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1 1 (June 14, 2004)

handle is hein.crs/crsahqt0001 and id is 1 raw text is: Order Code RS20948
Updated June 14, 2004
CRS Report for Congress
Received through the CRS Web
Charitable Choice Provisions of H.R. 7
Vee Burke
Domestic Social Policy Division
Summary
H.R. 7, the Community Solutions Act, on July 19, 2001, won House passage by a
vote of 233-198. The bill includes basic elements of President Bush's faith-based
initiatives: tax incentives for private giving - scaled back from original proposals (Title
I) -  and expansion of charitable choice (Title II). (Title III deals with individual
development accounts.) H.R. 7 would apply to 9 new program areas charitable
choice rules, which forbid discrimination on grounds of religion against faith-based
organizations as providers of specified federally funded services. It includes provisions
aimed at protecting the religious independence of faith-based organizations (for
instance, the right to hire only co-religionists and retain symbols) and protecting the
religious freedom of beneficiaries (for instance, the right to an alternate and accessible
provider). The bill bars use of federal grant/cooperative agreement funds (but not
voucher payments) for sectarian worship. Note: This bill expired at the end of the 107th
Congress. President Bush then issued an Executive Order (013279) directing several
Cabinet departments to adopt charitable choice rules to the extent permitted by law.
Charitable choice is a set of provisions in law intended to allow religious
organizations to provide federally funded services from designated programs on the same
basis as any other nongovernmental provider without impairing the religious character of
the organizations or the religious freedom of recipients. Charitable choice contains no
earmarked funding for faith-based organizations. The 1996 welfare reform law first
enacted charitable choice language, applying it to the new block grant program of
Temporary Assistance for Needy Families (TANF) and, to the extent that they use
contracts or vouchers, to food stamps, Medicaid, and Supplemental Security Income
(SSI). In 1998, Congress extended charitable choice rules to grants under the Community
Services Block Grant Act and, in 2000, to grants for prevention and treatment of
substance abuse under the Public Health Service Act.
As modified by the Ways and Means Committee and passed by the House, Title I of
H.R. 7 would allow a non-itemizing tax filer in 2002 and 2003 a maximum deduction of
$25 ($50 for joint filers) for charitable contributions; the amount would increase by
stages, reaching $100 ($200 for joint filers) in 2010. (This provision is estimated to
reduce revenue by $6.4 billion over 10 years, compared with the original proposal's cost
of $84 billion.) Other tax provisions in the House bill include allowing persons aged 70-
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