Executive Summary

The landmark 1996 federal welfare reform law establishes new rules for collaboration between government and the faith community in serving the poor. Called "Charitable Choice," these rules prohibit public officials from discriminating against religious social service providers seeking to compete for government contracts. They protect the religious integrity and character of faith-based organizations (FBOs) that accept government dollars by granting them important rights: to retain authority over their mission and governing board; to maintain a religious atmosphere in their facilities; and to select only staff who agree with their religious beliefs. They prohibit FBOs from using government funds for purposes of sectarian worship, instruction, or proselytization and ensure that service beneficiaries uncomfortable receiving aid from religious providers will be able to obtain help from alternative organizations. Charitable Choice creates a level playing field between secular and religious service providers competing for public funding, and, it is hoped, will facilitate increased government-faith collaboration without compromising the religious character of the service providers or abridging the civil liberties of clients.

Based on research in nine states completed in summer 1999, Charitable Choice is accomplishing these aims. Charitable Choice has made church-state collaboration plausible to public officials and religious leaders. Religious groups accepting government funding are not having to sell their souls, and clients' civil rights are being respected. Charitable Choice is also stimulating new collaborations. Over half of the FBOs currently working formally with government in new initiatives to serve the poor had no previous history of such relationships. The traditional social services network is being broadened with the inclusion of "new players," and, importantly, these new players are doing new things. That is, in their collaboration with government, churches and FBOs are offering low-income citizens services they had not previously offered. In most instances, these religious groups have shifted from merely providing commodities to the poor (e.g., used clothing or free groceries) to working with struggling individuals intensively, face-to-face, through mentoring and job training programs. The nine states surveyed for this study include: California, Illinois, Massachusetts, Michigan, Mississippi, New York, Texas, Virginia and Wisconsin.

Charitable Choice's impact has been modest, though notable. Strictly speaking, Charitable Choice applies only to financial relationships between government and social service pro

viders. Research in the nine states reveals 84 new financial collaboratives since 1996. Yet many in government and the faith community use "Charitable Choice" in a broader sense, to denote all new forms of government-faith community collaborations under welfare reform. A total of 41 new non-financial relationships were identified in the nine states. Most of these initiatives began within the last year and a half. Although a grand total of 125 new financial and nonfinancial collaborations in nine states appears a small number, it reflects a significant amount of activity, involving hundreds of congregations and FBOs and thousands of welfare recipients. The new contracts with FBOs range from $5,000 to over $350,000.

While survey interviews indicated considerable enthusiasm among government and faith representatives for these new collaborations, interviews also revealed that few people in either community are well-educated about the specifics of Charitable Choice. Charitable Choice's detailed guidelines are being codified into formal contracts only in Texas and Wisconsin. In all states, much remains to be done to bring government administrative procedures and procurement policies into sync with the letter and spirit of Charitable Choice.