§ 205.1 - Grants and cooperative agreements.

§ 205.1 Grants and cooperative agreements.

Cross Reference

Link to an amendment published at 89 FR 15709, Mar. 4, 2024.

(a(a) As used in this section, the term “award” has the definition in 2 CFR 700.1 and the term “Federal financial assistance” has the definition in Executive Order 13279 (signed by President Bush on December 12, 2002). As used in this section, the following terms have the definitions in 2 CFR 200.1: “pass-through entity,” “recipient,” “subaward,” and “subrecipient” as modified by 2 CFR 700.3 to apply to both nonprofit and for-profit entities.

(b) Faith-based organizations are eligible

,

on the same basis as any other organization

and considering any reasonable accommodation, as is consistent with Federal law, the Attorney General's Memorandum of October 6, 2018 (Federal Law Protections for Religious Liberty), and the Religion Clauses of the First Amendment to the

to receive any U.S.

Constitution, to participate in any USAID program

Agency for International Development (USAID) award for which they are otherwise eligible. In the selection of

service-providers

recipients by USAID and subrecipients by pass-through entities, neither USAID nor

entities that make and administer sub-awards of USAID funds

pass-through entities shall discriminate for, or against, an organization on the basis of the organization's religious character, motives, or affiliation, or

exercise. For purposes of this part, to discriminate against an organization

lack thereof, or on the basis of

the organization's religious exercise means to disfavor an organization, including by failing to select an organization, disqualifying an organization, or imposing any condition or selection criterion that otherwise disfavors or penalizes an organization in the selection process or has such an effect: (1) Because of

conduct that would not be considered grounds to favor or disfavor a similarly situated secular organization

; (2) Because of conduct that must or could be granted an appropriate accommodation in a manner consistent with RFRA (42 U

.

S.C. 2000bb through 2000bb-4) or the Religion Clauses of the First Amendment to the Constitution; or

(3) Because of the actual or suspected religious motivation of the organization's religious exercise.

(4)

Notices or announcements of award opportunities shall include language to indicate that faith-based organizations are eligible on the same basis as any other organization and subject to the protections and requirements of Federal law.

As used in this section, the term “program” refers to federally funded USAID grants and cooperative agreements, including subgrants and sub-agreements. The term also includes grants awarded under contracts. As used in this section, the term “grantee” includes a recipient of a grant or a signatory to a cooperative agreement, as well as sub-recipients of USAID assistance under grants, cooperative agreements, and contracts. (b) Organizations that receive direct

(c) Nothing in this part shall be construed to preclude USAID from making an accommodation, including for religious exercise, with respect to one or more award requirements on a case-by-case basis in accordance with the Constitution and laws of the United States.

(d) USAID shall not disqualify an organization from participating in any USAID award for which it is eligible on the basis of the organization's indication that it may request an accommodation with respect to one or more award requirements, unless the organization has made clear that the accommodation is necessary to its participation and USAID has determined that it would deny the accommodation.

(e) Organizations that receive direct Federal financial assistance from USAID under any USAID

program (including through a prime

award or

sub-award)

subaward may not engage in explicitly religious activities (including activities that involve overt religious content such as worship, religious instruction, or proselytization)

,

as part of the programs or services directly funded with direct Federal financial assistance from USAID. If an organization conducts such activities, the activities must be offered separately, in time or location, from the programs or services funded with direct Federal financial assistance from USAID, and participation must be voluntary for beneficiaries of the programs or services funded with such assistance. Nothing in this part restricts USAID's authority under applicable

federal

Federal law to fund activities, such as the provision of chaplaincy services, that can be directly funded by the Government consistent with the Establishment Clause.

(

c

f) A faith-based organization that applies for, or participates in, USAID-funded

programs or services (including through a prime award or sub-award)

awards or subawards will retain its autonomy, religious character, and independence, and may continue to carry out its mission consistent with religious freedom protections in Federal law, including the definition, development, practice, and expression of its religious beliefs, provided that it does not use direct Federal financial assistance from USAID

(including through a prime award or sub-award)

to support or engage in any explicitly religious activities (including activities that involve overt religious content such as worship, religious instruction, or proselytization), or in any other manner prohibited by law. Among other things, a faith-based organization that receives Federal financial assistance from USAID may use space in its facilities, without concealing, altering, or removing religious art, icons, scriptures, or other religious symbols. In addition, a faith-based organization that receives Federal financial assistance from USAID retains its authority over its internal governance, and it may retain religious terms in its organization's name, select its board members on a religious basis, and include religious references in its organization's mission

statements

statement and other governing documents.

(

d

g) USAID must implement its

programs

awards in accordance with the Establishment Clause. Nothing in this part shall be construed as authorizing the use of USAID funds for activities that are not permitted by Establishment Clause jurisprudence or otherwise by law. USAID will consult with the U.S. Department of Justice if, in implementing a specific program involving overseas acquisition, rehabilitation, or construction of structures used for explicitly religious activities, there is any question about whether such funding is consistent with the Establishment Clause. USAID will describe any program implemented after such consultation on its

Web site

website.

(

e

h) An organization that

participates in programs funded by financial assistance from USAID (including through a prime award or sub-award)

receives a USAID-funded award or subaward shall not, in providing services or outreach activities related to such services, discriminate against a program beneficiary or potential program beneficiary on the basis of religion

or

, a religious belief, a refusal to hold a religious belief, or a refusal to attend or participate in a religious practice.

(

f

i) No grant document, contract, agreement, covenant, memorandum of understanding, policy, or regulation used by USAID shall require faith-based organizations to provide assurances or notices where the Agency does not require them of

non-faith-based

secular organizations. Any restrictions on the use of

grant

award or subaward funds shall apply equally to faith-based and

non-faith-based

secular organizations. All organizations that

participate in USAID's programs (including through a prime award or sub-award)

receive USAID awards and subawards, including faith-based

ones

organizations, must carry out eligible activities in accordance with all

program

award requirements and other applicable requirements that govern the conduct of USAID-funded activities, including those that prohibit the use of direct Federal financial assistance from USAID to engage in explicitly religious activities. No grant document, contract, agreement, covenant, memorandum of understanding, policy, or regulation used by USAID shall disqualify faith-based organizations from

participating in USAID's programs because such organizations are motivated or influenced by religious faith to provide social services or other assistance, or because of their religious character or affiliation, or on grounds that discriminate against organizations on the basis of the organizations' religious exercise, as defined in this part. (g

receiving USAID awards on the basis of the organization's religious character, motives, or affiliation, or lack thereof.

(j) A religious organization does not forfeit its exemption from the Federal prohibition on employment discrimination on the basis of religion, set forth in section 702(a) of the Civil Rights Act of 1964, 42 U.S.C. 2000e-1, when the organization receives Federal financial assistance from USAID.

An organization that qualifies for such exemption may select its employees on the basis of their acceptance of, and/or adherence to, the religious tenets of the organization. (h) Many USAID grant programs require

(k) If a USAID award requires an organization to be a “nonprofit organization” in order to be eligible for funding

. Individual solicitations that require organizations to have nonprofit status

, the individual solicitation will specifically

so

indicate the requirement for nonprofit status in the eligibility section of

a

the solicitation.

Grantees

Potential applicants should consult with the appropriate USAID program office to determine the scope of any applicable requirements. In USAID

programs

awards in which an applicant must show that it is a nonprofit organization, other than programs which are limited to registered Private and Voluntary Organizations, the applicant may do so by any of the following means:

(1) Proof that the Internal Revenue Service currently recognizes the applicant as an organization to which contributions are tax deductible under section 501(c)(3) of the Internal Revenue Code;

(2) A statement from a state taxing body or the

state

State secretary of state certifying that:

(i) The organization is a nonprofit organization operating within the State; and

(ii) No part of its net earnings may lawfully benefit any private shareholder or individual;

(3) A certified copy of the applicant's certificate of incorporation or similar document that clearly establishes the nonprofit status of the applicant; or

(4) Any item described in paragraphs (

b

k)(1) through (3) of this section if that item applies to a

state

State or national parent organization, together with a statement by the State or national parent organization that the applicant is a local nonprofit affiliate.

(

i

l) Decisions about awards of USAID Federal financial assistance must be free from political interference, or even the appearance of such interference, and must be made on the basis of merit, not on the basis of

the religious affiliation of a recipient organization

religion or religious belief, or lack thereof.

(

j

m) Nothing in this part shall be construed as authorizing the use of USAID funds for the acquisition, construction, or rehabilitation of religious structures inside the United States.

(

k

n) The Secretary of State may waive the requirements of this section in whole or in part, on a case-by-case basis, where the Secretary determines that such waiver is necessary to further the national security or foreign policy interests of the United States.

(

l

o) Nothing in this section shall be construed in such a way as to advantage, or disadvantage, faith-based organizations affiliated with historic or well-established religions or sects in comparison with other religions or sects.

[69 89 FR 6172315709, Oct. 20, 2004, as amended at 81 FR 19415, Apr. 4, 2016; 81 FR 42248, June 29, 2016; 85 FR 82134, Dec. 17, 2020Mar. 4 2024]