Trump administrator proposes last-ditch effort to offer SBA loans to religious groups

A proposal made on the last day of the Trump administration would make religious businesses eligible to receive loans from the Small Business Administration, removing previous restrictions.

The US Small Business Administration released a proposal on Jan. 19 that would remove five restrictions that “violate the Free Exercise Clause of the First Amendment.” The five provisions prohibit certain faith-based organizations from participating in certain SBA business loan and disaster assistance programs because of their religious status. ” summary of proposal status.

“Because the provisions exclude a category of potential participants based solely on their religious status, the provisions violate the free exercise clause of the First Amendment. The SBA is now proposing to remove provisions in its business loan and disaster assistance programs for equal treatment of faith-based organizations that the Constitution requires, ”the summary added.

If passed, the proposal would allow religious businesses to qualify for SBA loans, although it is not clear whether it would also allow churches and other places of worship to be eligible as well. the Washington Post reported.

The SBA proposal cites two Supreme Court cases as a precedent for removing religious exclusions from the SBA loan qualification criteria.

In Trinity Lutheran Church of Columbia, Inc. v Comer the Supreme Court ruled that a playground resurfacing grant that excluded churches and religious organizations was unconstitutional. The court said the grant violated the free exercise clause, which “ protects[s] religious observers against unequal treatment ”and subject to the strictest control laws that target religious for“ special disabilities ”based on their“ religious status ”. “

In Department of Revenue Espinoza v. Montana, the Supreme Court overturned a state court decision to block religious schools from a scholarship program. While the state argued that it had an interest in preventing religious use of funds, the Supreme Court ruled that “status discrimination remains status based even if one of its purposes or effects is to prevent religious organizations from providing aid for religious purposes. The SBA also noted that its proposal also follows President Trump’s 2017 executive order titled Promoting Free Speech and Religious Freedom. The ordinance stated that “Federal law protects the freedoms of Americans and their organizations. ‘exercise their religion and participate fully in civic life without undue interference from the federal government’ and added that the executive branch would enforce these protections. In addition, the removal of religious restrictions also follows a decision by the Trump administration to ” allow religious organizations to apply for the Payment Protection Program, a coronavirus relief program that has provided billions of dollars in pandemic relief to businesses and nonprofits, including thousands of Catholics parishes, schools and other religious organizations.

The proposal is likely to spark a heated debate over religious freedom under the Biden administration. While the First Amendment’s free exercise clause guarantees the free practice of religion, the establishment clause prohibits the US Congress from establishing a religion by law.

About Geraldine Higgins

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