TESTIMONY OF PROFESSOR IRA C. LUPU CONCERNING

THE CONSTITUTIONAL ROLE OF FAITH-BASED ORGANIZATIONS IN

COMPETITIONS FOR FEDERAL SOCIAL SERVICE FUNDS BEFORE THE SUBCOMMITTEE ON THE CONSTITUTION

OF THE COMMITTEE ON THE JUDICIARYUNITED STATES HOUSE OF REPRESENTATIVES

THURSDAY, JUNE 7, 2001

Mr. Chairman and members of the Subcommittee:

Thank you for the opportunity to testify on the constitutional role of faith-based organizations in competition for federal social service funds (commonly known as "Charitable Choice"). I am a professor of law at The George Washington University, but I am not here on behalf of the University or any other organization. I am here as a citizen and constitutional scholar, ⁽¹⁾ concerned about the questions before you.

Throughout our history, faith-based organizations have made impressive and deeply important contributions to social well-being in America. Many such organizations, along with their secular counterparts, have been especially committed to serving our most vulnerable and disadvantaged citizens. These organizations have helped alleviate the cruelties associated with poverty in America, and have aided countless people in making strides toward self-reliance and a better life.

Any involvement between religious organizations and government, however, raises serious constitutional issues under both the Establishment Clause and the Free Exercise Clause of the First Amendment. The inclusion of faith-based organizations in federally financed social service programs ⁽²⁾ implicates four categories of constitutional concern: 1) religious coercion, in violation of the Free Exercise Clause, of both beneficiaries and providers of federally funded social service programs; 2) government financial support and supervision, in violation of the Establishment Clause, of private activity with religious content; 3) the risks of sect-based discrimination by government officials against some faith-based providers seeking contracts with government; and 4) government involvement with religious discrimination in the employment practices of faith-based organizations. Moreover, these four categories of concern must be addressed in both the design and the implementation, at all levels of government, of any federal legislation of this character.

My conclusions, elaborated below, are that any such legislation: 1) should recognize the rights of program beneficiaries to be free of unwanted religious experience, and to have meaningful access to secular options for the receipt of federally financed services; 2) should recognize the rights of religious freedom of providers, up to the limits of the Establishment Clause; 3) should prohibit the use of federal funds to purchase materials with religious content or to compensate labor for services that include religious content; 4) should include specification of award criteria sufficient to provide safeguards against sectarian discrimination by award-granting officers; and 5) may EITHER forbid OR permit faith-based organizations to limit hiring to their coreligionists, whether or not the hiring is done with federal funds (i.e., the Constitution does not require either of those policy choices, and does permit the Congress to choose between them). With respect to all of the above issues, Congress should be mindful to design legislation with constitutional limits explicitly recognized and should be sensitive to the many ways in which administration of such schemes may touch upon constitutional values.

I. RESPECT FOR THE RELIGIOUS FREEDOM OF BENEFICIARIES.

Of all the issues presented by the inclusion of faith-based organizations in federal social service programs, this one produces the least disagreement. Proponents and opponents of such legislation concur that beneficiaries should never be forced to accept religiously influenced social services, or be forced to accept any such services in a religious setting. Accordingly, the 1996 Welfare Reform Act, and subsequent enactments or proposals of this variety, include provisions forbidding religious organizations from conditioning services upon a beneficiary's religious participation, ⁽³⁾ and provisions guaranteeing to beneficiaries the right to receive services from an alternative, secular provider. ⁽⁴⁾

The principal concern about the rights of beneficiaries involves the possibility that they will face subtle pressures to relinquish those rights. Beneficiaries may feel that they cannot object to religious content in the social services they are receiving without risking their benefits; moreover, the alternative secular providers typically required by law may be geographically remote or otherwise inaccessible to beneficiaries. Here, it is very important that there be clear rules, disclosed in advance to beneficiaries, that they need not participate or acquiesce in religious activities as a condition of receiving federally funded services. These requirements of disclosure should be written into every government contract with a faith-based organization, and failure to abide by such requirements should be made grounds for contract termination. It is also constitutionally necessary that state and local governments take affirmative steps to ensure that secular, alternative service providers are available and reasonably accessible to all, and that information about such providers is made readily available to beneficiaries.

II. RESPECT FOR THE RELIGIOUS AUTONOMY OF PROVIDERS.

This is a relatively new proposition in the discourse about the role of faith-based organizations in provision of government-financed service, and it is in some tension with Establishment Clause limits, discussed below, on that role. Despite that tension, I believe that existing and proposed Charitable Choice legislation is on sound ground in explicitly providing that religious providers do not have to surrender autonomy in matters of religious symbolism, internal governance, or theology in exchange for participation in a federally funded program. ⁽⁵⁾ Indeed, for the government to require alteration of religious trappings, governance, or teaching as a condition of participation might itself violate the Constitution, especially if the requirements extended to any part of the religious provider's enterprise that was not funded by the government. To put this another way, the government should not be using its power of the purse to induce religious providers to alter the iconography, internal governance or teachings of their faith, nor should government be creating disincentives for the provision of religiously themed social services, if such services are to be financed entirely with private support.

III. ESTABLISHMENT CLAUSE LIMITS ON RELIGIOUS CONTENT OF FEDERALLY FUNDED GOODS AND SERVICES.

The inclusion of faith-based providers in government social service programs raises subtle and difficult issues involving constitutional limitations, generated by the Establishment Clause, on government expenditures. Virtually all constitutional scholars agree that government may not finance sectarian proselytizing and worship, but the agreement quickly breaks down on issues of the more general scope of the prohibition of the Establishment Clause, and how best to enforce that prohibition.

Discourse over Establishment Clause limits typically divides into two camps, both of which tend to press their claims beyond the contours of existing law. One group, the strict separationists, argues that government may not directly finance the provision of secular goods and services in a sectarian setting, and argues further that the government may not directly aid "pervasively sectarian" organizations at all, because of the inseparability of the secular and sectarian in such organizations. The other group, the neutralists, argues that government must include religious providers (including the so-called "pervasively sectarian") in social programs on the same terms as secular providers, and that religious content of the programs should not be of concern to government so long as private parties create that religious content and no one is coerced into participation.

The law of the Establishment Clause is evolving in a way that is inconsistent with both of these polar positions. First, the Supreme Court has been moving toward permitting government to provide direct assistance to the secular functions of religious organizations. The Court's opinions in Bowen v. Kendrick, 487 U.S. 589 (1988), Agostini v. Felton, 521 U.S. 203 (1997), and most recently in Mitchell v. Helms, 530 U.S. 793 (2000), all uphold government provision of such assistance so long as the overall program is religion-neutral and there are programmatic safeguards against diversion of government aid to religious use. ⁽⁶⁾ Second, the Court has been moving away from a categorical prohibition on the distribution of government resources to so-called "pervasively sectarian" organizations. Although Bowen v. Kendrick, decided in 1988, had seemed to reinforce the vitality of that category, the recent decision in Mitchell v. Helms has undermined it considerably. In Mitchell, a four-Justice plurality repudiated the idea of a separate juridical category of "pervasively sectarian" organizations, ⁽⁷⁾ and the concurring Justices, while not joining in this explicit repudiation, refused to abide by any such categorization and approved of aid for secular educational purposes to highly sectarian schools.

Indeed, the categorical prohibition on direct government transfers to "pervasively sectarian" organizations is deeply flawed. Courts and agencies have no business trying to measure the degree of sectarianism of any particular group, especially when sectarian commitments are difficult to understand from the outside. Government may not finance religious exercises and practices, but questions of whether government is doing so should be analyzed program-by-program, practice-by-practice, rather than on the basis of gross generalizations about religious organizations as a whole.

The law of the Establishment Clause has thus been changing in ways that are consistent with the philosophy of Charitable Choice. Government may become a partner in the secular activities of faith-based organizations whose efforts advance secular purposes, but may not become a partner in -- nor regulate -- the private project of religious worship, transformation, and belief. These latter concerns, like matters encompassed by the right of privacy, are in our constitutional scheme beyond the scope of government's jurisdiction; such distinctively religious concerns must be left in private hands to ensure their integrity and to keep government within the bounds of the temporal. ⁽⁸⁾ Government may not act with the purpose or effect of "advancing or inhibiting religion," ⁽⁹⁾ and "excessive entanglement between government and religion" ⁽¹⁰⁾ will be among the criteria used to measure such "inhibition."

If these evolving principles are applied to Charitable Choice, certain conclusions and concerns follow. Foremost, the government may finance those aspects of social service programs that are secular in content (e.g., food, office supplies, secular educational materials), but it may NOT directly pay for goods or services with religious content. ⁽¹¹⁾ Thus, the provisions of existing and proposed law that prohibit government monies from being used for "sectarian worship, instruction, or proselytization" ⁽¹²⁾ are required by the Constitution, but do not go far enough. Government money may not be used to pay directly for any materials, any counseling, or any other services that incorporate concepts of divine, ultimate, or superhuman authority; the teachings of Alcoholics Anonymous, for example, which encourage participants to surrender their lives to divine custodianship, are not properly made the object of direct government support. ⁽¹³⁾

The distinction between secular goods and services, for which government may pay, and goods or services with religious content, for which government may not pay, bears acutely on the design of Charitable Choice programs. In light of the Supreme Court's repudiation of the concept that some organizations are so "pervasively sectarian" that they may never be the recipients of government assistance, contracts and programs should be designed to permit faith-based organizations, and those who monitor or audit them on behalf of the government, to separate expenditures into categories of those eligible for government support and those ineligible.

Goods and materials are obviously easier to monitor and label in these ways than are services, especially counseling services. Goods may be readily inspected for religious content without any governmental intrusion into private religious practices. The content of counseling services, by contrast, will be determined in part by individualized interactions between counselors and beneficiaries. ⁽¹⁴⁾ Moreover, some kinds of counseling more readily invites religious influence than others - for example, counseling those who have problems with substance abuse seems more likely to involve matters of the spirit than does job training. If there lurks a danger of "excessive entanglement" between government and faith-based organizations in Charitable Choice programs, the monitoring of counseling services is the flash point for that danger. Perhaps the best solution to this problem is a combination of clear guidelines to faith-based organizations regarding the required secularity of the content of their government-financed services, and a requirement that all organizations certify that such services have been rendered in compliance with such requirements. ⁽¹⁵⁾

In any event, such separation, monitoring and auditing of federally funded activities are essential to the constitutionality of particular grants, contracts, and practices. ⁽¹⁶⁾ If faith-based organizations are unwilling to tolerate such segregation and monitoring of their expenditures, they should not participate in government-financed programs. The auditing process should examine each program, not each faith-based provider viewed as a whole. Some programs operated by faith-based organizations may be so entirely infused with religiosity in their philosophy and methods of service that segregation of secular and religious expenditures will be impossible, at least with respect to counseling services. Teen Challenge, for example, is a well-publicized substance abuse program that has been described in precisely this way. ⁽¹⁷⁾ If government auditors are unable or unwilling to examine expenditures for religious content, government should not enter into these arrangements.

One additional concern arising under the Establishment Clause is that charitable choice programs may be thought to "endorse" religious belief in violation of the Constitution, in a way analogous to government support of sectarian religious symbols in public places. ⁽¹⁸⁾ I do not give such objections much credence. First, unlike government support of religious holidays or symbols, each instance of which can be identified and analyzed, Charitable Choice programs involve religion-neutral umbrellas under which many private programs are sponsored. Second, that the religious speech of religious organizations must be private - and privately financed --undermines the argument that it may be attributed to the government for Establishment Clause purposes. ⁽¹⁹⁾ If constitutional limitations concerning beneficiaries' rights and providers' duties are followed, beneficiaries and others should be able to discern that the government message in a charitable choice program is that secular gains will follow from the pursuit of work, abstention from drugs, etc., and that any religious message is separable, private, and attributable to the religious entity alone. ⁽²⁰⁾

IV. PREVENTING SECTARIAN DISCRIMINATION AGAINST PROVIDERS.

An issue that has been given insufficient attention in the Charitable Choice debate thus far arises from the danger that government contract officers will invidiously discriminate against certain religious denominations in the making of awards. It is easy to see how faiths that are widely adhered to and/or well-respected in a particular state or local community might have advantages in the competition for federal social service funds; inversely, faiths that are less widely followed in the U.S., either because they depart from our predominant Judeo-Christian tradition, or for some other reason become the target of bias or suspicion, may labor under comparable disadvantages. ⁽²¹⁾ Even if those authorized to enter into contracts on behalf of the government do not share any such bias, bureaucratic caution and fear of public criticism may lead such officers in the same direction. This sort of sectarian discrimination, whether overt or covert, is presumptively unconstitutional. ⁽²²⁾

Although nothing in any existing or proposed legislation authorizes such discrimination, there are not adequate safeguards against it. One such safeguard would involve tightening up the awards criteria utilized by contracting agencies. ⁽²³⁾ More precise criteria would facilitate the monitoring of contracting agencies and would likely improve their accountability to norms of nondiscrimination. This is a constitutional strategy widely used in the realm of freedom of speech and assembly, ⁽²⁴⁾ and would be salutary in this context as well. ⁽²⁵⁾ Congress should consider requiring all agencies, state or federal, which enter contracts with or make grants to faith-based organizations, to specify award criteria in ways that are sufficiently precise and transparent to permit evaluation of the religious evenhandedness with which they are employed.

V. HIRING DISCRIMINATION BY FAITH-BASED PROVIDERS.

Whether religious organizations may retain, in their government-funded programs, their statutory exemption from the federal ban on religious discrimination in employment is a hotly disputed matter. The issue raises concerns of freedom of association and workforce composition for such organizations, on the one hand, and government guarantees of equality of employment opportunity for those who might be hired to perform government-funded social services, on the other. Although current law leaves this precise question open, I believe that, with respect to employees compensated with funds originating from the federal government, Congress may either preserve the exemption to cover such employees or refuse to preserve it; that is, the decision about the scope of the exemption within Charitable Choice programs is a matter of policy, not a matter upon which the Constitution dictates a result one way or the other. ⁽²⁶⁾ I also believe that Congress should carefully gather information about the costs and benefits of these policy options before committing in full to either.

For most employers in the U.S., Title VII of the 1964 Civil Rights Act forbids discrimination based on religion. ⁽²⁷⁾ For those organizations whose purposes and activities are primarily religious, however, the same statute provides an exemption "with respect to the employment of individuals of a particular religion to perform work connected with the carrying on by such [organization] of its activities." ⁽²⁸⁾ Current Charitable Choice proposals preserve this exemption from the prohibition on religious discrimination in hiring to the federally funded activities of religious organizations. ⁽²⁹⁾

At first glance, the extension of the co-religionist exemption to government funded positions seems troubling indeed. Religious discrimination ordinarily runs counter to well-settled norms of equal employment opportunity in America. In most circumstances, such discrimination is unfair, invidious, and inefficient in its exclusion of highly qualified individuals from employment. When the employment is for activity designed to aid our neediest or most troubled citizens, exclusion of capable workers on religious grounds may undercut national purposes in delivering the best social services. Moreover, co-religionists within a faith-based organization may be more tempted than others to inject religious content into government-funded programs. Government itself may not discriminate based on religion in hiring for government positions, ⁽³⁰⁾ and the question arises whether government may authorize the use of tax dollars to do what government itself may not.

For a variety of reasons, however, extension of the co-religionist exemption to federally funded activities carried out in religious organizations does not offend the Constitution. First, discretionary action taken by private parties with the use of government funds ordinarily does not constitute "state action" subject to the Constitution. ⁽³¹⁾ The decision by a religious organization to limit hiring to co-religionists is not attributable to the government, even if government funds are paying the employees' salaries, unless the government requires the discrimination. Because the co-religionist exemption permits, but does not require private discrimination, the government cannot be held constitutionally responsible for it.

There are two possible exceptions to this principle suggested by current law. First, government may not subsidize private discrimination if the subsidy will tend to undercut some constitutional duty of the state. ⁽³²⁾ Second, if the state delegates exclusive functions of sovereignty to private parties, constitutional requirements (including those of nondiscrimination in employment) will attach to the delegation. ⁽³³⁾ Neither of these exceptions, however, fits the question of extending the co-religionist hiring exemption to federally funded social services. Discrimination in favor of co-religionists by some faith-based organizations does not undercut any state responsibility to ensure that it refrain from religious discrimination itself; rather, the exemption preserves the state's neutrality toward a particular private choice. And the provision of social services for the poor is far from an exclusive function of sovereignty; religious organizations have been instrumental in such activity for so long that one is tempted to say that support for social services involves the state in "religious action," rather than involving religious organizations in "state action." ⁽³⁴⁾

Second, there are affirmative reasons, rooted in freedom of religious association and national employment policy, to preserve the co-religionist exemption in government-financed programs. The existing co-religionist exemption in Title VII rests in part upon a judgment that religious organizations should be free to pursue religious cohesion and common values among their employees, whether or not such employees have religious duties. ⁽³⁵⁾ Of course, pursuant to Establishment Clause principles discussed above, employees are forbidden from engaging in explicitly religious activity on their government-financed time. Nevertheless, religious organizations may be religiously motivated in choosing to provide social services, whether or not the services themselves are intrinsically religious. Accordingly, the sense of community and religious spirit on which success of the group's efforts depend may be hampered by a requirement that members of all faiths be considered in hiring. To the extent this occurs, the overarching policy concern for the best possible provision of social services by religious organizations may be undermined.

Moreover, the employees working for religious organizations pursuant to government contracts may also be performing other duties that are privately financed. In such circumstances, elimination of the co-religionist exemption for government-funded jobs would force religious organizations to split employment opportunities between co-religionists in the privately financed positions and non-co-religionists in the government-financed jobs (with whatever inefficiencies such job-splitting entailed), or to hire non-co-religionists to do jobs formerly reserved for co-religionists. To the extent the co-religionist exemption is a means for harnessing the energy of faith in community service rather than merely a way to reserve employment for "members of the club," the creation of disincentives to hire co-religionists may undermine the private as well as the publicly supported activities of faith-based groups. ⁽³⁶⁾

Despite these considerations supporting the constitutionality of preserving the co-religionist exemption to government-financed employment positions, Congress may of course choose not to so preserve it. ⁽³⁷⁾ Whether or not the exemption is required by the Free Exercise Clause of the Constitution with respect to privately supported positions within religious organizations, ⁽³⁸⁾ Congress has the authority to impose full and complete nondiscrimination requirements with respect to government financed employment positions. Because religious organizations may forego such funding, or accept it and continue to hire only co-religionists for their privately financed positions, the free exercise rights of such organizations would not be unconstitutionally compromised by the failure to extend the co-religionist exemption to government financed employment. Conditioning government funds on full nondiscrimination in employment with those funds would obviously serve legitimate national interests in equal employment opportunity, and therefore would fall within the legislative prerogative.

Accordingly, Congress may constitutionally choose between 1) preserving the coreligionist exemption from nondiscrimination requirements within the federally financed activities of religious organizations, because the exemption may enhance these organizations' religious freedom, organizational efficiency, and service delivery; or 2) refusing to preserve the exemption in such programs, because it undercuts equality of employment opportunity and may actually lead to hiring those not best able to deliver social services to their intended beneficiaries. This choice is one for Congress to make, and is not dictated by the requirements of the Constitution. Instead, the choice should be controlled by a careful, empirical assessment of the relative costs and benefits of the various policy options. Because such an assessment has not, to my knowledge, yet been undertaken, I urge caution in the legislative approach to this delicate question.

VI. FACIAL VALIDITY VERSUS VALIDITY AS APPLIED.

The Supreme Court in Bowen v. Kendrick, 487 U.S. 589 (1988), emphasized the distinction between the facial validity of a government program which authorizes direct transfers of material assistance to religious organizations, among others, and the validity of particular grants made or contracts entered under such a program. The kinds of safeguards, alluded to above, which Congress has enacted in earlier Charitable Choice legislation will go a long way toward ensuring that any subsequent legislation will also survive attacks on its facial validity. Thus, provisions requiring 1) the inclusion of secular as well as religious providers, 2) respect for religious freedom of beneficiaries and providers, 3) prohibitions on religious content in goods and services for which funds directly transferred from government are spent, and 4) nondiscrimination in the distribution of funds will go a long way toward ensuring that the overall scheme will survive constitutional challenge. ⁽³⁹⁾

The Congress should be mindful, however, that much of what will go on in the contracting process, and even more of what will transpire in the actual delivery of these services, will be difficult to monitor and is unlikely to find its way into the courts. ⁽⁴⁰⁾ Beneficiaries may consent to unconstitutional practices, or may feel too dependent upon providers to complain even if they do not consent. Accordingly, any such legislation should provide for mechanisms of constitutional accountability, pursuant to which beneficiaries, providers, agencies of state and local government, civil liberties groups and others can be assured that constitutional concerns are being respectfully observed. ⁽⁴¹⁾ Such concerns should be rigorously enforced by government officers to whom beneficiaries and providers alike should have easy access. Moreover, the auditing practices used, auditing results obtained, and performance evaluations conducted by or for government agencies should be widely and readily accessible.

Financial Disclosure Form of Professor Ira C. Lupu

I have not received any government funds in support of my research on matters addressed in this testimony. Moreover, The George Washington University, where I am employed, has not received any government grants or contracts in connection with any of my research on this subject.

1. Much of my writing has focused on questions arising under the Religion Clauses of the Constitution. I (and my co-author Robert Tuttle) discuss the inclusion of faith-based organizations in federally financed social service projects in an article entitled "The Distinctive Place of Religious Entities in Our Constitutional Order," 46 Villanova Law Review, No, 5 (forthcoming, October, 2001).

2. Under current law, such organizations are explicitly included as eligible providers of services under the 1996 Welfare Reform Act, a variety of other services to low-income individuals and families pursuant to the Community Development Block Grant Act, and both federal grants and federally funded state grants to programs designed to treat substance abuse. The proposed Community Solutions Act of 2001, H.R. 7, 107^th Cong., 1^st sess. (hereafter "H.R. 7") would extend the explicit inclusion of faith-based providers to a wide range of additional federally funded services, including matters involving relief of hunger, control of crime and delinquency, domestic violence, and secondary school equivalence programs, among others. H.R. 7, sec. 201(c)(4).

3. This provision in the 1996 Welfare Reform Act is codified at 42 U.S.C. sec. 604a(g).

4. See, e.g., id. at sec. 604a(e)(1).

5. Id. secs. 604a(d)(1), 604a(d)(2)(A), 604a(d)(2)(B). Section 201(d) of H.R. 7 contains similar safeguards of the religious autonomy of providers.

6. A four-Justice plurality in Mitchell would have gone still further, and would permit private diversion of government assistance to religious use so long as the overall program is religion-neutral and the government aid itself lacks religious content. 530 U.S. at 820-24. The concurring opinion of Justice O'Connor, joined by Justice Breyer, rejected this view, and emphasized the no-diversion principle. Id. at 857-860. Grouped with the three dissenters inMitchell, the O'Connor-Breyer opinion means that a majority of the current Court would not approve of any program of aid to faith-based groups that would permit them to use the aid in explicitly religious ways.

7. Id. at 826-829. Chief Justice Rehnquist joined in this opinion, suggesting that he no longer takes the view, adopted in his opinion for the Court in Bowen v. Kendrick, that the Establishment Clause requires a categorical prohibition on government assistance to "pervasively sectarian" organizations. For my own view of the anti-Catholic bias associated with the origins of the concept of "pervasively sectarian" organizations, see Ira C. Lupu, The Increasingly Anachronistic Case Against School Vouchers, 13 Notre Dame J. of Law, Ethics, & Public Policy 375, 385-88 (1999).

8. The Supreme Court has long adhered to this proposition. See, e.g., Hunt v. NcNair, 413 U.S. 734, 743 (1973) (government may not fund "specifically religious activit[ies] in an otherwise substantially secular setting."); accord, Tilton v. Richardson, 403 U.S. 672 (1971).

9. Agostini, 521 U.S. at 222-223.

10. Id. at 234. See also Mitchell, 530 U.S. at 844-45 (O'Connor, J., joined by Breyer, J., concurring).

11. This testimony does not address the device of government vouchers, made available to service beneficiaries and redeemable by faith-based providers. Such a device, which involves the intervening private choice of beneficiaries in the selection of faith-based providers, appears to stand on safer constitutional ground than direct grants to, or contracts with, religious organizations, in which government officials themselves select religious providers. Even such voucher programs, however, must be designed to facilitate the purchase of social services with secular value. The validity of such voucher programs may well turn on the overall neutrality between faith-based and secular providers in the mix of those eligible to receive and redeem vouchers in any particular jurisdiction.

12. 42 U.S.C. at sec. 604a(j). See also H.R. 7, sec. 201(i) ("No funds provided through a grant or contract to a religious organization to provide assistance under any program described [herein] shall be expended for sectarian worship, instruction, or proselytization.")

13. For a recent and illustrative example of a court limiting government support for Alcoholics Anonymous, see DeStefano v. Emergency Housing Group, Inc., 247 F.3d 397 (2^ndCir. 2001). See also Warner v. Orange County Dept. of Probation, 115 F.3d 1068 (2d Cir. 1997), reaff'd after remand, 173 F.3d 120 (2^nd Cir), cert. denied, 528 U.S. 1003 (1999) (county may not condition probation on participation in Alcoholics Anonymous, because of AA's religious content).

14. In her crucial concurring opinion in Mitchell v. Helms, Justice O'Connor suggested a distinction between goods and services in her willingness to uphold the provision of educational materials to sectarian schools, while adhering to her ruling in Grand Rapids v. Ball, 473 U.S. 373 (1985), that government-financed salary supplements paid to teachers in such schools to teach secular subjects in after-school programs were unconstitutional. One might fairly presume, Justice O'Connor suggested, that such teachers would continue to advance the school's religious mission in the after school program. 530 U.S. at 857-860.

15. The facts of Mitchell v. Helms revealed that Louisiana had required all nonpublic schools to certify that the materials and equipment provided by the state would be used only for "secular, neutral, and nonideological purposes," as required by federal law, and Justice O'Connor's concurring opinion approved of this device to avoid excessive entanglements and help insure compliance with constitutional limits. 530 U.S. at 861-64.

16. There is a difference of constitutional stature between requirements of segregation of accounts - those reflecting only secular expenditures which government may lawfully make -- and requirements of allocation of expenditures between the religious and the secular. The latter would permit government to pay for one half of the overall expense for a clergy member's salary if one-half of the clergy member's work were secular. This sort of allocation is constitutionally insufficient, because such a scenario would not permit the confident assertion that government had not directly financed religious activity and because monitoring the allocation would invite impermissible government scrutiny of the work of the clergy. By contrast, account segregation only requires the government to look at the expenditures in the exclusively secular category to which government funds had been devoted. Indeed, H.R. 7 endeavors to respond precisely to these concerns by requiring segregation of government funds into a separate account or accounts, and providing that "[o]nly the government funds shall be subject to audit by the government." H.R. 7, Title II, sec. 201(h)(2).

17. See Charles Glenn, The Ambiguous Embrace: Government and Faith-Based Schools and Social Agencies (Princeton 2000), at 62-73; see also Charitable Choice Dance Begins, Christianity Today, April 2, 2001 (describing conflict among Teen Challenge leaders over whether to accept government funds, which in turn would force a secularization of their program).

18. Justice O'Connor suggested this analogy in her opinion for the Court in Agostini v. Felton, 521 U.S. 203, 235 (1997).

19. See Capitol Square Review and Advisory Bd. v. Pinette, 515 U.S. 753 (1995) (private religious speech in a public, state-owned forum cannot be attributed to the state).

20. Whatever force arguments based on government endorsement of religious speech may have in the setting of voucher programs to support private education, in which the mix of participating schools may be highly tilted toward the religious variety or towards a particular faith, see Simmons-Harris v. Zelman, 234 F.3d 945 (6^th Cir. 2000), both federal and statewide social service programs ordinarily include a wide variety of options, secular and otherwise, and overall government neutrality between religion and secularity is therefore much easier to identify and defend.

21. Some religious leaders have already expressed fears that Charitable Choice programs will lead to government financing of religious movements of which such leaders in some fashion disapprove. See Leslie Lenkowsky, Funding the Faithful, Why Bush is Right, Commentary, Vol. 111, No. 6 (June 2001) 19, 20. A survey done for the Pew Forum on Religion and Public Life reported recently that "Most Americans would not extend [the right to participate in government-financed social services] to . . . Muslim Americans, Buddhist Americans, Nation of Islam and the Church of Scientology. Many also have reservations about [including] the Church of Jesus Christ of Latter-Day Saints . . ." See Faith-Funding Backed, But Church-State Doubts Abound, wysiwyg://12/http://pewforum.org/events/0410/report/execsum.php3.

22. Church of the Lukumi Babalu Aye, Inc. v. City of Hialeah, 508 U.S. 520 (1993); Larson v. Valente, 456 U.S. 228 (1982). Related questions would arise if contracting officers systematically favored secular providers over religious providers, or systematically preferred the faith-based over the secular.

23. The criteria currently employed by government grantors and contracting agencies do not always inspire confidence in this regard. See, e.g., Department of Health and Human Services, Substance Abuse and Mental Health Services Administration, Center for Substance Abuse Prevention, Guidance for Applicants No. SP-01-006, Minority HIV Prevention Initiatives (Issued March 2001), at 9:

"Funding Criteria

Decisions to fund a grant are based on:

1. The strengths and weaknesses of the application as determined by the Peer Review Committee

2. Concurrence of the CSAP National Advisory Council

3. Availability of funds

4. Overall program balance in terms of geography and race/ethnicity of target populations."

24. See, e.g., Lakewood v. Plain dealer Publishing Co., 486 U.S. 750 (1988) (invalidating a city ordinance requiring a permit from the city's mayor in order to place newsracks on public property, because the permit scheme impermissibly conferred unbridled discretion on the mayor); Hague v. CIO, 307 U.S. 496 (1939) (holding unconstitutional a scheme requiring a permit for assemblies in the streets and parks, because the standards for permits did not adequately curb abuses of discretion); Saia v. New York, 334 U.S. 558 (1948) (invalidating ordinance requiring permit to use a sound truck because of inadequacy of standards to confine impermissible uses of discretion.).

25. See Walz v. Tax Comm'n of City of New York, 397 U.S. 664, 698-99 (1970) (Harlan, J., concurring) (remarking on the value of property tax exemptions for broad classes of property owners, including religious organizations, as a useful device for checking abuse of discretion by taxing officers, and suggesting that discretionary subsidies to religious organizations might invite such abuse).

26. An extremely thorough analysis of this question can be found in Memorandum for William P. Marshall, Deputy Counsel to the President, from Randolph D. Moss, Assistant Attorney General, Office of Legal Counsel, U.S. Department of Justice, Re: Application of the Coreligionists Exemption in Title VII of the Civil Right Act of 1964, 42 U.S.C. sec. 2000e-1, to Religious Organizations That Would Directly Receive Substance Abuse and Mental Health Services Administration Funds Pursuant to Section 704 of H.R. 4923, the "Community Renewal and New Markets Act of 2000" (copy on file with the author of this testimony).

27. Title VII, Civil Rights Act of 1964, sec. 703(a), 42 U.S.C. sec. 2000e-2(a).

28. Title VII of the Civil Rights Act of 1964, sec. 702(a), 42 U.S.C. sec. 2000e-1(a) (1994). The original statute enacted in 1964, limited the exemption to employees involved in carrying out "religious activities" of such organizations; the 1972 amendments to Title VII deleted the word "religious" as a modifier of activities in the exemption, so as to extend the exemption to employees engaged in any of their employers' activities. For discussion of the reasons for this extension, see Corporation of the Presiding Bishop of the Church of Jesus Christ of Latter-Day Saints v. Amos, 483 U.S. 327, 335-36 (1987).

29. None of these enactments or proposals would relieve religious organizations of other antidiscrimination norms, such as those which forbid discrimination based on race. See, e.g. H.R. 7, sec. 201(c)(3).

30. Such discrimination would violate the First Amendment's Religion Clauses, the Fifth Amendment's Due Process Clause, and the prohibition on Religious Tests for public office in Article VI.

31. See Rendell-Baker v. Kohn, 457 U.S. 830 (1982) (private school receiving over 90% of its funding from the state is not a state actor when it fires a teacher because of her speech activities); Blum v. Yaretsky, 457 U.S. 991 (1982) (private nursing home is not a state actor when it decides to transfer patients supported by Medicaid, a government-financed program, from one level of care to another).

32. See Norwood v. Harrison, 413 U.S. 455 (1973) (state which has engaged in de jure racial segregation in public schools may not lend textbooks to private segregated schools).

33. See Jackson v. Metropolitan Edison Co., 419 U.S. 345 (1974).

34. For a description of the role of religious organizations in the provision of such services in early America, see Marvin Olasky, The Tragedy of American Compassion (Regnery 1992), at 6-23.

35. See Amos, 483 U.S. at 340-46 (Brennan, J., concurring).

36. Extension of the coreligionist exemption to government financed employment within religious organizations may also be defended as an equalizer, putting such organizations on the same footing as ideological organizations which can favor their own sympathizers whether or not the employment positions are government-financed. The ACLU or the Sierra Club may limit hiring for all positions to those who share their beliefs, and the co-religionist exemption permits religious organizations to do likewise. To be sure, this argument is imperfect to the extent that religious affiliation is a matter of identity or narrow theological creed rather than general religious sentiment; the coreligionist exemption permits exclusion by religious organizations of those who share all of their social values, and their enthusiasm for such values, but who do not share their particular method of worship. Nevertheless, religious organizations are uniquely situated in connection with the question of religious discrimination in employment, and this uniqueness provides a constitutionally sufficient reason to treat them differently from secular organizations for these purposes.

37. In at least one case of federal grants for which faith-based organizations are explicitly eligible, Congress has indeed chosen not to so preserve the exemption. With respect to "formula grants" made to the states by the Substance Abuse and Mental Health Services Administration of the Department of Health and Human Services, religious discrimination is completely prohibited. 42 U.S.C. sec. 300x-57(a)(2) (1994).

38. With respect to clergy positions, the courts have held that exemption from all nondiscrimination law is constitutionally required. See, e.g., Rayburn v. General Conference of Seventh Day Adventists, 772 F.2d 1164 (4^th Cir. 1985), cert. denied, 478 U.S. 1020 (1986).

39. By contrast, self-serving declarations like those in H.R. 7 concerning whether receipt of government funds constitutes aid to the receiving organization (as contrasted with its beneficiaries), see sec. 201(c)(2), or whether receipt of such funds constitutes government endorsement of religious belief, id. at sec. 201(c)(3), add nothing to the facial validity of congressional enactments. The questions addressed by such provisions must be independently asked and answered by the courts in appropriate circumstances.

40. There have been lawsuits arising over the application of Charitable Choice programs within particular religious providers. See Funding of Faith Works Challenged, Milwaukee Journal Sentinel, Oct. 13, 2000 (describing lawsuit against Wisconsin for aiding the religious activities of Faith Works, an addiction recovery program); 'Charitable Choice' Gets Challenge; Suit targets state spending on church-based social work, Dallas Morning News, July 25, 2000, p. 23A (describing suit against Texas officials for supporting religious activities in the Jobs Partnership of Washington County, Texas.) Such suits do not necessarily signify that courts generally can police these matters effectively, nor do such suits, if successful, necessarily mean that violations of the Constitution within such programs are widespread.

41. State and local contracting agencies in particular need concrete guidance concerning relevant constitutional limitations. The current Charitable Choice contract in the State of Texas, for example, purports to limit the religiosity of the efforts of faith-based organizations performed under contract with the state by providing that "The purpose of this contract is the provision of social services; no state expenditures have as their objective the funding of sectarian worship, instruction, or proselytization." Texas Department of Human Services, Contract for Local Innovation Projects, Section II.F. (copy on file with the author of this testimony). This provision, which focuses on state purposes rather than provider behavior, seems wholly inadequate as a mechanism for communicating to providers that their state-financed efforts -- means as well as ends -- must be entirely secular in content. I do not attribute this choice of language in the Texas contract to any sort of constitutional bad faith; rather, it seems to me to reflect a lack of awareness or a deep uncertainty on the part of state officers of precisely what the Constitution requires of them in these circumstances.