HUD Issues Rule Extending Religious Liberty Protections to Beneficiaries of HUD Programs and Activities

HUD recently published a final rule that provides new religious liberty protections for beneficiaries of its programs and activities. In addition, HUD’s new rule ensures that faith-based providers can compete for government funds on the same basis as any other private organization.

According to HUD Secretary Julián Castro, “These new regulations strengthen religious liberty protections for beneficiaries across HUD programs and help eligible faith-based applicants to compete for HUD funding on an equal footing. As HUD seeks to help build ladders of opportunity for all Americans, these new protections benefit both grantees and beneficiaries.”

HUD’s final regulations:

• Require that all decisions about awards of federal financial assistance are based solely on merit, without regard to an organization’s religious character or affiliation or lack thereof, and are free from political interference, or the appearance of such interference.
• Make clear that faith-based organizations are eligible to participate in HUD programs and activities on the same basis as any other organization.
• Clarify what activities can and cannot be supported with direct federal financial assistance by replacing use of the term “inherently religious activities” with the term “explicitly religious activities” and providing examples of such activities.
• Prohibit organizations that receive federal financial assistance under a HUD program or activity from discriminating against beneficiaries or prospective beneficiaries on the basis of religion, a religious belief, a refusal to hold a religious belief, or a refusal to attend or participate in a religious practice, in providing services or carrying out activities with such assistance.
• Require faith-based organizations that carry out programs or activities with direct federal financial assistance from HUD to provide written notice of certain protections to beneficiaries and prospective beneficiaries of the programs or activities. Specifically, an organization that receives direct federal financial assistance is required to give notice to beneficiaries and prospective beneficiaries that:

• The organization may not discriminate against a beneficiary or prospective beneficiary based on religion, a religious belief, a refusal to hold a religious belief, or a refusal to attend or participate in a religious practice;
• The organization may not require a beneficiary to attend or participate in any explicitly religious activities that are offered by the organization, and any participation by the beneficiaries in those activities must be purely voluntary;
• The organization must separate in time or location any privately funded explicitly religious activities from activities supported by direct federal financial assistance;
• If a beneficiary or prospective beneficiary objects to the religious character of the organization, the organization will undertake reasonable efforts to identify and refer the beneficiary to an alternative provider to which the beneficiary has no such objection; and
• A beneficiary or prospective beneficiary may report violations of these protections, including any denials of services or benefits, to the federal agency or intermediary administering the program.