Government Shekels without Government Shackles

Although governmental partnerships with religious organizations and their affiliates has been a feature of the social service landscape for decades, Charitable Choice has been attacked from Left and Right alike.

Government Shekels without Government Shackles?
The Administrative Challenges of Charitable Choice

Sheila Suess Kennedy
Wolfgang Bielefeld

In 1996, Congress passed the Personal Responsibility and Work Opportunity Reconciliation Act, reforming welfare “as we know it.”[1] Among the provisions of that bill was a “Charitable Choice” requirement that states contract with faith-based social service providers on the same basis as they contract with other nonprofits. The bill specified that “pervasively sectarian” organizations were not to be discriminated against; that such providers should be allowed to maintain hiring policies based upon their religious dictates; and that they could not be required to divest the premises where services were delivered of religious iconography.
Although governmental partnerships with religious organizations and their affiliates has been a feature of the social service landscape for decades, Charitable Choice has been attacked from Left and Right alike. Civil libertarians object to provisions that, for the first time, would allow employment discrimination with public funds, and worry that the legislation is part of a new assault on separation of Church and State. Religious Right activists demand assurances that funds will not flow to disfavored groups like the Nation of Islam, or the Scientologists.  African-American pastors in urban areas—arguably the main targets of the initiative—are concerned that “government shekels” will be accompanied by “government shackles,” that the costs and regulatory burdens involved in collaborations with government will divert resources from client services and will mute their prophetic voice.
Caught in the middle are public managers, who must make the legislation work in the face of significant administrative challenges. Those challenges can be grouped into three major areas: outreach and contracting procedures; contract administration; and evaluation. In each of these categories, political realities and constitutional constraints will significantly complicate the manager’s job.


Federal and state government units have provided services through nonprofit and religious organizations since the inception of government social welfare programs, although the media characterization of Charitable Choice and President Bush’s faith-based initiative as “new” or even “revolutionary” has tended to obscure that history (U.S. Senate Judiciary Committee 2001).  In a 1969 study of findings from a 1965 survey of 406 sectarian agencies in 21 states, Bernard J. Coughlin reported that 70 percent of them were involved in some type of purchase of service contract with the government.  A 1982 study by F. Ellen Netting, focusing on government funding of Protestant social service agencies in one Midwestern city, found that some agencies received between 60 and 80 percent of their support from the government, and that approximately half of their combined budgets were government-financed. In 1994, government funding accounted for 65 percent of the nearly two billion dollar annual budget of Catholic Charities USA, and 75 percent of the revenues of the Jewish Board of Family and Children’s Services (Monsma 1996; Brown and McKeown 1997; Minow 2000). As the American Jewish Committee (AJC) noted in a 1990 Report of its Task Force on Sectarian Social Services and Public Funding,
…there has been a long-standing history of governmental aid to certain sectarian social programs, demonstrating that, in the non-educational context, there may be substantial involvement between the state and sectarian institutions. The government has provided aid to sectarian homes for the elderly, foster child care homes, and hospitals…The legitimacy of such aid, as a matter of broad public principle, was confirmed in the Supreme Court case Bowen v. Kendrick (1988). In so ruling the Court relied upon a nearly century-old decision in which it had upheld unanimously the provision of public funds to a sectarian-affiliated hospital, Bradford v. Roberts (1899)—the only other time the Court had directly addressed the issue (AJC 1990, 5).
Confounding both historical and constitutional analyses of Charitable Choice and President Bush’s subsequent faith-based initiative is the fact that our public debate, and much existing First Amendment case law, assumes the interchangeability of “religious,” “sectarian,” and “faith-based” as descriptive terms. The rhetoric used by Congressional supporters of Charitable Choice, on the other hand, suggested a more specialized meaning; however, neither the legislation nor representatives of the White House Office of Faith-Based and Community Initiatives has defined what “faith based” means for purposes of Charitable Choice. Many religious providers with histories of social welfare provision are “faith-based” in the most literal sense—that is, the provision of essentially secular social services is motivated by their religious beliefs. Feeding and clothing the poor, tending to the sick, and housing the aged are approached as religious duties, rather than as opportunities for proselytizing or transforming the individuals served.  However, this is by no means universally true of religious organizations that have historically received government funding, especially old-age and child-care facilities (AJC 1990). The Salvation Army has long received substantial funding, despite being “pervasively sectarian” by almost any definition of that term. (Winston 2001) Individual congregations are “faith based” by definition; yet studies show that twenty percent of congregations providing social services engage in collaboration with government agencies. Most of those partnerships preceded passage of Charitable Choice (U.S. Senate Judiciary Committee 2001; Chavez 2001).
The character of these relationships has been anything but clear and defined; indeed, the network of social service provision is complex, intertwined, and frequently ad hoc (Wineburg 2001). As the AJC’s Task Force delicately noted, there have been “problems” when provision of services by a religious provider has been inconsistent in some fashion with the mandates of state law or constitutional imperatives. For example, Catholic foster care agencies are funded in Illinois despite their noncompliance with state law mandating that teens be provided with birth control. These and similar “problems” have frequently been “solved” by unspoken understandings, “otherwise known as ‘not talking about it’” (AJC 1990, 8).
Given this history and background, it would have been helpful had Congress addressed several important questions: what does “faith-based” mean in this context?  Do FBOs targeted by the Charitable Choice legislation differ from those with a long history of governmental contractual relationships? If so, how?  What are the barriers to their participation in social service delivery? To what extent are those barriers practically necessary or constitutionally mandatory?  What is the availability and interest, and what are the capacities, of these organizations?  Few of these questions, however, found their way into the Congressional debates about Charitable Choice (Kennedy 2001), and none were addressed by the legislation.  The resulting ambiguities have created substantial public management issues.
Charitable Choice legislation was explicitly predicated on the assumption that Faith-Based Organizations (FBOs) are more effective and efficient at providing assistance than   the secular and religiously-affiliated nonprofits that have been delivering the bulk of tax-supported social welfare programs on government’s behalf.[2]  However, there is no empirical data available either to support or rebut that presumption. In September, 2000, with support from the Ford Foundation, our research team commenced work on a three-year evaluation of Charitable Choice implementation by three states—Indiana, Massachusetts, and North Carolina—chosen because they represent different political cultures and religious landscapes. We will investigate and analyze state governments’ methods of identifying and working with FBOs; assess the comparative efficacy of faith-based and secular providers; review the capacity of FBOs to bid for, and state governments to manage, purchase-of-service contracts; and address issues of public and constitutional accountability. During the first year of the project, as we have pursued our primary research objectives, we have also encountered and identified many of the practical issues confronting public managers who find themselves charged with translating the legislation into action.


Outreach and Contracting Procedures

If Charitable Choice is intended to make government contracts more “user friendly” to FBOs who have not previously partnered with the public sector, so as to encourage their entry into social service partnerships (DiIulio 2001), the first task for public managers will be to inventory their current procurement processes in order to identify and remove existing barriers. Public managers must then develop criteria for identifying, and mechanisms for reaching out to, new faith-based partners (FBOs).
Not surprisingly, the identification of barriers disadvantaging FBOs has elicited different responses in different states. Massachusetts significantly revamped its procurement processes in 1995, with the express purpose of making the government contracting process more accessible and transparent to all potential bidders. Massachusetts officials believe the revamped process does not contain barriers to FBO participation; furthermore, the state points to its long history of contracting with Catholic, Lutheran and Jewish agencies. (Jensen 2001)  While the Center for Public Justice gave Massachusetts an “F” on its recent “report card” rating the states on implementation of Charitable Choice (Center for Public Justice 2000), state officials took the position that the legislation was intended to “level the playing field” and Massachusetts’ field was already level.   
North Carolina has approached implementation primarily through an existing effort: the Communities of Faith Initiative of the North Carolina Rural Economic Development Center. Launched in the early 1990’s, the program worked across denominational and racial lines to address the needs of rural inhabitants of North Carolina, particularly those living in or near poverty. The most numerous and powerful institutions in rural North Carolina were the churches; accordingly, it was through an alliance of those churches that the Rural Center proposed to deliver services. Subsequent to enactment of Charitable Choice, the Center has held two conferences, and has entered into a contract with the North Carolina Division of Social Services to initiate a church-based pilot program to support rural families as they move from welfare to work. “Faith Demonstration Awards” were made to five faith-based projects, most of which serve more than one county but none of which are statewide in scope. Communities of Faith also does training for FBOs; in 2000, organizations from 42 North Carolina counties attended its Faith With Works seminars.
Indiana has been the most ambitious of the three states we are studying. The state established an initiative called FaithWorks, designed to reach out to faith-based organizations that had not previously contracted with the state, and to assist them with capacity-building and technical assistance. FaithWorks’ short-term goal is to give such organizations the tools, access and information needed to become competitive with traditional providers. Its long-term goal is the creation of networks and links that will allow the faith community to sustain an effective presence in the area of social service delivery. As part of an overall outreach effort to the faith community, six informal meetings were held around the state in February of 2000. Invitations were sent to houses of worship and nonprofit service providers affiliated with religious organizations, although any interested organization was welcome to send representatives. Approximately one thousand people attended.  During the year, four hundred organizations received technical assistance, either through state-paid consultants or by attending state-sponsored workshops. Workshops included descriptions of the Charitable Choice legislation, state procurement procedures, the contracting process, effective proposal development, TANF program requirements and fiscal management and accountability.  In addition, information and technical support is provided via a website and toll-free phone assistance.
“Affirmative action” outreach programs like Indiana’s FaithWorks or North Carolina’s Community of Faith Initiative are one method of achieving participation by FBOs, and publicizing the existence of a level playing field. Complete revamping of the procurement process, similar to the Massachusetts effort, is another. Whatever approach a state chooses, it must confront, as a threshold issue, the establishment of appropriate criteria for bidders. For example, some supporters of Charitable Choice criticize requirements for professional credentials and norms. In a recent article in Commentary, Les Lenkowsky argues for “elimination of arbitrary rules that allow, for example, the use of professional therapy but not pastoral counseling.” (Lenkowsky 2001, 23) If an agency is putting together an RFP for counseling services, and requires that successful bidders employ licensed social workers, has the state discriminated against FBOs offering unlicensed “pastoral counseling”?   Lenkowsky clearly believes it has, although other religious spokespersons disagree[3]. On the other hand, states are accountable for the quality of the services they provide, and have a legal obligation to evaluate the ability of bidders to provide those services at an appropriate level. If the bidder offers “pastoral counseling,” in lieu of professional certification, how is the probable efficacy of that counseling to be assessed? If the state appears to relax or discard professional standards when the bidder is an FBO, secular nonprofits and current state contractors may justifiably object that an unconstitutional preference is being shown to religious organizations in violation of the Establishment Clause.
In his recent testimony on Faith Based Solutions before the Senate Committee on the Judiciary, John L. Avery of the Association for Addiction Professionals focused upon precisely that issue.
“NAADAC’s concern is not with who provides care, but rather by what clinical standards that care is provided. We are committed to the application of science-based best practices, perhaps as most succinctly stated in the National Institute of Drug Abuse (NIDA) publication, ‘Principles of Drug Addiction Treatment, a Research-based Guide.’”
Avery emphasized that, for his organization, the “salient issue is the clinical competency of the treatment provider” and concern for consumer protection and public safety.
If FBOs believe insistence on evidence of “clinical competency” is discriminatory, and the NAADC believes that failure to require such evidence is malpractice, it is no wonder that many public administrators feel caught in an untenable situation.[4] 
The states we are studying have also taken different approaches to the issue of who qualifies as an FBO. Massachusetts, as indicated, considers religious providers essentially fungible, both with other sectarian organizations and with secular providers: Catholic Charities, store-front church or secular provider—all are officially considered equal, and evaluated solely with respect to the responsiveness of their bid. If lack of prior experience operates to disadvantage some bidders, that is considered to be unfortunate but irrelevant.   In Indiana, at least for record-keeping purposes, the state “counts” as FBOs only those participating in both Faithworks and the Indiana Manpower Placement and Comprehensive Training (IMPACT) program.  IMPACT is Indiana’s welfare reform demonstration project; it includes cash assistance and employment services programs for needy and eligible families with dependent children, and is funded with TANF dollars. While religious agencies are free to participate in other programs, and both religious and nonreligious providers can access FaithWorks resources, only IMPACT contractors make the “official” FBO list.  This approach to categorization has generated anomalies that make comparisons difficult: An Indianapolis homeless shelter created and supported by a group of churches and other nonprofits, whose Executive Director is an ordained minister, for example, is not considered “faith based” for Indiana’s record-keeping purposes; however, a for-profit corporation which participates in IMPACT, is classified as an FBO, and self-identifies as faith-based.

In his recent testimony before the Judiciary Committee, Douglas Laycock noted that “choosing someone to deliver social services is more complex than picking the low bidder on a pencil contract. How do you keep thousands of government employees, federal state and local, from discriminating on religious grounds when they award grants and contracts?”  Laycock endorsed a “reporting requirement” that would require “explanation” of any “obvious over-or-under representation” of religious providers. Whatever the merits of such a requirement, it would be yet another bureaucratic task requiring at least some level of resource allocation.  Whether such a mechanism would minimize claims of bias is an open question; as Richard Foltin of the American Jewish Committee has noted,

“It seems almost inevitable that, whatever claims may be made that contracts will be allocated on the basis of merit, in any given community the religious groups most likely to receive funds will be those associated with ‘mainstream’ faiths. And, even if the contracts are allocated on a totally objective basis, there is likely to be sharp distrust and suspicion that this is not the case.”

                                                Contract Monitoring

Early experience in Indiana suggests that monitoring first-time FBOs requires considerably more resources, more “hands-on” help, than is needed with more experienced providers (Raibley 2001). This can be expected to diminish as such providers become more sophisticated about government’s expectations, but that will take some time.
There is also a significant constitutional issue involved in monitoring, since the Free Exercise Clause protects religious organizations against unwarranted intrusion, and what is “unwarranted” is a fact-based inquiry. Even if audit and accountability measures are perfectly appropriate constitutionally, elected officials have expressed concerns that, should state agencies find FBO compliance inadequate, charges of bias will be leveled and may well resonate politically. To the extent Charitable Choice focuses upon inner city churches, race will inevitably become a part of the political equation in such situations, a prospect that concerns even strong supporters of Charitable Choice and vigorous outreach efforts.[5]
If government oversight is not to be viewed as racially or religiously discriminatory, great care will need to be exercised to eliminate unintended disparities in the monitoring process. Oversight methodology and criteria will need to be well-conceived, and they will need to be communicated before the fact and with clarity.
State agencies are constitutionally required to insure that government funds go only to support secular activities. Consistent with that requirement, the Charitable Choice legislation prohibits use of tax dollars for proselytizing, and prohibits conditioning service delivery upon participation in religious activities. Public managers are responsible for compliance with those restrictions; however, states have limited managerial resources with which to monitor programmatic content for constitutional compliance. Middle managers hired to administer welfare service contracts cannot be expected to recognize any but the most egregious First Amendment violations, and have limited time to devote to such issues. If a violation is alleged and proven, however, the state can be held liable.  As the Welfare Information Network frames the issue on a section of its Website devoted to discussion of frequently asked questions,

“State or local jurisdictions should consider these terms [“faith based organization” and “proselytization”] when working on contracting arrangements that are covered by Section 104 of the federal welfare reform law, P.L. 104-193, also known as the "Charitable Choice" provisions. Contracting with funds under the Temporary Assistance to Needy Families Program is covered by Section 104. The law does not offer definitions of "religious organization" and "proselytization," and although some states may have defined these terms in case law related to schooling or other issues, they are not familiar to many contract officers.
Given the lack of precedents, states and local jurisdictions generally have avoided legally binding definitions in their contracts, especially as to what constitutes proselytization. Instead, dialogue and "gut instinct" are guiding the implementation of the ban on proselytization when contracting with federal funds. This approach could include: ensuring that organizations bidding on a contract know in advance about the prohibition on using the contract funds for proselytization; talking with the contracting organization about the state or local agency’s expectations, and the consequences of any problems reported with proselytization; and ensuring that participants are aware of the ban and what steps they can take if they feel uncomfortable receiving services from a religious provider. For example, Section 104 provides welfare recipients the right to seek alternative providers. Religious organizations have certain rights under Section 104 as well.[6]   

As Rev. Castañón of the United Methodist church warned in his testimony to the Senate Judiciary Committee on Faith Based Solutions,

“As long as government attempts to separate what is religious from secular in entities like churches, synagogues, mosques, etc. it risks becoming excessively entangled with religion, thus advancing it or hindering religion, both clear violations of the establishment clause.”
Finally, there is the requirement that secular alternatives be provided for welfare recipients who do not want a faith-based provider. Public managers will need to identify such alternatives and fund them. This should not present a problem in urban areas, but it can be a challenge in more rural states, or rural areas of states, where alternative providers may not be convenient, or even available, or in very homogeneous communities.[7] In situations where the FBO substantially performs under the contract before the client requests a change, contract allocation and bookkeeping issues must be dealt with.


State agencies should evaluate the efficacy of all service providers, secular or religious. Such evaluation was problematic well before the passage of Charitable Choice; in all three of the states we are studying, the social welfare system is so radically decentralized and uncoordinated as to make sound evaluation of programs virtually impossible. In addition, welfare populations are notoriously difficult to track: poor people move frequently, often do not have telephones, and are frequently unresponsive to or intimidated by survey forms and other formal inquiries. The lack of credible data is one reason that welfare policies generally elicit such strong disagreements among scholars and policymakers.
Those who support expansion of Charitable Choice, and increased reliance by government on nonprofits generally, insist that such “mission-driven” organizations are more effective than secular providers. To date, there is virtually no data about FBO performance. This is not surprising, given that the comparative performance of nonprofit, for-profit and government organizations generally is far from settled.  The lack of data about FBO performance is, however, particularly problematic given the current contentious political climate.  A debate about the relative advantages of for-profit over nonprofit service provision has raged since the first privatization efforts in the early 1980s.  Research, while growing, remains weak, and the findings have been equivocal.  Studies, moreover, have focused on only a few service areas, primarily in the health care sector, child care, and education (for recent summaries see Hansmann 1996; Weisbrod 1998; Schlesinger 1998; Krashinsky 1998; Mauser 1998). 
Reliable scholarship can provide public managers with important answers: are FBOs more efficient and effective? Are they more effective in some areas than others? Are some FBOs more effective than other FBOs? If so, what are the characteristics of the more and less effective organizations? If evaluators are to answer such questions, however, clarity and consistency of terminology and objectives will be required: who shall be classified as an FBO? How shall we define “success”? 
Public managers must measure success—once defined—without intruding upon the constitutional prerogatives of the religious organization. This can be especially difficult when the FBO has chosen not to form a 501(c)(3) affiliate, because monitoring and evaluation of fiscal performance will require review of books and records, and program costs may not have been segregated from other financial information.  Even if there is a separate 501(c)(3), some inquiry into the finances of the religious organization may be necessary if, for example, a church or synagogue is providing substantial in-kind support. Any analysis of the cost of providing services will include the value of volunteer time, use of church equipment and facilities, and similar accommodations. Valuing those accommodations may require more review than the FBO feels is constitutionally appropriate.   
These are thorny issues, but their resolution is important, because good information is essential if programs are to work.

                                                Early Indicators

The saliency of these issues can be confirmed by a glance at the daily newspapers, which are beginning to report challenges to administrative determinations. Texas, one of the first states to aggressively implement Charitable Choice, has been sued for inadequate monitoring of a church-based drug treatment contractor that allegedly used tax dollars to purchase bibles. California has been sued for allegedly establishing a five million dollar “set aside” to be made available only to faith-based providers. And just this spring, the Texas legislature chose not to continue a Bush administration plan passed in 1997, allowing religious youth facilities to escape state inspection under an “alternative accreditation” program that allowed them to monitor themselves. The legislature was reacting to published charges that teenagers had been made to spend eleven hours in sewage-filled pits, and had suffered other types of abuse and illegal restraint in such homes.
We have carried out extensive discussion with state IMPACT administrators in Indiana and conducted preliminary interviews with nine faith-based providers in the state.  Indiana conducts both financial and non-financial monitoring of all IMPACT providers.  The latter includes assessments of programs, facilities, and relations with other community actors.  Periodic site visits are conducted.  In these as well as subsequent evaluations, no distinctions are made between faith-based and other providers.  That these oversight activities are effective is evidenced by the fact that problems in several faith-based providers have been identified. At least one contract was cancelled when a site inspection revealed that the premises were not handicap-accessible, as required.  Moreover, state administrators in Indiana seem aware of the complexities inherent in administering programs in this set of faith-based organizations, including the ramifications of the fact that many are small and new to the system, and that they are all religiously oriented.
Information from the faith-based providers has provided evidence that many of the administrative challenges discussed above are quite real.  While a number of the providers offered positive comments about the support provided by the state, most also pointed to administrative problems or issues they had encountered.  Difficulty obtaining client referrals was mentioned most often.  While this was partially attributed to increased competition among providers, problems with the client referral system were also alleged.  A number of providers suspected that certain contractors were being favored over others, perhaps for reasons of convenience, or prior working relationships between caseworkers making the referrals and long-term providers. It bears emphasizing that no one had evidence of such favoritism; these speculations were an effort to explain difficulties they perceived in client allocation under the contract.  The existence of these suspicions tends to confirm the concerns raised by Douglas Laycock and Richard Foltin, above.
In addition, many providers reported problems with billing and obtaining payment, including paperwork problems and delays.  A number also reported information problems, including getting conflicting information, little or no information about their problems with referrals or payments, or information about program changes.  While these types of problems are not unique to FBOs new to the contracting system, they nevertheless point up the need for state administrators to spend more time and effort on communication with these smaller, more grass-roots providers who are not familiar with the jargon of administrative bureaucracies and not able to hire lawyers and accountants to “interpret” for them.    
Indeed, the need for better communication was a recurring theme in our discussions with these providers. In some cases providers felt that the state was not aware of or interested in the particulars of the faith-based providers.  They commented that the state was unfamiliar with what they were doing, wasn’t listening to them, and wasn’t interested in feedback or help from them.  This perception may well have been the result of the state attempting to treat all providers equally in order to avoid the perception of disparities.  For the faith-based providers, however, it signified to some that their “special” nature was not being appreciated or most effectively used.  This attitude might also at some point translate into feelings that monitoring and evaluation should take their special characteristics into account.
The issue of achieving proper balance between secular services and religious messages was important to all providers.  The state’s position is that while it is appropriate to display religious symbols, religious activities should be clearly separated from program services and clients should not be pressured into participation in them.  Providers, however, felt that their religious orientation was important, both to their organization and potentially to their clients. Adoption of these religious principles and beliefs was held to be another way that the lives of their clients would be improved.  In addition, providers felt that their religious beliefs gave them a special caring relationship to their clients.  While none of the programs studied had explicitly religious content, providers generally made it clear that religious or spiritual counseling was available to clients if they were interested and all of the programs incorporated to some extent the moral and ethical premises of the faith in question. 
The state is sensitive to the constitutional constraints imposed by the First Amendment, and attempts to monitor program content to insure the separation of secular and religious messages.  There have been several instances where providers have been advised that explicitly religious messages may not be delivered as a part of the state-sponsored program, although it may be separately offered and privately funded. Monitoring in this area requires substantial amounts of both tact and constitutional competence, as well as resources.

Attention to these administrative challenges is really long overdue. Public managers need to ensure the integrity of the bid process for all participants, whether they are large or small, institutionalized or grass-roots, faith-based or secular. Fairness includes at least the validation of bid requirements, and standards for assuring evenhandedness in awarding and monitoring contracts.
Most of all, public managers and academics need to evaluate what works, what doesn’t, and why. Until we have real evidence of the efficacy of various types of social programs, including but certainly not limited to faith-based programs, we will continue to debate these issues on the basis of political ideology and expediency rather than on the basis of scholarship and evidence.



Brown, Dorothy. M., and McKeown, Elizabeth. 1997. The Poor Belong to Us: Catholic Charities and American Welfare.  Cambridge, MA: Harvard University Press.
Chaves, Mark. Interview by author. Chicago, IL, April 2001.
Charitable Choice Compliance: A National Report Card. 2000.  Annapolis, MD: The Center for Public Justice. Available from:$296. Accessed August 1, 2001.
DiIulio Jr., John J. Know Us by Our Works. Wall Street Journal, 14 February 2001, 237 (32):A22.
Hansmann, Henry.  1996.  The Ownership of Enterprise.  Cambridge, MA: The Belknap Press of Harvard University Press.
Jensen, Laura. Interview by author. Indianapolis, IN, May 2001.
Kennedy, Sheila S. 2001. Privatization and Prayer: The Case of Charitable Choice. (Currently under review.)
Krashinsky, Michael.  1998.  Does Auspice Matter? The Case of Day Care for Children in Canada.  In Private Action and the Public Good, edited by Walter W. Powell and Elizabeth Clemens, 114-123. New Haven, CT: Yale University Press.
Lenkowsky, Leslie. 2001. Funding the Faithful: Why Bush is Right. Commentary 111 (6). Available from: Accessed August 1, 2001.
Mauser, Elizabeth.  1998.  The Importance of Organizational Form: Parent Perceptions versus Reality in the Day Care Industry.  In Private Action and the Public Good, edited by Walter W. Powell and Elizabeth Clemens, 124-136.  New Haven, CT: Yale University Press.

Minow, Martha. 1999. Choice or Commonality: Welfare and Schooling After the End of Welfare as We Knew it. Duke Law Journal 49: 493.

Monsma, Stephen V. 1996. When Sacred and Secular Mix: Religious Nonprofit Organizations and Public Money. Lanham, MD: Rowman and Littlefield Publishers.
Raibley, Matt. Interview by author. Indianapolis, IN, July 2001.
Schlesinger, Mark.  1998.  Mismeasuring the Consequences of Ownership: External Influences and the Comparative Performance of Public, For-Profit, and Private Nonprofit Organizations.  In Private Action and the Public Good, edited by Walter W. Powell and Elizabeth Clemens, 85-113.  New Haven, CT: Yale University Press.

Stone, Hager,  & Griffin, . (2001). 

Task Force on Sectarian Social Services and Public Funding. 1990. New York: The American Jewish Committee.
U.S. Senate Judiciary Committee.  Faith Based Solutions: What are the Legal Issues? Hearing before the Judiciary Committee.  107th Cong., 1st sess., 6 June 2001. 
Weisbrod, Burton.  1998. Institutional Form and Organizational Behavior.  In Private Action and the Public Good, edited by Walter W. Powell and Elizabeth Clemens, 69-84. New Haven, CT: Yale University Press.
Wineburg, Robert J. 1992. Local Human Services Provision by Religious Congregations: A Community Analysis. Nonprofit and Voluntary Sector Quarterly 21 (2): 107-118.
Winston, Diane. 2001. Losing Their Religion? Available from: Accessed August 1, 2001.



[1] Section 104 of The Personal Responsibility and Work Opportunity Reconciliation Act of 1996, H.R 3734, 104th Congress, 2d Session, P.L. 104-193.

[2] Prior to the mid-1960’s a “public system provided basic human services to the needy, and a small private system supported by philanthropic donations delivered services to more specialized populations.” The majority of human services are now provided by nonprofits for whom government funds have become the principal source of revenue. (Salamon 1995; Stone, Hager, and Griffin 2001).

[3] In testimony to the Senate Judiciary Committee on Faith Based Solutions, Rev. Eliezer Valentín Castañón presented the position of the General Board of Church and Society of the United Methodist Church, saying “We cannot agree, however, in the establishment of faith as a separate category that sets religious groups apart from requirements which others are obligated to meet in order to provide social services.” (U.S. Senate Judiciary Committee 2001).

[4] American Jewish Congress v. Bernick, Bolden, and Sakomoto, Superior Court, State of California, County of San Francisco (June 2001).

[5] It is instructive that this issue has been raised with the authors on several occasions, but always “off the record.” It is a persistent background concern that no one wants to acknowledge publicly.

[6] Available from

[7] As Douglas Laycock noted in his testimony, “We have not succeeded in guaranteeing even one provider for all people who need these services. How can we plausibly guarantee a choice of providers?” (U.S. Senate Judiciary Committee 2001)