Part
below.
Finally, this final rule is being promulgated for the reasons
discussed throughout this preamble. The Agencies disagree with the
comments that question the motivation behind this final rule. Because
this final rule applies equally to all faith-based organizations, there
is no basis for the comment that this rule is motivated by the desire
to favor any specific religious denomination. Similarly, this final
rule does not permit discrimination by faith-based organizations,
indicating that a desire to allow for such discrimination was not a
motive for the rule.
Changes: None.
Affected Regulations: None.
B. Regulatory History and Legal Background
As explained in the NPRMs, the primary purpose of this final rule
is to implement Executive Order 13831, the most recent in a series of
executive
[[Page 82044]]
orders that address issues that affect faith-based and community
organizations. As discussed in Part I above, the NPRMs provided a
summary of those executive orders, as well as the Attorney General's
Memorandum that was drafted and published pursuant to Executive Order
13798. Because many of the commenters who addressed Executive Order
13798 also referenced the Attorney General's Memorandum, the Agencies
respond to those comments in the discussion of Executive Order 13798
below.
1. Executive Orders 13199 and 13279
Summary of Comments: A number of commenters who supported and
opposed the proposed rules referenced President George W. Bush's
Executive Orders 13199 and 13279. Some commenters stated that the
proposed rules were consistent with Executive Order 13279, which helped
to ensure that faith-based organizations have equal protection and
opportunity under the law as they work to meet the social needs of
American communities.
Other commenters stated that removing the alternative provider
requirements would stray greatly from tradition, current practice, and
consensus in this area. They noted that ``Charitable Choice'' laws,
which were precursors to the George W. Bush administration's faith-
based regulations, included alternative provider requirements. See,
e.g., 42 U.S.C. 290kk-1(f), 300x-65(e), 604a(e). One commenter stated
that the NPRMs would stray from Executive Orders 13199 and 13279 by
reducing the efficacy of distributing Federal funding. Another
commenter stated that repealing or weakening the core beneficiary
protections in the 2016 final rule is inconsistent with Executive Order
13279, which continues to bind the Agencies.
One commenter objected that these executive orders sidestepped the
bipartisan process and allowed for government-funded religious
discrimination. Some commenters also expressed the sentiment that
Executive Order 13279 and this final rule were contrary to the
``separation of church and state.''
Response: The Agencies disagree that removing the alternative
provider notice-and-referral requirements undermines principles of
equal treatment or strays from tradition. To the contrary, removing
these requirements serves to remove unnecessary regulatory barriers to
enable faith-based organizations to compete for, and participate fully
in, Federal financial assistance without impairing their independence,
autonomy, expression, or religious character. Additionally, removal of
the notice-and-referral requirements does not ``stray greatly from
tradition.'' First, doing so merely reinstates the status quo prior to
2016. Second, although there may be a pre-2016 practice of requiring
referrals in the programs to which the Charitable Choice statutes cited
by the commenters are applicable, the Agencies are not aware that any
beneficiary has ever sought such a referral under one of those
statutes, or that any beneficiary ever sought a referral under
analogous provisions of the prior rule. See Part II.C. The Agencies'
experience thus demonstrates that maintaining the referral requirements
is not necessary to avoid harm to beneficiaries.
Additionally, the Agencies disagree that these final rules are
inconsistent with any portions of Executive Orders 13199 and 13279 that
are currently in effect. Executive Order 13199 was revoked by Executive
Order 13831 on May 3, 2018. 83 FR at 20717. Even so, this rule would
have been consistent with Executive Order 13199, which directed the
predecessor White House Office of Faith-Based and Community Initiatives
(now replaced by the White House Faith and Opportunity Initiative) ``to
eliminate unnecessary . . . regulatory[] and other bureaucratic
barriers that impede effective faith-based and other community efforts
to solve social problems.'' 66 FR at 8500. This final rule removes
unnecessary regulatory barriers to enable faith-based organizations to
compete for, and participate fully in, Federal financial assistance
programs and activities without impairing their independence, autonomy,
expression, or religious character.
Executive Order 13279 remains in effect, as amended by Executive
Order 13559 and further amended by Executive Order 13831. Executive
Order 13279 currently provides that faith-based organizations should be
eligible to compete for Federal financial assistance used to support
social service programs and to ``participate fully in [such programs]
without impairing their independence, autonomy, expression, or
religious character.'' 67 FR at 77142. This final rule fulfils that
directive by removing unnecessary regulatory barriers that applied only
to faith-based organizations that wished to participate in federally
funded social service programs.
The Agencies furthermore do not believe that this final rule will
reduce the efficacy of awarding Federal funding. Rather, it will enable
faith-based organizations to participate equally in competing for
Federal funding with secular organizations. If anything, removal of
unnecessary administrative burdens will improve the efficiency and
efficacy of awarding Federal funding. Reduced compliance burdens may
free more resources for beneficiaries, and the removal of requirements
that chill faith-based organizations' participation in Federal
assistance programs may result in a broader, more diverse, and more
competitive pool of grant recipients. Moreover, this final rule
provides greater clarity on several issues, as discussed in Parts II.C,
II.D, II.E, II.G, II.G, and II.H.
The Agencies also disagree that Executive Orders 13199 and 13279
allow for government-funded religious discrimination. The opposite is
true. Although it is no longer effective, the Agencies note that
Executive Order 13199 stated that the delivery of social services in
the United States ``should value the bedrock principles of pluralism,
nondiscrimination, evenhandedness, and neutrality.'' 66 FR at 8499.
Similarly, Executive Order 13279 currently provides that all
organizations that receive Federal financial assistance under social
services programs should be prohibited ``from discriminating against
beneficiaries or prospective beneficiaries of the social services
programs on the basis of religion or religious belief,'' and that such
organizations, in their service-provision and outreach programs using
Federal financial assistance, ``should not be allowed to discriminate
against current or prospective program beneficiaries on the basis of
religion, a religious belief, a refusal to hold a religious belief, or
a refusal to actively participate in a religious practice.'' 67 FR at
77142. This final rule maintains the regulatory prohibition on such
religious discrimination.
The Agencies also do not believe that it is sensible to charge that
an executive order has sidestepped the bipartisan process. An executive
order is the President's exercise of constitutional authority, and the
Agencies have carried out Executive Order 13831 in accordance with
established rules of administrative process that provide full
opportunity for input from people of all parties and perspectives. The
Agencies have carefully reviewed and considered each of the comments
they have received. In most cases, the Agencies are not even aware of,
and in all cases are indifferent to, a commenter's partisan
affiliation. The Agencies have considered each comment based on its
[[Page 82045]]
independent merit. Additionally, to the extent the comment about the
bipartisan process was referring to the 2010 President's Advisory
Council on Faith-Based and Neighborhood Partnerships, the Agencies
incorporate their discussion of that process from Part II.C.
Finally, the Agencies disagree that these executive orders and this
final rule are contrary to ``the separation of church and state.'' Some
of these comments refer to and quote extensively from President Thomas
Jefferson's letter of January 1, 1802 to the Baptist Association of
Danbury, Connecticut, which letter described the First Amendment as
``building a wall of separation between Church & State.'' Thomas
Jefferson, Letter for the Danbury Baptist Association (Jan. 1, 1802),
Founders Online, National Archives, https://founders.archives.gov/documents/Jefferson/01-36-02-0152-0006. The precise meaning and
usefulness of this metaphor for constitutional adjudication remains
unclear. As Justice Frankfurter cautioned, ``the mere formulation of a
relevant Constitutional principle is the beginning of the solution of a
problem, not its answer. This is so because the meaning of a spacious
conception like that of separation of Church from State is unfolded as
appeal is made to the principle from case to case.'' McCollum v. Bd. of
Educ., 333 U.S. 203, 212-13 (1948) (Frankfurter, J., joined by Jackson,
Rutledge, and Burton, JJ.). It is thus critical to recognize that, in
actual cases, the Supreme Court has ``repeatedly held that the
Establishment Clause is not offended when religious observers and
organizations benefit from neutral government programs.'' Espinoza, 140
S. Ct. at 2254. That result is what this final rule achieves, as
explained throughout this preamble.
Allowing for such participation is also consistent with many
interpretations of Jefferson's letter, including that the wall of
separation was intended to protect religion from the state, which this
final rule does.\8\ Furthermore, the relevance of that letter to
constitutional law jurisprudence has been questioned repeatedly,
including because President Jefferson at times invoked religion in his
official actions and approved the use of Federal Government funds for
religious purposes.\9\ Significantly, and consistent with the Supreme
Court's statement in Espinoza, then-Justice Rehnquist explained that,
even when considering Jefferson's wall metaphor, ``[t]he Establishment
Clause did not . . . prohibit the Federal Government from providing
nondiscriminatory aid to religion.'' Wallace v. Jaffree, 472 U.S. 92,
106 (1985) (Rehnquist, J., dissenting). In short, ``[t]he metaphor has
served as a reminder that the Establishment Clause forbids an
established church or anything approaching it. But the metaphor itself
is not a wholly accurate description of the practical aspects of the
relationship that in fact exists between church and state.'' Lynch v.
Donnelly, 465 U.S. 668, 673 (1984)).
---------------------------------------------------------------------------
\8\ See, e.g., Noah Feldman, Divided By God 40 (2007) (arguing
that the ``Jefferson who drafted the Virginia statute'' was
``focus[ed] . . . on protecting religion from government, not the
other way around'').
\9\ See, e.g., Wallace v. Jaffree, 472 U.S. 92, 103 & n.5 (1985)
(Rehnquist, J., dissenting) (observing that a treaty entered into by
the Jefferson administration ``provided annual cash support for [a
Native American tribe's] Roman Catholic priest and church''); Engel
v. Vitale, 370 U.S. 421, 446-49 & n.3 (1962) (Stewart, J.,
dissenting); McCollum, 333 U.S. at 245-47 (Reed, J., dissenting);
see also Daniel L. Dreisbach, Thomas Jefferson and the Wall of
Separation Between Church and State 21-23 (2003) (noting that,
although Jefferson declined to issue religious proclamations of
thanksgiving, nonetheless, ``as the nation's head of state, he
personally encouraged and symbolically supported religion by
attending public church services in the Capitol'' and ``attend[ing]
worship services on government property''); id. at 29-30 (explaining
the argument that the letter in which Jefferson expressed the wall
metaphor was a ``political manifesto,'' rather than an attempt to
define Establishment Clause jurisprudence). See generally Philip
Hamburger, Separation of Church and State (2002).
---------------------------------------------------------------------------
Changes: None.
Affected Regulations: None.
2. Executive Orders 13498 and 13559
Summary of Comments: A number of commenters--some who supported and
some who opposed the proposed rules--referenced President Barack
Obama's Executive Orders 13498 and 13559. Commenters who supported the
proposed rules stated that the Obama Administration's changes to the
equal treatment rule had placed extra and unfair burdens on faith-based
entities, discriminated against such entities (including by allowing
religious participation in indirect-aid programs only if there was a
secular alternative without imposing a reverse requirement on secular
providers), treated such entities as suspect purely because of their
religious nature, and ignored the gravity of religious complicity-based
objections, contrary to the First Amendment, RFRA, Supreme Court
precedent, and binding legal principles described in the Attorney
General's Memorandum.
One commenter also asserted that the notice-and-referral
requirements established by Executive Order 13559 were unconstitutional
compelled speech under National Institute of Family Life Advocates v.
Becerra, 138 S. Ct. 2361 (2018), because they required only faith-based
organizations to give the scripted disclosure.
Commenters who objected to the proposed rules drew attention to
President Obama's 2016 Executive Order 13559, which they characterized
as putting significant safeguards for beneficiaries into place based on
consensus recommendations of the President's Advisory Council on Faith-
Based and Neighborhood Partnerships, a body composed of religious and
community leaders from a wide range of faiths and organizations.
A commenter from a faith-based organization supported the notice-
and-referral requirements of Executive Order 13559 as striking the
right balance between ensuring the continuation of public-private
partnerships with faith-based organizations to provide social services,
consistent with the Constitution, RFRA, and Supreme Court precedent,
and ensuring that millions of beneficiaries of these programs were not
subject to proselytizing by publicly funded service providers and that
viable secular alternatives are available and accessible.
Finally, one commenter protested that the proposed rules would
allow organizations that accept ``indirect'' aid to require
beneficiaries to participate in religious activities, in conflict with
Executive Order 13559.
Response: The Agencies agree with the commenters who stated that
the notice-and-referral requirements of Executive Order 13559 were in
tension with Supreme Court precedent, RFRA, and free exercise
principles, as explained in Part II.C.
The Agencies disagree with the suggestions that they must follow
the recommendations in the Final Report of the President's Advisory
Council on Faith-Based and Neighborhood Partnerships (``Advisory
Council Report''), although the Agencies have certainly given those
recommendations all due consideration. As discussed at greater length
in Part II.C, those recommendations were just that and are not
controlling. The Agencies are promulgating this final rule after
carefully considering over 95,000 public comments from a wide array of
sources, including private citizens, advocacy groups, religious
organizations, public policy organizations, State and local
governments, and Members of Congress. That process reflects a diversity
of input no less than did the recommendations of the Advisory Council
comprising ``not more than 25 members appointed by the President'' in
2009. See 74 FR at 6534.
[[Page 82046]]
Further, the Advisory Council Report cited minimal justification
for requiring religious organizations to make referrals based on
objections to the provider's religious character. The Agencies did not
find this justification persuasive, as discussed in Part II.C below.
There is also no indication that any beneficiary sought such a
referral, before or after the referral requirement was imposed in 2016,
or that any beneficiary would be harmed by removing the referral
requirement. The Agencies disagree that the referral requirement was a
critical religious liberty protection and that it must be retained in
order to put primary emphasis on the needs of beneficiaries.
The Agencies respond to the comments regarding RFRA, free exercise,
and related Supreme Court precedents at length elsewhere in this final
rule, especially in Parts II.C, II.E, II.F, and II.G. They incorporate
that analysis by reference here. The Agencies also clarify that they
are not relying on the Free Speech Clause as a basis for removing the
notice requirement. The Agencies do not rely on Becerra, 138 S. Ct.
2361. That case is different for several reasons, including because the
law in that case did not impose a notice requirement on recipients of
government funding.
Finally, the Agencies disagree that the updated definition of
``indirect Federal financial assistance'' in this final rule conflicts
with Executive Order 13559 because it would permit organizations
receiving indirect aid, such as vouchers, to require religious
observance as part of their activities. Indirect Federal financial
assistance, by definition, permits the beneficiary to choose where to
use the assistance. Executive Order 13559 recognized ``the distinction
between `direct' and `indirect' Federal financial assistance,'' 75 FR
at 71321, and it did not restrict what an organization at which a
beneficiary chose to use the indirect assistance might require of the
beneficiary in terms of religious observance. It imposed restrictions
only on organizations receiving direct assistance, stating that
organizations that engage in explicitly religious activities must
perform such activities and offer such services outside of programs
that are supported with ``direct'' Federal financial assistance; that
such organizations must do so separately in time or location from any
such programs or services supported with ``direct'' Federal financial
assistance; and that participation in any such explicitly religious
activities must be voluntary for the beneficiaries of the social
service program supported with ``such'' Federal financial assistance.''
Id. at 73120. The updated definition of ``indirect Federal financial
assistance'' is valid for all of the reasons discussed in Part II.D
below.
Changes: None.
Affected Regulations: None.
3. Executive Orders 13798 and 13831 and the Attorney General's
Memorandum
Summary of Comments: A number of commenters--some who supported and
some who opposed--the proposed rules referenced President Donald
Trump's Executive Orders 13798 and 13831, as well as the Attorney
General's Memorandum. Several commenters stated that the proposed rules
were consistent with the provisions of Executive Orders 13798 and
13831, the Attorney General's Memorandum, and the Constitution because
of their equal treatment of religious groups. They said that these
Executive Orders and the proposed rules restore constitutional
freedoms, respect the rights of religious taxpayers and beneficiaries,
and allow religious organizations to further support the community
rather than focus on additional federally mandated burdens. Several
commenters expressed their support for Executive Order 13831, including
one organization that concluded that neutral treatment by government
not only allows religious organizations to operate in accordance with
their faith but also promotes the flourishing of the common good.
A comment provided jointly by 21 current members of the House of
Representatives stated that the final rule implementing Executive Order
13831 ``will restore an environment of religious freedom across the
country'' because ``an organization's religious affiliation will no
longer subject individuals to unequal treatment by Federal, state, and
local governments.''
Other commenters contended that the proposed rules were contrary to
Executive Order 13831 because they exhibited favoritism toward
religious organizations for purely political reasons. One commenter
charged that the proposed rules were inconsistent with Executive Order
13798 because they would limit end-of-life care options for people with
terminal illnesses.
Another commenter said that Executive Order 13831 contradicted
Executive Order 13798, which states that Federal law protects the
freedom of Americans and their organizations to exercise religion and
participate fully in civic life without undue interference by the
Federal Government.
One commenter stated that the Agencies' reliance on the Attorney
General's Memorandum was misplaced, and that the Memorandum violated
the Establishment Clause, had questionable legal authority, and was an
expansion of religious freedom exemptions and protections that allowed
religious institutions to discriminate and harm others. Another
commenter said that Executive Order 13831 was contrary to the
separation of church and state.
Response: The Agencies agree that this final rule is consistent
with Executive Order 13798, which states that the Federal Government
will honor the ``freedom of Americans and their organizations to
exercise religion and participate fully in civic life without undue
interference by the Federal Government.'' 82 FR at 21675. The final
rule fulfills this promise.
The Agencies agree that the final rule is consistent with Executive
Order 13831 as well. Executive Order 13831 charged the White House
Faith and Opportunity Initiative with identifying ways to reduce
``burdens on the exercise of religious convictions and legislative,
regulatory, and other barriers to the full and active engagement of
faith-based and community organizations'' in Government-funded
programs, in accordance ``with Executive Order 13798 and the Attorney
General's Memorandum.'' 83 FR at 20716.
The Agencies disagree that there is any contradiction between
Executive Orders 13798 and 13831. The Agencies further believe that the
final rule is consistent with Executive Order 13798 and will not have
any discernable impact on individuals with terminal illnesses because,
as explained more fully in Part II.C.2, the rule will not negatively
impact beneficiaries.
The Agencies also agree that this final rule is consistent with the
Attorney General's Memorandum, which summarizes current jurisprudence
on religious liberty, including the First Amendment prohibition against
discrimination based on religious character and RFRA protections. That
Memorandum accurately canvasses the legal authorities governing
executive branch agencies' treatment of religion, including the
Constitution, Supreme Court precedents, Federal statutes (e.g., RFRA,
Title VII of the Civil Rights Act of 1964, including the religious
exemption to Title VII, the Religious Land Use and Institutionalized
Persons Act, and the American Indian Religious Freedom Act), numerous
executive orders, and the Guidelines on Religious Exercise and
Religious Expression in the Federal Workplace, which President Clinton
issued on August 14, 1997. Parts II.C, II.D, II.E, II.G.1, II.G.2, and
II.J explain how the final rule is consistent with the principles
articulated in the Attorney General's Memorandum. For
[[Page 82047]]
the same reasons, the Agencies do not believe their reliance on the
Attorney General's Memorandum is misplaced. And because the final rule
works to re-establish government neutrality toward religion, the
Agencies do not agree that it favors religious organizations for
political reasons.
Finally, the Agencies disagree that Executive Order 13831 is
contrary to separation of church and state, for the reasons discussed
in Part II.B.1 above.
Changes: None.
Affected Regulations: None.
C. Notice-and-Referral Requirements
All of the Agencies' existing regulations, with the exception of
USAID's, require each religious organization receiving direct Federal
financial assistance to give written notice to all beneficiaries that:
(1) The religious organization could not discriminate against them
based on religion or religious belief, a refusal to hold a religious
belief, or a refusal to attend or participate in a religious practice;
(2) the organization could not require them to participate in
explicitly religious activities and any such participation had to be
voluntary; (3) the organization had to separate explicitly religious
activities from the funded program in time or location; (4)
beneficiaries could object to the organization's ``religious
character'' and the organization would then be required to undertake
reasonable efforts to identify an alternative provider to which they
did not object, though there was no guarantee such an alternative would
be available; and (5) beneficiaries could report any violation of these
protections through a specified process. The regulations of DOJ, USDA,
DOL, HHS, HUD, ED, VA, and DHS required religious organizations to
provide this notice to prospective beneficiaries as well. The Agencies
prescribed the specific wording of this notice on forms attached in
Appendices to their regulations in the Code of Federal Regulations.
If a beneficiary were to object to receiving services or benefits
from an organization with a religious character, the Agencies'
regulations required the religious organization to exert reasonable
efforts to refer them to an alternative provider of comparable services
to whom they had no objection and to make a record of the referral.
DOJ, USDA, DOL, HUD, ED, and DHS applied this referral requirement to
organizations receiving direct Federal financial assistance. HHS and VA
applied this referral requirement to organizations receiving both
direct and indirect Federal financial assistance. Secular organizations
were not subject to any equivalent notice-and-referral requirements.
All of the Agencies' NPRMs proposed amending their regulations to
eliminate the notice-and-referral requirements, as well as the
prescribed notice text in the corresponding Appendices. Because USAID
never adopted the notice-and-referral requirements, 81 FR 19384-85, the
comments in this section do not apply to USAID, unless otherwise noted.
Removal of the notice-and-referral requirements was discussed more
extensively in the comments than any other issue in the Agencies'
NPRMs. The Agencies, therefore, have decided to describe these comments
in detail and respond to them at length. Many of the commenters were
not precise in the scope of their comment, including with respect to
what aspect or aspects of the notice-and-referral requirement they were
addressing. The Agencies endeavor to respond to them as best as
possible.
1. Beneficiary Rights
a. Notice and Referral to Alternative Provider
Summary of Comments: The majority of comments regarding
beneficiaries' rights focused on the referral requirement and the
related aspect of the notice requirement, which are here referred to
collectively as the ``alternative provider notice-and-referral
requirements,'' or simply the ``notice-and-referral requirements.''
Many commenters supported removal of these requirements for the reasons
discussed in Part II.C.2 below. Multiple commenters argued that the
existing notice-and-referral requirements struck the appropriate
balance between religious-freedom interests and the need to fulfil each
Agency's mission. One commenter said that the requirements struck the
appropriate balance between beneficiaries' right to access care and
providers' right to maintain their faith-based principles. Other
commenters said that the requirements helped maintain a balance between
protecting beneficiaries' religious freedom and expanding service
delivery through faith-based organizations. Some commenters also noted
that the Advisory Council had agreed that the needs of the people
seeking services must be the primary concern.
Several commenters opposed removal of these requirements, arguing
that they were important, necessary, ``critical,'' and longstanding
protections for the religious liberties of beneficiaries. Many based
this argument on the recommendations of the President's Advisory
Council on Faith-Based and Neighborhood Partnerships' 2010 report. See
President's Advisory Council on Faith-Based and Neighborhood
Partnerships, A New Era of Partnerships: Report of Recommendations to
the President at viii, 140-41 (Mar. 2010), https://obamawhitehouse.archives.gov/sites/default/files/docs/ofbnp-council-final-report.pdf (``2010 Advisory Council Report''). These commenters
argued--independently and based on the Advisory Council Report--that
these protections were part of current practice for respecting
religious liberties, relying on the Charitable Choice statutes that
govern the Substance Abuse and Mental Health Services Administration
(``SAMHSA'') and the Temporary Assistance for Needy Families (``TANF'')
program; the regulations implementing those statutes; proposed
legislation that contained a referral requirement, including
``signature legislation backed by President Bush''; and a statement
from the Administration of President George W. Bush that the Charitable
Choice provisions ``protect the religious freedom of beneficiaries.''
Other commenters reasoned that the referral requirement represents an
important, though unexplained, principle that should be maintained.
Some commenters argued that the alternative provider notice-and-
referral requirements should be retained in their entirety because they
were pillars of the ``consensus'' and common-ground religious liberty
recommendations from the 2010 Advisory Council. See 2010 Advisory
Council Report at 140-41. They said that retaining these requirements
would strengthen the partnerships that the Government had formed and
would help build future consensus that would lead to stronger and more
enduring rules. They also said that the 2010 Advisory Council Report's
recommendations should be preserved because that report claimed to
reflect the first consensus recommendation on these matters from such a
diverse group of participants. Some commenters expressed concern that
removing these requirements would negate this consensus. Some
commenters opined that the Agencies offered no reasonable explanation
for their decision to abandon this careful, consensus-based effort. The
Chair of the 2010 Advisory Council (hereinafter the ``Council Chair''),
who later became the Special Assistant to the President and Executive
Director of the White House Office of Faith-Based and Neighborhood
[[Page 82048]]
Partnerships, and served as the main point of contact for the 2016
final rule, 81 FR 19355, argued in a comment that this change would
disserve beneficiaries, induce policy shifts on ``hotly contested''
issues from administration to administration, and make it harder to
achieve such diverse consensus in the future. Instead, the Council
Chair argued that there should be minimal changes. Some commenters
expressed concern that consensus-based rules were being replaced with
new rules that they claimed were polarizing and problematic and that
put ideology above providing services to people in need.
Several commenters claimed that the alternative provider referral
requirement protected beneficiaries' right not to be ``uncomfortable''
receiving services from religious providers or in religious settings,
even in programs that complied with secular content requirements.
Several commenters said that beneficiaries ``might feel unwelcome'' if
the provider was known to espouse views that characterized the
beneficiaries as sinful or deviant. Some commenters argued that this
referral requirement was imposed solely on faith-based organizations to
protect beneficiaries from risks that do not exist when secular
providers administer benefits.
Some commenters argued that beneficiaries had a right to
alternative provider notice to make them aware of their ability to
object when the service provider was religious, had a religious
affiliation, or exhibited a religious viewpoint. They emphasized the
importance of alternative provider notice-and-referral requirements
when the provider worked to promote, or was associated with, a faith
known to espouse religious views or values contrary to beneficiaries'
or that deemed beneficiaries as sinful or deviant. They said these
requirements were also important in cases when certain providers
alerted beneficiaries that the provider was exempt from certain Federal
regulations and could not or would not help beneficiaries in some
situations. They said that these notice-and-referral requirements
enabled beneficiaries to seek services from providers that they knew
would be required to adhere to all Federal regulations. One commenter
said that potential beneficiaries needed the alternative provider
notice-and-referral requirements to make them aware of alternatives
when they encountered ``impractical or inconvenient services.''
Finally, some commenters questioned the Agencies' bases for
removing the alternative provider notice-and-referral requirements
when, according to them, nothing had changed since 2016. Some
recognized the subsequent decision in Trinity Lutheran but argued that
it did not change the analysis because of the beneficiary harms
discussed in Part II.C.2.a.
Response: The Agencies work hard to safeguard beneficiaries'
religious liberties. The Agencies disagree, however, that the
alternative provider notice-and-referral requirements meaningfully
protected those rights. The vast majority of commenters did not cite
any legal basis for their claim, offering only an unexplained
``principle.'' Moreover, the 2010 Advisory Council Report and those
commenters that did cite a legal basis for their claim relied on
statutes and implementing regulations specific to certain programs,
such as SAMHSA and TANF, that require government entities to make
referrals. However, this final rule removes a different notice-and-
referral requirement from other programs to which those statutes do not
apply, as the 2016 final rule acknowledged, see 81 FR 19399. The 2010
Advisory Council Report and these commenters also relied on legislation
that had been introduced but was never enacted, as well as a generic
statement from the Administration of President George W. Bush referring
to religious liberty protections generally. These sources do not
establish a general right to the alternative provider notice and
referral.
The Agencies also disagree that the alternative provider notice-
and-referral requirements were ``long-standing.'' Apart from the
program-specific statutes, these requirements became part of Federal
law only through the 2016 rulemaking, based on language added to
Executive Order 13279 by Executive Order 13559 in 2010. In 2018,
Executive Order 13831 removed that language. The Agencies appreciate
the hard work, compromise, and consensus-building that went into the
2010 Advisory Council Report's recommendation and the 2016 final rule.
The Agencies do not doubt that the 2010 Advisory Council Report's
recommendation to create notice-and-referral requirements was made in
good faith. The Agencies disagree, however, with the contention that
the 2010 Advisory Council Report made a sufficiently persuasive case
that requiring only faith-based organizations to make such notices and
referrals was necessary to protect the rights of beneficiaries. Also,
the Agencies' experience with the alternative provider notice-and-
referral requirements has led to the conclusion that they were not
needed and, in fact, raise a number of legal and policy concerns, as
discussed later in Part II.C.
Stakeholders should have flexibility to draw different lines at
different times based on differing policy priorities, and no governing
principle limits the Agencies to only minimal changes. The Agencies
trust that diverse stakeholders will work on any future rulemakings in
good faith, just as they have in commenting on this proposed rule and
in countless other contexts. If anything, the changes from the 2016
final rule to this final rule should narrow the scope of hotly
contested issues in this area. The Agencies, of course, are retaining
several of the 2010 Advisory Council Report's recommendations that were
incorporated into the 2016 final rule, including those recommendations
concerning nondiscrimination and explicitly religious activities. See
2010 Advisory Council Report at 129-33.
Accommodating objections to a provider's ``religious character''
did not and does not fit well within existing legal frameworks for
beneficiaries' rights under provisions such as the Establishment
Clause, the Free Exercise Clause, and RFRA. Beneficiaries have no
Establishment Clause right to a referral if they object to a provider's
religious character. Rather, the Supreme Court has ``repeatedly held
that the Establishment Clause'' allows faith-based providers to receive
and use Federal funding on neutral terms. Espinoza, 140 S. Ct. at 2254
(citing Locke v. Davey, 540 U.S. 712, 719 (2004); Rosenberger v. Rector
and Visitors of Univ. of Va., 515 U.S. 819, 839 (1995)). It did not
condition these holdings on a requirement that the faith-based provider
in a government-funded program refer a beneficiary to another provider
in the event that the beneficiary objects to the provider's religious
character. Moreover, the Agencies did not base these requirements on
the Establishment Clause when they initially imposed them in 2016.
The alternative provider notice-and-referral requirements also did
not vindicate beneficiaries' rights under the Free Exercise Clause and
RFRA, except perhaps in exceptional circumstances better addressed if
and when they arise. Instead, they privileged mere discomfort with a
provider's general religious character, irrespective of the
beneficiary's religious status or exercise. The requirement to make a
referral extended to objections with no basis in religious status or
exercise, such as objections based on raw anti-religious animus. For
example, a beneficiary could have objected to being served by a Muslim
organization based on a biased
[[Page 82049]]
and secular view that Islam was to blame for terrorism. There is no
Free Exercise Clause or RFRA right to be referred to another provider
based on such an objection.
At the same time, the referral requirement ignored a religious
beneficiary's objection to receiving federally funded social services
from a secular provider when the beneficiary was uncomfortable with the
secular environment. From the beneficiary's perspective, such
discomfort is no less a concern. In both cases, the discomfort is based
on receiving services from an entity that does not share the
beneficiary's religious beliefs. No interpretation of the Free Exercise
Clause or RFRA requires that a beneficiary's objection to a provider's
religious character should have greater salience than a beneficiary's
objections to a provider's non-religious character. Furthermore, many
citizens routinely accept burdensome conditions so that the Government
can protect others' First Amendment rights. Although the Agencies want
all beneficiaries to be comfortable, they do not believe potential
discomfort over the identity of a provider is of sufficient magnitude
to warrant blanket application of the alternative provider referral
requirement. And with no right to referral, there is also no right to
notice of a referral right.
It is also not clear to what extent the referral requirement
actually reduced the discomfort an objecting beneficiary might feel. To
obtain a referral, the objecting beneficiary (if indeed there were any)
had to disclose the objection to someone affiliated with the same
religious organization the beneficiary considered objectionable.
Moreover, in order for the provider to successfully refer the
beneficiary to a provider to which the beneficiary had no objection,
the objecting beneficiary likely needed to inform the objectionable
organization of the nature of the objection and the scope of the needed
services. Commenters provided the example of an unmarried pregnant
woman who might not seek services from a religious provider that
disapproves of sexual relations outside of marriage. Under the 2016
final rule, this provider could not have provided an appropriate
referral unless the beneficiary disclosed that she was seeking
pregnancy services and needed a referral to another provider that did
not disapprove of women having children outside of marriage. It is not
clear that a beneficiary would feel more comfortable making such a
disclosure than receiving the service from the religious provider or
finding an alternative provider through independent means.
There is an even greater disconnect reflected in one commenter's
claim that the referral requirement was warranted to protect
beneficiaries who encountered ``impractical or inconvenient services.''
Those objections have nothing to do with the religious character of the
provider, and they apply equally to nonreligious providers, which have
never had a referral obligation towards people who found their services
impractical or inconvenient. The referral requirement simply was not
designed to address those kinds of objections.
The Agencies disagree that the alternative provider notice-and-
referral requirements were necessary to warn beneficiaries that the
religious provider might be exempt from Federal regulations and to
enable the beneficiary to seek services from another provider that
adhered to all Federal regulations. The Federal regulations themselves
provided no such notice and did not reference exemptions from Federal
program requirements. Indeed, the 2016 final rule explicitly rejected
calls to include information on ``any services or information that the
provider refuses to provide due to religious or moral objections.'' 81
FR 19363; see also id. at 19365. If anything, such notice could have
been misleading because it would have listed requirements without
indicating any possibility of exceptions, even though faith-based
organizations could have sought accommodations from those requirements
under the First Amendment, RFRA, and Uniform Administrative
Requirements, Cost Principles, and Audit Requirements that all the
Agencies have adopted. See 2 CFR 200.102 (Office of Management and
Budget (``OMB'') guidance permitting the issuance of exceptions from
grant requirements); see also, e.g., 2 CFR 2800.101 (DOJ). If it is
appropriate for an exempt organization to provide notice and referrals,
that requirement can be attached to an exemption, offering a more
tailored solution that does not require all faith-based providers--
including those that adhere to all Federal regulations--to give notice
and referrals to all beneficiaries.
The Agencies also do not believe it generally appropriate to
require notice or referrals merely because a beneficiary might disagree
with the religious beliefs of the service provider or its affiliates.
Under such a rule, a beneficiary could object, for example, to
receiving services from nuns--providing purely secular services and
taking no position on the objectionable issues--solely because those
nuns were affiliated with a church that took positions to which the
beneficiary objected. Beneficiaries are free to reject services from a
provider because of that objection, but they do not have a right to
demand that the provider assist in finding an alternative provider.
For all of these reasons, the Agencies reach different conclusions
about the alternative provider notice-and-referral requirement than
they did in 2016. Their experiences with the 2016 final rule, their
desire to avoid legal concerns over the alternative provider notice-
and-referral requirement created by recent Supreme Court cases, see
Part II.C.2, and their skepticism about the wisdom of imposing
categorical requirements in this area all factor into this decision.
Removing the alternative provider notice-and-referral requirements is
the appropriate legal and policy choice.
Changes: None.
Affected Regulations: None.
b. Other Notices
Summary of Comments: Several commenters also addressed the other
notices, namely, notice of the prohibition on certain religion-based
discrimination, of the restrictions on explicitly religious activity,
and of the opportunity to report violations of these provisions.
Several commenters argued that these other notices should not be
removed because they were necessary to make beneficiaries, especially
vulnerable beneficiaries, aware of their rights and able to exercise or
seek enforcement of those rights. Commenters said that such notices
were part of beneficiaries' underlying rights to be free from
discrimination based on religion and to receive services separate from
explicitly religious activities. Some of these commenters also argued
that nothing had changed since the Agencies' determination in 2016, 81
FR 19365, that beneficiaries needed notice of these other ``valuable
protections.''
Regarding the need for the other notices, commenters disagreed
about whether faith-based organizations were as likely as other
organizations to follow the law. Some commenters agreed with the
Agencies that such notices imposed unjustified additional
administrative burdens that singled out faith-based providers. These
commenters agreed with the explanation--in the NPRMs of DOJ, DOL, HHS,
HUD, ED, VA, and DHS--that beneficiaries do not need ``prophylactic
protections that create administrative burdens on faith-based providers
and that are not imposed on other providers.'' 85 FR 2891 (DHS), 2924
(DOJ), 2932 (DOL), 2941 (VA), 2977 (HHS) 3195 (ED), 8219 (HUD). Other
commenters argued, however,
[[Page 82050]]
that this rationale did not support the wholesale repeal of the other
notice requirements. One commenter claimed that these notices were
valuable to reassure qualified beneficiaries that the religious
organization would follow the law. The commenter provided the
hypothetical example of qualified beneficiaries who had had negative
encounters with religious organizations and who would be inclined to
refuse services from a faith-based organization but might overcome that
reluctance due to the assurances in the notice.
Several commenters also charged that the Agencies had conceded the
importance of these other notices by proposing to provide notices to
faith-based organizations of their eligibility to seek and receive
Federal funds. They said that beneficiaries should receive the same
courtesy as potential applicants. Similarly, one commenter argued that
Federal agencies had recognized the importance of notices in
implementation of civil rights laws, pointing to HHS regulations
regarding notice in 45 CFR 80.6(d), which have remained unchanged since
their issuance in 1964 and are accompanied by model notice documents on
the HHS website.
Response: The Agencies understand that illegal discrimination can
be harmful to beneficiaries and can result in their forgoing services.
The Agencies are committed to fighting illegal discrimination and
ensuring that all beneficiaries have equitable access to the benefits
provided by the federally funded programs and services governed by this
final rule. This final rule reaffirms each Agency's regulatory
provisions prohibiting providers--faith-based or secular, recipients of
direct or indirect aid--from discriminating against beneficiaries based
on religion. Additionally, for direct aid programs, this final rule
retains the provisions prohibiting use of funds for explicitly
religious activity and requiring any beneficiary's participation in
explicitly religious activity to be voluntary.
The Agencies do not agree, however, that the other notices were
vital to make beneficiaries aware of, and able to protect or seek
enforcement of, these protections. No law mandates that beneficiaries
receive such notice, and none was cited by the 2010 Advisory Council
Report, the 2016 final rule, or the commenters on these proposed rules.
As discussed in Part II.C.3.c, the Agencies believe the substantive
provisions are adequate to protect beneficiaries' rights.
The Agencies also disagree that it is justified to require only
faith-based organizations receiving direct Federal financial assistance
to provide notice of the other protections. Any provider--faith-based
or secular--is capable of discriminating on the basis of religion or of
incorporating religious elements into its programs, such as the 12-step
addiction recovery program that commenters cited as explicitly
religious and that is discussed in Part II.C.2.b. (Many government-
issued manuals promote 12-step programs, and many secular organizations
conduct them as well.) Yet none of the secular providers were required
to provide notices of these other protections. None of USAID's program
participants--faith-based or secular--was required to provide such
notices under the 2016 rule. And no provider in USDA's Child Nutrition
Programs, including its school lunch program, was required to provide
such notices.\10\ The Agencies thus have already recognized that many
beneficiaries do not need the other notices, in order to be aware of,
and able to exercise, their corresponding rights.
---------------------------------------------------------------------------
\10\ The 2016 rule deemed the Child Nutrition programs indirect
aid for purposes of exempting them from the notice (and referral)
requirements, even though these programs otherwise meet the
definition of ``direct Federal financial assistance.'' 81 FR at
19381; see also id. at 19413-14 (Sec. 16.4(a), (g), (h)).
---------------------------------------------------------------------------
The Agencies furthermore disagree that the other notice
requirements can be justified as a measure to allay the fears of
beneficiaries who might have had bad experiences with religious
organizations. Beneficiaries might have had similar bad experiences
with secular providers. Because the other notice requirements applied
solely to religious organizations, they stigmatized religious
organizations and risked stoking unnecessary fears by suggesting that
religious organizations were more prone to violate program obligations
that apply to all providers. A beneficiary who received the notices
from a faith-based provider but not a secular provider of similar
services might assume that the former was a serial violator, or that
the latter was not subject, for example, to the nondiscrimination
obligations. Additionally, research cited by some commenters found that
people with an expectation of rejection or discrimination would feel
that way ``whatever others profess'' to the contrary.\11\ That research
undermines the supposition that a form notice required by the
Government would meaningfully allay beneficiaries' fears that they
would be subject to discrimination.
---------------------------------------------------------------------------
\11\ Ilan H. Meyer, Prejudice, Social Stress, and Mental Health
in Lesbian, Gay, and Bisexual Populations: Conceptual Issues and
Research Evidence, 129(5) Psychol. Bull. 674, (Sept. 2003), https://www.ncbi.nlm.nih.gov/pmc/articles/PMC2072932/.
---------------------------------------------------------------------------
Similarly, notice requirements that apply to other programs do not
demonstrate that the Agencies should retain the notice requirement from
the 2016 final rule. Commenters pointed to the notice in the HHS
regulation at 45 CFR 80.6(d). That provision mandates that ``[e]ach
recipient'' of funding ``shall make available to participants,
beneficiaries, and other interested persons'' information regarding
regulations effectuating Title VI of the Civil Rights Act of 1964 that
bar discrimination based on race, color, or national origin. 45 CFR
80.1, 80.2, 80.3, 80.6(d). The HHS notice applies comprehensively to
all recipients and was designed to help eradicate racial discrimination
by any provider. This stands in contrast to the notice requirement from
the 2016 final rule, which compelled only faith-based organizations to
provide notice of certain beneficiary protections without evidence that
faith-based organizations violated those protections more regularly
than other providers, if at all. This final rule is meant to enable
faith-based organizations to participate equally in the Agencies'
federally funded programs. Removing the notice requirement takes one
step toward achieving that purpose. This analysis is further bolstered
by HHS's response in Part III.I regarding the distinctions between this
final rule and HHS's recent final rule, Protecting Statutory Conscience
Rights in Health Care, 84 FR 23170 (May 21, 2019).
Ultimately, the justification for imposing these notice
requirements solely on faith-based providers participating in certain
direct aid programs was prophylactic, perhaps based on the assumption
that these providers were less likely to follow the law. But there is
no basis on which to presume that faith-based providers are less likely
than other providers to comply with their legal obligations. And any
narrative to the contrary smacks of the now-repudiated Establishment
Clause doctrine stating that ``pervasively sectarian'' institutions
could not receive government funds, even for secular purposes, because
they could not be trusted to prevent the diversion of government funds
to religious uses. Cf. Agostini v. Felton, 521 U.S. 203, 224 (1997)
(noting the Supreme Court's rejection of the idea that ``solely because
of her presence on private school property, a public employee will be
presumed to inculcate religion in the students''). Because, among other
things, the Agencies now recognize that any such prophylactic concerns
were
[[Page 82051]]
exaggerated as well as selectively applied, the Agencies are changing
the 2016 final rule.
As discussed in Part II.G.3, the Agencies will provide notice to
potential applicants and awardees of their obligations under federally
funded social service programs, including notice of the prohibitions on
religion-based discrimination and explicitly religious activities.
Those notices will ensure that the underlying requirements are
incorporated into organizations' applications and compliance programs.
Those notices are also consistent with Trinity Lutheran and RFRA, and
they ensure that organizations are aware of their obligations under
law--and of the Agencies' commitment to enforcement of these
obligations--before applying for and accepting an award. Requiring
these notices to faith-based providers does not conflict with removing
the requirement to provide the other notices to beneficiaries. This
final rule requires the Agencies and intermediaries to integrate such
notices to faith-based organizations into the comprehensive program
requirement materials already distributed to providers. This practice
is materially different--for reasons discussed throughout Parts II.C
and II.G.3--from requiring only faith-based providers to give the other
notices to beneficiaries, especially notices that stigmatized faith-
based providers by implying that they were more likely than their
secular peers to violate the law. Additionally, beneficiaries who
received the other notices would already have been communicating with
the faith-based provider, and they could have asked the provider
questions to ensure their eligibility and understand the scope of
available benefits. The other notices thus provided little marginal
utility to beneficiaries. Rather, notices to providers are a more
appropriate way to achieve compliance with legal obligations,
consistent with the constitutional and other concerns discussed
throughout Part II.C that the Agencies are seeking to avoid.
Changes: None.
Affected Regulations: None.
2. Beneficiary Harms
a. In General
Summary of Comments: Several commenters claimed that removing all
of the notice requirements, as well as the referral requirement, would
cause various harms, burdens, and costs to beneficiaries. Some said
that beneficiaries would no longer be aware of, and able to avail
themselves of, the underlying religious liberty protections. Many
claimed that removing the notice requirements would especially affect
groups that commenters characterized as disadvantaged, including women,
religious minorities, people of color, LGBTQ people, people with lower
incomes, people with disabilities, and people in rural communities.
Additionally, some commenters argued that the Agencies had not
attempted to quantify the costs to beneficiaries associated with
removal of these requirements.
Several commenters were concerned that removing the all of the
notice requirements and the referral requirement would expose
beneficiaries to increased religious discrimination, denial of
services, proselytization, bias, or coercion. Several commenters,
including advocacy organizations and Members of Congress, anticipated
that these harms would increase because beneficiaries would no longer
be aware of, and able to safeguard, their rights. Some commenters added
concerns that beneficiaries might be more vulnerable to efforts to
coerce them to participate in religious activities if they mistakenly
believed such activities were necessary to access support. Other
commenters were concerned about impacts on vulnerable groups, such as
women, adherents of minority faiths, and LGBTQ people. And some local
governments claimed that certain faith-based providers openly
discriminate on the basis of gender identity or sexual orientation.
Some commenters argued that the Agencies had not adequately
examined whether removing the notice would increase discrimination.
They said the Agencies needed to provide evidence of other reliable,
systematic ways to notify beneficiaries of these protections. Without
such efforts, commenters claimed, these vulnerable beneficiaries--
including refugees, human trafficking victims, and homeless youth--
would be cut off from the one guaranteed way to ensure they know about
these key protections.
Multiple commenters claimed that removing the alternative provider
notice-and-referral requirements would harm beneficiaries by requiring
them to take on the burden of identifying alternatives. These
commenters noted that DOJ, DOL, HHS, HUD, VA, DHS, and USDA had
acknowledged in their NPRMs that there could be a cost to objecting
beneficiaries from having to locate alternative providers on their own.
85 FR 2894 (DHS), 2903 (USDA), 2926 (DOJ), 2935 (DOL), 2944 (VA), 2983
(HHS), 8221 (HUD). Commenters argued that beneficiaries would
``potentially'' have to miss work, find childcare, pay for
transportation, and visit various other organizations to find
alternative options, which would be ``extremely taxing'' or
``insensitive'' to the people the organizations are meant to support.
And some commenters were concerned that objecting beneficiaries might
not be aware that alternative services exist or be able to identify
those alternatives.
Some commenters argued that the Agencies did not explain why low-
income program participants would be better positioned than provider
grantees to identify alternatives. These commenters argued that the
Agencies' proposals to remove the alternative provider notice-and-
referral requirements were inconsistent with their determination in the
2016 final rule that faith-based providers would ``generally be in the
best position to identify alternative providers in reasonable
geographic proximity and to make a successful referral of objecting
beneficiaries to those alternative providers.'' 81 FR 19366.
Additionally, some commenters disagreed with placing the burdens of
investigation on vulnerable beneficiaries, arguing that vulnerable
beneficiaries were less likely to understand their rights than faith-
based organizations were to understand their rights to seek and receive
Federal funding.
Some commenters argued that the Agencies could not assume that any
faith-based providers would make referrals if the requirements were
removed. The Council Chair suggested that such an assumption is
comparable to the assumption that the religious freedom of faith-based
organizations would be protected. Two umbrella groups of faith-based
organizations who otherwise opposed removal of the referral requirement
commented that group members were ``willing and able'' to provide
referrals upon request; others believed they had a ``moral obligation''
to make referrals to alternative providers upon request.
Some commenters argued that, even if referrals were rare, the
alternative provider notice-and-referral requirements should still be
maintained to prevent harm to objecting beneficiaries. They argued that
placing a burden on even one beneficiary would be significant.
One comment asserted that beneficiaries who have objected to faith-
based providers in specific circumstances have sought referrals to
alternative providers from organizations that share the beneficiaries'
values rather than from the objected-to providers. As relevant here,
the comment posited that beneficiaries may be less likely to seek
alternatives--even
[[Page 82052]]
from these sources outside the prescribed process--if the alternative
provider notice-and-referral requirements were eliminated. The comment
also suggested that religious people might desire referrals to like-
minded organizations but lack the resources to find them. As a result,
they might be forced to endure violations of their religious freedoms
or forgo essential social services.
Several commenters were concerned that, without the notice-and-
referral requirements, beneficiaries would be forced to compromise
their religious rights and identities. Some described this as a choice
between accepting objectionable services and forgoing benefits. Others
described it as a choice between accessing needed services and
retaining religious freedom protections. Two umbrella groups of faith-
based organizations expressed concern that members of minority
religions seeking services from federally funded faith-based
organizations of other religions could have their critical safety net
benefits effectively conditioned on religious beliefs. Some of these
commenters provided examples; one noted that veterans may be ``forced''
to accept ministry services from a religious group that they
``revile.'' Other examples are outlined in detail in the discussion of
the comments in Part II.C.2.b and include harms to beneficiaries
seeking opioid use disorder treatment, domestic violence shelters, and
veteran job training services.
Some commenters claimed that beneficiaries would be blindsided by
the provider's religious character in the absence of notice that the
provider was religious, religiously affiliated, or promoted religious
values, which would violate the constitutional principle that American
government must remain secular. Another commenter suggested, however,
that notice was not necessary because beneficiaries often know about a
provider's religious character from the organization's title and can
pursue a secular provider if they are uncomfortable with the provider's
religious character.
Numerous commenters were concerned that beneficiaries, especially
vulnerable beneficiaries, would lose access to benefits or forgo
services without the benefits of notice and referral; some
characterized the lack of notice and referral as a potentially
insurmountable hurdle to beneficiaries' obtaining the help they need.
They claimed that this would constitute a follow-on effect from all of
the other harms discussed above, especially increased discrimination,
lack of notice that discrimination based on religion is prohibited,
absence of referrals, difficulty identifying alternatives, and lack of
notice regarding alternatives and referrals. Some commenters were
concerned that removing notice of the prohibition on discrimination
would prevent beneficiaries afraid of such discrimination from seeking
needed services. Other commenters were particularly concerned that
shifting the burden of investigating alternatives onto beneficiaries
with limited resources would leave them with no services or no ability
to access services. One of these commenters claimed that ``millions of
Americans'' might forgo vital services if they were unable to locate
alternative providers. Multiple commenters emphasized that these
protections were being denied to some of society's most vulnerable and
marginalized, who have no choice but to use government-funded social
services and may find it harder without the notice and referral to get
the services they need. Some commenters characterized the Agencies'
proposals to remove the requirements as ``unconscionable and
unethical,'' ``indefensible,'' and ``hurtful and discriminatory.''
Commenters also argued that removing the notice-and-referral
requirements would undermine the goals of reducing poverty, empowering
low-income populations, and providing services to all who need them in
the most effective and efficient manner possible, as articulated in
existing Federal laws, regulations, and Executive Orders, including
Executive Order 13279.
Some commenters focused on the final rule's combined effect of
removing the notice requirement, removing the referral requirement, and
allowing for religious accommodations. They were concerned that such
changes would permit or increase the risk of discrimination or denial
of service based on beneficiaries' protected statuses, such as sex,
sexual orientation, gender identity, religion, and race. Some
commenters said that this rule would roll back Federal protections
against religious discrimination and thereby embolden, rather than
deter, such discrimination. A few commenters were concerned that these
changes would increase the need for referral, such as if a faith-based
provider denied services to an eligible beneficiary, at the same time
that these changes made referrals optional and, therefore, less likely
to occur. Some argued that there would be increased costs to State
regulatory agencies from an increase in complaints alleging
discrimination in the provision of social services and medical care.
That comment also referenced State nondiscrimination laws.
Similarly, other commenters claimed that the notice-and-referral
requirements were even more critical because the Agencies proposed to
expand religious exemptions and alter the requirements for faith-based
recipients of indirect aid.
Response: For the reasons that follow, the Agencies disagree with
the view that removal of the notice-and-referral requirements will
cause the harms alleged, including discrimination, proselytization,
bias, and coercion; burdens of investigating alternatives; choice
between protecting religious liberties and accepting services; forgoing
services altogether; and difficulty reporting violations of the
provisions regarding discrimination and explicitly religious
activities.
First, the public comments do not point to a single actual instance
of past harm or negative consequence--with no evidence to support
claims of discrimination, proselytizing, bias, coercion, or other
harm--that occurred in these programs before the introduction of the
alternative provider notice-and-referral requirements in 2016 and
attributable to the absence of those requirements. That is addressed in
greater detail in Part II.C.2.b. Indeed, the prohibition on explicitly
(or inherently) religious activities in directly funded social service
programs has existed in some form since Executive Order 13279 was
issued in 2002, and commenters did not point to any actual harms from
beneficiaries' lack of notice for the 14 years from 2002 through the
issuance of the 2016 final rule.
Additionally, the notice-and-referral requirements never applied to
any USAID program or to USDA's Child Nutrition Programs, including the
school lunch program, which USDA deemed indirect aid for purposes of
exempting them from those requirements. 81 FR 19381, 19384-85. Yet
numerous comments catalogued hypothetical harms to beneficiaries that
would occur if the notice or referral requirements were removed from
USAID's programs and USDA's school lunch program. No comment to USAID
or USDA cited an instance of actual harm that occurred over the past
four years in the absence of these requirements in USAID or USDA
programs. Despite their failure to point to concrete examples of harm,
some of the same commenters still presented the same parade of
horribles that would befall beneficiaries if the Agencies eliminated
their nonexistent notice-and-referral requirements. The Agencies do not
find this speculation persuasive.
[[Page 82053]]
Second, the Agencies believe that removing the notice-and-referral
requirements will cause negligible, if any, risk of harm. Secular
organizations use Federal funds to provide social services to the same
needy and vulnerable beneficiaries as their faith-based counterparts,
beneficiaries who are just as likely to be unaware of their rights or
afraid of discrimination. Commenters do not claim any harm, however,
from the absence of notice and referral by secular providers. The
Agencies correctly determined in 2016 that secular organizations did
not need to provide these notices in order to protect beneficiaries
from any serious risk of harm. Now, they extend that same determination
to faith-based organizations. Beneficiaries in all programs will be
equally well aware of their rights and equally well positioned to
protect and safeguard those rights, including by reporting any
violations.
Third, the allegations that removing the referral requirement will
harm beneficiaries are undermined by the Agencies' experience;
referrals were rarely, if ever, sought under the prior rule. In fact,
the Agencies are not aware of any actual instance of a request for a
referral under the 2016 final rule or under SAMHSA programs, as
discussed in Part II.C.3.c, and commenters did not cite any instance of
a beneficiary who had sought such a referral. Removing the referral
requirement also does not mean that a provider will refuse to make a
referral if a beneficiary requests one. Service providers remain free
to continue to make voluntary referrals to other providers. Indeed,
some faith-based providers said they were willing and able to provide
alternative-provider referrals, including one comment with over 7,000
signatures professing a ``moral obligation'' to do so. Other publicly
available resources and mechanisms for referral also exist, including
like-minded organizations, locators, and hotlines. These resources and
mechanisms are discussed in the following paragraphs.
Fourth, the Agencies disagree that beneficiaries face any serious
risk of harm from the process of finding alternatives themselves--
either from any search costs or from choosing to forgo services
completely. No evidence supports the speculative assertion that
beneficiaries would need to miss work, obtain childcare, pay
transportation costs, or visit various organizations in-person to find
an alternative provider. Beneficiaries can learn about alternative
providers from numerous sources, including through the internet or
telephone, providers' marketing, and government outreach programs. The
Agencies, State and local governments, advocacy groups, and service
providers offer hotlines and online locators for many of these
services; these tools can be found quickly with rudimentary online
searches. The Agencies' websites provide easy means to locate
providers, including providers of the services listed in the
commenters' hypothetical examples (some of which may not be subject to
this final rule): Opioid use disorder treatment (https://findtreatment.samhsa.gov/), domestic violence shelters, (https://www.justice.gov/ovw/local-resources), and veteran job-training services
(https://www.dol.gov/veterans/ findajob/). See also https://www.hud.gov/findshelter (homeless assistance and shelter locator);
https://www.acf.hhs.gov/otip/victim-assistance/national-human-trafficking-hotline (human trafficking hotline and referral directory).
The Agencies also provide broader resources for beneficiaries and
potential beneficiaries, including resources available on their main
websites. For example, DOL's main website, https://www.dol.gov, has
easy-to-find links to a wide variety of programs, a toll-free contact
line at 866-4-USA-DOL (866-487-2365), and a general contact page at
https://www.dol.gov/general/contact.
As ED explained in its NPRM: ``Beneficiaries need not rely on
providers for information about other secular or faith-based
organizations that provide social services. Beneficiaries are consumers
of public information and are capable of researching available
providers and making informed decisions about whether to choose to
receive social services from secular or faith-based organizations.'' 85
FR 3194. Providers and advocacy groups create numerous materials that
contain information regarding alternative providers. One commenter
submitted an attachment authored by Justice in Aging that listed
organizations willing to provide referrals to local advocates for
individuals who may face bias or discrimination in a nursing home or
assisted living facility.\12\
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\12\ Justice in Aging, LGBT Older Adults in Long-Term Care
Facilities: Stories from the Field 28 (updated June 2015),
www.justiceinaging.org.customers.tigertech.net/wp-content/uploads/2015/06/Stories-from-the-Field.pdf.
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The Agencies thus no longer believe, as they did in 2016, that
faith-based providers are ``generally . . . in the best position to
identify alternative providers in reasonable geographic proximity and
to make a successful referral of objecting beneficiaries to those
alternative providers.'' 81 FR 19366. That position is not consistent
with the Agencies' experience, which reveals that beneficiaries rarely
invoke the referral requirement and that the resources to locate
alternatives are readily available to beneficiaries. Additionally,
beneficiaries know the scope of their needs and the sorts of
organizations from which they may object to receiving services.
Consequently, they will often be in the best position to find a
suitable provider.
Fifth, the Agencies disagree that they need to conduct further
analysis to better understand the costs to beneficiaries to
independently locate acceptable alternative providers. It is difficult
to quantify these potential costs with any precision, but the
information the Agencies have available suggests that any costs would
be minimal and no greater than any parallel costs already borne by
beneficiaries of program providers that are not required to provide
referrals. Additionally, the Agencies invited commenters to provide
data and suggest further ways to assess any ``potential cost'' of the
change, see 85 FR 2894 (DHS), 2935 (DOL), 2944 (VA); see also 2903
(USDA), 2926 (DOJ), 2983-84 (HHS). None of the over 95,000 comments
received by the Agencies provided any data or insights on assessment
methodologies that would meaningfully supplement the information the
Agencies already have or demonstrate that costs would be more than
minimal. The issue of costs and benefits is addressed in more detail in
Part II.K.1.
Sixth, the Agencies disagree that, without the notice requirement,
beneficiaries will be blindsided by the religious nature of the
Government-funded services they may receive from program providers. In
2016 as today, all federally funded services offered by the programs
must be secular. Beneficiaries do not need a warning of the religious
nature of federally funded services when religious federally funded
services are specifically prohibited.
Seventh, the Agencies disagree that removing the requirement of the
notices (regarding nondiscrimination rights and the like) would inhibit
beneficiaries from reporting violations. As discussed, there is no
indication that beneficiaries need notice of how to report violations
of these rights. In fact, as discussed, beneficiaries have not received
such notice from many other providers. Rather than relying on
beneficiaries to safeguard their own rights, the Agencies prefer to put
the onus on the providers, by giving them express notice of their
obligations and making clear that the Agencies will enforce those
obligations.
[[Page 82054]]
Eighth, the Agencies disagree that the referral requirement should
be retained because the need for referrals will increase due to
provisions in this final rule that allow for certain accommodations to
faith-based organizations. Any request for an accommodation will be
assessed based on a context-specific analysis that will balance all of
the relevant considerations, including whether the particular provider
receiving the accommodation will be required to provide notice and
referrals. For example, if a Sabbath-observant food pantry sought an
accommodation to participate in a food pantry program while remaining
closed on its Sabbath, the Agency would consider--as part of its
inquiry into the burden on the food pantry weighed against the
Government's justification and ability to accomplish its goals through
means less restrictive of religious exercise--whether the pantry should
give notice of this practice and should make referrals to ensure that
beneficiaries can receive services on the pantry's Sabbath. The
Agencies believe this case-by-case approach will better serve both
providers and beneficiaries.
Finally, the Agencies understand that invidious discrimination can
be harmful to beneficiaries and can result in their forgoing services.
The Agencies are committed to fighting such illegal discrimination and
ensuring that all beneficiaries have equitable access to benefits from
the federally funded programs and services governed by this final rule.
This final rule reaffirms each Agency's rule prohibiting providers from
discriminating against beneficiaries based on religion.
However, the Agencies disagree that eliminating the notice
requirements as well as the referral requirement threatens to increase
discrimination based on sex, sexual orientation, gender identity, and
race. This final rule does not roll back any such existing protections
or allow faith-based organizations receiving direct aid to condition
the receipt of benefits on acceptance of their religious beliefs.
Moreover, other laws will continue to dictate the balance between
providers' rights and beneficiaries' rights, including the right to be
free from discrimination on the basis of sex.\13\ For example, in
USDA's program to fund facilities for public use, regulations prohibit
grant recipients from discriminating against beneficiaries on several
grounds, including on the basis of sex. See, e.g., 7 CFR 1942.17(e),
3570.61(f), 3575.20(e).
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\13\ See, e.g., Bostock v. Clayton Cty., 140 S. Ct. 1731, 1753-
54 (2020) (acknowledging the potential applications of the ``express
statutory exception for religious organizations'' in Title VII; of
the First Amendment, which ``can bar the application of employment
discrimination laws'' in certain cases; and of RFRA, ``a kind of
super statute,'' which ``might supersede Title VII's commands in
appropriate cases,'' and noting that ``how these doctrines
protecting religious liberty interact with Title VII are questions
for future cases too''); Masterpiece Cakeshop, Ltd. v. Colo. Civil
Rights Comm'n, 138 S. Ct. 1719, 1732 (2018) (recognizing that many
such disputes ``await further elaboration in the courts'').
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The prior rule did not touch on those issues at all. It did not
require informing beneficiaries that they could not be subject to
discrimination based on sex, nationality, or any other protected
classification. If anything, singling out religious discrimination in
the notice could have implied that beneficiaries would not receive
protection from other forms of discrimination. This final rule will
touch on such issues only when a provider seeks a religious
accommodation under the First Amendment or RFRA, in which case the
Agencies will carefully review and balance the competing claims and
apply relevant law, as discussed in Parts II.C.2, II.E, and II.F. This
is the appropriate legal and policy choice to ensure that these rights
are appropriately balanced and that religious liberty protections are
not swept away by categorical rules. The Agencies have no reason to
believe the notice requirements are necessary to promote the goals of
reducing poverty, empowering low-income populations, and providing
services to all who need them.
Changes: None.
Affected Regulations: None.
b. Specific Examples, Studies, and Hypotheticals
Summary of Comments: Commenters offered a number of examples in an
effort to show the harms discussed in Part II.C.2.a, based on court
cases, surveys, studies, and personal experiences--either by the
commenter or reported directly to the commenter. Although most of the
examples cited by commenters were hypothetical, some relied on actual
instances or studies. The most significant actual instances were
provided in a comment by a national legal organization that represents
LGBTQ people in litigation, policy advocacy, and public education. It
cited actual instances of LGBTQ people experiencing discrimination or
denial of service when ``accessing services of the sort provided by
federally funded social service programs.'' It cited one of its
transgender clients who was scheduled for a hysterectomy at a religious
hospital but had the procedure cancelled due to the hospital's
religious objection. It also described actual instances of
beneficiaries feeling uncomfortable receiving services from faith-based
organizations. Many of this commenter's examples involved religious
individuals with no indication that they were affiliated with any
faith-based organizations, much less a faith-based organization
receiving Federal funding. This commenter's examples, amicus briefs,
and studies also cited comparable examples of discrimination by secular
organizations, without indicating which secular organizations may have
received Federal funding.
Another commenter cited court cases involving concrete examples of
discrimination or denial of service that transgender people have faced
in programs that offer alternatives to incarceration, such as
probation. The commenter cited an example where, as part of a guilty
plea, a transgender person was placed in a residential substance abuse
treatment program; the person believed they were placed with the wrong
sex and were ultimately transferred out of the program. As a result,
this person failed to meet the terms of the plea agreement and was
sentenced to another two and a half years in prison. See Wilson v.
Phoenix House, No. 10-cv-7364, 2011 WL 3273179 (S.D.N.Y. Aug. 1, 2011);
Wilson v. Phoenix House, 978 N.Y.S.2d 748 (Sup. Ct. 2013). The
commenter also cited the case of a person who was denied eligibility by
a halfway house in 2010 due to transgender status. Kaeo-Tomaselli v.
Butts, No. 11-cv-00670, 2012 WL 5996436 (D. Haw. Nov. 30, 2012).
Without citation, another commenter claimed actual instances of
transgender people being sent back to prison when re-entry programs
refused to serve them.
Some commenters cited surveys and studies chronicling actual
instances of discrimination against specific vulnerable groups. Several
commenters relied on a 2015 survey of transgender people in the United
States, conducted by the National Center for Transgender Equality.\14\
Commenters relied on this 2015 survey's examples of actual claimed
instances of transgender people being misgendered intentionally, made
to feel unsafe, and made to forgo further medical care. Commenters
added that one transgender person who had been sexually assaulted
reported in the 2015
[[Page 82055]]
survey that their case was not investigated; they were denied a rape
kit; and authorities, including a university, threatened them with
punishment for reporting the assault, which caused them to live in
fear. Commenters highlighted that some of the survey respondents stated
that they were admonished that they deserved to be raped or should
return to their birth gender to receive services. One commenter also
noted the 2015 survey's finding that, of transgender people who had
visited a public assistance or government benefits office in the past
year, 11 percent reported being denied equal treatment or service and 9
percent reported being verbally harassed.
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\14\ Sandy E. James, et al., National Center for Transgender
Equality, The Report of the 2015 U.S. Transgender Survey (Dec.
2016), https://transequality.org/sites/default/files/docs/usts/USTS-Full-Report-Dec17.pdf.
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One commenter also provided specific reports that it collected of
medical errors and misdiagnoses due to transgender status,
transgendered people being turned away by doctors who claimed religious
reasons, or being treated in a ``hateful'' way that included
embarrassing the person in front of others due to transgender status.
The commenter relayed other reports of medical mistreatment, including
medical examinations halted in the middle when transgender status was
revealed and hospitals placing transgender people in isolation. The
commenter also described an older transgender adult who reported to a
social worker having experienced sexual abuse and verbal harassment
from nurse aides but did not want to report the incidents out of fear
of retaliation and disclosure of transgender status to the patient's
family.
Some commenters cited surveys and studies indicating that
experience with discrimination leads to other harms. One commenter said
that HHS had identified discrimination against beneficiaries as harmful
to the health of vulnerable populations, citing a study entitled
Healthy People 2020.\15\ Others applied this general point to the LGBTQ
community, noting that LGBTQ people report being or feeling unwelcome
at social service providers, being subjected to discrimination, and
forgoing care and services as a result. One of these comments pointed
to a Center for American Progress national survey of LGBTQ adults
published in 2017 that found 17 percent of respondents who had
experienced anti-LGBTQ discrimination in the past year reported
avoiding getting services that they or their family needed out of fear
of facing further discrimination.\16\ By removing the requirement that
providers take reasonable steps to refer beneficiaries to alternative
providers, the commenters argued, this final rule would expose many
LGBTQ people who use human services programs to discrimination and
apprehension of discrimination, which will in turn lead to many
forgoing care and services for which they are qualified. Other
commenters made the similar point--based on experience rather than
studies--that the LGBTQ community has faced a history of
discrimination, denial of service, harassment, and pressure to
compromise their authentic selves in order to receive equal access to
social programs. Without a proactive referral requirement, they argued,
this community would rely on its past experience to inform the
relationship with service providers.
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\15\ Office of Disease Prevention and Health Promotion, Healthy
People 2020 (last updated Oct. 8, 2020), https://www.healthypeople.gov/2020/topics-objectives/topic/social-determinants-health/interventions-resources/discrimination.
\16\ Sejal Singh and Laura E. Durso, Center for American
Progress, Widespread Discrimination Continues to Shape LGBT People's
Lives in Both Subtle and Significant Ways (May 2, 2017), https://www.americanprogress.org/issues/lgbtq-rights/news/2017/05/02/429529/widespread-discrimination-continues-shape-lgbt-peoples-lives-subtle-significant-ways/.
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Some of these commenters cited studies showing people had negative
experiences in certain sectors or with certain categories of service
providers. A commenter cited a then-unpublished 2019 American Atheists
national survey of 34,000 nonreligious individuals, many of whom
reported ``negative experiences'' due to their secular or nonreligious
beliefs within the previous three years: 17.7 percent reported such
negative experiences when receiving mental health services, 15.2
percent in substance abuse services, 10.7 percent in other health
services, 6.2 percent in public benefits, and 4.5 percent in
housing.\17\
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\17\ American Atheists, Reality Check: Being Nonreligious in
America 23-24 & fig.14 (2019), https://static1.squarespace.com/static/5d824da4727dfb5bd9e59d0c/t/5ec6d6d8e8da850b30521353/1590089442015/Reality+Check+-+Being+Nonreligious+in+America.
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Several commenters cited studies showing LGBTQ people had
difficulty finding medical care providers. A commenter pointed to a
2018 Center for American Progress Survey (``2018 CAP Survey'') that, it
asserted, demonstrated the difficulties LGBTQ individuals face in
receiving services, including 17 percent of respondents (and 31 percent
of non-metro respondents) saying it would be ``very difficult'' or
``not possible'' to find the same type of service they were seeking
from a different community health center or clinic at a different
provider.\18\ Another commenter relayed reports of one transgender
person's taking years to find a primary care physician willing to treat
them and another transgender person's residing in a rural and lower-
income area, struggling to attain basic healthcare.
---------------------------------------------------------------------------
\18\ Shabab Ahmed Mirza and Caitlin Rooney, Center for American
Progress, Discrimination Prevents LGBTQ People from Accessing
Healthcare (Jan. 18, 2018), https://www.americanprogress.org/issues/lgbt/news/2018/01/18/445130/discrimination-prevents-lgbtq-people-accessing-health-care/.
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Some commenters cited studies showing certain groups experience
increased negative health outcomes that, these commenters claimed,
would be exacerbated by removing the notice requirements and the
referral requirement while providing for religious accommodations. A
commenter cited studies indicating that LGBTQ individuals have negative
health outcomes that have been termed ``minority stress.'' This
commenter relied on studies indicating that gender-based discrimination
against transgender people, especially in health care settings, is
associated with increased rates of negative health outcomes, including
depression, attempted suicide, and substance use. This commenter then
argued that removing the notice and referral protections (as well as
providing new accommodations) could contribute to significant health
costs based on the direct medical and mental health impacts of
discrimination alone. Similarly, another commenter claimed that older
LGBTQ adults face pronounced health disparities and higher poverty
rates compared to their peers, due in large part to historical and
ongoing discrimination.\19\
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\19\ See Karen Fredriksen-Goldsen et al., The Aging and Health
Report: Disparities and Resilience Among Lesbian, Gay, Bisexual, and
Transgender Older Adults (November 2011), www.lgbtagingcenter.org/resources/resource.cfm?r=419.
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A commenter focused on medical care for Bhutanese Hindu refugees.
This commenter said that people in this group have already suffered
immense trauma from forcible eviction from their home country due to
their culture and religion, and they have experienced particular
difficulty retaining their cultural and religious identity in the
United States. The commenter claimed that removal of the notice-and-
referral requirements would strip this vulnerable group of protections
against discrimination, proselytization, or religious coercion in
government-funded social services. The commenter claimed that Bhutanese
Hindu refugees have a particular need to know their rights fully and to
access health services, including mental health
[[Page 82056]]
services, because their rates of suicide and mental health conditions
are higher than those of the rest of the population. Additionally,
without being informed of their rights, the commenter expressed concern
that these refugees may feel pressured to convert to Christianity or
attend Christian religious services because they incorrectly believe
those actions are required to continue receiving services. The
commenter claimed that these outcomes would risk exacerbating the group
members' already-concerning health trends.
Some of these commenters cited studies indicating that certain
groups are more likely to receive government services, from which the
commenters inferred that these groups are more likely to be harmed by
removal of the notice-and-referral requirements. One commenter cited
the 2018 CAP Survey to demonstrate that LGBTQ people are more likely to
participate in a wide range of public programs. That commenter claimed
this 2018 CAP Survey found that LGBTQ people with disabilities were
especially likely to rely on government benefit programs, such as
Supplemental Nutrition Assistance Program (``SNAP''), Medicaid,
unemployment, and housing assistance. As a result, this commenter
argued that ensuring access to federally funded social services
programs by mandating referrals to alternative providers is vital for
members of this vulnerable population. Another commenter stated that
LGBTQ youth are at a higher risk of homelessness, citing Chapin Hall,
Missed Opportunities: Youth Homelessness in America (2017), which
reported LGBTQ youth at a 120 percent higher risk of homelessness than
other young adults.
Other commenters made similar statistical claims without providing
the basis for their claims. Commenters claimed that 20-40 percent of
homeless youth are ``LGBT-identified'' and that LGBT youth
disproportionately represent 40 percent of the homeless youth
population in New York City. One of these commenters also said that
most homeless families are headed by unmarried women and that these
families are not well situated to absorb the burdens from the changes
in this final rule. Another commenter claimed that people with
disabilities and their families face a national shortage of accessible
and affordable housing, particularly the lowest-income people with
disabilities, and that removing these requirements could impose another
barrier to housing programs for this population, such as Section 811
Supportive Housing for Persons with Disabilities.
One commenter argued that LGBTQ senior citizens have a particular
need for the notice-and-referral requirements to access long-term
services and supports because they do not have traditional support
systems in place and are therefore more likely to rely on personal care
aides or enter care facilities.\20\ This commenter also conducted a
survey that found LGBT older adults experienced discrimination in long-
term care facilities ranging from verbal and physical harassment, to
visiting restrictions and isolation, to denial of basic care such as a
shower or being discharged or refused admission. They also cited
examples of LGBT older adults being ``prayed over'' without their
consent or being told they would go to hell. This commenter attached
its report to the comment.\21\ This commenter was concerned that
eliminating the notice-and-referral requirements would make these types
of discriminatory actions more common and make it harder for victims to
seek recourse.
---------------------------------------------------------------------------
\20\ See SAGE and Movement Advancement Project, Improving the
Lives of LGBT Older Adults (March 2010), https://www.lgbtmap.org/file/improving-the-lives-of-lgbt-older-adults.pdf.
\21\ Justice in Aging, LGBT Older Adults in Long-Term Care
Facilities: Stories from the Field (updated June 2015),
www.justiceinaging.org.customers.tigertech.net/wp-content/uploads/2015/06/Stories-from-the-Field.pdf.
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Additionally, a retired physician commented that she had experience
with end-of-life issues and that patients and families who do not wish
to receive ``futile or heroic treatments'' from religious doctors
should be referred for another opinion.
Numerous commenters provided hypothetical examples of the harms
they claimed would befall beneficiaries following removal of these
notice-and-referral requirements. For example, two commenters to ED
cited their extensive experience representing students in Federal court
cases and administrative cases but claimed only that removing the
notice-and-referral requirements ``would likely make it harder for
beneficiaries to access programs serving marginalized young people,''
without citing any actual instances.
The Council Chair insisted that the alternative-provider referral
requirement was essential. She asked the Agencies to ``imagine'' a
victim of human trafficking who does not speak English, is in an
unfamiliar location, is a single parent, and does not have reliable
internet, yet has to research an alternative provider while working and
caring for young children. This commenter claimed it is ``insufficient
to assume'' that this beneficiary would be given assistance, just as,
the commenter claimed, it is insufficient to assume that the rights of
faith-based organizations would be protected.
Some of these commenters claimed removing the notice-and-referral
requirements would especially harm beneficiaries in medical contexts.
Multiple commenters expressed concern that critical care, including
medical care, would be delayed or denied without a referral upon
request. Commenters argued that removal of the referral requirement
would impede access to medical care for beneficiaries who do not feel
comfortable obtaining care from religious providers in rural areas that
have medical care shortages and that often require farther travel, on
poorer roads, with less access to public transportation than in urban
areas. Commenters also highlighted concerns for children in the foster
care, child welfare, and juvenile justice systems.
Commenters highlighted other social service areas as well, as
outlined in the bullet points below. One commenter argued that
discrimination in access to social services would reduce timely access
to critical social services. It provided the hypothetical example of
discrimination that delays shelter for someone experiencing
homelessness or housing insecurity, which would cause prolonged
homelessness, poor health, victimization, and negative interactions
with law enforcement. The commenter noted that a day in a shelter costs
less than a day in jail or an emergency room visit, citing a study on
the costs of homelessness.
Some of these commenters claimed removing the alternative provider
notice-and-referral requirements would harm beneficiaries from specific
groups, which the commenters identified as vulnerable populations.
Commenters argued that removing referrals would limit access and would
disproportionately affect low-income communities, themselves already
disproportionately made up of women, immigrants and refugees, LGBTQ
people, and people with disabilities. These commenters argued that
access is particularly important for these groups, which benefit from
programs that help increase employment, alleviate poverty, and
alleviate homelessness. According to these commenters, removing the
referral requirement will only increase the likelihood of negative
outcomes for these groups and will perpetuate the cycle that ties
discrimination to an increased likelihood of unemployment and poverty.
Many commenters claimed that removal of the referral requirement
[[Page 82057]]
would particularly burden LGBTQ beneficiaries. Some of these commenters
claimed that referrals are ``vital'' for LGBTQ beneficiaries because
they have unique difficulty obtaining secular or welcoming alternative
service providers. Some of these commenters also argued that LGBTQ
people may not be comfortable fully accessing the services they need in
a religious environment. A comment on behalf of a local government
suggested that LBGTQ people who already have concerns about their
physical and emotional safety in accessing services--even in relatively
welcoming communities, like San Francisco--will face further inequities
because, the commenter believes, the proposed rules will encourage
discrimination against LGBTQ people. Another commenter suggested that
``a job-training organization could refuse to assist a transgender
individual with resume editing or professional wardrobe development
consistent with their gender identity.'' That commenter argued that
removing the notice and referral protections would empower
organizations operating critical social services to refuse to fully
serve LGBTQ people if those providers believe that recognizing an
individual's gender identity or same-sex relationship violates their
religious belief. That commenter also argued that people in the LGBTQ
community have faced a history of discrimination and, without proactive
notice of their rights, they would rely on their past experience to
inform relationships with service providers. This commenter added that
unwillingness of an organization to recognize and respect LGBTQ
identities is tantamount to a denial of care altogether, with the same
negative outcomes.
Commenters also argued that eliminating the notice-and-referral
requirements would especially burden beneficiaries with disabilities
who rely on service providers such as a case manager to coordinate
necessary services, a transportation provider to attend appointments,
and a personal care attendant to help with medications and managing
daily activities. These commenters were concerned that such
beneficiaries' access to services would be eliminated if such providers
refused to provide a service and then refused to provide a referral for
the beneficiary to obtain the service. These commenters were also
concerned that beneficiaries with disabilities who are also in other
historically disadvantaged groups were most likely to be refused
service and would face greater challenges to receive accommodations.
Some commenters hypothesized that faith-based organizations could
deny services outright based on sex; could claim religious
interpretations to avoid providing services based on prejudice, bias,
or stigma (a point addressed in Part II.E); and could delay or deny
services during emergencies. Others crafted more specific hypothetical
examples:
LGBTQ individuals might not have the same opportunities to
return to their communities if they are denied access to a Second
Chance Reentry Initiative program due to their sexual orientation or
gender identity, and they might not be given referrals to alternative
providers.
A same-sex couple could be refused family housing in the
wake of a natural disaster, or a transgender shelter seeker could be
refused gender appropriate housing by a FEMA grantee. The shelter could
also be empowered to refuse access to medically necessary care.
A FEMA grantee could claim a right to refuse to assist a
same-sex couple in requesting Federal disaster-relief benefits.
A transgender woman could risk being turned away from a
woman's emergency shelter or a same-sex couple could be refused family
housing at a HUD-funded provider.
People seeking treatment for opioid use disorder might be
prevented from receiving such treatment.
A woman seeking safety for herself and her family from
domestic violence could be prevented from finding a shelter.
A veteran re-entering the civilian workforce could be
prevented from receiving job training.
A woman could be denied benefits based on a provider's
religious belief that women should not work outside the home.
LGBTQ homeless teenagers might not seek housing, food, or
counseling services they need, including from a facility funded with
HUD's Emergency Shelter Grant (``ESG'') program, because they know the
religion of the faith-based provider condemns them for being gay.
A single mother or same-sex couple could be turned away
from assistance with buying their first home or preventing foreclosure.
A pregnant or parenting teenager who is unmarried or
divorced might avoid a faith-based provider or leave a faith-based
group home that she thinks will condemn her or because she is
uncomfortable in the religious setting.
Muslim people might forgo affordable housing funded by
HUD's Housing Opportunities for Persons with AIDS (``HOPWA'') program
because they feel uncomfortable at a facility with Christian
iconography throughout, even though receipt of HOPWA funds requires
that program content be secular.
A ``kid'' or ``young adult'' seeking HHS's Transitional
Living for Homeless Youth program services like a bed, educational
opportunities, or job training might be forced to receive services from
a faith-based provider and have no way to access an alternative
provider.
Unaccompanied minors might have no recourse to seek an
alternative provider if they were denied services because of the
provider's opposition to those services on religious grounds, such as
denial of transportation or interpretation services to attend a medical
appointment contrary to the provider's religious beliefs.
A nonreligious veteran at risk of homelessness seeking
help with case management who also wants services, including education,
crisis intervention, and counseling might feel ``very uncomfortable''
at a faith-based provider and not be aware of alternatives.
A homeless veteran seeking job training to gain employment
might be forced to receive those services from a faith-based provider
but feel uncomfortable because the program takes place in a room
adorned with religious banners, Bible verses, and religious symbols.
Victims of human trafficking seeking vital services to
build lives away from their traffickers, like housing or financial
assistance, might feel uncomfortable getting services from a faith-
based provider and drop out of the program, putting their safety at
risk.
An older LGBTQ person receiving food packages under the
USDA Commodity Supplemental Food Program could be forced to pick them
up in a church that he knows labels him as a sinner, when LGBTQ seniors
already struggle to access culturally-competent support services.
A student who identifies as LGBTQ or who is a child of
LGBTQ parents might be confronted with open anti-LGBTQ hostility by an
ED-funded social service program partnering with their public school to
provide healthcare screening, transportation, shelter, clothing, or new
immigrant services.
Local food distribution agencies, such as food pantries or
soup kitchens, might seek to deny services to vulnerable populations,
including atheists, transgender people, single mothers and their
children, and immigrants.
[[Page 82058]]
An atheist required to attend a substance use disorder
program might be compelled to attend a 12-step program that requires
the recognition of a higher power and, without notice of her rights,
might attend the program unsuccessfully, or forgo services, because she
thinks all programs will require adherence to a higher power.
Response: The Agencies believe that all people should be treated
with dignity and respect and should be given every protection afforded
by the Constitution and the laws passed by Congress. The Agencies do
not condone the unjustified denial of needed medical care or social
services, and they are committed to fully and vigorously enforcing all
of the nondiscrimination statutes for which Congress has granted them
jurisdiction. The Agencies take seriously the examples commenters have
cited, both real and hypothetical, as well as the studies commenters
referenced.
The Agencies, however, disagree that harms discussed in these
examples and studies overcome the reasons not to retain the notice
requirements and the referral requirement. None of these harms, actual
or hypothetical, arose in circumstances where those requirements would
necessarily have had, or did necessarily have, any effect. The examples
fail to show that these harms, if and when they occur, will necessarily
increase in the absence of, or have been appreciably reduced because
of, the notices and referrals required by the 2016 final rule. It will
always be possible to imagine a circumstance where these requirements
might have an effect, but the empirical data do not demonstrate that
the requirements had any measurable impact in actual cases in which
beneficiaries sought federally funded social services from religious
providers.
Commenters' most direct examples came from the national legal
organization that cited its clients and several studies. But even those
cases and studies do not involve the precise issues here. They do not
show harm unique to faith-based organizations receiving direct Federal
financial assistance attributable to beneficiaries' (1) not receiving
notice of a prohibition on discrimination based on religion (nor on
other grounds), (2) not receiving notice regarding explicitly religious
activities, (3) not receiving notice regarding referrals based on
objections to the provider's religious character, or (4) not receiving
a referral from the faith-based organization if the beneficiaries
object to the organization's religious character. The vast majority of
commenters' examples did not even involve faith-based organizations
providing services in connection with direct Federal financial
assistance. The cited harms are far beyond the scope of this final rule
and would not have been prevented by the notice requirements and the
referral requirement. Also, to the extent that these examples raise
conflicts between beneficiaries' rights and the religious liberties of
faith-based providers, resolution will depend on context-specific
analyses of those underlying rights, as discussed in Parts II.C.3,
II.E, and II.F.
For example, the national legal organization cited a case in which
one of its transgender clients was scheduled for a hysterectomy at a
religious hospital but had the procedure cancelled due to the
hospital's religious objection. The client did not allege that the
surgery was going to be provided through a Federal financial assistance
program or activity, did not allege that the hospital had used direct
Federal financial assistance for any explicitly religious activity, and
did not allege anything else that would have been covered by the notice
requirement. Complaint, Conforti v. St. Joseph's Healthcare Sys., No.
17-cv-50 (D.N.J. Jan. 5, 2017), ECF No. 1. Moreover, this client raised
the alleged discrimination with the commenting legal organization,
which filed a complaint with HHS's Office for Civil Rights within six
months. Id. ]] 8, 80. Also, this client alleged a desire to have the
surgery at the religious hospital where the client had received
previous care, without indicating any objection to the hospital's
religious character, id. ]] 49-50, 58-72. It is thus unclear how the
alternative-provider notice-and-referral requirements would have
assisted this client.
The court cases cited by another commenter involving discrimination
and denial of service in the criminal-justice system are even less
persuasive. There is no indication that the treatment provider in
either case was a faith-based organization or that the potential
beneficiary objected based on the religious character of the treatment
provider. Additionally, the conduct in those cases would not have been
covered by the other aspects of the notice because those cases did not
allege a claim of discrimination based on religion or a claim related
to explicitly religious activities. In Wilson v. Phoenix House, a
defendant supervisor in New York's Drug Treatment Alternative to Prison
program had denied a transgender client access to a support group. 2011
WL 3273179, at *1 (S.D.N.Y. Aug. 1, 2011). In Kaeo-Tomaselli v. Butts,
a librarian at the women's correctional center sought a halfway house
for a transgender prisoner who had not yet been released from prison,
and the defendants had refused the librarian's request. 2013 WL
5295710, at *1 (D. Haw. Sept. 17, 2013). Again, it is unclear how the
notice-and-referral requirements would have helped these individuals.
The example of Bhutanese Hindu refugees is especially telling. The
Agencies recognize the challenges faced by many immigrant and minority-
faith communities, including Bhutanese Hindu refugees. The Agencies are
concerned about the statistics and health risks cited by the commenter,
and the Agencies are proud that their programs serve this vulnerable
population. But this group, like all others, continues to be protected
from religious discrimination \22\ and, in direct Federal financial
assistance programs and activities, from being required to participate
in explicitly religious activities.
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\22\ See, e.g., 8 U.S.C. 1522(a)(5) (expressly requiring States
to provide assistance and services to refugees without regard to
religion, race, or nationality in domestic resettlement programs).
---------------------------------------------------------------------------
The Agencies are not aware of any causal connection between this
group's negative health outcomes and the notice or referral
requirements. In fact, several studies have analyzed the causes of this
group's increased risks and none attributed them to faith-based service
providers, lack of notice of religious liberty protections, or the
absence of a referral from a religious organization to a provider that
the beneficiary (or the commenter) deemed unobjectionable.\23\ The
concerns for Bhutanese Hindu refugees raised by these studies are
beyond the scope of this final rule, and the Agencies have already
begun to address them in other appropriate ways. For example, the
Refugee Health Technical Assistance Center--funded by HHS's Office of
Refugee Resettlement--
[[Page 82059]]
responds to the tragedy of suicide within refugee communities through
both prevention and targeted intervention, with resources dedicated to
Bhutanese refugees.\24\ And current research that proposes models to
address these issues suggests that religious connection is beneficial
but does not suggest that notice of religious liberty protections in
federally funded programs would have any impact on suicide rates.\25\
The Agencies, therefore, have determined that removing the notice
requirement will not harm this community and may assist this community
by reducing barriers to entry into programs that address the causes of
negative health impacts identified in the studies, including financial
stresses, gender-based violence, mental health, alcohol abuse, and
other vulnerabilities.
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\23\ See, e.g., Trong Ao et al., Suicidal Ideation and Mental
Health of Bhutanese Refugees in the United States, 18(4) J. Immig. &
Minor. Health, 828 (Aug. 2016), https://www.ncbi.nlm.nih.gov/pmc/articles/PMC4905789/; Ashley K. Hagaman et al., An Investigation
into Suicides Among Bhutanese Refugees Resettled in the United
States Between 2008 and 2011, 18(4) J. Immigr. Minor. Health 819
(Jan. 2016), https://www.researchgate.net/publication/290197605_An_Investigation_into_Suicides_Among_Bhutanese_Refugees_Resettled_in_the_United_States_Between_2008_and_2011; Jennifer Cochran
et al., Suicide and Suicidal Ideation Among Bhutanese Refugees--
United States, 2009-2012, 62(26) Morbidity & Mortality Weekly Rep.
533 (July 5, 2013), https://www.ncbi.nlm.nih.gov/pmc/articles/PMC4604782/; International Organization for Migration, Who Am I?
Assessment of Psychosocial Needs and Suicide Risk Factors Among
Bhutanese Refugees in Nepal and After Third Country Resettlement
(2011), https://www.iom.int/sites/default/files/our_work/DMM/Migration-Health/MP_infosheets/Bhutanese-Mental-Health-Assessment-Nepal-23-March_0.pdf.
\24\ See Refugee Health Technical Assistance Center, Suicide
Prevention, https://refugeehealthta.org/physical-mental-health/mental-health/suicide/suicide-prevention/; see also Prangkush Subedi
et al., Mental Health First Aid Training for the Bhutanese Refugee
Community in the United States, Int'l J. Mental Health Sys. 9:20
(2015), https://ijmhs.biomedcentral.com/track/pdf/10.1186/s13033-015-0012-z; Suicide Prevention Resources Center, Bhutanese Community
Leaders Work to Prevent Suicide Among Refugees in New Hampshire (May
16, 2014), http://www.sprc.org/news/bhutanese-community-leaders-work-prevent-suicide-among-refugees-new-hampshire (describing
targeted programming based on a survey of Bhutanese refugees living
in that community).
\25\ Jonah Meyerhoff et al., Suicide and Suicide-Related
Behavior Among Bhutanese Refugees Resettled in the United States,
9(4) Asian Am. J. Psychol. 270 (Dec. 2018), https://www.ncbi.nlm.nih.gov/pmc/articles/PMC6980157/.
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Some of the studies and reports cited by commenters claimed to
demonstrate that LGBTQ beneficiaries have unique needs for which it is
difficult to find alternative medical providers. If that is so, then
notice and referrals are correspondingly less likely to be effective.
Indeed, the cited studies identified the likely causes of these issues
and prescribed solutions, but those studies did not mention notice of
religious liberty protections or mandatory referrals by faith-based
organizations as part of the problem or solution.\26\
---------------------------------------------------------------------------
\26\ See, e.g., Jaclyn M. White Hughto et al., Transgender
Stigma and Health: A Critical Review of Stigma Determinants,
Mechanisms, and Interventions, HHS Public Access, Author Manuscript
at 5 (published in final edited form at 147 Soc. Sci. Med. 222 (Dec.
2015)), https://www.ncbi.nlm.nih.gov/pmc/articles/PMC4689648/pdf/nihms739646.pdf (study cited by commenters, attributing the limited
availability of appropriate transgender medical care primarily to
lack of trained healthcare providers); id. at 11-12 (prescribing
education and inter-group contact for providers).
---------------------------------------------------------------------------
The American Atheists Survey is even less relevant.\27\ In addition
to the general points that apply to many studies, that study analyzed
self-reported ``negative experiences'' in specific ``locations''
without any indication that the negative experience was caused by the
service provider. Additionally, while the study showed that between 4.5
percent and 17.7 percent of atheists have negative experiences in
certain service locations, 54.5 percent of those same respondents
indicated such negative experiences when interacting with their own
families and 19.1 percent of the respondents reported negative
experiences when accessing ``private businesses.'' This survey does not
demonstrate any harm that would result from removal of the notice-and-
referral requirements. To the extent this survey identifies a broader
societal problem, the solution is beyond the scope of this final rule.
---------------------------------------------------------------------------
\27\ See American Atheists, Reality Check: Being Nonreligious in
America (2020), https://static1.squarespace.com/static/5d824da4727dfb5bd9e59d0c/t/5ec6d6d8e8da850b30521353/1590089442015/Reality+Check+-+Being+Nonreligious+in+America (referenced in the
comments as unpublished and reviewed by the Agencies subsequent to
publication).
---------------------------------------------------------------------------
Similarly, some of these comments focused on the challenges of
service availability in rural areas, based on the 2018 CAP Survey and
other commenters' reports. The lower demand and fewer resources in
rural areas can lead to provider shortages that result in beneficiaries
having to travel farther, on poorer roads, with limited access to
public transportation. The Agencies agree that obtaining services from
an alternative provider can be more difficult in rural areas than in
urban areas, and the relevant Agencies are working to address those
concerns with rules, programs, and services apart from this final rule.
But these challenges predated both the 2016 final rule and this final
rule, and the Agencies disagree that the notice requirements and the
referral requirement addressed these challenges in any meaningful way.
Indeed, the preamble to the 2016 final rule recognized that it may be
``impossible'' to guarantee an alternative provider for services
provided in a ``remote location.'' 81 FR 19364; see also id. at 19368
(``The Agencies believe that, in some cases, due to the location of the
organization, availability of resources, the nature of the program, or
other factors, a referral option may not be available.''). As a result,
the referral requirement might be even less valuable to beneficiaries
in rural areas. Whatever marginal value it might afford would not
outweigh the other reasons given for eliminating the referral
requirement.
Many of the studies did not analyze the critical issues necessary
to draw relevant conclusions regarding the alternative provider notice-
and-referral requirements. Those studies did not involve or
specifically address federally funded programs, and the statistics
cited by commenters differ from Federal data reported by grantees.\28\
The studies did not analyze the incidents of harms by faith-based
providers as opposed to other providers. Also, they did not identify
problems attributable to the absence of, or that would be remedied by,
the notice-and-referral requirements. Instead, many of these studies
raise broader concerns regarding issues that are beyond the scope of
this final rule, such as discrimination and the balance between LGBTQ
rights and religious liberties. Finally, many of the studies have
methodological limitations, recognized the possibility that other
factors could account for the observed behaviors, and called for
further research.\29\
---------------------------------------------------------------------------
\28\ For example, with regard to youth homelessness, one percent
of unaccompanied youth self-identified as LGBT nationwide. HUD
Exchange, HUD, PIT and HIC Data Since 2007 (Jan. 2020), https://www.hudexchange.info/resource/3031/pit-and-hic-data-since-2007.
Also, a runaway and homeless youth site in New York reported 23.3
percent of the youth homeless population it served to be LGBT.
Administration for Children and Families, HHS, Final Report--Street
Outreach Program Data Collection Study (Apr. 12, 2016), https://www.acf.hhs.gov/archive/fysb/resource/street-outreach-program-data-collection-study.
\29\ See, e.g., American Atheists, Reality Check: Being
Nonreligious in America (2020), https://static1.squarespace.com/static/5d824da4727dfb5bd9e59d0c/t/5ec6d6d8e8da850b30521353/1590089442015/Reality+Check+-+Being+Nonreligious+in+America
(published after submission of comments); Office of Disease
Prevention and Health Promotion, Healthy People 2020 (last updated
Oct. 8, 2020), https://www.healthypeople.gov/2020/topics-objectives/topic/social-determinants-health/interventions-resources/discrimination; Caitlin Rooney et al., Center for American Progress,
Protecting Basic Living Standards for LGBTQ People (2018) https://www.americanprogress.org/issues/lgbt/reports/2018/08/13/454592/protecting-basic-living-standards-lgbtq-people/; Sejal Singh
andLaura E. Durso, Center for American Progress, Widespread
Discrimination Continues to Shape LGBT People's Lives in Both Subtle
and Significant Ways (May 2, 2017), https://www.americanprogress.org/issues/lgbtq-rights/news/2017/05/02/429529/widespread-discrimination-continues-shape-lgbt-peoples-lives-subtle-significant-ways/; Chapin Hall, Missed Opportunities: Youth
Homelessness in America 10 (2017), https://voicesofyouthcount.org/wp-content/uploads/2017/11/VoYC-National-Estimates-Brief-Chapin-Hall-2017.pdf (mentioning the need to identify at-risk youth and
initiate ``service referrals'' to an initial provider, with no
mention of faith-based providers or objections to any provider);
Sandy E. James et al., National Center for Transgender Equality, The
Report of the 2015 U.S. Transgender Survey (Dec. 2016), https://transequality.org/sites/default/files/docs/usts/USTS-Full-Report-Dec17.pdf; Jaclyn M. White Hughto et al., Transgender Stigma and
Health: A Critical Review of Stigma Determinants, Mechanisms, and
Interventions, 147 Soc. Sci. Med. 222 (Dec. 2015), https://www.ncbi.nlm.nih.gov/pmc/articles/PMC4689648/pdf/nihms739646.pdf;
Justice in Aging, LGBT Older Adults in Long-Term Care Facilities:
Stories from the Field 11 (updated June 2015),
www.justiceinaging.org.customers.tigertech.net/wp-content/uploads/2015/06/Stories-from-the-Field.pdf (citing examples of patients
being ``prayed over'' or told they would go to hell but without
referencing key factors, including whether the provider was faith-
based (or whether it was a religiously motivated staff person who
caused the issue)); Karen Fredriksen-Goldsen et al., The Aging and
Health Report: Disparities and Resilience Among Lesbian, Gay,
Bisexual, and Transgender Older Adults 17-18, 38, 47 (Nov. 2011),
https://www.lgbtagingcenter.org/resources/pdfs/LGBT%20Aging%20and%20Health%20Report_final.pdf (noting that 38
percent of respondents ``currently attend spiritual or religious
services or activities at least once a month''--and identifying
``referral services'' as a needed service, apparently referencing
initial provider referrals--and making no mention of objections);
SAGE and Movement Advancement Project, Improving the Lives of LGBT
Older Adults 52, 60 (Mar. 2010), https://www.lgbtmap.org/file/improving-the-lives-of-lgbt-older-adults.pdf (indicating that LGBT
advocates should provide information and referrals, including to
``local LGBT-friendly experts'').
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[[Page 82060]]
Similarly, the example of end-of-life issues is not relevant. End-
of-life issues and the balance of rights between patients, healthcare
employees, and affiliated organizations are governed by a complex set
of statutes and regulations that fall outside the scope of this
rulemaking. There is no reason to believe that the notice-and-referral
requirements would affect the situation raised by the comment about
disagreements over when it is appropriate to end aggressive treatments
for a patient. The 2016 final rule did not require the notice to
describe the religious character or tenets of the provider, such as a
hospital's connection to the Roman Catholic Church or its adherence to
ethical directives of the Catholic Church. The notice would not have
conveyed in any helpful detail how a particular physician or treatment
facility would approach an end-of-life scenario. That information is
more likely to be discernible from the provider's name, especially when
combined with the information on the provider's website, and other
informational materials unaffected by this final rule.
The Agencies also disagree that various groups' prevalent use of
federally funded programs would translate into disproportionate harms
to those groups from removal of the notice-and-referral requirements.
The Agencies are proud that these comments, including ones supported by
research, demonstrate that people with unique needs and challenges
benefit from the Agencies' programs and services. The Agencies will
continue to support appropriate programming for all communities in
need. But for the reasons discussed in Part II.C, a community's
widespread participation in federally funded programming does not show
that the removal of the notice-and-referral requirements would increase
the likelihood of negative outcomes, such as increased poverty and
unemployment, among this population. None of the surveys or reports
discussed in comments makes such a showing. Moreover, these surveys
rely on programs not directly relevant here. For example, commenters
relied on the portion of the 2018 CAP Survey that cited instances in
indirect-aid programs, such as SNAP and some housing assistance
programs, that were never subject to the notice-and-referral
requirement. 81 FR 19363, 19386, 19414. As such, these sources cannot
support the contention that the notice-and-referral requirements
alleviated instances of alleged harm--or that the removal of such
requirements would increase the risk of instances of such harm.
All of these responses apply with equal or greater force to the
commenters' hypothetical claims of harms. Many of the programs cited by
the commenters operate in contexts that further minimize the risk of
harm to beneficiaries. For example, several commenters claimed there
were unique needs for objections to religious character by victims and
survivors of human trafficking. As suggested by the Council Chair, the
Agencies can certainly imagine a victim of human trafficking who does
not speak English, is in an unfamiliar location, is a single parent and
does not have reliable internet; who has to research an alternative
provider while working and caring for young children; and who needs
guaranteed assistance finding an alternative provider. The relevant
Agencies are working very hard to support and provide services for
victims of human trafficking, including those with any of the listed
characteristics. Research shows that human trafficking victims and
survivors face many substantial and documented hurdles to receiving
care, especially those victims and survivors residing in regions that
have limited resources. However, and even though many studies have
included faith-based service providers, the Agencies are not aware of
any research indicating that objections to the religious character of
the provider is a hurdle for potential beneficiaries at all, let alone
a substantial hurdle.\30\ Instead of addressing hypothetical harms that
seem to arise infrequently at best, the Agencies and experts in the
field are moving toward incorporating first-person victim experiences
into trafficking policy, programs, research, evaluation, and responses,
with safeguards to minimize re-victimization or re-traumatization.\31\
These data, in short, do not indicate a need for the notice
requirements or the referral requirement.
---------------------------------------------------------------------------
\30\ See, e.g., U.S. Department of State, Trafficking in Persons
Report 20-21, 28-33 (20th ed. June 2020), https://www.state.gov/wp-content/uploads/2020/06/2020-TIP-Report-Complete-062420-FINAL.pdf
(describing the challenges of ``trauma bonding,'' extraterritorial
abuse and exploitation, the many ways providers need to
``reengineer[ ]'' health care for survivors, and the intersection
between trafficking and addiction); Elzbieta Gozdziak and Lindsay
Lowell, After Rescue: Evaluation of Strategies to Stabilize and
Integrate Adult Survivors of Human Trafficking to the United States
5, 10-29 (Apr. 2016), https://www.ncjrs.gov/pdffiles1/nij/grants/249672.pdf (describing the challenges of survivors' needs and
survivor stabilization facing programs, including ones run by faith-
based organizations before the referral requirement was
promulgated); Laura Simich et al., Improving Human Trafficking
Victim Identification--Validation and Dissemination of a Screening
Tool 12, 184-87 (June 2014), https://www.ncjrs.gov/pdffiles1/nij/grants/246712.pdf (describing many of the challenges of meeting the
needs of human trafficking victims and survivors in a study that
worked with faith-based providers).
\31\ See, e.g., National Institute of Justice, Expert Working
Group on Trafficking in Persons Research Meeting 13-17 (Apr. 24-25,
2014), https://www.ncjrs.gov/pdffiles1/nij/249914.pdf.
---------------------------------------------------------------------------
The Agencies, moreover, recognize that faith-based providers have
been integral to the national and international efforts to address
human trafficking and to respond to the needs of victims and
survivors.\32\ There is no suggestion that these faith-based
organizations, which are committed to the fight against human
trafficking and the care of trafficking victims and survivors, would
further traumatize those individuals by seeking to convert them. The
Agencies also recognize that some studies indicate that alternatives to
traditional therapies, including ``offering organized religious or
spiritual activities to help victims connect to something that will
last beyond the program timeframe,'' are ``considered important adjunct
therapies for this population.'' \33\ Human trafficking victims often
interact with multiple agencies, including law enforcement agencies,
that can provide referrals to alternative providers if the
[[Page 82061]]
victim would like one. Also, human trafficking service providers
commonly have informational materials available in multiple languages,
which reference national and regional hotlines that can otherwise
provide referrals to any beneficiary who cannot undertake research or
labor-intensive efforts to locate a provider. The Agencies determine,
in their policy discretion, that it is appropriate to direct their
funding and related requirements toward meeting the documented needs of
human trafficking victims and survivors rather than an undocumented
need to address objections to providers' religious character.
---------------------------------------------------------------------------
\32\ See, e.g., U.S. Department of State, Trafficking in Persons
Report 24-25 (20th ed. June 2020), https://www.state.gov/wp-content/uploads/2020/06/2020-TIP-Report-Complete-062420-FINAL.pdf
(describing faith-based organizations' efforts to combat human
trafficking and the reasons such organizations ``are powerful and
necessary forces in the fight against human trafficking'').
\33\ Heather Clawson et al., Treating the Hidden Wounds: Trauma
Treatment and Mental Health Recovery for Victims of Human
Trafficking 7 (Mar. 15, 2008) (describing the many challenges of
treating human trafficking victims), https://aspe.hhs.gov/system/files/pdf/75356/ib.pdf.
---------------------------------------------------------------------------
Commenters' hypothetical example of a faith-based organization
acting with open hostility toward an LGBTQ public school student is
similarly inapt. There is no basis to conclude that faith-based
providers would show such anti-LGBTQ hostility in an ED-funded program
run through a public school. Yet even so, it is unclear how the notice-
and-referral requirements would have helped the student. Students
subjected to such hostility would most likely seek redress or referral
to an alternative provider through their public school, not from the
provider.
The hypotheticals, provided in the comments, also relied on claims
of discrimination on bases other than religion in reentry programs,
disaster relief programs, food pantries, substance use disorder
programs, medical care programs, women's emergency shelters, and HUD
housing programs, without explaining how those harms were connected to,
or were addressed by, the notice-and-referral requirements. The same is
true for the hypotheticals suggesting that providers would deny
services based on sex; delay or deny services during emergencies; deny
services to unaccompanied minors; make beneficiaries uncomfortable; or
claim religious interpretations to avoid providing services based on
prejudice, bias, or stigma. For example, many domestic violence
shelters admit women with male children only below a certain age to
protect victims and minimize re-traumatization. Other laws and policies
determine whether and when such a shelter must admit a transgender
person. These policies are unrelated to the alternative provider
notice-and-referral requirements. Nonetheless, for completeness, the
Agencies note that, if such admission were required contrary to a
faith-based provider's sincerely held religious beliefs, it could seek
an accommodation under this final rule, which would be handled in a
context-specific analysis that is explained in Part II.E. Otherwise,
however, this issue is beyond the scope of this final rule regarding
equal participation of faith-based organizations and, in all events,
was not addressed by the notice-and-referral requirements.
Many of these examples raise forms of discrimination or other
conduct that are prohibited by other provisions within the Agencies'
regulations but were not addressed by the notice-and-referral
requirements. For instance, commenters' examples include a hypothetical
beneficiary who seeks to participate in the Second Chance Act Reentry
Initiative administered by DOJ's Office of Justice Programs but is
excluded based on sexual orientation or gender identity. Like all DOJ
grants, providers in this program must comply with several
nondiscrimination provisions, including the prohibition on
discrimination on the basis of sex under section 901 of Title IX of the
Education Amendments of 1972.\34\ How those requirements would apply is
beyond the scope of the final rule and entirely unaffected by removal
of the notice-and-referral requirements. To the extent these commenters
raise concerns about the use of religion as a pretext for unlawful
discrimination, the Agencies address these concerns in Part II.E.
---------------------------------------------------------------------------
\34\ See, e.g., Office of Justice Programs, Department of
Justice Grants and Cooperative Agreements: Statutes and Regulations
Related to Civil Rights and Nondiscrimination (updated Mar. 2018),
https://www.ojp.gov/program/civil-rights/statutes-regulations.
---------------------------------------------------------------------------
For all of these reasons, the Agencies determine that removing the
notice requirements and the referral requirement will not unduly harm
beneficiaries, including beneficiaries from the populations identified
by commenters, and will not make it more likely that such vulnerable
groups do not receive needed services. Removing these requirements is
also appropriate to address the tension with the Free Exercise Clause
and with RFRA, discussed next. To the extent any of these hypotheticals
demonstrate that broader substantive protections are necessary, they
should apply to non-faith-based providers as well as faith-based
providers, and they are therefore beyond the scope of this final rule.
Changes: None.
Affected Regulations: None.
3. Tension With the Free Exercise Clause and RFRA
a. Unequal Burdens
Summary of Comments: Several commenters said that, under the Free
Exercise Clause, strict scrutiny applies to government funding programs
that discriminate against, or impose special burdens on, faith-based
organizations because of their religious character or status, as
outlined in Trinity Lutheran Church of Columbia, Inc. v. Comer, 137 S.
Ct. 2012 (2017); Church of the Lukumi Babalu Aye, Inc. v. City of
Hialeah, 508 U.S. 520 (1993); Executive Order 13831; and the Attorney
General's Memorandum. These commenters, including 21 current members of
the House of Representatives and a State attorney general, argued that
the notice-and-referral requirements should be removed because they
imposed unfair and discriminatory burdens on faith-based organizations
that either violated or were in tension with this Free Exercise Clause
standard.
Some commenters argued that the holding in Trinity Lutheran did not
provide a sufficient justification for the removal of the notice-and-
referral requirements due to the dissimilarities discussed throughout
this section that commenters perceived between the prior rule and
issues presented in Trinity Lutheran--namely, that the notice-and-
referral requirements did not exclude faith-based organizations from
participation in federally funded government programs; that the
requirements were justified on the basis of religious activity, not
religious character; and that the holding in Trinity Lutheran was not
applicable, given its perceived limitation to the facts before the
Court.
Some commenters argued that the alternative provider notice-and-
referral requirements violated Trinity Lutheran's holding by facially
discriminating on the basis of religious character. These commenters
reasoned that the notice-and-referral requirements applied explicitly
based on the providers' ``religious character.'' In one public comment,
the Council Chair--who opposed removal of these requirements--agreed
that these requirements applied only to religious organizations because
they were based on ``a beneficiary's objection to an organization's
`religious character.' '' And the other aspects of the notice
requirement applied solely to faith-based organizations based on that
status.
Some commenters argued that strict scrutiny would apply to the
notice-and-referral requirements under Trinity Lutheran--both as
unequal treatment and as special burdens--because those requirements
were imposed on faith-based, but not secular, organizations. Some of
these commenters added that this unequal treatment stigmatized faith-
based providers as inferior, offensive, or ``second class citizens.''
Another commenter added that these
[[Page 82062]]
requirements created the impression that the Government considers
religious people inherently suspect because of their faith, suggesting
that the Government believes Americans are more likely to find
religious providers objectionable than secular providers.
Some of these commenters supported removal of these requirements to
create a level playing field for faith-based and secular organizations,
consistent with Trinity Lutheran. Some added that removing the
requirements would restore an environment of religious freedom across
the country and ensure that faith-based organizations are free to offer
services, help their communities, and follow their missions unhindered
by burdensome government regulations.
Several commenters, however, argued that the Free Exercise Clause
requirement to treat secular and religious organizations equally only
applies when a rule ``categorically exclude[s]'' religious
organizations from receiving grants or other benefits ``solely''
because of their religious character. Some of these commenters argued
that Trinity Lutheran and McDaniel v. Paty, 435 U.S. 618 (1978)
(plurality opinion), apply only when the benefit at issue was denied in
its entirety, or the organization was deemed ineligible solely because
of its religious character. These commenters argued that this standard
does not apply to laws that allow faith-based organizations to
participate in a program with safeguards to protect beneficiaries'
religious liberty. A few advocacy organizations argued that Locke v.
Davey, 540 U.S. 712 (2004), allows exclusions based on factors other
than the religious character of an organization or program. They
pointed to Locke's upholding a law barring state funding, even in an
otherwise neutral indirect-aid program, for an ``essentially religious
endeavor.'' In contrast, they said, Trinity Lutheran only applies to
exclusions based solely on religious character.
These commenters argued that the notice-and-referral requirements
did not violate this standard because faith-based organizations were
still allowed to compete to participate in the Agencies' programs as
providers. They characterized the notice-and-referral requirements as
appropriate safeguards balanced to protect the competing interests of
providers and beneficiaries. Some said the requirements were applied
only to faith-based providers to protect the religious rights of the
people they serve, not to disfavor those providers for their religious
character. Some commenters also claimed that the requirements did not
create constitutional problems because, as they saw it, the 2016 final
rule generally allowed faith-based organizations to receive grants on
``the same basis as'' secular organizations. See 81 FR at 19358
(describing this requirement).
Several commenters argued that the notice-and-referral requirements
had the effect of excluding faith-based organizations only if they
declined to provide the required notice or referral, not because of
their religious character. These commenters added that no Agency had
pointed to evidence that any faith-based organization had actually been
excluded because it had run afoul of these requirements. Some also
noted that the 2016 final rule expressly stated that providers could
not be excluded from participation in programs because of their
religious character. Commenters added that, if an agency excluded a
faith-based organization for refusing to comply with the rule, the
Agencies could make clear that the exclusion was because of the
organization's religious activity, not its religious character.
One commenter argued that the notice-and-referral requirements were
``simply one practical way to ensure that rules are understood and
respected'' and that similar notices were required by the Fair Labor
Standards Act (FLSA), 29 CFR 516.4; the Equal Employment Opportunity
Act (EEOA), 29 CFR 1601.30; and the Family Medical Leave Act (FMLA), 29
CFR 825.300(a). Another commenter made the same point based on a poster
requirement that applies to ``all persons subject to section 804'' of
the National Housing Act, 24 CFR 110.10.
Several commenters asserted that Trinity Lutheran's holding applies
only to the specific facts of that case--``discrimination based on
religious identity with respect to playground resurfacing''--because of
a footnote in the plurality portion of the opinion. 137 S. Ct. at 2024
n.3. These commenters relied on the footnote's statement that the
decision did not ``address religious uses of funding or other forms of
discrimination.'' Id. Some added that cases decided by the U.S. Court
of Appeals for the Third Circuit and District of Maine--Real
Alternatives v. Sec'y HHS, 867 F.3d 338, 361 n.29 (3d Cir. 2017), and
Carson v. Makin, 401 F. Supp. 3d 207, 211 (D. Me. 2019)--interpreted
this footnote as limiting Trinity Lutheran to its facts. Several
commenters argued that excluding a faith-based organization from a
program to fund resurfacing material for playgrounds is very different
from requiring a faith-based organization to comply with the notice-
and-referral requirements.
Finally, one commenter cited Employment Division, Department of
Human Resources of Oregon v. Smith, 494 U.S. 872, 878-79, 885 (1990),
to argue that the notice-and-referral requirements were
constitutionally permissible because the First Amendment does not
provide individuals with an unconditional right to act in accordance
with their religion.
Response: The Agencies agree with the commenters who argued that
the notice-and-referral requirements were in tension with the Supreme
Court's subsequent decisions in Trinity Lutheran Church of Columbia,
Inc. v. Comer, 137 S. Ct. 2012 (2017), and Espinoza v. Montana
Department of Revenue, 140 S. Ct. 2246, 2255-26 (2020). Under Trinity
Lutheran, government-funded programs that ``single out the religious
for disfavored treatment'' are subject to the ``strictest'' or ``most
exacting scrutiny.'' 137 S. Ct. at 2019, 2021. This standard ``protects
religious observers against unequal treatment'' and from ``laws that
target the religious for `special disabilities' based on their
`religious status,''' id. at 2019, and is echoed in Executive Order
13831 and the Attorney General's Memorandum. The Supreme Court recently
reaffirmed the central holding of Trinity Lutheran and made clear that
the decision is not limited to the facts of that case but more broadly
addressed discrimination on the basis of religious status. Espinoza,
140 S. Ct. at 2255-56 (quoting Trinity Lutheran and citing cases).
It is unclear whether the holdings in these cases are limited to
categorical exclusion from government-funded programs or benefits on
account of religious character. To be sure, the facts of Espinoza and
Trinity Lutheran involved such exclusions.\35\ But the Supreme Court
also stated that a law may not ``regulate or outlaw conduct because it
is religiously motivated'' or `` `impose[ ] special disabilities on the
basis of religious status.' '' Trinity Lutheran, 137 S. Ct. at 2021
(emphasis added) (quoting Lukumi, 508 U.S. at 533). Trinity Lutheran
described ``the `injury in fact' '' in such cases as ``the inability to
compete on an equal footing in the bidding process, not the loss of a
contract.'' Id. at 2022 (quoting Ne. Fla. Chapter, Associated Gen.
Contractors of Am. v. Jacksonville, 508 U.S. 656, 666 (1993)). In
Espinoza, after repeating that
[[Page 82063]]
``status-based discrimination is subject to the `strictest scrutiny,'
'' the Court hastened to add that ``[n]one of this is meant to suggest
. . . that some lesser degree of scrutiny applies to discrimination
against religious uses of government aid,'' an issue the Court declined
to reach in that case. 140 S. Ct. at 2257 (quoting Trinity Lutheran,
137 S. Ct. at 2022).\36\ Most recently, in Roman Catholic Diocese of
Brooklyn v. Cuomo, 590 U.S. __, No. 20A87, 2020 WL 6948354 (Nov. 25,
2020) (per curiam), the Supreme Court granted an application for
preliminary injunctive relief from a governor's COVID-19 order that
applied stricter limits in certain zones on the numbers of people who
could gather in ``houses of worship'' than on the numbers who could
gather in ``essential'' businesses. See id. at *3 (``Because the
challenged restrictions are not `neutral' and of `general
applicability' they must satisfy `strict scrutiny' . . . .'').
---------------------------------------------------------------------------
\35\ See, e.g., Espinoza, 140 S. Ct. at 2260 (``When otherwise
eligible recipients are disqualified from a public benefit `solely
because of their religious character,' we must apply strict
scrutiny.'') (quoting Trinity Lutheran, 137 S. Ct. at 2021).
\36\ See also Central Rabbinical Congress of the U.S. & Can. v.
N.Y. City Dep't of Health & Mental Hygiene, 763 F.3d 183, 194-95 (2d
Cir. 2014) (applying strict scrutiny to law that singled out
specific religious conduct performed by a particular religious
group).
---------------------------------------------------------------------------
Because these Supreme Court decisions suggest that the forbidden
discrimination covers more than just categorical exclusions, the
Agencies conclude that the notice-and-referral requirements are at
least in tension with the Supreme Court's subsequent decisions in
Trinity Lutheran and Espinoza. As the Council Chair acknowledged, these
requirements applied solely to religious organizations, and the
organizations' obligation to make a referral was triggered solely by
beneficiaries' objections to their ``religious character.'' See
Espinoza, 140 S. Ct. at 2255-56 (holding the provision at issue was
based on religious character because it applied ``solely by reference
to religious status''). The notice requirement applied to ``religious
organizations,'' ``faith-based organization[s],'' or all ``religious
organizations, regardless of beliefs or conduct.'' \37\ The referral
requirement was triggered by objections to the organization's
``religious character.'' \38\
---------------------------------------------------------------------------
\37\ 81 FR at 19406-09 (ED, Sec. Sec. 3474.15(c)(1), 75.712,
76.712)); id. at 19411 (DHS, Sec. 19.6(a)); id. at 19414 (USDA,
Sec. 16.4(f)); id. at 19417 (HUD, Sec. 5.109(g)); id. at 19420
(DOJ, Sec. 38.6(c)); id. at 19423 (DOL, 29 CFR 2.34(a)); id. at
19425 (VA, Sec. 50.2(a); id. at 19428 (HHS, Sec. 87.3(i)(1)); see
also 81 FR at 19406-09 (ED, Sec. Sec. 3474.15(c)(1), 75.713, 76.713
(applying referral requirement to only ``a faith-based
organization'')).
\38\ 81 FR at 19407-09 (ED, Sec. Sec. 75.713(b)(1),
76.713(b)(1)); id. at 19412 (DHS, Sec. 19.7(b)); id. at 19414
(USDA, Sec. 16.4(g)(1)); id. at 19417 (HUD, Sec. 5.109(g)(3)(ii));
id. at 19421 (DOJ, Sec. 38.6(d)(2)); id. at 19423 (DOL, Sec.
2.35(b)); id. at 19425 (VA, Sec. 50.3(b)); id. at 19428 (HHS, Sec.
87.3(j)).
---------------------------------------------------------------------------
The Agencies also disagree that Locke necessarily implies that the
notice-and-referral requirements were permissible regulations of
religious activity. The challenged law in Locke prohibited the use of
State scholarship funds for ``religious training'' in ``devotional
theology.'' 540 U.S. at 719-21. The program denied funds to a recipient
because of what the recipient ``proposed to do--use the funds to
prepare for the ministry.'' Trinity Lutheran, 137 S. Ct. at 2023-24;
see also Espinoza, 140 S. Ct. at 2257 (distinguishing Locke). The Court
in Locke drew a distinction based on conduct--the ``essentially
religious endeavor'' of ``[t]raining someone to lead a congregation.''
540 U.S. at 721. In contrast, the notice-and-referral requirements were
triggered by an organization's religious character alone, not its
religious conduct, and applied to a use of funds that is required by
the rule to be secular.
Moreover, the Agencies disagree that notice-and-referral
obligations borne solely by faith-based organizations cannot ever rise
to the level of discrimination or impose special burdens. To be sure,
the costs of compliance may have been minimal, particularly in view of
the Agencies' experience that beneficiaries have almost never--and
perhaps have never--sought to invoke the referral option. But the
imposition of the notice-and-referral requirements arguably denied
faith-based organizations the opportunity ``to compete with secular
organizations'' on a level playing field, Trinity Lutheran, 137 S. Ct.
at 2022, and may have cast doubt on the suitability of religious
organizations to provide the social service in question. The
requirements gave the impression that such religious providers were not
favored or trusted to provide the particular social service in
accordance with the general requirements of the law, were more likely
to discriminate, or were more likely to be objectionable. The Agencies,
therefore, disagree that the required notice and concomitant referral
obligation could not have the effect of denigrating or casting a
negative light on faith-based providers.
The Agencies further disagree with commenters' suggestions that
these negative implications were tempered in any meaningful way by the
general assurances in the rule that religious organizations could
compete ``on the same basis as'' secular organizations and would not be
subject to discrimination based on their religious character. Those
general statements did not change the specific terms and effects of the
notice-and-referral requirements. The fact still remained that only
religious organizations bore those burdens.
The Agencies acknowledge that the notice-and-referral requirements
were not meant to denigrate or punish religious organizations but to
protect beneficiaries. The holdings in Trinity Lutheran and Espinoza,
however, did not turn on the intent of the Government. Because of the
uncertainty expressed above about what, if any, benefit the notice-and-
referral requirements provided beneficiaries, the Agencies are not
confident that the requirements would always survive the ``strictest''
or ``most exacting scrutiny'' as applied to particular cases. The
Agencies, therefore, conclude that prudential considerations justify
the rescission of these requirements.
The notice-and-referral requirements in the 2016 final rule were
materially different from the notices required by laws such as the
FMLA, EEOA, FLSA, and National Housing Act. Those laws required all
covered employers to provide comprehensive notice of employees' rights
irrespective of religious character. See, e.g., 29 CFR 516.4 (FLSA),
1601.30 (EEOA), 825.300(a) (FMLA); 24 CFR 110.10 (National Housing
Act). Employees receive those standard notices from every employer, and
the content of the notices provides no reason to believe that their
employer could be viewed with suspicion, or may be in some way
objectionable, on account of any unique status.
The Agencies also disagree with the comments that interpreted the
plurality's footnote 3 to limit Trinity Lutheran's holding to the facts
of that case--viz., playground resurfacing. As mentioned above, the
Supreme Court recently confirmed in Espinoza that the `` `strictest
scrutiny' '' applies to status-based discrimination on the basis of
religion in the context of a different government benefit--tax credits
for donations to organizations awarding scholarships.\39\ Nothing in
the logic or discussion of Trinity Lutheran or Espinoza suggests that
the nondiscrimination principle was limited to the facts of either
case.
---------------------------------------------------------------------------
\39\ Espinoza, 140 S. Ct. at 2257 (citing Trinity Lutheran, 137
S. Ct. at 2021); see also id. at 2254 (``The Free Exercise Clause .
. . protects religious observers against unequal treatment and
against laws that impose special disabilities on the basis of
religious status'').
---------------------------------------------------------------------------
This is consistent with the Agencies' understanding of Trinity
Lutheran. The Court's discussion of the principles it articulated
pointed to applicability beyond the facts immediately before it. See,
e.g., 137 S. Ct. at 2022 (``[T]he Free Exercise Clause protects against
indirect
[[Page 82064]]
coercion or penalties on the free exercise of religion, not just
outright prohibitions.'' (citing Lyng, 485 U.S. at 450)); id. at 2026
n.3 (Gorsuch, J., concurring, joined by Thomas, J.) (``I worry that
some might mistakenly read [footnote 3] to suggest that only
`playground resurfacing' cases, or only those with some association
with children's safety or health, or perhaps some other social good we
find sufficiently worthy, are governed by the legal rules recounted in
and faithfully applied by the Court's opinion.''). The lower court
cases that the commenters cited reaching contrary conclusions--Real
Alternatives and Carson--pre-date Espinoza and no longer have
persuasive value with respect to the meaning of footnote 3.
The Agencies also disagree that the Supreme Court's decision in
Employment Division v. Smith insulated the notice-and-referral
requirements from Free Exercise Clause concern. The notice-and-referral
requirements were neither generally applicable (since they applied only
to religious organizations) nor religion-neutral (since they required
referrals based on objections to religious character, but not other
characteristics of the provider). See Part II.F.2 (discussing the
standard in Lukumi, which clarifies the meaning of Smith); see also
Roman Catholic Diocese, 2020 WL 694354, at *2 (``Because the challenged
restrictions are not `neutral' and of `general applicability,' they
must satisfy `strict scrutiny,' and this means that they must be
`narrowly tailored' to serve a `compelling' state interest.'' (quoting
Lukumi, 508 U.S. at 546)).
In sum, the Agencies' position in this rulemaking is an exercise of
discretion and prudence, informed by principles of constitutional
avoidance. Cf. Edward J. DeBartolo Corp. v. Fla. Gulf Coast Bldg. &
Constr. Trades Council, 485 U.S. 568, 575 (1988). The Agencies have
discretion under their authorizing statutes to remove the notice-and-
referral requirements to avoid the constitutional issues raised by the
tension between those requirements and the Free Exercise Clause.
Espinoza left open additional issues, including ``whether there is a
meaningful distinction between discrimination based on use or conduct
and that based on status.'' 140 S. Ct. at 2257. The Agencies make the
reasonable decision, within their discretion, to eliminate this tension
and avoid the burdens and uncertainty of litigating these unresolved
issues. In so doing, the Agencies do not believe they have triggered
any countervailing Establishment Clause concerns. The Supreme Court has
``repeatedly held that the Establishment Clause is not offended when
religious observers and organizations benefit from neutral government
programs.'' Id. at 2254 (citing Locke, 540 U.S. at 719, and Rosenberger
v. Rector and Visitors of Univ. of Va., 515 U.S. 819, 839 (1995)).
Indeed, while upholding the prohibition on use of scholarships for
training to become clergy in Locke, the Supreme Court emphasized that
the Government could also have funded allowed such uses, consistent
with the Establishment Clause. 540 U.S. at 719 (``[T]here is no doubt
that the State could, consistent with the Federal Constitution, permit
. . . [students funded by the program] to pursue a degree in devotional
theology.'').
For all of these reasons, the Agencies disagree with the commenters
who suggest that relying on constitutional concerns potentially raised
by Trinity Lutheran and Espinoza as one of the justifications for
eliminating the notice-and-referral requirements is arbitrary and
capricious.
Changes: None.
Affected Regulations: None.
b. Substantial Burdens
Summary of Comments: Some commenters argued that the notice-and-
referral requirements imposed, or could impose, substantial burdens on
faith-based organizations' religious exercise under RFRA. These
commenters argued that faith-based organizations could have complicity-
based objections to providing such notice and referral, and that those
objections should be respected, as were the complicity-based objections
in Burwell v. Hobby Lobby, 573 U.S. 682 (2014). One religious
organization commented that many religions prohibit complicity in sin
and argued that the previous administration mistakenly had tried to
downplay the gravity of such religious objections. Another commenter
said that, by singling out faith-based providers, the notice-and-
referral requirements were in tension with RFRA and the related
principles in the Attorney General's Memorandum. Some commenters
contended that it was irrelevant to the substantial burden analysis
whether an organization could exercise its religious beliefs in other
ways.
Several commenters argued that the Agencies could not rely on RFRA
because they had not actually asserted that, or adequately explained
how, notice-and-referral requirements imposed a substantial burden
under RFRA. They charged that the Agencies were unable to point to any
specific situation where these requirements had imposed substantial
burdens on providers, including any situation where a faith-based
organization claimed that the requirements compelled it to violate its
sincerely held beliefs. As a result, some of these commenters argued
that the Agencies' analysis was inadequate to support removal of these
requirements based on RFRA.
Some commenters relied on a court of appeals decision holding that
a substantial burden requires `` `substantial pressure on an adherent
to modify his behavior and to violate [their] beliefs.' '' Kaemmerling
v. Lappin, 553 F.3d 669, 678 (D.C. Cir. 2008) (quoting Thomas v. Review
Bd., 450 U.S. 707, 718 (1981)). Others cited language from a different
court of appeals that a substantial burden ``is one that forces the
adherents of a religion to refrain from religiously motivated conduct,
inhibits or constrains conduct or expression that manifests a central
tenet of a person's religious beliefs, or compels conduct or expression
that is contrary to those beliefs.'' Civil Liberties for Urban
Believers v. City of Chi., 342 F.3d 752, 761 (7th Cir. 2003)
(``C.L.U.B.'') (citation omitted); see also id. (holding that a law
``that imposes a substantial burden on religious exercise is one that
necessarily bears direct, primary and fundamental responsibility for
rendering religious exercise . . . effectively impracticable'').
Many commenters argued that the burdens imposed by the notice-and-
referral requirements did not meet these legal standards. Some
commenters argued that the notice-and-referral requirements could not
have imposed a substantial burden because the burden of compliance was
``de minimis,'' imposed only ``minor costs,'' or was only a ``minimal
imposition.'' They reasoned that faith-based organizations only had to
provide a notice, reproduce language provided by the Agencies, exert
``reasonable'' efforts to find an alternative provider when requested,
and notify the awarding agency if they were unable to find an
alternative. Some argued that there was no substantial burden because
the costs of compliance were offset by the Government's funding that
the religious service providers had accepted. Others argued that
participation in government-funded programs was voluntary, so faith-
based organizations could decline the funding and avoid the associated
requirements. Multiple commenters argued that the Agencies' position
that the referral requirement was rarely invoked is at odds with the
position that it imposed a substantial burden.
[[Page 82065]]
Several commenters cited RFRA cases to discredit the notion that
the notice-and-referral requirements could raise complicity-based
objections. Some distinguished Hobby Lobby because it did not involve a
referral requirement or because it concerned a privately held
corporation whose employees were not obligated to work. According to
these commenters, faith-based organizations freely choose to seek
Federal funding for the programs governed by this rule and understand
that they serve a ``captive audience'' whose religious liberty must be
protected by the Constitution. Another commenter argued that the act of
referral cannot create a substantial burden because the organization is
actually objecting to ``what follows from'' the referral, meaning the
conduct that the beneficiary might engage in with the alternate
provider. The commenter argued that two appellate decisions \40\
involving objections to what is colloquially referred to as the
contraceptive mandate demonstrate that faith based organizations ``have
no recourse'' for such an objection. Some commenters argued that any
faith-based organization refusing to provide a referral to an
alternative provider was not truly religious, was not being faithful to
its religious beliefs, or was not ``truly Christian.''
---------------------------------------------------------------------------
\40\ See California v. U.S. Dep't of Health & Human Servs., 941
F.3d 410 (9th Cir. 2019), vacated by Dep't of Health & Human Servs.
v. California, No. 19-1038, 2020 WL 3865243 (July 9, 2020);
Pennsylvania v. Trump, 930 F.3d 543, 573 (3d Cir. 2019), rev'd by
Little Sisters of the Poor Saints Peter & Paul Home v. Pennsylvania,
140 S. Ct. 2367 (July 8, 2020) (``Little Sisters'').
---------------------------------------------------------------------------
Some organizations argued that the notice-and-referral requirements
did not impose a substantial burden because of countervailing
interests. For example, a faith-based organization argued that referral
requirements did not ``substantially burden'' the ``religious
exercise'' of faith-based organizations because the requirements were
``clearly tied'' to the objectives of a government service that the
organization voluntarily provides. Similarly, other commenters pointed
to a passage from the preamble to the 2016 final rule that the required
notice language ``does not place an undue burden on recipients of
Federal financial assistance, particularly when balanced against the
notice's benefit--informing beneficiaries of valuable protections of
their religious liberty.'' Some commenters relied on Locke v. Davey,
which found that a condition on funding imposed a ``relatively minor
burden.'' 540 U.S. at 725 (2004).
Response: The Agencies disagree with any contention that the
notice-and-referral requirements categorically did or did not impose a
substantial burden. Rather, the Agencies take the position that these
requirements were in tension with RFRA because they could have imposed
a substantial burden in certain circumstances, as the Agencies
explained in the NPRMs.
A regulation imposes a substantial burden when it (1) requires a
person to take, or abstain from, an action contrary to the person's
sincerely held religious exercise (2) under substantial pressure to
comply. Hobby Lobby, 573 U.S. at 720-24; Sherbert, 374 U.S. at 405-06.
For the first element, the believer's sincerely held religious
understanding determines the scope of the religious exercise and
whether compliance violates that exercise. This applies with full force
to compliance that would make an organization complicit in the activity
of others that it believes would violate its religious exercise, just
as it would apply to compliance that would make the organization
undertake such action directly. Little Sisters of the Poor Saints Peter
& Paul Home, 140 S. Ct. 2367, 2383-84 (2020) (``Little Sisters'');
Hobby Lobby, 573 U.S. at 723-25. A Catholic women's shelter, for
example, might sincerely believe that referring a prospective client to
another organization that provides birth control or abortions would
render the Catholic shelter complicit in grave sin.
The Agencies thus disagree with the commenters who relied on the
contrary attenuation theory. Under that theory, a religious believer or
organization cannot be substantially burdened by ``what follows from''
the required conduct, including when the organization's action triggers
activity by others that ultimately violates the organization's
religious exercise. The Supreme Court has repeatedly rejected this
view. In Little Sisters, the Supreme Court said that Federal agencies
``must accept the sincerely held complicity-based objections of
religious entities.'' 140 S. Ct. at 2383. In Hobby Lobby, the Supreme
Court rejected the argument that a complicity-based objection was
``simply too attenuated.'' 573 U.S. at 723. The Supreme Court stated
that ``federal courts have no business addressing whether the religious
belief asserted in a RFRA case is reasonable.'' Id. at 724.\41\ ``Where
to draw the line in a chain of causation that leads to objectionable
conduct is a difficult moral question, and our cases have made it clear
that courts cannot override the sincere religious beliefs of an
objecting party on that question.'' Little Sisters, 140 S. Ct. at 2391
(Alito, J., concurring).
---------------------------------------------------------------------------
\41\ See also Thomas, 450 U.S. at 715 (crediting Jehovah's
Witness who objected that making tank turrets would be participating
in war in violation of his sincere religious exercise, even though
he was willing to make raw materials for the tanks).
---------------------------------------------------------------------------
Although the Agencies do not identify here any religion with such a
complicity-based objection to the notice-and-referral requirements, the
Agencies cannot rule out the possibility. Many religions sincerely
believe that complicity in certain actions they consider immoral is
similar (morally speaking) to committing the underlying action itself.
The Agencies cannot agree with comments that a complicity-based
objection to a referral is not ``truly'' religious, or that such an
objection cannot be sincerely held.\42\ No principle articulated in
Little Sisters, Hobby Lobby, Thomas or any other relevant Supreme Court
decision precludes the possibility that the notice-and-referral
requirements could on this basis give rise to a substantial burden on
the exercise of religion.
---------------------------------------------------------------------------
\42\ See, e.g., United States v. Ballard, 322 U.S. 78, 87 (1944)
(Under the Constitution, ``[m]an's relation to his God was made no
concern of the state. He was granted the right to worship as he
pleased and to answer to no man for the verity of his religious
views.'').
---------------------------------------------------------------------------
For the second element of what constitutes a ``substantial
burden,'' there are myriad ways that a law could exert substantial
pressure for a person or organization to abandon its religious beliefs.
As relevant here, it could constitute substantial pressure when the
Government conditions an organization's receipt of Federal funds to
administer a social service on taking actions that would contravene the
organization's religious beliefs. Such a condition would force the
organization ``to choose between the exercise of a First Amendment
right and participation in an otherwise available public program.''
\43\ In 1963, the Supreme Court held it was ``too late in the day to
doubt'' that this kind of conditional government benefit could
constitute a substantial burden on religious exercise.\44\ Thus, the
[[Page 82066]]
Department of Justice determined that RFRA was reasonably construed to
require an exemption from a requirement not to discriminate on the
basis of religion in employment under a Department-funded social
service program when the grantee sincerely believed that employment of
people who did not adhere to its core beliefs would undermine its
religious mission. See Application of the Religious Freedom Restoration
Act to the Award of a Grant Pursuant to the Juvenile Justice and
Delinquency Prevention Act, 31 Op. O.L.C. 162 (2007) (``World
Vision'').
---------------------------------------------------------------------------
\43\ Thomas, 450 U.S. at 716; see also id. at 717-18 (``Where
the state conditions receipt of an important benefit upon conduct
proscribed by a religious faith, or where it denies such a benefit
because of conduct mandated by religious belief, thereby putting
substantial pressure on an adherent to modify his behavior and to
violate his beliefs, a burden upon religion exists. While the
compulsion may be indirect, the infringement upon free exercise is
nonetheless substantial.'').
\44\ Sherbert v. Verner, 374 U.S. 398, 404 (1963); see 42 U.S.C.
2000bb(b) (``The purposes of this [Act] are--(1) to restore the
compelling interest test as set forth in Sherbert v. Verner, 374
U.S. 398 (1963) and Wisconsin v. Yoder, 406 U.S. 205 (1972) and to
guarantee its application in all cases where free exercise of
religion is substantially burdened; and (2) to provide a claim or
defense to persons whose religious exercise is substantially
burdened by government.'').
---------------------------------------------------------------------------
As mentioned above, some commenters argued that the notice-and-
referral requirements did not rise to the level of ``substantial
pressure on an adherent to modify his behavior and to violate [his]
beliefs,'' Kaemmerling, 553 F.3d at 678, or could not be said to
``bear[ ] direct, primary and fundamental responsibility for rendering
religious exercise effectively impracticable,'' C.L.U.B., 342 F.3d at
761. The burden, they contended, was at best de minimis. In Kaemmerling
and C.L.U.B., however, the conditions for participating in a government
benefit program were not at issue. C.L.U.B. arose in the land-use
context. Further, C.L.U.B. required the land-use regulation to burden
``a central tenet'' of the believer's faith, 342 F.3d at 761, which is
contrary to the definition of ``religious exercise'' in both RLUIPA and
RFRA, see 42 U.S.C. 2000cc-5(7)(A); id. 2000bb-2(4). The Seventh
Circuit has also abandoned the ``effectively impracticable'' standard
from C.L.U.B., recognizing that Hobby Lobby and a more recent RLUIPA
case, Holt v. Hobbs, 574 U.S. 352 (2015), ``articulate[d] a standard
much easier to satisfy'' than the ``effectively impracticable''
standard. Jones v. Carter, 915 F.3d 1147, 1149 (7th Cir. 2019)
(citation omitted).
The notice-and-referral requirements, imposed as conditions for
receiving grants to carry out social services, could place substantial
pressure on faith-based organizations to abandon or modify their
beliefs. The grants under the programs covered by the rule were
otherwise generally available on a religion-neutral basis to qualifying
entities. It does not matter whether the organization could choose not
to accept the grant.\45\ What would make the burden on religious
exercise ``substantial'' is the pressure from the inability to acquire
that Federal funding. An organization might in those circumstances feel
compelled either to bend its beliefs or forgo the Federal funding
altogether. It is irrelevant that the organization might be able to
practice its religion in other ways. See, e.g., Holt, 574 U.S. at 361-
62 (rejecting the argument that alternative forms of religious exercise
are relevant to the substantial burden analysis); see also Attorney
General Memorandum, Principles 4 and 10.
---------------------------------------------------------------------------
\45\ Thomas, 450 U.S. at 716 (``[A] person may not be compelled
to choose between the exercise of a First Amendment right and
participation in an otherwise available public program.'');
Sherbert, 374 U.S. at 412 (Douglas, J., concurring) (This inquiry
``turns not on the degree of injury, which may indeed be nonexistent
by ordinary standards. The harm is the interference with the
individual's scruples or conscience--an important area of privacy
which the First Amendment fences off from government.'').
---------------------------------------------------------------------------
The Agencies also disagree with the commenters who contended that
countervailing interests, such as the benefit of providing notices and
referrals to beneficiaries of the social service program, would
ameliorate any substantial burden imposed by those requirements on an
organization's religious exercise. Countervailing interests are
relevant to the next stage of the inquiry: Whether the Government has a
compelling interest that might justify the imposition of a substantial
burden on the recipient of a grant. See, e.g., United States v. Lee,
455 U.S. 252, 257-58 (1982) (finding a burden sufficient to reach
strict scrutiny and only then considering the impact on third parties).
For all of these reasons, the Agencies recognize the possibility
that the alternative provider notice-and-referral requirements would
impose a substantial burden on faith-based organizations with sincerely
held complicity-based objections to those requirements. The Agencies
are obligated to ``overtly consider'' this possibility when
promulgating rules that raise concerns regarding ``the sincerely held
complicity-based objections of religious entities.'' Little Sisters,
140 S. Ct. at 2383. Failure to consider it could make the Agencies
``susceptible to claims that the rules were arbitrary and capricious
for failing to consider an important aspect of the problem.'' Id. at
2384. Supreme Court precedent does not require the Agencies to
determine conclusively that a regulation would always impose a
substantial burden in order for the Agencies to address such concerns
proactively, as explained further in Part II.C.3.d. It is consistent
with--though not required by--the fact- and context-specific nature of
RFRA for the Agencies to decline to state definitively whether the
notice-and-referral requirements constitute a substantial burden in
this context, and instead to promulgate a prophylactic rule that avoids
the imposition of any burden that, for reasons discussed in the next
section, do not seem justified by a compelling interest.
Changes: None.
Affected Regulations: None.
c. Compelling Interests
Summary of Comments: Some commenters agreed with the Agencies that
the lack of evidence of actual instances of a beneficiary's seeking a
referral under the 2016 rule undermined any compelling interest--under
both the Free Exercise Clause and RFRA--in imposing the notice-and-
referral requirements. See 85 FR at 2891 (DHS); id. at 2900 (USDA); id.
at 2923 (DOJ); id.at 2931 (DOL); id. at 2940 (VA); id. at 2977 (HHS);
id. at 3194 (ED). A national religious organization confirmed that it
was also not aware of any instance of a referral request. Other
commenters, however, argued that the Agencies did not have adequate
documentation to prove that beneficiaries were not seeking referrals
because the Agencies were not tracking successful referral requests.
They claimed that the Agencies' inadequate documentation could not
prove that the Government lacked a compelling interest and thus did not
meet the Agencies' burden to justify removing the notice-and-referral
requirements, making this proposed rule arbitrary and capricious. Other
commenters similarly argued that the Agencies had not conducted a
thorough analysis of the frequency with which beneficiaries requested
referrals.
One organization claimed that, under the existing regulations, it
and similar organizations had received complaints from nonreligious
beneficiaries claiming that religious providers were denying them
services or violating their religious freedom. In its comment to HUD,
this commenter said it had found an alternative provider for a
beneficiary who had contacted the organization to find an alternative
to a 12-step program in a Medicaid-funded emergency shelter
administered by a faith-based organization. The commenter argued that
such programs were pervasively religious, based on Inouye v. Kemna, 504
F.3d 705 (9th Cir. 2007), and Hazle v. Crofoot, 727 F.3d 983 (9th Cir.
2013), and claimed that another secular organization had regularly
received similar complaints from shelter residents.
One commenter also argued that HHS and the other Agencies were not
entitled to remove the notice-and-referral requirements based on HHS's
experience with the notice-and-referral
[[Page 82067]]
requirement in the SAMHSA programs. Under those requirements,
participating faith-based organizations must report all referrals, see
85 FR 2984, but to date the Agency has received no such report. The
commenter stated that the Agencies should not generalize from this
experience to all of the programs affected by this final rule without
conducting a rigorous statistical analysis of the Agencies' programs
more broadly. Additionally, some commenters argued that there was
tension in claiming that the notice-and-referral requirements imposed a
substantial burden while denying that a compelling interest exists due
to the absence of beneficiaries seeking referrals.
Some commenters contended that the notice-and-referral requirements
would survive strict scrutiny because they furthered some combination
of the compelling government interests in (1) protecting third-party
beneficiaries' religious liberty and (2) providing critical services
effectively to millions of vulnerable people. The commenters argued
that these interests outweighed the burdens on faith-based
organizations.
Regarding the first putative interest, commenters argued that the
notice-and-referral requirements served a compelling interest in
protecting beneficiaries' fundamental religious liberty. They contended
that this interest outweighed any burden on faith-based organizations,
which as previously noted they variously characterized as ``de
minimis,'' as imposing only ``minor costs,'' or as only a ``minimal
imposition.'' See Part II.K.1 (Regulatory Impact Analysis). They
reasoned that the burden imposed on faith-based organizations to comply
with these requirements was not ``undue'' when weighed against the
benefit of informing beneficiaries of their religious rights, as the
2016 final rule concluded. They also said the cost to providers of
notice and referral was minimal compared to the cost to beneficiaries
of seeking out alternative service providers. See id.
The second interest was presented with some variations. Some
commenters said the interest was in ensuring that federally funded
social-services programs effectively serve the vulnerable populations
that the programs were created to help. Others said the interest was in
ensuring that no unnecessary obstacles would prevent beneficiaries from
receiving needed services.
Response: Although they do not dismiss the argument out of hand,
the Agencies do not believe it to be clear that the notice-and-referral
requirements would serve any compelling interest, let alone that they
would do so in the particularized way required by RFRA. Under that
statute, the burden is not on the Government to disprove the existence
of a compelling interest. Rather, assuming that a social service
provider could show that the notice-and-referral requirements imposed a
substantial burden on its religious exercise, the burden would shift to
the Government to prove that a compelling interest exists. ``Only the
gravest abuses, endangering paramount interests'' could ``give
occasion'' to satisfy this test. Sherbert, 374 U.S. at 406; see also
Yoder, 406 U.S. at 215 (``[O]nly those interests of the highest order
and those not otherwise served can overbalance legitimate claims to the
free exercise of religion.''). Additionally, to demonstrate a
compelling interest under RFRA, the Agencies would need to show that
their interest was compelling with regard to the application of these
requirements ``to the person'' affected. 42 U.S.C. 2000bb-1(b). This
``rigorous standard'' requires a particularized showing. See, e.g.,
Holt, 574 U.S. at 363-64; Gonzales v. O Centro Espirita Beneficente
Uniao Do Vegetal, 546 U.S. 418, 431-32 (2006). For example, Congress's
determination that an illegal hallucinogen was exceptionally dangerous
with no medical use and a high risk of abuse was not sufficient to show
a compelling interest in applying that ban to a specific religious use
in Gonzales. 546 U.S. at 432-34. It is not clear that either putative
compelling interest cited by commenters could meet these standards.
While the Agencies recognize that protecting the religious liberty
of third-party beneficiaries can be compelling, they do not believe it
is clear that the notice-and-referral requirements were always
protecting beneficiaries' religious liberties. See Part II.C.1. The
referral requirement enabled objections based on feelings of
discomfort, dislike, and even rank prejudice against particular
religious groups for providing social services that the rule required,
and will still require, to be free of any religious content.
Furthermore, the rule required, and still requires, a social service
provider to keep any religious activities that it conducts with its own
funds separate in time or place from the Government-funded program, and
to ensure that beneficiary participation in such activities is
voluntary. If, in a particular case, the environment in which a
religious provider delivered a federally funded social service was so
overwhelming as to actually infringe on a beneficiary's religious
liberty, the Agency or its intermediary could be required by RFRA to
make an appropriate accommodation, which might include referring the
beneficiary elsewhere. As discussed more below, the Agencies believe
from their experience that this circumstance is sufficiently rare that
it does not warrant imposing a potentially burdensome, possibly
stigmatizing, across-the-board rule on all religious providers. It is
within the Agencies' legal and policy discretion to address any such
concern as the case arises.
For at least three reasons, it is not clear that the notice-and-
referral requirements furthered a compelling interest in providing
services effectively to vulnerable beneficiaries. First, the notice-
and-referral requirements addressed a problem that rarely arises.
Second, the notice-and-referral requirements did not apply to many
organizations. Third, with occasional exceptions for specific programs,
Congress itself has not applied these requirements to the Agencies.
Under the prior rule, religious social service providers were
permitted to fulfill their referral obligation by making referrals to
non-federally funded providers, which the Government could not have
ensured were providing the services in a manner as effective as the
programs it was funding. And, as discussed above and in the paragraphs
that follow, there is no indication that any individual beneficiary
actually sought a referral. To be compelling, an interest must have a
``high degree of necessity,'' Brown v. Entm't Merchs. Ass'n, 564 U.S.
786, 804 (2011), which means there must be ``an `actual problem' in
need of solving, and the curtailment of [the right] must be actually
necessary to the solution.'' Id. at 799 (citation omitted); Korte v.
Sebelius, 735 F.3d 654, 685 (7th Cir. 2013) (applying this test to
RFRA); see also Sherbert, 374 U.S. at 403 (the regulated conduct must
``pose[ ] some substantial threat to public safety, peace[,] or
order''). The same is true with regard to the First Amendment, to the
extent strict scrutiny applies, as discussed in Part II.F below.
Seven of the eight Agencies said in their 2020 NPRMs that they were
not aware of any circumstance in which a beneficiary ``actually sought
an alternative provider'' since the requirement went into effect in
2016. See 85 FR at 2891 (DHS); id. at 2900 (USDA); id. at 2923 (DOJ);
id. at 2931 (DOL); id. at 2940 (VA); id. at 2977 (HHS); id. at 3194
(ED). All eight Agencies now confirm that they are not aware of any
such referrals, based on their experiences while the notice-and-
[[Page 82068]]
referral requirements were in effect. The Agencies' employees who have
administered and provided legal support to the relevant programs
throughout this time period confirmed that they were not aware of any
such referral requests. For example, VA's Supportive Services for
Veteran Families program has not received a single request or concern
from a beneficiary of any provider--faith-based or not--seeking an
alternative provider. And, in VA's review of records, it found no
record of a single report or referral indicating that any beneficiary
requested a referral under the prior rule. Cf. 81 FR 19368 (discussing
recordkeeping and reporting requirements). Similarly, while preparing
this final rule, HUD confirmed that it was not aware of any faith-based
organization that had reported a request for a referral.
The Agencies' experience is consistent with SAMHSA's. As the
Agencies recognized when promulgating the 2016 final rule, that program
requires all referrals to be reported. The Agencies said that HHS had
received no reports of referrals in the SAMHSA programs, so ``the
Agencies believe[d] that the number of requests for referrals [would]
be minimal.'' 81 FR 19366. In its January 2020 NPRM, HHS reaffirmed
that no referrals had been reported for the SAMHSA programs and that
``few if any referrals have been requested'' in the other programs to
which the 2016 rule applied. 85 FR at 2984. HHS reaffirms that there
have been no reported referral requests in the SAMHSA programs. As they
did in 2016, the Agencies believe that the SAMHSA experience is
relevant. It is a helpful data point because all referrals must be
reported, and those regulations have been in place since 2003.
Furthermore, although the Agencies have said multiple times in the
public record--in the 2016 final rule and the 2020 NPRMs--that
referrals were rarely or never used, not one comment (among the more
than 95,000 public comments received) cited or described an actual
instance of a referral requested under the rule. In fact, the only
comment on actual practice connected to the prior rule was from a
national faith-based organization that said it had not experienced any
such referral request. Another commenter referred to a practice of
beneficiaries' calling like-minded organizations for referrals, but
these referrals seem to have occurred outside the context of the
referral requirement at issue here. There is no indication that the
beneficiaries seeking these referrals had previously sought services
from a faith-based provider receiving direct Federal financial
assistance or that they had sought referrals from such providers. If
anything, the comment demonstrated that unofficial or non-government-
imposed processes were sufficient for beneficiaries to obtain
referrals, without the need to impose the burden on faith-based
organizations. As discussed in Part II.C, it also makes sense that
beneficiaries who will not accept benefits from a faith-based
organization would seek a referral from an organization that they do
not find objectionable, rather than the one to which they objected.
For all of these reasons, the Agencies have a sufficient basis to
conclude that referrals were rarely (if ever) sought under the notice-
and-referral requirements. That conclusion diminishes the Government's
interest in these requirements because it shows that, in practice,
these requirements have turned out to be merely symbolic, which would
mean they ``cannot suffice to abrogate'' religious liberty. Smith, 494
U.S. at 911 (Blackmun, J., dissenting) (applying the standard that was
restored by RFRA).
The Agencies disagree that this conclusion is in tension with their
finding that complying with the notice-and-referral requirements could
impose a substantial burden. To be clear, the Agencies are not saying
that the notice-and-referral requirements always and in every case
posed a substantial burden on the religious exercise of faith-based
organizations or categorically violated RFRA. As explained in Part
II.C.3.b, conditioning a benefit on a faith-based organization's
willingness to give a notice or a referral could exert substantial
pressure to forgo complicity-based beliefs. That is true even if no
beneficiary ultimately seeks a referral, but the Agencies recognize
that not all faith-based organizations necessarily share such beliefs
or face that difficult choice. The Agencies nevertheless do not see the
need to create even the prospect of such a choice, and force potential
applicants to rely on obtaining case-specific exemptions under RFRA,
given that the need for imposing the notice-and-referral requirements
is slight. Some otherwise-qualified organizations might simply decline
to apply for a grant, for fear that the Government would not grant them
the exemption when the need arises. The Agencies wish to avoid that
chilling effect.
Additionally, secular organizations were exempt from the notice-
and-referral requirements despite similar risks of harm to the
allegedly compelling interests in protecting beneficiaries from
discrimination and receiving a social service in an environment that
made them uncomfortable. The notice-and-referral requirements also did
not apply to any USAID programs, or to USDA's school lunch program,
even though that program otherwise met the definition of ``direct
Federal financial assistance.'' 81 FR at 19381; see also id. at 19413-
14 (sections 16.4(a), (g), (h)). The notice requirement did not apply
to any faith-based organizations receiving indirect Federal financial
assistance, nor did the referral requirement, except for organizations
receiving indirect aid from VA or HHS. As discussed in Part II.C, those
providers posed the same supposed risks of harm to beneficiaries'
religious liberty protections and receipt of services. See Espinoza,
140 S. Ct. at 2261 (proffered interest in promoting public schools was
undermined because secular private schools would have the same impact,
yet could receive funding). A law does not serve a compelling interest
when it exempts conduct that would serve the ``supposedly vital
interest.'' Lukumi, 508 U.S. at 547 (citation omitted); Gonzales, 546
U.S. at 433 (citation omitted).
Moreover, Congress itself did not see fit to impose notice-and-
referral requirements in most of the social service programs covered by
this rule, whereas it did in the Charitable Choice statutes that apply
to the SAMHSA and TANF programs. See 42 U.S.C. 290kk-1(f)(1); id.
604a(e); id. 300x-65(e)(1). As the 2016 final rule recognized, the
applicable Charitable Choice statutes ``govern[ ]'' and ``take
precedence over these regulations,'' and ``the Government will continue
to bear the full burden of making referrals as specified in those
statutes.'' 81 FR at 19366. That remains true today and will continue
to remain true after this final rule takes effect. Congress's decision
to impose the referral requirement only in the Charitable Choice
statutes undercuts the interest in imposing the referral requirements
on faith-based organizations in the programs governed by this final
rule. ``[I]t was Congress, not the Departments, that declined to
expressly require'' notice and referral here and ``that has failed to
provide the protection'' that the commenters seek. Little Sisters, 140
S. Ct. at 2382.
In short, the Agencies conclude that they have insufficient
evidence to determine that imposing the notice-and-referral
requirements on all religious social service providers would in all
cases serve a compelling government interest.
Changes: None.
[[Page 82069]]
Affected Regulations: None.
d. Least Restrictive Means and Appropriate Remedy
Summary of Comments: Some commenters argued that striking the
notice-and-referral requirements was the appropriate remedy for the
tension with the Free Exercise Clause and RFRA, including because there
was little indication that these requirements would be necessary for
either faith-based or secular providers. For example, an organization
representing over 720 schools commented that barriers to participation,
like referral requirements, should be removed for all providers. That
commenter added that removing this requirement was ``crucial'' to
protect religious freedom and ensure that religious organizations could
continue working to improve society.
Some commenters argued, however, that the notice-and-referral
requirements should not be altered because they were narrowly tailored
to the interests discussed in Part II.C.3.c above. They said that the
requirements were narrowly tailored because they imposed minimal costs
and required only ``reasonable efforts'' to find another provider for a
beneficiary who requested one.
Some commenters argued generally that the Agencies should provide
substitute mechanisms to ensure that beneficiaries are aware of their
rights and can receive services from a nonreligious provider.
Commenters also argued that the Agencies should provide evidence about
what alternative, reliable mechanisms exist. Several commenters argued
that the Agencies were instead required by RFRA to conduct a fact-
specific inquiry on a case-by-case basis and not to impose broader
exemptions or changes of policy. These commenters relied on California,
941 F.3d at 427-28; Real Alternatives, Inc. v. Sec'y of Health & Human
Servs., 867 F.3d 338, 358 & n.23 (3d Cir. 2017); and EEOC v. R.G. &
G.R. Harris Funeral Homes, Inc., 884 F.3d 560, 588 (6th Cir. 2018),
aff'd on other grounds, Bostock v. Clayton Cty., 140 S. Ct. 1731
(2020).
Commenters suggested four potential regulatory alternatives that
they believed would be less restrictive than removing the requirements
altogether. First, several commenters argued that it would be less
restrictive for the Agencies to expand these notice-and-referral
requirements to secular providers. Some argued that this
``modification'' would achieve equal treatment of religious and secular
organizations, including to remove any stigma, without eliminating the
beneficiary protections. Some commenters noted that HHS's NPRM said
this was the ``clearest alternative approach.'' 85 FR at 2984. These
commenters stated that notice-and-referral requirements could properly
be developed and tailored for the parallel issues that beneficiaries
would likely encounter with secular providers. Some of these commenters
argued that secular organizations already receiving Federal funding
could easily absorb the de minimis burden of such notice-and-referral
requirements. Another commenter, however, said that expanding these
requirements to secular organizations would be ``on its face . . .
ridiculous'' because these measures were meant to prevent religious
coercion and, by definition, such organizations would be incapable of
religious coercion.
Second, multiple commenters suggested that it would be less
restrictive for the Government or an intermediary to provide the notice
and make the referrals, which would remove the burden from faith-based
organizations while preserving the benefit for beneficiaries.
Commenters added that this would be consistent with the Charitable
Choice statutes and how such provisions operated before the 2016 rule.
Multiple commenters contended that Government control would improve
administration and safeguards of stakeholders' rights and that the
Agencies would have superior knowledge of which other providers in the
area were also being funded and would be able to provide the services
being sought. Commenters also contended that, because the Agencies
asserted that few referrals had been requested to date, there would be
minimal burden on the Government to respond to such referrals.
Third, multiple commenters suggested combining the first two
alternatives by having the Government provide the notice and referral
for all providers. These commenters argued that this alternative would
eliminate the alleged status-based discrimination while expanding the
supposed benefits of the rule.
Fourth, an advocacy organization suggested that the Agencies could
also consider allowing individual requests for exemptions to the
notice-and-referral requirements.
Response: The Agencies agree with the commenters who said that the
Agencies can and should remedy the tension with Trinity Lutheran and
RFRA by striking the notice-and-referral requirements. If there is no
compelling interest, then there is also no need to analyze the least
restrictive means to achieve that interest.\46\ Even assuming the
notice-and-referral requirements served a compelling government
interest, it is not clear that any of the alternatives proposed by
commenters would qualify as the least restrictive means of furthering
any of the interests discussed above. ``An infringement of First
Amendment rights,'' assuming there is one, ``cannot be justified by a
State's alternative view that the infringement advances religious
liberty.'' Espinoza, 140 S. Ct. at 2260. The Supreme Court has held
that the least restrictive means is an ``exceptionally demanding''
standard. Hobby Lobby, 573 U.S. at 728. To meet this standard, an
agency must ``sho[w] that it lacks other means of achieving its desired
goal without imposing a substantial burden on the exercise of
religion.'' Id. But an alternative is less restrictive only when it
would both further the compelling interest as effectively as the
existing requirement and alleviate the burden that triggered strict
scrutiny.\47\
---------------------------------------------------------------------------
\46\ See, e.g., Gonzales, 546 U.S. at 429 (``[T]he Government
failed on the first prong of the compelling interest test, and did
not reach the least restrictive means prong.''); see also World
Vision, 31 Op. O.L.C. at 184 (not addressing least restrictive means
because compelling interest was not satisfied).
\47\ See, e.g., Hobby Lobby, 573 U.S. at 731 (holding the
accommodation was a less restrictive means for those plaintiffs
because ``it does not impinge on the plaintiffs' religious belief
that providing insurance coverage for the contraceptives at issue
here violates their religion, and it serves HHS's stated interests
equally well'').
---------------------------------------------------------------------------
First, it is unclear that extending the notice-and-referral
requirements to secular providers would be a less restrictive means.
The Agencies agree that this may be the clearest way to achieve equal
treatment under Trinity Lutheran and that costs to individual secular
providers would likely be minimal, as they are for individual faith-
based providers. But it would not alleviate the tension with RFRA. See,
e.g., Hobby Lobby, 573 U.S. at 728 (a less restrictive means achieves
the compelling interest ``without imposing a substantial burden'').
Applying these requirements to all providers would extend any potential
substantial burden to faith-based organizations that were exempt from
these requirements under the 2016 final rule. Additionally, as
explained in ED's NPRM, the Agencies do not want to affect
beneficiaries' receipt of secular services when no religious
alternative is available and do not want to impose burdens on any
secular organizations that oppose referrals to religious alternatives.
85 FR 3194. Also, beneficiaries have access to public information
regarding potential
[[Page 82070]]
secular or religious alternatives. Id.; see also Part II.C.2.a
(describing and citing examples of public information).
Second, it is not clear that it is a less restrictive means for the
Agencies or their intermediaries to assume responsibility to provide
the notices and referrals. The Agencies agree that this might alleviate
the potential substantial burden under RFRA--assuming the faith-based
provider was not involved in a way that raised complicity-based
objections--while preserving whatever benefit inures to beneficiaries.
But it would retain the tension with Trinity Lutheran because these
requirements would continue applying solely to faith-based
organizations based on their religious character. Additionally,
requiring Government entities to handle such referrals raises
additional problems, such as assessing the religious character of the
alternatives in order to make appropriate referrals. It is also unclear
that the Agencies would have uniquely helpful information to make
referrals. Many of the Agencies' programs have thousands of
participants that are funded by intermediaries. The Agencies will not
necessarily know what providers are funded in any given area. For other
programs, the Agencies or other stakeholders have helpful publicly
available resources that list the alternative providers and are easily
accessible to beneficiaries, as discussed in Part II.C.2.a above.
Although few or no referrals have been requested under the prior rule,
the Agencies would still bear burdens to implement across all of these
programs notice and referral systems that would be accessible and
available to all in compliance with all other applicable Federal laws.
Third, the Agencies recognize that the combined alternative
proposal--extending these notice-and-referral requirements to secular
organizations and requiring the Government or its intermediary to
assume the responsibility to carry them out--could alleviate the
tension with both Trinity Lutheran and RFRA. But it would have to avoid
involving faith-based organizations in ways that would elicit
complicity-based objections, which it is not clear can be accomplished.
Even if that could be accomplished, the Agencies would still exercise
their discretion not to impose that combined alternative proposal for
all of the other reasons discussed regarding the individual proposals.
Fourth, the Agencies do not believe it is a less restrictive means
to retain a rarely invoked rule and require objecting faith-based
organizations instead to make individual requests for exemptions under
RFRA. Such a regime still shifts the burden to the organization to
demonstrate that the possibility of having to make a referral would
affect its religious exercise. The remedy of requiring all faith-based
organizations to follow the rule and request individualized exemptions
when necessary would not be narrowly tailored to serve a government
interest that is speculative at best.
In any event, the Agencies elect to exercise their discretion to
remove the notice-and-referral requirements rather than implement these
alternatives, for all of the reasons discussed throughout this section.
The Agencies have discretion to determine how to alleviate the tension
with the Free Exercise Clause. Removing these requirements is well
within the Agencies' discretion of ``room for play in the joints'' to
decide how to fashion appropriate religious accommodations and
exemptions. Walz v. Tax Comm'n of City of New York, 397 U.S. 664, 669
(1970); Texas Monthly, Inc. v. Bullock, 489 U.S. 1, 18 n.8 (1989)
(Establishment Clause allows regulatory exemptions beyond those
required by Free Exercise Clause). This is especially so given
uncertainty about whether the Government even has a compelling interest
in applying the notice-and-referral requirements. And it is also within
the Agencies' discretion to avoid serious constitutional issues and the
burdens of related litigation. Cf. DeBartolo, 485 U.S. at 575.
The Agencies have similar discretion under RFRA and disagree with
the comments that RFRA does not allow them to change a regulation to
eliminate a requirement that potentially burdens the exercise of
religion. See Little Sisters, 140 S. Ct. at 2383-84. Instead, the
Agencies believe that they have discretion to determine how to avoid
potential or actual RFRA violations, including discretion to determine
whether to impose a categorical rule or address concerns on a case-by-
case basis. RFRA directs the ``[g]overnment'' to comply with its terms,
42 U.S.C. 2000bb-1(a) to (b), with regard to ``the implementation'' of
``all Federal law.'' 42 U.S.C. 2000bb-2(a). When an Agency determines
that its mode of implementing Federal law might in certain cases burden
an organization's exercise of religion, the Agency has discretion to
modify its implementation to avoid any violations of RFRA. That is
consistent with the executive branch's responsibility to ``take
[c]are'' that the [l]aws be faithfully executed.'' U.S. Const. art. II,
sec. 3.
That is also consistent with the most recent Supreme Court
decisions on these issues. In Little Sisters, the Court held that
agencies must consider sincere complicity-based objections when
promulgating rules and that failure to do so can make the rule
arbitrary and capricious. 140 S. Ct. at 2383-84. Several Justices
separately ``appear[ed] to agree'' that a regulatory agency has
``authority under RFRA to `cure' any RFRA violations caused by its
regulations.'' Id. at 2382 n.11.\48\ Indeed, Justice Ginsburg
recognized that ``[n]o party argues that agencies can act to cure
violations of RFRA only after a court has found a RFRA violation, and
this opinion does not adopt any such view.'' Id. at 2407 n.17
(Ginsburg, J., dissenting).
---------------------------------------------------------------------------
\48\ See also id. at 2395 (Alito, J., concurring) (``Once it is
recognized that the prior accommodation violated RFRA in some of its
applications, it was incumbent on the Departments to eliminate those
violations, and they had discretion in crafting what they regarded
as the best solution.''); id. at 2400 (Kagan, J., concurring in the
judgment) (those agencies ``have wide latitude over exemptions, so
long as they satisfy the requirements of reasoned decisionmaking'');
id. at 2407 (Ginsburg, J., dissenting) (``The parties here agree
that federal agencies may craft accommodations and exemptions to
cure violations of RFRA.'' (citations and footnote omitted)).
---------------------------------------------------------------------------
RFRA would be unworkable if it did not permit accommodations beyond
what it affirmatively required. Under such a rule, the Agencies would
have to guess the exact accommodation that courts would approve. A
little less accommodation than necessary would violate RFRA. A little
more accommodation than necessary would exceed the Agency's authority.
That cannot be the standard, especially when the Government has
traditionally been granted ``room for play in the joints'' to decide
the scope of religious accommodations under both the First Amendment
and RFRA. Walz, 397 U.S. at 669.\49\ That would also be inconsistent
with the Supreme Court's recent reaffirmation that ``RFRA `provide[s]
very broad protection for religious liberty,' '' Little Sisters, 140 S.
Ct. at 2483 (quoting Hobby Lobby, 573 U.S. at 693 (alteration in
original)), and with the definition of ``religious exercise'' in RFRA
and RLUIPA that Congress mandated ``be construed in favor of a broad
protection of religious exercise, to the maximum extent permitted by
the terms of this chapter and the Constitution.'' 42 U.S.C. 2000cc-3(g)
(RLUIPA); id. 2000bb-2(4) (RFRA); Hobby Lobby, 573 U.S. at 696 & n.5.
RFRA empowers courts to provide relief when the Government has exceeded
RFRA's bounds. 42 U.S.C. 2000bb-1(c). But nothing in RFRA requires the
Government to implement
[[Page 82071]]
or maintain regulations that go right up to the line of what courts
would find acceptable.
---------------------------------------------------------------------------
\49\ See also World Vision, 31 Op. O.LC. at 168; Texas Monthly,
489 U.S. at 18 n.8 (Establishment Clause allows regulatory
exemptions beyond those required by the Free Exercise Clause).
---------------------------------------------------------------------------
Moreover, RFRA and the Agencies' organic statutes do not
``prescribe the remedy by which the government must eliminate'' a
substantial burden. 83 FR 57545. The Agencies' choice to remove the
notice-and-referral requirements is reasonable given the legal
uncertainty as to whether those requirements might in some cases
violate RFRA.\50\ When it has found that a regulation violated RFRA,
the Supreme Court has let the regulatory agency determine the correct
remedy.\51\ The same should be true for potential violations. As a
result, the Agencies have discretion to determine the appropriate
accommodation. As Justice Alito recently explained, RFRA ``does not
require . . . that an accommodation of religious belief be narrowly
tailored to further a compelling interest. . . . Nothing in RFRA
requires that a violation be remedied by the narrowest permissible
corrective.'' Little Sisters, 140 S. Ct. at 2396 (Alito, J.,
concurring).
---------------------------------------------------------------------------
\50\ Cf. Ricci v. DeStefano, 557 U.S. 557, 585 (2009) (holding
an employer need only have a strong basis to believe that an
employment practice violates Title VII's disparate impact ban in
order to take certain types of remedial action that would otherwise
violate Title VII's disparate-treatment ban).
\51\ See, e.g., Hobby Lobby, 573 U.S. at 726, 731, 736; 79 FR at
51118 (2014) (proposed modification in light of Hobby Lobby); 80 FR
41324 (final rule explaining that ``[t]he Departments believe that
the definition adopted in these regulations complies with and goes
beyond what is required by RFRA and Hobby Lobby'').
---------------------------------------------------------------------------
Commenters rely on contrary cases from the United States Courts of
Appeals that preceded Little Sisters. But those cases cannot override
the rule in Little Sisters that the Agencies should consider potential
complicity-based objections. Indeed, one of those cases, the Ninth
Circuit's California v. Trump decision, was expressly vacated and
remanded in light of Little Sisters. See 140 S. Ct. 2367. The Third
Circuit's Real Alternatives decision did not address the scope of any
agency's regulatory discretion under RFRA, 867 F.3d 338, 358 & n.23,
and its reasoning was essential to Pennsylvania v. Trump, 930 F.3dat
573 & n.30, which Little Sisters reversed and remanded. Accordingly, in
light of Little Sisters, the Agencies do not believe that those cases
remain good law.
Additionally, the Agencies question the continued vitality of the
Sixth Circuit's decision regarding RFRA in Harris Funeral Homes. Most
significantly, the substantial-burden reasoning in Harris Funeral
Homes, which was relied on by some commenters, was based on the
attenuation theory from HHS Mandate cases, including Michigan Catholic
Conference. Harris Funeral Homes, 884 F.3d at 589-90, aff'd on other
grounds, Bostock v. Clayton Cnty., 140 S. Ct. 1731 (2020). As discussed
in Part II.C.3.b, the Supreme Court has expressly rejected that theory
as contrary to RFRA. Little Sisters, 140 S. Ct. at 2383; Hobby Lobby,
573 U.S. at 723-25; see also Little Sisters, 140 S. Ct. at 2389-91
(Alito, J., concurring). Removing the notice-and-referral requirements
is justified more directly by Little Sisters, Hobby Lobby, and the
other Supreme Court cases on which they rely. See also Part II.E
(further discussing Harris Funeral Homes).
In sum, the Agencies exercise their discretion to remove notice-
and-referral requirements because it is their position that doing so is
the appropriate administrative response to the Free Exercise Clause and
RFRA issues that those requirements created. In the Agencies' view,
eliminating these requirements is a more effective means of alleviating
the tension with the First Amendment and RFRA than the alternatives
proposed by commenters. This view is informed by the Agencies'
experience that they are not aware of any actual referral requests
under the prior rule. Also, eliminating the notice-and-referral
requirements avoids the potential for litigation that could burden and
delay the issuance of grants to eligible organizations. Moreover, the
Agencies are acting within their discretion because, as discussed in
Part II.C.1, ``it was Congress, not the Departments, that declined to
expressly require'' notice and referral in the vast majority of program
statutes that govern the Agencies here, and ``that has failed to
provide the protection'' for beneficiary objections to a provider's
religious exercise that the commenters seek. Little Sisters, 140 S. Ct.
at 2382.
Finally, the Agencies may provide information voluntarily to
beneficiaries as they deem appropriate within existing frameworks. For
example, DOL and VA noted in their NPRMs that they ``could supply
information to beneficiaries seeking an alternate provider'' when they
``make[ ] publicly available information about grant recipients that
provide benefits under its programs.'' 85 FR at 2931 (DOL), 2940 (VA).
The other Agencies agree that this is a possibility for some of the
programs that they fund. Under this final rule, the provision of such
information remains, as it has always been, an option but not a
requirement.
Changes: None.
Affected Regulations: None.
e. Third-Party Harms
Summary of Comments: Several commenters argued that the Free
Exercise Clause and RFRA cannot justify removing the notice-and-
referral requirements because of the potential impacts on
beneficiaries. These commenters argued that this change fails to
protect beneficiaries' interests based on a number of cases--Bd. of Ed.
of Kiryas Joel Village Sch. Dist. v. Grumet, 512 U.S. 687 (1994);
Estate of Thornton v. Caldor, 472 U.S. 703 (1985); Texas Monthly; Hobby
Lobby; and Cutter v. Wilkinson, 544 U.S. 709 (2005)--which held that
religious exemptions that can harm third parties implicate the
Establishment Clause. Some of these commenters argued that Hobby Lobby
assumed no burden on third parties and that any third-party harm
precludes a Government accommodation under the Free Exercise Clause or
RFRA. The Agencies incorporate the summary of such comments from Part
II.E.
These commenters argued that beneficiaries would be subject to the
third-party harms discussed in the comments summarized in Part II.C.2.
For example, some said that beneficiaries would not be able to make
informed decisions without knowledge of the religious character of the
service provider. Some claimed that removing the notice-and-referral
requirements would impose ``significant'' hardships on beneficiaries--
specifically, the costs of searching for alternative providers,
including ``potentially missing work, finding childcare, paying for
transportation, and visiting various other organizations.'' Commenters
also expressed concern that these burdens may be especially harmful to
the beneficiaries of programs designed to help those with limited
resources and facing poverty or other deprivations.
Finally, one commenter argued that this change in the final rule
would treat faith-based and secular organizations equally, which,
according to this commenter, violates the Establishment Clause.
Response: The Agencies disagree that removing the notice-and-
referral requirements will unlawfully or inappropriately burden third
parties.
Third-party burdens are part of the Establishment Clause analysis
but do not preclude accommodations or removal of beneficiary
protections. This is true even when the Free Exercise Clause does not
require the accommodation or exemption.\52\ Under
[[Page 82072]]
controlling Supreme Court precedent, the Establishment Clause allows
accommodations that remove a burden of government rules from religious
organizations, reduce the chilling effect on religious conduct, or
reduce government entanglement. See Corp. of Presiding Bishop of the
Church of Jesus Christ of Latter-day Saints v. Amos, 483 U.S. 327, 334-
39 (1987). Any third-party burdens that might result from such
accommodations are attributable to the organization that benefits from
the accommodation, not to the Government, and, as a result, do not
violate the Establishment Clause. Id. at 337 n.15. In the Sherbert line
of Free Exercise Clause cases that later became the basis of RFRA,
dissents and concurrences routinely pointed to such burdens on third
parties but did not persuade the majorities of any Establishment Clause
violation.\53\
---------------------------------------------------------------------------
\52\ See, e.g., Texas Monthly, 489 U.S. at 18 n.8; see also
Cutter, 544 U.S. at 713 (``[T]here is room for play in the joints
between the Free Exercise and Establishment Clauses, allowing the
government to accommodate religion beyond free exercise
requirements, without offense to the Establishment Clause.''
(internal quotation omitted)).
\53\ See, e.g., Thomas, 450 U.S. at 723 n.1 (Rehnquist, J.,
dissenting) (citing several burdens on the system and other
beneficiaries, including that ``[w]e could surely expect the State's
limited funds allotted for unemployment insurance to be quickly
depleted''); Yoder, 406 U.S. at 240 (White, J., concurring)
(outlining the State's legitimate interest in educating Amish
children, especially those who leave their community, but finding
the evidence of harm insufficient); id. at 245 (Douglas, J.,
dissenting) (arguing that the decision ``imperiled'' the ``future''
of the Amish children, not their parents).
---------------------------------------------------------------------------
The Supreme Court has applied this principle to allow
accommodations that litigants claimed caused significant third-party
harms. For example, the Supreme Court upheld the Title VII exemption
for religious employers--discussed in Part II.H--despite the alleged
significant harms of expressly permitting discrimination against
employees on the basis of religion. See Texas Monthly, 489 U.S. at 18
n.8 (citing Amos, 483 U.S. at 327).\54\ This is consistent with Hobby
Lobby, which expressly held that a burden lawfully may be removed from
a religious organization even if it allows such a religious objector to
withhold a benefit from third parties. Ultimately, government action
that removes such a benefit merely leaves the third party in the same
position in which it would have been had the Government not regulated
the religious objector in the first place. Otherwise, any accommodation
could be framed as burdening a third party. That would ``render[ ] RFRA
meaningless.'' Hobby Lobby, 573 U.S. at 729 n.37. ``[F]or example, the
Government could decide that all supermarkets must sell alcohol for the
convenience of customers (and thereby exclude Muslims with religious
objections from owning supermarkets), or it could decide that all
restaurants must remain open on Saturdays to give employees an
opportunity to earn tips (and thereby exclude Jews with religious
objections from owning restaurants).'' Id.; see also Attorney General's
Memorandum, Principle 15, 82 FR at 49670.
---------------------------------------------------------------------------
\54\ Hobby Lobby, 573 U.S. at 729 n.37 (``Nothing in the text of
RFRA or its basic purposes supports giving the Government an
entirely free hand to impose burdens on religious exercise so long
as those burdens confer a benefit on other individuals.'').
---------------------------------------------------------------------------
The Agencies are acting consistently with these principles here.
Removing the notice-and-referral requirements will not impose greater
burdens on third parties than the Title VII exemption that was upheld
in Amos.\55\ A beneficiary who does not receive notice or referral from
a faith-based direct aid recipient ``is not the victim of a burden
imposed by the rule''; rather, that person ``is simply not the
beneficiary of something that federal law does not provide.'' Little
Sisters, 140 S. Ct. at 2396 (Alito, J., concurring). The Agencies are
merely returning to a status quo that existed until 2016, that remains
for USAID funding recipients, and that has always existed for most
Agencies' indirect funding recipients. The Agencies have reasonably
concluded that removing the notice-and-referral requirements will not
unlawfully burden third parties.
---------------------------------------------------------------------------
\55\ See Amos, 483 U.S. at 337 n.15 (``Undoubtedly [the
employee's] freedom of choice in religious matters was impinged
upon'' by the church gymnasium's exemption from the religious
nondiscrimination requirement in Title VII'').
---------------------------------------------------------------------------
The other cases cited by commenters do not warrant a different
result. In those cases, the Supreme Court found Establishment Clause
violations because the law at issue both singled out a specific
religious practice or sect for special treatment and imposed
obligations without considering the impacts on third parties.\56\ But
the Agencies have assessed the burdens on third parties here, and the
Establishment Clause permits the Government to alleviate government-
imposed burdens on religious exercise through accommodations available
to all religions equally.\57\ As in Amos, this final rule alleviates
the Government-imposed burdens of the notice-and-referral requirements
and applies equally to all religious organizations. Indeed, removal of
the notice-and-referral requirements does not go as far as Amos did
when it provided an exemption to religious organizations from an
otherwise generally applicable law. Rather, the change in this final
rule ensures equal treatment of faith-based and secular organizations,
and it does not obligate or enable any grantee under the rule to impose
burdens on beneficiaries that did not exist before with respect to the
social service program in question.
---------------------------------------------------------------------------
\56\ Kiryas Joel, 512 U.S. at 706-07; Estate of Thornton, 472
U.S. at 709-10; see also Cutter, 544 U.S. at 722 (explaining that
the Court in Estate of Thornton ``struck down'' the statute at issue
``because it `unyieldingly weighted' the interests of Sabbatarians
`over all other interests' '' and required employers to privilege
employee requests for Sabbath accommodations (alterations omitted)).
\57\ See, e.g., Amos, 483 U.S. at 334-39; id. at 337 n.15
(distinguishing Estate of Thornton); cf. Hobbie v. Unemployment
Appeals Comm'n of Fla., 480 U.S.136, 145 n.11 (1987) (distinguishing
Estate of Thornton because the provision of unemployment benefits to
people fired for any religious reason ``does not single out a
particular class of such persons for favorable treatment and thereby
have the effect of implicitly endorsing a particular religion'');
see also Cutter, 544 U.S. at 720, 722, 724 (upholding RLUIPA under
the Establishment Clause despite alleged burdens).
---------------------------------------------------------------------------
Finally, the Agencies disagree that treating faith-based and
secular organizations on the same terms could violate the Establishment
Clause. To the contrary, the Supreme Court has ``repeatedly held that
the Establishment Clause is not offended when religious observers and
organizations benefit from neutral government programs.'' Espinoza, 140
S. Ct. at 2254 (citing Locke, 540 U.S. at 719, and Rosenberger, 515
U.S. at 839). Treating faith-based and secular organizations equally
under this rule does not violate the Establishment Clause.
Changes: None.
Affected Regulations: None.
D. Indirect Federal Financial Assistance
1. Definition of ``Indirect Federal Financial Assistance''
Existing regulations included in their definition of ``indirect
Federal financial assistance'' a requirement that beneficiaries have at
least one adequate secular option for use of the Federal financial
assistance. The notices of proposed rulemaking proposed to amend those
regulations to eliminate this secular alternative requirement.
a. Consistency With Zelman v. Simmons-Harris
Summary of Comments: Several commenters contended that eliminating
the secular alternative requirement would be inconsistent with the
Supreme Court's decision in Zelman v. Simmons-Harris, 536 U.S. 639
(2002). These commenters argued that Zelman and its predecessor cases
interpreted the Establishment Clause to require that voucher programs
include a secular option. Without secular options, these
[[Page 82073]]
commenters argued, beneficiaries cannot make a genuine and independent
private choice of a religious provider. According to these commenters,
that interpretation did not change in subsequent cases. Other
commenters contended that certain factors emphasized in the Zelman
decision do not make sense unless there exists at least one adequate
secular option. These commenters contended that, for the programs at
issue here, the proposed change will not guarantee that secular options
exist, unlike in Zelman where public school options were mandated.
Some commenters claimed that eliminating the alternative provider
requirement would undercut Zelman. These commenters also argued that--
combined with elimination of the written notice requirement, which,
according to these commenters, would allow religious service providers
to ``hide their religious character''--such a change would render
beneficiaries unable to ``engage in `true private choice' when the very
nature of that choice is hidden from them.''
Some of these commenters characterized the proposed change as
contrary to Zelman's requirement that indirect aid be neutral toward
religion. These commenters claimed that the proposed change would
effectively design programs in such a way that only religious providers
are available as options, and thus it would be the Government, not the
beneficiary, that is determining that the government aid reaches
inherently religious programs.
Other commenters questioned Zelman itself. Some commenters
contended that the Zelman decision was not unanimous and that it
conflicted with earlier Supreme Court precedent. Some characterized
Zelman as an ``already questionable rule.''
Other commenters, however, opined that eliminating the secular
alternative requirement would align with Zelman. Some of these
commenters observed that Zelman upheld the tuition-assistance program
that it reviewed because the program conferred assistance on a broad
class of individuals without reference to religion, and the Court
rejected an argument that the program was unconstitutional simply
because religiously affiliated schools received a majority of the
vouchers. These commenters further argued that, under Zelman, the
constitutionality of an indirect-aid program cannot turn on whether a
secular provider chooses to establish a location within the geographic
area of religious providers.
Response: The Agencies agree with commenters who observed that the
proposed elimination of the secular alternative requirement would be
consistent with Supreme Court precedent, and the Agencies disagree with
commenters who argued otherwise.
In Zelman, the Supreme Court rejected an Establishment Clause
challenge to a tuition-assistance program in which a large majority of
the participating schools were religious, and nearly all of the
beneficiaries chose to expend the aid on tuition at religious schools.
The Court observed that ``[a]ny private school, whether religious or
nonreligious,'' could participate in the program provided that it met
the program's religion-neutral criteria, 536 U.S. at 645, and it was
undisputed that the program ``was enacted for the valid secular purpose
of providing educational assistance to poor children in a demonstrably
failing public school system,'' id. at 649. The Court then summarized
its decisions as having held that ``where a government aid program is
neutral with respect to religion, and provides assistance directly to a
broad class of citizens who, in turn, direct government aid to
religious [providers] wholly as a result of their own genuine and
independent private choice, the program is not readily subject to
challenge under the Establishment Clause.'' Id. at 652.
The Court upheld the tuition-assistance program at issue in Zelman
because it was ``neutral in all respects toward religion''; it
``confer[red] educational assistance directly to a broad class of
individuals defined without reference to religion'' (i.e., parents of
schoolchildren); it ``permit[ted] the participation of all schools
within the district, religious or nonreligious''; and the Government
did nothing to ``skew the program toward religious schools'' because
the aid was ``allocated on the basis of neutral, secular criteria that
neither favor nor disfavor religion'' and was ``made available to both
religious and secular beneficiaries on a nondiscriminatory basis.'' Id.
at 653-54 (emphasis in original, internal quotation marks and
alteration omitted). The Supreme Court further reasoned that ``[a]ny
objective observer familiar with the full history and context of the .
. . program would reasonably view it as one aspect of a broader
undertaking to assist poor children in failed schools, not as an
endorsement of religious schooling in general.'' Id. at 655.
The indirect-aid programs covered by the modified definition in
this rulemaking will share these characteristics. They will be neutral
in all respects toward religion. They will allow organizations--both
faith-based and secular--to participate as service providers, so long
as they meet the programs' religion-neutral criteria. And they will
make aid available on the basis of secular, nondiscriminatory criteria
to religious and non-religious beneficiaries alike. Thus, the statutory
programs that meet the definition of ``indirect Federal financial
assistance'' as modified by this rulemaking will do nothing to skew the
programs toward religious providers or services toward religious
beneficiaries. To the extent the endorsement test still applies as it
did in Zelman, any reasonable observer familiar with such programs
would reasonably view them as efforts to provide assistance to the
program's beneficiaries, rather than as endorsements of religion. In
sum, the terms of the modified definition are consistent with, and do
not move these programs out of compliance with, Zelman.
Although the Zelman Court did note the availability of secular
schools in the program that it reviewed, id. at 655, it did not say
that secular options must be available in a given geographic area in
order for an indirect-aid program to satisfy the Establishment Clause.
Indeed, the Court specifically declined to rest its holding on the
geographically varying distribution of religious and secular schools.
As the Court explained, the distribution of religious and non-religious
schools ``did not arise as a result of the program,'' and resting its
holding on that distribution ``would lead to the absurd result that a
neutral school-choice program might be permissible in some parts of
Ohio . . . but not in'' others. Id. at 656-57. ``The constitutionality
of a neutral . . . aid program simply does not turn on whether and why,
in a particular area, at a particular time, most private [providers]
are run by religious organizations, or most recipients choose to use
the aid at a religious [provider].'' Id. at 658. Because the secular
alternative requirement made the definition of ``indirect Federal
financial assistance'' hinge on the geographically varying availability
of secular providers, it went beyond what the Establishment Clause
requires and actually created the result that the Zelman Court deemed
``absurd.''
The Agencies also disagree with commenters who contended that, in a
geographic area lacking a secular provider, a choice to expend aid on a
faith-based provider cannot be a genuine and independent choice of
private individuals under Zelman. As the Zelman Court summarized, the
mechanism by which indirect aid reaches religious programs--``numerous
[[Page 82074]]
private choices, rather than the single choice of a government,'' id.
at 652-53 (internal quotation marks omitted)--drives the Establishment
Clause analysis. Under this final rule, private choices will continue
to be the mechanism by which aid reaches religious programs. The
programs covered by the modified definition of indirect aid will be
open to administration by secular and faith-based providers alike.
Moreover, beneficiaries participating in a program in one geographic
area may spur new alternatives to serve that area and, as the
experience of the COVID-19 pandemic has evidenced, many services can be
obtained remotely from other geographic areas. Therefore, it cannot be
said that a single government choice determines the distribution of aid
in the programs.
The Agencies likewise disagree with a commenter's suggestion that
elimination of the written notice requirement will preclude the
programs at issue in this rulemaking from qualifying as indirect-aid
programs. Nowhere in Zelman, or in the cases on which Zelman relied,
did the Supreme Court suggest, much less hold, that indirect-aid
programs must require providers to post or provide notices regarding
their religious character and the availability of other providers. See
Zelman, 536 U.S. 639; see also Zobrest v. Catalina Foothills Sch.
Dist., 509 U.S. 1 (1993); Witters v. Wash. Dep't of Servs. for the
Blind, 474 U.S. 481 (1986); Mueller v. Allen, 463 U.S. 388 (1983).
One commenter suggested that Zelman is distinguishable because it
arose in the education context (where certain public school options had
to exist by law). The Agencies are unpersuaded that the distinction
amounts to a difference. As already explained, Zelman summarized the
Establishment Clause inquiry as whether it is ``numerous private
choices, rather than the single choice of a government,'' that
determines the flow of aid to religious providers. 536 U.S. at 652-53.
Under the definition the Agencies adopt today, beneficiary and provider
choices, rather than a single government choice, will determine the
flow of indirect aid.
Changes: None.
Affected Regulations: None.
b. Rights of Beneficiaries and Providers
Summary of Comments: The Agencies received both supportive and
opposing comments regarding the impacts of the proposal to eliminate
the secular alternative requirement on the rights of beneficiaries and
providers. Some commenters argued that elimination of the requirement
would violate the constitutional rights of some beneficiaries by
leaving them with no choice but to attend a program that includes
explicitly religious content, or by effectively adding a religious test
for receipt of government services. Similarly, others contended that
elimination of the secular alternative requirement would put certain
religious beneficiaries to the choice of adhering to their faith while
refusing benefits or participating in religious activities against
their faith to obtain the benefits.
On the other hand, one commenter opined that eliminating the
secular alternative requirement was necessary to bring the Agencies'
regulations into compliance with Trinity Lutheran, RFRA, and the
Attorney General's Memorandum. Specifically, the commenter argued that
by precluding religious beneficiaries in certain geographic areas from
expending indirect aid on religious service providers of their choice,
the requirement imposed an impermissible burden on those beneficiaries
in violation of Trinity Lutheran and RFRA.
Other commenters, including groups representing minority religions,
supported the proposal and pointed to a perception of disfavored
treatment of faith-based providers in the existing definition of
indirect Federal financial assistance. These commenters observed that,
under the 2016 rule, secular providers could be considered indirect-aid
recipients where beneficiaries lacked an adequate religious
alternative, but faith-based providers could not be considered
indirect-aid recipients where beneficiaries lacked an adequate secular
alternative.
Response: The Agencies again do not agree that eliminating the
secular alternative requirement would preclude genuine and independent
choices of private individuals under Zelman or would result in
involuntary or compulsory participation in religious activities. As
already explained, beneficiaries' use of indirect aid to participate in
programs with religious content will remain a function of private
choice. Any participation requirements that a faith-based provider
might impose on a beneficiary who chooses to expend indirect aid on
that provider's program would result from private choice rather than
government action and, therefore, would not implicate the beneficiary's
constitutional rights.\58\
---------------------------------------------------------------------------
\58\ Cf. Manhattan Cmty. Access Corp. v. Halleck, 139 S. Ct.
1921, 1928 (2019) (``In accord with the text and structure of the
Constitution, this Court's state-action doctrine distinguishes the
government from individuals and private entities.'').
---------------------------------------------------------------------------
The Agencies agree with the commenters who argued that, at least
under some circumstances, the secular alternative requirement was in
tension with providers' and beneficiaries' rights under the Free
Exercise Clause of the First Amendment. Under Trinity Lutheran and
Espinoza, disparate treatment of secular and faith-based providers is
in tension with the Free Exercise Clause. In Espinoza, the Supreme
Court reaffirmed its holding in Trinity Lutheran that ``disqualifying
otherwise eligible recipients from a public benefit solely because of
their religious character imposes a penalty on the free exercise of
religion that triggers the most exacting scrutiny.'' Espinoza, 140 S.
Ct. at 2255 (quoting Trinity Lutheran, 137 S. Ct. at 2021 (internal
quotation marks omitted)).
The secular alternative requirement resulted in some level of
distinction between secular and religious providers based solely on
religious character. When a secular provider option was not present,
this requirement precluded ``otherwise eligible recipients''--the
beneficiaries and the providers--from accessing a public benefit
``solely because of'' the provider's ``religious character.'' A secular
organization in the same position, where it was the only provider,
would still be eligible to provide services. The validity of such a
distinction has been called into question by Trinity Lutheran and
Espinoza. Furthermore, the secular alternative requirement may burden
the free exercise rights of both beneficiaries and providers. In
Espinoza, the Supreme Court addressed claims brought by the parents of
school-aged children, who were the beneficiaries. 140 S. Ct. at 2251-
52. The opinion, however, addressed not only the parents' liberty
interests, but also those of the religious schools, which were the
providers. The Court found that excluding religious provider options
from the State-run program ``burdens not only religious schools but
also the families whose children attend or hope to attend them.'' Id.
at 2261.
For these reasons, the Agencies have concluded that the secular
alternative requirement was in tension with Trinity Lutheran and
Espinoza and may burden the free exercise rights of beneficiaries and
providers under the First Amendment and RFRA. See Attorney General's
Memorandum, 82 FR at 49674.
Changes: None.
Affected Regulations: None.
c. Harms to Beneficiaries and Providers
Summary of Comments: Some commenters argued that the proposed
[[Page 82075]]
new definition of ``indirect Federal financial assistance'' would harm
beneficiaries in various ways. They argued that it would leave some
beneficiaries with only programs that include explicitly religious
content and program requirements; force some beneficiaries to
participate in, or be subjected to, religious activities that make them
uncomfortable or that violate their own religious beliefs; and subject
beneficiaries to discrimination or bias, including on the basis of
religion. Commenters argued that these consequences would be
experienced by religious minorities, by female-led households, by
racial minorities, by individuals who identify as transgender, and by
individuals who are lesbian, gay, or bisexual.
Response: The Agencies do not agree that the new definition of
``indirect Federal financial assistance'' will adversely impact
beneficiaries who are religious minorities, racial minorities, lesbian,
gay, bisexual, transgender, or in female-led households. The comments
predicting mistreatment of, or discrimination against, beneficiaries
lacked supporting evidence, anecdotal or otherwise. Moreover, faith-
based providers, like other providers, will be required to follow the
requirements and conditions applicable to the grants and contracts they
receive and will be forbidden to deny services in violation of these
requirements. There is no basis on which to presume that faith-based
providers are less likely than other providers to comply with their
obligations. See Mitchell v. Helms, 530 U.S. 793, 856-57 (2000)
(O'Connor, J., concurring in the judgment). And in any event, the
distinction between direct and indirect aid has no bearing on the scope
and substance of programs' nondiscrimination requirements; rather, the
distinction governs whether faith-based providers may use Federal
financial assistance to engage in, and may require beneficiaries to
participate in, explicitly religious activities or, instead, must
separate their explicitly religious activities from the supported
programs.
In this rulemaking, the Agencies have sought to retain all
necessary protections for beneficiaries while removing barriers to the
full and equal participation of faith-based organizations in federally
supported programs. In so doing, the Agencies recognize that, for many
faith-based organizations, the provision of services to those in need
is an exercise of their religious beliefs, and many faith-based
organizations therefore view their explicitly religious activities as
integral parts of the programs and services that they provide. The
Agencies also are mindful that an unduly restrictive definition of
indirect Federal financial assistance--the definition that controls
whether and when federally supported programs may incorporate
explicitly religious activities--could discourage such faith-based
organizations from participating in federally supported programs. This
result would harm not only faith-based organizations whose religious
activities are fundamental to their programs and services, but also
beneficiaries by discouraging such faith-based organizations from
operating in unserved and underserved communities.
Indeed, elimination of the secular alternative requirement will
make a difference only in circumstances where there is no adequate
secular provider in a geographic area. It is better, in the Agencies'
view, for beneficiaries in such unserved or underserved communities to
have a faith-based option to receive indirect-aid services--even one
that incorporates explicitly religious activities in which the
beneficiaries otherwise might prefer not to participate--than to have
no option at all. At the same time, the Agencies recognize that some
beneficiaries may wish not to participate in explicitly religious
activities that make them uncomfortable or that are inconsistent with
their own religious beliefs. The Agencies, however, believe that this
interest is served by this final rule, which will place the choice of
service provider in the hands of beneficiaries and will not require
them to accept the services of faith-based providers. Although the
Agencies recognize that, in unserved or underserved communities,
beneficiaries' needs for services may motivate them to choose service
providers that they otherwise might not prefer, the Agencies believe
they are better served by having an option, rather than having no
option at all. It will still be their choice, not the Government's, to
accept services from the faith-based provider.
This conclusion is consistent with the Court's reasoning in
Espinoza, which rejected the argument that the ``no-aid provision'' at
issue ``actually promotes religious freedom'' by ``keeping the
government out of [religious organizations'] operations.'' 140 S. Ct.
at 2260 (emphasis in original). That some potential recipients might
decline to participate does not justify ``eliminating any option to
participate in the first place,'' id. at 2261, and certainly does not
provide support for ``disqualifying otherwise eligible recipients from
a public benefit solely because of their religious character,'' id. at
2255 (internal quotation marks omitted), as some commenters would have
the Agencies do.
Moreover, the purposes of this final rule include ensuring that
otherwise eligible faith-based providers can participate on equal terms
as secular providers and are not deterred from applying due to
unnecessary or unclear rules, including fear of litigation. Faith-based
providers might not have participated in indirect-aid programs because
they were unaware of existing secular alternative providers or were
unsure whether the existing secular providers would be deemed
``adequate.'' Although these instances and harms are difficult to
quantify, beneficiaries in unserved and underserved areas would have
been harmed by the absence of any federally funded programming.
In sum, the Agencies are exercising their discretion to finalize
this amended definition of ``indirect Federal financial assistance,''
in order to avoid potential constitutional problems and to achieve the
policy goals of expanding the availability of federally funded services
to beneficiaries and of limiting obstacles to the equal participation
of religious providers in those programs.
Changes: None.
Affected Regulations: None.
2. Required Attendance at Religious Activities
Under eight of the Agencies' current regulations, a religious
organization ``that participates in a program funded by indirect
financial assistance need not modify its program activities to
accommodate a beneficiary who chooses to expend the indirect aid on the
organization's program.'' E.g., 28 CFR 38.5(c). HUD's current
regulations have slightly different wording, stating that ``this
section does not require any organization that only receives indirect
Federal financial assistance to modify its program or activities to
accommodate a beneficiary that selects the organization to receive
indirect aid.'' 24 CFR 5.109(h).
The NPRMs proposed amending this language to clarify that this
extends to an organization's attendance policies, where such policies
require attendance at ``all activities that are fundamental to the
program.'' HUD proposed to keep its unique language and to add the new
language at the end of the provision.
a. Establishment Clause
Summary of Comments: Some comments opposed the proposed change on
the ground that allowing any providers in an indirect-aid program to
include required religious elements in their programs violates the
[[Page 82076]]
Establishment Clause. Other comments supported the change and viewed
the change as consistent with established precedent.
Some commenters argued that this proposal violates the
Establishment Clause when considered alongside the proposed elimination
of the adequate secular alternative requirement from the definition of
``indirect Federal financial assistance.'' As the commenters
characterized this interplay, the changes taken together would have the
effect of allowing providers to impose religious exercise on
beneficiaries in circumstances in which no adequate secular alternative
is available, effectively conditioning government aid on participation
in a religious activity and, thereby advancing religion. A commenter
cited Corporation of Presiding Bishop of Church of Jesus Christ of
Latter-Day Saints v. Amos, 483 U.S. 327, 334-35 (1987), as support for
this position.
Response: The Agencies disagree with the commenters who argued that
allowing providers to require attendance at all activities that are
fundamental to an indirect-aid program violates the Establishment
Clause. The Supreme Court has repeatedly upheld government programs in
which aid, directed by private choice, is used by the beneficiary to
attend programs with a required religious element.\59\ The Court upheld
the use of government funds in these programs because the ``link
between government and religion [was] attenuated by private choices.''
Espinoza, 140 S. Ct. at 2261. The beneficiary's voluntary use of such
aid is not ``state action sponsoring or subsidizing religion.''
Witters, 474 U.S. at 488 (emphasis in original). ``Nor does the mere
circumstance that [a beneficiary] has chosen to use neutrally available
state aid'' for a religious program ``confer any message of state
endorsement of religion.'' Id. at 488-89. Allowing beneficiaries in an
indirect-aid program to choose to use aid on programs that may require
attendance at religious ``activities that are fundamental to the
program'' thus does not contravene the Establishment Clause.
---------------------------------------------------------------------------
\59\ See, e.g., Zelman, 536 U.S. 639; Zobrest, 509 U.S. 1
(holding that the Establishment Clause did not bar a public school
district from providing an interpreter to a deaf student attending
Catholic high school); Witters, 474 U.S. 481 (finding no bar to
State rehabilitation program used to assist blind man to train for
ministry); Mueller, 463 U.S. 388 (finding no bar to State tax
deduction for education expenses incurred by parents of children
attending parochial schools).
---------------------------------------------------------------------------
The Agencies also disagree with commenters who argue that the
interplay between the new definition of indirect aid and the prospect
that a program at which the beneficiary uses indirect aid will require
participation at religious activities creates an Establishment Clause
problem. As discussed in the preceding paragraphs, under the Supreme
Court's indirect-aid cases, allowing beneficiaries in an indirect-aid
program to choose to use aid on programs that may require attendance at
religious ``activities that are fundamental to the program'' does not
conflict with the Establishment Clause because there is no government
endorsement of religion, much less coercion. And, as explained in Part
II.D.1, use of indirect aid by programs with required religious
participation will remain a function of private choice, no matter what
alternatives might be available. In an area where the only provider of
a certain social service happens to be a faith-based organization that
requires participation in religious activities, it would make no sense
to deny the availability of the Federal aid altogether, instead of at
least giving beneficiaries in the area the choice whether to use it at
that organization. The result of such a rule would be to discriminate
in the availability of indirect Federal assistance along regional
lines. See Zelman, 536 U.S. at 657-58. Absent the Government endorsing
or coercing beneficiaries to accept the social service in question, the
Agencies do not believe that the two provisions, taken together, give
rise to Establishment Clause violations.
Amos lends no support to the commenters' position. In the passage
the commenters cited, the Supreme Court noted that accommodation of
religion ``may devolve into an unlawful fostering of religion.'' 483
U.S. at 334-35 (internal quotation marks omitted). But, according to
the Supreme Court in Amos, for a government accommodation to have such
``forbidden `effects,' . . . it must be fair to say that the government
itself has advanced religion through its own activities and
influence.'' Id. at 337 (emphasis in original). As discussed in Part
II.D.1.a, such is not the case with indirect Federal financial
assistance, which is not so much a religious accommodation as an
allowance for participation by all qualified providers. Any religious
or non-religious use of the funds is attributable to the beneficiary's
choice--not the Government's. The same analysis holds true with respect
to the presence or the absence of providers in a locale, for the
reasons given in Part II.D.1.b and the previous paragraph. Therefore,
the Agencies do not believe there is any conflict with the
Establishment Clause.
Finally, for consistency and uniformity, HUD finalizes its
regulation with language similar to what the other Agencies are using:
``an organization that participates in a program funded by indirect
Federal financial assistance need not modify its program or activities
to accommodate a beneficiary who chooses to expend the indirect aid on
the organization's program and may require attendance at all activities
that are fundamental to the program.'' HUD notes that it did not
receive any comments regarding its language.
Changes: HUD is adopting language consistent with that used by the
other Agencies.
Affected Regulations: 24 CFR 5.109(g).
b. Clarification
Summary of Comments: Some commenters praised the proposals in the
NPRMs--including this proposed change--that remove incentives for
religious organizations to modify the degree of their religious
expression, reducing burdens on the free exercise of religion. Some
also highlighted the religious liberty interests a beneficiary may have
in choosing to participate in a program that includes required
religious activities that are fundamental to the program. Other
commenters argued that the changes are not necessary to promote
religious liberty.
Some commenters argued that the proposed clarifying language
contravened the nondiscrimination requirements of Executive Order
13559, which applied to providers of both direct and indirect Federal
financial assistance. One commenter supported this argument by
referencing the 2016 final rule in which the Agencies chose not to
include language similar to the current proposal because Executive
Order 13559 purportedly prohibited it.
Response: The Agencies agree with the comments suggesting that
restricting beneficiaries from accessing, or providers from
maintaining, indirect-aid programs that include religious activities
may burden the free exercise rights of both beneficiaries and faith-
based providers. Since Sherbert v. Verner, 374 U.S. 398 (1963), the
Supreme Court has held that conditioning neutrally available benefits
on action contrary to religious exercise can place a substantial burden
on a person's free exercise rights.\60\ Although
[[Page 82077]]
the Supreme Court subsequently curtailed the application of these cases
for Free Exercise Clause purposes in Employment Division v. Smith, 494
U.S. 872, Congress chose in RFRA to impose the same protections in
Federal programs. See Attorney General's Memorandum, 82 FR at 49674.
Conditioning a religious organization's ability to participate in an
indirect-aid program on its willingness to modify attendance
requirements for activities fundamental to the program may, in similar
fashion, impose a ``unique disability upon those who exhibit a defined
level of intensity or involvement in protected religious activity.''
McDaniel, 435 U.S. at 632 (Brennan, J., concurring in the judgment). It
would also deprive beneficiaries who would otherwise choose to
participate in a program with religious activities of that option. As
previously discussed in Part II.D, whether beneficiaries in a given
locality have available the full range of potential options, secular or
religious, should not be reason to deprive beneficiaries of the choice
offered even in cases where the menu of options might be more limited.
In the Agencies' view, some choice will be better than none.
---------------------------------------------------------------------------
\60\ See Sherbert, 374 U.S. at 404-06 (``It is too late in the
day to doubt that the liberties of religion and expression may be
infringed by the denial of or placing of conditions upon a benefit
or privilege.''); see also Hobbie, 480 U.S. at 141 (`` `Where the
state conditions receipt of an important benefit upon conduct
proscribed by a religious faith, or where it denies such a benefit
because of conduct mandated by religious belief, thereby putting
substantial pressure on an adherent to modify his behavior and to
violate his beliefs, a burden upon religion exists. While the
compulsion may be indirect, the infringement upon free exercise is
nonetheless substantial.' '' (quoting Thomas, 450 U.S. at 717-18
(emphasis omitted))).
---------------------------------------------------------------------------
The Agencies do not interpret the current regulations to require an
organization at which beneficiaries choose to use their indirect aid to
modify its programs to eliminate required participation in explicitly
religious activities. As the preamble to the 2016 final rule makes
clear, Executive Order 13559 provided that organizations receiving
Federal financial assistance ``shall not, in providing services or in
outreach activities related to such services, discriminate against a
program beneficiary or prospective program beneficiary on the basis of
religion, a religious belief, a refusal to hold a religious belief, or
a refusal to attend or participate in a religious practice.'' 81 FR at
19361. At the same time, the 2016 rule added that ``an organization
that participates in a program funded by indirect financial assistance
need not modify its program activities to accommodate a beneficiary who
chooses to expend the indirect aid on the organization's program.'' Id.
Using a 12-step program as an example, the 2016 preamble explained that
a program funded through indirect aid that ``includes religious content
that is integral to the program would not be required to alter its
program to accommodate an objector who pays for the program with
indirect aid.'' Id. (emphasis added). Requiring that such programs
include the ability to opt out of religious activity does not make
sense given their inherently religious character and the fact that the
beneficiaries will have freely chosen the program with that religious
content. The Agencies did not believe that an organization declining to
undertake such a modification would have violated the nondiscrimination
provisions of Executive Order 13559 or those of the Agencies' rule in
2016. The Agencies view the issue the same way today.
However, given the comments received arguing that the prior
regulations required such an organization to undertake such a
modification, the Agencies believe it appropriate to include language
clarifying this issue in the final rule. The final rule includes
language to eliminate any uncertainty over this issue in the future.
Religious providers at which beneficiaries choose to use indirect aid
will not be required to alter any fundamental program elements that
require participation in religious activities.
Changes: None.
Affected Regulations: None.
E. Accommodations for Faith-Based Organizations
DHS's existing regulations provided that ``[n]othing in this part
shall be construed to preclude DHS or any of its components from
accommodating religious organizations and persons to the fullest extent
consistent with the Constitution and laws of the United States.'' 6 CFR
19.3(d). Additionally, DOL's existing regulations specified that its
provision prohibiting religion-based discrimination against
beneficiaries did not ``preclude'' DOL or its intermediaries ``from
accommodating religion in a manner consistent with the Establishment
Clause of the First Amendment to the Constitution.'' 29 CFR 2.33(a).
The other Agencies' existing regulations did not contain parallel
provisions that explicitly addressed religious accommodations for
faith-based organizations.
All of the Agencies proposed to add express language regarding
accommodations. When providing that faith-based organizations are
eligible on the same basis as any other organization, they all proposed
adding that eligibility is subject to the Agencies' ``considering''
accommodations. All eight of the Agencies that proposed specific text
for notices to faith-based organizations--DHS, DOJ, DOL, ED, HHS, HUD,
VA, and USDA--also proposed to include specific language in those
notices indicating that religious accommodations may also be sought
under many of the listed Federal laws. Additionally, when providing
that all organizations are required to carry out all eligible
activities in accordance with all program requirements, DHS, DOJ, DOL,
ED, HHS, HUD, and VA proposed to add that this is ``subject to'' any
accommodations. USDA proposed to add more generally that ``[t]he
requirements established in this part do not prevent a USDA awarding
agency or any State or local government or other intermediary from
accommodating religion in a manner consistent with [F]ederal law and
the Religion Clauses of the First Amendment to the U.S. Constitution.''
Within these provisions, DHS, DOJ, ED, HHS, USAID, and USDA
proposed that such accommodations be ``appropriate under'' or
``consistent with'' the U.S. Constitution and Federal laws. HUD
proposed to expressly reference RFRA.
Summary of Comments: To the extent that the comments regarding the
scope and application of RFRA discussed in Parts II.C and II.F are
relevant to the added accommodation language discussed in this section,
the Agencies incorporate those comments and responses from Parts II.C
and II.F. Similarly, some of the examples and hypotheticals discussed
in Part II.C were repeated by other commenters, or could be construed
broadly, as comments on the proposed accommodation language discussed
in this section. Therefore, the Agencies incorporate any such relevant
examples here.
Several commenters supported the accommodation language in the
proposed rules because it provides expressly for accommodations that
the Agencies were already required or permitted to grant under existing
Federal law, including RFRA. Most of these commenters explained that
adding this language was important to make clear--to faith-based
organizations, the Agencies, State and local governments, and any other
intermediaries--that faith-based providers do not lose their rights to
seek such accommodations in the Federal funding process. One of these
commenters added that this accommodation language recognizes and
clarifies that existing law protects religious exercise, not just
religious identity. One of these commenters also outlined specific
principles from RFRA
[[Page 82078]]
and Free Exercise Clause cases that should guide the accommodation
inquiry, and these principles are listed in the response section below.
The Agencies solicited comments on whether to define the terms that
they each proposed to describe such accommodations. Some commenters
stated that the Agencies should not define the term because there is an
accepted legal usage of ``accommodation'' that would be difficult to
capture in a single definition. Certain national religious medical
organizations proposed that the Agencies define an accommodation as ``a
provision made by the [F]ederal government for the free exercise of
religion of a [F]ederal-funded recipient, who collaborates with the
[F]ederal government in meeting the health or social service needs of a
specific population, but the intent for which [F]ederal dollars are not
explicitly allocated and expended.''
Several other commenters argued that the terms used by the Agencies
to describe accommodations were vague and would only create confusion,
including because the Agencies did not provide any explanation of the
meaning of those terms. Some of these commenters argued that this
accommodation language would create confusion because there are no
clear lines in this area and because the Agencies do not identify any
real-world or hypothetical examples of an accommodation that would be
granted. One of these commenters noted that Congress has used the term
``reasonable accommodation'' differently in various statutes but it has
almost always been accompanied by the express or implicit requirement
that it not impose an ``undue hardship'' on others, citing 42 U.S.C.
2000e, 42 U.S.C. 12112(b)(5)(A), and Shapiro v. Cadman Towers, Inc., 51
F.3d 328, 334-35 (2d Cir. 1995).
Some of these commenters argued that the accommodation language
would create confusion by suggesting that faith-based organizations
could seek accommodations from program requirements, including to
refuse to provide the program's services to eligible beneficiaries.
They were particularly concerned about accommodations from requirements
that are very important to any government-funded program. Some of these
commenters also argued that the proposed references to accommodations
in multiple sections of the proposed rules would create additional
confusion for providers and beneficiaries. One of these commenters
argued that the Agencies had not identified any evidence or analysis
for why this vague new language is needed at this time.
Several commenters argued that the Agencies were creating new
accommodations where none should be granted. Some of these commenters
argued that such accommodations would be contrary to, or not required
by, Trinity Lutheran because they would give faith-based organizations
exemptions and preferential treatment, whereas Trinity Lutheran
requires a level playing field. One of these commenters added that this
accommodation language was not required by operative--though uncited--
legal authority and should be rejected.
Some of these commenters argued that the accommodation language
contradicted other aspects of this final rule. They argued that it was
internally contradictory for the Agencies to provide that faith-based
organizations are eligible ``on the same basis as any other
organization'' while adding ``subject to'' accommodations that give
preferential exemptions from rules. One of these commenters argued that
applying these accommodation standards solely to faith-based
organizations contradicted the Agencies' assertion that they removed
``certain standards'' because those standards applied solely to faith-
based organizations. One of these commenters added that allowing
accommodations for faith-based organizations was contrary to the
provision in this final rule that an organization receiving indirect
Federal financial assistance does not need to modify its program or
activities to accommodate a beneficiary.
Multiple commenters opposed any exemption of faith-based
organizations from laws and regulations that otherwise apply
universally. Some of these commenters argued that accommodations are
not permitted from generally applicable laws that prohibit
discrimination because religiously motivated conduct does not receive
special protection from general, neutrally applied legal requirements
under Fulton v. City of Philadelphia, 922 F.3d 140, 159 (3d Cir. 2019),
cert. granted, 140 S. Ct. 1104 (U.S. Feb. 24, 2019). Similarly, other
commenters argued that the Supreme Court had either rejected or had not
adopted a general rule that faith-based organizations could deny
individuals service under a public accommodations law in Masterpiece
Cakeshop, Ltd. v. Colorado Civil Rights Commission, 138 S. Ct. 1719
(2018).
One commenter argued that religious accommodations are unnecessary
because providing the federally funded services is not a
``fundamental'' or ``central'' religious activity and faith-based
organizations are not obligated to participate in Federal programs or
funding. Several commenters argued that faith-based organizations
should either comply with nondiscrimination laws or forgo taxpayer
money.
Several commenters argued that the added accommodation language
would grant new or expanded accommodations from program requirements
that would be inappropriate. Some of these commenters argued that
exempting grantees from program requirements would be contrary to
Congressional intent in establishing these programs because the
legislation under which these programs are authorized does not allow
discriminatory denial of service by the entities receiving funding.
Similarly, multiple commenters argued that providing accommodations
from program requirements would undermine the central goal of these
programs, which is to provide people with the services they need.
Some commenters argued that the Agencies had not adequately
accounted for the costs of accommodations that beneficiaries would
bear. They argued that the NPRMs did not discuss the need to protect
the program beneficiaries' religious freedom or their access to
services, especially beneficiaries for whom these services may be a
matter of life and death. These commenters were concerned that
additional accommodations would further threaten the health and well-
being of individuals across the country because faith-based
organizations could flout established applicable guidelines, bypass
standards of care, discriminate against clients or potential clients,
or deny evidence-based services or treatments. Some commenters also
argued that beneficiaries could be uncomfortable or forgo services, as
discussed in Part II.C. Some of these commenters also argued that a
faith-based organization's religious beliefs should not be the basis to
deny needed services to beneficiaries.
Some of these commenters argued that any such third-party harms
should preclude accommodations under the Establishment Clause, citing
Hobby Lobby, Cutter, Texas Monthly, Kiryas Joel, Amos, and Estate of
Thornton. They argued that Hobby Lobby was premised on the
accommodation's imposing no third-party harms. Other commenters argued
that third-party harms implicate, but do not categorically violate, the
Establishment Clause under the cases cited above. One of these
commenters also disagreed with the statement in the Attorney General's
[[Page 82079]]
Memorandum that ``the fact that an exemption would deprive a third
party of a benefit does not categorically render an exemption
unavailable.'' 82 FR at 49670.
Some of these commenters argued that the accommodation language
does not acknowledge the constitutional limits on such exemptions when
they cause harm to others. One of these commenters claimed that the
accommodation language puts the interests of faith-based providers
above those of the program beneficiaries whose rights and access to
needed program services will be put at risk. Another commenter argued
that such explanation was absent from the proposed regulatory text but
acknowledged that the Agencies had recognized these limits on
accommodations in the NPRMs.
Some of these commenters also argued that the Agencies do not
explain why they are providing express accommodations for faith-based
organizations, but not for beneficiaries. These commenters argued that
it is just as legitimate to accommodate beneficiaries as faith-based
providers. Another commenter argued that it was arbitrary to claim that
accommodations for faith-based organizations are warranted because
``few will need them,'' while claiming accommodations for
beneficiaries' religious freedom are not warranted because ``few will
need them.''
Several commenters argued that expanded accommodations from program
requirements would allow faith-based providers to seek accommodations
to discriminate against beneficiaries or refuse to provide services
that are otherwise required. Some of these commenters argued
categorically that faith-based organizations should not be able to
obtain accommodations or exemptions from nondiscrimination laws. One of
these commenters argued that courts have long rejected arguments that
faith-based organizations can be exempt from antidiscrimination
requirements, citing Bob Jones University v. United States, 461 U.S.
574 (1983), Newman v. Piggie Park Enterprises, Inc., 390 U.S. 400
(1968), Dole v. Shenandoah Baptist Church, 899 F.2d 1389 (4th Cir.
1990), and Hamilton v. Southland Christian School, Inc., 680 F.3d 1316
(11th Cir. 2012). These commenters were concerned that faith-based
providers would seek and obtain such accommodations more often than
they had before.
Some of these commenters argued that providing services without
discrimination is key to an organization's ability to effectively carry
out the Agencies' objectives. Some of these commenters pointed to other
areas where the Agencies had recognized the existence of, and harm
from, discrimination. One of these commenters argued that denial of
service or care in healthcare settings can be deadly.
A few commenters argued that the added accommodation language would
enable faith-based providers to limit their services to co-religionists
or those who share the organizations' beliefs. Some commenters argued
that the Agencies had not adequately explained the reason for creating
what they described as vast new exemptions that may allow religious
providers to avoid providing the services for which they are accepting
taxpayer funds. A commenter argued that, to the extent these
accommodations would allow organizations to discriminate on the basis
of a beneficiary's religious belief or practice, or lack thereof, it
would conflict with the prohibition on such discrimination in Executive
Order 13279.
Some commenters were concerned that faith-based organizations would
use religion as a pretext to discriminate against beneficiaries. These
commenters argued that the Government should not endorse and fund such
discrimination against religious minorities, LGBTQ people, and others
who do not act in accordance with the organization's religious beliefs,
such as not attending religious services, marrying a person of the same
sex, getting divorced, using birth control, or engaging in sexual
relations when unmarried. One of the commenters opposing this language
recognized that RFRA sometimes allows the denial of services but this
commenter considered that to be improper discrimination. Some
commenters argued categorically that requiring compliance with Federal
civil rights laws does not infringe anyone's freedom of conscience or
demand anyone change their religious beliefs.
Some commenters argued that faith-based organizations could not
satisfy the RFRA standard to warrant an accommodation that would allow
discrimination. Some commenters argued that there is no RFRA
substantial burden for being required to serve LGBTQ people because the
Sixth Circuit held that mere toleration of transgender characteristics
is not tantamount to official endorsement or support of those traits,
which would be necessary to establish a substantial burden. Harris
Funeral Homes, 884 F.3d at 587-88. These commenters also argued that
the Agencies would be able to satisfy strict scrutiny for prohibitions
on such discrimination based on Harris Funeral Homes, Fulton, and
Norwood v. Harrison, 413 U.S. 455 (1973). According to these
commenters, these cases held that eradicating and prohibiting
discrimination are compelling interests and that mandating compliance
with nondiscrimination laws is the least restrictive means of pursuing
such interests.
Several commenters argued that allowing discrimination in taxpayer-
funded programs would violate other principles. Some of these
commenters were concerned that allowing such discrimination would
violate the Establishment Clause by providing direct financial support
for religion. One of these commenters argued that this would amount to
giving faith-based organizations ``the right to use taxpayer money to
impose [their beliefs] on others,'' quoting ACLU of Massachusetts v.
Sebelius, 821 F. Supp. 2d 474 (D. Mass. 2012), which is discussed in
Part II.F.2.a. Another commenter argued that the U.S. Constitution bars
the Government from directly funding or providing aid to private
institutions that engage in discrimination, citing Norwood, 413 U.S. at
465-66. See also Christian Legal Soc. v. Martinez, 561 U.S. 661, 682
(2010). Some individual commenters argued that it would violate their
religious liberties if they were forced to fund--through taxpayer
dollars--organizations that discriminate in the provision of federally
funded services.
Other commenters were worried that the accommodation language was
based on the Attorney General's Memorandum. These commenters argued
that the Attorney General's Memorandum potentially violated the
Establishment Clause because it did not put any checks on religious
exercise, seemed to elevate the right to religious exemptions above
other legal and constitutional rights, and said that organizations, not
just people, have religious freedom. These commenters argued that the
added accommodation language based on the Attorney General's Memorandum
dangerously expands the ability for religious entities to request
special treatment that may enable discrimination against beneficiaries.
Several commenters were particularly concerned, including based on
their experiences, that the accommodation language could allow entities
to discriminate against or deny service to traditionally marginalized
groups and underserved communities, including women (especially women
of color), persons with disabilities, LGBTQ
[[Page 82080]]
persons, and those living in rural communities. These commenters were
concerned that denial of care could exacerbate existing disparities for
these groups. Some of these commenters were also concerned that these
communities could face added barriers to accessing services in
religious spaces, which would cause further harm.
Some commenters pointed to past examples to support or oppose this
accommodation language. One commenter pointed to a court's granting a
religious exemption to a faith-based shelter for homeless women when a
city tried to force it to comply with a local public accommodation law
that was contrary to the shelter's religious mission and message. See
Downtown Soup Kitchen v. Municipality of Anchorage, 406 F. Supp. 3d 776
(D. Alaska 2019). This commenter argued that the accommodations
language in the rule would make clear that faith-based organizations
could be protected from such requirements in federally funded programs.
Another commenter pointed to an example where HHS granted an
exemption to allow a Protestant child welfare agency that received
Federal funding to deny services to women from other religions.\61\
This commenter argued that the exemption for the provider's ``religious
identity'' was used to rob the women of their religious freedom, deny
them the ability to become foster parents, and dictate that a group of
children from all backgrounds be placed exclusively in Protestant
homes.
---------------------------------------------------------------------------
\61\ See Frank J. Bewkes et al., Center for American Progress,
Welcoming All Families (Nov. 20, 2018) https://www.americanprogress.org/issues/lgbtq-rights/reports/2018/11/20/461199/welcoming-all-families.
---------------------------------------------------------------------------
Other commenters relied on hypothetical examples, including many of
the ones listed in Part II.C. Additionally, some commenters were
concerned that faith-based organizations could deny reproductive health
access for women and girls, including contraception for unwed
adolescent girls. They were similarly concerned about denials of
condoms to men who have sex with men and to transgender individuals in
HIV treatment and prevention programs, which would undermine the
overall program goals. Another commenter, however, said it would be
appropriate, for example, to exempt a Muslim food kitchen from
providing pork on its menu.
A commenter argued that the Agencies had considered RFRA when
adopting the 2016 final rule and presented no reasoned analysis for
discarding those conclusions now.
Some commenters argued that the accommodation language, in
combination with the provisions that permit religious organizations to
maintain their religious character and expression, could result in
faith-based organizations proselytizing or expressing religious views
in connection with providing federally funded services. One of these
commenters speculated that such activities could discourage LGBTQ
individuals from seeking critical services and could create unnecessary
discomfort for beneficiaries who disagree.
Another commenter was also concerned that the accommodation
language--combined with the other changes addressed in Parts II.F and
II.G--would increase preferential treatment for religious
organizations.
Finally, some commenters argued that the accommodation language was
unwarranted, arbitrary, and capricious.
Response: The Agencies agree with the comments that supported the
accommodation language. The constitutional and statutory accommodations
addressed by this language were required or permitted under the prior
rule. The same is true for the other Federal laws that require
accommodations or that prohibit discrimination based on conscience,
including 42 U.S.C. 238n, 42 U.S.C. 300a-7, 42 U.S.C. 2000e-1(a) and
2000e-2(e), 42 U.S.C. 12113(d), 42 U.S.C. 18113, and the Weldon
Amendment, see, e.g., Further Consolidated Appropriations Act, 2020,
Public Law 116-94, div. A, sec. 507(d), 133 Stat. 2534, 2607 (Dec. 20,
2019). Protections under these constitutional and statutory provisions
were available under the 2016 final rule and continue to be available.
Also, the Agencies were always obligated to consider the RFRA
implications of their program requirements, as discussed in Part II.C.
See, e.g., Little Sisters, 140 S. Ct. at 2383-84 (failure to consider
such RFRA rights could make the Agencies ``susceptible to claims that
the rules were arbitrary and capricious for failing to consider an
important aspect of the problem''). The accommodation language in this
final rule merely recognizes that governing law; it is not a
``substantive change,'' as HHS explained in its NPRM. 85 FR at 2979,
2981.
The Agencies determine that it is important to add clarifying
language to ensure that this existing law is clear to faith-based
organizations, the Agencies, State and local governments, any other
intermediaries, and any potential challengers to faith-based
organizations' participation. Based on various Agencies' experience and
research, faith-based organizations with accommodation needs have been
deterred from participating, sued when they participated, and denied
participation in Federal financial assistance programs or activities.
See, e.g., Franciscan Alliance, Inc. v. Burwell, 227 F. Supp. 3d 660,
691-93 (N.D. Tex. 2016) (holding in the alternative that faith-based
health care providers were likely to succeed on the merits of their
claim to a RFRA accommodation to refuse to perform, refer for, or cover
gender reassignment surgeries or abortions that had been required by a
nondiscrimination provision connected to receipt of Federal financial
assistance); cf. Exclusion of Religiously Affiliated Schools from
Charter-School Grant Program, 44 Op. O.L.C. ___, *6 (Feb. 18, 2020),
https://www.justice.gov/olc/file/1330966/download (``Forbidding charter
schools under the program from affiliating with religious organizations
discriminates on the basis of religious status.''); Religious
Restrictions on Capital Financing for Historically Black Colleges and
Universities, 43 Op. O.L.C. ___, *9 (Aug. 15, 2019), https://www.justice.gov/olc/file/1200986/download (``Religious Restrictions'')
(``The Establishment Clause permits the Government to include religious
institutions, along with secular ones, in a generally available aid
program that is secular in content.'').
Also, some have challenged the premise that the Agencies may
proactively grant accommodations to religious providers. The
persistence of such arguments was demonstrated by the public comments
on this final rule and by litigation on the issue, including Little
Sisters. Although substantive disagreements regarding the scope of such
accommodations will continue, the Agencies determine to add express
accommodation language at this time to ensure that faith-based
organizations know their religious exercise can, in appropriate
circumstances, be protected and accommodated in federally funded
programs, to ensure that such accommodations are proactively requested
and considered in the application process, and to help eliminate
disputes regarding the availability of such accommodations. The
Agencies agree with commenters that faith-based organizations are more
likely to seek such accommodations under this final rule.
The Agencies determine that this clarity is also appropriate
because of how some accommodations have been handled recently by State
and local
[[Page 82081]]
governments where RFRA and other Federal protections do not apply. In
an example cited by commenters, the City of Philadelphia cancelled a
contract with a faith-based foster care agency that could not certify
same-sex couples consistent with its religious beliefs. The faith-based
organization was willing to refer any same-sex couple to one of the
many other agencies in the city. The city has argued that it ``has no
authority to grant exemptions to the contract's nondiscrimination
requirement.'' Br. for City Respondents at 35, Fulton v. City of
Philadelphia, No. 19-123 (U.S. Aug. 1, 2020). This final rule makes
clear that, when it comes to Federal financial assistance programs and
activities, the Agencies and their intermediaries do have such
authority where permitted by existing Federal laws. The Agencies also
note that the Fulton case is pending at the U.S. Supreme Court, see 140
S. Ct. 1104, and any relevant decision will be incorporated into the
accommodation analysis going forward.
One commenter gave the example of an HHS exemption involving a
Protestant child welfare agency. But HHS granted that exemption to the
State of South Carolina, to be applied with respect to certain
similarly situated faith-based providers, and not directly to the
faith-based provider itself. It was also based on a provision that
applies equally to requests for deviations or exceptions by secular
organizations; \62\ and it was based on an appropriate context-specific
analysis of the religious freedom rights of faith-based providers under
RFRA. In addition, that exemption did not deny anyone the ability to
become a foster parent, and did not dictate that children be placed in
Protestant homes. Indeed, the exempt agency (or another similarly
situated agency) was required to refer prospective foster parents with
whom it could not work to another child placement agency or to the
State program. This example thus demonstrates the reasonable outcomes
from applying the appropriate accommodation analysis, as discussed in
Part II.C. The accommodation language in this final rule makes clear
that such accommodations are available but does not change the
substance of that accommodation analysis. For these reasons, the
Agencies are adding this accommodation language now, although they
chose not to include such language in the 2016 final rule. See 81 FR at
19370-71 (concluding that a RFRA-based process for employment
exemptions was beyond the scope of the 2016 final rule).
---------------------------------------------------------------------------
\62\ See 2 CFR 200.102 (OMB uniform guidance for executive
branch agencies).
---------------------------------------------------------------------------
The Agencies agree with the comments that said the Agencies should
not further define the terms regarding these accommodations. As
demonstrated by the proposed definition submitted by a commenter and by
the list of principles in the next paragraph, it is difficult to fully
capture all of the nuances in a single definition. It would also be
difficult for any single definition to capture the nuances among the
available types of accommodations, as well as the full current case
law, let alone retain flexibility to incorporate future developments in
Federal statutes and case law.
Many of the comments that opposed the accommodation language did so
based on incorrect or inapplicable legal standards. This language is
not being added based on Trinity Lutheran. That case reaffirmed that
faith-based organizations cannot be disfavored based on religious
character. That is a basis for the aspects of this final rule that
provide for equal treatment, as discussed in Parts II.C, II.D, II.F,
and II.G. But other First Amendment principles and Federal statutes
mandate or permit accommodations that enable faith-based organizations
to act in accordance with their religious beliefs and consciences. For
example, the Federal Government can permit such organizations to
participate in federally funded programs without substantial burdens to
their religious exercise. The accommodation language incorporates those
legal principles. As a result, there is no contradiction between
mandating eligibility ``on the same basis as any other organization''
consistent with Trinity Lutheran, while also providing that this is
``subject to'' accommodations consistent with the other binding legal
principles. For the same reasons, it is not internally inconsistent to
remove the alternative provider notice-and-referral requirements that
applied solely to faith-based organizations, in tension with Trinity
Lutheran and RFRA, while also providing expressly for accommodations
that are required or mandated by existing Federal law, including RFRA.
Commenters also mistakenly argued that accommodations are not
available from neutral laws of general applicability. This final rule
applies to Federal financial assistance programs that are governed by
RFRA and other existing Federal laws that require or permit certain
accommodations even from neutral laws of general applicability. These
commenters relied on Fulton and Masterpiece Cakeshop, but those cases
involved State and local governments that were not subject to RFRA or
the other Federal laws addressed here. And, as discussed elsewhere,
current Free Exercise Clause and Establishment Clause jurisprudence
does not preclude permissive accommodations.
Additionally, future RFRA accommodations are not precluded by the
Sixth Circuit's decision in the Harris Funeral Homes case cited by
commenters. That case applied a substantial burden standard that is
arguably inconsistent with Hobby Lobby and prior cases, as discussed in
Part II.C.3.d. See, e.g., Hobby Lobby, 573 U.S. at 723-25; see also
Little Sisters, 140 S. Ct. at 2383 (explaining that, in Hobby Lobby,
``we made it abundantly clear that, under RFRA, the Departments must
accept the sincerely held complicity-based objections of religious
entities''). Moreover, Harris Funeral Homes must be considered
alongside the Supreme Court's opinion in Bostock. In that case, the
Court acknowledged the potential application of Title VII's ``express
statutory exception for religious organizations''; of the First
Amendment, which ``can bar the application of employment discrimination
laws'' in certain cases; and of RFRA, ``a kind of super statute'' which
``might supersede Title VII's commands in appropriate cases.'' 140 S.
Ct. at 1754 (noting that ``how these doctrines protecting religious
liberty interact with Title VII are questions for future cases too'').
Commenters also mistakenly argued that accommodations are
foreclosed because participation in these Federal financial assistance
programs and activities is not ``fundamental'' or ``central'' to any
religious activity or obligation. None of the applicable accommodation
statutes requires the religious activity or obligation to be central or
fundamental. Doing so would put the Government in the difficult
position of making inherently religious judgments. See, e.g., Emp't
Div., Dep't of Human Res. of Ore. v. Smith, 494 U.S. 872, 887 (1990)
(``Judging the centrality of different religious practices is akin to
the unacceptable business of evaluating the relative merits of
differing religious claims.'' (internal quotation marks omitted)). The
definition of ``religious exercise'' that applies to RLUIPA and RFRA
``includes any exercise of religion, whether or not compelled by, or
central to, a system of religious belief.'' 42 U.S.C. 2000cc-5(7)(A)
(RLUIPA); 42 U.S.C. 2000bb-2(4) (RFRA incorporating the definition from
RLUIPA). And RFRA accommodations are available whether or not
participation is fundamental or central,
[[Page 82082]]
even if the conduct is voluntary, as discussed in Parts II.C and II.F.
Contrary to commenters' assertions, any accommodation analyses
conducted in connection with the requirements of this final rule will
consider all relevant Establishment Clause principles and any relevant
impact on taxpayers' religious liberties. There is no basis to claim
that the Agencies and their intermediaries will not follow Federal law,
including the Establishment Clause. Indeed, DHS, DOJ, ED, HHS, HUD,
USAID, and USDA are all adding regulatory text in these provisions with
express references to constitutional limits, RFRA, and other Federal
laws. Additionally, the eight Agencies with prescribed text for notices
to faith-based organizations all expressly reference these Federal
laws, as discussed in Part II.G.3. Also, as discussed in Part II.F.2.a,
the Agencies disagree with the commenter that relied on ACLU of
Massachusetts v. Sebelius, which is distinguishable on legal and
factual grounds but does show how a faith-based organization can
receive an appropriate accommodation as the highest ranking applicant
under one version of a program but not receive an accommodation under
another version where other providers rank higher. See ACLU of Mass. v.
U.S. Conference of Catholic Bishops, 705 F.3d 44, 49-51 (1st Cir. 2013)
(summarizing facts).
For similar reasons, the Agencies disagree that these
accommodations should not be based on the Attorney General's
Memorandum. The Attorney General's Memorandum accurately describes
existing Federal law, including the relevant Establishment Clause
principles and the checks on religious exercise. Contrary to these
commenters' claims, it is well established that faith-based
organizations, not just individuals, are entitled to religious freedom.
See, e.g., Hobby Lobby, 573 U.S. at 707-09 (recognizing that
corporations can exercise religion under the Free Exercise Clause and
RFRA).
Commenters also mistakenly argued that the accommodation language
is foreclosed by third-party harms. As discussed in Part II.C.3.e,
third-party burdens do not categorically preclude accommodations under
RFRA. Indeed, Hobby Lobby rejected this argument. 573 U.S. at 729 n.37.
That case was the basis for the statement in the Attorney General's
Memorandum that ``the fact that an exemption would deprive a third
party of a benefit does not categorically render an exemption
unavailable.'' 82 FR at 49670, 49675 (citing Hobby Lobby).
The Agencies also disagree that the addition of accommodation
language to this final rule will create any third-party burdens beyond
what current law, as discussed above, already allows and, in some
cases, mandates. To the extent that third-party burdens are relevant to
a specific accommodation determination, the Agencies and their
intermediaries will consider such burdens. The Agencies and their
intermediaries will consider, for example, the impact on the health and
well-being of beneficiaries when determining whether there is a
compelling interest in a particular program requirement and whether
less restrictive means are available. The Agencies also incorporate
their discussions of these issues in Parts II.C and II.F.
The Agencies disagree that nondiscrimination laws categorically bar
accommodations. Rather, like any other accommodation, they are
available in particular cases, based on context and applicable Federal
law. See, e.g., Hobby Lobby, 573 U.S. at 729 n.37; World Vision, 31 Op.
O.L.C. 162 (concluding that RFRA was reasonably construed to require
that an organization be exempt from a statute's religious
nondiscrimination provision).
The Agencies oppose discrimination and seek to protect
beneficiaries from it. The Agencies reiterate that this final rule
continues to expressly prohibit discrimination against beneficiaries on
the basis of religion, a religious belief, a refusal to hold a
religious belief, or a refusal to attend or participate in a religious
practice. The Agencies' other program requirements bar discrimination
on other protected bases. If an accommodation were sought from those
requirements based on a sincerely held religious belief, the Agencies
and their intermediaries would evaluate it appropriately under existing
law, including without ``religious hostility.'' Masterpiece Cakeshop,
138 S. Ct. at 1724, 1729-31.
Although evaluation of accommodation requests is context-dependent,
the Agencies cannot conceive of granting such an accommodation to
discriminate based on race. As the Supreme Court has recognized, there
is a compelling interest in eradicating racial discrimination, and the
Court has frequently upheld outright prohibitions on such
discrimination. Bob Jones Univ., 461 U.S. 574; see also Newman, 390
U.S. 400 (private lawsuit to enjoin racial discrimination at
restaurants was ``vindicating a policy that Congress considered of the
highest priority''). The Agencies recognize that ``[r]acial bias is
distinct.'' Pena-Rodriguez v. Colorado, 137 S. Ct. 855, 868 (2017).
Indeed, a long history of the Supreme Court's ``decisions demonstrate
that racial bias implicates unique historical, constitutional, and
institutional concerns.'' Id.
The Agencies will evaluate any other accommodation request under
the applicable law and will not prejudge the outcome of that context-
specific analysis. Accommodations are available from certain
nondiscrimination provisions in certain contexts, as the World Vision
opinion explained. See Part II.C. Under RFRA, for example, it is
possible that there is no compelling governmental interest in imposing
the burden at issue, that a general compelling interest is not
compelling ``to the person,'' or that there is a less restrictive means
of furthering the interest. The Agencies and their intermediaries will
consider all of these factors and the impact of any accommodation, as
appropriate under existing law.
For context, the Agencies have considered the example of a Jewish
ritual bath, known as a ``mikveh.'' In addition to the ritual aspects
of the mikveh, it provides a unique setting for a trusted female
community member to identify signs of domestic violence and medical
conditions, including cancers, on religious women who often dress in
religiously modest clothing at all other times. See, e.g., Anna
Behrmann, I Spotted a Lump when Preparing for My Ritual Bath, BBC News,
July 2, 2019, https://www.bbc.com/news/world-middle-east-47734665.
However, a mikveh will often exclude some people based on the
sponsoring organization's sincerely held religious beliefs, such as
serving only co-religionists.
Like all faith-based organizations, the added accommodation
language tells an organization that runs such a mikveh that it can
apply for Federal financial assistance related to identifying domestic
violence or cancer, even if its religious exercise did not permit
compliance with all program requirements. The relevant Agency would
then consider the accommodation request in the context of that program,
as required or permitted under existing Federal accommodation laws.
Whether the Agency grants the accommodation will depend on the facts
and circumstances. Whether the mikveh organization receives the award
will ultimately depend on even more facts and circumstances, including
the quality and impact of the proposed use of funds. But refusal to
consider such a request--as some commenters would have the Agencies
do--would be
[[Page 82083]]
contrary to Federal law. The accommodation language in this final rule
follows existing law in allowing context-specific determinations.
The accommodation language is consistent with the other cases cited
by commenters. Commenters mistakenly rely on Christian Legal Society v.
Martinez, 561 U.S. 661, for the principle that the U.S. Constitution
bars the Government from directly funding or providing aid to private
institutions that engage in discrimination. Martinez held only that the
First Amendment does not preclude a State university from applying an
``accept-all-comers'' policy to any group seeking access to a limited
public forum, including a religious group. Id. at 667-69, 675-90. It
did not hold that the First Amendment precluded the State university
from granting an accommodation to a religious group, and it did not
address the application of an accommodation statute such as RFRA. See
id. at 697 n.27 (explaining that the student group's Free Exercise
Clause claim was unsuccessful under Smith).
Commenters also relied on Norwood v. Harrison, which did not
involve any claim for religious accommodation. 413 U.S. at 464-66. The
Supreme Court recognized in Norwood that its analysis regarding
providing textbooks to non-sectarian private schools that racially
discriminate was different from the applicable analysis for providing
textbooks or funding to religious schools. Id. at 468-70. As the Court
recognized, when it comes to assisting religious schools, ``our
constitutional scheme leaves room for `play in the joints,' '' meaning
the Government often has discretion to provide assistance to religious
entities that is neither required by the Free Exercise Clause nor
prohibited by the Establishment Clause. Id. at 469. The Court concluded
that religious beliefs are afforded protections not afforded to bias on
other grounds. Id. at 470. That is consistent with the accommodation
language in this final rule.
Commenters also relied on Dole v. Shenandoah Baptist Church, 899
F.2d at 1392, which further demonstrates the need for context-specific
analyses. In that case, a religious school argued that it was entitled
to an accommodation--applying the free exercise test prevailing at the
time, which is now incorporated into RFRA--that would allow the school
to pay male teachers more than female teachers, rather than comply with
the FLSA. Id. at 1397. The court evaluated the contours of the
articulated religious beliefs, but found that they would be minimally
burdened by complying with the FLSA, found a compelling governmental
interest in that context, found that granting an exemption would be
contrary to that compelling interest, and found that compliance with
the FLSA was the least restrictive means of achieving the Government's
aims. Id. at 1397-99. That reinforces the appropriateness of the
context-specific analyses that the Agencies and their intermediaries
will conduct under this final rule, which they were required to conduct
under existing Federal law even without the accommodation language.
The Agencies also note that the analysis in Dole pre-dated RFRA, so
some of the specific considerations may no longer apply. For example,
it is not appropriate under RFRA to require that the challenged
requirement ``cut to the heart of [the organization's] beliefs.'' Id.
at 1397. The Agencies further note that Dole applied the ministerial
exception in 1990, id. at 1396-97, without the benefit of recent
Supreme Court cases, which could affect the analysis. See Our Lady of
Guadalupe Sch. v. Morrissey-Berru, 140 S. Ct. 2049 (2020); Hosanna-
Tabor Evangelical Lutheran Church & Sch. v. EEOC, 565 U.S. 171 (2012).
Moreover, the Dole case recognized that accommodations and exemptions--
such as the ones referenced in this final rule--can be
``constitutionally permissible.'' 899 F.2d at 1396 (citing cases).
The Agencies disagree that the accommodation language will allow
faith-based organizations to use religious faith as a pretext for
discrimination. Existing accommodation principles appropriately screen
for pretext while balancing respect for religious autonomy. For
example, commenters relied on Hamilton v. Southland Christian School,
Inc., 680 F.3d 1316 (11th Cir. 2012), in which the appeal hinged on
whether the teacher had been fired because she had premarital sexual
relations or because of her pregnancy. Id. at 1319-21. The court found
a genuine issue of fact on that issue and remanded the case for further
proceedings. Also, the Supreme Court has explained that the compelling
interest test prevents discrimination on the basis of race in hiring
from being ``cloaked as religious practice to escape legal sanction.''
Hobby Lobby, 573 U.S. at 733.
The Agencies note that, in rare but appropriate cases, pretext can
be screened by challenging the religiosity or sincerity of a claimed
religious exercise.\63\ To be sure, such challenges should be narrow,
rare, and subject to all of the other protections of the Religion
Clauses and RFRA, including that the Government cannot question the
truth or reasonableness of the believer's line-drawing. See, e.g.,
United States v. Ballard, 322 U.S. 78, 86-88 (1944) (observing that the
First Amendment prohibits evaluating ``the truth or falsity of the
religious beliefs or doctrines''); Attorney General's Memorandum, 82 FR
at 49674 (citing cases).
---------------------------------------------------------------------------
\63\ See, e.g., Ballard, 322 U.S. at 79-83 (affirming jury
instruction asking whether fraud defendants ``honestly and in good
faith believe[d]'' that they were ``divine messengers'' who could
heal ailments and diseases and had done so hundreds of times);
United States v. Quaintance, 608 F.3d 717, 721-23 (10th Cir. 2010)
(Gorsuch, J.) (explaining that extensive evidence showed criminal
defendants who sold large quantities of marijuana ``were motivated
by commercial or secular motives rather than sincere religious
conviction,'' including inducting a co-conspirator into the religion
which they founded in order to ``insulate their drug transactions
from confiscation'').
---------------------------------------------------------------------------
Contrary to certain comments, the Agencies cannot conclude that
compliance with nondiscrimination laws will never substantially burden
a faith-based organization's sincerely held religious beliefs. The
World Vision opinion (discussed above and in Part II.C) and the
examples discussed above demonstrate that nondiscrimination laws can
impose such burdens. The Agencies cannot dismiss requests for
accommodations from nondiscrimination laws categorically. See, e.g.,
Thomas v. Review Bd. of Indiana Employment Sec. Div., 450 U.S. 707,
713-16 (1981).
Some commenters criticized potential accommodations that would
exempt faith-based providers from various laws in various contexts,
including reproductive health requirements. Such requirements tend to
arise in the context of programs funded or administered by HHS, many
under the Public Health Service Act, 42 U.S.C. 201 et seq. There are
Federal conscience protection statutes, for example, specific to the
recipients of funds under the Public Health Service Act, or to programs
administered by the Secretary of HHS, that bar discrimination against
health care entities or personnel that refuse to participate in certain
health services or research activities on the basis of religious belief
or moral conviction.\64\
[[Page 82084]]
Because of the applicable prohibitions, these Federal conscience
provisions may effectively require religious or moral accommodations
with respect to reproductive health requirements in certain
circumstances. The Agencies also note that accommodations from such
reproductive health requirements are discussed further in Part II.F.2.a
below.
---------------------------------------------------------------------------
\64\ For example, the Church Amendments, 42 U.S.C. 300a-7, apply
to entities funded under the Public Health Service Act and two other
laws administered by HHS and protect the conscience rights of
individuals and entities that object to performing or assisting in
the performance of abortion or sterilization procedures if doing so
would be contrary to the provider's religious beliefs or moral
convictions. The Church Amendments also prohibit (1) recipients of
HHS funds for biomedical or behavioral research from discriminating
against health care personnel who refuse to perform or assist in the
performance of any health care service or research activity on the
grounds that their performance or assistance in the performance of
such service or activity would be contrary to their religious
beliefs or moral convictions, and (2) individuals from being
required to perform or assist in the performance of any part of a
health service program or research activity funded in whole or in
part under a program administered by HHS if their performance or
assistance in the performance of such part of such program or
activity would be contrary to their religious beliefs or moral
convictions.
Section 245 of the Public Health Service Act, 42 U.S.C. 238n,
prohibits the Federal Government and any State or local government
receiving Federal financial assistance from discriminating against
any health care entity (which includes both individuals and
institutions) on the basis that the entity (1) refuses to undergo
training in the performance of induced abortions, to require or
provide such training, to perform such abortions, or to provide
referrals for such training or such abortions; (2) refuses to make
arrangements for such activities; or (3) attends (or attended) a
post-graduate physician training program, or any other program of
training in the health professions, that does not (or did not)
perform induced abortions or require, provide, or refer for training
in the performance of induced abortions, or make arrangements for
the provision of such training.
The Weldon Amendment, a rider in HHS's annual appropriation,
provides that ``[n]one of the funds made available in this Act may
be made available to a Federal agency or program, or to a State or
local government, if such agency, program, or government subjects
any institutional or individual health care entity to discrimination
on the basis that the health care entity does not provide, pay for,
provide coverage of, or refer for abortions.'' E.g., Further
Consolidated Appropriations Act, 2020, Public Law 116-94, div. A,
sec. 507(d), 133 Stat. 2534, 2607 (Dec. 20, 2019).
Section 1303(b)(4) of the Affordable Care Act, 42 U.S.C.
18023(b)(4), provides that ``[n]o qualified health plan offered
through an Exchange may discriminate against any individual health
care provider or health care facility because of its unwillingness
to provide, pay for, provide coverage of, or refer for abortions.''
Section 1553(a) of that Act, 42 U.S.C. 18113(a), provides that
``[t]he Federal Government, and any State or local government or
health care provider that receives Federal financial assistance
under this Act (or under an amendment made by this Act) or any
health plan created under this Act (or under an amendment made by
this Act), may not subject an individual or institutional health
care entity to discrimination on the basis that the entity does not
provide any health care item or service furnished for the purpose of
causing, or for the purpose of assisting in causing, the death of
any individual, such as by assisted suicide, euthanasia, or mercy
killing.''
---------------------------------------------------------------------------
Other accommodation statutes require context-specific analysis.
Under RFRA, for example, the Agencies and intermediaries would consider
the sincerity of the professed belief, the pressure to compromise that
belief posed by conditioning the Federal financial assistance on
compliance with the program requirement, the scope of the program
requirement, the Government's interest in that requirement, any
exemptions or accommodations that would make the interest less
compelling, and the availability of less restrictive means to achieve
that interest. Based on that analysis, they will determine whether a
faith-based organization must comply with the requirement as written,
can comply in a different way, must provide a referral if appropriate,
or must take some other action in order to justify the accommodation.
Where there is no compelling interest in the service or program
requirement, the faith-based organization may be able to deny the
service or provide the service without that requirement. Where there is
a compelling interest in the service or program requirement, the Agency
or intermediary will ensure that the compelling interest is satisfied,
either through the faith-based organization or some other less
restrictive means. Some accommodation requests will have to be denied.
That is how RFRA has always worked. This final rule does not change
that analysis or prejudge the outcome in any case.
The Agencies disagree that their accommodation language is vague or
creates confusion. Consistent with the legal standards discussed above
and in Parts II.C and II.F, the Agencies are ensuring that context-
specific considerations, including countervailing considerations, are
analyzed whenever determining whether to grant any accommodations. As
part of this analysis, the Agencies will consider ``undue hardship''
whenever it is relevant. This final rule mentions some potential
accommodations but does not contain specific examples due to the
context-specific nature of that analysis.
Additionally, the Agencies disagree that they created confusion by
adding two references to religious accommodations. This language is
being added in the two places where it applies: (1) Eligibility and (2)
compliance. Rather than creating confusion, this wording creates
greater clarity. This added language provides expressly that
accommodations are available to alleviate burdens on faith-based
providers from program requirements, where warranted under existing
Federal law. As explained, all of the commenters' concerns regarding
such accommodations--including discrimination, denial of service,
discomfort, importance of the requirement to the government program,
and compelling interest--will be considered and addressed when the
Agencies and intermediaries determine whether to grant an
accommodation. With regard to very important program requirements, a
faith-based organization may be less likely to receive an
accommodation, but circumstances may still warrant one, as discussed
above and in Parts II.C and II.F. Such accommodations are not contrary
to Congressional intent. For example, RFRA ``operates as a kind of
super statute, displacing the normal operation of other Federal laws,''
Bostock, 140 S. Ct. at 1754, unless Congress expressly provides
otherwise.
The Agencies are committed to protecting the religious liberty of
faith-based organizations and beneficiaries equally. But express
accommodations for beneficiaries are beyond the scope of this final
rule. This final rule addresses accommodations that relieve government-
imposed burdens on faith-based organizations. For reasons discussed
elsewhere, the Agencies do not believe that this final rule is likely
to impose substantial burdens on beneficiaries, see Parts II.C.1,
II.C.2, and II.C.3.e, particularly in the context of indirect Federal
financial assistance, see Part II.D, although the Agencies do not rule
out that possibility in any particular case. Also, the Agencies did not
claim that beneficiary accommodations were not warranted because ``few
will need them.'' They expressly disavow such reasoning. Beneficiaries
are entitled to accommodations, where appropriate, from government-
imposed burdens.
Only DOL and DHS addressed accommodations in the 2016 final rule.
They did so in a manner consistent with this final rule. DOL retained a
provision that provided for accommodations consistent with the
Constitution, which ``means that otherwise valid religious
accommodations do not violate the religious nondiscrimination
requirement in this regulation.'' 81 FR at 19393; id. at 19422 (DOL, 29
CFR 2.33(a)). DHS added a similar provision in the 2016 final rule. Id.
at 19411 (DHS, 6 CFR 19.3(d)); see also 80 FR 47284, 47297 (Aug. 6,
2015) (proposing such language); 73 FR 2187, 2189 (Jan. 14, 2008)
(proposing such language initially). No commenter has pointed to any
issues or harms due to those provisions.
The Agencies also disagree that the accommodation language in this
final rule, in combination with provisions that permit religious
organizations to maintain their religious character and expression,
will necessarily result in faith-based organizations' improperly
proselytizing or expressing religious views while providing federally
funded
[[Page 82085]]
services. Each Agency has retained its prohibition on proselytizing in
direct Federal financial assistance programs and activities, and the
Agencies do not foresee granting accommodations that would exempt
faith-based organizations from that prohibition. As discussed in Part
II.D, recipients of indirect Federal financial assistance are permitted
to engage in explicitly religious activities, including
proselytization, within such programs, as they were under the 2016
final rule. Also, faith-based recipients of both direct and indirect
programs retain their rights of expression, including to express
religious views, as discussed in Part II.G.5. The accommodation
language does not change these aspects of the Agencies' rules.
The Agencies also disagree that the accommodation language--
combined with the other changes addressed in Parts II.F and II.G--will
increase preferential treatment for religious organizations. As
explained, the accommodation language merely clarifies existing law.
Whatever preferential treatment might result would have resulted anyway
under existing law.
For all of these reasons, the Agencies' addition of the
accommodation language is reasonable and not unwarranted, arbitrary, or
capricious.
Changes: None.
Affected Regulations: None.
F. Discrimination on the Basis of Religious Character or Exercise
Existing regulations required eight of the Agencies and their
intermediaries not to discriminate in selection of service providers
based on ``religious character'' or ``affiliation.'' VA's existing
parallel provision barred discrimination based on ``religion or
religious belief or lack thereof.'' 38 CFR 50.4. Existing regulations
for DHS, USAID, DOJ, DOL, and HHS also required any grant, document,
agreement, covenant, memorandum of understanding, policy, or regulation
used by the Agencies (and, for some Agencies, their intermediaries) not
to ``disqualify'' any organization based on its ``religious character''
or ``affiliation.'' USDA, VA, ED, and HUD did not have such an existing
provision on disqualification.
In the NPRMs, all Agencies proposed changes relating to such
provisions. With regard to discrimination, DHS and HUD proposed to
include prohibitions when based on religious ``character,''
``affiliation,'' or ``exercise,'' while the other Agencies proposed to
include a prohibition when based on religious ``exercise'' or
``affiliation'' but not religious ``character.'' With regard to
disqualification, eight Agencies proposed to include prohibitions when
based on ``religious exercise'' or ``affiliation,'' USDA omitted that
language from its proposal, and no Agency proposed a prohibition when
based on ``religious character.'' Eight Agencies proposed to add that
``religious exercise'' for multiple provisions, including these
provisions, incorporates the statutory definition from RLUIPA that also
applies to RFRA.
HHS's NPRM provided the most extensive explanation for these
proposed changes. It explained that it was proposing to delete
``religious character'' from these provisions because there was not a
body of law providing legal guidance on that standard and because the
phrases ``religious character'' and religious ``affiliation'' created
confusion. 85 FR at 2979. HHS explained that it was proposing to change
the language to ``religious exercise'' because that phrase is defined
by Congress in RLUIPA and used in RFRA and RLUIPA, and because there is
an ``extensive legal framework'' and ``body of law'' providing legal
guidance on that standard. Id. HHS also expressed concern that the
phrase ``religious character'' created confusion because the phrase
would presumably have a different meaning than ``religious
affiliation'' or ``exercise,'' but ``it is unclear what that
distinction would be.'' Id.
1. ``Religious Character''
Summary of Comments: Several commenters stated that these
provisions should continue to prohibit discrimination and
disqualification based on ``religious character,'' which is the
standard in Trinity Lutheran. They explained that Trinity Lutheran
outlined the Free Exercise Clause's ``blanket ban'' on discrimination
based on ``religious character.''
With respect to HHS's explanation, some commenters responded that
there is a well-established body of law regarding the definition of
``religious character,'' including that this term was a central focus
of Trinity Lutheran. Commenters also stated that the terms religious
``character'' and ``exercise'' have unique meanings, as articulated in
Trinity Lutheran and other First Amendment cases. They then pointed to
the language in Trinity Lutheran that the bright-line bar applies to
laws that ``single out the religious for disfavored treatment,'' 137 S.
Ct. at 2021, which the commenters interpreted to mean discrimination
based on religious character.
Response: The Agencies agree that Trinity Lutheran subjects
discrimination based on ``religious character'' to the ``most exacting
scrutiny.'' 137 S. Ct. at 2021. After the comment period closed, the
Supreme Court reaffirmed that holding in Espinoza, 140 S. Ct. at 2255.
The body of law confirming this First Amendment principle has thus
developed even further. The Agencies also note that DHS and HUD had
proposed to keep the phrase ``religious character'' in their
nondiscrimination provisions. 85 FR at 2896 (DHS, 19.3(b)); id. at 8223
(HUD, 5.109(c)).
Nevertheless, the Agencies continue to be concerned that the term
``religious character'' may not be entirely clear. The Supreme Court
has not defined ``religious character.'' It has held, however, that
discrimination against ``any [grant] applicant owned or controlled by a
church, sect, or denomination of religion,'' Trinity Lutheran, 137 S.
Ct. at 2017, 2021, or any school ``owned or controlled in whole or in
part by any church, sect, or denomination,'' Espinoza, 140 S. Ct. at
2252, 2255, constitutes discrimination on the basis of ``religious
character.'' In some cases, the Court has also appeared to equate
``religious character'' and ``religious status,'' without explaining
whether there are any differences between the two concepts. Espinoza,
140 S. Ct. at 2255, 2260 (``character''); id. at 2254-57, 2262
(``status''); Trinity Lutheran, 137 S. Ct. at 2021, 2022, 2024
(``character''); id. at 2019, 2020, 2021 (``status''). The Court has
contrasted those terms with religious ``use,'' which is a similarly
undefined reference to religious conduct. Espinoza, 140 S. Ct. at 2255-
57. Also, some Justices have questioned the ability of courts--let
alone regulatory agencies and their intermediaries--to apply the
distinction between ``religious character'' and ``religious use.'' \65\
---------------------------------------------------------------------------
\65\ See Espinoza, 140 S. Ct. at 2257; id. at 2275-78 (Gorsuch,
J., concurring); Trinity Lutheran, 137 S. Ct. at 2025-26 (Gorsuch,
J., concurring in part, joined by Thomas, J.) (questioning ``the
stability of such a line'').
---------------------------------------------------------------------------
Despite these concerns, the Agencies agree with the commenters that
there is a body of case law protecting against discrimination based on
``religious character.'' To avoid tension with this case law, all of
the Agencies finalize these provisions to include the phrase
``religious character.'' For purposes of these provisions, the Agencies
interpret discrimination based on ``religious character'' to mean
distinctions based on the organization's religious status, including as
a church, sect, denomination, or comparable classification of any
religion; the organization's control by a church, sect, or
denomination; the organization's identification as religious; or the
[[Page 82086]]
organization's operation based on religious principles. An agency would
violate these provisions if it used an applicant's religious character
as a basis to deny the application for Federal financial assistance
entirely, or to penalize the applicant by, for example, awarding it
fewer points in scoring that might be part of determining who will
receive the assistance.
The Agencies also include the word ``affiliation'' in their final
rules, prohibiting discrimination based on an organization's
affiliation with--even if it is not controlled by--a religious
denomination, sect, umbrella organization, or other faith-based
organization. See Attorney General's Memorandum, Principles 6, 8.
Certain organizations might not describe themselves as religious but
still could be affiliated with a religious entity. Discrimination
against such organizations on the basis of their affiliation raises
many of the same concerns and issues raised by discrimination against
the religious affiliates directly. See Exclusion of Religiously
Affiliated Schools from Charter-School Grant Program, 44 Op. O.L.C. __,
*3 (Feb. 18, 2020) (``The religious-affiliation restriction in [20
U.S.C. 7221i(2)(E)] broadly prohibits charter schools in the program
from associating with religious organizations. . . . That is
discrimination on the basis of religious status.''). By prohibiting
discrimination based on both religious ``character'' and
``affiliation,'' the Agencies create consistency across their final
rules.
The Agencies disagree, however, that Trinity Lutheran imposes a
``blanket ban'' that is qualitatively different from other Free
Exercise Clause and RFRA standards that trigger strict scrutiny. The
Supreme Court left open in Trinity Lutheran whether discrimination on
the basis of religious character amounted to discrimination on the
basis of religious belief, which `` `is never permissible.' '' 137 S.
Ct. at 2024 n.4 (quoting Lukumi, 508 U.S. at 533); see also Masterpiece
Cakeshop, Ltd. v. Colo. Civil Rights Comm'n, 138 S. Ct. 1719, 1731-32
(2018) (government ``cannot impose regulations that are hostile to the
religious beliefs of affected citizens''). Instead, as noted, the Court
applied the ``most rigorous scrutiny,'' Trinity Lutheran, 137 S. Ct. at
2024 (internal quotation marks omitted), and determined that the
discrimination in that case could not ``survive strict scrutiny in any
event,'' id. at 2024 n.4. See also Espinoza, 140 S. Ct. at 2260 (``When
otherwise eligible recipients are disqualified from a public benefit
`solely because of their religious character,' we must apply strict
scrutiny.'') (quoting Trinity Lutheran, 137 S. Ct. at 2021). The
Agencies do not in this final rule take a position on whether the First
Amendment categorically prohibits discrimination against religious
character.
Finally, for consistency and completeness, any Agency that requires
notice of these provisions using prescribed text whose terms were
included in an Appendix to the regulatory text in the Code of Federal
Regulations is also adding ``religious character'' to that notice.
Changes: All Agencies include ``religious character'' in these
substantive provisions in this final rule, as DHS and HUD had proposed
regarding discrimination, and in any applicable notice. USDA also
includes religious ``affiliation'' in its substantive provision
prohibiting disqualification.
Affected Regulations: 2 CFR 3474.15(b)(2), (b)(4), 34 CFR
75.52(a)(2), (a)(4), 76.52(a)(2), (a)(4), 34 CFR part 75 Appendix A
(ED); 6 CFR 19.3(e), 19.4(c), 6 CFR part 19 Appendix A (DHS); 7 CFR
16.3(a), (d)(3), 7 CFR part 16 Appendix A (USDA); 22 CFR 205.1(a), (f)
(USAID); 24 CFR 5.109(h), 24 CFR part 5 Appendix A (HUD); 28 CFR
38.4(a), 38.5(d), 28 CFR part 38 Appendix A (DOJ); 29 CFR 2.32(a), (c),
29 CFR part 2 Appendix A (DOL); 38 CFR 50.2(a), (e), 38 CFR part 50
Appendix A (VA); 45 CFR 87.3(a), (e), 45 CFR part 87 Appendix A (HHS).
2. ``Religious Exercise''
a. Scope of ``Religious Exercise''
Summary of Comments: The Agencies received a variety of comments on
the proposal to prohibit discrimination in selection and
disqualification on the basis of ``religious exercise.'' Several
commenters argued that these provisions should not use the phrase
``religious exercise'' from RFRA because some discrimination is
permitted based on ``religious exercise.'' They reasoned that RFRA
applies a case-specific test that allows awarding agencies to
discriminate based on ``religious exercise,'' when there is no
substantial burden or when the law satisfies strict scrutiny. They
argued that the bright-line nondiscrimination rule from Trinity
Lutheran should not apply to ``religious exercise'' without RFRA's
fact-specific inquiry.
Some commenters recognized the body of case law regarding the
definition of ``religious exercise,'' which HHS referenced in its
preamble, but argued that using ``religious exercise'' for a blanket
ban on discrimination here does not ``reflect'' that body of law. Some
commented that there was no confusion in the provisions because
``religious exercise'' and ``character'' have distinct meanings, as
articulated in Trinity Lutheran and other First Amendment cases. They
then pointed to the language in Trinity Lutheran, 137 S. Ct. at 2021,
that distinguished neutral laws of general applicability that implicate
``religious exercise''--which commenters said can take many forms and
against which discrimination may be allowed--from laws that
discriminate based on religious character. Such neutral laws of general
applicability that burden ``religious exercise'' are subject to the
fact-sensitive test from RFRA that, commenters said, can be difficult
to apply and requires consideration of the burden on the religious
entity, of the Government's interest, and of available alternative
means.
Some commenters argued that these provisions barring discrimination
in selection of service providers for Agency programs can use
``religious exercise'' only if they have RFRA-related limiting
language. Without such limiting language, commenters claimed that these
provisions would lead to blanket exemptions that are not required by
the Free Exercise Clause or RFRA. Commenters expressed concern that
such exemptions would tilt the balance ``far too heavily in the
direction of catering to religious service providers rather than to
program beneficiaries,'' which would be contrary to these programs'
central goal of providing services to people in need. A few commenters
argued that this change to ``religious exercise'' would likely infringe
on the religious-freedom rights and well-being of program
beneficiaries, with some adding that government programs can be a
matter of life and death for some beneficiaries. Other commenters were
concerned that the use of ``religious exercise'' without any limiting
language would enable faith-based organizations to receive Federal
funding even if they are unwilling to abide by any program requirement,
no matter how essential it is to furthering a compelling governmental
interest and no matter how narrowly tailored. Multiple commenters said,
for example, that organizations could opt out of providing services to
individuals who do not adhere to the provider's religious beliefs,
including denying access to condoms in an HIV-prevention program to
people whose relationships the provider deems sinful, or might make
non-religious beneficiaries ``uncomfortable'' accessing the federally
funded services. Another commenter argued that it is not discrimination
to
[[Page 82087]]
exclude faith-based organizations whose religious exercise precludes
fulfilling program requirements to an extent that would harm
beneficiaries, just as the Agencies can exclude any non-religious
providers that will not fulfill such program requirements.
Several commenters were concerned that this change would impose
burdens on third parties contrary to RFRA and the Establishment Clause.
Some of these commenters argued that religious exemptions and
accommodations are not permitted when they harm third parties--citing
Hobby Lobby, 573 U.S. 682, Justice Kennedy's concurrence in Hobby
Lobby, 573 U.S. at 736, Justice Ginsburg's concurrence in Holt v.
Hobbs, 574 U.S. at 370, and Estate of Thornton, 472 U.S. 703--and
added, without citation, that this is ``all the more true where the
harm is government funded.'' Others added that Hobby Lobby emphasized
that accommodation was appropriate where beneficiaries continued
receiving the benefits and faced minimal hurdles, whereas an exemption
from a program requirement may be inappropriate if it failed to protect
beneficiaries as effectively as non-accommodation. One commenter added
that the Agencies must not create exemptions that give grantees the
right to decline to provide services, which amounts to giving them
``the right to use taxpayer money to impose [their beliefs] on
others,'' quoting ACLU of Massachusetts v. Sebelius, 821 F. Supp. 2d
474, 488 n.26 (D. Mass. 2012), vacated as moot, ACLU of Mass. v. U.S.
Conference of Catholic Bishops, 705 F.3d 44 (1st Cir. 2013). Some
commenters argued that such exemptions would violate the Establishment
Clause by ``devolv[ing] into something unlawful'' under Corporation of
Presiding Bishop, 483 U.S. 327, ``overrid[ing] other significant
interests,'' or ``impos[ing] unjustified burdens on other[s]'' under
Cutter, 544 U.S. at 722, 726. Some also commented that the Agencies
failed to acknowledge or address the economic and non-economic costs
this change would create for beneficiaries and taxpayers.
For these reasons, some of these commenters added that using the
RFRA phrase ``religious exercise'' in this context fosters confusion
and is vague.
Several other commenters supported the change. These commenters
agreed with using the definition of ``religious exercise'' from RFRA
and RLUIPA. Some of these commenters argued that adding the phrase
``religious exercise'' emphasizes the important place that RFRA
continues to occupy in protecting claims of religious infringement,
including because it applies to ``any exercise of religion, whether or
not compelled by, or central to, a system of religious belief.'' 42
U.S.C. 2000cc-5(7)(A) (definition of ``religious exercise'' in RLUIPA,
incorporated by reference into definition of ``exercise of religion''
in RFRA, 42 U.S.C. 2000bb-2(4)). One of these commenters argued that
this change (along with others) ``send[s] a strong message . . . and
will enhance the participation of faith-based entities in administering
Federal programs, thereby providing more assistance to more needy
Americans.'' Another commenter argued that ``religious exercise'' adds
protection for the ``public dimension of religious activity'' whereas
``religious character'' applies only to the ``private dimension.''
Response: The Agencies agree that their regulations should be
updated to protect faith-based organizations from improper
discrimination based on their ``religious exercise,'' including to
protect the public dimension of religious activity. But they also agree
with the commenters that additional language is appropriate to clarify
the scope of this prohibition, tether it more closely to the applicable
Religion Clauses and RFRA standards, and ensure that this provision
only creates exemptions from program requirements based on RFRA when
there is proper case-specific balancing.
By ``discriminate'' in the selection process on the basis of an
organization's religious ``exercise'' and by ``disqualify'' faith-based
or religious organizations because of their religious ``exercise,'' the
Agencies' NPRMs intended to capture forms of discrimination that may be
more subtle than outright rejection of an organization because of its
religious character. The Supreme Court has long held that ``a law
targeting religious beliefs as such is never permissible'' and that
``if the object of a law is to infringe upon or restrain practices
because of their religious motivation,'' the law is subject to the most
rigorous form of scrutiny. Lukumi, 508 U.S. at 533. The Court has also
recognized that governmental hostility toward religion can be ``masked
as well as overt,'' and has thus instructed courts to survey
meticulously laws that burden religious exercise to determine whether
they are neutral and generally applicable. Id. at 534. ``Neutrality and
general applicability are interrelated, and . . . failure to satisfy
one requirement is a likely indication that the other has not been
satisfied.'' Id. at 531. Failure to satisfy either requirement triggers
strict scrutiny. Id. at 546; see also Central Rabbinical Congress, 763
F.3d at 194-95 (holding that strict scrutiny must be applied to law
that singled out specific religious conduct). A law is not neutral if
it singles out particular religious conduct for adverse treatment;
treats the same conduct as lawful when undertaken for secular reasons
but unlawful when undertaken for religious reasons; visits ``gratuitous
restrictions on religious conduct;'' or ``accomplishes . . . a
`religious gerrymander,' an impermissible attempt to target [certain
individuals] and their religious practices.'' Lukumi, 508 U.S. at 535,
538 (citation omitted); see Smith, 494 U.S. at 878. A law is not
generally applicable if, ``in a selective manner [it] impose[s] burdens
only on conduct motivated by religious belief,'' including by
``fail[ing] to prohibit nonreligious conduct that endangers [its]
interest in a similar or greater degree than . . . does'' the
prohibited conduct. Lukumi, 508 U.S. at 543. Even a neutral law of
general applicability can run afoul of the First Amendment if the
Government interprets or applies the law in a manner that discriminates
against religious exercise. See Lukumi, 508 U.S. at 537; Fowler v.
Rhode Island, 345 U.S. 67, 69-70 (1953) (government discriminatorily
enforced ordinance prohibiting meetings in public parks against a
religious group). In recognition of this case law and as the
appropriate policy choice, the Agencies expressly prohibit
discrimination and disqualification based on ``religious exercise.''
The Agencies do not believe that they have any legitimate interest in
disqualifying or discriminating against an organization for engaging in
conduct for religious reasons that the Agencies would tolerate if
engaged in for secular reasons.
Independently, the Agencies' NPRMs also intended that these
provisions apply so as to avoid RFRA issues. RFRA applies to these
regulations. See Parts II.C and II.E; World Vision, 31 Op. O.L.C. 162.
Discrimination against an organization at the selection phase, or
disqualification of an organization from a federally funded social
service program, based on conditions of participation that conflict
with an organization's sincerely held religious beliefs, may constitute
a substantial burden under RFRA by placing substantial pressure on the
organization to abandon those beliefs. Then, as with the First
Amendment standards discussed above, RFRA would trigger strict
scrutiny. Where religious conduct can be accommodated such that the
organization can meet the program requirements in a way that is
appropriate under the circumstances, the Agencies do not believe that
they will have a compelling governmental
[[Page 82088]]
interest in refusing to consider potential accommodations as part of
their grant application process. RFRA thus supports this provision.
To delineate the scope of protected religious conduct, the Agencies
agree with the comments that supported adopting the definition of
``religious exercise'' that applies to RFRA and RLUIPA. This definition
of ``religious exercise'' is set out clearly in RLUIPA, 42 U.S.C.
2000cc-5(7)(A), and incorporated by reference into RFRA, 42 U.S.C.
2000bb-2(4). This definition has been applied in an extensive body of
cases and is appropriate to complement the protections for religious
``character'' and ``affiliation.'' See Part II.F.1. Although the
Agencies recognize that the Supreme Court has tried to distinguish
between religious ``character'' and ``use,'' including in Trinity
Lutheran, 137 S. Ct. at 2021-24, they observe that the Court has also,
as noted above, recognized protection for religious exercise apart from
restrictions that burden religious character. See Lukumi, 508 U.S. at
533-34, 537, 543. The definition also reflects that RFRA provides
broader protection for religious exercise than the Supreme Court's
current Free Exercise Clause doctrine.
But the Agencies also recognize that many commenters apparently
interpreted the proposed addition of ``religious exercise'' more
broadly than intended. The Agencies did not intend in their NPRMs to
suggest that faith-based organizations must be deemed eligible for
grants when they are unable or unwilling to meet a particular program's
requirements under the circumstances, even with an appropriate
accommodation. Thus, a grant-awarding agency may decide, for example,
to disqualify a faith-based organization that, taking into account any
appropriate accommodation, cannot meet the program's requirements. By
the same token, it is not discrimination in favor of religious exercise
to grant an appropriate accommodation; the effect is to allow both
religious and secular organizations to participate as service providers
on terms that advance the purposes of the program. Moreover, as
discussed in greater detail in Parts II.C.3 and II.E, an appropriate
accommodation of religious exercise does not violate the Establishment
Clause, see, e.g., Cutter, 544 U.S. at 713-14, 719-24; Amos, 483 U.S.
at 334-34, and the Agencies exercise their discretion to include
accommodations in these provisions. The Agencies apply the same
analysis and discretion to their provisions that prohibit disqualifying
faith-based organizations because of their religious exercise.
The Agencies view appropriate accommodations to include any that
would be required by RFRA or other law, as well as any that would be
permitted by law and not be significantly burdensome for beneficiaries
and the Agency. The Agencies determine that there is no compelling
interest in denying such accommodations. By including express language
regarding such accommodations, the Agencies further their policy
determination to prohibit disqualification and discrimination in the
selection of providers based on religious exercise. The Agencies have
discretion to adopt this approach to avoid potential RFRA issues, as
discussed in greater detail in Parts II.C.3 and II.E above (discussing
Little Sisters and other authority). Moreover, as outlined below, the
Agencies expressly limit these provisions to accommodations that are
consistent with the Religion Clauses. The Agencies use the term
``appropriate accommodation'' to be clear that they do not incorporate
the standards for reasonable accommodations of disabilities or for
workplace accommodation of religion, such as the no-more-than-de-
minimis standard.
The Agencies also clarify that these provisions prohibit
discrimination in selection and disqualification from participation in
programs, but do not mandate that any faith-based organization receive
a grant, which would depend on all of the other relevant factors. The
Agencies provide for appropriate accommodation because they have
concluded that it is possible, and indeed beneficial, for a program to
afford such accommodations where appropriate in light of all the
circumstances. But the Agencies do not intend to create blanket
exemptions that could improperly favor faith-based organizations.
Accommodations should be granted only after case-specific analysis and
balancing.
In sum, the Agencies add language to these provisions in this final
rule to make clear that these nondiscrimination and non-
disqualification provisions prohibit discrimination against an
organization on the basis of religious exercise, which means
disfavoring an organization, including by failing to select an
organization, disqualifying an organization, or imposing any condition
or selection criterion that otherwise disfavors or penalizes an
organization in the selection process or has such an effect: (i)
Because of conduct that would not be considered grounds to disfavor a
secular organization, (ii) because of conduct that must or could be
granted an appropriate accommodation in a manner consistent with RFRA
or the Religion Clauses of the First Amendment to the Constitution, or
(iii) because of the actual or suspected religious motivation of the
organization's religious exercise. See Attorney General's Memorandum,
Principles 5, 7. That additional language is supported by the Free
Exercise Clause and RFRA, and it ensures that the nondiscrimination
provisions do not unreasonably supplant program requirements that apply
equally to faith-based and non-faith-based organizations. Just like
with ``religious character,'' this language ensures that the
prohibitions on discrimination and disqualification apply where strict
scrutiny would otherwise apply, and the Government has determined that
this scrutiny standard would not be met. For all of these reasons, the
Agencies conclude that prohibiting such discrimination and
disqualification does not improperly turn a case-specific standard into
a blanket exemption.
The Agencies believe that this additional language also addresses
the commenters' concerns regarding harms to beneficiaries' religious
liberty and well-being, including the concerns about third-party harms.
The Agencies disagree with the comments that religious exemptions and
accommodations are prohibited categorically when they impose any
burdens on third parties. Third-party burdens are relevant to
evaluating the least restrictive means under the First Amendment and
RFRA, and such burdens can be relevant to the Establishment Clause
analysis. But third-party burdens are not an automatic bar to
accommodations and exemptions, as Hobby Lobby held explicitly. 573 U.S.
at 729 n.37 (discussed in greater detail in Part II.C.3.e above).
The Agencies also disagree, as a factual matter, that these changes
would create cognizable economic or non-economic burdens on third
parties. Beneficiaries have no right to demand that the Government work
with any particular applicant for a grant, and certainly have no right
to demand that the Government discriminate against any applicant on the
basis of religion or religious exercise. Subsections (i) and (iii) of
these provisions, based on free exercise principles, merely prohibit
discrimination in selection or disqualification that involves targeting
or singling out religious exercise for disparate treatment from
comparable secular conduct. Such mandated equal treatment does not
impose impermissible burdens on third parties. Similarly, subsection
(ii) of these provisions, based on RFRA, merely
[[Page 82089]]
prohibits discrimination in selection or disqualification when there is
an appropriate accommodation, which, as discussed above, necessarily
addresses these concerns. The Agencies note that these provisions are
parallel to the provisions that prohibited discrimination based on
religious character, which did not impose burdens on third parties, and
which no commenter claimed had imposed such burdens. And the Agencies
determine that these provisions are the appropriate policy choice.
For the same reasons, the Agencies conclude that these provisions
are consistent with the Establishment Clause. Additionally, subsections
(i) and (iii) add standards for ``religious exercise'' that are
supported by the Free Exercise Clause and that alleviate burdens on
religious exercise, without burdening third parties to a degree that
counsels against providing the exemptions. See Part II.C.3 and II.E.
Subsection (ii) likewise alleviates burdens on religious exercise
consistent with the authority found in RFRA and expressly incorporates
the limits imposed by the Religion Clauses, which includes the
Establishment Clause. That language also resolves any comments that
opposed the proposed rules based on Establishment Clause and RFRA cases
regarding third-party burdens. Additionally, the Agencies have
maintained other limits addressing Establishment Clause concerns,
including limits on direct Federal funding of explicitly religious
activities. Based on their experience administering grant programs and
the comments received on this rulemaking, the Agencies do not believe
that these changes will create any third-party burdens that would
warrant further limiting such accommodations.
Based on their experience, the Agencies also disagree with comments
that these changes would permit grantees inappropriately to withhold
services or impose their religious beliefs on others. The Agencies have
been subject to RFRA since 1993. In that time, there is no indication
that any accommodation adopted under that statute resulted in such
harms, and no commenter has pointed to any instance of such actual
harms, as discussed in greater detail in Parts II.C and II.E. HHS, for
example, has responded to numerous accommodation requests in that time
and is not aware of any actual instance of these hypothetical issues
described by commenters. The ACLU of Massachusetts case cited by
commenters, which challenged an HHS contract to a faith-based
organization, does not demonstrate any such harms, is distinguishable
on many legal and factual grounds, and shows how a faith-based
organization can receive an appropriate accommodation as the highest
ranking applicant under one version of a program but not receive one
under another version where other providers rank higher. See 705 F.3d
at 49-51. The Agencies conclude that these provisions ensure equal
treatment for faith-based organizations in the selection and
disqualification processes for participation in federally funded
programs. And these provisions prohibit discrimination or
disqualification where ``appropriate accommodations'' are available.
Such accommodations would not allow organizations to inappropriately
withhold services or impose their religious beliefs on others. These
organizations, if selected, will also be bound to comply with the
applicable prohibitions of discrimination against a beneficiary on the
basis of religion and of engaging in explicitly religious activities.
See, e.g., 2 CFR 3474.15(f); 34 CFR 75.532(a)(1), 76.532(a)(1).
A commenter's example of denying access to condoms in an HIV-
prevention program is instructive. A program that required grantees to
provide condoms as part of the funded services would violate this final
rule if--on its face or as implemented--it disqualified or
discriminated against a grantee based on its religious character or
affiliation, it allowed secular but not religious grantees to opt out
of that program requirement, or it disqualified or discriminated
against a grantee based on its religious motivations for objecting to
that requirement. If the requirement did not violate those principles,
however, then the requirement to provide condoms could be imposed on
all organizations, unless it was determined that there was an
appropriate accommodation for a faith-based organization to decline to
provide such condoms. That determination would hinge on a fact-specific
inquiry into the relevant factors, such as the burden on the faith-
based organization's religious exercise from distributing the condoms,
the importance of condoms to the Government and the government program,
the demand for the faith-based organization to provide condoms contrary
to its religious exercise, the availability of condoms from other
sources, and the availability of alternatives to meet the program's
goals that would not violate the faith-based organization's religious
beliefs (e.g., other HIV-prevention methods or referral to entities
that will provide condoms). RFRA already requires the Agencies and
their intermediaries to engage in such analysis. These provisions in
this final rule merely reiterate that requirement. These provisions
also establish that the Agencies and their intermediaries must grant
both required and permissible accommodations, as appropriate.
In addition to all of the other reasons outlined in this section,
the Agencies determine that these provisions will benefit program
beneficiaries by removing eligibility barriers for qualified faith-
based organizations. In the Agencies' experience, some faith-based
organizations do not apply for grants when their eligibility is
unclear, both to avoid wasting time on applications when the grants at
issue could be denied for reasons related to their religion and to
avoid litigation regarding any grant they are awarded. These provisions
help to make such faith-based organizations' eligibility clearer.
Together, all of these changes strike the proper balance between
protecting faith-based organizations against discrimination or
disqualification based on established First Amendment and RFRA case
law, protecting beneficiaries, and ensuring that program requirements
are met with appropriate accommodations that are consistent with the
First Amendment and RFRA. Additionally, the Agencies define their terms
and explain how these standards complement each other. As a result,
these changes also address the commenters' concerns regarding vagueness
and confusion. Recognizing this protection for religious exercise also
ensures that there is no confusion for the Agencies, States, local
governments, other pass-through entities, applicants, grantees, or
beneficiaries.
Finally, because these standards align with constitutional and
statutory requirements that already applied to the prior provisions,
the Agencies determine that they would impose negligible additional
costs to beneficiaries and taxpayers. If anything, these changes will
save beneficiaries and taxpayers the costs of litigation and confusion
from the prior provisions' omission of the constitutional and RFRA
standards. And beneficiaries will benefit from the services that faith-
based organizations can provide without threat of unconstitutional
discrimination or disqualification. Even if these changes would impose
additional costs on beneficiaries and taxpayers, the Agencies would
still exercise their discretion to make these changes because this is
the appropriate policy choice.
[[Page 82090]]
Changes: All Agencies have added regulatory language to clarify
that these discrimination and disqualification provisions prohibit
discrimination on the basis of the organization's religious exercise,
which means to disfavor an organization, including by failing to select
an organization, disqualifying an organization, or imposing any
condition or selection criterion that otherwise disfavors or penalizes
an organization in the selection process or has such an effect: (i)
Because of conduct that would not be considered grounds to disfavor a
secular organization, (ii) because of conduct that must or could be
granted an appropriate accommodation in a manner consistent with RFRA
or the Religion Clauses of the First Amendment to the Constitution, or
(iii) because of the actual or suspected religious motivation of the
organization's religious exercise.
Affected Regulations: 2 CFR 3474.15(b)(2), (b)(4), 34 CFR
75.52(a)(2), (a)(4), (c)(3); 34 CFR 76.52(a)(2), (a)(4), (c)(3) (ED); 6
CFR 19.3(b), (e), 19.4(c) (DHS); 7 CFR 16.2, 16.3(a), (d)(3) (USDA); 22
CFR 205.1(a), (f) (USAID); 24 CFR 5.109(c), (h) (HUD); 28 CFR 38.4(a),
38.5(d) (DOJ); 29 CFR 2.32(a), (c), (d) (DOL); 38 CFR 50.2(a), (e)
(VA); 45 CFR 87.3(a), (e) (HHS).
b. Clarified Basis for Protecting ``Religious Exercise''
Summary of Comments: One commenter criticized multiple Agencies for
justifying the Agencies' proposals to protect faith-based organizations
from disqualification or discrimination on the basis of ``religious
exercise'' by reference to Trinity Lutheran. The commenter asserted
that Trinity Lutheran provided no justification for such protections
because it barred only discrimination based on ``religious character,''
not ``religious exercise.'' This commenter cited the preamble sections
that described the changes to the discrimination and disqualification
provisions.
Response: While the Agencies believe that their changes in this
regard are consistent with Trinity Lutheran, the Agencies did not
intend to suggest that the changes were necessarily required by that
decision. See 85 FR 2893 (DHS, Sec. 19.3(e)); id. at 2901 (USDA, Sec.
16.3(a)); id. at 2918 (USAID, Sec. 205.1(a)); id. at 2925 (DOJ, Sec.
38.4(a)); id. at 2933 (DOL, Sec. 2.32(a)); id. at 2942 (VA, Sec.
50.2(a)); id. at 2979 (HHS, Sec. 87.3(a)); id. at 8220 (HUD, Sec.
5.109(c)). Rather, the changes are warranted to alleviate tension with
the First Amendment and RFRA principles outlined in Part II.F.2.a
above, as well as tension with the related Principles 6, 8, 10-15, and
20 in the Attorney General's Memorandum. See 85 FR 2892-93 (DHS, Sec.
19.3(b), Sec. 19.4(c)); id. at 2901 (USDA, Sec. 16.3(d)); id. at 2925
(DOJ Sec. 38.5(d)); id. at 2918 (USAID, Sec. 205.1(f)); id. at 2933
(DOL, Sec. 2.32(c)); id. at 2942 (VA, Sec. 50.2(e)); id. at 2981
(HHS, Sec. 87.3(e)); id. at 3201 (ED, Sec. 3474.15(b)(2), (b)(4));
id. at 3203-04 (ED, Sec. 75.52(a)(2), (a)(4), Sec. 76.52(a)(2),
(a)(4)); id. at 8220 (HUD, Sec. 5.109(h)).
Changes: None.
Affected Regulations: None.
G. Rights of Faith-Based Organizations
1. Religious Symbols
For both direct and indirect Federal financial assistance, existing
regulations expressly allowed faith-based organizations to use space in
their facilities to provide federally funded social services without
removing religious art, icons, scriptures, or other religious symbols
from those facilities. DOL and ED regulations also provided that such
symbols need not be ``alter[ed],'' and DHS regulations provided that
the symbols need not be ``conceal[ed].'' In the NPRMs, all Agencies
proposed changes to adopt a uniform standard and clarify that faith-
based organizations may use space in their facilities to provide
federally funded social services without removing, altering, or
concealing religious symbols.
Summary of Comments: Several commenters stated that the display of
religious symbols could make some beneficiaries feel uncomfortable, and
that this might lead those beneficiaries to forgo needed social
services. In particular, commenters suggested that religious
minorities, non-believers, or LGBT individuals might feel unwelcome in
the presence of certain art, iconography, or scripture, including
symbols or messages that might be interpreted as critical of their
beliefs or conduct. Some commenters also argued that the presence of
religious symbols would convey a message of government endorsement of
religion, in violation of the Constitution's Establishment Clause. One
commenter argued that Trinity Lutheran was already satisfied by the
regulations and that requiring beneficiaries to receive federally
funded services in a place with religious iconography is a ``far cry''
from the playground resurfacing in Trinity Lutheran.
Other commenters supported the Agencies' changes. One commenter
stated that the changes helpfully clarify that faith-based
organizations are protected against not only the removal of religious
symbols, but also their alteration or concealment. Another commenter
noted that many Americans find comfort in religious artifacts and
suggested that the presence of such symbols could be part of a holistic
approach to meeting the social service needs of vulnerable populations.
Response: Although the Agencies wish for each beneficiary to be
comfortable receiving social services, they disagree that the proposed
changes to these provisions would appreciably add to any beneficiary
discomfort or cause government endorsement of religion, to the extent
endorsement remains a measure of a government establishment of
religion. Instead, this final rule merely fleshes out the existing
regulatory principle that faith-based organizations are permitted to
use their facilities to provide Agency-funded social services even
though their facilities display religious art, icons, scriptures, or
other religious symbols. The Agencies generally do not limit other
displays by other organizations receiving Federal funding.
The Agencies' regulations already allowed displays of religious
symbols, consistent with existing Federal statutes and regulations. In
accord with Executive Order 13279, and Federal statutes such as 42
U.S.C. 290kk-1(d)(2)(B), all Agencies already had regulations that
expressly permitted faith-based organizations to provide services
without removing religious symbols. Some Agencies also expressly
permitted the display of religious symbols without their alteration or
concealment. None of the Agencies' regulations required the removal,
alteration, or concealment of religious symbols. As noted in the 2016
final rule, such a requirement would be inconsistent with ``the general
practice of Agencies that do not otherwise limit art or symbols that
recipients of Federal financial assistance may display in the
structures where agency-funded activities are conducted.'' 81 FR at
19372. The Agencies' proposed changes thus helpfully clarify the rights
of faith-based organizations without imposing meaningfully greater
burdens on beneficiaries and bring the Agencies' treatment of faith-
based organizations' displays into line with their treatment of secular
organizations' displays.
The Agencies disagree with the commenters who said that this change
would be improper because religious symbols might make some
beneficiaries feel uncomfortable. As a factual matter, in the Agencies'
experience, discomfort with religious symbols has not been a
significant issue for beneficiaries. For example, the Agencies are not
aware of any beneficiaries that availed themselves of the alternative
provider
[[Page 82091]]
referral requirement on that basis. See Part II.C.3.c. Moreover, even
if the commenters could show that some beneficiaries would be
uncomfortable with religious symbols, the commenters do not identify
any authority supporting a constitutional or other legal right to be
free from such discomfort. Indeed, it is unclear whether any
beneficiary would even have grounds to challenge such a display based
on such offense, objection, or disagreement, no matter how `` `sharp
and acrimonious it may be.' '' Am. Legion v. Am. Humanist Ass'n, 139 S.
Ct. 2067, 2098 (2019) (Gorsuch, J., concurring in judgment) (quoting
Diamond v. Charles, 476 U.S. 54, 62 (1986)); see Valley Forge Christian
Coll. v. Ams. United for Separation of Church & State, Inc., 454 U.S.
464, 485 (1982).
Furthermore, in addition to breaking with longstanding practice,
singling out religious providers for censorship of art or symbols would
be in tension with First Amendment principles, RFRA, the binding legal
principles summarized in the Attorney General's Memorandum and
Executive Order 13559. See, e.g., E.O. 13559, 75 FR at 71320 (``Among
other things, faith-based organizations that receive Federal financial
assistance may use their facilities to provide social services
supported with Federal financial assistance, without removing or
altering religious art, icons, scriptures, or other symbols from these
facilities.''). Such targeted censoring of faith-based organizations
would risk imposing ``special disabilities'' on religious groups based
purely on their religious status and imposing a substantial burden on
such groups' religious exercise. Trinity Lutheran, 137 S. Ct. at 2019;
42 U.S.C. 2000bb-1; Attorney General's Memorandum, Principle 6, 82 FR
at 49669. As explained in Part II.C.3.a, the Supreme Court has made
clear in Espinoza that the First Amendment prohibition of
discrimination on the basis of religious character from Trinity
Lutheran is a general principle not limited to grants for playground
resurfacing.
Even if some beneficiaries might theoretically prefer not to
encounter religious art or symbols, the same issue may arise with
respect to certain non-religious art or symbols. For example, a
beneficiary may be uncomfortable receiving services in a facility
adorned with secular art or symbols that reflect values inconsistent
with his or her moral, political, or religious beliefs. A blanket ban
on all symbols that cause discomfort would be beyond the scope of the
final rules, has not been suggested by any commenter, and would have
additional First Amendment implications. Permitting the display of
religious symbols is therefore consistent with the Agencies' practices,
with the principle of freedom of speech, and with the principle of
government neutrality toward religion. Even if the Agencies' clarifying
amendments could impose some additional burdens on beneficiaries, the
Agencies would still exercise their discretion to make these changes
because they believe the burden would be slight compared to the burden
a contrary rule would impose on religious organizations.
Moreover, the Agencies have concluded that allowing religious
displays can benefit both beneficiaries and providers. As one commenter
noted (and as with non-religious symbols), many Americans find comfort
in religious artifacts and the presence of such symbols could be part
of a holistic approach to meeting the social services needs of
vulnerable populations. Others certainly might have different feelings,
but going so far as to order the removal, alteration, and concealment
of a religious group's cherished symbols may well lead to that
religious group feeling uncomfortable or unwelcome at the hands of the
Government. As the Supreme Court recently observed, eliminating
religious symbols (or requiring their alteration or concealment) may
appear ``hostile to religion'' rather than ``neutral.'' Am. Legion, 139
S. Ct. at 2084-85. There is a particular risk of the Agencies
displaying such hostility if they required such elimination,
alteration, or concealment here because they do not generally restrict
parallel secular displays, no matter how offensive to certain
beneficiaries.
The Agencies disagree that the display of religious symbols by
faith-based organizations constitutes a government endorsement of
religion in violation of the Establishment Clause. As an initial
matter, the Supreme Court has declined to apply the ``endorsement''
test in recent Establishment Clause cases, and several Justices have
questioned its vitality, including in cases challenging official
displays of religious symbols. See, e.g., Am. Legion, 139 S. Ct. at
2080-82 (plurality); id. at 2092 (Kavanaugh, J., concurring); id. at
2100-02 (Gorsuch, J., concurring); Van Orden v. Perry, 545 U.S. 677,
698-705 (Breyer, J., concurring in judgment). Instead, the Court has
interpreted the Establishment Clause ``by reference to historical
practices and understandings.'' Town of Greece v. Galloway, 572 U.S.
565, 576 (2014) (internal quotation marks omitted).\66\ The Agencies
are not aware of any history or tradition of prohibiting religious
displays by private faith-based organizations that receive Federal
funding, and no commenter pointed to any.
---------------------------------------------------------------------------
\66\ See also Am. Legion, 139 S. Ct. at 2087 (same) (plurality);
id. at 2090-91 (Breyer, J., concurring) (stating that ``I have long
maintained that there is no single formula for resolving
Establishment Clause challenges,'' and``[t]he Court appropriately
looks to history for guidance'') (internal quotation marks omitted);
id. at 2092 (Kavanaugh, J., concurring) (``Consistent with the
Court's case law, the Court today applies a history and tradition
test.''); id. at 2094 (Kagan, J., concurring in part) (``I agree
that rigid application of the Lemon test does not solve every
Establishment Clause problem[.] . . . I too look to history for
guidance.'') (alteration and internal quotation marks omitted); id.
at 2096 (Thomas, J., concurring in judgment) (``[T]he plaintiff must
demonstrate that he was actually coerced by government conduct that
shares the characteristics of an establishment as understood at the
founding.''); id. at 2101 (Gorsuch, J., concurring in judgment)
(``[W]hat matters . . . is whether the challenged practice fits
within the tradition of this country.'') (internal quotation marks
omitted).
---------------------------------------------------------------------------
To the extent that the ``endorsement'' test survives, moreover,
there is no reason to think it would require the removal, alteration,
or concealment of religious symbols in this context. Unlike in a
typical Establishment Clause case that involves a religious display on
government property, see, e.g., Cty. of Allegheny v. ACLU Greater
Pittsburgh Chapter, 492 U.S. 573, 579 (1989) (barring cr[egrave]che in
the ``most public'' part of a county courthouse), the provisions at
issue here concern the display of religious symbols by private
organizations on private property. A reasonable observer would
understand that such a display--considered alongside the displays, both
religious and secular, by all the other private organizations that help
to administer Federal social service programs--does not convey a
message of endorsement by the Federal Government. In this context,
where the Government is not sponsoring the display and the Government-
funded programs are open to a variety of religious and non-religious
participants, a ban on the display of religious symbols might even
constitute an impermissible viewpoint-based regulation of private
religious expression. Cf. Capitol Square Review & Advisory Bd. v.
Pinette, 515 U.S. 753, 759-63 (1995). The government does not endorse
religion in general, or a faith in particular, by allowing a faith-
based organization to participate equally in delivering federally
funded services and to maintain a display that reflect its religious
identity, especially when a secular organization does not need to
remove a comparable display.
Changes: None.
[[Page 82092]]
Affected Regulations: None.
2. Nonprofit Status
Existing regulations for DOJ, DOL, ED, HHS, and USAID provided
that, where eligibility for funding is limited to nonprofit
organizations, nonprofit status can be demonstrated by several means:
(1) Proof that the IRS currently recognizes the applicant as an
organization to which contributions are tax deductible under section
501(c)(3) of the Internal Revenue Code; (2) a statement from a State
taxing body or the State secretary of state certifying that the
organization is a nonprofit organization operating within the State and
that no part of its net earnings may lawfully benefit any private
shareholder or individual; (3) a certified copy of the applicants'
certificate of incorporation or similar document that clearly
establishes the nonprofit status of the applicant; or (4) any of the
foregoing methods of proof if applicable to a State or national parent
organization, together with a statement by the State or parent
organization that the applicant is a local nonprofit affiliate.
Under the proposed rules, DHS, HUD, and VA would adopt the same
four provisions. Also, DHS, DOJ, DOL, ED, HHS, HUD, and VA would add a
fifth provision stating that, if an entity has a sincerely held
religious belief that it cannot apply for a determination as tax-exempt
under section 501(c)(3), the entity may demonstrate nonprofit status by
submitting ``evidence sufficient to establish that the entity would
otherwise qualify as a nonprofit organization'' under the four
provisions. Because USAID and USDA did not propose any changes to their
existing regulations regarding determination of nonprofit status, the
discussion below does not apply to them, unless otherwise noted.
Summary of Comments: A few commenters criticized the Agencies'
proposed changes. One commenter to ED and HHS characterized the changes
as allowing faith-based organizations to ``self-certify their nonprofit
status,'' whereas in the commenter's view, a ``formal determination of
tax-exempt status'' promotes greater accountability by ensuring the
record-keeping and transparency needed to monitor grant compliance. The
same commenter suggested that alternative pathways for demonstrating
nonprofit status are unnecessary because, in the commenter's view,
requiring 501(c)(3) status imposes no substantial burden on religion.
The commenter cited for support Locke v. Davey, 540 U.S. 712, which the
commenter characterized as holding that denying government funding for
``religious activity'' does not infringe religious freedom. Finally,
this commenter asserted that there is ``no evidence that the current
requirement is burdensome'' to faith-based organizations that receive
Federal financial assistance to provide social services.
Another commenter asserted in cursory fashion that the proposed
accommodation ``means that anything goes for a religious
organization,'' that it constitutes ``special treatment,'' and that it
amounts to an unconstitutional ``establishment of religion.''
One commenter supported the Agencies' changes, stated that the
changes provide ``an accommodation for those religious nonprofits whose
sincerely held religious beliefs impede or bar their application'' for
501(c)(3) status, and stated that this clarification is appropriate and
commendable.
Response: The Agencies disagree that the addition of language
providing alternative means for demonstrating nonprofit status would
reduce transparency and accountability. The Agencies' grants and
programs have appropriate record-keeping requirements and mechanisms
for monitoring compliance that apply regardless of 501(c)(3) status.
Moreover, in the Agencies' experience, formal determination of tax-
exempt status is of little relevance in facilitating grant transparency
and accountability. Indeed, many faith-based 501(c)(3) organizations
are exempt from those record keeping requirements. For example, the
Agencies issue grants to 501(c)(3) entities that are exempt from filing
Form 990s, such as churches, integrated auxiliaries, and certain
schools affiliated with churches. 26 CFR 1.6033-2(g). Five of the
Agencies already allowed three of these alternatives for demonstrating
nonprofit status--(2), (3), and (4) listed above--without any evidence
of transparency or accountability issues. And the new fifth alternative
requires evidence sufficient to establish one of the other
alternatives, so it should not lower the bar. Additionally, the
organizations that meet these alternatives may be subject to State or
other oversight that imposes further transparency and accountability.
The Agencies also disagree with the comment regarding entities
self-certifying their nonprofit status. This comment appears to
misunderstand the proposed changes. None of the Agencies proposes to
allow faith-based organizations to ``self-certify'' their nonprofit
status. Rather, an organization can submit formal documentation of its
own State nonprofit status, its incorporation, or its parent
organization's national or State nonprofit status. Again, five of the
Agencies already allowed those methods of proof. Additionally, for
seven Agencies, this final rule adds an option permitting a faith-based
organization with a sincere religious belief that prevents it from
obtaining tax-exempt status under section 501(c)(3) of the Internal
Revenue Code to submit other documentary evidence that ``is sufficient
to establish'' that the organization operates as a nonprofit. This is
not a mere self-certification.
The Agencies also disagree with the commenter's suggestion that the
alternative pathways are unnecessary because obtaining 501(c)(3) status
does not impose a substantial burden on religion. As a preliminary
matter, the Agencies exercise their discretion to allow alternative
ways to show that an organization is a nonprofit because that is the
appropriate policy decision for the reasons discussed in the NPRMs and
throughout this section. They do not need to show a substantial burden
to do so.
The commenter's reliance on Locke v. Davey is misplaced. Locke held
only that, in the unique context of the historically sensitive issue of
government funding for the training of clergy, the Free Exercise Clause
did not compel a State to include funding for theology degrees in a
scholarship aid program. See 540 U.S. at 725. The Court did not hold
that denying funding to religious organizations can never infringe
religious liberty or that funding of religious organizations can be
justified only to relieve them of a substantial burden. In fact, the
Court held expressly that the Government has discretion to fund
religious organizations in many programs, including in the unique
context of training for clergy, where funding is not constitutionally
required. See id. at 718-19; see also Part II.C.3.a (discussing Locke).
Furthermore, the Agencies agree with the commenter that said faith-
based organizations may have sincere religious beliefs that prevent
them from meeting certain prerequisites for 501(c)(3) status. For these
organizations, requiring a formal determination of 501(c)(3) status
could impose a meaningful burden. Accordingly, in the Agencies'
judgment, adding an alternative for such organizations, while requiring
evidence sufficient to meet one of the other alternatives, will promote
consistency with the principles of religious liberty set forth in RFRA,
Supreme Court precedent, and the Attorney General's Memorandum.
[[Page 82093]]
As one commenter pointed out, existing regulations for several
Agencies, including ED and HHS, already provided alternatives to
501(c)(3) registration for demonstrating nonprofit status. The Agencies
agree that those provisions are helpful, so DHS, HUD, and VA are
adopting them. DHS, HUD, VA, DOJ, DOL, ED, and HHS are also adding the
alternative mechanism for entities with specific sincerely held
religious objections to ensure that such objections do not prevent them
from otherwise demonstrating nonprofit status. Additionally, in the
Agencies' experience, faith-based organizations may be reluctant to
apply for grants when it is unclear whether they are eligible or when
there is a risk that they could be subject to litigation if awarded the
grant. The Agencies believe that the additional provision may be
helpful in eliminating any potential doubt that alternative methods of
proof are available when eligibility to apply for a grant is limited to
(or includes) nonprofit organizations, including organizations whose
objection to 501(c)(3) registration is grounded in sincere religious
belief. This additional provision also clarifies that evidence that
would otherwise be used to demonstrate nonprofit status as part of the
501(c)(3) registration process may be sufficient to demonstrate
nonprofit status for purposes of the grant application.
Finally, the Agencies disagree with the assertion that the proposed
changes constitute special treatment for religious organizations or
violate the Establishment Clause. Under the final rule, any
organization with a sincerely held religious belief that it cannot
apply for 501(c)(3) status, faith-based or secular, may demonstrate
nonprofit status by methods other than providing proof of 501(c)(3)
status. The changes are consistent with most Agencies' existing
regulations, and simply help to ensure equal treatment of faith-based
organizations with sincere religious beliefs that may warrant an
accommodation. Moreover, the final subsection does not relieve faith-
based organizations of the obligation to demonstrate nonprofit status;
rather, it clarifies the type of evidence required to establish such
status. No commenter has even attempted to explain how this modest
accommodation could amount to an unconstitutional establishment of
religion, and the Agencies do not believe there is any plausible
doctrinal basis for such a claim.
Changes: None.
Affected Regulations: None.
3. Notice to Faith-Based Organizations
Existing regulations did not require specific notice to faith-based
organizations regarding their eligibility to participate on equal terms
in the programs governed by these regulations and regarding their
obligations to beneficiaries.
All of the Agencies proposed to require such notice. In its notices
or announcements of award opportunities, USAID proposed to require
notice indicating that faith-based organizations are eligible on the
same basis as any other organization, subject to the protections and
requirements of Federal law. In their notices or announcements of award
opportunities, the other eight Agencies proposed to require notice
``substantially similar'' to the language in a relevant Appendix A,
which explained that: (1) Faith-based organizations may apply on the
same basis as any other organization as set forth in each Agency's
section of these regulations and in RFRA; (2) the Agency will not
discriminate in selection on the basis of religious exercise or
affiliation; (3) a faith-based organization that participates in the
program will retain its independence from the Government and may
continue to carry out its mission consistent with the religious freedom
protections in Federal laws, including the Free Speech Clause, the Free
Exercise Clause, RFRA, and other statutes; (4) religious accommodations
``may also be sought'' under many of these religious freedom protection
laws; (5) faith-based organizations may not use direct Federal
financial assistance to support or engage in any explicitly religious
activities, except when consistent with the Establishment Clause and
any other applicable requirements; and (6) a faith-based organization
may not, in providing services funded by the Agencies, discriminate
against a program beneficiary or prospective beneficiary on the basis
of religion, a religious belief, a refusal to hold a religious belief,
or a refusal to attend or participate in a religious practice. In their
notices of award or contract, seven Agencies--not including USAID and
HUD--proposed notices ``substantially similar'' to the language in an
Appendix B, which was the same as items 3 through 6 from Appendix A.
Summary of Comments: The Agencies incorporate the comments
addressed in Parts II.C.1 and II.E that are relevant to the importance
of notice to faith-based organizations compared to notice to
beneficiaries.
Some commenters said that the proposed notice for faith-based
organizations embeds equality in these programs and clarifies that the
Agencies will not discriminate against faith-based organizations.
Multiple commenters recognized that notice to faith-based organizations
of the prohibition against discrimination based on religious character,
exercise, and affiliation is consistent with the First Amendment rights
discussed in Part II.F.
Some commenters, including 34 Members of Congress, generally
opposed providing special notices for faith-based organizations that
invite accommodation requests, including from generally applicable
civil rights laws. Most of these commenters argued that this notice of
the availability of accommodations will encourage or pave the way for
providers to refuse to provide key services and to discriminate in
taxpayer-funded programs, as discussed in Part II.E. One of these
commenters disagreed that this final rule adds clarity, arguing that
this notice's reference to accommodations eliminates clear lines by
suggesting that faith-based providers can be excused from rules that
apply to other providers. Commenters also argued that such notice of
the availability of accommodations puts the interests of faith-based
organizations over the needs of people who depend on the services.
A commenter argued that the Agencies acknowledged the limits on the
duty to accommodate but failed to reflect those limits in their
proposed new notices.
One commenter argued that the proposal to give notice that faith-
based organizations retain independence from the Government is
inconsistent with the Religion Clauses and Article IV, Section 4 of the
U.S. Constitution because, in this commenter's view, faith-based
organizations should be treated differently than, and essentially worse
than, secular organizations. This commenter argued that the First
Amendment mandates that `` `Faith Based' entities are not the same as
secular entities and are not to be treated the same for fear that they
would create the problems they have created throughout history.'' This
commenter reasoned that the First Amendment's references to religion
implied that equal treatment was not intended.
This commenter also argued, regarding notice of faith-based
organizations retaining their independence consistent with the Free
Speech Clause, that Free Speech is not an absolute right. This
commenter added that the Government and ``government surrogates''
cannot minister to recipients, so faith-based organizations' Free
Speech rights should
[[Page 82094]]
not include ministering to beneficiaries when performing a government
function.
Response: The Agencies incorporate the discussion of the notice and
accommodation requirements in Parts II.C.1 and II.E above.
Additionally, the Agencies agree with comments that this notice helps
effectuate the religious liberty protections for beneficiaries in these
programs and clarifies that the Agencies and their intermediaries will
not discriminate against faith-based organizations based on religious
character, affiliation, or exercise. The nondiscrimination provision is
consistent with the First Amendment and RFRA, as discussed in Part
II.F.
The Agencies disagree that this notice to faith-based organizations
will invite any improper denials of service or discrimination. As
discussed in Parts II.C, II.E, and II.F, the Free Exercise Clause and
other Federal laws, including RFRA, required or permitted certain
accommodations under the 2016 final rule. The notice provided for in
this final rule does not change that substantive law regarding
accommodations. This notice merely ensures that faith-based
organizations, the Agencies, intermediaries, and advocacy organizations
are aware of that governing Federal law regarding accommodations. To
the extent that the Agencies accommodate a faith-based organization
with regard to a generally applicable requirement, including allowing
the faith-based organization to engage in conduct that might otherwise
be considered discrimination or denial of service, that accommodation
would be governed by the Free Exercise Clause and other Federal laws,
including RFRA, not by this notice requirement. The comments that
disagree with this notice appear to disagree with the underlying
Federal law regarding accommodations. The Agencies exercise their
discretion to notify faith-based providers (and others, including the
Agencies' intermediaries) of that governing Federal law regarding
accommodations to protect those rights, ensure that the Agencies and
their intermediaries recognize and protect those rights, minimize
erroneous lawsuits challenging whether those rights apply in these
programs, and eliminate the confusion created by the absence of any
such reference in the 2016 final rule.
The Agencies also disagree with the commenter that claimed these
notices do not reference the limitations on accommodations. In fact,
all of the prescribed notice texts expressly refer to the
constitutional and statutory bases for these accommodations, each of
which contain their own limits.
Additionally, the Agencies believe a commenter was mistaken to
argue, in essence, that the Religion Clauses and Article IV, Section 4
of the U.S. Constitution require faith-based organizations to be
treated worse than secular entities and thus that providing notice of
rights and obligations to faith-based organizations would be
unconstitutional. To the contrary, as discussed throughout this
preamble, the Establishment Clause permits, and the Free Exercise
Clause and RFRA sometimes require, and other times permit, the
Government to provide special accommodations for religious exercise.
Moreover, Article IV, Section 4 of the U.S. Constitution guarantees to
every State a ``Republican Form of Government,'' protection against
``Invasion,'' and, on application, protection against ``domestic
Violence.'' The Agencies do not see how this constitutional provision
is implicated by providing notices to faith-based organizations.
The Agencies agree that the Free Speech Clause is not absolute and
that there are circumstances in which funding explicitly religious
activities is prohibited as part of direct Federal financial assistance
programs and activities. But this final rule requires notice of such
limitations on speech, including limitations on explicitly religious
activities, in addition to notice that faith-based organizations retain
their free speech rights. Also, the notice of the right to expression
merely clarifies that such existing rights are retained, not expanded,
as discussed in Part II.G.5 below. The Agencies have determined in
their discretion that such a comprehensive notice appropriately
balances the rights of beneficiaries and faith-based organizations.
In addition to all of the other reasons outlined in this section
and in Parts II.C, II.E, and II.F, this additional notice to faith-
based organizations will maximize the services available to
beneficiaries. For example, this notice will ensure that faith-based
organizations are aware that they can apply to participate in these
programs on neutral terms and should not face lawsuits challenging such
awards. At the same time, these notices make clear to faith-based
organizations--when applying for and accepting an award--that they
cannot discriminate against beneficiaries based on religion and that
they cannot incorporate explicitly religious activities into the funded
programs, unless consistent with the Establishment Clause. Moreover,
these notices will be provided by the Agencies or intermediaries, as
part of notices that were already being sent and that already describe
other eligibility and program requirements. And, these notices are
appropriate to clarify the law in light of the confusion--including
confusion by intermediaries and pass-through entities--created by the
2016 final rule. Indeed, the 2016 final rule did not provide for
accommodations for faith-based organizations, even though the First
Amendment and RFRA permitted certain accommodations when that rule
applied. The Agencies have determined in their discretion that this is
the appropriate means to protect faith-based organizations and
beneficiaries, as well as to maximize the availability of appropriate
federally funded services.
Finally, ED, DHS, USDA, HUD, DOJ, DOL, VA, and HHS are adding
clarifying language to these notices regarding conscience protections.
The notices refer to the listed ``protections in Federal law'' as
``religious freedom protections.'' To ensure there is no confusion
regarding the listed conscience clauses--such as the Coats-Snowe
Amendment (42 U.S.C. 238n), the Weldon Amendment, and 42 U.S.C. 18113,
some of which might not be viewed as religious freedom protections
only--the Agencies are adding clarifying language to indicate that
these are both ``religious freedom and conscience protections in
Federal law.'' This does not change the substance or scope of the
notices. This does not apply to USAID, which is not providing an
Appendix with language for its notice.
Changes: ED, DHS, USDA, HUD, DOJ, DOL, VA, and HHS include ``and
conscience'' protections in their notices. See also Part II.F.1
(discussing these Agencies' addition of ``religious character'').
Affected Regulations: 34 CFR part 75 Appendices A & B (ED); 6 CFR
part 19 Appendices A & B (DHS); 7 CFR part 16 Appendices A & B (USDA);
24 CFR part 5 Appendix A (HUD); 28 CFR part 38 Appendices A & B (DOJ);
29 CFR part 2 Appendices A & B (DOL); 38 CFR part 50 Appendices A & B
(VA); 45 CFR part 87 Appendices A & B (HHS). See also Part II.F.1
above.
4. Same Requirements for Faith-Based and Secular Organizations
Existing regulations for DOJ, DOL, HHS, and USAID provided that no
grant document, agreement, covenant, memorandum of understanding,
policy, or regulation that these Agencies or their intermediaries used
to administer financial assistance from these Agencies shall require
only faith-based organizations to provide certain
[[Page 82095]]
assurances that they would not use funding for explicitly religious
activities. DHS, ED, HUD, USDA, and VA did not have specific parallel
requirements.
All of the Agencies proposed to modify their existing provision or
to add language to provide that none of the documents listed above
shall require faith-based organizations to provide any assurances or
notices where such assurances or notices are not required of non-
religious organizations.
Summary of Comments: Some commenters, including a State attorney
general, agreed with the Agencies' addition of the provision barring
any required additional assurances from faith-based organizations that
are not required from secular organizations. These commenters explained
that this provision is consistent with the Religion Clauses, including
under Trinity Lutheran; ensures faith-based organizations can receive
Federal funding on the same footing as other organizations; and
eliminates confusion.
One commenter argued to multiple Agencies, however, that the
provision barring additional assurances or notices from faith-based
organizations that are not required from secular organizations violates
the First Amendment's Free Exercise and Establishment Clauses, as well
as Article IV, Section 4 of the U.S. Constitution.
Another commenter to USAID argued that prohibiting such unique
assurances, in combination with the changes discussed in Part II.F,
threatens the rights of marginalized populations.
Another commenter to HUD argued that additional assurances may be
necessary to ensure that the faith-based provider can offer the
services required under the program. This commenter provided the
hypothetical example of an organization affiliated with a religion
that, according to the commenter, has a history of ``anti-LGBTQ''
sentiment and action being required to provide additional assurances of
nondiscrimination based on sexual orientation or that its physical
space would be welcoming to LGBTQ individuals.
Response: The Agencies agree that this modified or added
prohibition is consistent with the Religion Clauses, including under
Trinity Lutheran; ensures faith-based organizations can receive Federal
funding on the same footing as other organizations; and eliminates
confusion. The Agencies do not see any reason to preserve the language
that limited this prohibition to explicitly religious activities when
all of the other substantive provisions apply equally to faith-based
and non-faith-based providers within each program. If notice or
assurance is warranted to ensure services are provided under a program,
such notice or assurance should be equally warranted for all providers
that are subject to the underlying requirement, as explained in detail
in Part II.C. There is no indication that barring the requirement of
such unique assurances from faith-based organizations would threaten
the rights of any beneficiaries.
This conclusion is bolstered by the commenter's hypothetical
example of a specific faith-based organization with a history of what
the commenter called ``anti-LGBTQ'' sentiment. The Agencies could
require any participant with a history of anti-beneficiary sentiment to
provide additional assurances. This final rule would permit such a
requirement, if applied neutrally to all providers without engaging in
viewpoint discrimination. But there is no reason to require such
assurances only from religious organizations without requiring the same
from similarly situated secular organizations. This change in the final
rule provides merely that such assurance and notice requirements be
applied neutrally, which ensures that these requirements are imposed to
protect beneficiaries, not to discriminate against or stigmatize faith-
based organizations. Similarly, there is no indication that there would
be any harm from combining this provision with the provisions
prohibiting discrimination against faith-based organizations that were
discussed in II.F.
Finally, as discussed in Part II.G.3, the Agencies disagree with
commenters who contended that equal treatment of faith-based and non-
faith-based organizations is inconsistent with the Religion Clauses and
Article IV, Section 4 of the U.S. Constitution.
Changes: None.
Affected Regulations: None.
5. Religious Autonomy and Expression
ED's existing regulations provided that a faith-based organization
participating in its programs ``may retain its independence, autonomy,
right of expression, religious character, and authority over its
governance.'' 2 CFR 3474.15(e)(1); 34 CFR 75.52(d)(1), 76.52(d)(1).
Existing regulations applicable to the other Agencies provided that a
religious organization participating in a Federal financial assistance
program or activity will retain its independence, and ``may continue to
carry out its mission, including the definition, development, practice,
and expression of its religious beliefs.'' Additionally, the existing
regulations for DOJ, DOL, and HHS provided that a faith-based
organization retains such ``independence from Federal, State, and local
governments.''
DHS, DOJ, DOL, HHS, HUD, USDA, and VA proposed to amend the rights
retained by a participant in such programs to be consistent with ED,
such that a faith-based organization retains its ``autonomy; right of
expression; religious character;'' and ``independence,'' and may
continue to carry out its mission, including the expression of its
religious beliefs. Additionally, DHS, USDA, and VA proposed to add
language clarifying that a faith-based organization retains such
independence ``from Federal, State, and local governments,'' which DOJ,
DOL, and HHS proposed to retain. USAID proposed to add language that a
faith-based organization retains its ``autonomy, religious character,
and independence'' and may continue to carry out its mission
``consistent with religious freedom protections in Federal law,''
including expression of its religious beliefs.
Summary of Comments: Several commenters supported these changes to
clarify that faith-based organizations retain these rights, including
multiple commenters who opposed other provisions of this final rule.
One commenter specified that this clarification describes the First
Amendment's broad protections for the freedom to exercise religion, for
the sphere of religious autonomy in which government cannot interfere,
and from government entanglement with religion.
Many of these commenters stated that this clarification was
important to ensure faith-based providers can participate in these
programs without fear of having to abandon their autonomy and rights
that are protected by other Federal laws and that should not be checked
at the door when interacting with the Government. One commenter argued
that faith-based organizations' autonomy and expression are interests
of the highest order. Some commenters argued that this is one of the
changes in this final rule that will help restore an environment of
religious freedom across the country.
Some commenters opposed this clarification for varying reasons.
Some commenters argued generally that this clarification was
problematic and would endanger beneficiaries' rights. One commenter
recognized that faith-based organizations should be able to retain
their autonomy, right of expression, religious character, and
independence but argued that, if they accepted government contracts or
financing, those organizations should not be able
[[Page 82096]]
to force their opinions or choices on beneficiaries. One commenter
expressed concern that Federal funding suggests government support of
the funding recipient's message.
One commenter argued that the wording being added by DHS, USDA, and
VA that faith-based organizations retain their ``independence from
Federal, State, and local governments'' is irrational because everyone
is bound by the Governments' laws, with the commenter listing specific
criminal laws of murder, fraud, trespass, and theft.
One commenter argued that adding the language that a faith-based
organization may carry out its mission, including the ``definition,
development, practice, and expression of its religious beliefs'' would
expand the ability of federally funded organizations to attack the
rights of their beneficiaries. This commenter provided the example of
an organization receiving HIV prevention funding claiming that anti-
LGBTQ activities were an expression of religious beliefs, which could
undermine the organization's ability to become a trusted service
provider within the community.
One commenter to HHS cited survey respondents that claimed negative
experiences with health professionals who expressed religiously
grounded bias toward LGBT patients, which was discussed in detail in
Part II.C.2.b.
Response: The Agencies agree with the comments that this added
autonomy language clarifies the rights retained by faith-based
organizations. This language expressly does not create any new rights,
it merely clarifies that these pre-existing religious liberties are not
waived by participation in these Federal financial assistance programs
or activities. This approach is appropriate because these are existing
core religious liberties that faith-based organizations should not have
to, and should not be asked to, waive in order to participate in
Federal financial assistance programs or activities. The Agencies agree
that this clarification will help restore an environment of religious
freedom.
The Agencies disagree that this added autonomy language will be
problematic or endanger beneficiaries. Faith-based organizations will
still have to comply with the other requirements in this final rule,
including prohibitions against explicitly religious activities, which
expressly include proselytizing. Also, as discussed throughout this
final rule, the Agencies are not supporting the message of any
organization that participates in these Federal financial assistance
programs or activities. If they were, the Agencies would also need to
regulate the autonomy and expression of secular organizations.
The addition by DHS, USDA, and VA that the retained independence is
``from Federal, State and local governments,'' is rational. This
language does not create any new independence. It merely clarifies that
faith-based organizations' independence is not sacrificed merely by
participating in a Federal financial assistance program or activities.
Civil and criminal laws still apply to the extent they did before.
Additionally, this provision makes the language used by DHS, USDA, and
VA consistent with the language used by DOJ, DOL, and HHS. 81 FR at
19419 (DOJ, 28 CFR 38.5(b)); id. at 19422 (DOL, 29 CFR 2.32(b)); id. at
19427 (HHS, 45 CFR 87.3(c)). And no commenter pointed to any issue
created by this language in the regulations of DOJ, DOL, or HHS.
The prior rule contained the language that carrying out a faith-
based organization's mission includes the ``definition, development,
practice, and expression of its religious beliefs.'' 81 FR at 19406
(ED, 2 CFR 3474.15(e)(2)(ii)); id. at 19412 (DHS, 6 CFR 19.8(a)); id.
at 19415 (USAID, 22 CFR 205.1(c)); id. at 19416 (HUD, 24 CFR
5.109(d)(1)); id. at 19419 (DOJ, 28 CFR 38.2(a), 38.5(b)); id. at 19422
(DOL, 29 CFR 2.32(b)); id. at 19424 (VA, 38 CFR 50.1(a)); see also id.
at 19413 (USDA, 7 CFR 16.3(b)); id. at 19427 (HHS, 45 CFR 87.3(c)).
Thus, contrary to the understanding of the commenter that opposed the
addition of this language, the Agencies are not adding this language in
this final rule. The Agencies are merely retaining it from the 2016
final rule. Moreover, this language is an appropriate description of
what it means for a faith-based organization to carry out its mission.
Also, contrary to this commenter's claim, this final rule is not
the appropriate mechanism for ensuring that each provider becomes a
trusted service provider within the community. Any such concern should
also apply equally to all providers. Any organization's expression
could alienate, or cause negative experiences for, beneficiaries by
taking a position on any controversial issue.
Additionally, this analysis is not affected by the study that a
commenter cited regarding negative experiences. The Agencies
incorporate the discussion of that study from Part II.C.2.b, including
that it did not show harms specific to faith-based organizations
receiving Federal financial assistance. And the added language
discussed in this section does not affect the scope of permissible
religious expression, so any negative experiences will be attributable
to the existing protections of such expression.
Changes: None.
Affected Regulations: None.
H. Employment and Board Membership
Existing regulations for eight of the Agencies provided that, by
receiving Federal financial assistance, a religious organization did
not forfeit its protection under section 702 of the Civil Rights Act of
1964 (``section 702 exemption''), which allowed it to hire persons ``of
a particular religion'' to carry out work connected with the
organization. VA was the only Agency that did not have any language
specifically addressing the section 702 exemption in its existing
regulation. VA's regulation simply stated that faith-based
organizations participating in a social service program supported with
Federal financial assistance retained their independence and could
continue to carry out their missions. 38 CFR 50.1(a).
VA proposed to join the other Agencies by adding explicit language
stating that the section 702 exemption continues to apply when a
religious organization receives Federal financial assistance. ED, HHS,
HUD, DOL, USAID, and VA proposed adding language to clarify that
allowing the hiring of persons on the basis that they are ``of a
particular religion'' under section 702 includes allowing hiring of
persons on the basis of their acceptance of or adherence to particular
religious tenets.
Similarly, existing regulations for DHS, HUD, DOJ, and other
Agencies provided that a religious organization receiving Federal
funding retained its right to select its board members ``on a religious
basis.'' See, e.g., 28 CFR 38.5(b) (DOJ). DHS, HUD, and DOJ proposed
clarifying that choosing board members of the organization based on
religion allowed selecting members based on their acceptance of or
adherence to particular religious tenets.
1. Preserving the Section 702 Exemption
Summary of Comments: Many comments opposed allowing employers that
receive Federal funding to invoke the section 702 exemption at all.
Some stated that allowing an organization receiving Federal funding to
claim the section 702 exemption violates the Constitution's
Establishment Clause. Others expressed concern that this provision
disadvantages religious minorities and the nonreligious. Some
commenters expressed concern that this provision would lead to a
decrease in available jobs and would harm the economy and called for
this economic
[[Page 82097]]
effect to be considered in the cost-benefit analysis of the rules.
Many other commenters supported VA's proposed addition and the
other Agencies' existing rules that specified that the section 702
exemption is preserved when religious organizations accept Federal
funding. They stated that these provisions help preserve the autonomy
and identities of religious organizations. Some commenters stressed
that this is particularly important for minority religious
organizations seeking to preserve their identities, in light of the
fact that the broader labor pool is overwhelmingly not of the same
faith as the minority religious organizations.
Response: The Agencies disagree that the Establishment Clause
prohibits religious organizations from claiming the section 702
exemption when providing federally funded services. That argument has
been rejected expressly. See, e.g., Lown v. Salvation Army, Inc., 393
F. Supp. 2d 223, 249 (S.D.N.Y. 2005) (``[T]he notion that the
Constitution would compel a religious organization contracting with the
state to secularize its ranks is untenable in light of the Supreme
Court's recognition that the government may contract with religious
organizations for the provision of social services.'' (citing Bowen v.
Kendrick, 487 U.S. 589, 609 (1988))). Moreover, to force faith-based
charities to forgo their statutory right under Title VII to hire
coreligionists because they accept Federal funding for part of their
operations would effectively exclude many religious organizations from
providing federally supported services. This would undermine the
purpose of these rules to allow religious organizations to participate
on an equal footing with nonreligious organizations in the provision of
needed social services. It also might violate RFRA to deny certain
recipients the ability to claim the exemption as a condition of
receiving Federal funds, as explained in the World Vision opinion.
The section 702 exemption is critical to preserve faith-based
organizations' religious autonomy and identities, and the comments
showed that this is particularly true for minority religions and
denominations. Section 702 is a long-standing statutory exemption, so
any impact on employees or potential employees was caused by that
statute, not by regulations making clear that this statutory right is
preserved. The Agencies thus agree with those commenters who said that
it is important to preserve the section 702 exemption that Congress
provided to religious organizations, whether or not they participate in
the provision of federally funded services.
The Agencies disagree with the comments that said this provision
would harm the economy by reducing the number of jobs. At most, this
provision presents a question of the distribution of jobs and who will
provide federally funded services. This provision would not reduce the
net number of jobs or the amount of federally funded services. The
reduction of barriers to faith-based organizations participating in
providing federally funded services may in fact increase overall the
national capacity for provision of services and thus the total number
of jobs. See Part II.K.
Changes: None.
Affected Regulations: None.
2. Acceptance of or Adherence to Religious Tenets
a. Employment \67\
---------------------------------------------------------------------------
\67\ The discussion in Part III.H.2.a is solely on behalf of the
six Agencies--ED, HHS, HUD, DOL, USAID, and VA--that proposed to
explicate the section 702 exemption in this way.
---------------------------------------------------------------------------
Summary of Comments: Many commenters opposed the proposals of six
Agencies to specify that, for purposes of section 702, hiring
``individuals of a particular religion'' allows for requiring
``acceptance of or adherence to the religious tenets of the
organization.'' Many expressed fear that this change could lead to
discrimination based on race, sex (including pregnancy), sexual
orientation, or transgender status. Some said it conflicted with the
Equal Employment Opportunity Commission (``EEOC'') Compliance Manual.
Some commenters inferred from the contrast between the Americans with
Disabilities Act, which specifies that employees may be required to
``conform to the religious tenets'' of a religious organization, 42
U.S.C. 12113(d)(2), and section 702, which does not have such express
language, that Title VII was not intended to permit religious employers
to discriminate on the basis of adherence to their religious tenets.
Other commenters supported this change, saying it would make clear
that religious organizations have the ability to preserve their
identities and autonomy. A State attorney general added that this
change would ensure that the people who carry out a faith-based
organization's programs (employees) will share the organization's
faith.
Response: The ordinary meaning of the phrase ``of a particular
religion'' in the section 702 exemption encompasses the language that
these six Agencies proposed, ``acceptance of or adherence to religious
tenets.'' Religion as ordinarily understood is more than a label people
use to self-identify or which others may use to identify them or their
backgrounds. It encompasses profound beliefs about the nature of all
things and about how one should live based on those beliefs. See, e.g.,
EEOC v. Abercrombie & Fitch Stores, Inc., 135 S. Ct. 2028, 2033 (2015)
(``Congress defined `religion,' for Title VII's purposes, as
`includ[ing] all aspects of religious observance and practice, as well
as belief.''' (quoting 42 U.S.C. 2000e(j)); Burwell v. Hobby Lobby
Stores, Inc., 573 U.S. 682, 710 (2014) (``exercise of religion involves
not only belief and profession but the performance of (or abstention
from) physical acts that are engaged in for religious reasons''
(internal quotations omitted)); Widmar v. Vincent, 454 U.S. 263, 272
n.11 (1981) (``many and various beliefs meet the constitutional
definition of religion'' (internal quotation omitted)). Adherence to or
acceptance of a set of religious beliefs is encompassed within the
phrase ``of a particular religion'' and is thus a natural application
of the statutory term.
Accordingly, courts have consistently interpreted ``of a particular
religion'' in Title VII to encompass adherence to or acceptance of
particular religious beliefs. See, e.g., Hall v. Baptist Mem'l Health
Care Corp., 215 F.3d 618, 624 (6th Cir. 2000) (``The decision to employ
individuals `of a particular religion' . . . has been interpreted to
include the decision to terminate an employee whose conduct or
religious beliefs are inconsistent with those of its employer.'');
Little v. Wuerl, 929 F.2d 944, 951 (3d Cir. 1991) (upholding
termination of employee for violations of ``Cardinal's Clause,'' which
included ``entry by a teacher into a marriage which is not recognized
by the Catholic Church''); Maguire v. Marquette Univ., 627 F. Supp.
1499, 1503 (E.D. Wis. 1986), aff'd in part and vacated in part, 814
F.2d 1213 (7th Cir. 1987) (professor who was Catholic but was fired for
views on abortion barred by section 702 exemption from bringing
religious discrimination claim because ``[s]uch an inquiry would
require the Court to immerse itself not only in the procedures and
hiring practices of the theology department of a Catholic University
but, further, into definitions of what it is to be a Catholic''). The
Agencies' determination that ``of a particular religion'' encompasses
adherence to or acceptance of a set of religious beliefs is, thus,
supported by
[[Page 82098]]
the case law in addition to the ordinary meaning of the words.
The Agencies agree with commenters that this change makes clear
that faith-based organizations can preserve their autonomy and
identities when participating in federally funded programs. Religious
organizations function through their employees, and the purpose of the
1972 revision of the section 702 exemption was to respect the
organizations' religious autonomy and identities with regard to all
employees. Indeed, when upholding that 1972 amendment, the Supreme
Court expressly referenced the impact of ``religious tenets'' on faith-
based organizations' ``religious mission.'' Amos, 483 U.S. at 336.
Faith-based organizations' religious autonomy and identities would be
diminished substantially if those organizations could not ensure that
their staffs accepted and adhered to their religious tenets. The
Agencies thus agree with the State attorney general's comment that this
change ensures that the people who carry out programs (employees) will
share the organization's faith.
The Agencies disagree with comments that said this provision
permits discrimination on grounds other than religion, such as race,
sex, or sexual orientation. Existing protections for non-religious
classes remain in force. For example, where a tenet of a religious
organization forbids engaging in sexual conduct outside of marriage,
the section 702 exemption permits dismissing employees who violate this
tenet, but it would prohibit discharging only women who had engaged in
such conduct and not men. See Cline v. Catholic Diocese of Toledo, 206
F.3d 651, 658 (6th Cir. 2000) (``[C]ourts have made clear that if the
school's purported `discrimination' is based on a policy of preventing
nonmarital sexual activity which emanates from the religious and moral
precepts of the school, and if that policy is applied equally to its
male and female employees, then the school has not discriminated based
on pregnancy in violation of Title VII.''); Redhead v. Conference of
Seventh-Day Adventists, 440 F. Supp. 2d 211, 223 (E.D.N.Y. 2006)
(``[W]here religious school employers have asserted fornication as a
reason for terminating a pregnant unmarried woman, courts have held
that an employer enforcing such a policy unevenly--e.g., only against
women or only by observing or having knowledge of a woman's pregnancy--
is evidence of pretext.''). Additionally, the Agencies incorporate
their discussions from Parts II.C and II.E of the context-specific
analysis and the unique treatment of discrimination on the basis of
race.
Commenters who said that the proposed rules conflicted with the
EEOC Compliance Manual are mistaken. That manual merely says that the
section 702 exemption does not provide an exemption from prohibitions
against other forms of discrimination, such as race or sex
discrimination. That is completely consistent with the Agencies'
interpretation of the rule, as explained above.
The Agencies also disagree with drawing inferences from the fact
that Title VII does not specifically include the ``tenets'' language,
while the Americans with Disabilities Act (``ADA'') does. The section
702 exemption was enacted in 1964. The ADA was enacted in 1990 and
included a provision that tracked the Title VII ``individuals of a
particular religion'' language, 42 U.S.C. 12113(d)(1), and then added a
provision clarifying that ``[u]nder this subchapter, a religious
organization may require that all applicants and employees conform to
the religious tenets of such organization,'' id. 12113(d)(2). That
Congress added this language is no less evidence that ``individuals of
a particular religion'' meant something different 26 years earlier in
Title VII than that Congress wished to confirm its understanding of
what the phrase already meant. See, e.g., Jackson v. Birmingham Bd. of
Educ., 544 U.S. 167, 175-77 (2005) (not drawing negative inference from
fact that Title IX prohibition of sex discrimination did not include an
express prohibition of retaliation for complaint of sex discrimination,
whereas Title VII prohibition of sex discrimination did). If anything,
the clarifying language here is consistent with the ADA clarifying
language.
Changes: None.
Affected Regulations: None.
b. Board Membership \68\
---------------------------------------------------------------------------
\68\ The discussion in Part II.H.2.b is solely on behalf of the
three Agencies: DHS, DOJ, and HUD.
---------------------------------------------------------------------------
As noted, DHS, DOJ, and HUD proposed to make clear that a faith-
based organization participating in a federally funded social service
program could, as part of retaining its independence and consistent
with the prohibition on using direct Federal financial assistance to
engage in explicitly religious activities, continue to hire its board
members on the basis of acceptance of or adherence to the religious
tenets of the organization.
Summary of Comments: Some commenters raised the same concerns
discussed in Part II.H.2.a with regard to this proposal. Other
commenters supported this proposal, saying it would enable religious
organizations to preserve their identities and autonomy. A State
attorney general observed that this proposal was beneficial in ensuring
that the leaders of the organization would actually advance its
religious mission.
Response: These three Agencies determine that the added
``acceptance of or adherence to'' language is appropriate for board
members. The comments that expressed the same concerns discussed in
Part II.H.2.a miss the mark here because, while the revisions discussed
in Part II.H.2.a interpreted the Title VII exemption for faith-based
organizations ``with respect to employment of individuals of a
particular religion,'' the changes made by these three Agencies do not
purport to comment on the applicability of employment nondiscrimination
provisions. Instead, they clarify that part of faith-based
organizations' maintaining their independence when accepting Federal
assistance is that, in general and subject to nondiscrimination
requirements in program statutes for which the First Amendment and RFRA
do not provide an exception, those organizations may continue to select
their board members consistent with the organizations' religious views.
Ensuring that the board members of a religious organization heed its
``religious tenets and sense of mission,'' Amos, 483 U.S. at 336, is
particularly significant because board members shape the policy and
governance of the organization. It would be catastrophic if a faith-
based organization that was organized, for example, to put its
religious beliefs on abortion--pro or con--into effect could not
exclude board members who did not adhere to such beliefs. Appointing
leaders who would undercut the organization's essential religious
charter is tantamount to institutional apostasy. The Agencies thus
agree with the State attorney general that this clarification is
important.
Changes: None.
Affected Regulations: None.
I. Conflicts With Other Federal Laws, Programs, and Initiatives
Summary of Comments: Multiple comments claimed that the NPRMs could
create inconsistency with numerous Federal statutes. They also charged,
without any additional specifics or elaboration, that the NPRMs failed
``to consider conflicts with applicable nondiscrimination statutes,
including Titles VI and VII of the 1964 Civil Rights Act, the Americans
with
[[Page 82099]]
Disabilities Act, Section 504 of the Rehabilitation Act, Title IX of
the Education Amendments of 1972, Section 1557 of the Affordable Care
Act, the Fair Housing Act, the Violence Against Women Act, the Victims
of Crime Act, the Omnibus Crime Control and Safe Streets Act, the
Family Violence Prevention Services Act, and Executive Order 11246.''
One commenter claimed that the NPRMs were improper because they
violated the Treasury and General Government Appropriations Act of
1999, Public Law 105-277, div. A, 101(h) [title VI, 654], codified at 5
U.S.C. 601 note, by failing to include a Family Policymaking
Assessment, which, in certain circumstances, requires agencies to
assess the impact of proposed agency actions on family well-being. The
commenter critiqued the NPRMs because the Agencies failed to determine
whether a proposed regulatory action ``strengthens or erodes the
stability or safety of the family'' or ``increases or decreases
disposable income or poverty of families and children.''
A commenter stated that the NPRMs would burden the constitutional
rights to privacy that extend to sexual and reproductive choices as
enshrined in Lawrence v. Texas, 539 U.S. 558 (2003), Griswold v.
Connecticut, 381 U.S. 479 (1965), and Roe v. Wade, 410 U.S. 113 (1973).
The Agencies received comments that the NPRMs would create
inconsistencies with numerous major interagency and government-wide
initiatives, including Federal strategies to promote the health of the
nation and address homelessness, HIV, opioid abuse, and related
illnesses and deaths.
Response: The Agencies disagree with the comments that this final
rule creates inconsistency with any Federal statutes, much less the
nondiscrimination statutes identified by commenters. To the contrary,
as stated in the NPRMs, one of the purposes of this final rule is to
align the Federal regulations governing several executive branch
agencies more closely with Federal statutes (e.g., RFRA, 42 U.S.C.
2000bb et seq., and RLUIPA, 42 U.S.C. 2000cc et seq.). The Agencies
believe that, if anything, the rule makes existing regulations more
consistent with statutes such as the Family Violence Prevention
Services Act, which contains an express statutory prohibition on
discrimination on the basis of religion. 42 U.S.C. 10406(c)(2)(B)(i).
Further, the Agencies drafted the NPRMs in part to alleviate tension
with the Free Exercise Clause's prohibition on discrimination against
religious organizations by removing requirements that were not imposed
equally on secular organizations. Additionally, as discussed in Parts
II.C, II.E, and II.G, this final rule does not affect the applicability
of those other nondiscrimination laws. Therefore, the contention that
this final rule conflicts with any Federal nondiscrimination statute is
facially unconvincing. Moreover, as discussed in Part II.H, the
Agencies making each change in that section believe that this final
rule is consistent with Title VII.
Section 5(b) of Executive Order 13831 clearly requires that the
order be ``implemented consistent with applicable law.'' The Agencies
have been mindful of this requirement in drafting the NPRMs, in
evaluating the thousands of public comments received, and in drafting
this final rule. It is the position of the Agencies that this final
rule satisfies that requirement. The Agencies note that the argument
that the NPRMs violated a number of statutes consists predominantly of
merely identifying statutes by title without specific legal analysis as
to which sections have been allegedly violated, which specific
provisions of the NPRMs are involved, and what the nature of the
violations might be.
The Agencies disagree that the NPRMs violated 5 U.S.C. 601 note in
failing to conduct a Family Policymaking Assessment. Such assessments
are only required prior to an agency's implementation of ``policies and
regulations that may affect family well-being.'' 5 U.S.C. 601 note.
Under that provision, the term ``family'' is defined as ``a group of
individuals related by blood, marriage, adoption, or other legal
custody who live together as a single household'' and ``any individual
who is not a member of such group, but who is related by blood,
marriage, or adoption to a member of such group, and over half of whose
support in a calendar year is received from such group.'' Id. The
Agencies have determined that this Assessment does not apply to this
final rule because it does not focus on a ``family,'' and indeed makes
no reference to such.
The Agencies disagree that this final rule will harm privacy and
reproductive rights as protected by Roe v. Wade and other Supreme Court
jurisprudence. This final rule does not change the scope of any such
rights or jurisprudence, and commenters did not identify any such harm.
The Agencies have considered the comment that the NPRMs would
create inconsistencies with numerous major interagency and government-
wide initiatives, including Federal strategies to promote the health of
the nation and address homelessness, opioid abuse and related illnesses
and deaths, and HIV infection. The Agencies conclude that the opposite
is true. This final rule will benefit those important Federal
initiatives, in addition to others. Indeed, for each initiative, the
commenters simply speculate that there would be a conflict. But that
speculation is incorrect because, as discussed in Parts II.C, II.D,
II.E, II.F, and II.G, this final rule alleviates burdens placed on
faith-based organizations that hindered them from applying for, or
participating in, these federally funded programs. Moreover, each of
the programs discussed by this comment actually cited the benefits of
participation by faith-based organizations, so it is unclear how
expanding eligibility of faith-based organizations would be contrary to
those programs. When more organizations are eligible to compete for
Federal funds, the Agencies believe that the quality of the resulting
recipients and the services provided increases.
Regarding homelessness, the comment was made that the NPRMs would
conflict with the objectives of a 2018 report \69\ adopted by the U.S.
Interagency Council on Homelessness (``USICH''), of which most of the
Agencies are members. But the very 2018 report cited by the commenter
consistently relied on the proposition that faith-based organizations
play an important role in helping the nation alleviate homelessness.
---------------------------------------------------------------------------
\69\ United States Interagency Council on Homelessness, Home,
Together: The Federal Strategic Plan to Prevent and End Homelessness
(2018), https://www.usich.gov/resources/uploads/asset_library/Home-Together-Federal-Strategic-Plan-to-Prevent-and-End-Homelessness.pdf.
---------------------------------------------------------------------------
The commenter cited this report ten separate times, each time
omitting the references to the role of the faith community in
addressing homelessness. The report stated that social services to
address homelessness ``and other federal, state, and local programs,
must be well-coordinated among themselves, and with the business,
philanthropic, and faith communities that can supplement and enhance
them.'' Id. at 3 (emphasis added).
Objective 1.1 in that report was to ``collaboratively build lasting
systems that end homelessness.'' Id. at 11. To achieve that objective,
the report recommended that ``leaders from all levels of government and
the private, nonprofit, and faith sectors can come together to'' make
critical advancements, including building momentum behind a common
vision, understanding the scope of the problem, gathering relevant
data, and
[[Page 82100]]
implementing solutions. Id. at 11-12 (emphasis added).
Objective 1.2 was to ``increase capacity and strengthen practices
to prevent housing crises and homelessness.'' Id. at 12. To achieve
that objective, the report noted the importance of targeted assistance,
which it said ``may include a combination of financial assistance,
mediation and diversion, housing location, legal assistance, employment
services, or other supports--many of which can be provided by public,
nonprofit, faith-based, and philanthropic programs within the
community.'' Id. at 13 (emphasis added).
The report highlighted the important role that faith-based service
providers play for those in need who reject other sources of help. It
stated:
Many individuals experiencing homelessness are disengaged from--
and may be distrustful of--public and private programs, agencies,
and systems, and they may be reluctant to seek assistance. Helping
individuals to overcome these barriers often requires significant
outreach time and effort, and can take months or even years of
proactive and creative engagement to build trust. In order to
comprehensively identify and engage all people experiencing
homelessness, partnerships across multiple systems and sectors are
critically important, particularly among homelessness service
systems and health and behavioral health care providers, schools,
early childhood care providers and other educators--including higher
education institutions--child welfare agencies, TANF agencies, law
enforcement, criminal justice system stakeholders, workforce
systems, faith-based organizations, and other community-based
partners.'' Id. at 16 (emphasis added).
Objective 2.3 of the report was to ``implement coordinated entry to
standardize assessment and prioritization processes and streamline
connections to housing and services.'' Id. at 19. In support of that
objective, the report stated, ``[c]oordinated entry systems also create
the opportunity to bring non-traditional partners and resources to the
table as part of a broad and collaborative community effort that
engages other public programs and community- and faith-based
organizations in preventing and ending homelessness.'' Id. (emphasis
added).
It might also be noted that the 2015 report by the USICH \70\
placed even greater emphasis on the role of faith-based organizations
in addressing homelessness in America. The very first recommendation
made in the report was to increase leadership, collaboration, and civic
engagement. One of the key strategies the report identified for this
recommendation was to ``[i]nclude people with firsthand experience with
homelessness, businesses, nonprofits, faith-based organizations,
foundations, and volunteers.'' Id. at 33 (emphasis added). The report
also stated:
---------------------------------------------------------------------------
\70\ USICH, Opening Doors: Federal Strategic Plan to Prevent and
End Homelessness, https://www.usich.gov/resources/uploads/asset_library/USICH_OpeningDoors_Amendment2015_FINAL.pdf.
---------------------------------------------------------------------------
The homeless assistance system alone cannot address the
nation's critical shortage of affordable housing for people who live in
poverty. With 7.7 million low-income households experiencing ``worst
case housing needs,'' it is inevitable that many of these households
will experience housing crises, and will turn to family, friends,
faith-based and community organizations, and government programs for
assistance. Id. at 30 (emphasis added).
Throughout the nation, collaborations involving VA Medical
Centers, public housing agencies, housing providers, faith-based and
community organizations, local governments, the private sector, and
other partners have come together in organized efforts to reach and
engage Veterans and the most vulnerable and unsheltered people
experiencing homelessness to link them to permanent housing with needed
supports. Id. at 15 (emphasis added).
Successful implementation occurs when there is broad
support for the strategies--this is evidenced by the involvement of
business and civic leadership, local public officials, faith-based
volunteers, and mainstream systems that provide housing, human
services, and health care. Id. at 32 (emphasis added).
Working together, we will continue to harness public and
private resources--consistent with principles of ``value for money''--
to finish the effort started by mayors, governors, legislatures,
nonprofits, faith-based and community organizations, and business
leaders across our country to end homelessness. Id. at 60 (emphasis
added).
The revised Federal strategic plan published by the USICH in 2020
continues to support engagement with faith-based and community partners
as part of the whole-of-government response to homelessness.\71\
---------------------------------------------------------------------------
\71\ USICH, Expanding the Toolbox: The Whole-of-Government
Response to Homelessness 19 (Oct. 2020), https://www.usich.gov/resources/uploads/asset_library/USICH-Expanding-the-Toolbox.pdf; see
also Administration for Children and Families, HHS, 2019 ACF
Regional Listening Sessions on Family Homelessness (Feb. 2020),
https://www.acf.hhs.gov/fysb/resource/2019-acf-regional-listening-sessions-on-family-homelessness (``We will continue to work across
ACF programs and with other federal agencies and faith-based and
community partners to strengthen our efforts to address family and
youth homelessness.'' (emphasis added)).
---------------------------------------------------------------------------
Regarding opioid abuse, a comment noted that the NPRMs ``could''
conflict with the objectives of HHS's recent Strategy to Combat Opioid
Abuse, Misuse, and Overdose (2017), https://www.hhs.gov/opioids/sites/default/files/2018/09/opioid-fivepoint-strategy-20180917/508compliant.pdf (``HHS Strategy''). However, the very HHS Strategy
cited by the commenter provided direct support for the important role
that faith-based organizations play in helping the nation address abuse
of opioids and other drugs. The first strategy presented by HHS was to
``[i]mprove access to prevention, treatment, and recovery support
services to prevent the health, social, and economic consequences
associated with opioid misuse and addiction, and to enable individuals
to achieve long-term recovery.'' Id. at 3. The HHS Strategy's
implementation relied on faith-based organizations for prevention,
treatment of addiction to opioids and other drugs, and recovery, making
a recommendation to ``[e]ngage community and faith-based organizations
to use evidence-based messages on prevention, treatment, and
recovery.'' Id. (emphasis added). It also added this component
regarding recovery from abuse of opioids and other drugs: ``[e]nhance
discharge coordination for people leaving inpatient treatment
facilities who require linkages to home and community-based services
and social supports, including case management, housing, employment,
food assistance, transportation, medical and behavioral health
services, faith-based organizations, and sober/transitional living
facilities.'' Id. at 5 (emphasis added).
Regarding HIV, a comment said that ``[w]eakening beneficiary
protections could create inconsistency with the President's Ending the
HIV Epidemic: A Plan for America initiative (``EHE Initiative''), which
seeks to reduce new HIV infections by 75% in five years and by 90% in
ten years.'' \72\ The same web page announcing the EHE Initiative
declares the importance of faith-based organizations in reducing HIV
infections nationwide. It states:
---------------------------------------------------------------------------
\72\ HHS, Overview, About Ending the HIV Epidemic: Plan for
America, https://www.hiv.gov/federal-response/ending-the-hiv-epidemic/overview.
Achieving EHE's goals will require a whole-of-society effort. In
addition to the coordination across federal agencies, the success of
this initiative will also depend on
[[Page 82101]]
dedicated partners working at all sectors of society, including
people with HIV or at risk for HIV; city, county, tribal, and state
health departments and other agencies; local clinics and healthcare
facilities; healthcare providers; providers of medication-assisted
treatment for opioid use disorder; professional associations;
advocates; community- and faith-based organizations; and academic
and research institutions, among others. Engagement of community in
developing and implementing jurisdictional EHE plans as well as in
the planning, design, and delivery of local HIV prevention and care
---------------------------------------------------------------------------
services are vital to the initiative's success.
(Emphasis added.)
When the Agency programs highlight the benefits of participation by
faith-based organizations, it is hard to see how it is contrary to
those programs to ensure that such organizations are eligible to
participate in those programs on equal terms with secular organizations
and subject to accommodations provided for in existing Federal laws.
The objectives of these programs are consistent with this final rule
and could not override the First Amendment and RFRA concerns that are
part of the basis for this final rule. And to be clear, in the event of
any unanticipated conflict between the final rule and an applicable
program statute for which the First Amendment, RFRA, or another Federal
law do not provide an exception, the Agencies will follow the
requirements of the program statute.
Changes: None.
Affected Regulations: None.
J. Procedural Requirements
1. Comment Period
HUD provided a 60-day comment period for its NPRM. The eight other
Agencies provided a 30-day comment period.
Summary of Comments: Some commenters argued that the other
Agencies' comment periods should have been longer because the proposed
rules were complex, pointing out that OMB designated this coordinated
rulemaking a significant regulatory action. Some comments asserted that
the APA, 5 U.S.C. 551 et seq.; Executive Order 12866 of September 30,
1993, Regulatory Planning and Review, 58 FR 51735, and Executive Order
13563 of January 18, 2011, Improving Regulation and Regulatory Review,
76 FR 3821; and ``agency precedents'' provide that comment periods
should generally be at least 60 days, and courts hold that a shorter
period must be justified by the ``good cause'' exception in the APA.
Some comments also cited Housing Study Group v. Kemp, 736 F. Supp. 321,
334 (D.D.C. 1990). Some comments asserted that the Agencies had worked
on the proposals for ``many months,'' so the public should have more
than 30 days to respond. Some comments pointed out that HUD allowed 60
days for comments, so the other Agencies also should have provided that
many days, or should at least consider the comments made to HUD.
Response: The APA does not specify a minimum public comment period.
See 5 U.S.C. 553(b). Executive Orders 12866 and 13563 encourage
agencies to provide comment periods of at least 60 days, but do not
mandate this. And, aside from HUD, no ``agency precedents'' bind the
Agencies to 60-day comment periods. In contrast, HUD, pursuant to its
unique rule on rulemaking at 24 CFR 10.1, requires a 60-day comment
period. And HUD complied with that requirement here.
The Agencies disagree that Housing Study Group applies here. That
case addressed an interim final rule that was promulgated after a 30-
day notice-and-comment period. 736 F. Supp. at 334. But the court
recognized later in the same case that the 60-day requirement is based
on HUD's unique regulations. See Housing Study Group v. Kemp, 739 F.
Supp. 633, 635 n.6 (D.D.C. 1990) (citing 24 CFR 10.1).
The eight other Agencies that selected a 30-day comment period
provided sufficient opportunity for interested persons to meaningfully
review the proposed rules and provide informed comment. The large
number of comments received, many of which were substantive and
detailed, show that the comment period was adequate.\73\ Moreover, the
existing regulations are not lengthy or complex. For example, DOJ's
regulations in 28 CFR part 38 (including the two short appendices)
consist of a few pages of text. Also, the NPRMs are not lengthy and are
mostly repetitive. For example, the NPRMs for DHS, USDA, USAID, DOJ,
DOL, VA, HHS, and HUD are each between 6 and 14 pages, with the
regulatory text appearing on 2 to 4 pages. To be sure, ED's NPRM is
longer, but it also separated out the unique aspects of its proposed
rules into a separate final rule that has already been promulgated.
Direct Grant Programs, State-Administered Formula Grant Programs, Non
Discrimination on the Basis of Sex in Education Programs or Activities
Receiving Federal Financial Assistance, Developing Hispanic-Serving
Institutions Program, Strengthening Institutions Program, Strengthening
Historically Black Colleges and Universities Program, and Strengthening
Historically Black Graduate Institutions Program, 85 FR 59916 (Sept.
23, 2020).
---------------------------------------------------------------------------
\73\ Cf. Nat'l Lifeline Ass'n v. FCC, 921 F.3d 1102, 1117 (D.C.
Cir. 2019) (``When substantial rule changes are proposed, a 30-day
comment period is generally the shortest time period sufficient for
interested persons to meaningfully review a proposed rule and
provide informed comment.'' (citations omitted)).
---------------------------------------------------------------------------
Although OMB designated the proposed rules as significant
regulatory actions, such a designation, in itself, is not necessarily
indicative of how much time is needed to review and comment on that
rule. See E.O. 12866, sec. 3(f) (setting out a variety of factors for
designation). Similarly, the length of time an agency works on a
proposed rule does not necessarily correspond to the length of time an
agency should allow for comment. Here, the coordination prior to
publication resulted in a rule coordinated (and generally consistent)
across several Agencies, thus reducing complexity for commenters. The
Agencies considered all comments submitted in response to the
concurrent rulemaking, including those submitted to HUD during its 60-
day comment period, as commenters recommended. In fact, most of the
comments on the HUD version overlap with those submitted to DOJ,
suggesting that additional time was not required for robust review and
comment.
Changes: None.
Affected Regulations: None.
2. Arbitrariness and Capriciousness
Summary of Comments: Some commenters, including a local government
and advocacy organizations, asserted that the proposed rules violated
the APA because the proposed changes were ``arbitrary and capricious.''
They reasoned that the Agencies did not establish a ``rational
connection'' between the underlying facts and their policy choices and
did not offer a ``reasoned explanation'' for their changes to existing
requirements, citing Motor Vehicle Manufacturers Ass'n of the United
States v. State Farm Mutual Automobile Insurance Co., 463 U.S. 29, 43
(1983). Some advocacy organizations stated that the proposed rules were
contrary to the APA because the Agencies ``failed to consider an
important aspect of the problem'' when they issued the proposed rules.
Id. A few advocacy organizations warned that agency actions based on
arguments ``counter to the evidence'' do not meet the requirements of
the APA. Id.
Similarly, another organization criticized the Agencies for
offering little explanation or the required rational connection for
changes that could adversely affect individuals. One organization
asserted that the Agencies
[[Page 82102]]
did not fulfill their obligations under the APA to support each
proposed change from the status quo with a ``reasoned analysis,'' Motor
Vehicle Mfrs., 463 U.S. at 42; Washington v. Azar, 376 F. Supp. 3d
1119, 1131 (E.D. Wash. 2019), vacated and remanded sub nom. Becerra v.
Azar, 950 F.3d 1067 (9th Cir. 2020), that addresses the facts and
arguments underlying the existing provision, Encino Motorcars, LLC v.
Navarro, 136 S. Ct. 2117, 2125-26 (2017); FCC v. Fox Television
Stations, Inc., 556 U.S. 502, 515 (2009), and clearly justifies the
reversal. The commenter described a presumption against changes lacking
support in the rulemaking record, Motor Vehicle Mfrs., 463 U.S. at 42,
and warned that, although Executive Order 13831 overturned the
Government-wide notice-and-referral requirements of Executive Order
13279, as amended, the Agencies must still justify the corresponding
changes to the regulations. The commenter stated that the Agencies
offered ``no evidence'' in the proposed rules that the provisions were
not functioning and required replacement. A different organization
argued that when agencies propose material changes in policy, adherence
to APA requirements is of greater significance because of the potential
harm to ``serious reliance interests,'' Fox Television Stations, 556
U.S. at 515, and commented that failure to explain a departure from
standing policy could constitute ``an arbitrary and capricious change
from agency practice,'' Nat'l Cable & Telecomms. Ass'n v. Brand X
Internet Servs., 545 U.S. 967, 981 (2005). The commenter also stated
that, because the Agencies did not scrutinize the proposed rules'
effect on beneficiaries or employees, the proposed rules did not meet
the reasoned analysis standard under the APA.
Some advocacy organizations criticized the rationales provided for
the proposed revisions as inadequate. One organization commented that
the Agencies neglected to identify what problems of administration the
proposed rules were meant to correct and lacked support for the claim
that the notice-and-referral requirements burdened providers.
Additionally, the commenter argued that the Agencies failed to justify
the expansion of religious exemptions for providers and did not account
for how coercion or lack of alternatives would affect beneficiaries. A
different organization, citing the Agencies' statements in the NPRMs
that they could not quantify the cost of the referral requirement and
welcomed data that would aid in developing such estimates, concluded
that the Agencies could not provide an adequate basis for rescinding
the requirement. The commenter criticized the Agencies' reliance on
RFRA and Trinity Lutheran for support as ``cursory and flawed,'' and
maintained that the Agencies had not met their burden under the APA to
offer a reasoned explanation for the change, citing Fox Television
Stations, 556 U.S. at 515. Addressing other proposed revisions, the
commenter stated that the proposals to broaden religious exemptions and
redefine indirect assistance also lacked sufficient rationales as the
Agencies' arguments concerning alignment with the First Amendment and
RFRA were inadequate.
Response: The Agencies disagree with comments that suggested the
proposed rulemaking was ``arbitrary and capricious'' in violation of
the APA because it ``failed to present a reasoned analysis'' for a
substantial change in policy and ``failed to articulate a rational
connection between the facts found and the choices made.'' Under the
APA, courts review the Agencies' exercise of discretion under the
deferential ``arbitrary and capricious'' standard. See 5 U.S.C.
706(2)(A). The court's review is ``narrow,'' and the court may review
the Agencies' exercise of discretion only to determine if the Agencies
``examined `the relevant data' and articulated `a satisfactory
explanation' for [the] decision, including a rational connection
between the facts found and the choice made.'' Dep't of Commerce v. New
York, 139 S. Ct. 2551, 2569 (2019) (citations omitted). Courts may not
substitute their judgments for the Agencies', ``but instead must
confine [them]selves to ensuring that [the Agencies] remained `within
the bounds of reasoned decision-making.' '' Id. (citation omitted).
The Supreme Court has recognized that agencies may change policy
when such changes are ``permissible under the statute, . . . there are
good reasons for [them], and . . . the agency believes [them] to be
better'' than prior policies. Fox Television Stations, 556 U.S. at 515.
Courts also have noted that agencies are not bound by prior policies or
interpretations of their statutory authority.\74\ In addition, an
agency need not prove that the new interpretation is the best
interpretation but should acknowledge that it is making a change,
provide a reasoned explanation for the change, and indicate why it
believes the new interpretation of its authority is better. See
generally Fox Television Stations, 556 U.S. 502.
---------------------------------------------------------------------------
\74\ See, e.g., Rust v. Sullivan, 500 U.S. 173, 186-87 (1991)
(acknowledging that changed circumstances and policy revision may
serve as a valid basis for changes in agency interpretations of
statutes); Chevron, U.S.A., Inc. v. Nat. Res. Def. Council, Inc.,
467 U.S. 837, 863-64 (1984) (``The fact that the agency has from
time to time changed its interpretation of the term `source' does
not, as respondents argue, lead us to conclude that no deference
should be accorded the agency's interpretation of the statute. An
initial agency interpretation is not instantly carved in stone. On
the contrary, the agency, to engage in informed rulemaking, must
consider varying interpretations and the wisdom of its policy on a
continuing basis.''); Motor Vehicle Mfrs., 463 U.S. at 42 (agencies
``must be given ample latitude to `adapt their rules and policies to
the demands of changing circumstances' '' (quoting Permian Basin
Area Rate Cases, 390 U.S. 747, 784 (1968))).
---------------------------------------------------------------------------
The Agencies easily meet these requirements of the APA by providing
detailed and reasoned explanations for their proposed changes. As the
Agencies explained in proposing the amendments, the proposed changes
implement Executive Order 13831 and conform the regulations more
closely to the Supreme Court's current First Amendment jurisprudence;
relevant Federal statutes such as RFRA; Executive Order 13279, as
amended by Executive Orders 13559 and 13831; and the Attorney General's
Memorandum.
The NPRMs explained that, in order to be consistent with these
authorities, the proposed rules would conform to Executive Order 13279,
as amended, by deleting the requirement that faith-based social service
providers refer beneficiaries objecting to receiving services from them
to an alternative provider and the requirement that faith-based
organizations provide notices that are not required of secular
organizations. As the NPRMs also explained, President Obama's Executive
Order 13559 imposed notice and referral burdens on faith-based
organizations that are not imposed on secular organizations. Section
1(b) of Executive Order 13559 had amended section 2 of Executive Order
13279 in pertinent part by adding a new subsection (h) to section 2. As
amended, section 2(h)(i) provided that if a beneficiary or a
prospective beneficiary of a social service program supported by
Federal financial assistance objected to the religious character of an
organization that provided services under the program, that
organization was required, within a reasonable time after the date of
the objection, to refer the beneficiary to an alternative provider.
Section 2(h)(ii) directed the Agencies to establish policies and
procedures to ensure that referrals would be timely and would follow
privacy laws and regulations; that providers notify the Agencies of and
track referrals; and that
[[Page 82103]]
each beneficiary ``receive [] written notice of the protections set
forth in this subsection prior to enrolling in or receiving services
from such program.'' The reference to ``this subsection'' rather than
to ``this section'' indicated that the notice requirement of section
2(h)(ii) was referring only to the alternative provider provisions in
subsection (h), not all of the protections in section 2.
When revising their regulations in 2016, the Agencies explained
that the revisions would implement the alternative provider provisions
in Executive Order 13559. Executive Order 13831, however, has removed
the alternative provider requirements articulated in Executive Order
13559. The Agencies also previously took the position that the
alternative provider provisions would protect religious liberties of
social service beneficiaries. But such methods of protecting those
rights were not required by the Constitution or any applicable law.
Indeed, the selected methods were in tension with more recent Supreme
Court precedent--including Espinoza and Trinity Lutheran--regarding
nondiscrimination against religious organizations, with the binding
legal principles discussed in the Attorney General's Memorandum, and
with RFRA, as explained in the NPRMs and in detail in Part II.C. The
Agencies also now disagree that these requirements meaningfully
protected any beneficiary's religious liberties, as discussed in Part
II.C.1. And the Agencies incorporate their analysis of the costs and
benefits from Part IV below.
Executive Order 13831 chose to eliminate the alternative provider
requirement for good reason. This decision avoids tension with the
nondiscrimination principles articulated in Trinity Lutheran and
summarized in the Attorney General's Memorandum, avoids problems that
may arise under RFRA, and fits within the Administration's broader
deregulatory agenda. Moreover, as explained in detail in Part II.C, the
Agencies exercise their discretion to remove the alternative provider
requirement because that is the appropriate legal and policy choice.
Similarly, the Agencies have provided reasoned explanations
throughout this preamble for all of the other clarifications,
additions, and changes in this final rule, which they incorporate here.
Thus, the Agencies disagree that this rulemaking is ``arbitrary and
capricious,'' has not been explained or adequately supported, or
otherwise has violated the requirements of the APA.
Changes: None.
Affected Regulations: None.
K. Regulatory Certifications
1. Regulatory Impact Analysis (Executive Orders 12866 and 13563)
Summary of Comments: Commenters argued that the proposed rules did
not adequately or accurately assess all costs and benefits associated
with the proposed rules. A few advocacy organizations commented that
``reasonable regulation ordinarily requires paying attention to the
advantages and the disadvantages of agency decisions,'' citing Michigan
v. EPA, 576 U.S. 743, 753 (2015). Another commenter relied on the
principles that, to achieve compliance with the APA, an agency ``must
examine the relevant data and articulate a satisfactory explanation,''
and that agency action may be arbitrary and capricious if it ``failed
to consider an important aspect of the problem.'' Motor Vehicle Mfrs.,
463 U.S. at 43. Commenters added that Executive Orders 12866 and 13563
require the Agencies to accurately assess the costs and benefits of a
proposed rule--both quantifiable and unquantifiable--and then make a
reasoned determination that the benefits justify the costs and that the
regulation is tailored ``to impose the least burden on society.''
Additionally, commenters emphasized that Executive Order 12866 requires
agencies to ``assess all costs and benefits'' and to ``select those
approaches that maximize net benefits.''
Applying these standards, commenters argued that the Agencies did
not adequately address the costs to beneficiaries and employees from
the regulatory changes. Some commenters argued that the Agencies had
not recognized non-quantifiable benefits (avoided costs or burdens) for
beneficiaries from the prior rule. Multiple commenters argued that the
Agencies failed to quantify the costs of removing the notice-and-
referral requirements, including failing to consider all relevant
economic and non-economic costs, failing to substantiate the claimed
cost savings with data, and asserting without support that removing a
protection would benefit beneficiaries.
One commenter listed categories of potential costs to beneficiaries
from removing the notice-and-referral requirements that, this commenter
claimed, the Agencies had not addressed. Specifically, these potential
costs included: Experiencing discrimination and barriers to access;
health costs due to discrimination; health costs from the stigmatizing
message of rules that permit discrimination; cost shifting to other
service agencies; increased confusion, familiarization, administrative,
and legal costs; and decreased fairness, dignity, and respect for the
religious freedom and constitutional rights of beneficiaries. This
commenter argued that the Agencies should use available data and
research on the costs of discrimination and the benefits of
nondiscrimination protections to try to quantify the true impacts. The
commenter claimed that depression is associated with the stress of
having faced discrimination and cited research purporting to show that
reducing the disparity in incidents of depression among LGBTQ adults by
25 percent could yield cost savings in Michigan, Arizona, Florida, and
Texas of between $78 million and $290 million annually, each.\75\ The
commenter argued that the Agencies' economic analyses were
``fundamentally flawed'' due to their failure to take into account
these costs.
---------------------------------------------------------------------------
\75\ Christy Mallory et al., The Impact of Stigma and
Discrimination Against LGBT People in Michigan 66 (Williams
Institute 2019) (``Michigan Study''), https://williamsinstitute.law.ucla.edu/wp-content/uploads/Michigan-Economic-Impact-May-2019.pdf; Christy Mallory et al., The Impact of Stigma
and Discrimination Against LGBT People in Arizona 63 (Williams
Institute 2018) (``Arizona Study''), https://williamsinstitute.law.ucla.edu/wp-content//Arizona-Impact-Discrimination-March-2018.pdf; Christy Mallory et al., The Impact of
Stigma and Discrimination Against LGBT People in Florida 64
(Williams Institute 2017) (``Florida Study''), https:/
/.law.ucla.edu//impact-lgbt-discrimination/; Christy Mallory et al.,
The Impact of Stigma and Discrimination Against LGBT People in Texas
67 (Williams Institute 2017)) (``Texas Study''), https://williamsinstitute.law.ucla.edu/wp-content//Impact-of-Stigma-and-Discrimination-Report-April-2017.pdf.
---------------------------------------------------------------------------
Commenters also argued that the Agencies only acknowledged, but did
not attempt to quantify, the discrete costs to objecting beneficiaries
that need to identify alternative providers due to removal of the
referral requirement. This commenter urged the Agencies to consider all
of the costs and benefits of the proposed rules, as well as the
possibility that the costs would outweigh the benefits.
One of these commenters argued that the Agencies had also failed to
quantify the costs of the employment law changes discussed in Part
II.H.
Additionally, one commenter asserted that the Agencies relied on
``increased clarity'' as a benefit of the proposed rules but had not
recognized that beneficiaries would not benefit from such ``increased
clarity.'' 85 FR at 2935.
Commenters also discussed the benefits to faith-based organizations
from this final rule. Several commenters argued that faith-based
organizations
[[Page 82104]]
were not harmed by the notice-and-referral requirements. Some of these
commenters argued that the Agencies did not present sufficient
evidence--beyond assumptions or ``vague references'' to administrative
burden and costs--that the notice-and-referral requirements had unduly
burdened religious service providers either economically or in their
practical ability to provide help for the needy in accord with their
faiths. Some of these commenters argued that the Agencies had not
presented any actual or even hypothetical examples of how this
requirement meaningfully burdened faith-based organizations or
interfered with their abilities to service program beneficiaries.
Another commenter said that the regulations were working well and that
the Agencies had not provided any supported reason for their changes.
Some commenters argued that there was no burden to religious
service providers because providing referrals should have been seen as
part of the services for which such providers were receiving taxpayer
funds. Another commenter claimed that the notice requirement imposed no
burden at all on faith-based providers because they were being funded
by taxpayer dollars to serve the beneficiaries.
Several commenters argued that the notice-and-referral requirements
imposed only minimal burdens on faith-based providers. Some of these
commenters emphasized that the Agencies had indicated that the costs of
the referral requirement were minimal, nonexistent, or unquantifiable.
Multiple commenters emphasized that the cost of notice was minimal
because each Agency estimated such cost to be no more than $200 per
religious organization, with some estimating the costs to be lower, in
the 2016 or 2020 rulemakings. For all of these reasons, these
commenters concluded that removal of the notice requirement would not
result in substantial savings for faith-based organizations.
Some of these commenters disagreed with the Agencies' claims that
removing the notice-and-referral requirements could create cost savings
that faith-based providers could re-allocate to increase services or
that could incentivize them to increase their participation in
federally funded programs. These commenters argued that, because
compliance required minor efforts and costs, removing these
requirements would neither make significant extra resources available
nor result in significant additional providers. Some of these
commenters claimed that the Agencies had not demonstrated that any
religious organization was not participating in these programs because
of these requirements, or that there were insufficient providers to
meet the programs' needs. Some commenters also argued that it was
contradictory or inconsistent for the Agencies to claim that the cost
savings from removing the notice-and-referral requirements could
trigger a noticeable increase in services, see, e.g., 85 FR at 2935,
8221-22, but then to claim that beneficiaries did not use referrals.
For these reasons, commenters argued that cost savings to faith-
based organizations cannot justify removal of the notice-and-referral
requirements. One commenter to multiple Agencies, however, explained
that removal of the notice-and-referral requirements would enable
religious organizations to continue working towards strengthening
society.
Commenters also compared the benefits and burdens to beneficiaries
against the benefits and burdens to faith-based organizations. Several
commenters argued that any burdens on faith-based organizations imposed
by the notice-and-referral requirements were outweighed by the benefits
they provided to beneficiaries. Relying on the discussions in this
section and in Part II.C, these commenters compared the various
described burdens to faith-based organizations, which they claimed were
minimal or non-existent, to the various claimed benefits to
beneficiaries, which they claimed were significant. Some of these
commenters stated that the unquantified costs to beneficiaries
associated with removal of the notice-and-referral requirements could
offset or exceed any savings for providers. One commenter argued that
the Agencies provided ``no evidence'' that any of the changes to
beneficiaries' protections would result in net benefits because of the
high costs to beneficiaries and society.
Some commenters expressed concern that the Agencies appeared to
value the religious liberty of providers above that of beneficiaries
and urged the Agencies to evaluate them equally. These commenters
criticized the Agencies for proposing several measures to remove ``any
possible burden'' or lack of clarity for providers while eliminating
``the only means'' for beneficiaries to receive notice of their rights
as well as the requirement to be given a referral upon request.
Some commenters argued that nothing had changed since 2016 to
justify the Agencies' changed positions regarding the balance of
benefits and burdens. In 2016, the Agencies concluded that the notice
requirement was ``designed to limit the burden on'' providers while
being ``justified by the value to beneficiaries'' (i.e., ``valuable
protections of their religious liberty''). 81 FR at 19365.
Additionally, in 2016, the Agencies determined that there was no
``undue burden'' from requiring notice of such ``valuable protections''
of beneficiaries' ``religious liberty.'' Id. These commenters argued
that it was ``contradictory'' to claim now that the burdens of these
requirements justify their removal and that the Agencies had dismissed
these conclusions without evidence or reasoned analysis.
Other commenters pointed to the 2010 Advisory Council Report that,
they claimed, had recognized the notice-and-referral requirements could
impose significant monetary costs on providers but still concluded that
those costs were necessary to adequately protect beneficiaries'
unquantifiable fundamental religious liberties. Advisory Council Report
at 141.
Finally, a commenter argued that the reasoned explanation standard
was not met when eight of the Agencies (all except HHS) stated that
they based removal of the notice-and-referral requirements (and other
regulatory provisions) on a ``reasoned determination'' that the
proposal would significantly decrease costs for providers, citing 85 FR
at 2894 (DHS); id. at 2902-03 (USDA); id. at 2919 (USAID); id. at 2925-
26 (DOJ); id. at 2935 (DOL); id. at 2944 (VA); id. at 3215, 3219 (ED);
id. at 8221-22 (HUD).
Response: In this final rule, the Agencies adequately and
appropriately consider the costs and benefits of this final rule, as
well as the balance between them, to select the approaches that
maximize net benefits and that impose the smallest burdens on society.
The Agencies disagree with the comments to the contrary.
In the relevant sections above for each regulatory provision, the
Agencies have addressed the specific comments regarding the potential
impact on beneficiaries or employees that were raised in the comments,
including by explaining the Agencies' experiences over the past four
years, where relevant. Most of these comments focus on removal of the
notice-and-referral requirements. The Agencies have considered the
alleged harms to beneficiaries from removing these requirements as
described in great detail in Part II.C, including detailed analyses of
commenters' actual examples, studies, surveys, and hypothetical
examples. For all of the reasons discussed there, the Agencies disagree
that removing the notice-and-referral requirements will cause the harms
[[Page 82105]]
claimed by commenters. Indeed, as discussed, there is no indication by
any Agency or commenter that anyone actually sought a referral at any
time during the last four years.
Part II.C addresses in detail the reasons that removal of the
notice-and-referral requirements will not lead to increased
discrimination against any beneficiaries. Additionally, the studies
cited by a commenter regarding the impact of reducing LGBTQ depression
do not indicate that there will be any increase in discrimination or
depression due to removal of the notice-and-referral requirements, that
faith-based providers have higher incidents of discrimination, or that
any discrimination or depression would be prevented or reduced by
notice and referral. For example, those surveys point to the prevalence
of LGBT people using Federal programs, such as SNAP, but do not point
to prevalent discrimination in those programs, let alone discrimination
particular to faith-based providers in such programs.\76\ Moreover,
those studies specifically did not discuss Federal protections in the
programs governed by this final rule that prohibit discrimination based
on sex, including under Title VII, because that was ``outside the scope
of'' each study.\77\ The Agencies have, thus, considered these costs
and reasonably determined that specific calculations are not warranted.
---------------------------------------------------------------------------
\76\ Michigan Study at 41-42; Arizona Study at 36-37; Florida
Study at 40-41; Texas Study at 39-40.
\77\ Michigan Study at 16 n.67; Arizona Study at 12 n.47;
Florida Study at 13 n.43; Texas Study at 13 n.50.
---------------------------------------------------------------------------
As a result, and as discussed in Part II.C, the Agencies determine
that removal of these notice-and-referral requirements will not cause
the harms to beneficiaries cited by commenters. Because removing these
requirements will not increase discrimination, there will not be
increased costs to beneficiaries from experiencing discrimination and
barriers to access, health costs due to discrimination, health costs
from the stigmatizing message of rules that permit discrimination, or
cost shifting to other service agencies. Additionally, there is no
reason to believe that beneficiaries will experience increased
confusion, familiarization costs, administrative costs, or legal costs,
just as there is no reason to believe that they have experienced such
costs when receiving services from the providers that were exempt from
these requirements. And there is no reason to believe that removal will
cause decreased fairness, dignity, and respect for the religious
freedom and constitutional rights of beneficiaries, which are not
affected by this rule change, as discussed in Part II.C. Also, as
discussed in Parts II.C, II.E, II.F, and II.G.3, the Agencies address
any such burdens within their notices to faith-based organizations of
the applicable beneficiary protections and within the context-specific
accommodation analyses under other existing Federal laws that are
explicitly recognized in this final rule.
Moreover, beneficiaries may benefit from removal of these notice-
and-referral requirements. As discussed in Part II.C, this final rule
removes the various confusing aspects of these requirements, including
the implications that they applied only to faith-based organizations,
that accommodations were not available, contrary to the Free Exercise
Clause and RFRA (which overrode any such implication in the
regulations), and that discrimination on grounds other than religion
was not prohibited. At the very least, these beneficiaries will be in
the same position as beneficiaries of providers that were never subject
to these requirements.
The Agencies have also considered the costs for beneficiaries, if
they object based on religious character, to identify an alternative
provider. The Agencies incorporate their discussion of this alleged
burden from Part II.C, including that they have no indication that
anyone sought a referral under the prior rule and that there are
readily available ways for any such beneficiary to locate a substitute,
to the extent one is available. Additionally, the Agencies expressly
invited comments on any data by which they could calculate such costs,
see, e.g., 85 FR at 2926 (DOJ), but no commenter provided any such
information. The Agencies invited similar information regarding how
they could better assess other actual costs and benefits of the prior
rule but did not receive any responses that provided a reliable
methodology for such assessments. The Agencies have considered these
issues and reasonably determine that further calculations are not
warranted.
In contrast, the Agencies conclude that the notice-and-referral
requirements imposed substantial non-monetary burdens on faith-based
organizations due to unequal treatment, in tension with the Free
Exercise Clause and RFRA, and concerns that could have deterred faith-
based organizations from applying to participate in such grant
programs, as discussed in Part II.C. Additionally, the notice
requirement created confusion because it omitted any discussion of
accommodations, was inconsistent with the provisions in four Agencies'
regulations that no additional assurance or notice be required from
faith-based organizations regarding explicitly religious activities as
discussed in Part II.G.4, and was in tension with each Agency's general
provision in the rule promising that faith-based organizations retained
their independence. In combination with all of the other changes in
this final rule, removing the notice-and-referral requirements provides
much-needed clarity that faith-based organizations can participate in
these programs on equal terms with secular organizations, consistent
with the Religion Clauses and RFRA. And, as discussed in Parts II.E and
II.F above, otherwise eligible faith-based organizations have been
abstaining from applying for these programs, have been excluded from
these programs, or have been challenged for participating in these
programs due to the lack of clarity in the 2016 rule. As discussed in
Part II.C, these notice-and-referral requirements stigmatized faith-
based organizations as most likely to be objectionable or to violate
beneficiaries' rights. Although the Agencies agree that they cannot
quantify these burdens, they do not agree that these unquantifiable
burdens are insufficient bases for rule changes. Also, the supportive
comments demonstrate that some faith-based providers were burdened by
the notice-and-referral requirements, including the stigmatization that
such requirements caused.
The Agencies disagree with the contention that mandatory referrals
by only specific faith-based organizations should be seen as part of
the federally funded service. The Federal financial assistance is for
the provision of services, whereas referral was the non-provision of
services. To assert that mandatory referrals constituted a part of the
federally funded service misunderstands the nature of Federal funding,
where a Federal grant award supports particular enumerated activities
to be undertaken by a recipient. Commenters making this claim did not
provide any indication that such mandatory referrals were included as
an enumerated activity to be undertaken by any Agency with Federal
funding. Further, referral as part of the service is hard to reconcile
with the referral requirement's function of allowing objecting
beneficiaries to avoid receiving any services from a provider. If the
referral were part of the provider's service, then the referral would
undermine the claimed protection and could make the referral itself
objectionable. Under this final rule, religious organizations remain
free to
[[Page 82106]]
make such referrals if they choose, and some commenters indicated that
they will continue to do so.
Similarly, the Agencies disagree that there can be no burden on the
faith-based providers because they were receiving taxpayer funding and
must adhere to religious freedom safeguards. Receipt of taxpayer
funding does not cause faith-based organizations to waive their
constitutional and statutory religious liberties, just as it does not
waive such rights for beneficiaries. These comments directly contradict
Espinoza, Trinity Lutheran, many applications of RFRA, and countless
other Supreme Court cases that allowed faith-based providers to
participate in government-funded programs without surrendering their
religious character or liberty. Additionally, the Agencies determine
that the notice-and-referral requirements did not safeguard
beneficiaries' religious freedoms, as discussed in Part II.C.
The Agencies agree with the comments that said the notice-and-
referral requirements likely imposed minimal monetary costs on faith-
based organizations and that removal will not create significant
financial savings for faith-based organizations. Neither notices nor
referrals were particularly expensive, as the Agencies noted in the
2016 rule and in their 2020 NPRMs. Also, there is no indication anyone
actually requested a referral under the prior rule, as discussed in
Part II.C.3.c. Nevertheless, based on their experiences and the
comments they received, the Agencies have re-evaluated the number of
known faith-based organizations receiving their grants and estimated
the cost savings for those providers from removal of the notice-and-
referral requirements. An updated analysis of these costs and benefits
is set out below in the Regulatory Certifications section addressing
Executive Orders 12866 and 13563.
The Agencies expressly conclude that those cost savings will not be
substantial and are not the basis for removal of the notice-and-
referral requirements in this final rule. Although the cost savings
from removing the notice requirement are not significant and will not
make available significant funding for significant increases in
services, the Agencies also exercise their discretion to allow faith-
based providers, like other providers, to save those costs and be able
to allocate any savings toward providing additional services to
beneficiaries. It is consistent to conclude that these savings are
minimal and that they can be allocated toward providing services to
beneficiaries.
Additionally, the Agencies disagree that their conclusion here
regarding the burden of referrals is inconsistent with their conclusion
that beneficiaries rarely or never sought referrals. For both, the
Agencies conclude that referrals were rarely or never sought. As
discussed above, the Agencies are not claiming substantial savings to
faith-based providers from removing the referral requirement, including
because there were few, if any, requests for such referrals. But that
does not diminish the constitutional and other non-quantified burdens
on faith-based organizations that are the bases for removing the
referral requirement. Moreover, faith-based service providers that are
subject to these regulations will save costs as a result of removing
the notice requirement.
The Agencies conclude that removing the notice-and-referral
requirements reaches the appropriate balance between benefits and
burdens for all stakeholders and society, for all of the reasons
discussed throughout this final rule, including in this section. As
discussed above, the Agencies conclude that such removal will
substantially benefit faith-based organizations, may benefit
beneficiaries, and will not harm beneficiaries. Additionally, the
Agencies are further accounting for beneficiaries' rights by separately
giving express notice to faith-based providers that they must comply
with the applicable beneficiary protections and providing for context-
specific accommodations that further balance stakeholder interests,
which may result in targeted and appropriate notices and referrals.
That is the appropriate policy choice for all of the reasons discussed
throughout Parts II.C, II.E, and II.G.3.
Since 2016, the Agencies have re-evaluated their analyses on this
balancing of interests with respect to the notice-and-referral
requirements for all of the reasons explained throughout this section
and Part II.C, including their experiences of no known actual instances
of referrals (and, thus, the lack of need for such requirement) and the
developments in First Amendment and RFRA case law, such as the Supreme
Court's decisions in Little Sisters, Espinoza, and Trinity Lutheran.
Additionally, this final rule is a deregulatory action under Executive
Order 13771 of January 30, 2017, Reducing Regulation and Controlling
Regulatory Costs, 82 FR 9339, with the cost savings of this rulemaking
at $190,409 (in 2016 dollars) when annualized over a perpetual time
horizon at a 7 percent discount rate.
The Agencies note that a commenter misquoted the Advisory Council
Report. The commenter claimed that the Advisory Council Report
acknowledged there would be significant monetary costs to ``providers''
from such notice-and-referral requirements. However, the cited page of
the Advisory Council Report actually said there would be significant
monetary costs to the Government. Advisory Council Report at 141. The
Agencies acknowledge that they have absorbed costs due to those
recommendations. But, as discussed above, the Agencies do not find, and
do not base this final rule on, substantial costs to providers (or to
themselves) from these requirements.
Even if the burdens on beneficiaries from removing the notice-and-
referral requirements were to outweigh the benefits to faith-based
organizations, the Agencies find ample bases to exercise their
discretion to remove these requirements for all of the other reasons
discussed in Part II.C, especially to alleviate the tension with the
Free Exercise Clause and with RFRA. Those bases do not improperly
prioritize faith-based organizations over beneficiaries. Even the 2010
Advisory Council recommended that Executive Order 13279 be amended ``to
make it clear that fidelity to constitutional principles is an
objective that is as important as the goal of distributing Federal
financial assistance in the most effective and efficient manner
possible.'' Advisory Council Report at 127 (Recommendation 4). The
Agencies agree. Serving beneficiaries is an important goal of these
programs, but the programs serving beneficiaries must be operated
consistent with constitutional principles, including protection of the
religious liberty of organizations that implement them.
The Agencies have also considered the costs and benefits of the
other changes in this final rule. The Agencies do not anticipate harm
to beneficiaries from the modifications to indirect Federal financial
assistance for the reasons discussed in Part II.D. Beneficiaries select
those providers through genuine independent choice, beneficiaries are
free to decide whether or not to accept such services from faith-based
organizations, and other protections continue to apply. The minimal or
nonexistent harms to beneficiaries are justified by the benefits of
this final rule, as described in Part II.D, including the non-
quantifiable qualitative benefits of reconciling the tension between
this provision and the constitutional standard, ensuring that faith-
based organizations are not discouraged from participating in Federal
financial assistance programs and activities, and ensuring that
[[Page 82107]]
services are available in unserved and underserved communities.
Additionally, as discussed in Part II.D, this provision is the
appropriate policy choice, including because the Agencies prioritize
making services available in unserved and underserved communities.
Similarly, the benefits and burdens of the other changes are
addressed above in Parts II.E, II.F, II.G, and II.H. As discussed in
Parts II.E and II.F, the Agencies are retaining the constitutional and
statutory accommodation and nondiscrimination standards, which do not
cause any new burden to beneficiaries. Any burden caused by each
standard would exist whether or not that standard is expressly
incorporated into this final rule. Also, those existing standards
incorporate context-specific balancing that evaluates the costs and
benefits as appropriate. As discussed in Part II.F, the Agencies have
also considered the comments regarding burdens on beneficiaries due to
the proposed language in the NPRMs for the RFRA standard and have
modified the regulatory text to ensure the appropriate balance with
regard to prohibiting discrimination based on religious exercise. The
benefits of clearly applying these standards and ensuring faith-based
providers can participate on equal terms justify the potential burdens.
For similar reasons and as discussed in Part II.G, the benefits
justify the potential burdens--and the Agencies do not anticipate
burdens--from clarifying the scope of allowed religious displays,
clarifying how an organization can demonstrate nonprofit status, giving
notice to faith-based organizations, barring unique assurances or
notices solely from faith-based organizations, and clarifying that
faith-based organizations retain their autonomy and expression rights.
Indeed, those clarifications will protect both faith-based
organizations and beneficiaries from uncertainty. And the notice to
faith-based organizations will make clear their obligations to protect
beneficiaries' rights, as discussed in Parts II.C and II.G.3.
Finally, and as explained in Part II.H, ED, HHS, HUD, DOL, USAID,
and VA conclude that the benefits justify any burdens from clarifying
that faith-based organizations retain their Title VII exemption
regarding acceptance of and adherence to religious tenets. This well-
established Title VII standard was subsumed within the prior rule. This
final rule merely adds clarity, ensures faith-based organizations can
preserve their autonomy and identities, and does not alter protections
against discrimination on other bases, as discussed in II.H.2.a.
Additionally, DHS, DOJ, and HUD conclude that the benefits of
clarifying that faith-based organizations' independence generally
allows them to select board members based on acceptance of or adherence
to religious tenets justifies any costs that such change might cause,
as discussed in II.H.2.b.
For all of these reasons, the Agencies' NPRMs and this final rule
reasonably assess the costs and benefits associated with this rule, pay
attention to the advantages and disadvantages of this rule, examine the
relevant data and articulate a satisfactory explanation, and consider
the important aspects of the problem. The Agencies have considered all
comments submitted, including those addressing costs and benefits, in
publishing this final rule.
Changes: None.
Affected Regulations: None.
2. Economic Significance Determination (Executive Order 12866)
Summary of Comments: A commenter asserted that the proposed rules
would be economically significant under Executive Order 12866, both
because the costs would total over $100 million per year, and because
it ``may . . . adversely affect in a material way . . . public health
or safety, or State, local, or tribal governments or communities.''
This commenter argued that the Agencies' cost analyses were too narrow,
excluding potentially significant costs to third parties (e.g.,
beneficiaries, communities, and funded organizations) because of the
scale of programs affected by the proposed rules.
Response: The Office of Information and Regulatory Affairs
(``OIRA'') within OMB determined that this final rule is a significant,
but not an economically significant, regulatory action subject to
review by OMB under section 3(f) of Executive Order 12866. As discussed
in the updated Regulatory Impact Analysis in Part IV below and in Parts
II.C and II.K.1 above, this final rule will not create new marginal
costs from the status quo, even though the underlying programs involve
government spending. In fact, this final rule will result in de minimis
cost savings, and it is deregulatory because it reduces qualitative
burdens. Consequently, it does not approach the threshold for being an
economically significant rule (annual effect of $100 million or more)
under Executive Order 12866, nor, for the reasons set out in detail in
the other sections, does it adversely affect in a material way the
other items listed in section 3(f)(1) of that order.
Changes: None.
Affected Regulations: None.
3. Deregulatory Action Determination (Executive Order 13771)
Summary of Comments: A commenter criticized multiple Agencies for
concluding that removal of the notice-and-referral requirements
promotes the Administration's deregulatory agenda. The commenter argued
that doing so privileges policy goals above religious freedom.
Response: Removing the notice-and-referral requirements promotes
the Administration's deregulatory agenda, which is a desirable policy
outcome for the Agencies. But that is not the primary basis for
removing them. The Agencies base the removal of the notice-and-referral
requirements on all of the reasons discussed throughout Parts II.C and
II.K.1 above, including that those requirements were imposed solely on
faith-based organizations, creating tension with the Free Exercise
Clause and RFRA, and that there was no evidence anybody had actually
sought a referral in one of the programs covered by the rule.
Changes: None.
Affected Regulations: None.
4. Federalism (Executive Order 13132)
Summary of Comments: A commenter criticized multiple Agencies'
federalism analyses as flawed, arguing that because the proposed rules
introduced loopholes and overturned the existing regulatory regime,
State and local jurisdictions would have a harder time protecting their
workers and enforcing nondiscrimination laws of general applicability.
Additionally, the commenter asserted that the proposed rules would
burden State governments by increasing unemployment and, therefore, the
need for State-funded welfare benefits, because more people will be
turned down for employment. Similarly, the commenter maintained that
both State and local governments would face higher demands for the
social services they fund because beneficiaries will experience
barriers to access in programs funded by the Agencies. The commenter
warned that the proposed rules violated the APA because the Agencies'
determinations regarding federalism implications were not based on a
reasoned analysis.
Response: Executive Order 13132 of August 4, 1999, Federalism, 64
FR 43255, directs that, to the extent practicable and permitted by law,
an agency shall not promulgate any regulation that has federalism
implications, that imposes substantial direct compliance costs on State
and local governments, and that is not
[[Page 82108]]
required by statute, or any regulation that preempts State law, unless
the agency meets the consultation and funding requirements of section 6
of the Executive Order. None of the changes made by this rule has
federalism implications as defined in the Executive Order, nor imposes
direct compliance costs on State and local governments. None of the
changes made by this rule preempts State or local law within the
meaning of the Executive Order, as stated expressly regarding Executive
Orders 12988 and 13132. See Part IV below (regarding both Executive
Orders); 85 FR at 2895 (DHS); id. at 2904 (USDA); id. at 2920 (USAID);
id. at 2927 (DOJ); id. at 2935-36 (DOL); id. at 2944 (VA); id. at 2985
(HHS); id. at 8222 (HUD). The Agencies do not expect that this rule
will increase unemployment or unlawful discrimination in any way (see
the detailed analysis in Parts II.C, II.E, and II.H), and thus the
commenter's hypothesized effects on State welfare benefits and social
services are unlikely to materialize.
Moreover, it is not clear that any of the costs cited in the
comments would qualify as ``direct'' under Executive Order 13132. The
express terms of this final rule do not require State or local
governments to pay any costs to comply. Rather, the comments pointed to
indirect costs from theoretical alleged consequences of this final
rule. Consequently, although Executive Order 13132 does not create any
privately enforceable rights, the Agencies conclude that this final
rule does not violate provisions in that Executive Order.
Changes: None.
Affected Regulations: None.
5. Unfunded Mandates Reform Act
Summary of Comments: Some commenters asserted that the Agencies
incorrectly claimed an exemption from the requirement, in the Unfunded
Mandates Reform Act of 1995 (``UMRA''), to assess a proposal's costs
and benefits for States and local governments and the private sector,
arguing that Trinity Lutheran and RFRA do not enforce statutory rights
prohibiting discrimination. Some of these commenters added that Trinity
Lutheran does not meet this standard because it is merely case law and
that RFRA does not meet this standard because it permits individuals to
seek relief from burdens on religious exercise but does not establish a
categorical right against religious discrimination. One commenter urged
multiple Agencies to conduct an UMRA analysis before issuing a final
rule.
Response: Section 4 of UMRA, 2 U.S.C. 1503(1)-(2), excludes from
coverage under that Act any proposed or final Federal regulation that
``enforces constitutional rights'' or ``establishes or enforces any
statutory rights that prohibit discrimination on the basis of race,
color, religion, sex, national origin, age, handicap, or disability.''
The provisions of the proposed rule, and of this final rule, are
designed in substantial part to maintain a full protection of the
constitutional and statutory rights to be free from discrimination on
the basis of religion--set forth in the First Amendment to the U.S.
Constitution, and numerous other statutes, including 42 U.S.C. 2000bb
et seq., 42 U.S.C. 18113, 42 U.S.C. 2000e-1(a) and 2000e-2(e), and 42
U.S.C. 12113(d). For example, the core protection of this rule, which
has been in place since 2004, is that Agencies may not discriminate for
or against an organization on the basis of its religious character or
affiliation. The Supreme Court has since confirmed, in its 2017
decision in Trinity Lutheran and its 2020 decision in Espinoza, that
this nondiscrimination right is grounded in the Free Exercise Clause.
The clarifications that the Agencies provide to protect organizations
from certain forms of discrimination on the basis of ``religious
exercise'' are designed to give full effect to this protection and to
the protections of RFRA that, as the Supreme Court has made clear in
its 2014 decision in Hobby Lobby and in its 2020 decision in Little
Sisters, extend to organizations as well as individuals. And the
clarifications that certain of the Agencies have provided regarding the
scope of the Title VII exemption is designed to enforce that statute.
Furthermore, this final rule does not impose any Federal mandate
that will result in the expenditure of funds by State, local, or tribal
governments, in the aggregate, or by the private sector, of $100
million or more in any one year. Most, if not all, expenditures by such
governments--for example, as primary recipients of Federal financial
assistance--will be directly funded by the Federal program and will be
mandated by the underlying program, not this final rule.
For the foregoing reasons, the Agencies disagree that they are
required to take any action under the provisions of UMRA.
Changes: None.
Affected Regulations: None.
III. Agency-Specific Preambles
A. Department of Education 78
---------------------------------------------------------------------------
\78\ The remainder of the proposed provisions in the Department
of Education's NPRM, including proposed changes to 34 CFR 75.500, 34
CFR 75.700, 34 CFR 76.500, 34 CFR 76.700, 34 CFR 106.12(c), 34 CFR
606.10, 34 CFR 607.10, 34 CFR 608.10, and 34 CFR 609.10 as well as
the addition of a severability clause in 34 CFR 75.684, 34 CFR
75.741, 34 CFR 76.684, 34 CFR 76.784, 34 CFR 606.11, 34 CFR 607.11,
34 CFR 608.12, 34 CFR 609.12, already have been promulgated through
a different rulemaking. Office of Postsecondary Education, U.S.
Department of Education, Direct Grant Programs, State-Administered
Formula Grant Programs, Non-Discrimination on the Basis of Sex in
Education Programs or Activities Receiving Federal Financial
Assistance, Developing Hispanic-Serving Institutions Program,
Strengthening Institutions Program, Strengthening Historically Black
Colleges and Universities Program, and Strengthening Historically
Black Graduate Institutions Program, 85 FR 59,916-82 (Sept. 23,
2020) (``Religious Liberty and Free Inquiry Final Rule''). To the
extent that any comments such as comments about the length of the
public comment period and requests for extension of the public
comment period included in the Religious Liberty and Free Inquiry
Final Rule concern the regulations in this final rule, the
Department of Education refers to those comments and its responses
to those comments in the Religious Liberty and Free Inquiry Final
Rule. Id.
---------------------------------------------------------------------------
1. Comments in Support
Summary of Comments: Commenters noted that the proposed rule would
reinforce Americans' religious liberties and the rule of law. Some
commenters argued that the proposed rule appropriately eliminates
potentially unequal treatment of religious institutions when applying
for Department grants and restores fairness.
One commenter emphasized that First Amendment religious freedom
rights for faith-based institutions and for students are essential to
the operation and success of America's rich and diverse educational
system. This commenter also asserted that faith-based organizations and
faith-based schools may offer meaningful services to those in need.
Another commenter acknowledged that some may believe the proposed
rule would have the effect of permitting schools to discriminate
against the LGBTQ community, women, and pregnant students. However,
this commenter emphasized that to categorically prohibit Federal
funding to religiously affiliated organizations and schools would
unfairly marginalize them. The commenter suggested that such
organizations and schools can effectively serve marginalized groups.
Response: The Department appreciates the comments in support of the
proposed rule. We agree that the proposed rule would appropriately
protect religious liberty and prevent discrimination against faith-
based
[[Page 82109]]
organizations. Furthermore, we acknowledge that faith-based
organizations and schools make meaningful contributions to the richness
and diversity of our Nation's educational system. And such entities
also provide critical services to vulnerable populations and those in
need.
We wish to emphasize that it is certainly not the intent of the
Department to encourage discrimination, including against the LGBTQ
community, women, or pregnant students, and we do not believe that
these final regulations do so. Grantees provide secular services to all
persons and are precluded from discriminating against beneficiaries on
the basis of religion or religious belief, a refusal to hold a
religious belief, or refusal to attend or participate in a religious
practice.\79\ We also agree with the commenter that faith-based
organizations may effectively serve diverse groups of people, including
marginalized groups. As one commenter correctly observed, the proposed
rule was aimed at redressing the unfair treatment of faith-based
organizations. In short, the final rule will have the effect of
leveling the playing field such that faith-based organizations and
religious individuals would not be treated any differently than other
organizations or individuals.
---------------------------------------------------------------------------
\79\ 2 CFR 3474.15(f); 34 CFR 75.52(e); 34 CFR 76.52(e).
---------------------------------------------------------------------------
Changes: None.
Affected Regulations: None.
2. Comments in Opposition
a. Concerns Regarding Discrimination and Impact on Programs
Summary of Comments: Many commenters expressed concern that the
proposed rule would unfairly eliminate religious freedom protections in
college preparatory and work-study programs intended to help low-income
high school students prepare for college. One commenter clarified a
concern that the proposed rule would eliminate religious freedom
protections for non-religious participants in those programs.
Commenters also warned that the proposed rule may negatively impact
federally funded afterschool and summer learning programs for students
in high-poverty and low-performing schools. Some commenters argued that
the proposed rule would undermine access to critical services for youth
such as school lunch programs, 4-H development, youth mentoring
programs, youth career development, and employment opportunity
programs.
Commenters asserted that, in America, no individual's ability to
receive an education should depend on whether he or she shares the
religious beliefs of government-funded organizations.
Several commenters believed the proposed rule would result in
unfair discrimination and expressed a concern that the separation of
church and state would be undermined by the proposed rule.
One commenter, a veteran, wrote that he completed a Department-
funded program called Veteran's Upward Bound to complete his GED and
college preparation. This commenter noted that, with the services he
received that were delivered without regard for religion or involving
religious organizations, including the ``old G.I. bill'' and Pell
grants, he was able to earn his undergraduate and graduate degrees. The
commenter asserted that, had these programs engaged in discrimination,
then he may not have been able to continue his education.
One commenter stated that, under the proposed rule, an unmarried
pregnant student might be refused services by a government-funded
social service agency partnering with a public school to provide
healthcare screening, transportation, or other services. Similarly,
another commenter believed that under the proposed rule an LGBTQ
student or child of LGBTQ parents could be confronted with open anti-
LGBTQ hostility by a Department-funded social service program
partnering with their public school to provide important services such
as healthcare screening, transportation, shelter, clothing, or new
immigrant services.
One commenter argued that a fundamental responsibility of the
Department is to provide equal access to all people and freedom from
discrimination. This commenter suggested that no taxpayer money go to
schools that discriminate, including those that discriminate out of
sincerely held religious beliefs.
Another commenter stated that the proposed rule would allow
providers to discriminate on the basis of religion. For example, this
commenter claimed a Jewish or Muslim student might be turned away from
a 21st Century Community Learning Center but may not be aware of
alternative providers.
Response: The Department disagrees with commenters who suggest that
the rule will eliminate religious freedom protections for non-religious
participants in college preparatory and work-study programs intended to
help low-income high school students. The regulation expressly
prohibits all organizations (including faith-based organizations who
are grantees or who contract with grantees or subgrantees) from
discriminating against beneficiaries on the basis of religion or
religious belief, a refusal to hold a religious belief, or a refusal to
attend or participate in a religious practice.\80\ Neither will the new
regulations allow providers administering the Veteran's Upward Bound
program to discriminate against beneficiaries based on religion; such
discrimination would violate the conditions of the organization's
Federal grant. Further, under the proposed rules, any faith-based
organization that provides such social services must offer its
religious activities separately in time or location from any programs
or services funded by the Department, and any attendance or
participation in such explicitly religious activities by beneficiaries
supported by the programs must be voluntary.\81\
---------------------------------------------------------------------------
\80\ 2 CFR 3474.15(f); 34 CFR 75.52(e); 34 CFR 76.52(e).
\81\ 2 CFR 3474.15(d)(1); 2 CFR 75.52(c)(1); 2 CFR 76.52(c)(1).
---------------------------------------------------------------------------
The Department notes that commenters arguing that the new
regulations will have a detrimental impact on critical youth services
do not explain how the new regulations will harm school lunch programs,
4-H development, youth mentoring programs, youth career development,
employment opportunity programs, after school programs, and summer
learning programs. To the contrary, these regulations provide stringent
religious liberty protections for their beneficiaries. Indeed, as
previously discussed, providers may not discriminate against
beneficiaries on the basis of religion, and their federally funded
services may not contain religious programming or activities.
The Department emphasizes that the final regulations' restriction
against discriminating on the basis of religion or religious belief
applies equally to faith-based organizations and secular organizations.
Thus, no individual's ability to receive an education depends on
whether they share the religious beliefs of the Government-funded
organization, and access to government services is broadened, not
undermined. On the other hand, to deny Federal funding to faith-based
organizations because they hold sincerely held religious beliefs is
unconstitutional under the Supreme Court's decision in Trinity Lutheran
Church of Columbia, Inc. v. Comer.\82\ A beneficiary will never
[[Page 82110]]
be required to attend a religious activity in direct aid programs, and
a beneficiary through a genuine, independent choice may use a voucher,
certificate, or other means of government-funded payment, which is
considered ``Indirect Federal financial assistance,'' for a private
organization that may require attendance or participation in a
religious activity.\83\ This latter result would only happen because of
the independent choice of the beneficiary, not coercion or pressure
from the Department.
---------------------------------------------------------------------------
\82\ 137 S. Ct. 2012, 2019 (2017) (internal quotation marks
omitted) (``denying a generally available benefit solely on account
of religious identity imposes a penalty on the free exercise of
religion that can be justified only by a state interest of the
highest order.'').
\83\ See 34 CFR 75.52(c)(3)(ii) and 34 CFR 76.52(c)(3)(ii).
---------------------------------------------------------------------------
The Department notes that a government-funded social service agency
partnering with a public school may not refuse services to an unmarried
pregnant student. In fact, such a student at a public school receives
express protections under Title IX.\84\ The changes under the new
regulations will not impact any student seeking social services from a
social service agency partnering with a public school. Under the new
regulations, a private organization that contracts with a grantee or
subgrantee, including a State, may not discriminate against any student
on the basis of religion or religious belief.\85\
---------------------------------------------------------------------------
\84\ See, e.g., 34 CFR 106.21(c); 34 CFR 106.40; 34 CFR 106.51;
34 CFR 106.57.
\85\ 2 CFR 3474.15(f); 34 CFR 75.52(e); 34 CFR 76.52(e).
---------------------------------------------------------------------------
The Department reiterates that, under the new regulations, no
providers receiving Federal funds may discriminate on the basis of
religion. A federally funded learning center that turns away a Jewish
or Muslim student because of his or her sincerely held religious
beliefs, as described in the commenter's hypothetical, would be in
violation of a material condition of its grant and risks consequences
as a result of such a material breach.\86\
---------------------------------------------------------------------------
\86\ Id.
---------------------------------------------------------------------------
Lastly, no wall of separation between church and state is offended
by the new regulations. Rather, preventing faith-based institutions
from receiving grant money based on their religious nature would
violate the Constitution, as discussed elsewhere in this preamble and
in the preamble of the Department's NPRM.\87\ The Supreme Court has
explained that the Constitution does not ``require complete separation
of church and state; it affirmatively mandates accommodation, not
merely tolerance, of all religions, and forbids hostility toward any.''
\88\ Indeed, this ``metaphor has served as a reminder that the
Establishment Clause forbids an established church or anything
approaching it.'' \89\ The Department is not making any revisions to 34
CFR 75.532 and 34 CFR 76.532, which prohibit the use of a grant to pay
for religious worship, religious instruction, or proselytization, and
also prohibit the use of a grant to pay for any equipment or supplies
to be used for such activities. The new regulations do not establish a
church or anything approaching it; instead, they require faith-based
institutions to keep their religious activities separate from any
federally funded programs and mandate equal treatment of faith-based
and secular institutions.
---------------------------------------------------------------------------
\87\ 85 FR 3190, 3191-96, 3200-10.
\88\ Lynch v. Donnelly, 465 U.S. 668, 673 (1984).
\89\ Id.
---------------------------------------------------------------------------
Changes: None.
Affected Regulations: None.
b. Concerns Regarding Appropriate Use of Taxpayer Dollars
Summary of Comments: One commenter asserted that Department grant
programs should be implemented no differently than Federal funding for
other industries under contracts that require non-discriminatory
practices as a condition of receiving those funds.
Several commenters expressed opposition to the idea of using
taxpayer funds to support religious or private schools, such as through
school vouchers. Commenters believed that taxpayer money should only go
to public schools. One commenter asserted that funding for public
schools should increase so public school teachers earn incomes
comparable with faculty at institutions of higher education.
The commenter also believed that all schools providing accredited
degrees or diplomas should be required to follow a base curriculum of
non-negotiable lessons provided by the Department. Another commenter
expressed opposition to taxpayer dollars going to charter schools and
argued that charter schools are often intertwined with the religious
community and tend to prioritize religious dogma in their instruction
over scientific evidence.
Response: The Department responds that its grant programs already
require adherence to principles of nondiscrimination, subject to
exemptions rooted in countervailing constitutional considerations.
Indeed, several provisions of the new regulations condition the award
of Federal funds on public institutions not engaging in discrimination.
For example, faith-based organizations are eligible to contract with
grantees and subgrantees, including States, on the same basis as any
other private organization, with respect to contracts for which such
other organizations are eligible, and considering any permissible
accommodation.\90\ And, as discussed at length previously, all
organizations--public, charter, private, and/or faith-based--are
required to refrain from discrimination on the basis of religion in
offering social services. These provisions are intended to prevent
institutions that receive Federal funds from engaging in
discrimination. This also means that the Department may lawfully
provide Federal funds to charter schools, regardless of these
organizations' ties to the religious community, on the condition that
those schools do not use the funds for explicitly religious
purposes.\91\
---------------------------------------------------------------------------
\90\ 2 CFR 3474.15(b).
\91\ See, e.g., 34 CFR 75.532; 34 CFR 76.532.
---------------------------------------------------------------------------
The Department reiterates that denying religious schools public
benefits afforded to public schools because of their religious status,
as one commenter suggested, is a violation of the Free Exercise Clause
and Supreme Court precedent in Trinity Lutheran.\92\ With respect to
vouchers, the Supreme Court has supported their application to
religious institutions, reasoning that ``where a government aid program
is neutral with respect to religion, and provides assistance directly
to a broad class of citizens who, in turn, direct government aid to
religious schools wholly as a result of their own genuine and
independent private choice, the program is not readily subject to
challenge under the Establishment Clause.'' \93\
---------------------------------------------------------------------------
\92\ 137 S. Ct. 2021-25.
\93\ Zelman v. Simmons-Harris, 536 U.S. 639, 652 (2002).
---------------------------------------------------------------------------
The Department further responds that it is not within the authority
of the Department to establish a national curriculum or regulate
teacher incomes. Indeed, in creating the Department of Education,
Congress specified that:
No provision of a program administered by the Secretary or by
any other officer of the Department shall be construed to authorize
the Secretary or any such officer to exercise any direction,
supervision, or control over the curriculum, program of instruction,
administration, or personnel of any educational institution, school,
or school system, over any accrediting agency or association, or
over the selection or content of library resources, textbooks, or
other instructional materials by any educational institution or
school system, except to the extent authorized by law.\94\
---------------------------------------------------------------------------
\94\ Public Law 96-88, sec. 103(b), 93 Stat. 668, 670-71 (1979).
[[Page 82111]]
---------------------------------------------------------------------------
Curricula and setting teacher salaries are responsibilities handled by
the various States and districts as well as by public and private
organizations of all kinds, not by the Department.
Changes: None.
Affected Regulations: None.
c. Concerns Regarding Potential for Religious Compulsion
Summary of Comments: One commenter expressed concern that, under
the proposed rule, a low-income student participating in an Upward
Bound program may be forced to accept services from a faith-based
service provider that repeatedly invites them to participate in
additional religious activities. This commenter noted the student may
find such pressure uncomfortable but would not know that they can
access an alternative provider nor how to find one.
Another commenter asserted that, under the proposed rule, an LGBTQ
student participating in an Upward Bound college preparation program
may be forced to select a faith-based provider who forces the student
to participate in religious programming that may be hostile to the
LGBTQ community. And one commenter expressed concern that the proposed
rule would undermine important safeguards for beneficiaries of voucher
programs and explicitly allow service providers to require individuals
in voucher programs to participate in religious activities. The
commenter explained that religious minorities who have to use a voucher
to obtain services and have no available secular option to choose from
may effectively be coerced into participating in religious activities.
For example, a Hindu American who is forced to utilize a voucher for a
religious school may be forced into taking part in Christian religious
services and face pressure to compromise or hide his own religious
beliefs. The commenter concluded that a voucher program that offers no
genuine and independent private choices that are secular would violate
basic constitutional protections against the establishment of religion
and the Government funding of religious programs.
Response: The Department clarifies that Upward Bound programming is
prohibited from containing religious content or religious activities,
even if the Upward Bound programming is provided by a faith-based
provider. Indeed, faith-based providers are required to hold their
religious activities separately in time or location from activities or
services associated with the Upward Bound project, and the providers
may not force or pressure beneficiaries to participate in these
religious activities. The secular content of Upward Bound programming,
which does not include religious programming or activities of any kind,
is codified at 34 CFR 645.11
It is possible that a faith-based organization may be the only
servicer providing an Upward Bound program to a geographic region of
beneficiaries, but this faith-based organization would be providing
only secular content. Moreover, the Department has received no
complaints regarding a situation in which this has occurred. In any
event, as discussed, that faith-based provider is required to keep its
Upward Bound programming independent from its religious activities, is
prohibited from pressuring students to engage in religious programming,
and must also refrain from discriminating against any beneficiaries on
the basis of religion or religious belief. Additionally, a beneficiary
may research available providers and make an informed decision about
whether to choose to receive social services from a secular or faith-
based organization.
With respect to vouchers, which are a form of indirect Federal
financial assistance, the Department has received no complaints about
any voucher programs in which there are no secular alternatives, nor
did the commenter who expressed concern about this refer to any
existing voucher program in which this is presently occurring. The
Department reiterates that it cannot force beneficiaries to engage in
religious activities or coerce beneficiaries to choose the services of
a faith-based organization, nor do these final regulations do so.
Changes: None.
Affected Regulations: None.
d. Concerns Regarding Modifications
Summary of Comments: One commenter requested that the Department
amend 2 CFR 3474.15(a) such that ``contractors'' would replace
``subgrantees.'' This commenter believed that, despite clearly
established law, public institutions of higher education continue to
violate the First Amendment rights of students and professors, and
often by targeting minority viewpoints for discriminatory treatment.
The commenter did not further clarify why this change should be made.
Another commenter expressed a general concern that the proposed rule
may not go far enough to protect the deferment of loan payments when a
former student is engaged in religious activities with a nonprofit
religious organization.
Response: The commenter who suggested that 2 CFR 3474.15(a) be
amended to reinforce First Amendment rights may have misunderstood the
proposed rules. The provisions of the proposed rules that relate to the
First Amendment and free inquiry matters are contained in Sec. Sec.
75.500, 75.700, 76.500, and 76.700 of title 34 of the Code of Federal
Regulations, which were promulgated through a different rulemaking. It
is unclear how amending the proposed rule's language as suggested by
the commenter would affect free speech rights. Changing ``subgrantees''
to ``contractors'' would not affect the entity that must comply with 2
CFR 3474.15(a). The Department also wishes to clarify that loan
deferment is outside the scope of the proposed rule. Indeed, the
Department specifically addressed the loan deferment matters that the
commenter raised in a separate rulemaking.\95\
---------------------------------------------------------------------------
\95\ Office of Postsecondary Education, U.S. Department of
Education, Notice of Proposed Rulemaking, 84 FR 67778 (Dec. 11,
2019).
---------------------------------------------------------------------------
Changes: None.
Affected Regulations: None.
e. Severability Clauses
Summary of Comments: None.
Response: The Department proposed adding severability clauses in 2
CFR 3474.21, 34 CFR 75.63, 34 CFR 76.53, 34 CFR 75.741, and 34 CFR
76.784, in the NPRM.\96\ We believe that each of the regulations
discussed in this final rule would serve one or more important and
related but distinct purposes. Each provision would provide a distinct
value to the Department, grantees, subgrantees, recipients, students,
beneficiaries, the public, taxpayers, the Federal Government, and
institutions of higher education separate from, and in addition to, the
value provided by the other provisions. To best serve these purposes,
we included this administrative provision in the final regulations to
make clear that the regulations are designed to operate independently
of each other and to convey the Department's intent that the potential
invalidity of one provision should not affect the remainder of the
provisions. Similarly, the validity of any of the regulations, which
were proposed in ``Part 1--Religious Liberty'' of the NPRM, should not
affect the validity of any of the regulations, which were proposed in
``Part 2--Free Inquiry'' of the NPRM.
---------------------------------------------------------------------------
\96\ 85 FR 3201, 3204, 3205.
---------------------------------------------------------------------------
As the Department already promulgated the severability clauses in
34 CFR 76.784 and 34 CFR 75.741 through a different rulemaking that
also finalizes the remainder of the regulations proposed in the NPRM,
the
[[Page 82112]]
Department does not include those severability clauses in this
rulemaking. Nonetheless, those severability clauses apply to the
relevant final regulations in this rulemaking.
Changes: None.
Affected Regulations: None.
B. Department of Homeland Security
DHS did not identify any comments or issues unique to the
Department; accordingly, DHS is making no further changes to its
regulations beyond those explained above.
C. Department of Agriculture
USDA did not identify any comments or issues unique to the
Department; accordingly, USDA is making no further changes to its
regulations beyond those explained above.
D. Agency for International Development
USAID received a total of 28,518 comments on its January 17, 2020
NPRM, and did not consider any comments received after that comment end
date of February 18, 2020. Of the comments received, 28,044 were
identical or nearly identical to other comments received, leaving 474
comments that were unique or representative of a group of substantially
similar comments. In addition, many of those comments were identical to
comments provided to the other Agencies and addressed above in the
Joint Preamble, and most of these cross-cutting comments did not
directly apply, or did not apply in the same way, to USAID. Some of
those cross-cutting comments included additional remarks or references
specific to USAID's proposed rule.
As reflected below, unless otherwise specified, for those comments
received by USAID that are addressed fully in the Joint Preamble, USAID
adopts those responses to the extent applicable to USAID's regulations.
We address in this Part III.D of the preamble the USAID-specific
comments not addressed elsewhere in the preamble and provide the USAID-
specific findings and certifications.
Some of the cross-cutting comments addressed in the Joint Preamble
were not received by USAID, but are nevertheless applicable to the
USAID regulations. Unless noted either in the Joint Preamble or this
agency-specific Part III.D, we concur in the resolution of the issues
in that part of the preamble.
1. Notice and Alternative Provider Requirements
USAID does not adopt the discussion of the cross-cutting comments
related to the notice and alternative provider requirements in Part
II.C. Instead, USAID addresses the comments it received on that topic
in the following discussion.
Summary of Comments: USAID received comments both criticizing and
supporting the elimination of provisions (a) requiring service
providers to provide written notice of beneficiary protections, and (b)
requiring referrals to alternative providers for beneficiaries who
object to the religious character of a service provider. USAID did not
receive any comments on these issues that were different from or more
specific than the applicable cross-cutting comments that are summarized
in Section 3 of this preamble.
Response: Unlike various domestic agencies, USAID never adopted
notice and alternative provider requirements in response to Executive
Order 13559. The reasons for this, many of which relate to the
international context in which USAID operates, are detailed in the 2016
joint final rule (81 FR 19,355). Accordingly, the comments regarding
the elimination of those requirements are not applicable to USAID.
Changes: None.
Affected Regulations: None.
2. ``Religious Organizations'' to ``Faith-Based Organizations''
Summary of Comments: USAID received comments about its change of
the term ``Religious Organizations'' in certain instances to ``Faith-
Based Organizations,'' expressing concern that the change could result
in a broader pool of organizations that are eligible to participate in
USAID programs, or that may be entitled to the exemptions and
protections listed in the rule.
Response: USAID makes the regulatory changes noted below to make
the terminology in its regulation consistent with that in Executive
Order 13831. Because USAID does not recognize a qualitative difference
between the terms, USAID does not believe that choosing one term over
the other will change the pool of organizations that are eligible to
participate in USAID programs, or that may be entitled to the
exemptions and protections listed in the rule.
Changes: Revise 22 CFR 205.1(a), (c), and (f) to replace the term
``religious organizations'' with ``faith-based organizations.''
Affected Regulations: 22 CFR 205.1(a), (c), and (f).
3. Reasonable Accommodations
Summary of Comments: USAID did not receive any comments on the
issue of reasonable accommodations that were different from or more
specific than the applicable cross-cutting comments that are summarized
in Part II.E.
Response: USAID makes the regulatory changes noted below,
consistent with the explanation provided in the applicable cross-
cutting comments that are summarized in Part II.E.
Changes: Revise 22 CFR 205.1(a) to clarify the text by stating
explicitly the applicability of the First Amendment and the Religious
Freedom Restoration Act, under which accommodations for faith-based
organizations could be available.
Affected Regulations: 22 CFR 205.1(a).
4. Religious Character and Religious Exercise
Summary of Comments: USAID did not receive any comments regarding
the change from ``religious character'' to ``religious exercise'' that
were different from or more specific than the applicable cross-cutting
comments that are summarized in Part II.F.
Response: USAID makes the regulatory changes noted below,
consistent with the explanation provided in the applicable cross-
cutting comments that are summarized in Part II.F.
Changes: Revise 22 CFR 205.1(a) and (f) to note that USAID and/or
USAID grantees will not discriminate against potential service
providers on the basis of their ``religious exercise'', rather than
their ``religious character,'' as previously stated.
Affected Regulations: 22 CFR 205.1(a) and (f).
5. Exemption From Title VII Prohibitions for Qualifying Organizations
Hiring Based on Acceptance of, or Adherence to, Religious Tenets
Summary of Comments: USAID did not receive any comments regarding
the religious employment exemption that were different from or more
specific than the applicable cross-cutting comments that are summarized
in Part II.H.
Response: USAID makes the regulatory changes noted below,
consistent with the explanation provided in the applicable cross-
cutting comments that are summarized in Part II.H.
Changes: Revise 22 CFR 205.1(g) to state that an organization that
qualifies for an exemption from discriminatory hiring practices based
on religion may select its employees on the basis of their acceptance
of, and/or adherence to, the religious tenets of the organization.
Affected Regulations: 22 CFR 205.1(g).
[[Page 82113]]
6. Assurances From Religious Organizations With Sincerely Held
Religious Beliefs
Summary of Comments: One commenter proposed that religious
organizations partnering with USAID that take anti-LGBTI stances should
be required to provide assurances that they will provide services
without prejudice and do so in conditions that respect the privacy and
dignity of all individuals. The commenter expressed that this proposed
action is necessary because of a heightened potential for religious
organizations to discriminate against potential LGBTI beneficiaries,
caused by the inclusion of language regarding ``reasonable
accommodation'' and the change in certain instances of the term
``religious character'' to ``religious exercise.''
Response: Regarding the assertion that the addition of the phrase
``reasonable accommodation'' and the substitutions of certain instances
of the term ``religious character'' with ``religious exercise'' could
allow religious organizations to discriminate against any
beneficiaries, USAID adopts the explanation provided in Parts II.E and
II.F in response to the cross-cutting comments of this nature.
Regarding the proposal to require certain assurances from religious
organizations, USAID notes that, consistent with the First Amendment
and the Religious Freedom Restoration Act, USAID's rule emphasizes that
notices and assurances shall not be required by faith-based
organizations if they are not also required of secular organizations.
Accordingly, any proposed assurances could not be limited to faith-
based organizations. Nor does the concern raised--the impact of
sincerely held religious beliefs on an organization's ability to serve
beneficiaries--appear to be one that is necessarily specific to
religious organizations. Therefore, USAID does not view this rule as
the appropriate vehicle through which to address the proposal.
USAID is committed to ensuring that all beneficiaries have
equitable access to the benefits of development assistance. USAID's
rule requires that all organizations that participate in USAID programs
must carry out eligible activities in accordance with all program
requirements and other applicable requirements that govern the conduct
of USAID-funded activities. Agency policy further requires that grant
recipients not discriminate against any beneficiaries in the
implementation of their awards, including on the basis of sex. These
requirements are included as standard provisions in all of USAID's
grants to NGOs, and must be flowed down to any sub-recipients.
Changes: None.
Affected Regulations: None.
7. Findings and Certifications
a. 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 regulations. USAID certifies that the regulations will
not have a significant economic impact on a substantial number of small
entities.
b. Paperwork Burden
These regulations do not impose any new recordkeeping requirements,
nor do they change or modify an existing information collection
activity. Thus, the Paperwork Reduction Act does not apply to these
final regulations.
E. Department of Housing and Urban Development
1. Other Conflicting Laws
Summary of Comments: One commenter stated that the proposed rule's
removal of the written notice-and-referral requirements conflicts with
HUD's obligation to comply with the Fair Housing Act by prohibiting
discrimination in sale, rental, or financing housing based on race,
color, religion, sex, disability, familial status, or national origin.
The commenter also stated that the references to definitions of
``religious exercise'' and ``indirect Federal financial assistance''
violate the Fair Housing Act and go beyond Congressional Authority
without explanation, statutory basis, or compelling reason.
Another commenter stated the proposed rule suggests that religious
accommodations could be made that would exempt faith-based
organizations from generally applicable laws and regulations
prohibiting discrimination, including the Fair Housing Act of 1968 and
its regulations. The commenter stated that the proposed rule completely
dismantles the protections in the Fair Housing Act and the 2012 and
2016 Equal Access Rules that currently protect LGBTQ individuals. It
would be discriminatory and harmful to allow programs to opt out of
these provisions based on the religious beliefs of the housing or
homeless services provider. For example, the 2012 Equal Access Rule
defines a family regardless of gender identity or sexual orientation of
the family members. A religious exemption from this definition of
family by a provider who objects to same-sex marriage would result in
otherwise impermissible discrimination.
Response: HUD does not agree that this rule conflicts with the Fair
Housing Act. Removing the written notice requirement does not affect an
individual's ability to file a complaint with HUD under the Fair
Housing Act, nor will it affect HUD's administration of such
complaints. A complaint of discrimination based on religion or any
other protected characteristic may be investigated and enforced under
the Fair Housing Act. Complaints can be filed online through HUD's
Office of Fair Housing and Equal Opportunity (``FHEO'').\97\ HUD also
disagrees that references to definitions of ``religious exercise'' and
``indirect Federal financial assistance'' violate the Fair Housing Act.
These references ensure that HUD's programs and activities are
consistent with the First Amendment to the Constitution and the
requirements of Federal law, including the Religious Freedom
Restoration Act.
---------------------------------------------------------------------------
\97\ U.S. Department of Housing and Urban Development, File a
Complaint, https://www.hud.gov/program_offices/fair_housing_equal_opp/online-complaint. Additionally, FHEO intake
specialists can be reached by calling 800-669-9777 or 800-877-8339.
---------------------------------------------------------------------------
More specifically, the rule is designed to treat religious
organizations the same as non-religious organizations by subjecting all
organizations to the same requirements. As made clear in the proposed
rule, HUD will not, in the selection of recipients, discriminate
against an organization based on the organization's religious exercise
or affiliation. Furthermore, religious freedom protections make clear
that a faith-based organization retains its independence from the
Government and may continue to carry out its mission even when it
participates in a Federal program, including a HUD program.
Nevertheless, alleged cases of discrimination, including discrimination
on the basis of ``sex,'' are evaluated based on current law and court
interpretation and discrimination on the basis of gender identity or
sexual orientation would be evaluated under HUD's program specific
requirements.
Changes: None.
Affected Regulations: None.
2. Conflicting Agency Programs and Policies
Summary of Comments: One commenter stated the proposed rule would
be contrary to HUD's mission of ``ensuring access to housing for all
Americans.'' Another commenter also said HUD should not be responsible
for upholding this executive order as it is outside the scope of HUD's
programs.
[[Page 82114]]
The commenter stated that this program will in no way be of any use to
HUD and should not be implemented because it is not providing any type
of relief or assistance and that if there are disputes over religious
bias, it should be taken up with the courts, not dictated by a US
Federal department that does not normally deal with religion.
Commenters also stated that HUD money should not be funding
religion because it is not HUD's purpose, nor does it have to do with
HUD's activities, while another commenter said they were opposed to
religious interference in the implementation of HUD procedures. Some
commenters said HUD social services programs affected by the Proposed
Rule would include, but not be limited to, housing counseling grants,
continuum of care programs, supportive housing for the elderly and
persons with disabilities, emergency shelters, CDBG, and housing
opportunities for persons with HIV (HOPWA), and the proposed rule runs
counter to these programs' intended purpose by increasing the
likelihood of inefficiencies, exposing beneficiaries to potential
harms, and hindering access to vital government services.
According to one commenter, the Proposed Rule is wholly
inconsistent with HUD's core mission and preventing discrimination
because it authorizes faith-based organizations to obtain religious
accommodations that could lead to such federally funded providers
discriminating against, or electing not to assist, LGBTQ individuals--
or other individuals with whom they might disagree--based on asserted
religious grounds.
Response: HUD believes that this rule is consistent with HUD's
mission to ensure housing for all Americans. As stated in this
preamble, the purpose of the rule is to treat religious organizations
equally with non-religious organizations by subjecting all
organizations to the same requirements. HUD believes that in doing so,
it is further strengthening its mission by ensuring that religious
organizations can participate in HUD's program. This rule guarantees
that these organizations will maintain their liberty protections found
in the Constitution and Federal law and eliminate the fear that they
will compromise their sincerely held religious beliefs or will lose
their independence.
Furthermore, HUD does not agree that allowing religious
organizations to maintain their independence as dictated by the
Constitution and Federal statutes amounts to funding religion, nor does
HUD believe that religious organizations participating in a HUD program
or religious organizations receiving Federal funds for non-religious
activities amounts to HUD adopting, supporting, or otherwise promoting
the religious beliefs of the participating organization.
The purpose of the proposed rule is to ensure that HUD's programs
and activities are consistent with the First Amendment to the
Constitution and the requirements of Federal law, including the
Religious Freedom Restoration Act. In order for HUD's programs and
activities to be consistent, HUD will not, in the selection of
recipients, discriminate against an organization based on the
organization's religious exercise or affiliation. HUD does not believe
this rule will interfere with the implementation of HUD programs nor
will it increase inefficiencies, create potential harms, or create a
hinderance to access HUD programs as suggested by the commenter. The
rule will actually provide more opportunities for participation by
faith-based organizations, provide religious organizations the ability
to participate on equal footing with other organizations, and will
allow more participation and therefore greater availability of
services.
Moreover, the rule does not affect an individual's ability to file
a complaint with HUD alleging discrimination under the Fair Housing
Act, nor will it affect HUD's administration of such complaint. Cases
of discrimination are evaluated based on current law and court
interpretation. Therefore, HUD believes that it is appropriate to issue
regulations that guarantee religious protections across HUD's programs.
Changes: None.
Affected Regulations: None.
3. Procedural Issues
a. Comment Period
Summary of Comments: Some commenters requested the comment period
on this proposed rule be extended beyond the COVID-19 emergency prior
to any effort to proceed with this proposed rule. Commenters wrote to
Secretary Carson to request that all rulemakings unrelated to response
to the COVID19 emergency or other critical health, safety, and security
matters be halted. Halting such rulemakings will permit HUD staff to
focus on America's response to the coronavirus's health and economic
effects. Doing so also would permit the public adequate time to provide
meaningful comments on proposals that effect important functions of our
government. Interested organizations and individual members of the
public should not be deprived of the opportunity to comment on these
matters as they struggle to cope with the effects of a pandemic on our
society.
Response: HUD's Federal rulemaking policies and procedures are
described in 24 CFR part 10. According to the regulation, it is HUD's
policy that its notices of proposed rulemaking generally afford the
public not less than 60 days for submission of comments (24 CFR 10.1).
These notice and comment procedures, including the time period, are
consistent with Executive Order 12866, and the APA (5 U.S.C. 553).
Pursuant to these policies, HUD published a notice on February 13,
2020, ``Equal Participation of Faith-Based Organizations in HUD
Programs and Activities: Implementation of Executive Order 13831'' (FR-
6130-P-01). That notice provided for 60 days of public comment, which
ended on April 13, 2020. HUD received over 2,495 comments in response
to the proposed rule. HUD's provision of 60 days for submission of
comments is adequate. HUD notes that public comments can be, and
usually are, submitted electronically at www.regulations.gov. In view
of the comment period beginning 30 days before the President's March
13, 2020 Declaration of a National Emergency and the public's continued
ability to comment electronically, HUD determined that the public had
adequate time to comment.
Changes: None.
Affected Regulations: None.
b. Rulemaking Authority
Summary of Comments: Commenters stated that the language ``in the
event of any conflict, will control over any HUD guidance document''
should not be adopted because it is an indication that HUD is
overreaching and attempting to act beyond its authority. The commenters
also stated that the language ``intended to be consistent with E.O.
13891, Oct. 9, 2019, which provides guidance documents lack force of
law, except as authorized by law or as incorporated into a contract''
should not be adopted because it is government overreach without
explanation of how the change relates to HUD's congressional purpose or
any statutory objective related to housing. The commenters stated that
the entire proposed rule is an abuse of discretion by HUD, should be
viewed with scrutiny, and should not be adopted.
Response: The language to which the commenters referred was located
in the proposed rule's preamble, not within the proposed regulatory
text. This language will not be codified in the final regulation, but
rather explained the proposed rule's relationship with guidance
documents and Executive
[[Page 82115]]
Order 13891. The language, however, is consistent with the APA, 5
U.S.C. 551, et seq., and Executive Order 13891. HUD believes that the
proposed rule was promulgated under proper authority.
Changes: None.
Affected Regulations: None.
c. RIA/Administrative Sections
Summary of Comments: According to commenters, HUD failed to meet
its burden under the APA because it did not explain why the Proposed
Rule was necessary, nor did it consider the burden on beneficiaries.
The commenters stated regulations based on Executive Order 13559 have
been working well since 2016, and HUD has not provided any reason for
the Proposed Rule except that it assumes, without evidence, that there
is a significant burden to religious organizations. The commenters
referenced that HUD previously estimated a cost to providers ``of no
more than 2 burden hours and $100 annual materials cost for notices and
2 burden hours per referral'' in the 2016 final rule. HUD now concedes
that the burden per notice is no more than 2 minutes. According to the
commenters, while HUD estimates a cost savings of $656,128 for the
elimination of these vital protections, it provides no analysis on how
much was actually spent on notice-and-referral requirements, nor does
it provide reasoning for its inflated estimate. The commenters said HUD
recognizes that the removal of the notice-and-referral requirements
could impose some costs on beneficiaries who will now need to find
alternative providers on their own if they object to the religious
character of a potential provider. The commenters argued HUD's baseless
estimates of cost savings do not justify the increased burden on
beneficiaries nor the risk to their vital constitutional protections.
The commenters continued that employment discrimination has
numerous costs for workers and society, including lost wages and
benefits, lost productivity, and negative impacts on mental and
physical health. According to the commenters, HUD fails to acknowledge
the potential costs the proposed rule could generate, and this is a
case law manipulation to allow organizations to discriminate under
false pretenses and deny access to reproductive health care. The
commenters argued HUD fails to account for economic and noneconomic
costs to employees in the form of lost wages and benefits, out of
pocket medical expenses, costs associated with job searches, and costs
related to negative mental and physical health consequences of
discrimination.
Response: As HUD explained in the proposed rule, Executive Order
13831 eliminated the alternative provider referral requirement and
requirement of notice established in Executive Order 13559. In
addition, HUD cited recent Supreme Court decisions that addressed
freedom and anti-discrimination protections that must be afforded
religious organizations and individuals under the U.S. Constitution and
Federal law since the current regulations implementing Executive Order
13559 were promulgated. HUD removed the alternative provider referral
requirement and notice requirement because it placed a burden on
religious organizations, whereas there was no corresponding burden on
non-religious organizations.
As for the commenters' concerns regarding beneficiaries' burden,
HUD considered the cost to potential beneficiaries to be minimal and
such cost and benefits are discussed above in the joint-agency
response. Beneficiaries prior to the 2016 rule and after this rule will
continue to seek alternative providers for many different reasons and
requests for such alternatives from HUD offices and grantees can
continue without placing a specific burden on religious organizations.
As for costs, this rule removes the requirement that all faith-based
organizations under the 2016 rule were required to provide notices to
every beneficiary which is a determinable cost for which HUD can
estimate burden reduction. HUD also incorporates the discussion of
costs and benefits from Part II.K.1 above.
As for the concern regarding employment discrimination, HUD is not
making any changes to its regulation concerning the exemption for Title
VII employment discrimination requirements that was in this prior to
the 2016 regulation at 24 CFR 5.109(i).
Changes: None.
Affected Regulations: None.
F. Department of Justice
DOJ did not identify any comments or issues unique to the
Department; accordingly, DOJ is making no further changes to its
regulations beyond those explained above.
G. Department of Labor
1. Beneficiary Harms
Summary of Comments: One commenter to the Department of Labor's
proposed rule addressed underlying disparities in the need for social
services that would make transgender people more vulnerable to
discrimination following the removal of certain beneficiary
protections. More specifically, the commenter addressed disparities in
the following areas that are relevant to Department programs:
Unemployment and employment opportunities (Employment and Training
Administration programs); disability-related needs (Employment and
Training Administration programs); incarceration and re-entry supports
(Reentry Employment Opportunities program); and veterans assistance
(Homeless Veterans' Reintegration Program). In addition, some faith-
based advocacy organizations warned that the proposed rule would
disserve a wide range of Federal programs, including the Department's
Senior Community Service Employment Program and Homeless Veterans'
Reintegration Program.
Response: While these commenters focused on specific Department of
Labor programs, the assertion that the removal of beneficiary
protections would be harmful or would disserve beneficiaries was also
raised by commenters on proposed rules other than the Department of
Labor's and was addressed previously at Parts II.C.2.a, II.C.2.b, and
II.C.3.e. The Department of Labor does not believe that removing the
alternative provider notice-and-referral requirements unlawfully or
inappropriately burdens third parties as the Department maintains that
the final rule does not change any existing requirements regarding the
services provided to beneficiaries.
Changes: None.
Affected Regulations: None.
2. Notice Requirement
Summary of Comments: An advocacy organization commented that the
Department's rationale that faith-based organizations are not less
likely than other providers to follow the law did not justify the
repeal of the notice requirement. This advocacy organization referred
to the inconsistency among Federal Agencies' citation of alignment with
RFRA in repealing notice requirements.
In addition, an individual commenter requested that the Department
provide evidence about alternative, reliable mechanisms to ensure that
beneficiaries are aware of their rights. The Council Chair also
commented that the Department, in the present rulemaking, had not
considered alternative methods of ensuring that beneficiaries receive
notice of their rights or referrals to alternative providers, such as
requiring governmental bodies to provide such notice and make referrals
upon request.
[[Page 82116]]
Response: The first comment assumes that the Department is
obligated to justify the removal of a burden on religious persons. But
RFRA provides just the opposite: ``Government shall not substantially
burden a person's exercise of religion'' unless it can justify imposing
the burden. 42 U.S.C.2000bb-1(a) (emphasis added). Even absent RFRA,
the Department sees no reason to continue imposing additional
requirements solely on religious groups without evidence that they are
different, such as by being more prone to violate the law--for which
the Department has no evidence. As previously discussed in Part II.C,
the prior regulations singled out religious groups, placing burdens on
them that were not otherwise placed on non-religious groups. This final
rule eliminates extraneous burdens on faith-based organizations and
will ensure that federally funded social service programs are
implemented in a manner that is consistent with the requirements of
Federal law.
As previously discussed in Part II.C.3.d, the Department is within
its discretion to resolve the tension between rights here, especially
in light of the uncertainty about whether there is a compelling
interest in applying the alternative provider notice-and-referral
requirements solely to religious organizations. And it is also within
the Agencies' discretion to avoid serious constitutional issues and the
burdens of related litigation. While it remains questionable what
rights beneficiaries have to a secular provider under the Zelman v.
Simmons-Harris standard, in any event, however, the Department's Civil
Rights Center continues to enforce civil rights protections for
applicants, participants, and beneficiaries of programs and activities
that receive Federal financial assistance from the Department, as well
as programs and activities funded or otherwise financially assisted
under Title I of the Workforce Innovation and Opportunity Act.
Alternative notice arrangements were previously discussed in Part
II.C.3.d. In addition, the Department did not propose imposing such
requirements on governmental bodies, but it did note that ``the
Department could supply information to beneficiaries seeking an
alternate provider'' when it ``makes publicly available information
about grant recipients that provide benefits under its programs.'' 85
FR 2931. Imposing notice-and-referral requirements on governmental
bodies when faith-based organizations provide services would conflict
with the nondiscrimination principle articulated in Trinity Lutheran
and the Attorney General's Memorandum and, moreover, would be
inconsistent with the Administration's broader deregulatory agenda.
Under the final rule, the provision of such information remains an
option but not a requirement.
Changes: None.
Affected Regulations: None.
3. Deregulatory Action Determination (Executive Order 13771)
Summary of Comments: The Council Chair objected to the Department's
conclusion that notice-and-referral requirements conflict with the
administration's deregulatory agenda, because doing so privileges
policy goals above religious freedom.
Response: The Department disagrees that removing the notice-and-
referral requirements privileges policy goals above religious freedom.
On the contrary, the removal of those requirements is intended to
protect and enhance religious liberty, see Burwell v. Hobby Lobby
Stores, Inc., 573 U.S. 682, 709 (2014) (furthering organizations'
``religious freedom also furthers individual religious freedom''
(quotation marks omitted)), consistent with the Administration's policy
goals. With regard to the E.O. 13771 determination, deregulatory
actions are measured by the presence or absence of government mandates.
The final rule will relieve faith-based organizations in the private
sector of the regulatory mandates of notice and referral, thereby
reducing government-imposed requirements placed on the private sector.
It is therefore deregulatory.
Changes: None.
Affected Regulations: None.
4. General Comments
Summary of Comments: An individual commented that the Department's
goal in issuing the proposed rule appeared to be using faith-based
organizations to privatize government services. Another individual
commenter suggested that organizations with interests that go against
U.S. foreign policy objectives, domestic policy agendas, agencies, or
regulations should be ineligible to apply. Finally, an anonymous
commenter asked how the proposal would affect the quantity and quality
of government services, what data collection measures would be used to
independently monitor and assess the changes, and where the public
could find annual reports on how well the proposed changes worked.
Response: The Department's purpose in promulgating this rule is not
to privatize services. It is to implement the nondiscrimination
principle articulated in Trinity Lutheran and the Attorney General's
Memorandum--that is, to level the playing field, not to favor or
disfavor faith-based organizations. Any concern about ``privatization''
of government services could apply equally to any government grant
where a private, non-government entity, regardless of its religious
character, offers services to the public using grant funding. In
addition, neither the proposal nor the final rule would change the
extent of so-called privatization or the amount or allocation of
grants. The rule is aimed only at clarifying faith-based organizations'
ability to participate equally in the Department's programs and
activities. It does not change eligibility criteria for grants or
disfavor applicants of particular agendas.
Unless the quantity of grants changes, the Department does not
expect the final rule to change the overall quantity or quality of
services offered. However, the Department does expect an increase in
the capacity of faith-based providers to provide services, both because
these providers will be able to shift resources otherwise spent
fulfilling the notice-and-referral requirements to providing services
and because more faith-based social service providers may participate
in the marketplace under these streamlined regulations. It is entirely
possible that the participation by additional organizations may enhance
competition to provide services to the public and that this could
result in higher quality government services, but the Department is not
claiming that such a result will necessarily result from this change to
reduce the unequal burden on faith-based providers. No mechanisms for
data collection, monitoring, or reporting were proposed or are included
in the final rule. However, recipients of financial assistance from the
Department remain subject to financial and performance reporting
requirements and audit requirements to ensure proper grants management
practices. See, e.g., 2 CFR parts 200, 2900. In addition, recipients of
financial assistance under WIOA Title I must collect and maintain data
and information related to nondiscrimination. See 29 CFR 38.41 through
38.45.
Changes: None.
Affected Regulations: None.
H. Department of Veterans Affairs
Summary of Comments: VA received a comment seeking clarification on
who will benefit from the new rule and what motivated the new rule. Two
commenters asked how the new rule will affect the quality or quantity
of
[[Page 82117]]
government services and whether government services will improve.
Another commenter asked whether data collection measures will be used
to independently monitor and assess the changes and if the public will
have access to annual reports on how well the proposed change worked.
Response: Faith-based organizations will likely benefit from the
new rule because it provides clarity about the rights and obligations
of faith-based organizations participating in the Department's social
services programs and removes burdensome requirements only imposed on
faith-based organizations. It will promote fairness and wider
participation in VA programs by ensuring that faith-based organizations
can participate on an equal footing with other entities. To the extent
that the removal of this burden encourages faith-based organizations to
apply to participate in the Department's programs, it may encourage
participation in those programs, leading to improved quality or
quantity of services provided. Notwithstanding the removal of the
burdensome requirements on faith-based organizations, grantees will
still assist Veterans in accessing needed services either from within
the current provider or through referrals to an alternative provider as
needed.
In addition, VA does not anticipate the need for monitoring the
changes or compiling annual reports. Grantees will still be bound by
the rules and policies of the grant program. Any issues or questions
about the changes will be addressed by the relevant program office as
they arise.
Changes: VA has revised the final regulatory text for clarity and
accuracy. The final regulatory text will state ``VA program'' instead
of ``VA awarding agency''.
Affected Regulations: 38 CFR 50.2(a), (b), (c), (e), (f), (g), (h),
(j), 61.64(a), (d), (e), 62.62(e).
I. Department of Health and Human Services
1. Nondirective Mandate
Summary of Comments: One commenter said that the Proposed Rule
violates Congress's nondirective mandate in the Title X program. The
commenter stated that, in appropriations bills since 1996, Congress has
mandated that ``all pregnancy counseling'' in Title X family planning
projects ``shall be nondirective.'' The commenter argued that, when
faith-based organizations provide or offer referrals for certain
services but not others--like abortion or to obtain contraception--the
omission of medical options flies in the face of the nondirective
mandate.
Response: HHS disagrees that the final rule conflicts with the non-
directive pregnancy counseling rider applicable to the Title X program,
which provides funding for preconception family planning services. The
Title X program has its own regulations at 42 CFR part 59, and certain
provisions of that rule specifically govern certain types of referrals
and their relation to the non-directive pregnancy counseling rider. To
that extent, the Title X regulations would apply to how that program
handles those referral matters. This final rule does not change how the
provisions of the Title X regulation govern matters concerning the non-
directive pregnancy counseling rider and referrals in the Title X
program, especially since the Title X regulations do not identify part
87 as applicable to Title X grants. See 42 CFR 59.10 (identifying the
``other HHS regulations [that] apply to grants under this subpart'').
HHS also disagrees with the commenter's view concerning the non-
directive pregnancy counseling rider for Title X. The commenter
contends the rider requires Title X grantees to make referrals for all
post-conception treatment options. But the rider only requires that if
pregnancy counseling is provided, it shall be non-directive. Thus,
contrary to the commenter's suggestion, the nondirective pregnancy
counseling rider only applies to post-conception counseling; it does
not apply to post-conception referrals. It is important to note that in
the Title X program, post-conception referrals are referrals out of the
Title X program for health care services that are not provided under
the Title X program; in contrast, the referrals required by the 2016
rule which are being eliminated by this final rule are referrals from
one service provider to another service provider within the same
program. Furthermore, as the en banc court of appeals for the Ninth
Circuit recently stated in upholding the Title X rule, non-directive
only means options must be provided in a neutral manner, not that all
conceivable options must be presented. California v. Azar, 950 F.3d
1067 (9th Cir. 2020). Thus, even if these equal treatment regulations
were applicable to the Title X program, there is no tension between the
Title X non-directive pregnancy counseling rider and this final rule.
Changes: None.
Affected Regulations: None.
2. Certain Provisions of the ACA
Summary of Comments: A few commenters said that the final rule will
clash with several provisions of the Patient Protection and Affordable
Care Act (ACA), because it will allow entities to decline to provide
information and referrals. Commenters argued that the rule violates
section 1554 of the ACA, which prohibits the Secretary of HHS from
creating barriers to healthcare, and section 1557, which prohibits
discrimination in health programs or activities. Another commenter said
that the final rule transforms the Department's role from an agency
focused on ensuring nondiscriminatory provision of health care to one
that facilitates refusals of care. The commenter said that giving
health care providers enhanced powers to refuse patient care in the
name of ``conscience'' should be reconciled with the protections for
patients under the ACA and other statutes.
Response: HHS disagrees with commenters' characterization of the
final rule. The rule merely ensures that HHS's programs are implemented
in a manner consistent with Federal law, by ensuring that faith-based
organizations may participate in social service programs funded by HHS
on an equal basis with secular service providers, consistent with the
law. Nothing in the rule addresses the provision of health care per se
by health care providers, or provides health care providers with
enhanced powers to refuse patient care. In addition, the equal
treatment regulations only apply to ``HHS social service programs''
under Sec. 87.2, which the final rule does not modify. Many of the
instances of which commenters are concerned may not be encompassed by
the final rule.
Section 1554 of the ACA, 42 U.S.C. 18114, provides that,
``[n]otwithstanding any other provision of this Act [the ACA],'' the
Secretary of Health and Human Services shall not promulgate any
regulation that creates any unreasonable barriers to the ability of
individuals to obtain appropriate medical care, impedes timely access
to health care services, interferes with communications regarding a
full range of treatment options between the patient and the provider,
restricts the ability of health care providers to provide full
disclosure of all relevant information to patients making health care
decisions, violates the principles of informed consent and the ethical
standards of health care professionals, or limits the availability of
health care treatment for the full duration of a patient's medical
needs. The clear meaning of
[[Page 82118]]
``[n]otwithstanding any other provision of this Act,'' is that--to the
extent that section 1554 contains enforceable limitations on the
Secretary's regulatory authority \98\--the provision limits the
Secretary's regulatory authority under the ACA, not with respect to any
other regulatory authorities possessed by the Secretary.\99\
---------------------------------------------------------------------------
\98\ Section 1554's subsections are open-ended. Nothing in the
statute specifies, for example, what constitutes an ``unreasonable
barrier[ ],'' ``appropriate medical care[,]'' ``all relevant
information[,]'' or ``the ethical standards of health care
professionals[.]'' 42 U.S.C. 18114. And there is nothing in the
ACA's legislative history that sheds light on the provision. Under
these circumstances, it is a substantial question whether section
1554 claims are reviewable under the APA at all. See Citizens to
Preserve Overton Park, Inc. v. Volpe, 401 U.S. 402, 420 (1971)
(explaining that the APA bars judicial review of agency decision
where, among other circumstances, ``statutes are drawn in such broad
terms that in a given case there is no law to apply'' (citation
omitted)).
\99\ See, e.g., California by & through Becerra v. Azar, 927
F.3d 1068, 1079 (9th Cir.), reh'g en banc granted sub nom. State by
& through Becerra v. Azar, 927 F.3d 1045 (9th Cir. 2019) (``The
preamble to Sec. 1554 also suggests that this section was not
intended to restrict HHS interpretations of provisions outside the
ACA. If Congress intended Sec. 1554 to have sweeping effects on all
HHS regulations, even those unrelated to the ACA, it would have
stated that Sec. 1554 applies `notwithstanding any other provision
of law,' rather than `[n]otwithstanding any other provision of this
Act.'''); id. (``[T]he phrase `notwithstanding any other provision
of law' in 8 U.S.C. 1252(f)(2) meant that the provision `trumps any
contrary provision elsewhere in the law''' (quoting Andreiu v.
Ashcroft, 253 F.3d 477, 482 (9th Cir. 2001)).
---------------------------------------------------------------------------
A reconsideration and elimination of certain regulatory provisions,
particularly regulations not promulgated under the ACA, neither creates
unreasonable regulatory barriers nor impedes timely access to health
care. If it were otherwise, section 1554 would essentially serve as a
one-way ratchet, preventing HHS from ever reconsidering any regulation
that could be characterized as improving access to healthcare in some
sense, regardless of the other burdens such regulation may impose on
access to health care. HHS's approach in this final rule is consistent
with the Ninth Circuit's recent interpretation of section 1554: ``The
most natural reading of Section 1554 is that Congress intended to
ensure that HHS, in implementing the broad authority provided by the
ACA, does not improperly impose regulatory burdens on doctors and
patients.'' California v. Azar, No. 19-15974, 2020 WL 878528, at 18
(9th Cir. Feb. 24, 2020) (en banc). As explained throughout the
preamble, the final rule avoids precisely such burdens by removing
notice-and-referral requirements that imposed burdens on faith-based
organizations without burdening similarly situated secular
organizations. In addition, this final rule is not promulgated under
any provision of the ACA. Rather, it amends HHS's equal treatment for
faith-based organizations regulations (45 CFR part 87) (``equal
treatment regulations'') in order to implement Executive Order 13831,
on the Establishment of a White House Faith and Opportunity Initiative.
80 FR 47271. Executive Order 13831 requires removal of the alternative
provider notice-and-referral requirements, which eliminates the burdens
that the regulations promulgated in 2016, pursuant to Executive Order
13559, imposed exclusively on faith-based organizations. The removal of
the alternative provider provisions places faith-based organizations on
a level playing field with secular organizations, while alleviating the
tension with recent Supreme Court precedent regarding nondiscrimination
against religious organizations, the Attorney General's Memorandum, and
RFRA, 42 U.S.C. 2000bb et seq. Additionally, the final rule does not
create barriers for individuals to obtain appropriate medical care.
Faith-based providers of social services, like other providers of
social services, are required to follow the law and the requirements
and conditions applicable to the grants and contracts they receive.
There is no basis on which to presume that they are less likely than
secular social service providers to follow the law. There is,
therefore, no need for preventive or prophylactic protections that
create administrative burdens on faith-based providers that are not
imposed on similarly situated secular providers.
HHS also disagrees with the comment alleging that the elimination
of the alternative provider requirements conflict with ACA section
1557, 42 U.S.C. 18116. Section 1557 generally provides that an
individual shall not be excluded from participation in, be denied
benefits of, or be subjected to discrimination under any health program
or activity that receives Federal financial assistance, including
credits, subsidies, or contracts of insurance, or under any program or
activity that is administered by HHS or any entity established under
Title I of the ACA. 42 U.S.C. 18116(a). Section 1557 prohibits
discrimination on the basis of certain protected classes in the cited
civil rights laws, namely race, color, national origin, sex, age, or
disability. Section 1557 applies, to such health programs or
activities, the long-standing and familiar Federal civil rights laws:
Title VI of the Civil Rights Act of 1964, Title IX of the Education
Amendments of 1972, section 504 of the Rehabilitation Act of 1973 and
the Age Discrimination Act of 1975. Section 1557 applies exclusively to
health programs or activities receiving Federal financial assistance or
to entities created under Title I of the ACA. As noted above, this rule
only applies to ``HHS social service programs'' under Sec. 87.2, which
the final rule does not modify. Many of the instances of which
commenters are concerned under section 1557 of the ACA may not be
encompassed by the final rule. The elimination of the alternative
provider notice-and-referral requirements merely places faith-based
organizations on an even-playing field with secular organizations.
Faith-based providers of social services, like other social service
providers, must still adhere to the requirements of other applicable
laws, which may (or may not) include section 1557.
Changes: None.
Affected Regulations: None.
3. Notice Requirements in Other Department Regulations
Summary of Comments: One commenter said that Federal agencies have
routinely included notice requirements for individual program
beneficiaries in other nondiscrimination regulations, and in voluntary
resolution agreements, including for large entities where the
administrative effort involved may be significant. The commenter stated
that removing the alternative provider requirements contrasts to the
approach taken by HHS in a recent final rule, Protecting Statutory
Conscience Rights in Health Care, which included a provision that ``OCR
will consider an entity's voluntary posting of a notice of
nondiscrimination as non-dispositive evidence of compliance.''
Protecting Statutory Conscience Rights in Health Care; Delegations of
Authority, 84 FR 23170 (May 21, 2019) (vacated, see, e.g., New York v.
United States Department of Health and Human Services, 414 F. Supp. 3d
475 (S.D.N.Y. 2019)).
Response: HHS disagrees that the approach of the proposed rule and
this final rule with respect to notice is inconsistent with the
approach to notice taken in the recent final rule, Protecting Statutory
Conscience Rights in Health Care, 84 FR 23170 (May 21, 2019) (2019
Conscience Rule), or in voluntary resolution agreements. The
commenter's example of notice requirements in the context of voluntary
resolution agreements is not analogous to the alternative provider
requirements being eliminated in this final rule. Voluntary resolution
agreements are used when there has been a finding of a violation of
Federal laws. And the provision in
[[Page 82119]]
the Department's 2019 Conscience Rule (vacated, see, e.g., New York v.
United States Department of Health and Human Services, 414 F.Supp.3d
475 (S.D.N.Y. 2019)), refers to a situation where HHS's Office for
Civil Rights (OCR) may be undertaking a compliance review or
investigating a covered entity which is in alleged violation of Federal
laws. That rule merely states that ``OCR will consider an entity's
voluntary posting of a notice of nondiscrimination as non-dispositive
evidence of compliance with the applicable substantive provisions of
this part, to the extent such notices are provided according to the
provisions of this section and are relevant to the particular
investigation or compliance review.'' Id. at 23270. In that context,
the voluntary notice would state that the entity complies with
applicable Federal conscience and nondiscrimination laws and that
individuals may have the right under Federal law to decline to perform,
assist in the performance of, refer for, undergo, or pay for certain
health care-related treatments, research, or services that violate the
individual's conscience. The 2019 Conscience Rule, which would apply to
all entities to which the Federal conscience laws apply, provides, with
respect to all such entities, that the voluntary posting of such a
nondiscrimination notice establishes non-dispositive evidence of
compliance with the 2019 Conscience Rule. In contrast, the current
regulation requires a subset of the recipients of HHS-funded social
services grants--namely, faith-based organizations that receive funds
from the HHS--to provide, to each beneficiary whom they would serve,
notice of the beneficiary's right to receive services from a secular
service provider. HHS, thus, disagrees with the commenter that this
alternative provider notice requirement placed solely on faith-based
organizations is, in any way, analogous to the voluntary
nondiscrimination notices contemplated by the 2019 Conscience Rule.
The alternative provider requirements, moreover, raise serious
concerns under the First Amendment and RFRA. As the Supreme Court
clarified in Trinity Lutheran Church of Columbia, Inc. v. Comer, 137 S.
Ct. 2012, 2019 (2017) (quoting Church of Lukumi Babalu Aye, Inc. v.
Hialeah, 508 U.S. 520, 533 (1993) (alteration in original)): ``The Free
Exercise Clause `protect[s] religious observers against unequal
treatment' and subjects to the strictest scrutiny laws that target the
religious for `special disabilities' based on their `religious status.'
'' The Court in Trinity Lutheran added: ``[T]his Court has repeatedly
confirmed that denying a generally available benefit solely on account
of religious identity imposes a penalty on the free exercise of
religion that can be justified only by a state interest `of the highest
order.' '' Id. (quoting McDaniel v. Paty, 435 U.S. 618, 628 (1978)
(plurality opinion)); see also Mitchell v. Helms, 530 U.S. 793, 827
(2000) (plurality opinion) (``The religious nature of a recipient
should not matter to the constitutional analysis, so long as the
recipient adequately furthers the Government's secular purpose.'').
Additionally, the Attorney General's Memorandum noted that ``Government
may not target religious individuals or entities for special
disabilities based on their religion.'' Principle 6 of the Attorney
General's Memorandum, 82 FR 49668 (October 26, 2017). Applying the
alternative provider requirements categorically to all faith-based
providers, but not to other, secular providers, of federally funded
social services, is thus in tension with the nondiscrimination
principle articulated in Trinity Lutheran and the Attorney General's
Memorandum.
In addition, the alternative provider requirements could in certain
circumstances run afoul of the protections established by RFRA. Under
RFRA, where the Federal Government substantially burdens an entity's
exercise of religion, the Federal Government must prove that the burden
is in furtherance of a compelling government interest and is the least
restrictive means of furthering that interest. 42 U.S.C. 2000bb-1(b).
Most faith-based organizations engaged in the provision of social
services do so as part of their religious mission--because their
religious beliefs compel them to serve their fellow human beings. In
such circumstances, the alternative service provider notice requirement
may substantially burden the religious exercise of those recipients.
See Application of the Religious Freedom Restoration Act to the Award
of a Grant Pursuant to a Juvenile Justice and Delinquency Prevention
Act, 31 O.L.C. 162, 169-71, 174-83 (June 29, 2007). Requiring faith-
based organizations to comply with the alternative provider notice
requirement could impose this burden, such as in a case in which a
faith-based organization has a religious objection to referring the
beneficiary to an alternative provider that provided services in a
manner that violates the organization's religious tenets. See, e.g.,
Burwell v. Hobby Lobby Stores, Inc., 573 U.S. 682, 720-26 (2014).
Changes: None.
Affected Regulations: None.
4. Medical Ethics
Summary of Comments: One commenter said that eliminating the
alternative provider requirements will place nurses in burdensome
ethical dilemmas. The commenter explained that, to the extent that a
nurse is employed by a provider whose service offerings may be limited
by moral or religious objections, the Code of Ethics for Nurses
requires that nurses with conscientious objections to certain medical
procedures must communicate their objection as soon as possible, in
advance and in time for alternative arrangements to be made for patient
care.
Response: HHS disagrees that removing the alternative provider
notice-and-referral requirements will place nurses in burdensome
ethical dilemmas. First, the final rule only applies to ``HHS social
service programs'' under Sec. 87.2. Therefore, many instances
commenters are concerned about regarding nurses may not be encompassed
by this rule. Second, the final rule does not prohibit organizations or
individuals from informing beneficiaries that they can receive services
from a secular provider or from voluntarily referring beneficiaries to
some other provider. Rather, it merely removes the alternative provider
notice-and-referral requirements that were placed solely on faith-based
organizations and not on similarly situated secular organizations.
Thus, to the extent that an organization or individual believes that
its or his/her ethical obligations require the provision of notice to
beneficiaries of alternative providers of social services, such
organization or individual remains free to provide such notice.
HHS notes, however, that if it were not to remove the current
alternative provider notice-and-referral requirements, the exact
concern raised by the commenter could occur: Nurses and faith-based
providers could foreseeably be placed in burdensome ethical dilemmas
under the current notice-and-referral requirements. For example, either
a faith-based organization or an individual nurse may hold a religious
objection to referring a beneficiary to an alternative provider that
provides services in a manner that violates the organization's or
nurse's religious tenets. See, e.g., Burwell v. Hobby Lobby Stores,
Inc., 573 U.S. 682, 720-26 (2014). When a faith-based recipient carries
out its social service programs, it may engage in an exercise of
religion protected by RFRA, and certain conditions on receiving those
grants may substantially burden the
[[Page 82120]]
religious exercise of that recipient. See Application of the Religious
Freedom Restoration Act to the Award of a Grant Pursuant to a Juvenile
Justice and Delinquency Prevention Act, 31 O.L.C. 162, 169-71, 174-83
(June 29, 2007).
Changes: None.
Affected Regulations: None.
5. Discrimination Against Women, Persons With Disabilities, Low-Income
Persons, and LGBT Persons
Summary of Comments: Several commenters stated that removing the
notice-and-referral requirements will adversely impact women, LGBT,
persons with disabilities, or low-income persons. Two commenters stated
that women of color in many States disproportionately receive their
care at Catholic-affiliated hospitals, which often follow an ethical
directive that prohibits the hospital from providing emergency
contraception, sterilization, abortion, fertility services, and some
treatments for ectopic pregnancies. Accordingly, commenters expressed
concern that, if the final rule is implemented, more women,
particularly women of color, will be put in situations where they will
either lack access to certain reproductive health care services or be
required to find another provider willing to provide comprehensive
reproductive health services, if such services are available in their
communities.
Other commenters said that the final rule would permit
discrimination against LGBT parents and children in adoption, foster
care, and child welfare services. Commenters stated that the proposed
rule would result in more children remaining in foster and congregate
care by allowing religious providers to discriminate against LGBT
people seeking to adopt. Commenters also said that the final rule would
allow faith-based providers to discriminate against LGBT children
trying to access services. Other commenters voiced concern that the
final rule would cause a public health crisis for LGBT persons who may
be left without knowledge of alternative providers to faith-based
health care providers in emergency situations. Another commenter stated
that the rule would contribute to significant health costs from the
medical and mental health impacts of discrimination, citing a study
that found that experiencing discrimination in health care, among other
sectors, is associated with higher prevalence of suicidal thoughts and
attempts among individuals who identify as transgender. Commenters
noted that, because no other agency in the Government offers more
grants than HHS, HHS's changes to the alternative provider requirement
will create the highest incidence of discrimination because of the very
scale at which the agency operates.
Numerous commenters also stated that the final rule would allow
people in faith-based organizations to use their religion to spread
hatred and cause harm to anyone with whom the faith-based provider
disagrees. These commenters said that the final rule returns the
Department to a time when American citizens can be denied any and all
services as long as the refuser says that the denial is due to the
provider's religious beliefs. Other commenters said that they support
the participation of faith-based organizations in federally funded
service programs. These commenters opined that religious providers are
the backbone of America, and that no organization should be
discriminated against because of its religious or moral beliefs.
Commenters stated that, as long as faith-based service providers can
meet the necessary eligibility requirements to participate in service
programs, commenters saw no downside to allowing such groups to
participate, because such participation would create the provision of
more services in communities, especially in communities that face
greater obstacles in obtaining services. Other commenters stated that
faith-based organizations bring large numbers of people who provide
services as an outgrowth of their religious beliefs and because of
their love for the people in their communities. Some commenters noted
that religious persons comprise the most prolific pool of adoptive
families in the nation. Commenters also said that they support the
final rule because it clarifies that faith-based providers, including
hospitals, homeless shelters, and adoption and foster care providers
among others, may operate according to their religious beliefs and
still participate in Federal service programs.
Response: HHS believes that all people should be treated with
dignity and respect, especially in its programs, and that they should
be given every protection afforded by the Constitution and the laws
passed by Congress. HHS does not condone the unjustified denial of
needed medical care or social services to anyone. And it is committed
to fully and vigorously enforcing all of the nondiscrimination statutes
entrusted to it by Congress. HHS does not agree with commenters who
claim that the final rule will create a high incidence of
discrimination, raise the costs of health care, cause harm, spread
hatred, keep more children in foster and congregate care, or adversely
impact women, persons with disabilities, low-income, or self-
identifying LGBT persons. HHS is not aware of an instance in which a
beneficiary has sought a referral for an alternative provider.
Commenters who voiced concern about HHS's removal of the alternative
provider requirements generally did not provide evidence, anecdotal or
otherwise, that beneficiaries sought referrals required under those
provisions. Thus, removing the alternative provider requirements would
likely not raise health care costs, jeopardize benefits, or cause a
public health crisis for beneficiaries. HHS beneficiaries, even in
times of emergencies, are capable of obtaining services, and have
obtained such services, without requiring HHS to place requirements on
faith-based providers that it did not place on similarly situated
secular providers. HHS also notes that this final rule applies to
certain social services programs under Sec. 87.2. Therefore, many of
the situations that commenters are concerned about regarding nurses may
not be encompassed by this rule.
In response to commenters who expressed concerns about the ability
of faith-based providers to adequately serve the general public, HHS
notes, first, that faith-based organizations have a long history of
providing social services, independently and as part of programs funded
by HHS.\100\ Despite that long history, HHS is not aware of evidence
that faith-based organizations would, as a result of their religious
beliefs, be unable to provide services to the general public or to
specific vulnerable populations. Faith-based providers, like other
providers, are required to follow the requirements and conditions of
their Federal grants and contracts and may not violate those
requirements. HHS finds no basis on which to presume that faith-based
providers are less likely than other providers to follow the law. See
Mitchell v. Helms, 530 U.S. 856-57 (2000) (O'Connor, J., concurring in
judgment). Thus, religious providers cannot deny ``any and all services
as long as the refuser says that the denial is due to the
[[Page 82121]]
provider's religious belief,'' as some commenters claimed.
---------------------------------------------------------------------------
\100\ See, e.g., Lisa McCracken, Faith and the Not-For-Profit
Provider, Ziegler Investment Banking, Aug. 25, 2014, http://image.exct.net/lib/ff021271746401/d/4/zNews_Featured_082514.pdf;
Byron Johnson et al., Assessing the Faith-Based Response to
Homelessness in America: Findings from Eleven Cities, Baylor
Institute for Studies of Religion (2017), http://www.baylorisr.org/wp-content/uploads/ISR-Homeless-FINAL-01092017-web.pdf; Catholic
Health Association of the United States, Catholic Health Care in the
United States (last updated Jan. 2017), https://www.chausa.org/about/about/facts-statistics.
---------------------------------------------------------------------------
Second, HHS recognizes, as noted in Executive Orders 13279 and
13831, the important work that faith-based providers perform for
communities in need of services. Executive Order 13279 identifies that
faith-based providers participating in social service programs, as
defined by the Executive Order, work to reduce poverty, improve
opportunities for low-income children, revitalize low-income
communities, empower low-income families and individuals to become
self-sufficient, and otherwise help people in need. E.O. 13279, 67 FR
77141 (2002). Similarly, as Executive Order 13831 observed, faith-based
organizations have a special ability to provide services to
individuals, families, and communities through means that are
``different from those of government and with capacity that often
exceeds that of government.'' E.O. 13831, 83 FR 20715 (2018). The
Executive Order further states that faith-based providers ``lift people
up, keep families strong, and solve problems at the local level.'' Id.
And several commenters opined that faith-based providers and the
individuals who work for them are motivated by a desire to serve and
help the people in their communities. Commenters also noted that
religious beneficiaries comprise the most prolific pool of adoptive
families in the nation, which helps remove children from foster and
congregate care and place them in permanent homes with forever
families.
In addition, HHS does not agree with commenters who predict that
the final rule will result in beneficiaries losing access to services,
because the participation of faith-based providers will generally
increase the amount of services available to all beneficiaries,
including religious minorities, women, women of color, low-income, and
LGBT persons, and persons with disabilities. Allowing a broader
spectrum of providers increases the possibility for all beneficiaries,
including vulnerable populations, religious minorities, or persons with
disabilities, to be able to locate providers whose goals and values
more closely align with their own values. Furthermore, HHS funds
several resource centers, hotlines and helplines to provide
beneficiaries referrals to a diversity of social service providers
which include secular and faith-based organizations.\101\
---------------------------------------------------------------------------
\101\ See, e.g., 42 U.S.C. 10410 (Family Violence Prevention
Services Act national resource centers); Administration for Children
and Families, HHS, ACF Hotlines/Helplines, https://www.acf.hhs.gov/acf-hotlines-helplines (domestic violence, runaway and homeless
youth, and human trafficking hotlines and referral directories).
---------------------------------------------------------------------------
Commenters who voiced concerns about women, including women of
color, accessing reproductive services such as abortion, contraception,
sterilization, and certain infertility treatments, should note that,
for the last 50 years, Congress has protected providers and other
health care entities from being forced by public authorities (or by the
recipients of certain HHS funds) to perform certain health care
procedures to which they object. First, Congress enacted the Church
Amendments in the 1970s to ensure, among other things, that the
judicially recognized right to abortions, sterilizations, or related
practices would not lead to a requirement that individuals or entities
receiving certain HHS health service and research grants must
participate in activities to which they have religious or moral
objections. 42 U.S.C. 300a-7. Second, Congress passed in 1996 the
Coats-Snowe Amendment, which prohibits Federal, State, or local
governments from discriminating against any health care entity that
refuses to provide, require, or undergo training in performing
abortions, referring beneficiaries for abortions or abortion training,
or making arrangements for any of those activities. 42 U.S.C.
238n(a)(1)-(2). And third, Congress passed the Weldon Amendment in 2004
and readopted (or incorporated by reference) the amendment in each
subsequent appropriations act for the Departments of Labor, Health and
Human Services, and Education. See, e.g., Further Consolidated
Appropriations Act, 2020, Public Law 116-94, div. A, sec. 507(d), 133
Stat. 2534, 2607 (Dec. 20, 2019). The Weldon Amendment provides that
none of the funds made available in the applicable Labor, HHS, and
Education appropriations act may be made available to a Federal agency
or program, or to a State or local government, if such agency, program,
or government subjects any institutional or individual health care
entity to discrimination on the basis that the health care entity does
not provide, pay for, provide coverage of, or refer for abortions. The
alternative provider notice-and-referral requirements did not alter
these protections adopted by Congress, and removing such requirements
does not change these protections.
Finally, the Government may not compel faith-based providers to
change their religious identity or mission as a result of accepting
direct Federal financial assistance. Individuals and organizations do
not give up religious liberty protections because they provide
government-funded social services. The ``government may not exclude
religious organizations as such from secular aid programs . . . when
the aid is not being used for explicitly religious activities such as
worship or proselytization.'' Principle 6 of the Attorney General's
Memorandum, 82 FR 49668 (October 26, 2017). Accordingly, religious
organizations may retain their autonomy, right of expression, and
religious character in the provision of public services. HHS recognizes
that for many faith-based organizations, the provision of services to
those in need is an exercise of religion, and many faith-based
organizations view their explicitly religious activities as integral
parts of the programs and services that they provide.
Changes: None.
Affected Regulations: None.
IV. General Regulatory Certifications
A. Regulatory Planning and Review (Executive Order 12866); Improving
Regulation and Regulatory Review (Executive Order 13563)
This final rule was drafted in conformity with Executive Order
12866 and Executive Order 13563.
Executive Order 12866 directs agencies, to the extent permitted by
law, to propose or adopt a regulation only upon a reasoned
determination that its benefits justify its costs; tailor the
regulation to impose the least burden on society, consistent with
obtaining the regulatory objectives; and, in choosing among alternative
regulatory approaches, select those approaches that maximize net
benefits. Executive Order 13563 recognizes that some benefits and costs
are difficult to quantify and provides that, where appropriate and
permitted by law, agencies may consider and discuss qualitatively
values that are difficult or impossible to quantify, including equity,
human dignity, fairness, and distributive impacts.
Under Executive Order 12866, OIRA must determine whether this
regulatory action is ``significant'' and, therefore, subject to the
requirements of the executive order and subject to review by OMB.
OIRA has determined that this final rule is a significant, but not
economically significant, regulatory action subject to review by OMB
under section 3(f) of Executive Order 12866. Accordingly, OMB has
reviewed this final rule. Pursuant to the Congressional Review Act, 5
U.S.C. 801 et seq., OIRA
[[Page 82122]]
designated this rule as not a major rule, as defined by 5 U.S.C.
804(2).
The Agencies have also reviewed these regulations under Executive
Order 13563, which supplements and reaffirms the principles,
structures, and definitions governing regulatory review established in
Executive Order 12866. To the extent permitted by law, section 1(b) of
Executive Order 13563 requires that an agency engage in a cost-benefit
analysis. 76 FR at 3821. Section 1(c) of Executive Order 13563 also
requires an agency ``to use the best available techniques to quantify
anticipated present and future benefits and costs as accurately as
possible.'' Id. OIRA has emphasized that these techniques may include
``identifying changing future compliance costs that might result from
technological innovation or anticipated behavioral changes.''
Memorandum for the Heads of Executive Departments and Agencies, and of
Independent Regulatory Agencies, from Cass R. Sunstein, Administrator,
Office of Information and Regulatory Affairs, OMB M-11-10, Re:
Executive Order 13563, ``Improving Regulation and Regulatory Review''
at 1 (Feb. 2, 2011), https://www.whitehouse.gov/sites/whitehouse.gov/files/omb/memoranda/2011/m11-10.pdf.
The Agencies are issuing these final rules upon a reasoned
determination that their benefits justify their costs. In choosing
among alternative regulatory approaches, the Agencies selected those
approaches that maximize net benefits. Based on the analysis that
follows, the Agencies believe that these final rules are consistent
with the principles in Executive Order 13563. It is the reasoned
determination of the Agencies that these final rules would, to a
significant degree, eliminate costs that have been incurred by faith-
based organizations as they complied with the requirements of section
2(b) of Executive Order 13559, while not adding any other requirements
on those organizations.
The Agencies also have determined that this regulatory action does
not unduly interfere with State, local, or tribal governments in the
exercise of their governmental functions.
In accordance with Executive Orders 12866 and 13563, the Agencies
have assessed the potential costs, cost savings, and benefits, both
quantitative and qualitative, of this regulatory action.
1. Costs
The removal of the notice-and-referral requirements could impose
some costs on beneficiaries who may now need to investigate alternative
providers on their own if they object to the religious character of a
potential social service provider. The Agencies invited comments on any
information that they could use to quantify this potential cost, but
did not receive any comments that specifically addressed the cost of
compliance. Although the Agencies cannot quantify this cost with a
reasonable degree of confidence, we expect this cost to be de minimis.
The number of beneficiaries who will be denied services and therefore
would incur costs to identify an alternative provider would likely be
very small since this rule makes it clear that such organizations are
not permitted to discriminate in the provision of services.
2. Cost Savings
The potential cost savings associated with this regulatory action
are those resulting from the removal of the notice requirements and the
referral requirement, and those determined to be necessary for
administering the Agencies' programs and activities.
DOL previously estimated the cost of imposing the notice
requirements at no more than $200 per organization per year (in 2013
dollars). 81 FR at 19395. This cost estimate was based on the
expectation that it would take no more than two minutes for a provider
to print, duplicate, and distribute an adequate number of disclosure
notices for potential beneficiaries and $100 material costs annually.
Id. The Agencies have adjusted that amount to $220 (in 2020 dollars)
using the consumer price index (``CPI'').\102\ The Agencies solicited
comments on the compliance costs associated with the notice
requirements but received no comments.
---------------------------------------------------------------------------
\102\ Bureau of Labor Statistics CPI data published on June 10,
2020, https://www.bls.gov/news.release/cpi.htm.
\103\ Number of faith-based organizations that are DOL grant
recipients in FY2019.
\104\ Average number of faith-based organizations that are HHS
grant recipients in FY2019 and FY2020.
\105\ Number of faith-based organizations that are USCIS grant
recipients as of June 30, 2020.
\106\ Number of faith-based organizations that are USDA grant
recipients in FY2019.
\107\ Number of faith-based organizations that are DOJ grant
recipients in FY2019.
\108\ HUD reported no faith-based organizations affected by this
final rule.
\109\ USAID did not have the notice and referral requirements
previously, so this final rule change would not reduce any costs to
faith-based organizations that are USAID grant recipients.
\110\ VA identified 34 out of 257 Supportive Services for
Veteran Families grantees that appear to be faith-based.
\111\ A total of 904 institutions of higher education were
reported as having a religious affiliation in the Integrated
Postsecondary Education Data System in academic years 2018-2019.
---------------------------------------------------------------------------
As shown in Table 1, the Agencies estimated the annual cost savings
resulting from the removal of the notice requirements by multiplying
the number of faith-based organizations affected by the annual
compliance cost of the notice requirements ($220).
Table 1--The Annual Cost-Savings of the Removal of the Notice Requirements by Agency
----------------------------------------------------------------------------------------------------------------
Number of Cost-savings
Agencies faith-based per Annual cost-
organizations organization savings
(A) (B) (C = A x B)
----------------------------------------------------------------------------------------------------------------
DOL............................................................. \103\ 14 $220 $3,080
HHS............................................................. \104\ 119 220 26,180
DHS............................................................. \105\ 30 220 6,600
USDA............................................................ \106\ 16 220 3,520
DOJ............................................................. \107\ 67 220 14,740
HUD............................................................. \108\ 0 220 0
USAID........................................................... \109\ 0 220 0
VA.............................................................. \110\ 34 220 7,480
ED.............................................................. \111\ 904 220 198,880
-----------------------------------------------
Total....................................................... .............. .............. 260,480
----------------------------------------------------------------------------------------------------------------
[[Page 82123]]
In the 2016 final rule, the Agencies were previously unable to
quantify the cost of the referral requirement. 81 FR at 19395. However,
DOL estimated that each referral request would require no more than two
hours of a Training and Development Specialist's time to process. The
Agencies invited comment or any data by which they could assess the
actual implementation costs of the referral requirements. Although
commenters did not provide specific data regarding the burdens of the
referral requirement, several commenters did indicate that referral to
a new provider might result in some additional burdens for program
beneficiaries as they attempted to familiarize themselves with new
providers. The Agencies agree that this is a possible burden that
program beneficiaries may face but cannot effectively quantify it. The
Agencies assume that these burdens would be higher in situations where
new providers had dramatically different policies and procedures than
previous providers and would be relatively small in situations where
old and new providers have highly similar practices. Given that all
such providers would be operating Federal programs governed by the same
set of regulations and statutes, the Agencies believe the total amount
of potential differentiation among providers would likely be relatively
limited.
Although the Agencies do not have any way to accurately determine
the number of referrals that will occur in any one year, they do not
expect this number will be significant or that referral costs will be
appreciable for small service providers. Based on the Agencies'
records, referral requests are rare, and the Agencies are not aware of
any beneficiary who sought a referral under the prior requirement. See
Part III.C.
Table 2 shows the total annualized cost savings at a 7 percent
discounting by Agency for the removal of notification.\112\ For
example, the annualized cost savings for DOL-regulated entities is
$3,080 at a 7 percent discounting. Under Executive Order 13771 when
annualized over a perpetual time horizon at a 7 percent discount rate,
the cost savings of this rulemaking for DOL is $2,251 (in 2016
dollars).\113\
---------------------------------------------------------------------------
\112\ Since the annual cost savings by each Agency remain
constant over time, the total annual cost savings and the total
annualized cost savings at a 3 percent and a 7 percent are the same.
\113\ To comply with Executive Order 13771 accounting, the
Agencies multiplied the annual cost-savings ($3,080) for DOL by the
GDP deflator (0.9582) to convert the cost savings to 2016 dollars
($2,951). Assuming the rule takes effect in 2020, we divided $2,951
by (1.07)\4\, which equals $2,251. The Agencies used this result to
determine the perpetual annualized cost ($2,251) at a 7 percent
discount rate in 2016 dollars.
Table 2--The Cost Savings of the Removal of the Notice Requirements by Agency
----------------------------------------------------------------------------------------------------------------
Perpetual
Annual cost Total annualized
savings of the annualized cost savings
Agency removal of the cost savings at a 7 percent
notice at a 7 percent discounting
requirements discounting (in 2016
(C) dollars)
----------------------------------------------------------------------------------------------------------------
DOL............................................................. $3,080 $3,080 $2,251
HHS............................................................. 26,180 26,180 19,137
DHS............................................................. 6,600 6,600 4,824
USDA............................................................ 3,520 3,520 2,573
DOJ............................................................. 14,740 14,740 10,775
HUD............................................................. 0 0 0
USAID........................................................... 0 0 0
VA.............................................................. 7,480 7,480 5,467
ED.............................................................. 198,880 198,880 145,382
-----------------------------------------------
Total....................................................... .............. 260,480 190,409
----------------------------------------------------------------------------------------------------------------
3. Benefits
In terms of benefits, the Agencies recognize a non-quantified
benefit to religious liberty that comes from removing requirements
imposed solely on faith-based organizations, in tension with the
principles of free exercise articulated in Trinity Lutheran. The
Agencies also recognize a non-quantified benefit to grant recipients
and beneficiaries alike that comes from increased clarity in the
regulatory requirements that apply to faith-based organizations
operating social service programs funded by the Federal Government.
Beneficiaries will also benefit from the increased capacity of faith-
based social service providers to provide services, both because these
providers will be able to shift resources--even if only minimal--
otherwise spent fulfilling the notice-and-referral requirements to
provision of services, and because more faith-based social service
providers may participate in Federal programs under these regulations.
B. Regulatory Flexibility Analysis
The Regulatory Flexibility Act of 1980 (``RFA''), 5 U.S.C. 601 et
seq., as amended by the Small Business Regulatory Enforcement Fairness
Act of 1996, Public Law 104-121, tit. II, 110 Stat. 847, 857, requires
Federal agencies engaged in rulemaking to consider the impact of their
proposals on small entities, consider alternatives to minimize that
impact, and solicit public comment on their analyses. The RFA requires
the assessment of the impact of a regulation on a wide range of small
entities, including small businesses, not-for-profit organizations, and
small governmental jurisdictions. Agencies must perform a review to
determine whether a proposed or final rule would have a significant
economic impact on a substantial number of small entities. 5 U.S.C.
603-05.
The Agencies believe that the estimated cost savings of $220 per
provider per year is far less than one percent of annual revenue of
even the smallest faith-based organizations. The Agencies therefore
certify that this final rule will not have a significant economic
impact on a substantial number of small entities.
[[Page 82124]]
C. Civil Justice Reform (Executive Order 12988)
This final rule has been reviewed in accordance with Executive
Order 12988 of February 5, 1996, Civil Justice Reform, 61 FR 4729. The
provisions of this rule will not have preemptive effect with respect to
any State or local laws, regulations, or policies that conflict with
such provisions or which otherwise impede their full implementation.
The rule will not have retroactive effect.
D. Consultation and Coordination With Indian Tribal Governments
(Executive Order 13175)
In accordance with Executive Order 13175 of November 6, 2000,
Consultation and Coordination With Indian Tribal Governments, 65 FR
67249, HUD consulted with representatives of tribal governments
concerning the subject of this rule. HUD, through a letter dated July
16, 2019, provided Indian tribes and Alaska Native Villages the
opportunity to comment on the substance of the regulatory changes
during the development of the proposed rule. HUD received one comment
in response to those letters, regarding the ability of faith-based
organizations to access funds designated for Indian tribes under the
Indian Community Development Block Grant program. Additionally, the
February 13, 2020, proposed rule provided Indian tribes with an
additional opportunity to comment on the proposed regulatory changes.
The other Agencies have assessed the impact of their provisions in
this rule on Indian tribes and determined that those provision do not,
to their knowledge, have tribal implications that require tribal
consultation under Executive Order 13175.
E. Federalism (Executive Order 13132)
Executive Order 13132 directs that, to the extent practicable and
permitted by law, an agency shall not promulgate any regulation that
has federalism implications, that imposes substantial direct compliance
costs on State and local governments, and that is not required by
statute, or that preempts State law, unless the agency meets the
consultation and funding requirements of section 6 of the Executive
Order. Because each change in this rule does not have federalism
implications as defined in the Executive Order, does not impose direct
compliance costs on State and local governments, and does not preempt
State law within the meaning of the Executive Order, the Agencies have
concluded that compliance with the requirements of section 6 is not
necessary.
F. Reducing Regulation and Controlling Regulatory Costs (Executive
Order 13771)
Section 2(a) of Executive Order 13771 requires an agency, unless
prohibited by law, to identify at least two existing regulations to be
repealed when the agency publicly proposes for notice and comment, or
otherwise promulgates, a new regulation. In furtherance of this
requirement, section 2(c) of Executive Order 13771 requires that the
new incremental costs associated with new regulations shall, to the
extent permitted by law, be offset by the elimination of existing costs
associated with at least two prior regulations. This rule is considered
to be a deregulatory action under that order.
G. Paperwork Reduction Act
This rule does not contain any new or revised ``collection[s] of
information'' as defined by the Paperwork Reduction Act of 1995, 44
U.S.C. 3501 et seq.
H. Unfunded Mandates Reform Act
Section 4(1) and (2) of UMRA, 2 U.S.C. 1503(1)-(2), excludes from
coverage under that Act any proposed or final Federal regulation that
``enforces constitutional rights'' or ``establishes or enforces any
statutory rights that prohibit discrimination on the basis of race,
color, religion, sex, national origin, age, handicap, or disability.''
Alternatively, this final rule would not qualify as an ``unfunded''
mandate because the requirements in this final rule apply exclusively
in the context of Federal financial assistance, so most, if not all,
mandates are funded. The rule in any event will not require
expenditures by State, local, or tribal governments of $100 million or
more per year. Accordingly, this rulemaking is not subject to the
provisions of UMRA.
Final Regulations
List of Subjects
2 CFR Part 3474
Accounting, Administrative practice and procedure, Adult education,
Aged, Agriculture, American Samoa, Bilingual education, Blind, Business
and industry, Civil rights, Colleges and universities, Communications,
Community development, Community facilities, Copyright, Credit,
Cultural exchange programs, Educational facilities, Educational
research, Education, Education of disadvantaged, Education of
individuals with disabilities, Educational study programs, Electric
power, Electric power rates, Electric utilities, Elementary and
secondary education, Energy conservation, Equal educational
opportunity, federally affected areas, Government contracts, Grant
programs, Grant programs--agriculture, Grant programs--business and
industry, Grant programs--communications, Grant programs--education,
Grant programs--energy, Grant programs--health, Grant programs--housing
and community development, Grant programs--social programs, Grant
administration, Guam, Home improvement, Homeless, Hospitals, Housing,
Human research subjects, Indians, Indians--education, Infants and
children, Insurance, Intergovernmental relations, International
organizations, Inventions and patents, Loan programs, Loan programs--
social programs, Loan programs--agriculture, Loan programs--business
and industry, Loan programs--communications, Loan programs--energy,
Loan programs--health, Loan programs--housing and community
development, Manpower training programs, Migrant labor, Mortgage
insurance, Nonprofit organizations, Northern Mariana Islands, Pacific
Islands Trust Territories, Privacy, Renewable Energy, Reporting and
recordkeeping requirements, Rural areas, Scholarships and fellowships,
School construction, Schools, Science and technology, Securities, Small
businesses, State and local governments, Student aid, Teachers,
Telecommunications, Telephone, Urban areas, Veterans, Virgin Islands,
Vocational education, Vocational rehabilitation, Waste treatment and
disposal, Water pollution control, Water resources, Water supply,
Watersheds, Women.
6 CFR Part 19
Civil rights, Government contracts, Grant programs, Nonprofit
organizations, Reporting and recordkeeping requirements.
7 CFR Part 16
Administrative practice and procedure, Grant programs.
22 CFR Part 205
Foreign aid, Grant programs, Nonprofit organizations.
24 CFR Part 5
Administrative practice and procedure, Aged, Claims, Crime,
Government contracts, Grant programs--housing and community
development, Individuals with disabilities, Intergovernmental
relations, Loan programs--housing and
[[Page 82125]]
community development, Low and moderate income housing, Mortgage
insurance, Penalties, Pets, Public housing, Rent subsidies, Reporting
and recordkeeping requirements, Social security, Unemployment
compensation, Wages.
24 CFR Part 92
Administrative practice and procedure, Aged, Claims, Crime,
Government contracts, Grant programs--housing and community
development, Individuals with disabilities, Intergovernmental
relations, Loan programs--housing and community development, Low and
moderate income housing, Mortgage insurance, Penalties, Pets, Public
housing, Rent subsidies, Reporting and recordkeeping requirements,
Social security, Unemployment compensation, Wages.
24 CFR Part 578
Community facilities, Continuum of Care, Emergency solutions
grants, Grant programs--housing and community development, Grant
programs--social programs, Homeless, Rural housing, Reporting and
recordkeeping requirements, Supportive housing programs--housing and
community development, Supportive services.
28 CFR Part 38
Administrative practice and procedure, Grant programs, Reporting
and recordkeeping requirements, Nonprofit organizations.
29 CFR Part 2
Administrative practice and procedure, Claims, Courts, Government
employees, Religious discrimination.
34 CFR Part 75
Accounting, Copyright, Education, Grant programs--education,
Inventions and patents, Private schools, Reporting and recordkeeping
requirements.
34 CFR Part 76
Accounting, Administrative practice and procedure, American Samoa,
Education, Grant programs--education, Guam, Northern Mariana Islands,
Pacific Islands Trust Territory, Prisons, Private schools, Reporting
and recordkeeping requirements, Virgin Islands.
38 CFR Part 50
Administrative practice and procedure, Alcohol abuse, Alcoholism,
Day care, Dental health, Drug abuse, Government contracts, Grant
programs--health, Grant programs--veterans, Health care, Health
facilities, Health professions, Health records, Homeless, Mental health
programs, Per-diem program, Reporting and recordkeeping requirements,
Travel and transportation expenses, Veterans.
38 CFR Part 61
Administrative practice and procedure, Alcohol abuse, Alcoholism,
Day care, Dental health, Drug abuse, Government contracts, Grant
programs--health, Grant programs--veterans, Health care, Health
facilities, Health professions, Health records, Homeless, Mental health
programs, Reporting and recordkeeping requirements, Travel and
transportation expenses, Veterans.
38 CFR Part 62
Administrative practice and procedure, Day care, Disability
benefits, Government contracts, Grant programs--health, Grant
programs--housing and community development, Grant programs--Veterans,
Health care, Homeless, Housing, Indians--lands, Individuals with
disabilities, Low and moderate income housing, Manpower training
programs, Medicaid, Medicare, Public assistance programs, Public
housing, Relocation assistance, Rent subsidies, Reporting and
recordkeeping requirements, Rural areas, Social security, Supplemental
Security Income (SSI), Travel and transportation expenses, Unemployment
compensation.
45 CFR Part 87
Administrative practice and procedure, Grant programs--social
programs, Nonprofit organizations, Public assistance programs.
45 CFR Part 1050
Grant programs--social programs.
DEPARTMENT OF EDUCATION
For the reasons discussed in the preamble, the Secretary of
Education amends part 3474 of title 2 of the Code of Federal
Regulations (CFR) and parts 75 and 76 of title 34 of the CFR,
respectively, as follows:
Title II--Grants and Agreements
PART 3474--UNIFORM ADMINISTRATIVE REQUIREMENTS, COST PRINCIPLES,
AND AUDIT REQUIREMENTS FOR FEDERAL AWARDS
0
1. The authority citation for part 3474 is revised to read as follows:
Authority: 20 U.S.C. 1221e-3, 3474; 42 U.S.C. 2000bb et seq.;
and 2 CFR part 200, unless otherwise noted.
0
2. Section 3474.15 is revised to read as follows:
Sec. 3474.15 Contracting with faith-based organizations and
nondiscrimination.
(a) This section establishes responsibilities that grantees and
subgrantees have in selecting contractors to provide direct Federal
services under a program of the Department. Grantees and subgrantees
must ensure compliance by their subgrantees with the provisions of this
section and any implementing regulations or guidance.
(b)(1) A faith-based organization is eligible to contract with
grantees and subgrantees, including States, on the same basis as any
other private organization, with respect to contracts for which such
organizations are eligible and considering any permissible
accommodation.
(2) In selecting providers of goods and services, grantees and
subgrantees, including States, must not discriminate for or against a
private organization on the basis of the organization's religious
character, affiliation, or exercise, as defined in 34 CFR 75.52(c)(3)
and 76.52(c)(3), and must ensure that the award of contracts is free
from political interference, or even the appearance of such
interference, and is done on the basis of merit, not on the basis of
religion or religious belief, or lack thereof. Notices or announcements
of award opportunities and notices of award or contracts shall include
language substantially similar to that in appendices A and B,
respectively, to 34 CFR part 75.
(3) No grant document, agreement, covenant, memorandum of
understanding, policy, or regulation that is used by a grantee or
subgrantee in administering Federal financial services from the
Department shall require faith-based organizations to provide
assurances or notices where they are not required of non-faith-based
organizations. Any restrictions on the use of grant funds shall apply
equally to faith-based and non-faith-based organizations. All
organizations that participate in Department programs or services,
including organizations with religious character or affiliation, must
carry out eligible activities in accordance with all program
requirements, subject to any required or appropriate religious
accommodation, and other applicable requirements governing the conduct
of Department-funded activities, including those prohibiting the use of
direct financial assistance to engage in explicitly religious
activities.
[[Page 82126]]
(4) No grant document, agreement, covenant, memorandum of
understanding, policy, or regulation that is used by a grantee or
subgrantee shall disqualify faith-based organizations from
participating in Department-funded programs or services because such
organizations are motivated or influenced by religious faith to provide
social services, or because of their religious character or
affiliation, or on grounds that discriminate against organizations on
the basis of the organizations' religious exercise, as defined in 34
CFR 75.52(c)(3) and 76.52(c)(3).
(c)(1) The provisions of 34 CFR 75.532 and 76.532 that apply to a
faith-based organization that is a grantee or subgrantee also apply to
a faith-based organization that contracts with a grantee or subgrantee,
including a State.
(2) The requirements referenced under paragraph (c)(1) of this
section do not apply to a faith-based organization that provides goods
or services to a beneficiary under a program supported only by indirect
Federal financial assistance, as defined in 34 CFR 75.52(c)(3) and
76.52(c)(3).
(d)(1) A private organization that provides direct Federal services
under a program of the Department and engages in explicitly religious
activities, such as worship, religious instruction, or proselytization,
must offer those activities separately in time or location from any
programs or services funded by the Department through a contract with a
grantee or subgrantee, including a State. Attendance or participation
in any such explicitly religious activities by beneficiaries of the
programs and services supported by the contract must be voluntary.
(2) The limitations on explicitly religious activities under
paragraph (d)(1) of this section do not apply to a faith-based
organization that provides services to a beneficiary under a program
supported only by indirect Federal financial assistance, as defined in
34 CFR 75.52(c)(3) and 76.52(c)(3).
(e)(1) A faith-based organization that contracts with a grantee or
subgrantee, including a State, will retain its independence, autonomy,
right of expression, religious character, and authority over its
governance. A faith-based organization that receives Federal financial
assistance from the Department does not lose the protections of law.
Note 1 to paragraph (e)(1): Memorandum for All Executive
Departments and Agencies, From the Attorney General, ``Federal Law
Protections for Religious Liberty'' (Oct. 6, 2017) (describing
Federal law protections for religious liberty).
(2) A faith-based organization that contracts with a grantee or
subgrantee, including a State, may, among other things--
(i) Retain religious terms in its name;
(ii) Continue to carry out its mission, including the definition,
development, practice, and expression of its religious beliefs;
(iii) Use its facilities to provide services without concealing,
removing, or altering religious art, icons, scriptures, or other
symbols from these facilities;
(iv) Select its board members on the basis of their acceptance of
or adherence to the religious tenets of the organization; and
(v) Include religious references in its mission statement and other
chartering or governing documents.
(f) A private organization that contracts with a grantee or
subgrantee, including a State, may not discriminate against a
beneficiary or prospective beneficiary in the provision of program
goods or services on the basis of religion or religious belief, a
refusal to hold a religious belief, or refusal to attend or participate
in a religious practice. However, an organization that participates in
a program funded by indirect financial assistance need not modify its
program activities to accommodate a beneficiary who chooses to expend
the indirect aid on the organization's program and may require
attendance at all activities that are fundamental to the program.
(g) A religious organization's exemption from the Federal
prohibition on employment discrimination on the basis of religion, in
section 702(a) of the Civil Rights Act of 1964, 42 U.S.C. 2000e-1(a),
is not forfeited when the organization contracts with a grantee or
subgrantee. An organization qualifying for such an exemption may select
its employees on the basis of their acceptance of or adherence to the
religious tenets of the organization.
(h) No grantee or subgrantee receiving funds under any Department
program or service shall construe these provisions in such a way as to
advantage or disadvantage faith-based organizations affiliated with
historic or well-established religions or sects in comparison with
other religions or sects.
0
3. Section 3474.21 is added to read as follows:
Sec. 3474.21 Severability.
If any provision of this part or its application to any person,
act, or practice is held invalid, the remainder of the part or the
application of its provisions to any person, act, or practice shall not
be affected thereby.
Title 34--Education
PART 75--DIRECT GRANT PROGRAMS
0
4. The authority citation for part 75 continues to read as follows:
Authority: 20 U.S.C. 1221e-3 and 3474, unless otherwise noted.
0
5. Section 75.51 is amended by revising paragraphs (b)(3) and (4),
adding paragraph (b)(5), and removing the parenthetical authority
citation at the end of the section to read as follows:
Sec. 75.51 How to prove nonprofit status.
* * * * *
(b) * * *
(3) A certified copy of the applicant's certificate of
incorporation or similar document if it clearly establishes the
nonprofit status of the applicant;
(4) Any item described in paragraphs (b)(1) through (3) of this
section if that item applies to a State or national parent
organization, together with a statement by the State or parent
organization that the applicant is a local nonprofit affiliate; or
(5) For an entity that holds a sincerely held religious belief that
it cannot apply for a determination as an entity that is tax-exempt
under section 501(c)(3) of the Internal Revenue Code, evidence
sufficient to establish that the entity would otherwise qualify as a
nonprofit organization under paragraphs (b)(1) through (4) of this
section.
0
6. Section 75.52 is revised to read as follows:
Sec. 75.52 Eligibility of faith-based organizations for a grant and
nondiscrimination against those organizations.
(a)(1) A faith-based organization is eligible to apply for and to
receive a grant under a program of the Department on the same basis as
any other organization, with respect to programs for which such other
organizations are eligible and considering any permissible
accommodation. The Department shall provide such religious
accommodation as is consistent with Federal law, the Attorney General's
Memorandum of October 6, 2017 (Federal Law Protections for Religious
Liberty), and the Religion Clauses of the First Amendment to the U.S.
Constitution.
(2) In the selection of grantees, the Department may not
discriminate for or against a private organization on the basis of the
organization's religious character, affiliation, or exercise and must
ensure that all decisions about grant awards are free from political
interference, or even the appearance of
[[Page 82127]]
such interference, and are made on the basis of merit, not on the basis
of religion or religious belief, or the lack thereof. Notices or
announcements of award opportunities and notices of award or contracts
shall include language substantially similar to that in appendices A
and B, respectively, to this part.
(3) No grant document, agreement, covenant, memorandum of
understanding, policy, or regulation that is used by the Department
shall require faith-based organizations to provide assurances or
notices where they are not required of non-faith-based organizations.
Any restrictions on the use of grant funds shall apply equally to
faith-based and non-faith-based organizations. All organizations that
receive grants under a program of the Department, including
organizations with religious character or affiliation, must carry out
eligible activities in accordance with all program requirements,
subject to any required or appropriate religious accommodation, and
other applicable requirements governing the conduct of Department-
funded activities, including those prohibiting the use of direct
financial assistance to engage in explicitly religious activities.
(4) No grant document, agreement, covenant, memorandum of
understanding, policy, or regulation that is used by the Department
shall disqualify faith-based organizations from applying for or
receiving grants under a program of the Department because such
organizations are motivated or influenced by religious faith to provide
social services, or because of their religious character or
affiliation, or on grounds that discriminate against organizations on
the basis of the organizations' religious exercise.
(b) The provisions of Sec. 75.532 apply to a faith-based
organization that receives a grant under a program of the Department.
(c)(1) A private organization that applies for and receives a grant
under a program of the Department and engages in explicitly religious
activities, such as worship, religious instruction, or proselytization,
must offer those activities separately in time or location from any
programs or services funded by a grant from the Department. Attendance
or participation in any such explicitly religious activities by
beneficiaries of the programs and services funded by the grant must be
voluntary.
(2) The limitations on explicitly religious activities under
paragraph (c)(1) of this section do not apply to a faith-based
organization that provides services to a beneficiary under a program
supported only by ``indirect Federal financial assistance.''
(3) For purposes of 2 CFR 3474.15, this section, Sec. 75.714, and
appendices A and B to this part, the following definitions apply:
(i) Direct Federal financial assistance means financial assistance
received by an entity selected by the Government or a pass-through
entity (under this part) to carry out a service (e.g., by contract,
grant, or cooperative agreement). References to Federal financial
assistance will be deemed to be references to direct Federal financial
assistance, unless the referenced assistance meets the definition of
indirect Federal financial assistance.
(ii) Indirect Federal financial assistance means financial
assistance received by a service provider when the service provider is
paid for services rendered by means of a voucher, certificate, or other
similar means of government-funded payment provided to a beneficiary
who is able to make a choice of a service provider. Federal financial
assistance provided to an organization is indirect under this
definition if--
(A) The government program through which the beneficiary receives
the voucher, certificate, or other similar means of government-funded
payment is neutral toward religion; and
(B) The organization receives the assistance as the result of the
genuine, independent choice of the beneficiary.
(iii) Federal financial assistance does not include a tax credit,
deduction, exemption, guaranty contract, or the use of any assistance
by any individual who is the ultimate beneficiary under any such
program.
(iv) Pass-through entity means an entity, including a nonprofit or
nongovernmental organization, acting under a contract, grant, or other
agreement with the Federal Government or with a State or local
government, such as a State administering agency, that accepts direct
Federal financial assistance as a primary recipient or grantee and
distributes that assistance to other organizations that, in turn,
provide government-funded social services.
(v) Religious exercise has the meaning given to the term in 42
U.S.C. 2000cc-5(7)(A).
(vi) Discriminate against an organization on the basis of the
organization's religious exercise means to disfavor an organization,
including by failing to select an organization, disqualifying an
organization, or imposing any condition or selection criterion that
otherwise disfavors or penalizes an organization in the selection
process or has such an effect because of:
(A) Conduct that would not be considered grounds to disfavor a
secular organization,
(B) Conduct that must or could be granted an appropriate
accommodation in a manner consistent with RFRA (42 U.S.C. 2000bb
through 2000bb-4) or the Religion Clauses of the First Amendment to the
Constitution, or
(C) The actual or suspected religious motivation of the
organization's religious exercise.
Note 1 to paragraph (c)(3): The definitions of direct Federal
financial assistance and indirect Federal financial assistance do
not change the extent to which an organization is considered a
recipient of Federal financial assistance as those terms are defined
under 34 CFR parts 100, 104, 106, and 110.
(d)(1) A faith-based organization that applies for or receives a
grant under a program of the Department will retain its independence,
autonomy, right of expression, religious character, and authority over
its governance. A faith-based organization that receives Federal
financial assistance from the Department does not lose the protections
of law.
Note 1 to paragraph (d)(1): Memorandum for All Executive
Departments and Agencies, From the Attorney General, ``Federal Law
Protections for Religious Liberty'' (Oct. 6, 2017) (describing
Federal law protections for religious liberty).
(2) A faith-based organization that applies for or receives a grant
under a program of the Department may, among other things--
(i) Retain religious terms in its name;
(ii) Continue to carry out its mission, including the definition,
development, practice, and expression of its religious beliefs;
(iii) Use its facilities to provide services without concealing,
removing, or altering religious art, icons, scriptures, or other
symbols from these facilities;
(iv) Select its board members and employees on the basis of their
acceptance of or adherence to the religious tenets of the organization;
and
(v) Include religious references in its mission statement and other
chartering or governing documents.
(e) An organization that receives any Federal financial assistance
under a program of the Department shall not discriminate against a
beneficiary or prospective beneficiary in the provision of program
services or in outreach activities on the basis of religion or
religious belief, a refusal to hold a
[[Page 82128]]
religious belief, or refusal to attend or participate in a religious
practice. However, an organization that participates in a program
funded by indirect Federal financial assistance need not modify its
program activities to accommodate a beneficiary who chooses to expend
the indirect aid on the organization's program and may require
attendance at all activities that are fundamental to the program.
(f) If a grantee contributes its own funds in excess of those funds
required by a matching or grant agreement to supplement federally
funded activities, the grantee has the option to segregate those
additional funds or commingle them with the funds required by the
matching requirements or grant agreement. However, if the additional
funds are commingled, this section applies to all of the commingled
funds.
(g) A religious organization's exemption from the Federal
prohibition on employment discrimination on the basis of religion, in
section 702(a) of the Civil Rights Act of 1964, 42 U.S.C. 2000e-1, is
not forfeited when the organization receives financial assistance from
the Department. An organization qualifying for such exemption may
select its employees on the basis of their acceptance of or adherence
to the religious tenets of the organization.
(h) The Department shall not construe these provisions in such a
way as to advantage or disadvantage faith-based organizations
affiliated with historic or well-established religions or sects in
comparison with other religions or sects.
0
7. Section 75.63 is added to read as follows:
Sec. 75.63 Severability.
If any provision of this subpart or its application to any person,
act, or practice is held invalid, the remainder of the subpart or the
application of its provisions to any person, act, or practice shall not
be affected thereby.
Sec. 75.712 [Removed and Reserved]
0
8. Section 75.712 is removed and reserved.
Sec. 75.713 [Removed and Reserved]
0
9. Section 75.713 is removed and reserved.
0
10. Section 75.714 is revised to read as follows:
Sec. 75.714 Subgrants, contracts, and other agreements with faith-
based organizations.
If a grantee under a discretionary grant program of the Department
has the authority under the grant to select a private organization to
provide services supported by direct Federal financial assistance under
the program by subgrant, contract, or other agreement, the grantee must
ensure compliance with applicable Federal requirements governing
contracts, grants, and other agreements with faith-based organizations,
including, as applicable, Sec. Sec. 75.52 and 75.532, appendices A and
B to this part, and 2 CFR 3474.15. If the pass-through entity is a
nongovernmental organization, it retains all other rights of a
nongovernmental organization under the program's statutory and
regulatory provisions.
0
11. Appendix A to part 75 is revised to read as follows:
Appendix A to Part 75--Notice or Announcement of Award Opportunities
(a) Faith-based organizations may apply for this award on the
same basis as any other organization, as set forth at, and subject
to the protections and requirements of, this part and 42 U.S.C.
2000bb et seq. The Department will not, in the selection of
recipients, discriminate against an organization on the basis of the
organization's religious character, affiliation, or exercise.
(b) A faith-based organization that participates in this program
will retain its independence from the Government and may continue to
carry out its mission consistent with religious freedom and
conscience protections in Federal law, including the Free Speech and
Free Exercise Clauses of the Constitution, 42 U.S.C. 2000bb et seq.,
238n, 18113, 2000e-1(a) and 2000e-2(e), and 12113(d), and the Weldon
Amendment, among others. Religious accommodations may also be sought
under many of these religious freedom and conscience protection
laws.
(c) A faith-based organization may not use direct financial
assistance from the Department in contravention of the Establishment
Clause or any other applicable requirements. Such an organization
also may not, in providing services funded by the Department,
discriminate against a program beneficiary or prospective program
beneficiary on the basis of religion, a religious belief, a refusal
to hold a religious belief, or a refusal to attend or participate in
a religious practice.
0
12. Appendix B to part 75 is added to read as follows:
Appendix B to Part 75--Notice of Award or Contract
(a) A faith-based organization that participates in this program
retains its independence from the Government and may continue to
carry out its mission consistent with religious freedom and
conscience protections in Federal law, including the Free Speech and
Free Exercise Clauses of the Constitution, 42 U.S.C. 2000bb et seq.,
238n, 18113, 2000e-1(a) and 2000e-2(e), and 12113(d), and the Weldon
Amendment, among others. Religious accommodations may also be sought
under many of these religious freedom and conscience protection
laws.
(b) A faith-based organization may not use direct financial
assistance from the Department in contravention of the Establishment
Clause or any other applicable requirements. Such an organization
also may not, in providing services funded by the Department,
discriminate against a program beneficiary or prospective program
beneficiary on the basis of religion, a religious belief, a refusal
to hold a religious belief, or a refusal to attend or participate in
a religious practice.
PART 76--STATE-ADMINISTERED FORMULA GRANT PROGRAMS
0
13. The authority citation for part 76 continues to read as follows:
Authority: 20 U.S.C. 1221e-3 and 3474, unless otherwise noted.
0
14. Section 76.52 is revised to read as follows:
Sec. 76.52 Eligibility of faith-based organizations for a subgrant
and nondiscrimination against those organizations.
(a)(1) A faith-based organization is eligible to apply for and to
receive a subgrant under a program of the Department on the same basis
as any other private organization, with respect to programs for which
such other organizations are eligible and considering any permissible
accommodation. A State pass-through entity shall provide such religious
accommodation as would be required to a recipient under Federal law,
the Attorney General's Memorandum of October 6, 2017 (Federal Law
Protections for Religious Liberty), and the Religion Clauses of the
First Amendment to the U.S. Constitution.
(2) In the selection of subgrantees and contractors, States may not
discriminate for or against a private organization on the basis of the
organization's religious character, affiliation, or exercise and must
ensure that all decisions about subgrants are free from political
interference, or even the appearance of such interference, and are made
on the basis of merit, not on the basis of religion or religious
belief, or a lack thereof. Notices or announcements of award
opportunities and notices of award or contracts shall include language
substantially similar to that in appendices A and B, respectively, to
34 CFR part 75.
(3) No grant document, agreement, covenant, memorandum of
understanding, policy, or regulation that is used by States in
administering a program of the Department shall require faith-based
organizations to provide assurances or notices where they are not
required of non-faith-based organizations. Any restrictions on the
[[Page 82129]]
use of subgrant funds shall apply equally to faith-based and non-faith-
based organizations. All organizations that receive a subgrant from a
State under a State-Administered Formula Grant program of the
Department, including organizations with religious character or
affiliation, must carry out eligible activities in accordance with all
program requirements, subject to any required or appropriate religious
accommodation, and other applicable requirements governing the conduct
of Department-funded activities, including those prohibiting the use of
direct financial assistance in contravention of the Establishment
Clause.
(4) No grant document, agreement, covenant, memorandum of
understanding, policy, or regulation that is used by States shall
disqualify faith-based organizations from applying for or receiving
subgrants under a State-Administered Formula Grant program of the
Department because such organizations are motivated or influenced by
religious faith to provide social services, or because of their
religious character or affiliation, or on grounds that discriminate
against organizations on the basis of the organizations' religious
exercise.
(b) The provisions of Sec. 76.532 apply to a faith-based
organization that receives a subgrant from a State under a State-
Administered Formula Grant program of the Department.
(c)(1) A private organization that applies for and receives a
subgrant under a program of the Department and engages in explicitly
religious activities, such as worship, religious instruction, or
proselytization, must offer those activities separately in time or
location from any programs or services funded by a subgrant from a
State under a State-Administered Formula Grant program of the
Department. Attendance or participation in any such explicitly
religious activities by beneficiaries of the programs and services
supported by the subgrant must be voluntary.
(2) The limitations on explicitly religious activities under
paragraph (c)(1) of this section do not apply to a faith-based
organization that provides services to a beneficiary under a program
supported only by ``indirect Federal financial assistance.''
(3) For purposes of 2 CFR 3474.15, this section, and Sec. 76.714,
the following definitions apply:
(i) Direct Federal financial assistance means financial assistance
received by an entity selected by the Government or a pass-through
entity (under this part) to carry out a service (e.g., by contract,
grant, or cooperative agreement). References to ``Federal financial
assistance'' will be deemed to be references to direct Federal
financial assistance, unless the referenced assistance meets the
definition of ``indirect Federal financial assistance.''
(ii) Indirect Federal financial assistance means financial
assistance received by a service provider when the service provider is
paid for services rendered by means of a voucher, certificate, or other
means of government-funded payment provided to a beneficiary who is
able to make a choice of service provider. Federal financial assistance
provided to an organization is indirect under this definition if--
(A) The government program through which the beneficiary receives
the voucher, certificate, or other similar means of government-funded
payment is neutral toward religion; and
(B) The organization receives the assistance as the result of the
genuine, independent choice of the beneficiary.
(iii) Federal financial assistance does not include a tax credit,
deduction, exemption, guaranty contract, or the use of any assistance
by any individual who is the ultimate beneficiary under any such
program.
(iv) Pass-through entity means an entity, including a nonprofit or
nongovernmental organization, acting under a contract, grant, or other
agreement with the Federal Government or with a State or local
government, such as a State administering agency, that accepts direct
Federal financial assistance as a primary recipient or grantee and
distributes that assistance to other organizations that, in turn,
provide government-funded social services.
(v) Religious exercise has the meaning given to the term in 42
U.S.C. 2000cc-5(7)(A).
(vi) Discriminate against an organization on the basis of the
organization's religious exercise means to disfavor an organization,
including by failing to select an organization, disqualifying an
organization, or imposing any condition or selection criterion that
otherwise disfavors or penalizes an organization in the selection
process or has such an effect because of:
(A) Conduct that would not be considered grounds to disfavor a
secular organization,
(B) Conduct that must or could be granted an appropriate
accommodation in a manner consistent with RFRA (42 U.S.C. 2000bb
through 2000bb-4) or the Religion Clauses of the First Amendment to the
Constitution, or
(C) The actual or suspected religious motivation of the
organization's religious exercise.
Note 1 to paragraph (c)(3): The definitions of direct Federal
financial assistance and indirect Federal financial assistance do
not change the extent to which an organization is considered a
recipient of Federal financial assistance as those terms are defined
under 34 CFR parts 100, 104, 106, and 110.
(d)(1) A faith-based organization that applies for or receives a
subgrant from a State under a State-Administered Formula Grant program
of the Department will retain its independence, autonomy, right of
expression, religious character, and authority over its governance. A
faith-based organization that receives Federal financial assistance
from the Department does not lose the protection of law.
Note 1 to paragraph (d)(1): Memorandum for All Executive
Departments and Agencies, From the Attorney General, ``Federal Law
Protections for Religious Liberty'' (Oct. 6, 2017) (describing
Federal law protections for religious liberty).
(2) A faith-based organization that applies for or receives a
subgrant from a State under a State-Administered Formula Grant program
of the Department may, among other things--
(i) Retain religious terms in its name;
(ii) Continue to carry out its mission, including the definition,
development, practice, and expression of its religious beliefs;
(iii) Use its facilities to provide services without concealing,
removing, or altering religious art, icons, scriptures, or other
symbols from these facilities;
(iv) Select its board members and employees on the basis of their
acceptance of or adherence to the religious tenets of the organization;
and
(v) Include religious references in its mission statement and other
chartering or governing documents.
(e) An organization that receives any Federal financial assistance
under a program of the Department shall not discriminate against a
beneficiary or prospective beneficiary in the provision of program
services or in outreach activities on the basis of religion or
religious belief, a refusal to hold a religious belief, or refusal to
attend or participate in a religious practice. However, an organization
that participates in a program funded by indirect financial assistance
need not modify its program activities to accommodate a beneficiary who
chooses to expend the indirect aid on the organization's program and
may require attendance at all activities that are fundamental to the
program.
[[Page 82130]]
(f) If a State or subgrantee contributes its own funds in excess of
those funds required by a matching or grant agreement to supplement
federally funded activities, the State or subgrantee has the option to
segregate those additional funds or commingle them with the funds
required by the matching requirements or grant agreement. However, if
the additional funds are commingled, this section applies to all of the
commingled funds.
(g) A religious organization's exemption from the Federal
prohibition on employment discrimination on the basis of religion, in
section 702(a) of the Civil Rights Act of 1964, 42 U.S.C. 2000e-1, is
not forfeited when the organization receives Federal financial
assistance from the Department. An organization qualifying for such
exemption may select its employees on the basis of their acceptance of
or adherence to the religious tenets of the organization.
(h) The Department shall not construe these provisions in such a
way as to advantage or disadvantage faith-based organizations
affiliated with historic or well-established religions or sects in
comparison with other religions or sects.
0
15. Section 76.53 is added to subpart A to read as follows:
Sec. 76.53 Severability.
If any provision of this subpart or its application to any person,
act, or practice is held invalid, the remainder of the subpart or the
application of its provisions to any person, act, or practice shall not
be affected thereby.
Sec. 76.712 [Removed and Reserved]
0
16. Section 76.712 is removed and reserved.
Sec. 76.713 [Removed and Reserved]
0
17. Section 76.713 is removed and reserved.
0
18. Section 76.714 is revised to read as follows:
Sec. 76.714 Subgrants, contracts, and other agreements with faith-
based organizations.
If a grantee under a State-Administered Formula Grant program of
the Department has the authority under the grant or subgrant to select
a private organization to provide services supported by direct Federal
financial assistance under the program by subgrant, contract, or other
agreement, the grantee must ensure compliance with applicable Federal
requirements governing contracts, grants, and other agreements with
faith-based organizations, including, as applicable, Sec. Sec. 76.52
and 76.532 and 2 CFR 3474.15. If the pass-through entity is a
nongovernmental organization, it retains all other rights of a
nongovernmental organization under the program's statutory and
regulatory provisions.
Department of Homeland Security
For the reasons set forth in the preamble, DHS amends part 19 of
title 6 of the CFR as follows:
PART 19--NONDISCRIMINATION IN MATTERS PERTAINING TO FAITH-BASED
ORGANIZATIONS
0
19. The authority citation for part 19 is revised to read as follows:
Authority: 5 U.S.C. 301; Pub. L. 107-296, 116 Stat. 2135 (6
U.S.C. 101 et seq.); E.O. 13279, 67 FR 77141, 3 CFR, 2002 Comp., p.
258; E.O. 13403, 71 FR 28543, 3 CFR, 2006 Comp., p. 228; E.O. 13498,
74 FR 6533, 3 CFR, 2009 Comp., p. 219; E.O. 13559, 75 FR 71319, 3
CFR, 2010 Comp., p. 273; and E.O. 13831, 83 FR 20715, 3 CFR, 2018
Comp., p. 806; 42 U.S.C. 2000bb et seq.
0
20. Amend Sec. 19.2 by:
0
a. Revising the definition of ``Direct Federal financial assistance or
Federal financial assistance provided directly'';
0
b. In the definition of ``Financial assistance,'' adding a sentence to
the end;
0
c. Revising the definition of ``Indirect Federal financial assistance
or Federal financial assistance provided indirectly''; and
0
d. Adding a definition for ``Religious exercise'' in alphabetical
order.
The revisions and addition read as follows:
Sec. 19.2 Definitions.
* * * * *
Direct Federal financial assistance or Federal financial assistance
provided directly means financial assistance received by an entity
selected by the Government or an intermediary (under this part) to
carry out a service (e.g., by contract, grant, or cooperative
agreement). References to ``Federal financial assistance'' will be
deemed to be references to direct Federal financial assistance, unless
the referenced assistance meets the definition of ``indirect Federal
financial assistance'' or ``Federal financial assistance provided
indirectly''.
* * * * *
Financial assistance * * * Financial assistance does not include a
tax credit, deduction, exemption, guaranty contract, or the use of any
assistance by any individual who is the ultimate beneficiary under any
such program.
Indirect Federal financial assistance or Federal financial
assistance provided indirectly means financial assistance received by a
service provider when the service provider is paid for services
rendered by means of a voucher, certificate, or other means of
government-funded payment provided to a beneficiary who is able to make
a choice of a service provider. Federal financial assistance provided
to an organization is considered ``indirect'' when:
(1) The government program through which the beneficiary receives
the voucher, certificate, or other similar means of government-funded
payment is neutral toward religion; and
(2) The organization receives the assistance as a result of a
genuine, independent choice of the beneficiary.
* * * * *
Religious exercise has the meaning given to the term in 42 U.S.C.
2000cc-5(7)(A).
* * * * *
0
21. Amend Sec. 19.3 by revising paragraphs (a), (b), and (e) and
adding paragraph (f) to read as follows:
Sec. 19.3 Equal ability for faith-based organizations to seek and
receive financial assistance through DHS social service programs.
(a) Faith-based organizations are eligible, on the same basis as
any other organization and considering any religious accommodations
appropriate under the Constitution or other provisions of Federal law,
including but not limited to 42 U.S.C. 2000bb et seq., 42 U.S.C. 238n,
42 U.S.C. 18113, 42 U.S.C. 2000e-1(a) and 2000e-2(e), 42 U.S.C.
12113(d), and the Weldon Amendment, to seek and receive direct
financial assistance from DHS for social service programs or to
participate in social service programs administered or financed by DHS.
(b) Neither DHS, nor a State or local government, nor any other
entity that administers any social service program supported by direct
financial assistance from DHS, shall discriminate for or against an
organization on the basis of the organization's religious motivation,
character, affiliation, or exercise. For purposes of this part, to
discriminate against an organization on the basis of the organization's
religious exercise means to disfavor an organization, including by
failing to select an organization, disqualifying an organization, or
imposing any condition or selection criterion that otherwise disfavors
or penalizes an organization in the selection process or has such an
effect:
(1) Because of conduct that would not be considered grounds to
disfavor a secular organization,
[[Page 82131]]
(2) Because of conduct that must or could be granted an appropriate
accommodation in a manner consistent with RFRA (42 U.S.C. 2000bb
through 2000bb-4) or the Religion Clauses of the First Amendment to the
Constitution; or
(3) Because of the actual or suspected religious motivation of the
organization's religious exercise.
* * * * *
(e) All organizations that participate in DHS social service
programs, including faith-based organizations, must carry out eligible
activities in accordance with all program requirements, subject to any
reasonable religious accommodation, and other applicable requirements
governing the conduct of DHS-funded activities, including those
prohibiting the use of direct financial assistance from DHS to engage
in explicitly religious activities. No grant document, agreement,
covenant, memorandum of understanding, policy, or regulation that is
used by DHS or an intermediary in administering financial assistance
from DHS shall disqualify a faith-based organization from participating
in DHS's social service programs because such organization is motivated
or influenced by religious faith to provide social services or because
of its religious character or affiliation, or on grounds that
discriminate against an organization on the basis of the organization's
religious exercise, as defined in this part.
(f) No grant document, agreement, covenant, memorandum of
understanding, policy, or regulation used by DHS or an intermediary in
administering financial assistance from DHS shall require faith-based
organizations to provide assurances or notices where they are not
required of non-faith-based organizations. Any restrictions on the use
of grant funds shall apply equally to faith-based and non-faith-based
organizations.
0
22. Amend Sec. 19.4 by revising paragraphs (b) and (c) to read as
follows:
Sec. 19.4 Explicitly religious activities.
* * * * *
(b) Organizations receiving direct financial assistance from DHS
for social service programs are free to engage in explicitly religious
activities, but such activities must be offered separately, in time or
location, from the programs or services funded with direct financial
assistance from DHS, and participation must be voluntary for
beneficiaries of the programs or services funded with such assistance.
(c) All organizations that participate in DHS social service
programs, including faith-based organizations, must carry out eligible
activities in accordance with all program requirements, subject to any
religious accommodations appropriate under the Constitution or other
provisions of Federal law, including but not limited to 42 U.S.C.
2000bb et seq., 42 U.S.C. 238n, 42 U.S.C. 18113, 42 U.S.C. 2000e-1(a)
and 2000e-2(e), 42 U.S.C. 12113(d), and the Weldon Amendment, and in
accordance with all other applicable requirements governing the conduct
of DHS-funded activities, including those prohibiting the use of direct
financial assistance from DHS to engage in explicitly religious
activities. No grant document, agreement, covenant, memorandum of
understanding, policy, or regulation that is used by DHS or a State or
local government in administering financial assistance from DHS shall
disqualify a faith-based organization from participating in DHS's
social service programs because such organization is motivated or
influenced by religious faith to provide social services or because of
its religious character or affiliation, or on grounds that discriminate
against an organization on the basis of the organization's religious
exercise, as defined in this part.
* * * * *
Sec. 19.5 [Amended]
0
23. Amend Sec. 19.5 in the last sentence by removing ``organization's
program'' and adding in its place ``organization's program and may
require attendance at all activities that are fundamental to the
program''.
0
24. Revise Sec. 19.6 to read as follows:
Sec. 19.6 How to prove nonprofit status.
In general, DHS does not require that a recipient, including a
faith-based organization, obtain tax-exempt status under section
501(c)(3) of the Internal Revenue Code to be eligible for funding under
DHS social service programs. Many grant programs, however, do require
an organization to be a nonprofit organization in order to be eligible
for funding. Funding announcements and other grant application
solicitations for social service programs that require organizations to
have nonprofit status will specifically so indicate in the eligibility
section of the solicitation. In addition, any solicitation for social
service programs that requires an organization to maintain tax-exempt
status will expressly state the statutory authority for requiring such
status. Recipients should consult with the appropriate DHS program
office to determine the scope of any applicable requirements. In DHS
social service programs in which an applicant for funding must show
that it is a nonprofit organization, the applicant may do so by any of
the following means:
(a) Proof that the Internal Revenue Service currently recognizes
the applicant as an organization to which contributions are tax
deductible under section 501(c)(3) of the Internal Revenue Code;
(b) A statement from a State or other governmental taxing body or
the State secretary of State certifying that:
(1) The organization is a nonprofit organization operating within
the State; and
(2) No part of its net earnings may benefit any private shareholder
or individual;
(c) A certified copy of the applicant's certificate of
incorporation or similar document that clearly establishes the
nonprofit status of the applicant;
(d) Any item described in paragraphs (a) through (c) of this
section if that item applies to a State or national parent
organization, together with a statement by the State or parent
organization that the applicant is a local nonprofit affiliate; or
(e) For an entity that holds a sincerely held religious belief that
it cannot apply for a determination as an entity that is tax-exempt
under section 501(c)(3) of the Internal Revenue Code, evidence
sufficient to establish that the entity would otherwise qualify as a
nonprofit organization under paragraphs (a) through (d) of this
section.
Sec. 19.7 [Removed and Reserved]
0
25. Remove and reserve Sec. 19.7.
0
26. Revise Sec. 19.8 to read as follows:
Sec. 19.8 Independence of faith-based organizations.
(a) A faith-based organization that applies for, or participates
in, a social service program supported with Federal financial
assistance will retain its autonomy; right of expression; religious
character; authority over its governance; and independence from
Federal, State, and local governments; 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 Federal financial assistance contrary to Sec. 19.4.
(b) Faith-based organizations may use space in their facilities to
provide social services using financial assistance from DHS without
removing, concealing, or altering religious articles, texts, art, or
symbols.
(c) A faith-based organization using financial assistance from DHS
for social
[[Page 82132]]
service programs retains its authority over its internal governance,
and it may retain religious terms in its organization's name, select
its board members on the basis of their acceptance of or adherence to
the religious tenets of the organization, and include religious
references in its organization's mission statements and other governing
documents.
0
27. Add Sec. 19.11 to read as follows:
Sec. 19.11 Nondiscrimination among faith-based organizations.
Neither DHS nor any State or local government or other intermediary
receiving funds under any DHS social service program shall construe
these provisions in such a way as to advantage or disadvantage faith-
based organizations affiliated with historic or well-established
religions or sects in comparison with other religions or sects.
0
28. Revise appendix A to part 19 to read as follows:
Appendix A to Part 19--Notice or Announcement of Award Opportunities
(a) Faith-based organizations may apply for this award on the
same basis as any other organization, as set forth at and subject to
the protections and requirements of this part and 42 U.S.C. 2000bb
et seq. DHS will not, in the selection of recipients, discriminate
against an organization on the basis of the organization's religious
character, affiliation, or exercise.
(b) A faith-based organization that participates in this program
will retain its independence from the Government and may continue to
carry out its mission consistent with religious freedom and
conscience protections in Federal law, including the Free Speech and
Free Exercise Clauses of the Constitution, 42 U.S.C. 2000bb et seq.,
42 U.S.C. 238n, 42 U.S.C. 18113, 42 U.S.C. 2000e-1(a) and 2000e-
2(e), 42 U.S.C. 12113(d), and the Weldon Amendment, among others.
Religious accommodations may also be sought under many of these
religious freedom and conscience protection laws.
(c) A faith-based organization may not use direct financial
assistance from DHS to support or engage in any explicitly religious
activities except where consistent with the Establishment Clause and
any other applicable requirements. Such an organization also may
not, in providing services funded by DHS, discriminate against a
program beneficiary or prospective program beneficiary on the basis
of religion, a religious belief, a refusal to hold a religious
belief, or a refusal to attend or participate in a religious
practice.
0
29. Add appendix B to part 19 to read as follows:
Appendix B to Part 19: Notice of Award or Contract
(a) A faith-based organization that participates in this program
retains its independence from the Government and may continue to
carry out its mission consistent with religious freedom and
conscience protections in Federal law, including the Free Speech and
Free Exercise Clauses of the Constitution, 42 U.S.C. 2000bb et seq.,
42 U.S.C. 238n, 42 U.S.C. 18113, 42 U.S.C. 2000e-1(a) and 2000e-
2(e), 42 U.S.C. 12113(d), and the Weldon Amendment, among others.
Religious accommodations may also be sought under many of these
religious freedom and conscience protection laws.
(b) A faith-based organization may not use direct financial
assistance from DHS to support or engage in any explicitly religious
activities except when consistent with the Establishment Clause and
any other applicable requirements. Such an organization also may
not, in providing services funded by DHS, discriminate against a
program beneficiary or prospective program beneficiary on the basis
of religion, a religious belief, a refusal to hold a religious
belief, or a refusal to attend or participate in a religious
practice.
Department of Agriculture
For the reasons set forth in the preamble, USDA amends part 16 of
title 7 of the CFR as follows:
PART 16--EQUAL OPPORTUNITY FOR RELIGIOUS ORGANIZATIONS
0
30. The authority citation for part 16 is revised to read as follows:
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;
E.O. 13559, 75 FR 71319, 3 CFR, 2010 Comp., p. 273; E.O. 13831, 83
FR 20715, 3 CFR, 2018 Comp., p. 806; 42 U.S.C. 2000bb et seq.
0
31. Amend Sec. 16.1 by redesignating paragraph (b) as paragraph (c)
and adding a new paragraph (b) to read as follows:
Sec. 16.1 Purpose and applicability.
* * * * *
(b) The requirements established in this part do not prevent a USDA
awarding agency or any State or local government or other intermediary
from accommodating religion in a manner consistent with Federal law and
the Religion Clauses of the First Amendment to the U.S. Constitution.
* * * * *
0
32. Revise Sec. 16.2 to read as follows:
Sec. 16.2 Definitions.
As used in this part:
Direct Federal financial assistance, Federal financial assistance
provided directly, Direct funding, or Directly funded means financial
assistance received by an entity selected by the Government or
intermediary (under this part) to carry out a service (e.g., by
contract, grant, loan agreement, or cooperative agreement). References
to Federal financial assistance will be deemed to be references to
direct Federal financial assistance, unless the referenced assistance
meets the definition of indirect Federal financial assistance or
Federal financial assistance provided indirectly. Except as otherwise
provided by USDA regulation, the recipients of sub-grants that receive
Federal financial assistance through State-administered programs (e.g.,
flow-through programs such as the National School Lunch Program
authorized under the Richard B. Russell National School Lunch Act, 42
U.S.C. 1751 et seq.) are not considered recipients of USDA indirect
assistance. These recipients of sub-awards are considered recipients of
USDA direct financial assistance.
Discriminate against an organization on the basis of the
organization's religious exercise means to disfavor an organization,
including by failing to select an organization, disqualifying an
organization, or imposing any condition or selection criterion that
otherwise disfavors or penalizes an organization in the selection
process or has such an effect:
(1) Because of conduct that would not be considered grounds to
disfavor a secular organization;
(2) Because of conduct that must or could be granted an appropriate
accommodation in a manner consistent with RFRA (42 U.S.C. 2000bb
through 2000bb-4) or the Religion Clauses of the First Amendment to the
Constitution; or
(3) Because of the actual or suspected religious motivation of the
organization's religious exercise.
Explicitly religious activities include activities that involve
overt religious content such as worship, religious instruction, or
proselytization. Any such activities must be offered separately, in
time or location, from the programs or services funded under the
agency's grant or cooperative agreement, and participation must be
voluntary for beneficiaries of the agency grant or cooperative
agreement-funded programs and services.
Federal financial assistance does not include a guarantee or
insurance, regulated programs, licenses, procurement contracts at
market value, or programs that provide direct benefits.
Indirect Federal financial assistance or Federal financial
assistance provided indirectly refers to situations where the choice of
the service provider is placed in the hands of the beneficiary, and the
cost of that service is paid through a voucher, certificate, or other
similar means of government-funded payment
[[Page 82133]]
in accordance with the First Amendment of the U.S. Constitution.
Intermediary means an entity, including a non-governmental
organization, acting under a contract, grant, or other agreement with
the Federal Government or with a State or local government that accepts
USDA direct assistance and distributes that assistance to other
organizations that, in turn, provide government-funded services. If an
intermediary, acting under a contract, grant, or other agreement with
the Federal Government or with a State or local government that is
administering a program supported by Federal financial assistance, is
given the authority under the contract, grant, or agreement to select
non-governmental organizations to provide services funded by the
Federal Government, the intermediary must ensure compliance by the
recipient of a contract, grant, or agreement with this part and any
implementing rules or guidance. If the intermediary is a non-
governmental organization, it retains all other rights of a non-
governmental organization under the program's statutory and regulatory
provisions.
Religious exercise has the meaning given to the term in 42 U.S.C.
2000cc-5(7)(A).
0
33. Revise Sec. 16.3 to read as follows:
Sec. 16.3 Faith-Based Organizations and Federal Financial
Assistance.
(a)(1) A faith-based or religious organization is eligible, on the
same basis as any other organization, and considering a religious
accommodation, to access and participate in any USDA assistance
programs for which it is otherwise eligible. Neither the USDA awarding
agency nor any State or local government or other intermediary
receiving funds under any USDA awarding agency program or service
shall, in the selection of service providers, discriminate against an
organization on the basis of the organization's religious character,
affiliation, or exercise.
(2) Additionally, decisions about awards of USDA direct assistance
or USDA indirect assistance must be free from political interference
and must be made on the basis of merit, not on the basis of the
religious affiliation of a recipient organization or lack thereof.
Notices or announcements of award opportunities and notices of award or
contracts shall include language substantially similar to that in
appendices A and B to this part.
(b) A faith-based or religious organization that participates in
USDA assistance programs will retain its autonomy; right of expression;
religious character; authority over its governance; and independence
from Federal, State, and local governments, 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 USDA
direct assistance to support any ineligible purposes, including
explicitly religious activities that involve overt religious content
such as worship, religious instruction, or proselytization. A faith-
based or religious organization may:
(1) Use its facilities to provide services and programs funded with
financial assistance from USDA awarding agency without concealing,
altering, or 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 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 participates
in a USDA assistance program.
(d) A faith-based or religious organization is eligible to access
and participate in USDA assistance programs on the same basis as any
other organization. No grant document, agreement, covenant, memorandum
of understanding, policy, or regulation that is used by a USDA awarding
agency or a State or local government in administering Federal
financial assistance from the USDA awarding agency shall require faith-
based or religious organizations to provide assurances or notices where
they are not required of non-religious organizations.
(1) Any restrictions on the use of grant funds shall apply equally
to religious and non-religious organizations.
(2) All organizations that participate in USDA awarding agency
programs or services, including organizations with religious character
or affiliations, must carry out eligible activities in accordance with
all program requirements and other applicable requirements governing
the conduct of USDA awarding agency-funded activities, including those
prohibiting the use of direct financial assistance to engage in
explicitly religious activities.
(3) No grant or agreement, document, loan agreement, covenant,
memorandum of understanding, policy or regulation that is used by the
USDA awarding agency or a State or local government in administering
financial assistance from the USDA awarding agency shall disqualify
faith-based or religious organizations from participating in the USDA
awarding agency's programs or services because such organizations are
motivated by or influenced by religious faith, or because of their
religious character or affiliation, or on grounds that discriminate
against organizations on the basis of the organizations' religious
exercise, as defined in this part.
(e) If an intermediary, acting under a contract, grant, or other
agreement with the Federal Government or with a State or local
government that is administering a program supported by Federal
financial assistance, is delegated the authority under the contract,
grant, or agreement to select non-governmental organizations to provide
services funded by the Federal Government, the intermediary must ensure
compliance by the subrecipient with the provisions of this part and any
implementing regulations or guidance. If the intermediary is a non-
governmental organization, it retains all other rights of a non-
governmental organization under the program's statutory and regulatory
provisions.
(f)(1) USDA direct financial assistance may be used for the
acquisition, construction, or rehabilitation of structures to the
extent authorized by the applicable program statutes and regulations.
USDA direct assistance 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 explicitly
religious activities. Where a structure is used for both eligible and
ineligible purposes, USDA direct financial assistance 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 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 2
CFR part 400).
(2) Any use of USDA direct financial assistance for equipment,
supplies,
[[Page 82134]]
labor, indirect costs, and the like shall be prorated between the USDA
program or activity and any ineligible 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 who are receiving USDA direct assistance funds
from engaging in religious exercise within such housing.
(g) If a recipient contributes its own funds in excess of those
funds required by a matching or grant agreement to supplement USDA
awarding agency supported activities, the recipient has the option to
segregate those additional funds or commingle them with the Federal
award funds. If the funds are commingled, the provisions of this
section shall apply to all of the commingled funds in the same manner,
and to the same extent, as the provisions apply to the Federal funds.
With respect to the matching funds, the provisions of this section
apply irrespective of whether such funds are commingled with Federal
funds or segregated.
0
34. Revise Sec. 16.4 to read as follows:
Sec. 16.4 Responsibilities of participating organizations.
(a) Any organization that receives direct or indirect Federal
financial assistance shall not, with respect to services, or, in the
case of direct Federal financial assistance, outreach activities funded
by such financial assistance, discriminate against a current or
prospective program beneficiary on the basis of religion, religious
belief, a refusal to hold a religious belief, or a refusal to attend or
participate in a religious practice. However, an organization that
participates in a program funded by indirect financial assistance need
not modify its program activities to accommodate a beneficiary who
chooses to expend the indirect aid on the organization's program and
may require attendance at all activities that are fundamental to the
program.
(b) Organizations that receive USDA direct assistance under any
USDA program 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 funded by USDA direct assistance. If an
organization conducts such activities, the activities must be offered
separately, in time or location, from the programs or services
supported with USDA direct assistance, and participation must be
voluntary for beneficiaries of the programs or services supported with
such USDA direct assistance. The use of indirect Federal financial
assistance is not subject to this restriction. Nothing in this part
restricts the Department's authority under applicable Federal law to
fund activities that can be directly funded by the Government
consistent with the Establishment Clause.
(c) Nothing in paragraph (a) or (b) of this section shall be
construed to prevent faith-based 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 or from imposing religious
attendance or curricular requirements at their schools.
0
35. Revise Sec. 16.5 to read as follows:
Sec. 16.5 Severability.
To the extent that any provision of this regulation is declared
invalid by a court of competent jurisdiction, USDA intends for all
other provisions that are capable of operating in the absence of the
specific provision that has been invalidated to remain in effect.
Sec. 16.6 [Removed]
0
36. Remove Sec. 16.6.
0
37. Revise appendix A to part 16 to read as follows:
Appendix A to Part 16--Notice or Announcement of Award Opportunities
(a) Faith-based organizations may apply for this award on the
same basis as any other organization, as set forth at and, subject
to the protections and requirements of this part and 42 U.S.C.
2000bb et seq., USDA will not, in the selection of recipients,
discriminate against an organization on the basis of the
organization's religious character, affiliation, or exercise.
(b) A faith-based organization that participates in this program
will retain its independence from the Government and may continue to
carry out its mission consistent with religious freedom and
conscience protections in the U.S. Constitution and Federal law,
including 42 U.S.C. 2000bb et seq., 42 U.S.C. 238n, 42 U.S.C. 18113,
42 U.S.C. 2000e-1(a) and 2000e-2(e), 42 U.S.C. 12113(d), and the
Weldon Amendment, among others. Religious accommodations may also be
sought under many of these religious freedom and conscience
protection laws.
(c) A faith-based organization may not use direct financial
assistance from USDA to support or engage in any explicitly
religious activities except where consistent with the Establishment
Clause and any other applicable requirements. Such an organization
also may not, in providing services funded by USDA, discriminate
against a program beneficiary or prospective program beneficiary on
the basis of religion, a religious belief, a refusal to hold a
religious belief, or a refusal to attend or participate in a
religious practice.
0
38. Add appendix B to part 16 to read as follows:
Appendix B to Part 16--Notice of Award or Contract
(a) A faith-based organization that participates in this program
retains its independence from the Government and may continue to
carry out its mission consistent with religious freedom and
conscience protections in the U.S. Constitution and Federal law,
including 42 U.S.C. 2000bb et seq., 42 U.S.C. 238n, 42 U.S.C. 18113,
42 U.S.C. 2000e-1(a) and 2000e-2(e), 42 U.S.C. 12113(d), and the
Weldon Amendment, among others. Religious accommodations may also be
sought under many of these religious freedom and conscience
protection laws.
(b) A faith-based organization may not use direct financial
assistance from USDA to support or engage in any explicitly
religious activities except when consistent with the Establishment
Clause and any other applicable requirements. Such an organization
also may not, in providing services funded by USDA, discriminate
against a program beneficiary or prospective program beneficiary on
the basis of religion, a religious belief, a refusal to hold a
religious belief, or a refusal to attend or participate in a
religious practice.
Agency for International Development
For the reasons set forth in the preamble, USAID amends part 205 of
title 22 of the CFR as follows:
PART 205--PARTICIPATION BY RELIGIOUS ORGANIZATIONS IN USAID
PROGRAMS
0
39. The authority citation for part 205 continues to read as follows:
Authority: 22 U.S.C. 2381(a).
0
40. In Sec. 205.1, revise paragraphs (a), (c), (f), (g) and add
paragraph (l) to read as follows:
Sec. 205.1 Grants and cooperative agreements.
(a) Faith-based organizations are eligible, on the same basis as
any other organization and considering any reasonable accommodation, as
is consistent with Federal law, the Attorney General's Memorandum of
October 6, 2018 (Federal Law Protections for Religious Liberty), and
the Religion Clauses of the First Amendment to the U.S. Constitution,
to participate in any USAID program for which they are otherwise
eligible. In the selection of service-providers, neither USAID nor
entities that make and administer sub-awards of USAID funds shall
discriminate for, or against, an organization on the basis of the
organization's religious character,
[[Page 82135]]
affiliation, or exercise. For purposes of this part, to discriminate
against an organization on the basis of the organization's religious
exercise means to disfavor an organization, including by failing to
select an organization, disqualifying an organization, or imposing any
condition or selection criterion that otherwise disfavors or penalizes
an organization in the selection process or has such an effect:
(1) Because of conduct that would not be considered grounds to
disfavor a secular organization;
(2) Because of conduct that must or could be granted an appropriate
accommodation in a manner consistent with RFRA (42 U.S.C. 2000bb
through 2000bb-4) or the Religion Clauses of the First Amendment to the
Constitution; or
(3) Because of the actual or suspected religious motivation of the
organization's religious exercise.
(4) Notices or announcements of award opportunities shall include
language to indicate that faith-based organizations are eligible on the
same basis as any other organization and subject to the protections and
requirements of Federal law. As used in this section, the term
``program'' refers to federally funded USAID grants and cooperative
agreements, including subgrants and sub-agreements. The term also
includes grants awarded under contracts. As used in this section, the
term ``grantee'' includes a recipient of a grant or a signatory to a
cooperative agreement, as well as sub-recipients of USAID assistance
under grants, cooperative agreements, and contracts.
* * * * *
(c) A faith-based organization that applies for, or participates
in, USAID-funded programs or services (including through a prime award
or sub-award) will retain its autonomy, religious character, and
independence, and may continue to carry out its mission consistent with
religious freedom protections in Federal law, 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 faith-based organization that receives financial assistance
from USAID may use space in its facilities, without concealing,
altering, or removing religious art, icons, scriptures, or other
religious symbols. In addition, a faith-based 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.
* * * * *
(f) No grant document, contract, agreement, covenant, memorandum of
understanding, policy, or regulation used by USAID shall require faith-
based organizations to provide assurances or notices where the Agency
does not require them of non-faith-based organizations. Any
restrictions on the use of grant funds shall apply equally to faith-
based and non-faith-based organizations. All organizations that
participate in USAID's programs (including through a prime award or
sub-award), including faith-based ones, must carry out eligible
activities in accordance with all program requirements and other
applicable requirements that govern the conduct of USAID-funded
activities, including those that prohibit the use of direct financial
assistance from USAID to engage in explicitly religious activities. No
grant document, contract, agreement, covenant, memorandum of
understanding, policy, or regulation used by USAID shall disqualify
faith-based organizations from participating in USAID's programs
because such organizations are motivated or influenced by religious
faith to provide social services or other assistance, or because of
their religious character or affiliation, or on grounds that
discriminate against organizations on the basis of the organizations'
religious exercise, as defined in this part.
(g) A religious organization does not forfeit its 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, when the organization receives financial assistance
from USAID. An organization that qualifies for such exemption may
select its employees on the basis of their acceptance of, and/or
adherence to, the religious tenets of the organization.
* * * * *
(l) Nothing in this section shall be construed in such a way as to
advantage, or disadvantage, faith-based organizations affiliated with
historic or well-established religions or sects in comparison with
other religions or sects.
Department of Housing and Urban Development
For the reasons set forth in the preamble, HUD amends parts 5, 92,
and 578 of title 24 of the CFR as follows:
PART 5--GENERAL HUD PROGRAM REQUIREMENTS; WAIVERS
0
41. The authority citation for part 5 is revised to read as follows:
Authority: 12 U.S.C. 1701x; 42 U.S.C. 1437a, 1437c, 1437f,
1437n, 3535(d); Sec. 327, Pub. L. 109-115, 119 Stat. 2396; Sec. 607,
Pub. L. 109-162, 119 Stat. 3051 (42 U.S.C. 14043e et seq.); E.O.
13279, 67 FR 77141, 3 CFR, 2002 Comp., p. 258; E.O. 13559, 75 FR
71319, 3 CFR, 2010 Comp., p. 273; E.O 13831, 83 FR 20715, 3 CFR,
2018 Comp., p. 806; 42 U.S.C. 2000bb et seq.
0
42. Amend Sec. 5.109 by:
0
a. Revising paragraph (a);
0
b. In paragraph (b), revising the definition of ``Indirect Federal
financial assistance'' and adding a definition for ``Religious
exercise'' in alphabetical order;
0
c. Revising paragraphs (c) and (d);
0
d. Adding a sentence to the end of paragraph (e);
0
e. Removing paragraph (g);
0
f. Redesignating paragraph (h) as paragraph (g) and revising it; and
0
g. Adding a new paragraph (h) and paragraphs (l) and (m).
The revisions and additions read as follows:
Sec. 5.109 Equal participation of faith-based organizations in HUD
programs and activities.
(a) Purpose. Consistent with Executive Order 13279, entitled
``Equal Protection of the Laws for Faith-Based and Community
Organizations,'' as amended by Executive Order 13559, entitled
``Fundamental Principles and Policymaking Criteria for Partnerships
With Faith-Based and Other Neighborhood Organizations,'' and as amended
by Executive Order 13831, entitled ``Establishment of a White House
Faith and Opportunity Initiative,'' this section describes requirements
for ensuring the equal participation of faith-based organizations in
HUD programs and activities. These requirements apply to all HUD
programs and activities, including all of HUD's Native American
Programs, except as may be otherwise noted in the respective program
regulations in title 24 of the Code of Federal Regulations (CFR), or
unless inconsistent with certain HUD program authorizing statutes.
(b) * * *
Indirect Federal financial assistance means Federal financial
assistance
[[Page 82136]]
provided when the choice of the provider is placed in the hands of the
beneficiary, and the cost of that service is paid through a voucher,
certificate, or other similar means of Government-funded payment.
Federal financial assistance provided to an organization is considered
indirect when the Government program through which the beneficiary
receives the voucher, certificate, or other similar means of
Government-funded payment is neutral toward religion meaning that it is
available to providers without regard to the religious or non-religious
nature of the institution and there are no program incentives that
deliberately skew for or against religious or secular providers; and
the organization receives the assistance as a result of a genuine,
independent choice of the beneficiary.
* * * * *
Religious exercise has the meaning given to the term in 42 U.S.C.
2000cc-5(7)(A).
(c) Equal participation of faith-based organizations in HUD
programs and activities. Faith-based organizations are eligible, on the
same basis as any other organization, to participate in any HUD program
or activity, considering any permissible accommodations, particularly
under the Religious Freedom Restoration Act. Neither the Federal
Government, nor a State, tribal or local government, nor any other
entity that administers any HUD program or activity, shall discriminate
against an organization on the basis of the organization's religious
character, affiliation, or lack thereof, or on the basis of the
organization's religious exercise. For purposes of this part, to
discriminate against an organization on the basis of the organization's
religious exercise means to disfavor an organization, including by
failing to select an organization, disqualifying an organization, or
imposing any condition or selection criterion that otherwise disfavors
or penalizes an organization in the selection process or has such an
effect:
(1) Because of conduct that would not be considered grounds to
disfavor a secular organization;
(2) Because of conduct that must or could be granted an appropriate
accommodation in a manner consistent with RFRA (42 U.S.C. 2000bb
through 2000bb-4) or the Religion Clauses of the First Amendment to the
Constitution; or
(3) Because of the actual or suspected religious motivation of the
organization's religious exercise.
(4) In addition, decisions about awards of Federal 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 based on the organization's religious character, affiliation, or
lack thereof, or based on the organization's religious exercise.
Notices of funding availability, grant agreements, and cooperative
agreements shall include language substantially similar to that in
appendix A to this subpart, where faith-based organizations are
eligible for such opportunities.
(d) Independence and identity of faith-based organizations. (1) A
faith-based organization that applies for, or participates in, a HUD
program or activity supported with Federal financial assistance retains
its autonomy, right of expression, religious character, authority over
its governance, and independence, and may continue to carry out its
mission, including the definition, development, practice, and
expression of its religious beliefs. A faith-based organization that
receives Federal financial assistance from HUD does not lose the
protections of law.
Note 1 to Paragraph (d)(1): Memorandum for All Executive
Departments and Agencies, From the Attorney General, ``Federal Law
Protections for Religious Liberty'' (Oct. 6, 2017) (describing
Federal law protections for religious liberty).
(2) A faith-based organization that receives direct Federal
financial assistance may use space (including a sanctuary, chapel,
prayer hall, or other space) in its facilities (including a temple,
synagogue, church, mosque, or other place of worship) to carry out
activities under a HUD program without concealing, altering, or
removing religious art, icons, scriptures, or other religious symbols.
In addition, a faith-based organization participating in a HUD program
or activity retains its authority over its internal governance, and may
retain religious terms in its organization's name, select its board
members and employees on the basis of their acceptance of or adherence
to the religious tenets of the organization consistent with paragraph
(i) of this section), and include religious references in its
organization's mission statements and other governing documents.
(e) * * * The use of indirect Federal financial assistance is not
subject to this restriction. Nothing in this part restricts HUD's
authority under applicable Federal law to fund activities, that can be
directly funded by the Government consistent with the Establishment
Clause of the U.S. Constitution.
* * * * *
(g) Nondiscrimination requirements. Any organization that receives
Federal financial assistance under a HUD program or activity shall not,
in providing services with such assistance or carrying out activities
with such assistance, discriminate against a beneficiary or prospective
beneficiary on the basis of religion, religious belief, a refusal to
hold a religious belief, or a refusal to attend or participate in a
religious practice. However, an organization that participates in a
program funded by indirect Federal financial assistance need not modify
its program or activities to accommodate a beneficiary who chooses to
expend the indirect aid on the organization's program and may require
attendance at all activities that are fundamental to the program.
(h) No additional assurances from faith-based organizations. A
faith-based organization is not rendered ineligible by its religious
nature to access and participate in HUD programs. Absent regulatory or
statutory authority, no notice of funding availability, grant
agreement, cooperative agreement, covenant, memorandum of
understanding, policy, or regulation that is used by HUD or a recipient
or intermediary in administering Federal financial assistance from HUD
shall require otherwise eligible faith-based organizations to provide
assurances or notices where they are not required of similarly situated
secular organizations. All organizations that participate in HUD
programs or activities, including organizations with religious
character or affiliations, must carry out eligible activities in
accordance with all program requirements, subject to any required or
appropriate accommodation, particularly under the Religious Freedom
Restoration Act, and other applicable requirements governing the
conduct of HUD-funded activities, including those prohibiting the use
of direct financial assistance to engage in explicitly religious
activities. No notice of funding availability, grant agreement,
cooperative agreement, covenant, memorandum of understanding, policy,
or regulation that is used by HUD or a recipient or intermediary in
administering financial assistance from HUD shall disqualify otherwise
eligible faith-based organizations from participating in HUD's programs
or activities because such organization is motivated or influenced by
religious faith to provide such programs and activities, or because of
its religious character or affiliation, or on grounds that discriminate
against an organization on the basis of the
[[Page 82137]]
organization's religious exercise, as defined in this part.
* * * * *
(l) Tax exempt organizations. In general, HUD does not require that
a recipient, including a faith-based organization, obtain tax-exempt
status under section 501(c)(3) of the Internal Revenue Code to be
eligible for funding under HUD programs. Many grant programs, however,
do require an organization to be a nonprofit organization in order to
be eligible for funding. Notices of funding availability that require
organizations to have nonprofit status will specifically so indicate in
the eligibility section of the notice of funding availability. In
addition, if any notice of funding availability requires an
organization to maintain tax-exempt status, it will expressly state the
statutory authority for requiring such status. Applicants should
consult with the appropriate HUD program office to determine the scope
of any applicable requirements. In HUD programs in which an applicant
must show that it is a nonprofit organization but this is not
statutorily defined, the applicant may do so by any of the following
means:
(1) Proof that the Internal Revenue Service currently recognizes
the applicant as an organization to which contributions are tax
deductible under section 501(c)(3) of the Internal Revenue Code;
(2) A statement from a State or other governmental taxing body or
the State secretary of State certifying that--
(i) The organization is a nonprofit organization operating within
the State; and
(ii) No part of its net earnings may benefit any private
shareholder or individual;
(3) A certified copy of the applicant's certificate of
incorporation or similar document that clearly establishes the
nonprofit status of the applicant;
(4) Any item described in paragraphs (l)(1) through (3) of this
section, if that item applies to a State or national parent
organization, together with a statement by the State or parent
organization that the applicant is a local nonprofit affiliate; or
(5) For an entity that holds a sincerely held religious belief that
it cannot apply for a determination as an entity that is tax-exempt
under section 501(c)(3) of the Internal Revenue Code, evidence
sufficient to establish that the entity would otherwise qualify as a
nonprofit organization under paragraphs (l)(1) through (4) of this
section.
(m) Rule of construction. Neither HUD nor any recipient or other
intermediary receiving funds under any HUD program or activity shall
construe these provisions in such a way as to advantage or disadvantage
faith-based organizations affiliated with historic or well-established
religions or sects in comparison with other religions or sects.
0
43. Add appendix A to subpart A of part 5 to read as follows:
Appendix A to Subpart A of Part 5--Notice of Funding Availability
(a) Faith-based organizations may apply for this award on the
same basis as any other organization, as set forth at, and subject
to the protections and requirements of 42 U.S.C. 2000bb et seq., HUD
will not, in the selection of recipients, discriminate against an
organization on the basis of the organization's religious character,
affiliation, or exercise.
(b) A faith-based organization that participates in this program
will retain its independence, and may continue to carry out its
mission consistent with religious freedom and conscience protections
in Federal law, including the Free Speech and Free Exercise Clauses
of the Constitution, 42 U.S.C. 2000bb et seq., 42 U.S.C. 238n, 42
U.S.C. 18113, 42 U.S.C. 2000e-1(a) and 2000e-2(e), 42 U.S.C.
12113(d), and the Weldon Amendment, among others. Religious
accommodations may also be sought under many of these religious
freedom and conscience protection laws, particularly under the
Religious Freedom Restoration Act.
(c) A faith-based organization may not use direct financial
assistance from HUD to support or engage in any explicitly religious
activities except where consistent with the Establishment Clause and
any other applicable requirements. Such an organization also may
not, in providing services funded by HUD, discriminate against a
beneficiary or prospective program beneficiary on the basis of
religion, religious belief, a refusal to hold a religious belief, or
a refusal to attend or participate in a religious practice.
PART 92--HOME INVESTMENT PARTNERSHIPS PROGRAM
0
44. The authority citation for part 92 continues to read as follows:
Authority: 42 U.S.C. 3535(d), 12 U.S.C. 1701x and 4568.
Sec. 92.508 [Amended]
0
45. Amend Sec. 92.508 by removing paragraph (a)(2)(xiii).
Department of Justice
0
For the reasons set forth in the preamble, DOJ revises part 38 of title
28 of the CFR to read as follows:
PART 38--PARTNERSHIPS WITH FAITH-BASED AND OTHER NEIGHBORHOOD
ORGANIZATIONS
Sec.
38.1 Purpose.
38.2 Applicability and scope.
38.3 Definitions.
38.4 Policy.
38.5 Responsibilities.
38.6 Procedures.
38.7 Assurances.
38.8 Enforcement.
Appendix A to Part 38--Notice or Announcement of Award Opportunities
Appendix B to Part 38--Notice of Award or Contract
Authority: 28 U.S.C. 509; 5 U.S.C. 301; E.O. 13279, 67 FR
77141, 3 CFR, 2002 Comp., p. 258; 18 U.S.C. 4001, 4042, 5040; 21
U.S.C. 871; 25 U.S.C. 3681; Pub. L. 107-273, 116 Stat. 1758; Pub. L.
109-162, 119 Stat. 2960; 34 U.S.C. 10152, 10154, 10172, 10221,
10382, 10388, 10444, 10446, 10448, 10473, 10614, 10631, 11111,
11182, 20110, 20125; E.O. 13559, 75 FR 71319, 3 CFR, 2010 Comp., p.
273; E.O. 13831, 83 FR 20715, 3 CFR, 2018 Comp., p. 806; 42 U.S.C.
2000bb et seq.
Sec. 38.1 Purpose.
The purpose of this part is to implement Executive Order 13279,
Executive Order 13559, and Executive Order 13831.
Sec. 38.2 Applicability and scope.
(a) A faith-based organization that applies for, or participates
in, a social service program supported with Federal financial
assistance 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 Federal financial assistance, whether received 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.
(b) The use of indirect Federal financial assistance is not subject
to this restriction.
(c) Nothing in this part restricts the Department's authority under
applicable Federal law to fund activities, such as the provision of
chaplaincy services, that can be directly funded by the Government
consistent with the Establishment Clause.
(d) To the extent that any provision of this regulation is declared
invalid by a court of competent jurisdiction, the Department intends
for all other provisions that are capable of operating in the absence
of the specific provision that has been invalidated to remain in
effect.
Sec. 38.3 Definitions.
As used in this part:
(a)(1) ``Direct Federal financial assistance'' or ``Federal
financial
[[Page 82138]]
assistance provided directly'' refers to situations where the
Government or an intermediary (under this part) selects the provider
and either purchases services from that provider (e.g., via a contract)
or awards funds to that provider to carry out a service (e.g., via a
grant or cooperative agreement). In general, and except as provided in
paragraph (a)(2) of this section, Federal financial assistance shall be
treated as direct, unless it meets the definition of ``indirect Federal
financial assistance'' or ``Federal financial assistance provided
indirectly.''
(2) Recipients of sub-grants that receive Federal financial
assistance through State administering agencies or State-administered
programs are recipients of ``direct Federal financial assistance'' (or
recipients of ``Federal financial assistance provided directly'').
(b) ``Indirect Federal financial assistance'' or ``Federal
financial assistance provided indirectly'' refers to situations where
the choice of the service provider is placed in the hands of the
beneficiary, and the cost of that service is paid through a voucher,
certificate, or other similar means of government-funded payment.
Federal financial assistance is considered ``indirect'' when:
(1) The government program through which the beneficiary receives
the voucher, certificate, or other similar means of government-funded
payment is neutral toward religion and
(2) The service provider receives the assistance as a result of an
independent choice of the beneficiary, not a choice of the Government.
(c)(1) ``Intermediary'' or ``pass-through entity'' means an entity,
including a nonprofit or nongovernmental organization, acting under a
contract, grant, or other agreement with the Federal Government or with
a State or local government, such as a State administering agency, that
accepts Federal financial assistance as a primary recipient or grantee
and distributes that assistance to other organizations that, in turn,
provide government-funded social services.
(2) When an intermediary, such as a State administering agency,
distributes Federal financial assistance to other organizations, it
replaces the Department as the awarding entity. The intermediary
remains accountable for the Federal financial assistance it disburses
and, accordingly, must ensure that any providers to which it disburses
Federal financial assistance also comply with this part.
(d) ``Department program'' refers to a grant, contract, or
cooperative agreement funded by a discretionary, formula, or block
grant program administered by or from the Department.
(e) ``Grantee'' includes a recipient of a grant, a signatory to a
cooperative agreement, or a contracting party.
(f) The ``Office for Civil Rights'' refers to the Office for Civil
Rights in the Department's Office of Justice Programs.
(g) ``Religious exercise'' has the meaning given to the term in 42
U.S.C. 2000cc-5(7)(A).
Sec. 38.4 Policy.
(a) Grants (formula and discretionary), contracts, and cooperative
agreements. Faith-based organizations are eligible, on the same basis
as any other organization and considering any religious accommodations
appropriate under the Constitution or other provisions of Federal law,
including but not limited to 42 U.S.C. 2000bb et seq., 42 U.S.C. 38n,
42 U.S.C. 18113, 42 U.S.C. 2000e-1(a) and 2000e-2(e), 42 U.S.C.
12113(d), and the Weldon Amendment, to participate in any Department
program for which they are otherwise eligible. Neither the Department
nor any State or local government receiving funds under any Department
program shall, in the selection of service providers, discriminate for
or against an organization on the basis of the organization's religious
character or affiliation, or lack thereof, or on the basis of the
organization's religious exercise. For purposes of this part, to
discriminate against an organization on the basis of the organization's
religious exercise means to disfavor an organization, including by
failing to select an organization, disqualifying an organization, or
imposing any condition or selection criterion that otherwise disfavors
or penalizes an organization in the selection process or has such an
effect:
(1) Because of conduct that would not be considered grounds to
disfavor a secular organization;
(2) Because of conduct that must or could be granted an appropriate
accommodation in a manner consistent with the Religious Freedom
Restoration Act (42 U.S.C. 2000bb et seq.) or the Religion Clauses of
the First Amendment to the Constitution; or
(3) Because of the actual or suspected religious motivation of the
organization's religious exercise.
(b) Political or religious affiliation. Decisions about awards of
Federal 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, religious belief, or lack
thereof.
Sec. 38.5 Responsibilities.
(a) Organizations that receive direct Federal financial assistance
from the Department 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 funded with direct Federal financial assistance
from the Department. If an organization conducts such explicitly
religious activities, the activities must be offered separately, in
time or location, from the programs or services funded with direct
Federal financial assistance from the Department, and participation
must be voluntary for beneficiaries of the programs or services funded
with such assistance.
(b) A faith-based organization that participates in Department-
funded programs or services shall retain its autonomy; right of
expression; religious character; and independence from Federal, State,
and local governments, and may continue to carry out its mission,
including the definition, practice, and expression of its religious
beliefs, provided that it does not use direct Federal financial
assistance from the Department to fund any explicitly religious
activities, including activities that involve overt religious content
such as worship, religious instruction, or proselytization. Among other
things, a faith-based organization that receives Federal financial
assistance from the Department may use space in its facilities without
concealing, altering, or removing religious art, icons, messages,
scriptures, or symbols. In addition, a faith-based organization that
receives Federal financial assistance from the Department retains its
authority over its internal governance, and it may retain religious
terms in its name, select its board members on the basis of their
acceptance of or adherence to the religious tenets of the organization,
and include religious references in its mission statements and other
governing documents.
(c) Any organization that participates in programs funded by
Federal financial assistance from the Department shall not, in
providing services, discriminate against a program beneficiary or
prospective program beneficiary on the basis of religion, a religious
belief, a refusal to hold a religious belief, or a refusal to attend or
participate in a religious practice. However, an organization that
participates in a program funded by indirect Federal financial
assistance need not modify its
[[Page 82139]]
program activities to accommodate a beneficiary who chooses to expend
the indirect aid on the organization's program and may require
attendance at all activities that are fundamental to the program.
(d) No grant document, agreement, covenant, memorandum of
understanding, policy, or regulation that the Department or a State or
local government uses in administering Federal financial assistance
from the Department shall require faith-based or religious
organizations to provide assurances or notices where they are not
required of non-faith-based organizations. Any restrictions on the use
of grant funds shall apply equally to faith-based and non-faith-based
organizations. All organizations, including religious ones, that
participate in Department programs must carry out all eligible
activities in accordance with all program requirements, subject to any
religious accommodations appropriate under the Constitution or other
provisions of Federal law, including but not limited to 42 U.S.C.
2000bb et seq., 42 U.S.C. 238n, 42 U.S.C. 18113, 42 U.S.C. 2000e-1(a)
and 2000e-2(e), 42 U.S.C. 12113(d), and the Weldon Amendment, and other
applicable requirements governing the conduct of Department-funded
activities, including those prohibiting the use of direct Federal
financial assistance from the Department to engage in explicitly
religious activities. No grant, document, agreement, covenant,
memorandum of understanding, policy, or regulation that is used by the
Department or a State or local government in administering Federal
financial assistance from the Department shall disqualify faith-based
or religious organizations from participating in the Department's
programs because such organizations are motivated or influenced by
religious faith to provide social services, or because of their
religious character or affiliation, or on grounds that discriminate
against organizations on the basis of the organizations' religious
exercise, as defined in this part.
(e) A faith-based 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(a), is not forfeited when the organization receives direct or
indirect Federal financial assistance from the Department. Some
Department programs, however, contain independent statutory provisions
requiring that all grantees agree not to discriminate in employment on
the basis of religion. Accordingly, grantees should consult with the
appropriate Department program office to determine the scope of any
applicable requirements.
(f) If an intermediary, acting under a contract, grant, or other
agreement with the Federal Government or with a State or local
government that is administering a program supported by Federal
financial assistance, is given the authority under the contract, grant,
or agreement to select organizations to provide services funded by the
Federal Government, the intermediary must ensure the compliance of the
recipient of a contract, grant, or agreement with the provisions of
Executive Order 13279, as amended by Executive Order 13559 and further
amended by Executive Order 13831, and any implementing rules or
guidance. If the intermediary is a nongovernmental organization, it
retains all other rights of a nongovernmental organization under the
program's statutory and regulatory provisions.
(g) In general, the Department does not require that a grantee,
including a faith-based organization, obtain tax-exempt status under
section 501(c)(3) of the Internal Revenue Code to be eligible for
funding under Department programs. Many grant programs, however, do
require an organization to be a ``nonprofit organization'' in order to
be eligible for funding. Individual solicitations that require
organizations to have nonprofit status will specifically so indicate in
the eligibility sections of the solicitations. In addition, any
solicitation that requires an organization to maintain tax-exempt
status shall expressly state the statutory authority for requiring such
status. Grantees should consult with the appropriate Department program
office to determine the scope of any applicable requirements. In
Department programs in which an applicant must show that it is a
nonprofit organization, the applicant may do so by any of the following
means:
(1) Proof that the Internal Revenue Service currently recognizes
the applicant as an organization to which contributions are tax
deductible under section 501(c)(3) of the Internal Revenue Code;
(2) A statement from a State taxing body or the State secretary of
state certifying that:
(i) The organization is a nonprofit organization operating within
the State; and
(ii) No part of its net earnings may lawfully benefit any private
shareholder or individual;
(3) A certified copy of the applicant's certificate of
incorporation or similar document that clearly establishes the
nonprofit status of the applicant;
(4) Any item described in paragraphs (g)(1) through (3) of this
section if that item applies to a State or national parent
organization, together with a statement by the State or parent
organization that the applicant is a local nonprofit affiliate; or
(5) For an entity that holds a sincerely held religious belief that
it cannot apply for a determination as an entity that is tax-exempt
under section 501(c)(3) of the Internal Revenue Code, evidence
sufficient to establish that the entity would otherwise qualify as a
nonprofit organization under paragraphs (g)(1) through (4) of this
section.
(h) Grantees should consult with the appropriate Department program
office to determine the applicability of this part in foreign countries
or sovereign lands.
(i) Neither the Department nor any State or local government or
other pass-through entity receiving funds under any Department program
or service shall construe these provisions in such a way as to
advantage or disadvantage faith-based organizations affiliated with
historic or well-established religions or sects in comparison with
other religions or sects.
Sec. 38.6 Procedures.
(a) Effect on State and local funds. If a State or local government
voluntarily contributes its own funds to supplement activities carried
out under the applicable programs, the State or local government has
the option to separate out the Federal funds or commingle them. If the
funds are commingled, the provisions of this section shall apply to all
of the commingled funds in the same manner, and to the same extent, as
the provisions apply to the Federal funds.
(b) Notices or announcements. Notices or announcements of award
opportunities and notices of award or contracts shall include language
substantially similar to that in appendices A and B, respectively, to
this part.
Sec. 38.7 Assurances.
(a) Every application submitted to the Department for direct
Federal financial assistance subject to this part must contain, as a
condition of its approval and the extension of any such assistance, or
be accompanied by, an assurance or statement that the program is or
will be conducted in compliance with this part.
(b) Every intermediary must provide for such methods of
administration as are required by the Office for Civil Rights to give
reasonable assurance that
[[Page 82140]]
the intermediary will comply with this part and effectively monitor the
actions of its recipients.
Sec. 38.8 Enforcement.
(a) The Office for Civil Rights is responsible for reviewing the
practices of recipients of Federal financial assistance to determine
whether they are in compliance with this part.
(b) The Office for Civil Rights is responsible for investigating
any allegations of noncompliance with this part.
(c) Recipients of Federal financial assistance determined to be in
violation of any provisions of this part are subject to the enforcement
procedures and sanctions, up to and including suspension and
termination of funds, authorized by applicable laws.
(d) An allegation of any violation or discrimination by an
organization, based on this regulation, may be filed with the Office
for Civil Rights or the intermediary that awarded the funds to the
organization.
Appendix A to Part 38--Notice or Announcement of Award Opportunities
(a) Faith-based organizations may apply for this award on the
same basis as any other organization, as set forth at, and subject
to the protections and requirements of this part and 42 U.S.C.
2000bb et seq. The Department of Justice will not, in the selection
of recipients, discriminate against an organization on the basis of
the organization's religious character, exercise or affiliation.
(b) A faith-based organization that participates in this program
will retain its independence from the Government and may continue to
carry out its mission consistent with religious freedom and
conscience protections in Federal law, including the Free Speech and
Free Exercise Clauses of the First Amendment, 42 U.S.C. 2000bb et
seq., 42 U.S.C. 238n, 42 U.S.C. 18113, 42 U.S.C. 2000e-1(a) and
2000e-2(e), 42 U.S.C. 12113(d), and the Weldon Amendment, among
others. Religious accommodations may also be sought under many of
these religious freedom and conscience protection laws.
(c) A faith-based organization may not use direct Federal
financial assistance from the Department of Justice to support or
engage in any explicitly religious activities except where
consistent with the Establishment Clause and any other applicable
requirements. An organization receiving direct Federal financial
assistance also may not, in providing services funded by the
Department of Justice, discriminate against a program beneficiary or
prospective program beneficiary on the basis of religion, a
religious belief, a refusal to hold a religious belief, or a refusal
to attend or participate in a religious practice.
Appendix B to Part 38--Notice of Award or Contract
(a) A faith-based organization that participates in this program
retains its independence from the Government and may continue to
carry out its mission consistent with religious freedom and
conscience protections in Federal law, including the Free Speech and
Free Exercise Clauses of the Constitution, 42 U.S.C. 2000bb et seq.,
42 U.S.C. 238n, 42 U.S.C. 18113, 42 U.S.C. 2000e-1(a) and 2000e-
2(e), 42 U.S.C. 12113(d), and the Weldon Amendment, among others.
Religious accommodations may also be sought under many of these
religious freedom and conscience protection laws.
(b) A faith-based organization may not use direct Federal
financial assistance from the Department of Justice to support or
engage in any explicitly religious activities except when consistent
with the Establishment Clause of the First Amendment and any other
applicable requirements. An organization receiving direct Federal
financial assistance also may not, in providing services funded by
the Department of Justice, discriminate against a program
beneficiary or prospective program beneficiary on the basis of
religion, a religious belief, a refusal to hold a religious belief,
or a refusal to attend or participate in a religious practice.
DEPARTMENT OF LABOR
For the reasons set forth in the preamble, DOL amends part 2 of
title 29 of the Code of Federal Regulations as follows:
PART 2--GENERAL REGULATIONS
0
46. The authority citation for part 2 is revised to read as follows:
Authority: 5 U.S.C. 301; E.O. 13198, 66 FR 8497, 3 CFR, 2001
Comp., p. 750; E.O. 13279, 67 FR 77141, 3 CFR, 2002 Comp., p. 258;
E.O. 13559, 75 FR 71319, 3 CFR, 2010 Comp., p. 273; E.O. 13831, 83
FR 20715, 3 CFR, 2018 Comp., p. 806; 42 U.S.C. 2000bb et seq.
Subpart D--Equal Treatment in Department of Labor Programs for
Faith-Based and Community Organizations; Protection of Religious
Liberty of Department of Labor Social Service Providers and
Beneficiaries
0
47. Amend Sec. 2.31 by revising paragraphs (a) introductory text and
(a)(2) and adding paragraph (h) to read as follows:
Sec. 2.31 Definitions.
* * * * *
(a) The term Federal financial assistance means assistance that
non-Federal entities (including State and local governments) receive or
administer in the form of grants, contracts, loans, loan guarantees,
property, cooperative agreements, direct appropriations, or other
direct or indirect assistance, but does not include a tax credit,
deduction, or exemption, nor the use by a private participant of
assistance obtained through direct benefit programs (such as
Supplemental Nutrition Assistance Program, social security, pensions).
Federal financial assistance may be direct or indirect.
* * * * *
(2) The term indirect Federal financial assistance or Federal
financial assistance provided indirectly means that the choice of the
service provider is placed in the hands of the beneficiary, and the
cost of that service is paid through a voucher, certificate, or other
similar means of government-funded payment. Federal financial
assistance provided to an organization is considered indirect when:
(i) The Government program through which the beneficiary receives
the voucher, certificate, or other similar means of Government-funded
payment is neutral toward religion; and
(ii) The organization receives the assistance as a result of a
genuine, independent choice of the beneficiary.
* * * * *
(h) The term religious exercise has the meaning given to the term
in 42 U.S.C. 2000cc-5(7)(A).
0
48. Revise Sec. 2.32 to read as follows:
Sec. 2.32 Equal participation of faith-based organizations.
(a) Faith-based organizations must be eligible, on the same basis
as any other organization and considering any reasonable accommodation,
to seek DOL support or participate in DOL programs for which they are
otherwise eligible. DOL and DOL social service intermediary providers,
as well as State and local governments administering DOL support, must
not discriminate for or against an organization on the basis of the
organization's religious character, affiliation, or exercise, although
this requirement does not preclude DOL, DOL social service providers,
or State or local governments administering DOL support from
accommodating religion in a manner consistent with the Religion Clauses
of the First Amendment to the Constitution. In addition, because this
rule does not affect existing constitutional requirements, DOL, DOL
social service providers (insofar as they may otherwise be subject to
any constitutional requirements), and State and local governments
administering DOL support must continue to comply with otherwise
applicable constitutional principles, including, among others, those
articulated in the Establishment, Free Speech, and Free Exercise
Clauses of the First Amendment to the
[[Page 82141]]
Constitution. Notices and announcements of award opportunities and
notices of award and contracts shall include language substantially
similar to that in appendices A and B, respectively, to this part.
(b) A faith-based organization that is a DOL social service
provider retains its autonomy; right of expression; religious
character; and independence from Federal, State, and local governments
and must be permitted to continue to carry out its mission, including
the definition, development, practice, and expression of its religious
beliefs. Among other things, such a faith-based organization must be
permitted to:
(1) Use its facilities to provide DOL-supported social services
without concealing, removing, or altering religious art, icons,
scriptures, or other religious symbols from those facilities; and
(2) Retain its authority over its internal governance, including
retaining religious terms in its name, selecting its board members and
employees on the basis of their acceptance of or adherence to the
religious requirements or standards of the organization, and including
religious references in its mission statements and other governing
documents.
(c) A grant document, contract or other agreement, covenant,
memorandum of understanding, policy, or regulation that is used by DOL,
a State or local government administering DOL support, or a DOL social
service intermediary provider must not require faith-based
organizations to provide assurances or notices where they are not
required of non-faith-based organizations. Any restrictions on the use
of financial assistance under a grant shall apply equally to faith-
based and non-faith-based organizations. All organizations, including
religious ones that are DOL social service providers, must carry out
DOL-supported activities, subject to any required or appropriate
religious accommodation, in accordance with all program requirements,
including those prohibiting the use of direct DOL support for
explicitly religious activities (including worship, religious
instruction, or proselytization). A grant document, contract or other
agreement, covenant, memorandum of understanding, policy, or regulation
that is used by DOL, a State or local government, or a DOL social
service intermediary provider in administering a DOL social service
program must not disqualify organizations from receiving DOL support or
participating in DOL programs because such organizations are motivated
or influenced by religious faith to provide social services, or because
of their religious character or affiliation, or lack thereof, on
grounds that discriminate against organizations on the basis of the
organizations' religious exercise.
(d) For purposes of this subpart, to discriminate against an
organization on the basis of the organization's religious exercise
means to disfavor an organization, including by failing to select an
organization, disqualifying an organization, or imposing any condition
or selection criterion that otherwise disfavors or penalizes an
organization in the selection process or has such an effect:
(1) Because of conduct that would not be considered grounds to
disfavor a secular organization;
(2) Because of conduct that must or could be granted an appropriate
accommodation in a manner consistent with the Religious Freedom
Restoration Act (RFRA) (42 U.S.C. 2000bb through 2000bb-4) or the
Religion Clauses of the First Amendment to the Constitution; or
(3) Because of the actual or suspected religious motivation of the
organization's religious exercise.
Sec. 2.33 [Amended]
0
49. Amend Sec. 2.33 as follows:
0
a. In the second sentence of paragraph (a), by adding ``and may require
attendance at all activities that are fundamental to the program''
after ``organization's program''.
0
b. In paragraph (c), by adding ``and further amended by Executive Order
13831'' after ``13559''.
Sec. Sec. 2.34 and 2.35 [Removed and Reserved]
0
50. Remove and reserve Sec. Sec. 2.34 and 2.35.
0
51. Revise Sec. 2.37 to read as follows:
Sec. 2.37 Effect of DOL support on Title VII employment
nondiscrimination requirements and on other existing statutes.
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 the organization receives direct or indirect DOL
support. An organization qualifying for such exemption may make its
employment decisions on the basis of an applicant's or employee's
acceptance of or adherence to the religious requirements or standards
of the organization, but not on the basis of any other protected
characteristic. Some DOL programs, however, were established through
Federal statutes containing independent statutory provisions requiring
that recipients refrain from discriminating on the basis of religion.
Accordingly, to determine the scope of any applicable requirements,
including in light of any additional constitutional or statutory
protections for employment decisions that may apply, recipients and
potential recipients should consult with the appropriate DOL program
official or with the Civil Rights Center, U.S. Department of Labor, 200
Constitution Avenue NW, Room N4123, Washington, DC 20210, (202) 693-
6500. Individuals with hearing or speech impairments may access this
telephone number via TTY by calling the toll-free Federal Information
Relay Service at 1-800-877-8339.
0
52. Amend Sec. 2.38 by revising paragraphs (b)(3) and (4) and adding
(b)(5) to read as follows:
Sec. 2.38 Status of nonprofit organizations.
* * * * *
(b) * * *
(3) A certified copy of the applicant's certificate of
incorporation or similar document that clearly establishes the
nonprofit status of the applicant;
(4) Any item described in paragraphs (b)(1) through (3) of this
section, if that item applies to a State or national parent
organization, together with a statement by the State or national parent
organization that the applicant is a local nonprofit affiliate of the
organization; or
(5) For an entity that holds a sincerely held religious belief that
it cannot apply for a determination as an entity that is tax exempt
under section 501(c)(3) of the Internal Revenue Code, evidence
sufficient to establish that the entity would otherwise qualify as a
nonprofit organization under paragraphs (b)(1) through (4) of this
section.
Sec. 2.39 [Amended]
0
53. Amend Sec. 2.39 by removing ``not on the basis of religion or
religious belief or lack thereof'' and adding in its place ``not on the
basis of the religious affiliation of a recipient organization or lack
thereof''.
0
54. Add Sec. 2.40 to read as follows:
Sec. 2.40 Nondiscrimination among faith-based organizations.
Neither DOL nor any State or local government or other entity
receiving financial assistance under any DOL program or service shall
construe the provisions of this part in such a way as to advantage or
disadvantage faith-based organizations affiliated with historic or
well-established religions or sects in comparison with other religions
or sects.
0
55. Add Sec. 2.41 to read as follows:
[[Page 82142]]
Sec. 2.41 Severability.
Should a court of competent jurisdiction hold any provision(s) of
this subpart to be invalid, such action will not affect any other
provision of this subpart.
0
56. Revise appendices A and B to read as follows:
Appendix A to Part 2--Notice or Announcement of Award Opportunities
(a) Faith-based organizations may apply for this award on the
same basis as any other organization, as set forth at, and subject
to the protections and requirements of subpart D of this part and 42
U.S.C. 2000bb et seq. DOL will not, in the selection of recipients,
discriminate for or against an organization on the basis of the
organization's religious character, exercise or affiliation.
(b) A faith-based organization that participates in this program
will retain its independence from the Government and may continue to
carry out its mission consistent with religious freedom and
conscience protections in Federal law, including the Free Speech and
Free Exercise Clauses of the First Amendment, 42 U.S.C. 2000bb et
seq., 42 U.S.C. 238n, 42 U.S.C. 18113, 42 U.S.C. 2000e-1(a) and
2000e-2(e), 42 U.S.C. 12113(d), and the Weldon Amendment, among
others. Religious accommodations may also be sought under many of
these religious freedom and conscience protection laws.
(c) A faith-based organization may not use direct financial
assistance from DOL to engage in any explicitly religious activities
except where consistent with the Establishment Clause of the First
Amendment to the Constitution and any other applicable requirements.
Such an organization also may not, in providing services financially
assisted by DOL, discriminate against a program beneficiary or
prospective program beneficiary on the basis of religion, a
religious belief, a refusal to hold a religious belief, or a refusal
to attend or participate in a religious practice.
Appendix B to Part 2--Notice of Award or Contract
(a) A faith-based organization that participates in this program
retains its independence from the Government and may continue to
carry out its mission consistent with religious freedom and
conscience protections in Federal law, including the Free Speech and
Free Exercise Clauses of the First Amendment to the Constitution, 42
U.S.C. 2000bb et seq., 42 U.S.C. 238n, 42 U.S.C. 18113, 42 U.S.C.
2000e-1(a) and 2000e-2(e), 42 U.S.C. 12113(d), and the Weldon
Amendment, among others. Religious accommodations may also be sought
under many of these religious freedom and conscience protection
laws.
(b) A faith-based organization may not use direct financial
assistance from DOL to engage in any explicitly religious activities
except when consistent with the Establishment Clause of the First
Amendment and any other applicable requirements. Such an
organization also may not, in providing services financially
assisted by DOL, discriminate against a program beneficiary or
prospective program beneficiary on the basis of religion, a
religious belief, a refusal to hold a religious belief, or a refusal
to attend or participate in a religious practice.
DEPARTMENT OF VETERANS AFFAIRS
For the reasons set forth in the preamble, VA amends parts 50, 61,
and 62 of title 38 of the CFR as follows:
0
57. Part 50 is revised to read as follows:
PART 50--EQUAL TREATMENT FOR FAITH BASED ORGANIZATIONS
Sec.
50.1 Definitions.
50.2 Faith-based organizations and Federal financial assistance.
Appendix A to Part 50--Notice or Announcement of Award
Opportunities.
Appendix B to Part 50--Notice of Award or Contract.
Authority: 38 U.S.C. 501 and as noted in specific sections.
Sec. 50.1 Definitions.
(a) Direct Federal financial assistance, Federal financial
assistance provided directly, direct funding, or directly funded means
financial assistance received by an entity selected by the Government
or pass-through entity (under this part) to carry out a service (e.g.,
by contract, grant, or cooperative agreement). References to ``Federal
financial assistance'' will be deemed to be references to direct
Federal financial assistance, unless the referenced assistance meets
the definition of ``indirect Federal financial assistance'' or
``Federal financial assistance provided indirectly.''
(b) Indirect Federal financial assistance or Federal financial
assistance provided indirectly means financial assistance received by a
service provider when the service provider is paid for services by
means of a voucher, certificate, or other means of government-funded
payment provided to a beneficiary who is able to make a choice of a
service provider. Federal financial assistance provided to an
organization is considered ``indirect'' within the meaning of the
Establishment Clause of the First Amendment to the U.S. Constitution
when--
(1) The government program through which the beneficiary receives
the voucher, certificate, or other similar means of government funded
payment is neutral toward religion; and
(2) The organization receives the assistance as a result of a
genuine, independent choice of the beneficiary.
(c) Federal financial assistance does not include a tax credit,
deduction, exemption, guaranty contracts, or the use of any assistance
by any individual who is the ultimate beneficiary under any such
program.
(d) Pass-through entity means an entity, including a nonprofit or
nongovernmental organization, acting under a contract, grant, or other
agreement with the Federal Government or with a State or local
government, such as a State administering agency, that accepts direct
Federal financial assistance as a primary recipient or grantee and
distributes that assistance to other organizations that, in turn,
provide government-funded social services.
(e) Programs or services has the same definition as ``social
service program'' in Executive Order 13279.
(f) Recipient means a non-Federal entity that receives a Federal
award directly from a Federal awarding agency to carry out an activity
under a Federal program. The term recipient does not include
subrecipients, but does include pass-through entities.
(g) Religious exercise has the meaning given to the term in 42
U.S.C. 2000cc-5(7)(A).
Sec. 50.2 Faith-based organizations and Federal financial assistance.
(a) Faith-based organizations are eligible, on the same basis as
any other organization and considering any permissible accommodation,
to participate in any VA program or service. Neither the VA program nor
any State or local government or other pass-through entity receiving
funds under any VA program shall, in the selection of service
providers, discriminate for or against an organization on the basis of
the organization's religious character, affiliation, or exercise.
Notices or announcements of award opportunities and notices of award or
contracts shall include language substantially similar to that in
appendix A and B, respectively, to this part. For purposes of this
part, to discriminate against an organization on the basis of the
organization's religious exercise means to disfavor an organization,
including by failing to select an organization, disqualifying an
organization, or imposing any condition or selection criterion that
otherwise disfavors or penalizes an organization in the selection
process or has such an effect:
(1) Because of conduct that would not be considered grounds to
disfavor a secular organization;
(2) Because of conduct that must or could be granted an appropriate
accommodation in a manner consistent
[[Page 82143]]
with RFRA (42 U.S.C. 2000bb through 2000bb-4) or the Religion Clauses
of the First Amendment to the Constitution; or
(3) Because of the actual or suspected religious motivation of the
organization's religious exercise.
(b) Organizations that receive direct financial assistance from a
VA program may not engage in any explicitly religious activities
(including activities that involve overt religious content such as
worship, religious instruction, or proselytization) as part of the
programs or services funded with direct financial assistance from the
VA program, or in any other manner prohibited by law. 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 the VA program, and participation
must be voluntary for beneficiaries of the programs or services funded
with such assistance. The use of indirect Federal financial assistance
is not subject to this restriction. Nothing in this part restricts VA's
authority under applicable Federal law to fund activities, such as the
provision of chaplaincy services, that can be directly funded by the
Government consistent with the Establishment Clause.
(c) A faith-based organization that participates in programs or
services funded by a VA program will retain its autonomy; right of
expression; religious character; and independence from Federal, State,
and local governments, and may continue to carry out its mission,
including the definition, development, practice, and expression of its
religious beliefs. A faith-based organization that receives direct
Federal financial assistance may use space in its facilities to provide
programs or services funded with financial assistance from the VA
program without concealing, removing, or altering religious art, icons,
scriptures, or other religious symbols. In addition, a faith-based
organization that receives Federal financial assistance from a VA
program does not lose the protections of law. Such a faith-based
organization retains its authority over its internal governance, and it
may retain religious terms in its name, select its board members on the
basis of their acceptance of or adherence to the religious tenets of
the organization, and include religious references in its mission
statements and other governing documents.
Note 1 to paragraph (c): Memorandum for All Executive
Departments and Agencies, From the Attorney General, ``Federal Law
Protections for Religious Liberty'' (Oct. 6, 2017) (describing
Federal law protections for religious liberty).
(d) An organization that receives direct or indirect Federal
financial assistance shall not, with respect to services, or, in the
case of direct Federal financial assistance, outreach activities funded
by such financial assistance, discriminate against a program
beneficiary or prospective program beneficiary on the basis of
religion, a religious belief, a refusal to hold a religious belief, or
a refusal to attend or participate in a religious practice. However, an
organization receiving indirect Federal financial assistance need not
modify its program activities to accommodate a beneficiary who chooses
to expend the indirect aid on the organization's program and may
require attendance at all activities that are fundamental to the
program.
(e) A faith-based organization is not rendered ineligible by its
religious exercise or affiliation to access and participate in
Department programs. No grant document, agreement, covenant, memorandum
of understanding, policy, or regulation that is used by a VA program or
a State or local government in administering Federal financial
assistance from any VA program shall require faith-based organizations
to provide assurances or notices where they are not required of non-
faith-based organizations. Any restrictions on the use of grant funds
shall apply equally to faith-based and non-faith-based organizations.
All organizations that participate in VA programs or services,
including organizations with religious character or affiliations, must
carry out eligible activities in accordance with all program
requirements, subject to any required or appropriate religious
accommodation, and other applicable requirements governing the conduct
of activities funded by any VA program, including those prohibiting the
use of direct financial assistance to engage in explicitly religious
activities. No grant document, agreement, covenant, memorandum of
understanding, policy, or regulation that is used by VA or a State or
local government in administering financial assistance from VA shall
disqualify faith-based organizations from participating in the VA
program's programs or services because such organizations are motivated
or influenced by religious faith to provide social services, or because
of their religious character or affiliation, or on grounds that
discriminate against organizations on the basis of the organizations'
religious exercise, as defined in this part.
(f) A religious organization's exemption from the Federal
prohibition on employment discrimination on the basis of religion, in
section 702(a) of the Civil Rights Act of 1964 (42 U.S.C. 2000e-1), is
not forfeited when the organization receives direct or indirect Federal
financial assistance from a VA program. An organization qualifying for
such exemption may select its employees on the basis of their
acceptance of or adherence to the religious tenets of the organization.
Some VA programs, however, contain independent statutory provision
affecting a recipient's ability to discriminate in employment.
Recipients should consult with the appropriate VA program office if
they have questions about the scope of any applicable requirement,
including in light of any additional constitutional or statutory
protections for employment decisions that may apply.
(g) In general, VA programs do not require that a recipient,
including a faith-based organization, obtain tax-exempt status under
section 501(c)(3) of the Internal Revenue Code to be eligible for
funding under VA programs. Some grant programs, however, do require an
organization to be a nonprofit organization in order to be eligible for
funding. Funding announcements and other grant application
solicitations that require organizations to have nonprofit status will
specifically so indicate in the eligibility section of the
solicitation. In addition, any solicitation that requires an
organization to maintain tax-exempt status will expressly state the
statutory authority for requiring such status. Recipients should
consult with the appropriate VA program office to determine the scope
of any applicable requirements. In VA programs in which an applicant
must show that it is a nonprofit organization, the applicant may do so
by any of the following means:
(1) Proof that the Internal Revenue Service currently recognizes
the applicant as an organization to which contributions are tax
deductible under section 501(c)(3) of the Internal Revenue Code;
(2) A statement from a State or other governmental taxing body or
the State secretary of State certifying that:
(i) The organization is a nonprofit organization operating within
the State; and
(ii) No part of its net earnings may benefit any private
shareholder or individual;
(3) A certified copy of the applicant's certificate of
incorporation or similar document that clearly establishes the
nonprofit status of the applicant;
(4) Any item described in paragraphs (g)(1) through (3) of this
section if that item applies to a State or national parent
organization, together with a statement
[[Page 82144]]
by the state or parent organization that the applicant is a local
nonprofit affiliate; or
(5) For an entity that holds a sincerely held religious belief that
it cannot apply for a determination as an entity that is tax-exempt
under section 501(c)(3) of the Internal Revenue Code, evidence
sufficient to establish that the entity would otherwise qualify as a
nonprofit organization under paragraphs (g)(2) through (4) of this
section.
(h) If a recipient contributes its own funds in excess of those
funds required by a matching or grant agreement to supplement VA
program-supported activities, the recipient has the option to segregate
those additional funds or commingle them with the Federal award funds.
If the funds are commingled, the provision 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 Federal funds. With respect to the
matching funds, the provisions of this part apply irrespective of
whether such funds are commingled with Federal funds or segregated.
(i) Decisions about awards of Federal financial assistance must be
made on the basis of merit, not on the basis of the religious
affiliation, or lack thereof, of a recipient organization, and must be
free from political interference or even the appearance of such
interference.
(j) Neither VA nor any State or local government or other pass-
through entity receiving funds under any VA program or service shall
construe these provisions in such a way as to advantage or disadvantage
faith-based organizations affiliated with historic or well-established
religions or sects in comparison with other religions or sects.
(k) If a pass-through entity, acting under a contract, grant, or
other agreement with the Federal Government or with a State or local
government that is administering a program supported by Federal
financial assistance, is given the authority under the contract, grant,
or agreement to select non-governmental organizations to provide
services funded by the Federal Government, the pass-through entity must
ensure compliance with the provisions of this part and any implementing
regulations or guidance by the sub-recipient. If the pass-through
entity is a non-governmental organization, it retains all other rights
of a non-governmental organization under the program's statutory and
regulatory provisions.
Appendix A to Part 50--Notice or Announcement of Award Opportunities
(a) Faith-based organizations may apply for this award on the
same basis as any other organization, as set forth at and, subject
to the protections and requirements of this part and 42 U.S.C.
2000bb et seq., the Department will not, in the selection of
recipients, discriminate against an organization on the basis of the
organization's religious character, affiliation, or exercise.
(b) A faith-based organization that participates in this program
will retain its independence from the Government and may continue to
carry out its mission consistent with religious and conscience
freedom protections in Federal law, including the Free Speech and
Free Exercise Clauses of the First Amendment, 42 U.S.C. 2000bb et
seq., 42 U.S.C. 238n, 42 U.S.C. 18113, 42 U.S.C. 2000e-1(a) and
2000e-2(e), 42 U.S.C. 12113(d), and the Weldon Amendment, among
others. Religious accommodations may also be sought under many of
these religious freedom and conscience protection laws.
(c) A faith-based organization may not use direct financial
assistance from the Department to support or engage in any
explicitly religious activities except where consistent with the
Establishment Clause of the First Amendment and any other applicable
requirements. Such an organization also may not, in providing
services funded by the Department, discriminate against a program
beneficiary or prospective program beneficiary on the basis of
religion, a religious belief, a refusal to hold a religious belief,
or a refusal to attend or participate in a religious practice.
Appendix B to Part 50--Notice of Award or Contract
(a) A faith-based organization that participates in this program
retains its independence from the Government and may continue to
carry out its mission consistent with religious freedom and
conscience protections in Federal law, including the Free Speech and
Free Exercise Clauses of the Constitution, 42 U.S.C. 2000bb et seq.,
42 U.S.C. 238n, 42 U.S.C. 18113, 42 U.S.C. 2000e-1(a) and 2000e-
2(e), 42 U.S.C. 12113(d), and the Weldon Amendment, among others.
Religious accommodations may also be sought under many of these
religious freedom and conscience protection laws.
(b) A faith-based organization may not use direct financial
assistance from the Department to support or engage in any
explicitly religious activities except when consistent with the
Establishment Clause and any other applicable requirements. Such an
organization also may not, in providing services funded by the
Department, discriminate against a program beneficiary or
prospective program beneficiary on the basis of religion, a
religious belief, a refusal to hold a religious belief, or a refusal
to attend or participate in a religious practice.
PART 61--VA HOMELESS PROVIDERS GRANT AND PER DIEM PROGRAM
0
58. The authority citation for part 61 continues to read as follows:
Authority: 38 U.S.C. 501, 2001, 2002, 2011, 2012, 2013, 2061,
2064.
0
59. Revise Sec. 61.64 to read as follows:
Sec. 61.64 Faith-based organizations.
(a) Organizations that are faith-based are eligible, on the same
basis as any other organization, to participate in VA programs under
this part. Decisions about awards of Federal 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 or lack thereof.
(b)(1) No organization may use direct financial assistance from VA
under this part to pay for any of the following:
(i) Explicitly religious activities such as, religious worship,
instruction, or proselytization; or
(ii) Equipment or supplies to be used for any of those activities.
(2) For purposes of this section, ``Indirect financial assistance''
means Federal financial assistance in which a service provider receives
program funds through a voucher, certificate, agreement or other form
of disbursement, as a result of the genuine, independent choice of a
private beneficiary. ``Direct Federal financial assistance'' means
Federal financial assistance received by an entity selected by the
Government or a pass-through entity as defined in 38 CFR 50.1(d) to
provide or carry out a service (e.g., by contract, grant, or
cooperative agreement). References to ``financial assistance'' will be
deemed to be references to direct Federal financial assistance, unless
the referenced assistance meets the definition of ``indirect Federal
financial assistance'' in this paragraph (b)(2).
(c) Organizations that engage in explicitly religious activities,
such as worship, religious instruction, or proselytization, must offer
those services separately in time or location from any programs or
services funded with direct financial assistance from VA, and
participation in any of the organization's explicitly religious
activities must be voluntary for the beneficiaries of a program or
service funded by direct financial assistance from VA.
(d) A faith-based organization that participates in VA programs
under this part will retain its independence from Federal, State, or
local governments and may continue to carry out its mission, including
the definition, practice and expression of its religious beliefs,
provided that it does not use direct financial assistance from VA under
this part to support any explicitly religious activities, such as
worship, religious instruction, or proselytization. Among
[[Page 82145]]
other things, faith-based organizations may use space in their
facilities to provide VA-funded services under this part, without
concealing, removing, or altering religious art, icons, scripture, or
other religious symbols. In addition, a VA-funded faith-based
organization retains its authority over its internal governance, and it
may retain religious terms in its organization's name, select its board
members and otherwise govern itself on a religious basis, and include
religious reference in its organization's mission statements and other
governing documents.
(e) An organization that participates in a VA program under this
part shall not, in providing direct program assistance, discriminate
against a program beneficiary or prospective program beneficiary
regarding housing, supportive services, or technical assistance, on the
basis of religion or religious belief.
(f) If a State or local government voluntarily contributes its own
funds to supplement federally funded activities, the State or local
government has the option to segregate the Federal funds or commingle
them. However, if the funds are commingled, this provision applies to
all of the commingled funds.
(g) To the extent otherwise permitted by Federal law, the
restrictions on explicitly religious activities set forth in this
section do not apply where VA funds are provided to faith-based
organizations through indirect assistance as a result of a genuine and
independent private choice of a beneficiary, provided the faith-based
organizations otherwise satisfy the requirements of this part. A faith-
based 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, or certificate, allowing the
beneficiary to direct where funds are to be paid, or a similar funding
mechanism provided to that beneficiary and designed to give that
beneficiary a choice among providers.
PART 62--SUPPORTIVE SERVICES FOR VETERAN FAMILIES PROGRAM
0
60. The authority citation for part 62 continues to read as follows:
Authority: 38 U.S.C. 501, 2044, and as noted in specific
sections.
0
61. Revise Sec. 62.62 to read as follows:
Sec. 62.62 Faith-based organizations
(a) Organizations that are faith-based are eligible, on the same
basis as any other organization, to participate in the Supportive
Services for Veteran Families Program under this part. Decisions about
awards of Federal 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 or lack thereof.
(b)(1) No organization may use direct financial assistance from VA
under this part to pay for any of the following:
(i) Explicitly religious activities such as, religious worship,
instruction, or proselytization; or
(ii) Equipment or supplies to be used for any of those activities.
(2) For purposes of this section, ``Indirect financial assistance''
means Federal financial assistance in which a service provider receives
program funds through a voucher, certificate, agreement or other form
of disbursement, as a result of the genuine, independent choice of a
private beneficiary. ``Direct Federal financial assistance'' means
Federal financial assistance received by an entity selected by the
Government or a pass-through entity as defined in 38 CFR 50.1(d) to
provide or carry out a service (e.g., by contract, grant, or
cooperative agreement). References to ``financial assistance'' will be
deemed to be references to direct Federal financial assistance, unless
the referenced assistance meets the definition of ``indirect Federal
financial assistance'' in this paragraph (b)(2).
(c) Organizations that engage in explicitly religious activities,
such as worship, religious instruction, or proselytization, must offer
those services separately in time or location from any programs or
services funded with direct financial assistance from VA under this
part, and participation in any of the organization's explicitly
religious activities must be voluntary for the beneficiaries of a
program or service funded by direct financial assistance from VA under
this part.
(d) A faith-based organization that participates in the Supportive
Services for Veteran Families Program under this part will retain its
independence from Federal, State, or local governments and may continue
to carry out its mission, including the definition, practice and
expression of its religious beliefs, provided that it does not use
direct financial assistance from VA under this part to support any
explicitly religious activities, such as worship, religious
instruction, or proselytization. Among other things, faith-based
organizations may use space in their facilities to provide VA-funded
services under this part, without concealing, removing, or altering
religious art, icons, scripture, or other religious symbols. In
addition, a VA-funded faith-based organization retains its authority
over its internal governance, and it may retain religious terms in its
organization's name, select its board members and otherwise govern
itself on a religious basis, and include religious reference in its
organization's mission statements and other governing documents.
(e) An organization that participates in a VA program under this
part shall not, in providing direct program assistance, discriminate
against a program beneficiary or prospective program beneficiary
regarding housing, supportive services, or technical assistance, on the
basis of religion or religious belief.
(f) If a State or local government voluntarily contributes its own
funds to supplement federally funded activities, the State or local
government has the option to segregate the Federal funds or commingle
them. However, if the funds are commingled, this provision applies to
all of the commingled funds.
(g) To the extent otherwise permitted by Federal law, the
restrictions on explicitly religious activities set forth in this
section do not apply where VA funds are provided to faith-based
organizations through indirect assistance as a result of a genuine and
independent private choice of a beneficiary, provided the faith-based
organizations otherwise satisfy the requirements of this part. A faith-
based 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, or certificate, allowing the
beneficiary to direct where funds are to be paid, or a similar funding
mechanism provided to that beneficiary and designed to give that
beneficiary a choice among providers.
DEPARTMENT OF HEALTH AND HUMAN SERVICES
For the reasons set forth in the preamble, HHS amends parts 87 and
1050 of title 45 of the CFR as follows:
PART 87--EQUAL TREATMENT FOR FAITH-BASED ORGANIZATIONS
0
62. The authority citation for part 87 is revised to read as follows:
Authority: 5 U.S.C. 301; 42 U.S.C. 2000bb et seq.
0
63. Revise Sec. 87.1 to read as follows:
Sec. 87.1 Definitions.
The following definitions apply for the purposes of this part.
(a) Direct Federal financial assistance, Federal financial
assistance provided directly, or direct funding means
[[Page 82146]]
financial assistance received by an entity selected by the Government
or a pass-through entity (as defined in this part) to carry out a
service (e.g., by contract, grant, or cooperative agreement).
References to Federal financial assistance will be deemed to be
references to direct Federal financial assistance, unless the
referenced assistance meets the definition of indirect Federal
financial assistance or Federal financial assistance provided
indirectly.
(b) Directly funded means funded by means of direct Federal
financial assistance.
(c) Indirect Federal financial assistance or Federal financial
assistance provided indirectly means financial assistance received by a
service provider when the service provider is paid for services
rendered by means of a voucher, certificate, or other means of
government-funded payment provided to a beneficiary who is able to make
a choice of a service provider.
(d) Federal financial assistance does not include a tax credit,
deduction, exemption, guaranty contract, or the use of any assistance
by any individual who is the ultimate beneficiary under any such
program.
(e) Pass-through entity means an entity, including a nonprofit or
nongovernmental organization, acting under a contract, grant, or other
agreement with the Federal Government or with a State or local
government, such as a State administering agency, that accepts direct
Federal financial assistance as a primary recipient or grantee and
distributes that assistance to other organizations that, in turn,
provide government funded social services.
(f) Recipient means a non-Federal entity that receives a Federal
award directly from a Federal awarding agency to carry out an activity
under a Federal program. The term recipient does not include
subrecipients, but does include pass-through entities.
(g) Religious exercise has the meaning given to the term in 42
U.S.C. 2000cc-5(7)(A).
0
64. Revise Sec. 87.3 to read as follows:
Sec. 87.3 Faith-based organizations and Federal financial
assistance.
(a) Faith-based organizations are eligible, on the same basis as
any other organization, and considering any permissible accommodation,
to participate in any HHS awarding agency program or service for which
they are otherwise eligible. The HHS awarding agency program or service
shall provide such accommodation as is consistent with Federal law, the
Attorney General's Memorandum of October 6, 2017 (Federal Law
Protections for Religious Liberty), and the Religion Clauses of the
First Amendment to the U.S. Constitution. Neither the HHS awarding
agency nor any State or local government or other pass-through entity
receiving funds under any HHS awarding agency program or service shall,
in the selection of service providers, discriminate against an
organization on the basis of the organization's religious character,
affiliation, or exercise. Notices or announcements of award
opportunities and notices of award or contracts shall include language
substantially similar to that in appendices A and B of this part. For
purposes of this part, to discriminate against an organization on the
basis of the organization's religious exercise means to disfavor an
organization, including by failing to select an organization,
disqualifying an organization, or imposing any condition or selection
criterion that otherwise disfavors or penalizes an organization in the
selection process or has such an effect:
(1) Because of conduct that would not be considered grounds to
disfavor a secular organization;
(2) Because of conduct that must or could be granted an appropriate
accommodation in a manner consistent with the Religious Freedom
Restoration Act (42 U.S.C. 2000bb through 2000bb-4) or the Religion
Clauses of the First Amendment to the Constitution; or
(3) Because of the actual or suspected religious motivation of the
organization's religious exercise.
(b) Organizations that receive direct financial assistance from an
HHS awarding agency may not engage in any explicitly religious
activities (including activities that involve overt religious content
such as worship, religious instruction, or proselytization) as part of
the programs or services funded with direct financial assistance from
the HHS awarding agency, or in any other manner prohibited by law. 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 the HHS awarding agency,
and participation must be voluntary for beneficiaries of the programs
or services funded with such assistance. The use of indirect Federal
financial assistance is not subject to this restriction. Nothing in
this part restricts HHS's authority under applicable Federal law to
fund activities, such as the provision of chaplaincy services, that can
be directly funded by the Government consistent with the Establishment
Clause.
(c) A faith-based organization that participates in HHS awarding-
agency funded programs or services will retain its autonomy; right of
expression; religious character; and independence from Federal, State,
and local governments, and may continue to carry out its mission,
including the definition, development, practice, and expression of its
religious beliefs. A faith-based organization may use space in its
facilities to provide programs or services funded with financial
assistance from the HHS awarding agency without concealing, removing,
or altering religious art, icons, scriptures, or other religious
symbols. Such a faith-based organization retains its authority over its
internal governance, and it may retain religious terms in its name,
select its board members on the basis of their acceptance of or
adherence to the religious tenets of the organization, and include
religious references in its mission statements and other governing
documents. In addition, a faith-based organization that receives
financial assistance from the HHS awarding agency does not lose the
protections of law.
Note 1 to paragraph (c): Memorandum for All Executive
Departments and Agencies, From the Attorney General, ``Federal Law
Protections for Religious Liberty'' (Oct. 6, 2017) (describing
Federal law protections for religious liberty).
(d) An organization, whether faith-based or not, that receives
Federal financial assistance shall not, with respect to services or
activities funded by such financial assistance, discriminate against a
program beneficiary or prospective program beneficiary on the basis of
religion, a religious belief, a refusal to hold a religious belief, or
a refusal to attend or participate in a religious practice. However, a
faith-based organization receiving indirect Federal financial
assistance need not modify any religious components or integration with
respect to its program activities to accommodate a beneficiary who
chooses to expend the indirect aid on the organization's program and
may require attendance at all activities that are fundamental to the
program.
(e) No grant document, agreement, covenant, memorandum of
understanding, policy, or regulation used by an HHS awarding agency or
a State or local government in administering Federal financial
assistance from the HHS awarding agency shall require faith-based
organizations to provide assurances or
[[Page 82147]]
notices where they are not required of non-faith-based organizations.
Any restrictions on the use of grant funds shall apply equally to
faith-based and non-faith-based organizations. All organizations,
whether faith-based or not, that participate in HHS awarding agency
programs or services must carry out eligible activities in accordance
with all program requirements (except where modified or exempted by any
required or appropriate religious accommodations) including those
prohibiting the use of direct Federal financial assistance to engage in
explicitly religious activities. No grant document, agreement,
covenant, memorandum of understanding, policy, or regulation used by an
HHS awarding agency or a State or local government in administering
Federal financial assistance from the HHS awarding agency shall
disqualify faith-based organizations from participating in the HHS
awarding agency's programs or services because such organizations are
motivated or influenced by religious faith to provide social services,
or because of their religious character or affiliation, or on grounds
that discriminate against organizations on the basis of the
organizations' religious exercise, as defined in this part.
(f) A faith-based organization's exemption from the Federal
prohibition on employment discrimination on the basis of religion, set
forth in the Civil Rights Act of 1964, 42 U.S.C. 2000e-1 and 2000e-2
and the Americans with Disabilities Act, 42 U.S.C. 12113(d)(2), is not
forfeited when the faith-based organization receives direct or indirect
Federal financial assistance from an HHS awarding agency. An
organization qualifying for such exemption may select its employees on
the basis of their acceptance of or adherence to the religious tenets
of the organization. Recipients should consult with the appropriate HHS
awarding agency program office if they have questions about the scope
of any applicable requirement, including in light of any additional
constitutional or statutory protections or requirements that may apply.
(g) In general, the HHS awarding agency does not require that a
recipient, including a faith-based organization, obtain tax-exempt
status under section 501(c)(3) of the Internal Revenue Code to be
eligible for funding under HHS awarding agency programs. Many grant
programs, however, do require an organization to be a nonprofit
organization in order to be eligible for funding. Funding announcements
and other grant application solicitations that require organizations to
have nonprofit status will specifically so indicate in the eligibility
section of the solicitation. In addition, any solicitation that
requires an organization to maintain tax-exempt status will expressly
state the statutory authority for requiring such status. Recipients
should consult with the appropriate HHS awarding agency program office
to determine the scope of any applicable requirements. In HHS awarding
agency programs in which an applicant must show that it is a nonprofit
organization, the applicant may do so by any of the following means:
(1) Proof that the Internal Revenue Service currently recognizes
the applicant as an organization to which contributions are tax
deductible under section 501(c)(3) of the Internal Revenue Code;
(2) A statement from a State or other governmental taxing body or
the State secretary of State certifying that:
(i) The organization is a nonprofit organization operating within
the State; and
(ii) No part of its net earnings may benefit any private
shareholder or individual;
(3) A certified copy of the applicant's certificate of
incorporation or similar document that clearly establishes the
nonprofit status of the applicant;
(4) Any item described in paragraphs (g)(1) through (3) of this
section, if that item applies to a State or national parent
organization, together with a statement by the State or parent
organization that the applicant is a local nonprofit affiliate; or
(5) For an entity that holds a sincerely held religious belief that
it cannot apply for a determination as an entity that is tax-exempt
under section 501(c)(3) of the Internal Revenue Code, evidence
sufficient to establish that the entity would otherwise qualify as a
nonprofit organization under any of paragraphs (g)(1) through (4) of
this section.
(h) If a recipient contributes its own funds in excess of those
funds required by a matching or grant agreement to supplement HHS
awarding agency-supported activities, the recipient has the option to
segregate those additional funds or commingle them with the Federal
award funds. 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 Federal funds. With
respect to the matching funds, the provisions of this part apply
irrespective of whether such funds are commingled with Federal funds or
segregated.
(i) Decisions about awards of direct Federal financial assistance
must be made on the basis of merit, not on the basis of the religious
affiliation, or lack thereof, of a recipient organization, and must be
free from political interference or even the appearance of such
interference.
(j) Neither the HHS awarding agency nor any State or local
government or other pass-through entity receiving funds under any HHS
awarding agency program or service shall construe these provisions in
such a way as to advantage or disadvantage faith-based organizations
affiliated with historic or well-established religions or sects in
comparison with other religions or sects.
(k) If a pass-through entity, acting under a contract, grant, or
other agreement with the Federal Government or with a State or local
government that is administering a program supported by Federal
financial assistance, is given the authority under the contract, grant,
or agreement to select non-governmental organizations to provide
services funded by the Federal Government, the pass-through entity must
ensure compliance with the provisions of this part and any implementing
regulations or guidance by the sub-recipient. If the pass-through
entity is a non-governmental organization, it retains all other rights
of a non-governmental organization under the program's statutory and
regulatory provisions.
0
65. Add Sec. 87.4 to read as follows:
Sec. 87.4 Severability.
Any provision of this part held to be invalid or unenforceable by
its terms, or as applied to any person or circumstance, shall be
construed so as to continue to give maximum effect to the provision
permitted by law, unless such holding shall be one of utter invalidity
or unenforceability, in which event the provision shall be severable
from this part and shall not affect the remainder thereof or the
application of the provision to other persons not similarly situated or
to other, dissimilar circumstances.
0
66. Add appendices A and B to part 87 to read as follows:
Appendix A to Part 87--Notice or Announcement of Award Opportunities
(a) Faith-based organizations may apply for this award on the
same basis as any other organization, as set forth at and, subject
to the protections and requirements of this part and 42 U.S.C.
2000bb et seq., the Department will not, in the selection of
recipients, discriminate against an organization on the basis of the
organization's religious character, affiliation, or exercise.
(b) A faith-based organization that participates in this program
will retain its independence from the Government and may
[[Page 82148]]
continue to carry out its mission consistent with religious freedom,
nondiscrimination, and conscience protections in Federal law,
including the Free Speech and Free Exercise Clauses of the First
Amendment of the U.S. Constitution, the Religious Freedom
Restoration Act (42 U.S.C. 2000bb et seq.), the Coats-Snowe
Amendment (42 U.S.C. 238n), Title VII of the Civil Rights Act of
1964 (42 U.S.C. 2000e-1(a) and 2000e-2(e)), the Americans with
Disabilities Act, 42 U.S.C. 12113(d)(2), section 1553 of the Patient
Protection and Affordable Care Act (42 U.S.C. 18113), the Weldon
Amendment (e.g., Further Consolidated Appropriations Act, 2020,
Public Law 116-94, 133 Stat. 2534, 2607, div. A, sec. 507(d) (Dec.
20, 2019)), or any related or similar Federal laws or regulations.
Religious accommodations may also be sought under many of these
religious freedom and conscience protection laws.
(c) A faith-based organization may not use direct financial
assistance from the Department to engage in any explicitly religious
activities (including activities that involve overt religious
content such as worship, religious instruction, or proselytization).
Such an organization also may not, in providing services funded by
the Department, discriminate against a program beneficiary or
prospective program beneficiary on the basis of religion, a
religious belief, a refusal to hold a religious belief, or a refusal
to attend or participate in a religious practice.
Appendix B to Part 87--Notice of Award or Contract
(a) A faith-based organization that participates in this program
retains its independence from the Government and may continue to
carry out its mission consistent with religious freedom,
nondiscrimination, and conscience protections in Federal law,
including the Free Speech and Free Exercise Clauses of the First
Amendment of the U.S. Constitution, the Religious Freedom
Restoration Act (42 U.S.C. 2000bb et seq.), the Coats-Snowe
Amendment (42 U.S.C. 238n), Title VII of the Civil Rights Act of
1964 (42 U.S.C. 2000e-1(a) and 2000e-2(e)), the Americans with
Disabilities Act (42 U.S.C. 12113(d)(2)), section 1553 of the
Patient Protection and Affordable Care Act (42 U.S.C. 18113), the
Weldon Amendment (see, e.g., Further Consolidated Appropriations
Act, 2020, Public Law 116-94, div. A, sec. 507(d), 133 Stat. 2534,
2607 (Dec. 20, 2019)), or any related or similar Federal laws or
regulations. Religious accommodations may also be sought under many
of these religious freedom, nondiscrimination, and conscience
protection laws.
(b) A faith-based organization may not use direct financial
assistance from the Department to engage in any explicitly religious
activities (including activities that involve overt religious
content such as worship, religious instruction, or proselytization).
Such an organization also may not, in providing services funded by
the Department, discriminate against a program beneficiary or
prospective program beneficiary on the basis of religion, a
religious belief, a refusal to hold a religious belief, or a refusal
to attend or participate in a religious practice.
PART 1050--CHARITABLE CHOICE UNDER THE COMMUNITY SERVICES BLOCK
GRANT ACT PROGRAMS
0
67. The authority citation for part 1050 continues to read as follows:
Authority: 42 U.S.C. 9901 et seq.
Sec. 1050.3 [Amended]
0
68. Amend Sec. 1050.3 in paragraph (h) by removing ``87.3(i) through
(l)'' and adding in its place ``87.3(i) and (j)''.
Dated: December 3, 2020.
Betsy DeVos,
Secretary, U.S. Department of Education.
Dated: December 3, 2020.
Chad F. Wolf,
Acting Secretary, U.S. Department of Homeland Security.
Dated: December 3, 2020.
Sonny Perdue,
Secretary, U.S. Department of Agriculture.
Dated: December 4, 2020.
Brian Klotz,
Deputy Director, Center for Faith & Opportunity Initiatives, U.S.
Agency for International Development
Benjamin S. Carson, Sr.,
Secretary, U.S. Department of Housing and Urban Development.
Dated: December 4, 2020.
William P. Barr,
Attorney General.
Dated: December 4, 2020.
Eugene Scalia,
Secretary, U.S. Department of Labor.
Dated: December 4, 2020.
Brooks D. Tucker,
Assistant Secretary for Congressional and Legislative Affairs,
Performing the Delegable Duties of the Chief of Staff, U.S. Department
Veterans Affairs.
Dated: December 4, 2020.
Alex M. Azar II,
Secretary, U.S. Department of Health and Human Services.
[FR Doc. 2020-27084 Filed 12-14-20; 8:45 am]
BILLING CODE 4410-01-P; 9112-FH-P; 3410-14-P; 6116-01-P; 4210-67-P;
4410-18-P; 4510-45; 8320-01-P; 4150-27-P