Statement of Samantha Smoot, Executive Director,
Texas Freedom Network Education Fund, Austin, Texas

Testimony Before the Subcommittee on Human Resources and
Subcommittee on Select Revenue Measures
of the House Committee on Ways and Means

Hearing on H.R. 7, the "Community Solutions Act of 2001"

June 14, 2001

After the Welfare Reform Act of 1996, and under the leadership of Governor George W. Bush, Texas launched an aggressive campaign to implement 'charitable choice'.

The Texas model of 'charitable choice' took a two-pronged approach - diverting public funds to religious social service programs while simultaneously loosening regulations over these faith-based providers.

Now, as the national initiative unfolds in much the same way as its Texas predecessor, the state's five-year record offers insight into some of the difficulties in the application of the proposed faith-based initiative.

'Charitable choice' has proven to be a thorny proposition to implement. Problems with the faith-based initiative in Texas have ranged widely from the inherent difficulties that come with co-mingling government and church funds, to dangers incurred by relaxing basic health and safety standards, to problems posed by preferential treatment of applicants promoting specific belief systems.

Lack of Accountability

In Texas, we have seen a gross lack of standardized accounting procedures with 'charitable choice' monies. 'Charitable choice' grants are distributed directly to faith-based programs by state agencies, by those agencies' regional and local arms, and oftentimes, faith-based organization reissue funds to additional faith-based programs.

It has been widely reported that the two state agencies distributing funds to faith-based organizations have spent $10 million to date. However, the Texas Freedom Network Education Fund has identified an additional $3.5 million in grants to faith-based programs made through local government entities. Compiling data of faith-based or community-based programs that receive funding under 'charitable choice' initiatives has been very ineffective, as the state does not track the amount of 'charitable choice' funds granted. Furthermore, since the state does not differentiate between religiously-affiliated institutions that proselytize the people they are serving and those that do not, it is impossible to say how many proselytizing 'faith-based' program have been funded.

Lack of Demand

One of the difficulties in implementing 'charitable choice' has been wholly unexpected: neither proponents nor adversaries of the 'charitable choice' program would have predicted five years ago the surprising lack of interest in the program. Texas affords us a fine opportunity to examine this phenomenon, since the implementation of 'charitable choice' there was high profile and aggressive.

State records document 2369 faith-based organizations as participants in the Texas 'charitable choice' program. But the vast majority of these faith-based programs--at least 2000-- are categorized as 'informal' contracts, meaning that they receive no public funds. Of those that are funded, most--such as Catholic Charities, the Salvation Army, and Lutheran Social Services--are religiously-affiliated programs that were already receiving government funds prior to establishment of the 'charitable choice' program.

In the 'charitable choice' program's efforts to lessen regulations on faith-based providers, the same lack of interest holds. There are 2008 faith-based child care and child placing facilities licensed by the state, compared to a paltry 8 who have elected to pursue the 'charitable choice' Alternative Accreditation option. After five years of aggressive outreach to the religious community, the only applicants represent a small constituency of groups that were unable to partner with the government by establishing a separate, not-for-profit entity and exercise prudent separation and standards.

Co-mingling of funds

Direct grants to these few religious groups have resulted in a lack of accountability over taxpayer funds and a violation of the Constitutional separation between church and state. In Texas, it has become apparent that there is simply no way to ensure that taxpayer funds are not co-mingled with church funds or spent on overtly religious activities.

The Jobs Partnership of Washington County won a state contract through 'charitable choice', receiving $8,000 of its $20,000 annual budget from the Texas Department of Human Services (DHS). The program's budget and curriculum show that Jobs Partnership of Washington County used state money to buy Bibles, and that the program focused a great deal of its efforts on Bible study. In fact, religion--specifically Christianity--permeated nearly every aspect of this program which is belied by the stated mission of the program to help clients "find employment through a relationship with Jesus Christ". Instructors readily acknowledged that they were trying to change students' beliefs and put Jesus at the center of their lives. They say that the religious and moral aspects of the curriculum were crucial in helping program participants change themselves from the inside out.

The religious message seemed to have a coercive impact on clients. About one-third of the participants said in the program evaluation that they felt pressure to join the host church, Grace Fellowship Baptist Church. Moreover, the only other job-training program in the area was located miles away in the next county, making it an implausible alternative for many of the low-income clients. Thus, for many area people looking for a job training program, their only viable option was the Jobs Partnership of Washington County.

Currently there is a lawsuit against the Jobs Partnership of Washington County and the Department of Human Services on appeal in the 5^th circuit court of appeals. The outcome of the suit is of particular importance as DHS continues to fund faith-based programs, and as Jobs Partnership of Washington County has shown, it is incredibly difficult for programs to separate out the religious aspects of a program from the non-religious.

Preferential Treatment

Another difficulty in implementing 'charitable choice' is the subjective nature of the bidding process, which opens the door for inefficient and discriminatory practices by the state agencies and administrators distributing public funds. In another example of how 'charitable choice' has not been administered in a cost-effective or fair manner in Texas, there is evidence that preferential treatment has been given to religious providers in contracting opportunities with the state.

In response to a Texas Workforce Commission contract opportunity for fatherhood responsibility and employment initiatives, two nationally recognized groups - the Institute for Responsible Fatherhood (IRF) and Lockheed Martin (in conjunction with the Ray Marshall Center of the University of Texas at Austin) - submitted proposals.

The past track records and proposal costs for these two groups differed greatly. The Lockheed/ Ray Marshall group, combined, had placed over 125,000 individuals in jobs and currently has contracts with the State of Texas to provide services to 13 local workforce development boards. On the other hand, the Institute for Responsible Fatherhood had placed just 436 individuals, at a cost of $4.4 million. Additionally, Lockheed Martin had been working with state agencies since 1963, while the Institute for Responsible Fatherhood had only been working with state agencies since 1988 and a pilot project in Corpus Christi constituted the whole of their experience in Texas.

In the two-year period immediately preceding the proposal submissions, the Institute for Responsible Fatherhood served a total of 676 people. During that same period of time, just one of Lockheed Martin's 43 national programs served over 10,000 TANF recipients. Moreover, the program directors for the two proposed programs differed greatly in their experiences - the Lockheed Martin director had 20 years experience directing and managing social service programs, at many different levels, while the IRF's program directors had little experience in social service programs, one director's overwhelming resume experience was 12 years in property rental management.

For this grant request, the Institute for Responsible Fatherhood submitted a proposal for the maximum amount allowed for this particular bid - $1.5 million - and the Lockheed Martin group set forth a $930,000 proposal. The Institute for Responsible Fatherhood was awarded the Texas Work Force Commission grant.

The significant differences in measurable factors seemed to have been outweighed by subjective criteria that played into the evaluation of these two organizations. The Institute for Responsible Fatherhood grant proposal clearly indicated a faith-based teaching structure. The program mission and implementation steps described lay the groundwork for a prescribed spiritual path. On the other hand, the Lockheed Martin proposal presents a work program that speaks directly to job training and placement by practical application, without set spiritual elements.

The application of a spiritual philosophy on program participants appears to have played a greater role in determining the outcome of the grant decision than did the actual budget proposal or the experiences of the organizations. In this instance, the playing field was not level. Instead, the implementation of a faith-based philosophy outweighed the organizations track record, experience and cost effectiveness.

Relaxing Regulations

There has been much talk recently about removing 'unnecessary barriers' which prevent religious institutions from serving those in need. In the name of 'leveling the playing field' for faith-based programs, Texas passed laws relaxing regulations over faith-based programs. There is no question that eliminating basic health and safety safeguards made operations easier for a few faith-based programs. Unfortunately, this aspect of 'charitable choice' has also jeopardized the well-being of the people being served by these facilities.

Deregulation of faith-based service providers is essential to the concept of 'charitable choice', which strives to divert the flow of government funds to religious groups without forcing them to adhere to the government regulations they would otherwise be required to follow. While lessening regulations for faith-based programs is one of the most critical aspects of 'charitable choice', it is also the aspect that has received the least attention.

One rationale for removing health and safety regulations from these faith-based providers was that these groups seemed to be so effective. Nationally known drug treatment program, Teen Challenge, has encouraged this notion by claiming success rates ranging from seventy to eighty-six percent. But these figures dramatically distort the truth, as they represent the successful treatment rate of only those participants who do not drop out of the program before completion, which includes less than one-fifth (18%) of the total number of students who actually participated.

Another rationale for loosening regulations over faith-based programs has been what 'charitable choice' supporters call the "faith factor" - the expressly religious component that is the power behind these religious programs and - supporters believe - should not be hampered by government red-tape. In Texas, many of the faith-based service providers taking advantage of 'charitable choice' went a step further, expressing contempt and hostility towards basic health and safety laws. The architect of 'charitable choice', Marvin Olasky, articulated this hostility, held by the fringe element of religious social service providers, when he commented this Spring that faith-based drug treatment counselors "should not be forced to undergo 170 hours of training in a religion that is not their own."

Teen Challenge is a faith-based residential drug treatment program with three branches in Texas and more than 150 sites across the country - all of which rely solely on faith-based methods to treat drug abuse. The treatment program, which has no medical component, centers instead around prayer, Bible study, and religious conversion.

In 1995, the Texas Commission on Alcohol and Drug Abuse (TCADA) found the San Antonio branch of Teen Challenge in violation of state procedures, health and safety regulations and licensure standards. Program counselors did not meet training requirements and Teen Challenge disregarded state law by releasing confidential treatment records. Due to these infractions, Teen Challenge had their license suspended by the state in June of 1995. In response, then-Governor George W. Bush intervened on Teen Challenge's behalf and pushed through legislation to exempt religious-based drug treatment centers from state licensing and regulation.

Under Texas' new, permissive regulatory structure, faith-based drug treatment centers must simply register their religious status with the state to be exempt from virtually all health and safety measures required of the vast majority of treatment facilities, including: state licensing, employee training requirements, abuse and neglect prevention training, licensed personnel requirements, provisions protecting clients' rights, and reporting requirements of abuse, neglect, emergencies or medication errors.

To date, 102 faith-based drug treatment facilities have registered with the state under this system and their impact may have dangerous consequences in Texas.

Protecting Religious Autonomy Through Alternative Accreditation

Another alarming example of the dangerous consequences of 'charitable choice' is exemplified through the dramatic story of the Roloff Homes.

For three decades, the Roloff Homes - a group of faith-based homes for troubled teens in Corpus Christi, Texas - have been the subject of high-profile allegations of physical abuse and neglect. After the U.S. Supreme Court ruled that they must accept state licensing and regulation, the Roloff Homes closed down and moved to Missouri rather than accept state oversight in Texas.

In 1997, Roloff attorneys were the only witnesses to testify in favor of legislation to establish an alternative, private accreditation process in lieu of state licensing for religious childcare facilities. The first facility to apply for and receive accreditation from the Texas Association of Christian Child Care Agencies (TACCCA) was the Roloff Homes. In April 2000, serious allegations of abuse surfaced once again at the homes. Yet, within weeks of resulting arrests, TACCCA re-accredited the Roloff Homes.

In theory, Texas' Alternative Accreditation program for faith-based providers of childcare and child placement services was supposed to enforce the same standards as the state of Texas. In reality, the state is unable to force TACCCA to exercise proper oversight. Unless formal allegations of abuse and neglect are filed by TACCCA against a facility it accredits, the state has no authority to do site visits of alternatively-accredited facilities

The rate of confirmed cases of abuse and neglect at alternatively accredited facilities in Texas is more than 10 times that of state-licensed facilities. TACCCA's own documentation shows that they have not conducted proper oversight of the facilities they accredit. Moreover, TACCCA was remiss in its oversight role because it never conducted an unannounced inspection of its facilities, as required by state law.

As a buffer between faith-based organizations and the state, Alternative Accreditation protected the faith-based organizations from oversight, but left the children in their care vulnerable.

Conclusion

'Charitable choice' was conceived of by one Texan, Marvin Olasky, and aggressively implemented by another, Gov. George W. Bush. After five years of aggressively implementing government-funded faith-based programs in Texas, positive results have proven to be impossible to document or measure. Evidence points instead to a system that is unmanageable, unregulated, prone to favoritism and co-mingling of funds, and even dangerous to the very people it is supposed to serve. Sadly, Texas' efforts to fund religious activity have proven to be a treacherous enterprise for churches, taxpayers, and people in need alike.

So treacherous, in fact, that even the very legislators who once promoted 'charitable choice' in Texas have now abandoned the idea, choosing not to renew the 'Alternative Accreditation' plan this year. In the state that has moved the farthest along in the faith-based initiative experiment, Texas' move to shut down one of the lynchpins of 'charitable choice' signifies a dramatic rollback of this initiative.

Supporters of "charitable choice" point to Texas as a role model for the nation - and I agree with them. I urge you to consider Texas' record of difficulties in implementation and lack of demand for this program before moving forward. After five years of aggressive implementation in Texas, taxpayers have virtually no accountability over how their funds are spent, people in need have no guarantee that they will be delivered services that do not jeopardize their health and safety or violate their freedom of religion. The state lawmakers on the front lines of this program, having witnessed its troubled record, have begun to reverse the state's involvement in charitable choice.