Faith-Based Social Service Provision Under Charitable Choice:
A Study of Implementation in Three States

Background of the Issues
Among the more controversial elements of welfare reform was inclusion of the Charitable Choice provision. Charitable Choice, or Section 104 of the Personal Responsibility and Work Opportunity Reconciliation Act of 1996 (PRWORA), encourages states to contract with Faith-Based Organizations (FBOs) for delivery of social services to welfare recipients on the same basis as they contract with traditional, secular providers.

Charitable Choice as conceived in 1996 allows faith-based service providers to use religious criteria when hiring staff, maintain religious symbols in areas where programs are administered, and use faith-based concepts in providing services. Clients have a right to an alternative secular provider and may not be forced to participate in religious observances or services. Public funds may not be used for sectarian activities, such as worship, instruction or proselytization. While significant funds historically have gone to social service providers affiliated with, and informed by, the religious precepts of FBOs, and while government funds have followed individual hospital patients and nursing home residents to religious facilities, Charitable Choice initiatives encourage governments to partner directly with sectarian organizations-including those considered "pervasively sectarian"-to provide an array of social services.

Inclusion of Charitable Choice in welfare reform was premised on several assumptions

• FBOs do a better job at a lower cost than traditional providers
• FBOs represent significant untapped resources that can be marshaled to help the needy
• FBOs had previously encountered barriers to participation

The data to support these assumptions are sketchy at best and with respect to comparative efficacy, there is simply no comprehensive research addressing these issues.

This project, made possible with support from the Ford Foundation, with the preliminary assistance of the Indiana Family and Social Services Administration, the Joyce Foundation, and the Indiana University Center on Philanthropy, is an attempt to generate data and provide a baseline for further study. While the research is limited to human services delivery for purposes of TANF (Temporary Assistance to Needy Families), results may inform efforts to implement President Bush's Faith-Based Initiative through the White House Office of Faith-Based and Community Initiatives.

Principal Investigator
Sheila Suess Kennedy is the study's principal investigator. She is an Assistant Professor of Law and Public Policy at the School of Public and Environmental Affairs, IUPUI. (For more information about the research team please go to the Project Staff page.)

The Center for Urban Policy and the Environment (Center), a research center associated with the School of Public and Environmental Affairs at Indiana University-Purdue University Indianapolis (IUPUI), is conducting the study. The Center uses analytic and decision facilitation competencies to inform policy choices about complex societal problems, especially in Central Indiana. The Center is non-partisan and non-ideological and works on a broad range of policy issues.

Issues Addressed
The project is an evaluation of program implementation over the course of three years in three states-Indiana, Massachusetts, and North Carolina-chosen because they represent different political cultures and religious landscapes. These three states also are at different stages of, and have taken different approaches to, implementation.

Specific research goals include:

• Investigation and analysis of how states choose to work with FBOs.
• Comparison of the relative successes and costs of services provided by FBOs and traditional social service providers:
  • Evaluation of efficacy and cost of FBOs compared with traditional, secular providers;
  • Measurement of outcomes, including whether clients who participate in FBOs programs hold jobs longer, make more money, and/or stay off public assistance longer;
  • Analysis of the variables that might account for discrepancies in performance, if such discrepancies are found, looking at differences in state implementation strategies, client population, and similar factors which might be expected to affect performance.
    
• Capacity of FBOs to bid for and manage contracts and states to monitor the identified services.
• Examination of how states define and measure the capacity of individual FBOs; i.e., minimal requirements for staff; legal, accounting and informational resources; and ability to absorb the transaction costs associated with government contracting. We also will report on efforts by the states to develop and enhance the institutional capacity of small FBOs. Finally, we will report whether the states themselves have the capacity to initiate and sustain appropriate management of these contracts.
• Documentation, analysis, and comparison of requirements imposed by each State to ensure accountability. The project will examine procedures established for awarding contracts and monitoring performance, paying particular attention to the characteristics of successful and unsuccessful bidders, methods used to ensure compliance with the requirements of the law, numbers of clients served by FBOs before and after receipt of government funding, and reporting methods.
• Constitutional and fiscal accountability of both organizations and state agencies for resources, outcomes, and processes adherence to First Amendment boundaries between church and state.
• Effects of government contracts on organizational behavior, including fiscal and other burdens as a result of government reporting requirements, and dependency on public funding.

These issues are being investigated from various perspectives: that of the consumer/client, the provider organizations (faith- and non-faith-based), and the state. Given that the Charitable Choice provision did not define "faith-based" organizations and because so many religious providers have a long history of collaboration/contractual relations with government, one of the first challenges of the study is determining how to define faith-based for purposes of program implementation and analysis.

Charitable Choice in Three States
The project will produce a descriptive history of faith-based, publicly funded welfare programs, documenting the evolution of faith-based/public partnerships in each of the three states. These will serve as the basis for a comparative analysis that seeks to identify and describe the similarities and differences among the three states. The historical summary of the evolution of Charitable Choice programs will be founded on interviews with key public and faith-based officials and also will include the collection and summary of documents and literature that provide official descriptions of the process.

The historical summary will address the status of contractual relations between the public sector and faith-based organizations both prior to and following the adoption of Charitable Choice legislation. Questions include: How do states choose to implement the provisions? What is the process by which clients reach faith-based providers? What is the process by which they can reject such providers? What are the contracting procedures and processes? What are the criteria for awarding contracts and what monitoring mechanisms are in place? The answers to these questions will allow for comparisons among the three states and to explain, in part, similarities or differences in outcome.

Advisory Network
A panel of advisors composed of stakeholders of various constituencies affected by the legislation, scholars, and constitutional experts has been enlisted to provide advice to the research team throughout the course of the study. These members raise issues, review preliminary data, and give the research team the benefit of their particular perspectives and expertise.

Resources
National Listserv
The project hosts a listserv comprised of advisory panel members together with a growing number of other experts, scholars, and practitioners in the field. The listserv serves as a forum for discussion and dialogue, not only about the research process, but also about the subject of Charitable Choice initiatives specifically and faith-based programs in general.

If you are interested in joining the listserv, please contact us.

Literature Review
An extensive literature search has been conducted. Part of the review addresses historic and current provision of social services by faith-based entities. We have confirmed the dearth of research data on the comparative efficacy of social service provision by religious organizations. Specific research on Charitable Choice to date largely has been confined to studies indicating the willingness of congregations and other faith-based entities to participate in the new initiatives. It is apparent that this project has the potential to make a significant contribution to a relatively small body of scholarship and to provide a foundation for the further analyses that will undoubtedly be required.

Links
For a list of additional Internet sites on the subject of Charitable Choice and faith-based programs please go to the links page.

Publications
Research team working paper series

Documentary
Tempting Faith
An adjunct project of the study is production of a documentary about Charitable Choice. The documentary followed the IUPUI research team as it studied programs in three states (Indiana, Massachusetts, and North Carolina). A number of faith-based initiatives in each location are profiled, exploring what services are provided, what the local secular alternatives are, and how clients are affected by the quality and nature of the services. Religious, legal, and social service experts who are familiar with this topic and the tangle of issues it presents share their perspectives.

The documentary offers viewers a clear sense of what's at stake in this debate, and what the concerns are on both sides of the issue. The hour-long film explores the issues surrounding faith-based social services, including the politics, and the challenges facing religious organizations. The program does not take a position on whether increased reliance on faith-based social services is positive or negative; rather, it focuses upon the issues that individuals and governments must confront before making decisions.

Some of those issues include:

• Will Charitable Choice lead to more choices in social services, or fewer?
• Will clients who now rely on the government for welfare, job training, or other services be proselytized to by congregations?
• Will faith-based providers be better, worse, or the same?
• Will non-traditional religions be squeezed out of the field?
• Will government employees be forced to choose among "good" and "bad" religions?

The documentary was made possible with support from the Ford Foundation. IUPUI also supported this project, by providing research and academic support.  The documentary aired in Indianapolis in early 2003 and on Hallmark's Faith and Values network beginning in the spring of 2003. Nearly 80 PBS stations nationwide will broadcast “Tempting Faith” in the fall of 2003. It will also be distributed to educational institutions.