Equal Opportunity for Religious Organizations in USDA Programs: Implementation of E.O. 13559, 47243-47252 [2015-18262]

Download as PDF Vol. 80 Thursday, No. 151 August 6, 2015 Part VI Department of Agriculture mstockstill on DSK4VPTVN1PROD with PROPOSALS4 Office of the Secretary 7 CFR Part 16 Equal Opportunity for Religious Organizations in USDA Programs: Implementation of E.O.13559; Proposed Rule VerDate Sep<11>2014 20:40 Aug 05, 2015 Jkt 235001 PO 00000 Frm 00001 Fmt 4717 Sfmt 4717 E:\FR\FM\06AUP4.SGM 06AUP4 47244 Federal Register / Vol. 80, No. 151 / Thursday, August 6, 2015 / Proposed Rules DEPARTMENT OF AGRICULTURE Office of the Secretary 7 CFR Part 16 RIN 0503–AA55 Equal Opportunity for Religious Organizations in USDA Programs: Implementation of E.O. 13559 Office of the Secretary, USDA. Proposed rule. AGENCY: ACTION: This rule proposes to revise USDA’s regulation that covers equal opportunity for participation of faithbased (religious) organizations in USDA programs. These revisions are being undertaken to implement Executive Order 13559, Fundamental Principles and Policymaking Criteria for Partnerships with Faith-Based and Other Neighborhood Organizations. Executive Order 13559 amended Executive Order 13279, Equal Protection of the Laws for Faith-Based and Community Organizations, which provides the legal basis for USDA’s current equal participation regulations to protect religious liberty rights of beneficiaries of USDA funded programs. This rule adopts changes to Executive Order 13279 made by Executive Order 13559, including changes to specific terminology, additional beneficiary protections, and clarifications on the responsibilities of intermediaries. In addition to proposing regulatory amendments to implement Executive Order 13559, USDA is also publishing for public comment a Paperwork Reduction Act information collection notice of beneficiary protections for use by religious organizations. DATES: Comment Due Date. October 5, 2015. SUMMARY: Interested persons are invited to submit comments regarding this proposed rule to as indicated below. Instructions for submitting public comments on the information collection notice are set forth in Section III.h. There are two methods for submitting public comments on this proposed rule. All submissions must refer to the above docket number and title. 1. Submission of Comments by Mail. Comments may be submitted by mail to Norah Deluhery, Director, Center for Faith-Based and Neighborhood Partnerships, U.S. Department of Agriculture, 1400 Independence Avenue SW., Washington, DC 20250. 2. Electronic Submission of Comments. Interested persons may submit comments electronically through mstockstill on DSK4VPTVN1PROD with PROPOSALS4 ADDRESSES: VerDate Sep<11>2014 20:40 Aug 05, 2015 Jkt 235001 the Federal eRulemaking Portal at www.regulations.gov. USDA strongly encourages commenters to submit comments electronically. Electronic submission of comments allows the commenter maximum time to prepare and submit a comment, ensures timely receipt by USDA, and enables USDA to make them immediately available to the public. Comments submitted electronically through the www.regulations.gov Web site can be viewed by other commenters and interested members of the public. Commenters should follow the instructions provided on that site to submit comments electronically. Note: To receive consideration as public comments, comments must be submitted through one of the two methods specified above. Again, all submissions must refer to RIN 0503–AA55 and the title of this rule. No Facsimile Comments. Facsimile (FAX) comments will not be accepted. FOR FURTHER INFORMATION CONTACT: Norah Deluhery, Director, Center for Faith-Based and Neighborhood Partnerships, U.S. Department of Agriculture, 1400 Independence Avenue SW., Washington, DC 20250; telephone number (202) 720–2032 (this is not a toll-free number). Persons with disabilities or who require alternative means of communication (Braille, large print, audio tape, etc.) should contact the USDA Target Center at (202) 720– 2600 (voice and TDD). I. Supplementary Information Background On December 12, 2002, President George W. Bush signed Executive Order 13279, ‘‘Equal Protection of the Laws for Faith-Based and Community Organizations,’’ which was published on December 16, 2002, at 67 FR 77141. Executive Order 13279 set forth the principles and policymaking criteria to guide Federal agencies in formulating and developing policies with implications for faith-based organizations and other community organizations, to ensure equal protection of the laws for faith-based and other 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 relating to Federal financial assistance for social services programs and, where appropriate, to implement new policies that were consistent with, and necessary to, the furthering of the fundamental principles and PO 00000 Frm 00002 Fmt 4701 Sfmt 4702 policymaking criteria that have implications for faith-based and community organizations. Also on December 12, 2002, President Bush signed Executive Order 13280 (67 FR 77145), ‘‘Responsibilities of the Department of Agriculture and the Agency for International Development, with Respect to Faith-Based and Community Initiatives,’’ which created a Center for Faith-Based and Community Initiatives at USDA and charged USDA to identify and eliminate regulatory, contracting, and other programmatic barriers to full participation of faith-based and community organizations in its programs. USDA implemented Executive Order 13279 through the final rule, Equal Opportunity for Religious Organizations, published on July 9, 2004, at 69 FR 41375, and added USDA’s regulations in 7 CFR part 16. The regulations established by that rule provide the following: (1) Faithbased (religious) organizations are eligible on the same basis as any other eligible organization to participate in USDA programs and activities; (2) religious organizations that participate in USDA programs or activities may retain their independence; (3) a religious organization that participates in a USDA program does not forfeit its exemption from the prohibition on employment discrimination on the basis of religion, as provided in Title VII of the Civil Rights Act of 1964 (though some individual USDA programs may have independent statutory nondiscrimination requirements); (4) organizations may not discriminate against beneficiaries or prospective beneficiaries on the basis of religion or religious beliefs; (5) organizations may not engage in inherently religious activities as part of programs or services directly funded under a USDA program or activity. On February 5, 2009, President Barack Obama signed Executive Order 13498, entitled ‘‘Amendments to Executive Order 13199 and Establishment of the President’s Advisory Council for FaithBased and Neighborhood Partnerships,’’ which was published on February 9, 2009, at 74 FR 6533. Executive Order 13498 established the President’s Advisory Council for Faith-Based and Neighborhood Partnerships (Advisory Council) for the purpose of bringing together experts to, among other things, make recommendations to the President for changes in policies, programs, and practices that affect the delivery of services by faith-based and other neighborhood organizations. E:\FR\FM\06AUP4.SGM 06AUP4 mstockstill on DSK4VPTVN1PROD with PROPOSALS4 Federal Register / Vol. 80, No. 151 / Thursday, August 6, 2015 / Proposed Rules In March of 2010, the Advisory Council issued its recommendations in a report entitled ‘‘A New Era of Partnerships: Report of Recommendations to the President.’’ 1 The Advisory Council Report included recommendations to amend Executive Order 13279 in order to clarify the legal foundation of partnerships and offered a new set of fundamental principles to guide agency decision-making in administering Federal financial assistance and support to faith-based and neighborhood organizations. On November 17, 2010, President Obama signed Executive Order 13559, entitled ‘‘Fundamental Principles and Policymaking Criteria for Partnerships with Faith-Based and Other Neighborhood Organizations,’’ which was published on November 22, 2010, at 75 FR 71319.2 Executive Order 13559 incorporated many of the Advisory Council’s recommendations and amended Executive Order 13279 to include additional Fundamental Principles and Policymaking Criteria for inclusion in guidance and regulations.3 The principles include, as follows: • The Federal Government has an obligation to monitor and enforce all standards regarding the relationship between religion and government in ways that avoid excessive entanglement between religious bodies and governmental entities; • Organizations engaging in explicitly religious activity must separate these activities in time or location from programs supported with direct Federal financial assistance (including prime awards and sub-awards), participation in any explicit religious activity cannot be subsidized with direct Federal financial assistance (including prime awards and sub-awards), and participation in such activities must be voluntary for the beneficiaries of the social service program supported with such Federal financial assistance; • Religious providers are welcome to compete for Federal Government social service funding and maintain a religious identity as described in the order; • Agencies that administer or award Federal financial assistance for social service programs must implement protections for the beneficiaries or prospective beneficiaries of those programs (these protections include providing referrals to alternate providers if the beneficiary objects to the religious character of the organization providing 1 http://www.whitehouse.gov/sites/default/files/ microsites/ofbnp-council-final-report.pdf. 2 http://www.gpo.gov/fdsys/pkg/FR-2010-11-22/ pdf/2010-29579.pdf. 3 Executive Order 13279, Section 2 paragraphs (e)–(j). VerDate Sep<11>2014 20:40 Aug 05, 2015 Jkt 235001 services, and ensuring that written notice of these and other protections is provided to beneficiaries before they enroll in or receive services from the program); • Agencies that provide Federal financial assistance for social service programs must post online regulations, guidance documents, and policies that have implications for faith-based and neighborhood organizations and must post online a list of entities receiving such assistance; and • Agency 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 the religious affiliation, or lack of affiliation, of the recipient organization. In addition, Executive Order 13559 created the Interagency Working Group on Faith-Based and Other Neighborhood Partnerships (Working Group) for the purpose of reviewing and evaluating existing regulations, guidance documents, and policies. The Executive Order also stated that, following receipt of the Working Group’s report, the Office of Management and Budget (OMB), in coordination with the U.S. Department of Justice, must issue guidance to agencies on the implementation of Executive Order 13559. The Working Group issued its report in April of 2012.4 In August of 2013, OMB issued guidance instructing specified agency heads to do the following: (1) Adopt regulations and guidance that will fulfill the requirements of Executive Order 13559 and (2) amend regulations and guidance to ensure that they are consistent with this executive order.5 II. Discussion of Proposed Rule A. Overview of Proposed Regulations This proposed rule updates 7 CFR part 16 to reflect the new Fundamental Principles and Policymaking Criteria in Executive Order 13559. Some of the principles do not require regulations and may be included in guidance issued by the Department. USDA implements Executive Order 13559 in 7 CFR part 16 by: (1) Adding definitions for USDA direct assistance, 4 Recommendations of the Interagency Working Group on Faith-Based Organizations and Other Neighborhood Partnerships, April 2012, at http:// www.whitehouse.gov/sites/default/files/uploads/ finalfaithbasedworkinggroupreport.pdf. 5 M–13–19, ‘‘Implementation of Executive Order 13559, ‘Fundamental Principles and Policymaking Criteria for Partnerships with Faith-based and Other Neighborhood Organizations’ ’’, August 2, 2013, at http://www.whitehouse.gov/sites/default/files/omb/ memoranda/2013/m-13-19.pdf. PO 00000 Frm 00003 Fmt 4701 Sfmt 4702 47245 USDA indirect assistance, and intermediary; (2) including a new requirement that decisions must be free from political interference or even the appearance of such interference; (3) clarifying the separation of explicitly religious activities from activities funded with USDA direct assistance and defining explicitly religious activities; (4) clarifying the responsibilities of intermediary organizations; (5) adding new beneficiary protections, and (6) amending existing language in 7 CFR part 16 to include the Executive Order 13559 changes. The Department may issue guidance on the applicability of the executive order and the rule to particular programs. B. Specific Proposed Amendments 1. New Definitions This proposed rule adds definitions for ‘‘USDA direct assistance,’’ ‘‘USDA indirect assistance,’’ and ‘‘intermediary’’ at 7 CFR 16.2. Executive Order 13559 noted that new regulations should distinguish between ‘‘direct’’ and ‘‘indirect’’ Federal financial assistance because the limitation on explicitly religious activities applies to programs that are supported with ‘‘direct’’ Federal financial assistance but does not apply to programs supported with ‘‘indirect’’ Federal financial assistance. To clarify this distinction, the proposed rule provides definitions of these terms. Programs are supported with USDA direct assistance when either the Federal Government or an intermediary, as identified in this proposed rule, selects a service provider and either purchases services from that provider (e.g., through a contract), or awards funds to that provider to carry out an activity (e.g., through a contract, grant, sub-grant, or cooperative agreement). Under these circumstances, there are no intervening steps in which the beneficiary’s choice determines the provider’s identity. Indirect Federal financial assistance is distinguishable because it places the choice of service provider in the hands of a beneficiary before the Federal Government pays for the cost of that service through a voucher, certificate, or other similar means. For example, the government could choose to allow the beneficiary to secure the needed service on his or her own. Alternatively, a Federal governmental agency, operating under a neutral program of aid, could present each beneficiary or prospective beneficiary with a list of all qualified providers from which the beneficiary could obtain services using a government-provided certificate. Either E:\FR\FM\06AUP4.SGM 06AUP4 mstockstill on DSK4VPTVN1PROD with PROPOSALS4 47246 Federal Register / Vol. 80, No. 151 / Thursday, August 6, 2015 / Proposed Rules way, the Federal Government empowers the beneficiaries to choose for themselves whether to receive the needed services, including those that contain explicitly religious activities, through a faith-based or other neighborhood organization. The Federal Government could then pay for the beneficiary’s choice of provider by giving the beneficiary a voucher or similar document. Alternatively, the government could choose to pay the provider directly after asking the beneficiary to indicate the beneficiary’s choice.6 The Supreme Court has held that if a program meets certain criteria, the Federal Government may fund the program if, among other things, the program places the benefit in the hands of individuals, who, in turn, have the freedom to choose the provider from which they receive their benefit and ‘‘spend’’ the Federal Government funds, whether that provider is public or private, non-religious or religious.7 In these instances, the Federal Government does not encourage or promote any explicitly religious programs that may be among the options available to beneficiaries. Notably, the voucher scheme at issue in the Zelman decision, which was described by the Court as one of ‘‘true private choice,’’ 8 was also neutral toward religion and offered beneficiaries adequate secular options. This type of Federal financial assistance is considered ‘‘indirect’’ within the meaning of the Establishment Clause of the First Amendment of the U.S. Constitution. Accordingly, these criteria also are included in the text of the proposed definition of ‘‘USDA indirect assistance.’’ The Department also proposes regulatory language that will clarify the responsibilities of intermediaries. An intermediary is 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 Federal financial assistance and distributes that assistance to other organizations that, in turn, provide government-funded social services. Each intermediary must abide by all statutory and regulatory requirements by, for example, providing any services supported with direct Federal financial assistance in a religiously neutral manner that does not include explicitly religious activities. The intermediary 6 See Freedom From Religion Found. v. McCallum, 324 F.3d 880, 882 (7th Cir. 2003). 7 See Zelman v. Simmons-Harris, 536 U.S. 639, 652–53 (2002). 8 Id. at 653. VerDate Sep<11>2014 20:40 Aug 05, 2015 Jkt 235001 also has the same duties as the government to comply with these rules by, for example, selecting any providers to receive Federal financial assistance in a manner that does not favor or disfavor organizations on the basis of religion or religious belief. While intermediaries may be used to distribute Federal financial assistance to other organizations in some programs, intermediaries remain accountable for the Federal financial assistance they disburse. Accordingly, intermediaries must ensure that any providers to which they disburse Federal financial assistance also comply with these rules. If the intermediary is a nongovernmental organization, it retains all other rights of a non-governmental organization under the statutory and regulatory provisions governing the program. A State’s use of intermediaries does not relieve the State of its traditional responsibility to effectively monitor the actions of such organizations. States are obligated to manage the day-to-day operations of grant- and sub-grantsupported activities to ensure compliance with applicable Federal requirements and performance goals. Moreover, a State’s use of intermediaries does not relieve the State of its responsibility to ensure that providers are selected, and deliver services, in a manner consistent with the First Amendment’s Establishment Clause. 2. Decisions Must Be Free From Political Interference This proposed rule adds to the existing paragraph (a) of 7 CFR 16.2, redesignated as § 16.3 under the proposed rule, a sentence clarifying that decisions about awards of Federal financial assistance must be free from political interference or even the appearance of such interference. To comply with this requirement, awarding entities, including intermediaries, should instruct participants in the awarding process to refrain from taking religious affiliations or non-religious affiliations into account in this process; i.e., an organization should not receive favorable or unfavorable marks merely because it is affiliated or unaffiliated with a religious body, or related or unrelated to a specific religion. Additionally, when selecting peer reviewers, the awarding entity should never ask about religious affiliation or take such matters into account, but the awarding entity should encourage religious, political, and professional diversity among peer reviewers by advertising for these positions in a wide variety of venues. PO 00000 Frm 00004 Fmt 4701 Sfmt 4702 3. Separation of Explicitly Religious Activities From Activities Funded With Direct Federal Financial Assistance and Definition of ‘‘Explicitly Religious Activities’’ This proposed rule would amend paragraph (b) in 7 CFR 16.2, redesignated as § 16.3, and paragraphs (b) and (d)(1) in § 16.3, redesignated as § 16.4, to clarify the requirement that activities supported by direct Federal financial assistance must be separate from explicitly religious activities, define ‘‘explicitly religious activities,’’ and replace the term ‘‘inherently religious activities’’ with the term ‘‘explicitly religious activities.’’ Executive Order 13559 makes clear that all organizations that receive Federal financial assistance are prohibited from discriminating against beneficiaries or potential beneficiaries of Federal programs on the basis of religion, a religious belief, refusal to hold a religious belief, or a refusal to attend or participate in a religious practice. The Executive Order also states that organizations offering explicitly religious activities (including activities that involve overt religious content such as worship, religious instruction, or proselytization) must not use direct Federal financial assistance to subsidize or support those activities, and that any explicitly religious activities must be offered outside of programs that are supported with direct Federal financial assistance (including through prime awards or sub-awards). In other words, to the extent that an organization provides explicitly religious activities, those activities must be offered separately in time or location from programs or services supported with direct Federal financial assistance. USDA’s existing regulations at 7 CFR part 16 and Executive Order 13279, prohibit nongovernmental organizations from using direct Federal financial assistance (e.g., government grants, contracts, sub-grants, and subcontracts) for ‘‘inherently religious activities, such as worship, religious instruction, and proselytization.’’ The term ‘‘inherently religious,’’ however, has proven confusing. In 2006, for example, the Government Accountability Office (GAO) found that while all 26 of the religious social service providers GAO interviewed indicated they understood the prohibition on using direct Federal financial assistance for ‘‘inherently religious activities,’’ four of the providers described acting in ways that appeared to violate that rule.9 9 GAO, Faith-Based and Community Initiative: Improvements in Monitoring Grantees and Measuring Performance Could Enhance E:\FR\FM\06AUP4.SGM 06AUP4 mstockstill on DSK4VPTVN1PROD with PROPOSALS4 Federal Register / Vol. 80, No. 151 / Thursday, August 6, 2015 / Proposed Rules Further, while the Supreme Court has sometimes used the term ‘‘inherently religious,’’ the Court has not used this term to indicate the boundary of what the Federal Government may subsidize with direct Federal financial assistance. If the term is interpreted narrowly, it could permit actions that the Constitution prohibits. On the other hand, one could also argue that the term ‘‘inherently religious’’ is too broad rather than too narrow. For example, some might consider their provision of a hot meal to a needy person to be an ‘‘inherently religious’’ act when it is undertaken from a sense of religious motivation or obligation, even though it has no overt religious content. The Court has determined that the Government cannot subsidize ‘‘a specifically religious activity in an otherwise substantially secular setting.’’ 10 The Court has also said a direct aid program impermissibly advances religion when the aid results in governmental indoctrination of religion.11 This terminology is fairly interpreted to prohibit the Federal Government from directly subsidizing any ‘‘explicitly religious activity,’’ including activities that involve overt religious content. Thus, direct Federal financial assistance should not be used to pay for activities such as religious instruction, devotional exercises, worship, proselytizing or evangelism; production or dissemination of devotional guides or other religious materials; or counseling in which counselors introduce religious content. Similarly, direct Federal financial assistance may not be used to pay for equipment or supplies to the extent they are allocated to such activities. Activities that are secular in content, such as serving meals to the needy or using a non-religious text to teach someone to read, are not considered ‘‘explicitly religious activities’’ merely because the provider is religiously motivated to provide those services. The study or acknowledgment of religion as a historical or cultural reality also would not be considered an explicitly religious activity. Notwithstanding the general prohibition on the use of direct Federal financial assistance to support explicitly religious activities, there are times when religious activities may be Federally Accountability, GAO–06–616, at 34–35 (June 2006) (available at http://www.gao.gov/new.items/ d06616.pdf). 10 Hunt v. McNair, 413 U.S. 734, 743 (1973). 11 See Mitchell v. Helms, 530 U.S. 793, 808 (2000) (Thomas, J., joined by Rehnquist, C.J., Scalia, and Kennedy, J.J., plurality); id. at 845 (O’Connor, J., joined by Breyer, J., concurring in the judgment); Agostini v. Felton, 521 U.S. 203, 223 (1997). VerDate Sep<11>2014 20:40 Aug 05, 2015 Jkt 235001 financed under the Establishment Clause and not subject to the direct Federal financial assistance restrictions—for instance, in situations where Federal financial assistance is provided to chaplains to work with inmates in prisons, detention facilities, or community correction centers through social service programs.12 Likewise, it is important to emphasize that the restrictions on explicit religious content apply to content generated by the administrators of the program receiving direct Federal financial assistance, not to spontaneous comments made by individual beneficiaries about their personal lives in the context of these programs. For example, if a person administering a Federally funded job skills program asks beneficiaries to describe how they gain the motivation necessary for their job searches and some beneficiaries refer to their faith or membership in a faith community, these kinds of comments do not violate the restrictions and should not be censored. In this context, it is clear that the administrator of the Federal Government-funded program did not orchestrate or encourage such comments. USDA, therefore, proposes to replace the term ‘‘inherently religious activities’’ with the term ‘‘explicitly religious activities’’ and define the latter term as ‘‘including activities that involve overt religious content such as worship, religious instruction, or proselytization.’’ These changes in language will provide greater clarity and more closely match constitutional standards as they have been developed in case law. These restrictions would not diminish existing regulatory protections for the religious identity of faith-based providers. The proposed rule would not affect, for example, organizations’ ability to use religious terms in their organizational names, select board 12 Where there is extensive government control over the environment of the Federally-financed social service program, program officials may sometimes need to take affirmative steps to provide an opportunity for beneficiaries of the social service program to exercise their religion. See Cruz v. Beto, 405 U.S. 319, 322 n.2 (1972) (per curiam) (‘‘reasonable opportunities must be afforded to all prisoners to exercise the religious freedom guaranteed by the First and Fourteenth Amendment without fear of penalty’’); Katcoff v. Marsh, 755 F.2d 223, 234 (2d Cir. 1985) (finding it ‘‘readily apparent’’ that the Government is obligated by the First Amendment to ‘‘to make religion available to soldiers who have been moved by the Army to areas of the world where religion of their own denominations is not available to them’’). Without such efforts, religious freedom might not exist for these beneficiaries. Accordingly, services such as chaplaincy services would not be considered explicitly religious activities that are subject to direct financial aid restrictions. PO 00000 Frm 00005 Fmt 4701 Sfmt 4702 47247 members on a religious basis, include religious references in mission statements and other organizational documents, and post religious art, messages, scriptures, and symbols in buildings where Federal financial assistance is delivered. 4. New Beneficiary Protections This rule proposes to add new paragraphs (f) and (g) to § 16.3, redesignated as § 16.4 under this proposed rule, implementing a variety of valuable protections for the religious liberty rights of social service beneficiaries. These protections are aimed at ensuring that Federal financial assistance is not used to coerce or pressure beneficiaries along religious lines, and to make beneficiaries aware of their rights, through appropriate notice, when potentially obtaining services from providers with a religious affiliation. Executive Order 13559 requires that faith-based organizations administering a program that is supported by direct Federal financial assistance give written notice, in a manner prescribed by the agency, to beneficiaries and prospective beneficiaries, of their right to be referred to an alternate provider when available. Written notice should be provided prior to enrollment or receipt of services. However, when the nature of the service provided or exigent circumstances make it impracticable to provide such written notice in advance of the actual service, service providers must advise beneficiaries of their protections at the earliest available opportunity. A sample notification of beneficiary rights is attached in Appendix A. In addition, there is a limited exception to the individual notice requirement at § 16.4(f). When the service provided involves only a brief interaction between the service provider and the beneficiary, and the beneficiary is receiving what may be a one-time service from the provider (such as a meal at an emergency kitchen, or onetime assistance with rent, mortgage payments, or utility bills), the service provider may post the written notice of beneficiary protections in a prominent place, in lieu of providing individual written notice to each beneficiary. Such posting does not relieve an organization of its obligations under the remainder of this part. If a beneficiary or prospective beneficiary of a social service program supported by Federal financial assistance objects to the religious character of an organization that provides services under the program, the beneficiary must be referred to an alternate provider. More specifically, E:\FR\FM\06AUP4.SGM 06AUP4 47248 Federal Register / Vol. 80, No. 151 / Thursday, August 6, 2015 / Proposed Rules the proposed rule provides that, if a beneficiary or prospective beneficiary of a program supported by direct Federal financial assistance objects to the religious character of an organization that provides services under the program, that organization shall within a reasonably prompt time undertake reasonable efforts to identify and refer the beneficiary to an alternate provider. Further, the executive order and the proposed rule require the relevant awarding entity to ensure that appropriate and timely referrals are made to an appropriate provider, and that referrals are made in a manner consistent with applicable privacy laws and regulations. When appropriate, USDA may require the awarding entity to provide organizations information about alternate providers, and the organization that provides services may rely on that information to fulfill its duty under this proposed rule. For example, in the case of The Emergency Food Assistance Program (TEFAP), a State Distributing Agency may provide contact information for beneficiaries of publicly available Web sites or telephone ‘‘hotlines’’ that direct individuals to local emergency kitchens or pantries, a list of the emergency kitchens or pantries to which the State Distributing Agency distributes food, or another applicable directory or list of food assistance. It must be noted that in some instances, the awarding entity may also be unable to identify a suitable alternate provider within a reasonable geographic proximity. 5. Amending Existing 7 CFR Part 16 To Include Executive Order 13559 Changes USDA also proposes to amend the other paragraphs in 7 CFR part 16 to include the new Executive Order 13559 principles and to make clarifying changes, including the replacement of the term ‘‘inherently religious’’ with ‘‘explicitly religious,’’ and adding the term ‘‘USDA direct assistance’’ where appropriate. III. Regulatory Information mstockstill on DSK4VPTVN1PROD with PROPOSALS4 A. Executive Orders 12866 and 13563: Regulatory Planning and Review Executive Order 12866, ‘‘Regulatory Planning and Review,’’ and Executive Order 13563, ‘‘Improving Regulation and Regulatory Review,’’ direct agencies to assess all costs and benefits of available regulatory alternatives and, if regulation is necessary, to select regulatory approaches that maximize net benefits (including potential economic, environmental, public health and safety effects, distributive impacts, VerDate Sep<11>2014 20:40 Aug 05, 2015 Jkt 235001 and equity). Executive Order 13563 emphasized the importance of quantifying both costs and benefits, reducing costs, harmonizing rules, and promoting flexibility. The Office of Management and Budget (OMB) designated this rule as not significant under Executive Order 12866 and, therefore, OMB has not reviewed this proposed rule. B. Clarity of the Regulation Executive Order 12866, as supplemented by Executive Order 13563, requires each agency to write all rules in plain language. In addition to your substantive comments on these proposed rules, we invite your answers in response to the questions below, as comments. For example: • Are the requirements in the rule clearly stated? Are the scope and intent of the rule clear? • Does the rule contain technical language or jargon that is not clear? • Is the material logically organized? • Would changing the grouping or order of sections or adding headings make the rule easier to understand? • Could we improve clarity by adding tables, lists, or diagrams? • Would more, but shorter, sections be better? Are there specific sections that are too long or confusing? • What else could we do to make the rule easier to understand? C. Regulatory Flexibility Act The Regulatory Flexibility Act (5 U.S.C. 601–612), as amended by the Small Business Regulatory Enforcement Fairness Act of 1996 (SBREFA), generally requires an agency to prepare a regulatory flexibility analysis of any rule subject to the notice and comment rulemaking requirements under the Administrative Procedure Act (5 U.S.C. 553) or any other statute, unless the agency certifies that the rule will not have a significant economic impact on a substantial number of small entities. USDA has determined that this rule will not have a significant impact on a substantial number of small entities. Consequently, USDA has not prepared a regulatory flexibility analysis. D. Executive Order 12988: Civil Justice Reform This proposed rule has been reviewed in accordance with Executive Order 12988, ‘‘Civil Justice Reform.’’ The provisions of this proposed rule will not have preemptive effect with respect to any State or local laws, regulations, or policies that conflict with such provision or which otherwise impede their full implementation. The rule will not have retroactive effect. PO 00000 Frm 00006 Fmt 4701 Sfmt 4702 E. Executive Order 13132: Federalism This rule has been reviewed under Executive Order 13132, ‘‘Federalism.’’ The policies contained in this rule would not have any substantial direct effect on States, on the relationship between the Federal Government and the States, or on the distribution of power and responsibilities among the various levels of government. Also, this rule would not impose substantial direct compliance costs on State and local governments. Therefore, consultation with the States is not required. F. Executive Order 12372: Intergovernmental Review of Federal Programs Executive Order 12372, ‘‘Intergovernmental Review of Federal Programs,’’ requires consultation with State and local officials. The objectives of the Executive Order are to foster an intergovernmental partnership and a strengthened Federalism, by relying on State and local processes for State and local government coordination and review of proposed Federal financial assistance and direct Federal development. For reasons set forth in the Notice to 7 CFR part 3015, subpart V (48 FR 29115, June 24, 1983), the programs and activities within this rule are excluded from the scope of Executive Order 12372. G. Executive Order 13175: Consultation and Coordination With Indian Tribal Governments This rule has been reviewed for compliance with Executive Order 13175, ‘‘Consultation and Coordination with Indian Tribal Governments.’’ The Executive Order imposes requirements on the development of regulatory policies that have Tribal implications or preempt Tribal laws. The USDA Office of Tribal Relations has concluded that the policies contained in this rule do not, to our knowledge, preempt Tribal law. H. Paperwork Reduction Act (PRA) In accordance with the Paperwork Reduction Act (PRA) of 1995 (44 U.S.C. Chapter 35, as amended), an agency may not conduct or sponsor a collection of information, and a person is not required to respond to a collection of information, unless the collection displays a currently valid OMB control number. The new information collection requirements contained in the proposed rule have been submitted to OMB for review, pursuant to 44 U.S.C. 3507(d). The proposed rule includes a new information collection section. Sections 16.4(f) and (g) would impose requirements on faith-based E:\FR\FM\06AUP4.SGM 06AUP4 Federal Register / Vol. 80, No. 151 / Thursday, August 6, 2015 / Proposed Rules organizations that carry out activities under a USDA program with direct Federal financial assistance to give beneficiaries (or prospective beneficiaries) written notice of certain protections described in this proposed rule. Beneficiaries can provide a written response that may impose a burden under the PRA, and faith-based organizations must provide a referral if a beneficiary or prospective beneficiary objects to the religious character of the organization. USDA estimates that a faith-based organization would need 2 minutes to distribute to each beneficiary the notice required in these proposed regulations. This estimate takes into consideration the likelihood that, in one-on-one interactions between a staff member and a beneficiary, providing the notice might take longer than a minute. Conversely, providing notice to a group of beneficiaries at the same time would take significantly less than a minute for each beneficiary because a few beneficiaries would pass the notice to the remaining beneficiaries in a group. USDA estimates that in cases where a beneficiary objects to the religious character of a faith-based organization, the time required for the faith-based organization to make a reasonable effort to identify an alternate provider and refer a beneficiary to that provider would be about 2 hours. This estimate includes the time required to identify service providers that provide similar services, preferably under the same or similar programs, to the one under which the beneficiary is being served by the faith-based organization. This estimate includes the time required in a situation where the beneficiary asks the faith-based organization to follow up either with the beneficiary or the alternative service provider in order to determine whether the referral was successful. The U.S. Department of Health and Human Services, Substance Abuse and Mental Health Services Administration (SAMHSA), implemented a similar referral requirement in its 2003 final rule, Charitable Choice Regulations Applicable to States Receiving Substance Abuse Prevention and Treatment Block Grants, Projects for Assistance in Transition From Homelessness Formula Grants, and to Public and Private Providers Receiving Discretionary Grant Funding from SAMHSA for the Provision of Substance Abuse Services Providing for Equal Treatment of SAMHSA Program Participants (SAMHSA Program Rule), 68 FR 56430. Since SAMHSA implemented the referral requirement, the SAMHSA program office has received no reports of requests for an alternate provider. Because faith-based organizations are required to provide a written notification of the beneficiary’s rights under this proposed rule, requests for referrals may be more likely. However, given SAMHSA’s experience, USDA estimates that 0.10 percent of beneficiaries and potential beneficiaries would request referrals to alternate providers. USDA will monitor its programs to assess whether this estimate is accurate. 47249 USDA is not estimating the burden of maintaining the records needed to demonstrate compliance with the requirements imposed on faith-based organizations. USDA has recordkeeping requirements included in information collection instruments for USDA programs. Those collection instruments cover burdens imposed by program and administrative requirements that exist under current, OMB-approved, information collection instruments; each of those collections has an OMBassigned information collection control number. The recordkeeping burden that this proposed rule would add to those program-specific information collection instruments is so small that, under most programs, it would not measurably increase the burden that already exists under current program and administrative requirements. If, due to the unique nature of a particular program, the recordkeeping burden associated with these proposed regulations is large enough to be measurable, that burden will be calculated under the recordkeeping and reporting requirements of the affected program and identified in information collection requests that are submitted to OMB for PRA approval. Therefore, we have not included any estimate of the recordkeeping burden in this PRA analysis. The burden of the information collections in this proposed rule is estimated as follows: REPORTING AND RECORDKEEPING BURDEN [Faith based organizations reporting and recordkeeping burden] Number of respondents Program 24 Section 5.109(g) ..... mstockstill on DSK4VPTVN1PROD with PROPOSALS4 Reg. section NIFA—Community Foods Projects Competitive Grants Program: Written Notice of Rights handout ............ Referral ................................................... FNS—The Emergency Food Assistance Program—Pantries (TEFAP): 13 Referral ................................................... FNS—The Emergency Food Assistance Program—Kitchens (TEFAP): Referral ................................................... RD—Community Facilities: Written Notice of Rights handout ............ Referral ................................................... RD—Business Programs: Written Notice of Rights handout ............ Referral ................................................... RD—Housing: Written Notice of Rights handout ............ Referral ................................................... Totals .............................................................. VerDate Sep<11>2014 20:40 Aug 05, 2015 Jkt 235001 PO 00000 Frm 00007 Fmt 4701 Number of responses per beneficiary Estimated average response time Estimated annual burden hours 1,000 1 1 1 .03 (2 min.) ........... 2.00 hrs. ................ 30 2 3,042 1 2 ............................ 6,084 368 1 2 ............................ 736 13,875 14 1 1 0.03 ....................... 2 ............................ 416 28 2,319 2 1 1 0.03 ....................... 2 ............................ 70 4 1,577 2 1 1 0.03 ....................... 2 ............................ 47 4 22,181 ........................ ............................... 7,421 Sfmt 4702 E:\FR\FM\06AUP4.SGM 06AUP4 mstockstill on DSK4VPTVN1PROD with PROPOSALS4 47250 Federal Register / Vol. 80, No. 151 / Thursday, August 6, 2015 / Proposed Rules In accordance with 5 CFR 1320.8(d)(1), USDA is soliciting comments from members of the public and affected agencies concerning this collection of information to: (1) Evaluate whether the proposed collection of information is necessary for the proper performance of the functions of the agency, including whether the information will have practical utility; (2) Evaluate the accuracy of the agency’s estimate of the burden of the proposed collection of information, including the validity of the methodology and assumptions used; (3) Enhance the quality, utility, and clarity of the information to be collected; and (4) Minimize the burden of the collection of information on those who are to respond, including through the use of appropriate automated collection techniques or other forms of information technology, for example, permitting electronic submission of responses. Interested persons are invited to submit comments regarding the information collection requirements in this rule. Comments must refer to the proposed rule by name and docket number (RIN 0503–AA55) and must be sent to: USDA Desk Officer, Office of Information and Regulatory Affairs, Office of Management and Budget, New Executive Office Building, Washington, DC 20503, Email: oira_submission@ omb.eop.gov, Fax: (202) 395–6947 and Norah Deluhery, Director, Center for Faith-Based and Neighborhood Partnerships, U.S. Department of Agriculture, 1400 Independence Ave. SW., Washington, DC 20250. Interested persons may submit comments regarding the information collection requirements electronically through the Federal eRulemaking Portal at http://www.regulations.gov. USDA strongly encourages commenters to submit comments electronically. Electronic submission of comments allows the commenter maximum time to prepare and submit a comment, ensures timely receipt by USDA, and enables USDA to make them immediately available to the public. Comments submitted electronically through the http://www.regulations.gov Web site can be viewed by other commenters and interested members of the public. Commenters should follow the instructions provided on that site to submit comments electronically. 13 Analysis for Written Notice of Rights handout not provided for TEFAP, as notification will be posted in a prominent place in lieu of a handout. VerDate Sep<11>2014 20:40 Aug 05, 2015 Jkt 235001 I. E-Government Act Compliance USDA is committed to complying with the E-Government Act, to promote the use of the Internet and other information technologies to provide increased opportunities for citizen access to Government information and services, and for other purposes. List of Subjects in 7 CFR Part 16 Administrative practice and procedure. Grant programs. Accordingly, 7 CFR Subtitle A is amended as set forth below: PART 16—EQUAL OPPORTUNITY FOR RELIGIOUS ORGANIZATIONS 1. The authority citation for Part 16 is revised to read as follows: ■ Authority: 5 U.S.C. 301; E.O. 13279, 67 FR 77141; E.O. 13280, 67 FR 77145; E.O. 13559, 75 FR 71319. 2. Revise paragraph (b) of § 16.1 to read as follows: ■ § 16.1 Purpose and applicability. * * * * * (b) Except as otherwise specifically provided in this part, the policy outlined in this part applies to all recipients and subrecipients of USDA assistance to which 2 CFR part 400 applies, and to recipients and subrecipients of Commodity Credit Corporation assistance that is administered by agencies of USDA. §§ 16.2 through 16.5 [Redesignated as §§ 16.3 through 16.6] 3. Redesignate §§ 16.2 through 16.5 as §§ 16.3 through 16.6, respectively. ■ 4. Add a new § 16.2 to read as follows: ■ § 16.2 Definitions. As used in this part: (a) USDA direct assistance is Federal financial assistance provided by USDA and means that the Federal 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 grant or cooperative agreement). In general, USDA assistance shall be treated as direct, unless it meets the definition of ‘‘USDA indirect assistance.’’ (b)(1) USDA indirect assistance is Federal financial assistance provided indirectly by USDA and 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’’ PO 00000 Frm 00008 Fmt 4701 Sfmt 4702 within the meaning of the Establishment Clause of the First Amendment to the U.S. Constitution 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; (ii) The organization receives the assistance as a result of a decision of the beneficiary, not a decision of the government; and (iii) The beneficiary has at least one adequate secular option for the use of the voucher, certificate, or other similar means of government-funded payment. (2) 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,’’ as those terms are used in Executive Order 13559. These recipients of sub-awards are considered recipients of USDA direct assistance. (c) 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 with the provisions of Executive Order 13559 and any implementing rules or guidance by the recipient of a contract, grant, or agreement. If the intermediary is a non-governmental organization, it retains all other rights of a nongovernmental organization under the program’s statutory and regulatory provisions. ■ 4. Revise paragraph (a) and the introductory text of paragraph (b) of newly redesignated § 16.3 to read as follows: § 16.3 Rights of religious organizations. (a) A religious organization is eligible, on the same basis as any other eligible private organization, to access and participate in USDA assistance programs. Neither the Federal E:\FR\FM\06AUP4.SGM 06AUP4 Federal Register / Vol. 80, No. 151 / Thursday, August 6, 2015 / Proposed Rules Government nor a State or local government receiving USDA assistance shall, in the selection of service providers, discriminate for or against a religious organization on the basis of the organization’s religious character or affiliation. Additionally, decisions about awards of USDA direct assistance or USDA indirect 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. (b) A religious organization that participates in USDA assistance programs will retain its independence and may continue to carry out its mission, including the definition, practice, and expression of its religious beliefs, provided that it does not use USDA direct assistance to support any explicitly religious activities, including activities that involve overt religious content such as worship, religious instruction, or proselytization. Among other things, a religious organization may: * * * * * ■ 5. Amend newly redesignated § 16.4 as follows: ■ a. Revise paragraphs (b) and (d); and ■ b. Add new paragraphs (e), (f), and (g). The revisions and additions read as follows: § 16.4 Responsibilities of participating organizations. mstockstill on DSK4VPTVN1PROD with PROPOSALS4 * * * * * (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 supported with 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. These restrictions on explicitly religious activities do not apply where USDA funds or benefits are provided to religious organizations as a result of a genuine and independent private choice of a beneficiary or through other indirect funding mechanisms, provided the religious organizations otherwise satisfy the requirements of the program. * * * * * (d)(1) USDA direct assistance may be used for the acquisition, construction, or rehabilitation of structures only to the VerDate Sep<11>2014 20:40 Aug 05, 2015 Jkt 235001 extent that those structures are used for conducting USDA programs and activities and only 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 explicitly religious activities, USDA direct 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 assistance funds for equipment, supplies, labor, indirect costs, and the like shall be prorated between the USDA program or activity and any use for other 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. (e) USDA direct assistance under any USDA program may not be used for explicitly religious activities, speech, and materials generated or controlled by the administrators, instructors, or officials of the organization receiving USDA direct assistance. (f) Beneficiary protections: Written notice. (1) Faith-based organizations that receive USDA direct assistance under any USDA program must give written notice in a manner prescribed by USDA to all beneficiaries and prospective beneficiaries of their right to be referred to an alternate provider when available. The written notice must be given in a manner prescribed by USDA, and state that: (i) The organization may not discriminate against beneficiaries on the basis of religion or religious belief; (ii) The organization may not require beneficiaries to attend or participate in any explicitly religious activities that are offered by the organization, and any PO 00000 Frm 00009 Fmt 4701 Sfmt 4702 47251 participation by beneficiaries in such activities must be purely voluntary; (iii) The organization must separate in time or location any privately funded explicitly religious activities from activities supported by direct Federal financial assistance; (iv) If a beneficiary objects to the religious character of the organization, the organization will undertake reasonable efforts to identify and refer the beneficiary to an alternate provider; the organization may not be able to guarantee, however, that in every instance, an alternate provider will be available; and (v) Beneficiaries may report violations of these protections to USDA (or, the intermediary, if applicable). (2) This written notice must be given to beneficiaries prior to the time they enroll in the program or receive services from such programs. When the nature of the service provided or exigent circumstances make it impracticable to provide such written notice in advance of the actual service, service providers must advise beneficiaries of their protections at the earliest available opportunity. (g) Beneficiary protections: Referral requirements. If a beneficiary or prospective beneficiary of a social service program supported by USDA objects to the religious character of an organization that provides services under the program, that organization must promptly undertake reasonable efforts to identify and refer the beneficiary to an alternate provider, within reasonable geographic proximity to the provider, if available, to which the prospective beneficiary has no objection. In making the referral, the organization shall comply with all applicable privacy laws and regulations. (1) A referral may be made to another faith-based organization, if the beneficiary has no objection to that provider. But if the beneficiary requests a secular provider, and a secular provider is available, then a referral must be made to that provider. (2) Except for services provided by telephone, Internet, or similar means, the referral must be to an alternate provider that is in reasonable geographic proximity to the organization making the referral and that offers services that are similar in substance and quality to those offered by the organization, if one is available. The alternate provider also should have the capacity to accept additional clients, if one with capacity to accept additional clients is available. (3) When the organization makes a referral to an alternate provider, or when the organization determines that it E:\FR\FM\06AUP4.SGM 06AUP4 47252 Federal Register / Vol. 80, No. 151 / Thursday, August 6, 2015 / Proposed Rules is unable to identify an alternate provider, the organization shall notify the awarding entity. If the organization is unable to identify an alternate provider, the awarding entity shall determine whether there is any other suitable alternate provider to which the beneficiary may be referred. An intermediary that receives a request for assistance in identifying an alternate provider may request assistance from USDA or a State or local government receiving USDA direct assistance. (4) In some cases, USDA may require that the awarding entity provide the organization with information regarding alternate providers. Such information regarding alternative providers should include providers (including secular organizations) within a reasonable geographic proximity that offer services that are similar in substance and quality and that would reasonably be expected to have the capacity to accept additional clients, provided any such organizations exist. An organization which relies on such information provided by the awarding entity shall be considered to have undertaken reasonable efforts to identify an alternate provider under this subpart. ■ 6. Revise newly redesignated § 16.5 to read as follows: § 16.5 Effect on State and local funds. mstockstill on DSK4VPTVN1PROD with PROPOSALS4 If a State or local government voluntarily contributes its own funds to supplement activities carried out under programs governed by this part, the State or local government has the option to separate out the USDA direct assistance funds or comingle them. If the funds are comingled, the provisions of this part shall apply to all of the comingled funds in the same manner, VerDate Sep<11>2014 20:40 Aug 05, 2015 Jkt 235001 and to the same extent, as the provisions apply to the USDA direct assistance. ■ 7. Add Appendix A to part 16 to read as follows: Appendix A to Part 16—Written Notice of Beneficiary Rights Name of Organization: Name of Program: Contact Information for Program Staff (name, phone number, and email address, if appropriate): Because this program is supported in whole or in part by financial assistance from the Federal Government, we are required to let you know that— • We may not discriminate against you on the basis of religion or religious belief; • We may not require you to attend or participate in any explicitly religious activities that are offered by us, and any participation by you in these activities must be purely voluntary; • We must separate in time or location any privately funded explicitly religious activities from activities supported with USDA direct assistance; • If you object to the religious character of our organization, we must make reasonable efforts to identify and refer you to an alternate provider. We cannot guarantee, however, that in every instance, an alternate provider will be available; and • You may report violations of these protections to l. We must provide you with this written notice before you enroll in our program or receive services from the program, as required by 7 CFR part 16. BENEFICARY REFERRAL REQUEST If you object to receiving services from us based on the religious character of our organization, please complete this form and return it to the program contact identified above. Your use of this form is voluntary. If you object to the religious character of our organization, we must make reasonable efforts to identify and refer you to an PO 00000 Frm 00010 Fmt 4701 Sfmt 9990 alternate provider to which you have no objection. We cannot guarantee, however, that in every instance, an alternate provider will be available. With your consent, we will follow up with you or the organization to which you are referred to determine whether you have contacted that organization. ( ) Please check if you want to be referred to another service provider. Please provide the following information if you want us to follow up with you: Your Name: Best way to reach me (phone/address/ email): Please provide the following information if you want us to follow up with the service provider only. Your Name: You are permitted to withhold your name, though if you choose to do so, we will be unable to follow up with you or the service provider about your referral. ( ) Please check if you do not want follow up. lllllllllllllllllllll FOR STAFF USE ONLY 1. Date of Objection: ll/ll/ll 2. Referral (check one): ( ) Individual was referred to (name of alternate provider and contact information): ( ) Individual left without a referral ( ) No alternate service provider is available—summarize below what efforts you made to identify an alternate provider (including reaching out to USDA or the intermediary, if applicable): 3. Follow-up date: ll/ll/ll ( ) Individual contacted alternate provider ( ) Individual did not contact alternate provider 4. Staff name and initials: Dated: July 16, 2015. Thomas J. Vilsack, Secretary. [FR Doc. 2015–18262 Filed 8–5–15; 8:45 am] BILLING CODE 3410–90–P E:\FR\FM\06AUP4.SGM 06AUP4

Agencies

[Federal Register Volume 80, Number 151 (Thursday, August 6, 2015)]
[Proposed Rules]
[Pages 47243-47252]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2015-18262]



[[Page 47243]]

Vol. 80

Thursday,

No. 151

August 6, 2015

Part VI





Department of Agriculture





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Office of the Secretary





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7 CFR Part 16





Equal Opportunity for Religious Organizations in USDA Programs: 
Implementation of E.O.13559; Proposed Rule

Federal Register / Vol. 80 , No. 151 / Thursday, August 6, 2015 / 
Proposed Rules

[[Page 47244]]


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DEPARTMENT OF AGRICULTURE

Office of the Secretary

7 CFR Part 16

RIN 0503-AA55


Equal Opportunity for Religious Organizations in USDA Programs: 
Implementation of E.O. 13559

AGENCY: Office of the Secretary, USDA.

ACTION: Proposed rule.

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SUMMARY: This rule proposes to revise USDA's regulation that covers 
equal opportunity for participation of faith-based (religious) 
organizations in USDA programs. These revisions are being undertaken to 
implement Executive Order 13559, Fundamental Principles and 
Policymaking Criteria for Partnerships with Faith-Based and Other 
Neighborhood Organizations. Executive Order 13559 amended Executive 
Order 13279, Equal Protection of the Laws for Faith-Based and Community 
Organizations, which provides the legal basis for USDA's current equal 
participation regulations to protect religious liberty rights of 
beneficiaries of USDA funded programs. This rule adopts changes to 
Executive Order 13279 made by Executive Order 13559, including changes 
to specific terminology, additional beneficiary protections, and 
clarifications on the responsibilities of intermediaries. In addition 
to proposing regulatory amendments to implement Executive Order 13559, 
USDA is also publishing for public comment a Paperwork Reduction Act 
information collection notice of beneficiary protections for use by 
religious organizations.

DATES: Comment Due Date. October 5, 2015.

ADDRESSES: Interested persons are invited to submit comments regarding 
this proposed rule to as indicated below. Instructions for submitting 
public comments on the information collection notice are set forth in 
Section III.h. There are two methods for submitting public comments on 
this proposed rule. All submissions must refer to the above docket 
number and title.
    1. Submission of Comments by Mail. Comments may be submitted by 
mail to Norah Deluhery, Director, Center for Faith-Based and 
Neighborhood Partnerships, U.S. Department of Agriculture, 1400 
Independence Avenue SW., Washington, DC 20250.
    2. Electronic Submission of Comments. Interested persons may submit 
comments electronically through the Federal eRulemaking Portal at 
www.regulations.gov. USDA strongly encourages commenters to submit 
comments electronically. Electronic submission of comments allows the 
commenter maximum time to prepare and submit a comment, ensures timely 
receipt by USDA, and enables USDA to make them immediately available to 
the public. Comments submitted electronically through the 
www.regulations.gov Web site can be viewed by other commenters and 
interested members of the public. Commenters should follow the 
instructions provided on that site to submit comments electronically.

    Note: To receive consideration as public comments, comments must 
be submitted through one of the two methods specified above. Again, 
all submissions must refer to RIN 0503-AA55 and the title of this 
rule.

    No Facsimile Comments. Facsimile (FAX) comments will not be 
accepted.

FOR FURTHER INFORMATION CONTACT: Norah Deluhery, Director, Center for 
Faith-Based and Neighborhood Partnerships, U.S. Department of 
Agriculture, 1400 Independence Avenue SW., Washington, DC 20250; 
telephone number (202) 720-2032 (this is not a toll-free number). 
Persons with disabilities or who require alternative means of 
communication (Braille, large print, audio tape, etc.) should contact 
the USDA Target Center at (202) 720-2600 (voice and TDD).

I. Supplementary Information

Background

    On December 12, 2002, President George W. Bush signed Executive 
Order 13279, ``Equal Protection of the Laws for Faith-Based and 
Community Organizations,'' which was published on December 16, 2002, at 
67 FR 77141. Executive Order 13279 set forth the principles and 
policymaking criteria to guide Federal agencies in formulating and 
developing policies with implications for faith-based organizations and 
other community organizations, to ensure equal protection of the laws 
for faith-based and other 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 relating to 
Federal financial assistance for social services programs and, where 
appropriate, to implement new policies that were consistent with, and 
necessary to, the furthering of the fundamental principles and 
policymaking criteria that have implications for faith-based and 
community organizations.
    Also on December 12, 2002, President Bush signed Executive Order 
13280 (67 FR 77145), ``Responsibilities of the Department of 
Agriculture and the Agency for International Development, with Respect 
to Faith-Based and Community Initiatives,'' which created a Center for 
Faith-Based and Community Initiatives at USDA and charged USDA to 
identify and eliminate regulatory, contracting, and other programmatic 
barriers to full participation of faith-based and community 
organizations in its programs.
    USDA implemented Executive Order 13279 through the final rule, 
Equal Opportunity for Religious Organizations, published on July 9, 
2004, at 69 FR 41375, and added USDA's regulations in 7 CFR part 16.
    The regulations established by that rule provide the following: (1) 
Faith-based (religious) organizations are eligible on the same basis as 
any other eligible organization to participate in USDA programs and 
activities; (2) religious organizations that participate in USDA 
programs or activities may retain their independence; (3) a religious 
organization that participates in a USDA program does not forfeit its 
exemption from the prohibition on employment discrimination on the 
basis of religion, as provided in Title VII of the Civil Rights Act of 
1964 (though some individual USDA programs may have independent 
statutory nondiscrimination requirements); (4) organizations may not 
discriminate against beneficiaries or prospective beneficiaries on the 
basis of religion or religious beliefs; (5) organizations may not 
engage in inherently religious activities as part of programs or 
services directly funded under a USDA program or activity.
    On February 5, 2009, President Barack Obama signed Executive Order 
13498, entitled ``Amendments to Executive Order 13199 and Establishment 
of the President's Advisory Council for Faith-Based and Neighborhood 
Partnerships,'' which was published on February 9, 2009, at 74 FR 6533. 
Executive Order 13498 established the President's Advisory Council for 
Faith-Based and Neighborhood Partnerships (Advisory Council) for the 
purpose of bringing together experts to, among other things, make 
recommendations to the President for changes in policies, programs, and 
practices that affect the delivery of services by faith-based and other 
neighborhood organizations.

[[Page 47245]]

    In March of 2010, the Advisory Council issued its recommendations 
in a report entitled ``A New Era of Partnerships: Report of 
Recommendations to the President.'' \1\ The Advisory Council Report 
included recommendations to amend Executive Order 13279 in order to 
clarify the legal foundation of partnerships and offered a new set of 
fundamental principles to guide agency decision-making in administering 
Federal financial assistance and support to faith-based and 
neighborhood organizations.
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    \1\ http://www.whitehouse.gov/sites/default/files/microsites/ofbnp-council-final-report.pdf.
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    On November 17, 2010, President Obama signed Executive Order 13559, 
entitled ``Fundamental Principles and Policymaking Criteria for 
Partnerships with Faith-Based and Other Neighborhood Organizations,'' 
which was published on November 22, 2010, at 75 FR 71319.\2\ Executive 
Order 13559 incorporated many of the Advisory Council's recommendations 
and amended Executive Order 13279 to include additional Fundamental 
Principles and Policymaking Criteria for inclusion in guidance and 
regulations.\3\ The principles include, as follows:
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    \2\ http://www.gpo.gov/fdsys/pkg/FR-2010-11-22/pdf/2010-29579.pdf.
    \3\ Executive Order 13279, Section 2 paragraphs (e)-(j).
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     The Federal Government has an obligation to monitor and 
enforce all standards regarding the relationship between religion and 
government in ways that avoid excessive entanglement between religious 
bodies and governmental entities;
     Organizations engaging in explicitly religious activity 
must separate these activities in time or location from programs 
supported with direct Federal financial assistance (including prime 
awards and sub-awards), participation in any explicit religious 
activity cannot be subsidized with direct Federal financial assistance 
(including prime awards and sub-awards), and participation in such 
activities must be voluntary for the beneficiaries of the social 
service program supported with such Federal financial assistance;
     Religious providers are welcome to compete for Federal 
Government social service funding and maintain a religious identity as 
described in the order;
     Agencies that administer or award Federal financial 
assistance for social service programs must implement protections for 
the beneficiaries or prospective beneficiaries of those programs (these 
protections include providing referrals to alternate providers if the 
beneficiary objects to the religious character of the organization 
providing services, and ensuring that written notice of these and other 
protections is provided to beneficiaries before they enroll in or 
receive services from the program);
     Agencies that provide Federal financial assistance for 
social service programs must post online regulations, guidance 
documents, and policies that have implications for faith-based and 
neighborhood organizations and must post online a list of entities 
receiving such assistance; and
     Agency 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 the religious affiliation, or lack of 
affiliation, of the recipient organization.
    In addition, Executive Order 13559 created the Interagency Working 
Group on Faith-Based and Other Neighborhood Partnerships (Working 
Group) for the purpose of reviewing and evaluating existing 
regulations, guidance documents, and policies.
    The Executive Order also stated that, following receipt of the 
Working Group's report, the Office of Management and Budget (OMB), in 
coordination with the U.S. Department of Justice, must issue guidance 
to agencies on the implementation of Executive Order 13559. The Working 
Group issued its report in April of 2012.\4\ In August of 2013, OMB 
issued guidance instructing specified agency heads to do the following: 
(1) Adopt regulations and guidance that will fulfill the requirements 
of Executive Order 13559 and (2) amend regulations and guidance to 
ensure that they are consistent with this executive order.\5\
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    \4\ Recommendations of the Interagency Working Group on Faith-
Based Organizations and Other Neighborhood Partnerships, April 2012, 
at http://www.whitehouse.gov/sites/default/files/uploads/finalfaithbasedworkinggroupreport.pdf.
    \5\ M-13-19, ``Implementation of Executive Order 13559, 
`Fundamental Principles and Policymaking Criteria for Partnerships 
with Faith-based and Other Neighborhood Organizations' '', August 2, 
2013, at http://www.whitehouse.gov/sites/default/files/omb/memoranda/2013/m-13-19.pdf.
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II. Discussion of Proposed Rule

A. Overview of Proposed Regulations

    This proposed rule updates 7 CFR part 16 to reflect the new 
Fundamental Principles and Policymaking Criteria in Executive Order 
13559. Some of the principles do not require regulations and may be 
included in guidance issued by the Department.
    USDA implements Executive Order 13559 in 7 CFR part 16 by: (1) 
Adding definitions for USDA direct assistance, USDA indirect 
assistance, and intermediary; (2) including a new requirement that 
decisions must be free from political interference or even the 
appearance of such interference; (3) clarifying the separation of 
explicitly religious activities from activities funded with USDA direct 
assistance and defining explicitly religious activities; (4) clarifying 
the responsibilities of intermediary organizations; (5) adding new 
beneficiary protections, and (6) amending existing language in 7 CFR 
part 16 to include the Executive Order 13559 changes. The Department 
may issue guidance on the applicability of the executive order and the 
rule to particular programs.

B. Specific Proposed Amendments

1. New Definitions
    This proposed rule adds definitions for ``USDA direct assistance,'' 
``USDA indirect assistance,'' and ``intermediary'' at 7 CFR 16.2.
    Executive Order 13559 noted that new regulations should distinguish 
between ``direct'' and ``indirect'' Federal financial assistance 
because the limitation on explicitly religious activities applies to 
programs that are supported with ``direct'' Federal financial 
assistance but does not apply to programs supported with ``indirect'' 
Federal financial assistance. To clarify this distinction, the proposed 
rule provides definitions of these terms.
    Programs are supported with USDA direct assistance when either the 
Federal Government or an intermediary, as identified in this proposed 
rule, selects a service provider and either purchases services from 
that provider (e.g., through a contract), or awards funds to that 
provider to carry out an activity (e.g., through a contract, grant, 
sub-grant, or cooperative agreement). Under these circumstances, there 
are no intervening steps in which the beneficiary's choice determines 
the provider's identity.
    Indirect Federal financial assistance is distinguishable because it 
places the choice of service provider in the hands of a beneficiary 
before the Federal Government pays for the cost of that service through 
a voucher, certificate, or other similar means. For example, the 
government could choose to allow the beneficiary to secure the needed 
service on his or her own. Alternatively, a Federal governmental 
agency, operating under a neutral program of aid, could present each 
beneficiary or prospective beneficiary with a list of all qualified 
providers from which the beneficiary could obtain services using a 
government-provided certificate. Either

[[Page 47246]]

way, the Federal Government empowers the beneficiaries to choose for 
themselves whether to receive the needed services, including those that 
contain explicitly religious activities, through a faith-based or other 
neighborhood organization. The Federal Government could then pay for 
the beneficiary's choice of provider by giving the beneficiary a 
voucher or similar document. Alternatively, the government could choose 
to pay the provider directly after asking the beneficiary to indicate 
the beneficiary's choice.\6\
---------------------------------------------------------------------------

    \6\ See Freedom From Religion Found. v. McCallum, 324 F.3d 880, 
882 (7th Cir. 2003).
---------------------------------------------------------------------------

    The Supreme Court has held that if a program meets certain 
criteria, the Federal Government may fund the program if, among other 
things, the program places the benefit in the hands of individuals, 
who, in turn, have the freedom to choose the provider from which they 
receive their benefit and ``spend'' the Federal Government funds, 
whether that provider is public or private, non-religious or 
religious.\7\ In these instances, the Federal Government does not 
encourage or promote any explicitly religious programs that may be 
among the options available to beneficiaries. Notably, the voucher 
scheme at issue in the Zelman decision, which was described by the 
Court as one of ``true private choice,'' \8\ was also neutral toward 
religion and offered beneficiaries adequate secular options. This type 
of Federal financial assistance is considered ``indirect'' within the 
meaning of the Establishment Clause of the First Amendment of the U.S. 
Constitution. Accordingly, these criteria also are included in the text 
of the proposed definition of ``USDA indirect assistance.''
---------------------------------------------------------------------------

    \7\ See Zelman v. Simmons-Harris, 536 U.S. 639, 652-53 (2002).
    \8\ Id. at 653.
---------------------------------------------------------------------------

    The Department also proposes regulatory language that will clarify 
the responsibilities of intermediaries. An intermediary is 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 Federal financial assistance and 
distributes that assistance to other organizations that, in turn, 
provide government-funded social services. Each intermediary must abide 
by all statutory and regulatory requirements by, for example, providing 
any services supported with direct Federal financial assistance in a 
religiously neutral manner that does not include explicitly religious 
activities. The intermediary also has the same duties as the government 
to comply with these rules by, for example, selecting any providers to 
receive Federal financial assistance in a manner that does not favor or 
disfavor organizations on the basis of religion or religious belief. 
While intermediaries may be used to distribute Federal financial 
assistance to other organizations in some programs, intermediaries 
remain accountable for the Federal financial assistance they disburse. 
Accordingly, intermediaries must ensure that any providers to which 
they disburse Federal financial assistance also comply with these 
rules. If the intermediary is a non-governmental organization, it 
retains all other rights of a non-governmental organization under the 
statutory and regulatory provisions governing the program.
    A State's use of intermediaries does not relieve the State of its 
traditional responsibility to effectively monitor the actions of such 
organizations. States are obligated to manage the day-to-day operations 
of grant- and sub-grant- supported activities to ensure compliance with 
applicable Federal requirements and performance goals. Moreover, a 
State's use of intermediaries does not relieve the State of its 
responsibility to ensure that providers are selected, and deliver 
services, in a manner consistent with the First Amendment's 
Establishment Clause.
2. Decisions Must Be Free From Political Interference
    This proposed rule adds to the existing paragraph (a) of 7 CFR 
16.2, redesignated as Sec.  16.3 under the proposed rule, a sentence 
clarifying that decisions about awards of Federal financial assistance 
must be free from political interference or even the appearance of such 
interference. To comply with this requirement, awarding entities, 
including intermediaries, should instruct participants in the awarding 
process to refrain from taking religious affiliations or non-religious 
affiliations into account in this process; i.e., an organization should 
not receive favorable or unfavorable marks merely because it is 
affiliated or unaffiliated with a religious body, or related or 
unrelated to a specific religion. Additionally, when selecting peer 
reviewers, the awarding entity should never ask about religious 
affiliation or take such matters into account, but the awarding entity 
should encourage religious, political, and professional diversity among 
peer reviewers by advertising for these positions in a wide variety of 
venues.
3. Separation of Explicitly Religious Activities From Activities Funded 
With Direct Federal Financial Assistance and Definition of ``Explicitly 
Religious Activities''
    This proposed rule would amend paragraph (b) in 7 CFR 16.2, 
redesignated as Sec.  16.3, and paragraphs (b) and (d)(1) in Sec.  
16.3, redesignated as Sec.  16.4, to clarify the requirement that 
activities supported by direct Federal financial assistance must be 
separate from explicitly religious activities, define ``explicitly 
religious activities,'' and replace the term ``inherently religious 
activities'' with the term ``explicitly religious activities.''
    Executive Order 13559 makes clear that all organizations that 
receive Federal financial assistance are prohibited from discriminating 
against beneficiaries or potential beneficiaries of Federal programs on 
the basis of religion, a religious belief, refusal to hold a religious 
belief, or a refusal to attend or participate in a religious practice. 
The Executive Order also states that organizations offering explicitly 
religious activities (including activities that involve overt religious 
content such as worship, religious instruction, or proselytization) 
must not use direct Federal financial assistance to subsidize or 
support those activities, and that any explicitly religious activities 
must be offered outside of programs that are supported with direct 
Federal financial assistance (including through prime awards or sub-
awards). In other words, to the extent that an organization provides 
explicitly religious activities, those activities must be offered 
separately in time or location from programs or services supported with 
direct Federal financial assistance.
    USDA's existing regulations at 7 CFR part 16 and Executive Order 
13279, prohibit nongovernmental organizations from using direct Federal 
financial assistance (e.g., government grants, contracts, sub-grants, 
and subcontracts) for ``inherently religious activities, such as 
worship, religious instruction, and proselytization.'' The term 
``inherently religious,'' however, has proven confusing. In 2006, for 
example, the Government Accountability Office (GAO) found that while 
all 26 of the religious social service providers GAO interviewed 
indicated they understood the prohibition on using direct Federal 
financial assistance for ``inherently religious activities,'' four of 
the providers described acting in ways that appeared to violate that 
rule.\9\
---------------------------------------------------------------------------

    \9\ GAO, Faith-Based and Community Initiative: Improvements in 
Monitoring Grantees and Measuring Performance Could Enhance 
Accountability, GAO-06-616, at 34-35 (June 2006) (available at 
http://www.gao.gov/new.items/d06616.pdf).

---------------------------------------------------------------------------

[[Page 47247]]

    Further, while the Supreme Court has sometimes used the term 
``inherently religious,'' the Court has not used this term to indicate 
the boundary of what the Federal Government may subsidize with direct 
Federal financial assistance. If the term is interpreted narrowly, it 
could permit actions that the Constitution prohibits. On the other 
hand, one could also argue that the term ``inherently religious'' is 
too broad rather than too narrow. For example, some might consider 
their provision of a hot meal to a needy person to be an ``inherently 
religious'' act when it is undertaken from a sense of religious 
motivation or obligation, even though it has no overt religious 
content.
    The Court has determined that the Government cannot subsidize ``a 
specifically religious activity in an otherwise substantially secular 
setting.'' \10\ The Court has also said a direct aid program 
impermissibly advances religion when the aid results in governmental 
indoctrination of religion.\11\ This terminology is fairly interpreted 
to prohibit the Federal Government from directly subsidizing any 
``explicitly religious activity,'' including activities that involve 
overt religious content. Thus, direct Federal financial assistance 
should not be used to pay for activities such as religious instruction, 
devotional exercises, worship, proselytizing or evangelism; production 
or dissemination of devotional guides or other religious materials; or 
counseling in which counselors introduce religious content. Similarly, 
direct Federal financial assistance may not be used to pay for 
equipment or supplies to the extent they are allocated to such 
activities. Activities that are secular in content, such as serving 
meals to the needy or using a non-religious text to teach someone to 
read, are not considered ``explicitly religious activities'' merely 
because the provider is religiously motivated to provide those 
services. The study or acknowledgment of religion as a historical or 
cultural reality also would not be considered an explicitly religious 
activity.
---------------------------------------------------------------------------

    \10\ Hunt v. McNair, 413 U.S. 734, 743 (1973).
    \11\ See Mitchell v. Helms, 530 U.S. 793, 808 (2000) (Thomas, 
J., joined by Rehnquist, C.J., Scalia, and Kennedy, J.J., 
plurality); id. at 845 (O'Connor, J., joined by Breyer, J., 
concurring in the judgment); Agostini v. Felton, 521 U.S. 203, 223 
(1997).
---------------------------------------------------------------------------

    Notwithstanding the general prohibition on the use of direct 
Federal financial assistance to support explicitly religious 
activities, there are times when religious activities may be Federally 
financed under the Establishment Clause and not subject to the direct 
Federal financial assistance restrictions--for instance, in situations 
where Federal financial assistance is provided to chaplains to work 
with inmates in prisons, detention facilities, or community correction 
centers through social service programs.\12\ Likewise, it is important 
to emphasize that the restrictions on explicit religious content apply 
to content generated by the administrators of the program receiving 
direct Federal financial assistance, not to spontaneous comments made 
by individual beneficiaries about their personal lives in the context 
of these programs. For example, if a person administering a Federally 
funded job skills program asks beneficiaries to describe how they gain 
the motivation necessary for their job searches and some beneficiaries 
refer to their faith or membership in a faith community, these kinds of 
comments do not violate the restrictions and should not be censored. In 
this context, it is clear that the administrator of the Federal 
Government-funded program did not orchestrate or encourage such 
comments.
---------------------------------------------------------------------------

    \12\ Where there is extensive government control over the 
environment of the Federally-financed social service program, 
program officials may sometimes need to take affirmative steps to 
provide an opportunity for beneficiaries of the social service 
program to exercise their religion. See Cruz v. Beto, 405 U.S. 319, 
322 n.2 (1972) (per curiam) (``reasonable opportunities must be 
afforded to all prisoners to exercise the religious freedom 
guaranteed by the First and Fourteenth Amendment without fear of 
penalty''); Katcoff v. Marsh, 755 F.2d 223, 234 (2d Cir. 1985) 
(finding it ``readily apparent'' that the Government is obligated by 
the First Amendment to ``to make religion available to soldiers who 
have been moved by the Army to areas of the world where religion of 
their own denominations is not available to them''). Without such 
efforts, religious freedom might not exist for these beneficiaries. 
Accordingly, services such as chaplaincy services would not be 
considered explicitly religious activities that are subject to 
direct financial aid restrictions.
---------------------------------------------------------------------------

    USDA, therefore, proposes to replace the term ``inherently 
religious activities'' with the term ``explicitly religious 
activities'' and define the latter term as ``including activities that 
involve overt religious content such as worship, religious instruction, 
or proselytization.'' These changes in language will provide greater 
clarity and more closely match constitutional standards as they have 
been developed in case law.
    These restrictions would not diminish existing regulatory 
protections for the religious identity of faith-based providers. The 
proposed rule would not affect, for example, organizations' ability to 
use religious terms in their organizational names, select board members 
on a religious basis, include religious references in mission 
statements and other organizational documents, and post religious art, 
messages, scriptures, and symbols in buildings where Federal financial 
assistance is delivered.
4. New Beneficiary Protections
    This rule proposes to add new paragraphs (f) and (g) to Sec.  16.3, 
redesignated as Sec.  16.4 under this proposed rule, implementing a 
variety of valuable protections for the religious liberty rights of 
social service beneficiaries. These protections are aimed at ensuring 
that Federal financial assistance is not used to coerce or pressure 
beneficiaries along religious lines, and to make beneficiaries aware of 
their rights, through appropriate notice, when potentially obtaining 
services from providers with a religious affiliation.
    Executive Order 13559 requires that faith-based organizations 
administering a program that is supported by direct Federal financial 
assistance give written notice, in a manner prescribed by the agency, 
to beneficiaries and prospective beneficiaries, of their right to be 
referred to an alternate provider when available. Written notice should 
be provided prior to enrollment or receipt of services. However, when 
the nature of the service provided or exigent circumstances make it 
impracticable to provide such written notice in advance of the actual 
service, service providers must advise beneficiaries of their 
protections at the earliest available opportunity. A sample 
notification of beneficiary rights is attached in Appendix A.
    In addition, there is a limited exception to the individual notice 
requirement at Sec.  16.4(f). When the service provided involves only a 
brief interaction between the service provider and the beneficiary, and 
the beneficiary is receiving what may be a one-time service from the 
provider (such as a meal at an emergency kitchen, or one-time 
assistance with rent, mortgage payments, or utility bills), the service 
provider may post the written notice of beneficiary protections in a 
prominent place, in lieu of providing individual written notice to each 
beneficiary. Such posting does not relieve an organization of its 
obligations under the remainder of this part.
    If a beneficiary or prospective beneficiary of a social service 
program supported by Federal financial assistance objects to the 
religious character of an organization that provides services under the 
program, the beneficiary must be referred to an alternate provider. 
More specifically,

[[Page 47248]]

the proposed rule provides that, if a beneficiary or prospective 
beneficiary of a program supported by direct Federal financial 
assistance objects to the religious character of an organization that 
provides services under the program, that organization shall within a 
reasonably prompt time undertake reasonable efforts to identify and 
refer the beneficiary to an alternate provider. Further, the executive 
order and the proposed rule require the relevant awarding entity to 
ensure that appropriate and timely referrals are made to an appropriate 
provider, and that referrals are made in a manner consistent with 
applicable privacy laws and regulations.
    When appropriate, USDA may require the awarding entity to provide 
organizations information about alternate providers, and the 
organization that provides services may rely on that information to 
fulfill its duty under this proposed rule. For example, in the case of 
The Emergency Food Assistance Program (TEFAP), a State Distributing 
Agency may provide contact information for beneficiaries of publicly 
available Web sites or telephone ``hotlines'' that direct individuals 
to local emergency kitchens or pantries, a list of the emergency 
kitchens or pantries to which the State Distributing Agency distributes 
food, or another applicable directory or list of food assistance. It 
must be noted that in some instances, the awarding entity may also be 
unable to identify a suitable alternate provider within a reasonable 
geographic proximity.
5. Amending Existing 7 CFR Part 16 To Include Executive Order 13559 
Changes
    USDA also proposes to amend the other paragraphs in 7 CFR part 16 
to include the new Executive Order 13559 principles and to make 
clarifying changes, including the replacement of the term ``inherently 
religious'' with ``explicitly religious,'' and adding the term ``USDA 
direct assistance'' where appropriate.

III. Regulatory Information

A. Executive Orders 12866 and 13563: Regulatory Planning and Review

    Executive Order 12866, ``Regulatory Planning and Review,'' and 
Executive Order 13563, ``Improving Regulation and Regulatory Review,'' 
direct agencies to assess all costs and benefits of available 
regulatory alternatives and, if regulation is necessary, to select 
regulatory approaches that maximize net benefits (including potential 
economic, environmental, public health and safety effects, distributive 
impacts, and equity). Executive Order 13563 emphasized the importance 
of quantifying both costs and benefits, reducing costs, harmonizing 
rules, and promoting flexibility. The Office of Management and Budget 
(OMB) designated this rule as not significant under Executive Order 
12866 and, therefore, OMB has not reviewed this proposed rule.

B. Clarity of the Regulation

    Executive Order 12866, as supplemented by Executive Order 13563, 
requires each agency to write all rules in plain language. In addition 
to your substantive comments on these proposed rules, we invite your 
answers in response to the questions below, as comments. For example:
     Are the requirements in the rule clearly stated? Are the 
scope and intent of the rule clear?
     Does the rule contain technical language or jargon that is 
not clear?
     Is the material logically organized?
     Would changing the grouping or order of sections or adding 
headings make the rule easier to understand?
     Could we improve clarity by adding tables, lists, or 
diagrams?
     Would more, but shorter, sections be better? Are there 
specific sections that are too long or confusing?
     What else could we do to make the rule easier to 
understand?

C. Regulatory Flexibility Act

    The Regulatory Flexibility Act (5 U.S.C. 601-612), as amended by 
the Small Business Regulatory Enforcement Fairness Act of 1996 
(SBREFA), generally requires an agency to prepare a regulatory 
flexibility analysis of any rule subject to the notice and comment 
rulemaking requirements under the Administrative Procedure Act (5 
U.S.C. 553) or any other statute, unless the agency certifies that the 
rule will not have a significant economic impact on a substantial 
number of small entities. USDA has determined that this rule will not 
have a significant impact on a substantial number of small entities. 
Consequently, USDA has not prepared a regulatory flexibility analysis.

D. Executive Order 12988: Civil Justice Reform

    This proposed rule has been reviewed in accordance with Executive 
Order 12988, ``Civil Justice Reform.'' The provisions of this proposed 
rule will not have preemptive effect with respect to any State or local 
laws, regulations, or policies that conflict with such provision or 
which otherwise impede their full implementation. The rule will not 
have retroactive effect.

E. Executive Order 13132: Federalism

    This rule has been reviewed under Executive Order 13132, 
``Federalism.'' The policies contained in this rule would not have any 
substantial direct effect on States, on the relationship between the 
Federal Government and the States, or on the distribution of power and 
responsibilities among the various levels of government. Also, this 
rule would not impose substantial direct compliance costs on State and 
local governments. Therefore, consultation with the States is not 
required.

F. Executive Order 12372: Intergovernmental Review of Federal Programs

    Executive Order 12372, ``Intergovernmental Review of Federal 
Programs,'' requires consultation with State and local officials. The 
objectives of the Executive Order are to foster an intergovernmental 
partnership and a strengthened Federalism, by relying on State and 
local processes for State and local government coordination and review 
of proposed Federal financial assistance and direct Federal 
development. For reasons set forth in the Notice to 7 CFR part 3015, 
subpart V (48 FR 29115, June 24, 1983), the programs and activities 
within this rule are excluded from the scope of Executive Order 12372.

G. Executive Order 13175: Consultation and Coordination With Indian 
Tribal Governments

    This rule has been reviewed for compliance with Executive Order 
13175, ``Consultation and Coordination with Indian Tribal 
Governments.'' The Executive Order imposes requirements on the 
development of regulatory policies that have Tribal implications or 
preempt Tribal laws. The USDA Office of Tribal Relations has concluded 
that the policies contained in this rule do not, to our knowledge, 
preempt Tribal law.

H. Paperwork Reduction Act (PRA)

    In accordance with the Paperwork Reduction Act (PRA) of 1995 (44 
U.S.C. Chapter 35, as amended), an agency may not conduct or sponsor a 
collection of information, and a person is not required to respond to a 
collection of information, unless the collection displays a currently 
valid OMB control number. The new information collection requirements 
contained in the proposed rule have been submitted to OMB for review, 
pursuant to 44 U.S.C. 3507(d).
    The proposed rule includes a new information collection section. 
Sections 16.4(f) and (g) would impose requirements on faith-based

[[Page 47249]]

organizations that carry out activities under a USDA program with 
direct Federal financial assistance to give beneficiaries (or 
prospective beneficiaries) written notice of certain protections 
described in this proposed rule. Beneficiaries can provide a written 
response that may impose a burden under the PRA, and faith-based 
organizations must provide a referral if a beneficiary or prospective 
beneficiary objects to the religious character of the organization.
    USDA estimates that a faith-based organization would need 2 minutes 
to distribute to each beneficiary the notice required in these proposed 
regulations. This estimate takes into consideration the likelihood 
that, in one-on-one interactions between a staff member and a 
beneficiary, providing the notice might take longer than a minute. 
Conversely, providing notice to a group of beneficiaries at the same 
time would take significantly less than a minute for each beneficiary 
because a few beneficiaries would pass the notice to the remaining 
beneficiaries in a group.
    USDA estimates that in cases where a beneficiary objects to the 
religious character of a faith-based organization, the time required 
for the faith-based organization to make a reasonable effort to 
identify an alternate provider and refer a beneficiary to that provider 
would be about 2 hours. This estimate includes the time required to 
identify service providers that provide similar services, preferably 
under the same or similar programs, to the one under which the 
beneficiary is being served by the faith-based organization. This 
estimate includes the time required in a situation where the 
beneficiary asks the faith-based organization to follow up either with 
the beneficiary or the alternative service provider in order to 
determine whether the referral was successful.
    The U.S. Department of Health and Human Services, Substance Abuse 
and Mental Health Services Administration (SAMHSA), implemented a 
similar referral requirement in its 2003 final rule, Charitable Choice 
Regulations Applicable to States Receiving Substance Abuse Prevention 
and Treatment Block Grants, Projects for Assistance in Transition From 
Homelessness Formula Grants, and to Public and Private Providers 
Receiving Discretionary Grant Funding from SAMHSA for the Provision of 
Substance Abuse Services Providing for Equal Treatment of SAMHSA 
Program Participants (SAMHSA Program Rule), 68 FR 56430. Since SAMHSA 
implemented the referral requirement, the SAMHSA program office has 
received no reports of requests for an alternate provider. Because 
faith-based organizations are required to provide a written 
notification of the beneficiary's rights under this proposed rule, 
requests for referrals may be more likely. However, given SAMHSA's 
experience, USDA estimates that 0.10 percent of beneficiaries and 
potential beneficiaries would request referrals to alternate providers. 
USDA will monitor its programs to assess whether this estimate is 
accurate.
    USDA is not estimating the burden of maintaining the records needed 
to demonstrate compliance with the requirements imposed on faith-based 
organizations. USDA has recordkeeping requirements included in 
information collection instruments for USDA programs. Those collection 
instruments cover burdens imposed by program and administrative 
requirements that exist under current, OMB-approved, information 
collection instruments; each of those collections has an OMB-assigned 
information collection control number.
    The recordkeeping burden that this proposed rule would add to those 
program-specific information collection instruments is so small that, 
under most programs, it would not measurably increase the burden that 
already exists under current program and administrative requirements. 
If, due to the unique nature of a particular program, the recordkeeping 
burden associated with these proposed regulations is large enough to be 
measurable, that burden will be calculated under the recordkeeping and 
reporting requirements of the affected program and identified in 
information collection requests that are submitted to OMB for PRA 
approval. Therefore, we have not included any estimate of the 
recordkeeping burden in this PRA analysis.
    The burden of the information collections in this proposed rule is 
estimated as follows:

                                                           Reporting and Recordkeeping Burden
                                             [Faith based organizations reporting and recordkeeping burden]
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                           Number of                                         Estimated
             Reg. section                           Program                Number of     responses per   Estimated average response time   annual burden
                                                                          respondents     beneficiary                                          hours
--------------------------------------------------------------------------------------------------------------------------------------------------------
24 Section 5.109(g)...................  NIFA--Community Foods Projects
                                         Competitive Grants Program:
                                           Written Notice of Rights              1,000               1  .03 (2 min.)....................              30
                                            handout.
                                           Referral...................               1               1  2.00 hrs........................               2
                                        FNS--The Emergency Food
                                         Assistance Program--Pantries
                                         (TEFAP): \13\
                                           Referral...................           3,042               1  2...............................           6,084
                                        FNS--The Emergency Food
                                         Assistance Program--Kitchens
                                         (TEFAP):
                                           Referral...................             368               1  2...............................             736
                                        RD--Community Facilities:
                                           Written Notice of Rights             13,875               1  0.03............................             416
                                            handout.
                                           Referral...................              14               1  2...............................              28
                                        RD--Business Programs:
                                           Written Notice of Rights              2,319               1  0.03............................              70
                                            handout.
                                           Referral...................               2               1  2...............................               4
                                        RD--Housing:
                                           Written Notice of Rights              1,577               1  0.03............................              47
                                            handout.
                                           Referral...................               2               1  2...............................               4
                                                                       ---------------------------------------------------------------------------------
                                        Totals........................          22,181  ..............  ................................           7,421
--------------------------------------------------------------------------------------------------------------------------------------------------------


[[Page 47250]]

    In accordance with 5 CFR 1320.8(d)(1), USDA is soliciting comments 
from members of the public and affected agencies concerning this 
collection of information to:
---------------------------------------------------------------------------

    \13\ Analysis for Written Notice of Rights handout not provided 
for TEFAP, as notification will be posted in a prominent place in 
lieu of a handout.
---------------------------------------------------------------------------

    (1) Evaluate whether the proposed collection of information is 
necessary for the proper performance of the functions of the agency, 
including whether the information will have practical utility;
    (2) Evaluate the accuracy of the agency's estimate of the burden of 
the proposed collection of information, including the validity of the 
methodology and assumptions used;
    (3) Enhance the quality, utility, and clarity of the information to 
be collected; and
    (4) Minimize the burden of the collection of information on those 
who are to respond, including through the use of appropriate automated 
collection techniques or other forms of information technology, for 
example, permitting electronic submission of responses.
    Interested persons are invited to submit comments regarding the 
information collection requirements in this rule. Comments must refer 
to the proposed rule by name and docket number (RIN 0503-AA55) and must 
be sent to:
    USDA Desk Officer, Office of Information and Regulatory Affairs, 
Office of Management and Budget, New Executive Office Building, 
Washington, DC 20503, Email: oira_submission@omb.eop.gov, Fax: (202) 
395-6947

and

    Norah Deluhery, Director, Center for Faith-Based and Neighborhood 
Partnerships, U.S. Department of Agriculture, 1400 Independence Ave. 
SW., Washington, DC 20250.
    Interested persons may submit comments regarding the information 
collection requirements electronically through the Federal eRulemaking 
Portal at http://www.regulations.gov. USDA strongly encourages 
commenters to submit comments electronically. Electronic submission of 
comments allows the commenter maximum time to prepare and submit a 
comment, ensures timely receipt by USDA, and enables USDA to make them 
immediately available to the public. Comments submitted electronically 
through the http://www.regulations.gov Web site can be viewed by other 
commenters and interested members of the public. Commenters should 
follow the instructions provided on that site to submit comments 
electronically.

I. E-Government Act Compliance

    USDA is committed to complying with the E-Government Act, to 
promote the use of the Internet and other information technologies to 
provide increased opportunities for citizen access to Government 
information and services, and for other purposes.

List of Subjects in 7 CFR Part 16

    Administrative practice and procedure. Grant programs.

    Accordingly, 7 CFR Subtitle A is amended as set forth below:

PART 16--EQUAL OPPORTUNITY FOR RELIGIOUS ORGANIZATIONS

0
1. The authority citation for Part 16 is revised to read as follows:

    Authority: 5 U.S.C. 301; E.O. 13279, 67 FR 77141; E.O. 13280, 67 
FR 77145; E.O. 13559, 75 FR 71319.

0
2. Revise paragraph (b) of Sec.  16.1 to read as follows:


Sec.  16.1  Purpose and applicability.

* * * * *
    (b) Except as otherwise specifically provided in this part, the 
policy outlined in this part applies to all recipients and 
subrecipients of USDA assistance to which 2 CFR part 400 applies, and 
to recipients and subrecipients of Commodity Credit Corporation 
assistance that is administered by agencies of USDA.


Sec. Sec.  16.2 through 16.5  [Redesignated as Sec. Sec.  16.3 through 
16.6]

0
3. Redesignate Sec. Sec.  16.2 through 16.5 as Sec. Sec.  16.3 through 
16.6, respectively.

0
4. Add a new Sec.  16.2 to read as follows:


Sec.  16.2  Definitions.

    As used in this part:
    (a) USDA direct assistance is Federal financial assistance provided 
by USDA and means that the Federal 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 grant or cooperative agreement). In 
general, USDA assistance shall be treated as direct, unless it meets 
the definition of ``USDA indirect assistance.''
    (b)(1) USDA indirect assistance is Federal financial assistance 
provided indirectly by USDA and 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'' within the 
meaning of the Establishment Clause of the First Amendment to the U.S. 
Constitution 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;
    (ii) The organization receives the assistance as a result of a 
decision of the beneficiary, not a decision of the government; and
    (iii) The beneficiary has at least one adequate secular option for 
the use of the voucher, certificate, or other similar means of 
government-funded payment.
    (2) 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,'' as those 
terms are used in Executive Order 13559. These recipients of sub-awards 
are considered recipients of USDA direct assistance.
    (c) 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 with the 
provisions of Executive Order 13559 and any implementing rules or 
guidance by the recipient of a contract, grant, or agreement. 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.
0
4. Revise paragraph (a) and the introductory text of paragraph (b) of 
newly redesignated Sec.  16.3 to read as follows:


Sec.  16.3  Rights of religious organizations.

    (a) A religious organization is eligible, on the same basis as any 
other eligible private organization, to access and participate in USDA 
assistance programs. Neither the Federal

[[Page 47251]]

Government nor a State or local government receiving USDA assistance 
shall, in the selection of service providers, discriminate for or 
against a religious organization on the basis of the organization's 
religious character or affiliation. Additionally, decisions about 
awards of USDA direct assistance or USDA indirect 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.
    (b) A religious organization that participates in USDA assistance 
programs will retain its independence and may continue to carry out its 
mission, including the definition, practice, and expression of its 
religious beliefs, provided that it does not use USDA direct assistance 
to support any explicitly religious activities, including activities 
that involve overt religious content such as worship, religious 
instruction, or proselytization. Among other things, a religious 
organization may:
* * * * *
0
5. Amend newly redesignated Sec.  16.4 as follows:
0
a. Revise paragraphs (b) and (d); and
0
b. Add new paragraphs (e), (f), and (g).
    The revisions and additions read as follows:


Sec.  16.4  Responsibilities of participating organizations.

* * * * *
    (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 supported with 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. These restrictions on explicitly religious 
activities do not apply where USDA funds or benefits are provided to 
religious organizations as a result of a genuine and independent 
private choice of a beneficiary or through other indirect funding 
mechanisms, provided the religious organizations otherwise satisfy the 
requirements of the program.
* * * * *
    (d)(1) USDA direct assistance may be used for the acquisition, 
construction, or rehabilitation of structures only to the extent that 
those structures are used for conducting USDA programs and activities 
and only 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 explicitly religious activities, USDA direct 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 assistance funds for equipment, 
supplies, labor, indirect costs, and the like shall be prorated between 
the USDA program or activity and any use for other 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.
    (e) USDA direct assistance under any USDA program may not be used 
for explicitly religious activities, speech, and materials generated or 
controlled by the administrators, instructors, or officials of the 
organization receiving USDA direct assistance.
    (f) Beneficiary protections: Written notice. (1) Faith-based 
organizations that receive USDA direct assistance under any USDA 
program must give written notice in a manner prescribed by USDA to all 
beneficiaries and prospective beneficiaries of their right to be 
referred to an alternate provider when available. The written notice 
must be given in a manner prescribed by USDA, and state that:
    (i) The organization may not discriminate against beneficiaries on 
the basis of religion or religious belief;
    (ii) The organization may not require beneficiaries to attend or 
participate in any explicitly religious activities that are offered by 
the organization, and any participation by beneficiaries in such 
activities must be purely voluntary;
    (iii) The organization must separate in time or location any 
privately funded explicitly religious activities from activities 
supported by direct Federal financial assistance;
    (iv) If a beneficiary objects to the religious character of the 
organization, the organization will undertake reasonable efforts to 
identify and refer the beneficiary to an alternate provider; the 
organization may not be able to guarantee, however, that in every 
instance, an alternate provider will be available; and
    (v) Beneficiaries may report violations of these protections to 
USDA (or, the intermediary, if applicable).
    (2) This written notice must be given to beneficiaries prior to the 
time they enroll in the program or receive services from such programs. 
When the nature of the service provided or exigent circumstances make 
it impracticable to provide such written notice in advance of the 
actual service, service providers must advise beneficiaries of their 
protections at the earliest available opportunity.
    (g) Beneficiary protections: Referral requirements. If a 
beneficiary or prospective beneficiary of a social service program 
supported by USDA objects to the religious character of an organization 
that provides services under the program, that organization must 
promptly undertake reasonable efforts to identify and refer the 
beneficiary to an alternate provider, within reasonable geographic 
proximity to the provider, if available, to which the prospective 
beneficiary has no objection. In making the referral, the organization 
shall comply with all applicable privacy laws and regulations.
    (1) A referral may be made to another faith-based organization, if 
the beneficiary has no objection to that provider. But if the 
beneficiary requests a secular provider, and a secular provider is 
available, then a referral must be made to that provider.
    (2) Except for services provided by telephone, Internet, or similar 
means, the referral must be to an alternate provider that is in 
reasonable geographic proximity to the organization making the referral 
and that offers services that are similar in substance and quality to 
those offered by the organization, if one is available. The alternate 
provider also should have the capacity to accept additional clients, if 
one with capacity to accept additional clients is available.
    (3) When the organization makes a referral to an alternate 
provider, or when the organization determines that it

[[Page 47252]]

is unable to identify an alternate provider, the organization shall 
notify the awarding entity. If the organization is unable to identify 
an alternate provider, the awarding entity shall determine whether 
there is any other suitable alternate provider to which the beneficiary 
may be referred. An intermediary that receives a request for assistance 
in identifying an alternate provider may request assistance from USDA 
or a State or local government receiving USDA direct assistance.
    (4) In some cases, USDA may require that the awarding entity 
provide the organization with information regarding alternate 
providers. Such information regarding alternative providers should 
include providers (including secular organizations) within a reasonable 
geographic proximity that offer services that are similar in substance 
and quality and that would reasonably be expected to have the capacity 
to accept additional clients, provided any such organizations exist. An 
organization which relies on such information provided by the awarding 
entity shall be considered to have undertaken reasonable efforts to 
identify an alternate provider under this subpart.
0
6. Revise newly redesignated Sec.  16.5 to read as follows:


Sec.  16.5  Effect on State and local funds.

    If a State or local government voluntarily contributes its own 
funds to supplement activities carried out under programs governed by 
this part, the State or local government has the option to separate out 
the USDA direct assistance funds or comingle them. If the funds are 
comingled, the provisions of this part shall apply to all of the 
comingled funds in the same manner, and to the same extent, as the 
provisions apply to the USDA direct assistance.
0
7. Add Appendix A to part 16 to read as follows:

Appendix A to Part 16--Written Notice of Beneficiary Rights

Name of Organization:
Name of Program:
Contact Information for Program Staff (name, phone number, and email 
address, if appropriate):

    Because this program is supported in whole or in part by 
financial assistance from the Federal Government, we are required to 
let you know that--
     We may not discriminate against you on the basis of 
religion or religious belief;
     We may not require you to attend or participate in any 
explicitly religious activities that are offered by us, and any 
participation by you in these activities must be purely voluntary;
     We must separate in time or location any privately 
funded explicitly religious activities from activities supported 
with USDA direct assistance;
     If you object to the religious character of our 
organization, we must make reasonable efforts to identify and refer 
you to an alternate provider. We cannot guarantee, however, that in 
every instance, an alternate provider will be available; and
     You may report violations of these protections to _.
    We must provide you with this written notice before you enroll 
in our program or receive services from the program, as required by 
7 CFR part 16.

BENEFICARY REFERRAL REQUEST

    If you object to receiving services from us based on the 
religious character of our organization, please complete this form 
and return it to the program contact identified above. Your use of 
this form is voluntary.
    If you object to the religious character of our organization, we 
must make reasonable efforts to identify and refer you to an 
alternate provider to which you have no objection. We cannot 
guarantee, however, that in every instance, an alternate provider 
will be available. With your consent, we will follow up with you or 
the organization to which you are referred to determine whether you 
have contacted that organization.
    ( ) Please check if you want to be referred to another service 
provider.
    Please provide the following information if you want us to 
follow up with you:
    Your Name:
    Best way to reach me (phone/address/email):
    Please provide the following information if you want us to 
follow up with the service provider only.

    Your Name:
    You are permitted to withhold your name, though if you choose to 
do so, we will be unable to follow up with you or the service 
provider about your referral.
    ( ) Please check if you do not want follow up.

-----------------------------------------------------------------------

    FOR STAFF USE ONLY

    1. Date of Objection: __/__/__
    2. Referral (check one):
    ( ) Individual was referred to (name of alternate provider and 
contact information):
    ( ) Individual left without a referral
    ( ) No alternate service provider is available--summarize below 
what efforts you made to identify an alternate provider (including 
reaching out to USDA or the intermediary, if applicable):
    3. Follow-up date: __/__/__
    ( ) Individual contacted alternate provider
    ( ) Individual did not contact alternate provider
    4. Staff name and initials:

    Dated: July 16, 2015.
Thomas J. Vilsack,
Secretary.
[FR Doc. 2015-18262 Filed 8-5-15; 8:45 am]
BILLING CODE 3410-90-P