With Republicans taking control of the Senate, President Bush's stalled proposal to increase federal funding of faith-based organizations likely moves to the front burner. In the meantime, however, the administration is moving forward with administrative reforms of agency grant programs.
“We really want the legislation badly,” Jim Towey, director of the White House’s faith-based office, told the Washington Post on Aug. 31, “but this office isn’t just about federal legislation. This office is going to more forward with the president’s initiative.”
In fact, as early as August 2001, the White House indicated its intent to implement at least some of its initiative administratively, releasing a report from Towey’s office called “Unlevel Playing Field: Barriers to Participation by Faith-Based and Community Organizations in Federal Social Service Programs.” The report argues that one of the major problems facing faith-based organizations is “needlessly burdensome administrative creations,” adding that “Federal agencies should use grants to underwrite the most effective programs” regardless of religious character.
In one of its first actions, back in January of 2001, the administration established offices for dealing with faith-based and community organizations (FBCI) in five cabinet agencies -- Health and Human Services, Labor, Education, Justice, and Housing and Urban Development. These offices appear to be pursuing the administrative reforms advised by the White House. Specifically, the administration has:
- Possibly misused congressional appropriations (i.e., the Compassion Capital Fund) to promote the president's agenda;
- Sought to create faith-based set-asides;
- Provided seemingly insufficient accountability measures for Compassion Capital Fund grantees;
- Heightened training efforts for faith-based groups on how to apply for federal grants; and
- Potentially undermined laws on employment discrimination for federal grantees.
Misusing the Compassion Capital Fund
Critical in the administration’s effort is the brand new Compassion Capital Fund, which distributed $30 million to charitable organizations this past year. Congress created this fund -- which is administered by HHS -- to develop “best practices” for social service charities, advising organizations on the most successful methods of operation. Nonetheless, the administration appears to be using it as a springboard for promoting its faith-based agenda.
Of the $30 million, $24.8 million was distributed among 21 intermediary organizations to provide technical assistance and help faith-based and community organizations to "effectively access funding sources, operate and manage their programs, develop and train staff, expand the reach of programs into the community and replicate promising programs." The intermediary organizations will also issue sub-grants to support start-up costs and operation or expansion of existing programs run by faith-based and community organizations -- activities that go beyond congressional intent.
Without accountability measures for these intermediary organizations, and how they distribute money, the door is wide open for abuse. In fact, there is evidence that the administration intends to use the Compassion Capital Fund for political purposes.
During the summer, for instance, the Republican Party in South Carolina sponsored a “seminar on faith-based and community initiatives” attended by about 100 ministers and charity leaders. Jeremy White of the White House Office for Faith-Based and Community Initiatives was the keynote speaker, and according to the The State newspaper in Columbia, focused on how pastors can “get their part of $30 million in federal money,” referring to the Compassion Capital Fund. A follow-up mailing from Ron Thomas, political director of the South Carolina GOP, provided more details on how to apply for federal funds. Church and State (published by Americans United for Separation of Church and State) noted that the event was geared toward African-American pastors as part of the GOP’s “outreach” program.
At another seminar this summer, hosted by the Department of Health and Human Services in Minnesota, Church and State reported that, "The Rev. Floyd Blair, an African American minister and a Bush HHS official, was seen … literally directing African American religious leaders to special sessions for exclusive information. Blair also spoke extensively about the Compassion Capital Fund to attendees, calling the available tax dollars 'faith money.' " At another event focused on how to apply for federal funds, Americans United staff reported that staff from the White House's faith-based office urged those attending to lobby for passage of the Charity Aid, Recovery, and Empowerment Act of 2002 (CARE Act), a charitable giving and faith-based bill stalled in the Senate. Agency employees are generally prohibited from lobbying, and more investigation is needed to determine if there has been a violation of law in this instance.
These events suggest that the White House is using federal funds to give special preference to religious congregations, raising further questions about the linkage to the 2004 election. With the Compassion Capital Fund poised to grow to $150 million in FY 2003, and possibly more in FY 2004, the potential for abuse is significant and the need for scrutiny critical.
Faith Based Set-Asides
The administration has attempted to set aside grant funds that would be available only to faith-based organizations. These plans were withdrawn when objections were raised, but it’s still possible such set asides could happen informally given the administration’s clear preference.
In January, for example, the Administration for Children and Families at HHS issued a program announcement setting aside $210,000 to promote partnerships between community action agencies and faith-based organizations. Americans United for Separation of Church and State sent HHS a letter noting that the government is barred from using standards that favor religious groups over secular ones. The letter also noted three other attempts by the Department to create faith-based only grant opportunities.
Several states have taken similar actions as well, creating separate funding streams only for faith-based providers. New Jersey set up its own Office of Faith Based and Community Initiatives to award $2.5 million in state grants to faith-based providers, and North Carolina likewise set aside $2.54 million in TANF funds for faith-based organizations.
Lack of Accountability for Grantees
One of the major problems with the administrative implementation of the administration’s faith-based plan has been the lack of clear definitions, starting with exactly what composes a “Faith-Based and/or Community Organization.” While some programs are operating with almost no definitions, others have established concrete guidelines. There is no statutory definition that applies across all programs, and inconsistent standards have emerged.
As noted above, the major grantees of the Compassion Capital Fund have been charged with issuing sub-grants to smaller organizations to support start-up costs and operation or expansion of existing programs. The issuance of sub-grants goes beyond the authorizing legislation for the Compassion Capital Fund. In a colloquy during Senate consideration of the Labor-HHS appropriation bill (which funded the Compassion Capital Fund), Chairman Tom Harkin (D-IA) stated, “The goal of grantees of the Compassion Capital Fund will be to improve the effectiveness of social programs and community initiatives around the nation,” adding “this fund is only for the development of model best practices.” Sen. Arlen Specter (R-PA) stated, “It is important to note that this appropriations bill is not changing any of the rules or standards for government funding of religious organizations…” However, the intermediary grantees have been given almost no guidance in the grant announcement, only that “funds shall not be used to support religious practices such as religious instruction, worship or prayer.”
Another major problem with the intermediary grants is that they are much more difficult to track to ensure proper use and compliance with regulations. The Roundtable on Religion and Social Welfare Policy, a non-partisan research organization, has released a report on government funding of faith-based social services, stating in their press release that “it is nearly impossible to track how most of the money is being used.” The study cites the use of large grants to intermediaries (governments or organizations) that are then split into sub-grants to smaller organizations, difficulties in tracking indirect financial support (such as vouchers), and in even determining if a grantee is indeed a faith-based organization. In summing up the report, Richard Nathan, director of the Rockefeller Institute, which oversees the Roundtable states, “Despite some general knowledge about the amounts being given to faith-based social service providers, little is known about where the dollars eventually go after they leave Washington.”
Federal grant rules -- such as cost principles that identify unallowable expenses -- are supposed to follow the federal dollar wherever it goes. However, it is rare that subgrantees and subcontractors are held accountable to federal standards. Thus, any re-granting initiative runs enormous risk of remaining largely unmonitored and unaccountable.
At a panel discussion sponsored by the Roundtable in September, the heads of all five agencies with faith-based centers indicated that they will rely more on intermediaries to implement the president’s agenda.
Training on the Grants Process
While faith-based legislation languishes in the Senate, the agency-level faith-based offices are gradually becoming more engaged. The Department of Education, for example, has held several conferences teaching faith-based and community organizations (FBCOs) how to apply for federal grants. In October, the White House faith-based office, in conjunction with the five agency offices, held a large conference on federal grants for FBCOs in Atlanta, with four more conferences planned throughout the country, including one in Philadelphia on Dec. 12. According to a Sept. 15 Washington Post article, a series of similar workshops in at least six states have stirred controversy because they featured officials from the faith-based program but were sponsored by state Republican parties or featured GOP candidates, and were targeted at minority audiences (a July 19 conference sponsored by the South Carolina GOP invited 1600 black ministers).
States have reported similar actions. Indiana, Virginia and Texas have all conducted workshops on funding for faith-based organizations. Virginia and Indiana have also created handbooks targeting new faith-based service providers with help on applying for government funding and writing grants. Our calls to obtain agendas, participant lists, and how the sessions were announced were not answered. The lack of transparency raises many questions about the training sessions.
Employment Discrimination
In the area of employment discrimination, the Department of Education’s faith-based program has interpreted existing legislation so broadly that the meaning of the law has changed. Historically, under Title VII of the Civil Rights Act, religious congregations can discriminate based on religious affiliation when hiring for positions that involve worship-related skills or activities. For example, a synagogue can hire only Jewish rabbis. While the Title VII limitations may make sense for certain religious hiring, it only applies to the use of private funds. Now the administration would like to allow federal funds to be used to discriminate in religious hiring, which is a complex, less clear matter.
Early this year, the Department of Education omitted civil rights protection requirements in the 21st Century After School Program grant announcement. The authorizing law, the “Leave No Child Behind Act of 2001,” calls for federal aid for after-school and tutoring services run by schools, businesses and “community-based organizations,” language that the administration has interpreted to include churches and other faith-based organizations. The administration also assumed that those organizations should be allowed to discriminate in hiring for federally-funded programs based on an applicant’s religion.
After the grant announcement for the program was released, a coalition of civil rights, education and other organizations wrote to Education Secretary Rod Paige requesting that the program’s guidance be amended to include the civil rights standards that were included in the Act. The Department responded that the civil rights provision “does not purport to prohibit discrimination” and that prohibiting discrimination would be akin to “creating a new and independent civil rights law” for programs funded under the Elementary and Secondary Education Act. The result is that grantees can discriminate based on religion in hiring decisions for government-funded positions. In a letter to the secretary, Sen. Ted Kennedy (D-MA) argued that this interpretation “effectively nullifies” the civil rights language approved by Congress in the education bill.
John Porter, director of the Department’s faith-based office, told the Associated Press on July 24 that the debate over church and state issues is an “inside-the-beltway, partisan, theoretical debate that extremist groups engage in,” adding that “particularly in the African-American and Hispanic community, they just don’t get this thing about church and state.”
The Department of Labor has provided a different model. On July 1, DOL awarded three sets of grants to faith-based and community organizations through the Workforce Investment Act. Unlike other agencies, Labor’s grant announcement provided a definition of a “grassroots” faith-based or community organization (if the organization has a social services budget of $300,000 or less, has six or fewer full-time equivalent employees, is headquartered in the local community, and is not a local affiliate of a national organization). The grant announcement was also amended to prohibit the use of grant money for “instruction in religion or sacred literature, worship, prayer, proselytizing or other inherently religious practices,” and to state that grant recipients “may not and will not be defined by reference to religion.” In addition, the amended grant announcement makes it clear that religion may not be a requirement for receiving benefits or consideration for employment in the program.
Congress has already addressed the issue. The National and Community Service Act of 1990 expressly prohibits discrimination based on religion by grantees in providing benefits and hiring of staff for federally-funded positions. In late May, Rep. Peter Hoekstra (R-MI), chair of the House Education and Workforce Committee’s Subcommittee on Education, unsuccessfully sought repeal of this language in the Citizens Service Act (H.R. 4854), the recently approved reauthorization of the program. Hoekstra’s proposal would have eliminated requirements that grant applicants file statements certifying that program funds would not be used to provide a direct benefit to “instruction as part of a program that includes religious worship” or to “construct or operate facilities devoted to religious worship and to maintain facilities primarily or inherently devoted to religious instruction or worship.” (Title 42 Chapter 129 Section 12584). He did not propose elimination of the ban on using federal funds for direct religious instruction or proselytization. The proposal was withdrawn in the face of a major public fight and opposition from Ranking Member George Miller (D-CA) and Rep. Bobby Scott (D-VA). The conservative Family Research Council furiously responded, claiming the “AmeriCorpse” bill “should not become the standard for the President’s faith-based efforts.”
The concern over employment discrimination with federal funds is just one example of how the Bush administration can use executive branch powers to alter public policy. The grant award letter of new grantees, including those receiving financial assistance under the Compassion Capital Fund, need to be inspected. Are all federal grants rules being equally applied? Have any rules or requirements been changed within a grant program, an agency, or government-wide? At a time when transparency and accountability is essential, we are getting none.
