Warning to states on funding faith-based charities

As George W. Bush heads into year two of his presidency, one question mark is whether "compassionate conservatism" - a cornerstone of his campaign and early months in office - will hold its own against the war on terrorism and the bid for economic recovery.

The centerpiece of compassionate conservatism is the "faith-based initiative" for social services. Mr. Bush wanted to engage religious groups more fully in solving social problems - and to do so by allowing them to receive federal funds without having to create a separate entity

for that purpose to satisfy the demands of separation of church and state. This "charitable choice" feature first appeared in the 1996 Welfare Reform Act, but Bush would extend it across a range of federal programs.

Despite his vigorous use of the bully pulpit, the initiative went nowhere in 2001. Americans applauded the concept, but tripped over the details. A brouhaha erupted over the potential for tax dollars to support religious teaching, or

for the government to intrude on religious institutions. Critics also worried that some faiths would be favored, and that there would be discrimination in hiring if groups could choose just those of their own faith. A bill passed the House but proposals stalled in the Senate.

Now, as the White House and Congress draw up plans for 2002, a federal court has issued a decision challenging the constitutionality of public funding of programs that have a religious aspect.

Last week, a federal judge in Wisconsin ruled that giving direct state funding to Faith Works, a drug- and alcohol-addiction program that relies on Christian teaching, amounted to government support for religious indoctrination. Faith Works, which Bush visited and lauded, has received close to $1 million from the state, mostly under the governorship of Tommy Thompson, who is now US secretary of health and human services.

"This is the sort of 'ideal program' that's been touted by the White House," says Marc Stern, a lawyer for American Jewish Congress who is working on other similar cases. "So the decision is very significant." Barry Lynn, head of Americans United for Separation of Church and State, calls it "a major blow to the president's faith-based initiative."

The case deals with state funding decisions, so the judge did not rule on the constitutionality of the federal charitable-choice legislation.

Stephen Lazarus of the Center for Public Justice, a Christian group that helped design the initiative, insists the case "by no means slams the door" on charitable choice. "But it's a warning to states that they have to carefully implement the guidelines," which say funds can't be used for religious instruction.

Still, he and some other advocates are pushing for a new constitutional standard that differs from separation of church and state - one that says religious groups should be able to get monies on a "level playing field" with secular groups, without concern for their religious character.

At the end of 2001,a compromise was cobbled together in the Senate by Senators Rick Santorum (R) of Pennsylvania and Joseph Lieberman (D) of Connecticut which set aside the expansion of charitable choice and focused on tax incentives to encourage charitable giving. It never got to a vote, however.

"Now we are waiting to hear from the White House on whether we pick up where we left off and try to move quickly, or whether they want to go back to try to negotiate a comprehensive plan including charitable choice," says Dan Gerstein, Lieberman's communications director.

Signs are the president will stick with the tax incentives bill - at least for starters. "We will continue to focus on the compromise legislation .. .on the nondivisive areas where there is common ground," says Ann Womack, of the White House press office.

Meanwhile, religious and civil rights groups this week sent Bush a report on some areas of agreement, but they did not find common ground on the major issues of direct grants and hiring discrimination. The Welfare Reform Act comes up for renewal this year, and people on both sides expect it will become a vehicle for debate on charitable choice.

Those who challenge its constitutionality expect to be busy: "Church-state lawyers will be in litigation for a long time," Mr. Stern says.