Bush touts faith-based answers for social services.

Competitive federal grants to faith-based charities increased for the third consecutive year during 2005, hitting $2.1 billion from seven federal agencies, according to President George W. Bush.

The president announced the revenue number and other statistics during the recent White House National Conference On Faith-Based And Community Initiatives in Washington, D.C. He pushed the theme of results-oriented grantmaking and benchmarking when it comes to receiving federal money.

While touted as an educational event, it was more of a philanthropy summit to draw attention to the role corporations and foundations play in funding organizations that provide vital services to the poor.

Addressing a ballroom of 1,200 charity executives from 43 states and the District of Columbia, the president said that federal earmarks in legislation--money targeted to specific groups or for contracts that are non-competitive--keep the grants to faith-based groups from increasing more rapidly.

The president called on donors and foundations to give to results-driven organizations that can prove results, whether they be faith-based or secular. Specific benchmarks were not suggested.

The president also signed an executive order creating The Center For Faith-Based and Community Initiatives in The Department Of Homeland Security (DHS). The center will coordinate DHS's efforts to remove regulatory, contracting, and other programmatic obstacles to the participation of faith-based and community organizations in its provision of social and community services, including disaster relief and recovery services, said White House Spokesperson Alyssa J. McClenning. The White House Office of Faith-Based and Community Initiatives is separate, but works in tandem with the Centers for Faith-Based and Community Initiatives in the 11 federal agencies with such offices, she said.

The president took the opportunity to push for tax breaks for corporations that contribute to the charitable sector and for 401(k) retirement rules to allow deductions for contributions from such plans.

"The tax code can encourage contributions.... I've got some interesting ideas to help philanthropy here in America. One of them is to allow corporate America to deduct--take larger tax deductions for food donations," said Bush. "It's kind of a specialized request. I admit it. But if one of the issues is to get food to the hungry, it makes sense to provide incentives for people who have got the wherewithal to be able to provide the resources to get the food headed toward the hungry in the first place."

A recent survey of 20 large corporate foundations by the Office of Faith-Based and Community Initiatives found that only about 6 percent of grants by those organizations went to faith-based groups. The corporate foundations were not identified.

"I would urge our corporate foundations to reach beyond the norm, to look for those social entrepreneurs who have been--haven't been recognized heretofore, to continue to fined people that are running programs that are making a significant difference in people's lives," said Bush.

In a study of 50 large foundations, "we found that one in five prohibited faith organizations from receiving funding for social service programs," said Bush, without identifying the foundations. "In other words, there's a prohibition against funding faith programs from certain foundations in the country. I would hope they would revisit their charters. I would hope they'd take a look at achieving social objectives--make the priority the achievement of certain social objectives before they would make the decision to exclude some who are achieving incredible progress on behalf of our country."

Regarding contributions from retirement accounts, Bush wants to allow senior citizens to make charitable contributions rather than pay tax on the money withdrawn.

Charitable reform legislation has been languishing in Congress for several years. Known for several years as the CARE Act, tax incentives for individuals and business have not made it into legislation unless they were revenue neutral or generated income for the federal coffers.

Bush has made it a priority to help more faith-based organizations gain access to federal money. Secular organizations have complained that many such groups are less accountable because they do not have to file federal Form 990 and are far less transparent. Bush and James Towey both emphasized that accountability is going to be key for further gains.

"America is home to millions of social entrepreneurs who feel a duty to give back to their communities. If corporate and philanthropic organizations want to make the best use of their money, they need to change the way they make charitable donations," said Towey, assistant to the president and director of the White House Office of Faith-Based and Community Initiatives. "President Bush knows religious groups have effective social service programs and--like in the federal government process--he believes they should not be discriminated against when seeking funding from corporate and foundation sources."

During Bush's first term, federal agencies promulgated 15 final rules, including general rules covering funding from seven agencies; three regulations implementing Charitable Choice statutes; a U.S. Department of Labor (DOL) regulation implementing the amendment of Executive Order 11246; and three regulations changing discriminatory language in specific HUD, Veterans Affairs, and DOL programs. Additionally, the U.S. Department of Commerce published an interim final rule in August, 2005 strengthening the department's commitment to a level playing field for faith-based and community organizations. The regulations clarify eligibility of faith-based groups to participate in federal social service programs on the same basis as any other private organization and prohibits religious discrimination by distributors of federal funds.

The White House Press Office released statistics regarding removal of what federal officials called barriers to funding. They include:

* In fiscal year 2005, more than $2.1 billion in competitive grants across seven federal agencies were awarded to faith-based organizations--nearly 11 percent of the total funding awarded through 130 programs and 28 program areas. This is an increase from fiscal year 2004 when $2 billion in grants were awarded to faith-based groups across the same agencies. Since 2003, HHS, HUD, DOJ, DOL and education, have seen a 38 percent increase in the number of grants to faith-based groups--an increase of 616 grants compared to 2003; and a 21-percent increase in grant money awarded to faith-based organizations--an increase of more than $239 million.

* Faith-based organizations are consistently winning a larger share of competitive funding. HHS programs represented the majority of available funding included in the report. HHS has seen a 64-percent increase in the amount of funding to faith-based groups since fiscal year 2002--from $477 million to $780 million.

* From 2002 to 2006, Bush requested $1.35 billion and Congress has appropriated $742 million for targeted initiatives that mentor children of prisoners, train re-entering prisoners, treat addicts in the program of their choosing, discourage at-risk youth from gang activity, and provide technical assistance to small organizations seeking to help more people in need. The president's 2007 budget calls for an additional $323 million for these programs, including funds for a new effort combating the spread of HIV/AIDS in minority communities.

* This past February, the president signed the Deficit Reduction Act of 2005, which reauthorized welfare reform for another five years. The legislation also extended for five years a policy called charitable choice, which allows faith-based groups providing social services to receive federal funding without altering their religious identities or changing their hiring practices.

Under the Deficit Reduction Act, Charitable Choice provisions will now apply to two new grant programs focusing on supporting healthy marriages and responsible fatherhood.

Both Bush and Towey hammered the point that legislation blocks faith-based charities from accessing many federal grants. The three largest competitive grant programs at HHS, with combined funds in excess of $8.3 billion, operate under statutes that limit competition. For example, only 5.9 percent of Head Start funds went to faith-based groups during fiscal year 2005.

And, in an examination of five unidentified formula grant programs, faith-based groups received a small amount of funding, ranging from 1.7 percent to 5.5 percent.

"There's a lot of work to be done, obviously," said Bush. "We still have pockets of poverty where people wonder whether or not the American experience belongs to them."