Stanley Carlson-Thies, July 8, 2016

The rules of the faith-based initiative, from the earliest days of Republican-sponsored Charitable Choice language enacted during the Clinton administration, have prohibited using federal grants to pay for religious activities and products. The Obama administration has just loosened that prohibition for overseas programs, saying that it is more restrictive than the Establishment Clause requires.

The change comes in a new regulation published by USAID on June 9, 2016. The general rule, confirmed in revised faith-based regulations that the Obama administration issued recently and that is based on US Supreme Court rulings, prohibits using federal grants to pay for “explicitly religious activities” such as worship and Bibles. Faith-based organizations can invite—not require—people being served in a federally funded program to participate in privately funded religious activities, and when the funding is via vouchers issued to beneficiaries, then the federal support can go to programs that include religion. But federal grants—direct funding to a private organization—are not to pay for religion because the Establishment Clause prohibits government from putting its weight on the side of a religion or religion generally.

There has been an exception that strict separationists have criticized: grant funds could help pay for facilities that include a religious use—for example, a multi-use building that includes a chapel—as long as the grant funds only paid for the areas not designated for the explicitly religious activities. It is this restriction that the new USAID regulation lifts: under certain circumstances, federal funds can be used to pay for facilities that are used for religion. It isn’t that the federal government will start funding the building of mosques or Baptist churches overseas under some theory that religion is good for peace and should be promoted in US foreign activities. It is rather that religion is not always a separable dimension of activities that the government should promote.

The new Final Rule gives two examples for why the change is needed. It is in the US national interest to foster a stronger public education system in Afghanistan, but since all schools in that system require a course in Islam, before the regulatory change a federal grant could not pay all the costs of constructing an Afghan public school. Similarly, before the change, USAID funds could not be used to comprehensively pay for the reconstruction of a public school in a Muslim country that was damaged by a natural disaster or a terrorist attack.

Interestingly, the administration’s rationale for the change in overseas policy is grounded in two Department of Justice Office of Legal Counsel (OLC) opinions concerning spending on religion within the United States. The Final Rule mentions a Second Circuit case (Lamont v. Woods, 1991) which says that the Establishment Clause can be applied more flexibly overseas, but then stresses the two OLC opinions.

In a 2002 opinion, the OLC said that it would not violate the Establishment Clause for FEMA to award a disaster assistance grant for the repair of the Seattle Hebrew Academy following an earthquake. And in a 2003 opinion, OLC said that the Establishment Clause did not prohibit awarding historic preservation grants to the Old North Church in Boston or to other houses of worship. In these instances, the federal funds would go for legitimate public purposes: assisting society in recovering from a natural disaster, in the one instance; protecting our national architectural heritage, in the other. That explicitly religious activities are integral to Seattle Hebrew Academy and Old North Church should not prohibit the government from promoting its own (nonreligious) public purposes.

On the logic of the OLC memos, the new flexibility in USAID grants should be extended to domestic federal grants. Is that change next to come?