
Federal Grant Rules in the Courts
by Guest Blogger, 5/16/2006
Decision Favors Charity, Another Case Challenges OMB Favoritism for Faith-Based Groups
In a victory for nonprofit advocacy rights, a sweeping restriction on the privately-funded speech of nonprofits that participate in the U.S. government's international HIV/AIDS program has been held in violation of the First Amendment. Meanwhile, a challenge is being mounted against an OMB grading system allegedly used to encourage an increase in government funding to religious charities.
Federal Court Holds "Pledge Requirement" Violates First Amendment
On May 9, a federal judge ruled that the United States Agency for International Development (USAID) violated the First Amendment by requiring public health groups to pledge their "opposition to prostitution" in order to continue receiving federal funds for their HIV prevention work. Under the USAID requirement, recipients of federal funds were forced to censor even their speech funded with privately raised dollars when discussing the most effective ways to engage high-risk groups in HIV prevention. While the court's decision applies directly only to the two organizations involved in the litigation, it could have a broad impact on many other organizations also forced to sacrifice their privately funded speech in order to receive government funds.
In his opinion, Judge Victor Marrero of the U.S. District Court for the Southern District of New York found that the Supreme Court "has repeatedly found that speech, or an agreement not to speak, cannot be compelled or coerced as a condition of participation in a government program." The court found that the pledge requirement violates the First Amendment rights of two plaintiff organizations, Alliance for Open Society International (AOSI) and Pathfinder International, by restricting their privately-funded speech and by forcing them to adopt the government's viewpoint in order to remain eligible for funds.
Marrero determined that a preliminary injunction against the enforcement of the pledge requirement was necessary to prevent AOSI and Pathfinder from suffering irreparable harm, and asked both sides to propose the terms of the specific injunctive relief within two weeks in conformity with the ruling. The injunction will block the government from demanding the groups take the pledge while the legal case continues.
The ruling stems from a Sept. 2005 lawsuit challenging a provision in the United States Leadership Against HIV/AIDS, Tuberculosis, and Malaria Act of 2003 that required organizations to pledge their opposition to sex trafficking and prostitution or lose federal funding. The pledge was immediately applied to foreign aid recipients, and now also affects private U.S. organizations conducting AIDS programs overseas. The plaintiffs have adopted policies acknowledging prostitution's harms but object to being told how to execute them.
A Challenge to OMB's Faith-Based "Report Card"
In related news, a lawsuit brought by the Freedom From Religion Foundation challenges the intrusion of OMB's influence in government grants. On May 4, Freedom From Religion Foundation (FFRF) filed a lawsuit charging the Office of Management and Budget with violating constitutional provisions separating church and state by using government funds to promote religion.
OMB gives a "report card" to each major federal agency--such as the Department of Education--in which OMB grades the agencies on the extent to which they have disbursed and/or increased their appropriations to faith-based organizations. It is unclear whether OMB gives report cards for secular groups applying for the same funds.
The lawsuit alleges that OMB's actions are tantamount to official support for and advocacy of religion, because they are intended to cause increased disbursements to organizations merely because they are faith-based. Report cards, by definition, measure success against a standard that agencies are expected to achieve, and according to FFRF, the grading system creates "an atmosphere intended to cause federal agencies to increase their contracting with faith-based organizations merely because the organizations are faith-based."
