This week, the Department of Justice Office of Legal Counsel issued a 39-page Opinion captioned: Constitutionality of Religious Restrictions on the Use of Federal Funds, 50 Op. O.L.C. __ (Aug. 25, 2026). The Opinion updates guidance given in 2019 on the constitutionality of statutes that bar federal funding for programs of faith-based institutions where the funds will be used for religious purposes. The Opinion responds to questions from the Department of Health and Human Services regarding restrictions in several statutes that it administers. The Opinion reads in part:
HHS has asked whether it must update its framework for assessing grants to faith-based organizations in the light of the Supreme Court’s intervening precedent.... Specifically, HHS asked: (1) whether the religious restrictions applicable to HHS are required by the Establishment Clause; and (2) if not, whether they are constitutional under the Free Exercise Clause.... The answer to both questions is no. To the extent our 2019 opinion indicated otherwise,... , it no longer reflects the current state of the law....
The Supreme Court has now “instructed that the Establishment Clause must be interpreted by ‘reference to historical practices and understandings’” from the time the First Amendment was ratified....
To identify the historical practices and understandings relevant to the Establishment Clause, the Supreme Court has pointed us toward the “hallmarks of religious establishments the framers sought to prohibit when they adopted the First Amendment.”....
“[C]oercion . . . was among the foremost hallmarks of religious establishments.... Additional hallmarks include: Governmental “control over the doctrine and personnel of the established church.” ... Punishment and suppression of dissenting churches and individuals for their religious exercise.... Restricted political participation for dissenting churches and individuals.... Compelled “financial support for the established church.... Giving the established church “monopolistic control over civil functions”....
... Having given those legal developments close consideration, we now conclude that the government has less discretion to exclude faith-based funding uses from facially neutral grant programs than our 2019 opinion suggested. ...
From this series of cases ... we draw three free-exercise principles, which together establish an updated framework for analyzing religious restrictions:
• First, strict scrutiny applies whenever a generally available benefit is denied or burdened on account of religion, whether the trigger is the recipient’s religious status ... or its “anticipated religious use” of the benefit
• Second, a funding condition that requires a religious recipient to segregate or suppress religious exercise as the price of its participation is such a burden, and the government may not avoid that conclusion by “reconceptualiz[ing]” the restriction as part of “the definition of a particular program.”...
• Third, line-drawing among practices that involve “worship,” “instruction,” and “proselytization” is itself constitutionally suspect because it requires the government to make theological judgments and risks denominational favoritism, thus collapsing back into status-based discrimination requiring strict scrutiny.....
Prof. Stephanie Barcclay discussed the Opinion in a posting on X.
[Thanks to Greg Chafuen for the lead.]
