Government Funding and the Unconstitutional Conditions Doctrine

A Federal district court in New York has ruled that a Bush administration requirement that any international agencies receiving funding for programs to combat AIDS must sign an anti-prostitution pledge is unconstitutional. See the ruling here. Two international groups filed suit against the US Agency for International Development (USAID), arguing that the restriction violates their first amendment rights. The restriction is found in a 2003 act called the United States Leadership Against HIV/AIDS, Tuberculosis, and Malaria Act of 2003.

The problematic provision of the act was designed solely to appease the moralists among the religious right, but that's not particularly relevant to the legal questions. There are two provisions in the act that are germane to the discussion. The first one is a restriction on the use of government funds:

No funds made available to carry out this Act, or any amendment made by this Act, may be used to promote or advocate the legalization or practice of prostitution or sex trafficking. Nothing in the preceding sentence shall be construed to preclude the provision to individuals of palliative care, treatment, or post-exposure
pharmaceutical prophylaxis, and necessary pharmaceuticals and commodities, including test kits, condoms, and, when proven effective, microbicides.

That portion of the act was not challenged. Both sides accept that the government may place restrictions on what taxpayer funds may be used for. But the second provision, which says that no funds that can be given "to any group or organization that does not have a policy explicitly opposing prostitution", was challenged as an unconstitutional restriction on the free speech rights of the organization.

Initially, the DOJ advised the USAID that this restriction could not be placed on US-based organizations because it would be an unconstitutional restriction of free speech rights under the first amendment. But under pressure from the White House and Congress, the DOJ reversed itself and in June 2005, the USAID issue new regulations that applied this restriction to US-based organizations as well as ones based in other countries. That is what prompted the suit.

Though the ruling focuses primarily on statutory interpretation, particular whether the policy requirement provision should be read broadly (to require that the organization actively fight against prostitution) or narrowly (to require only that the organization issue an official position statement that prostitution can be harmful), this implicates some interesting precedents regarding the general idea of what restrictions can be placed on government funds.

In particular, it implicates the unconstitutional conditions doctrine, which says that the government "can not place conditions on its granting of public benefits or subsidies that cause the recipient to surrender vital constitutional rights, even if the government has no obligation to provide the benefit and thus could withhold it altogether." In other words, the government is not required to give such funding, but if it chooses to it can't do so in a way that requires recipients to give up their constitutional rights. For example, the government may choose to provide vouchers to the poor to help offset the burden of high gas prices, but it cannot restrict that funding by offering it only to those who voted Republican in the last election.

Indeed, the court reiterated that in a decision just two months ago, Rumsfeld v Forum for Academic and Institutional Rights. In that case, while they ruled that the policy of withholding funds for public universities that deny the right of military recruiters to recruit on campus was constitutional, they reiterated, unanimously, that "the government may not deny a benefit to a person on a basis that infringes his constitutionally protected...freedom of speech even if he has no entitlement to that benefit." And while it did not apply that standard in that case, because they ruled (rightly) that the schools had no right to prevent military recruiters from coming on campus, it clearly applies in this case.

The key case on the unconstitutional conditions doctrine is Speiser v. Randall, a 1958 case involving a property tax exemption that was given to veterans. The government conditioned that tax exemption on the veterans signing a document that they would never advocate against the US government in times of war. The court ruled that "to deny an exemption to claimants who engage in certain forms of speech is in effect to penalize them for such speech." Since then, this doctrine has been upheld many times.

The two precedents that immediately came to mind when I heard of this ruling were the two cases argued during the first Bush administration, Rust v Sullivan (1991) and Webster v Reproductive Health Services (1989). Both involved government restrictions on advocating or counseling women about their abortion rights for agencies that received funding from the government. But those cases involved what restrictions could be placed on the funding itself - what the funds could be used for - and not speech that was funded with private money.

In Rust, the Federal regulations did not require that family planning clinics not engage in any advocacy or counseling with patients about abortion, they only required that such activities be kept distinct from the family planning programs that were funded with Federal tax money. In Webster, which involved state funding in Missouri, the restriction was, again, only on what the government funds could be used for. So neither of those cases apply well here. Instead, the cases in Speiser line are the most appropriate to apply.

Here's a good way to think about this doctrine. The government can, for example, decide that no tax money may be used for stem cell research. It's stupid beyond belief, of course, and it's just another example of the Bush administration pandering to their most ignorant constituents, but there's no constitutional violation there. But they cannot decide that no research agency may receive any funding unless they state publicly that they oppose stem cell research. That's the key distinction - they don't have to fund it, but they can't premise their funding on compelled speech or lack thereof.