This section of the FEDERAL REGISTER

contains notices to the public of the proposed

issuance of rules and regulations. The

purpose of these notices is to give interested

persons an opportunity to participate in the

rule making prior to the adoption of the final

rules.

Proposed Rules Federal Register

1401 

Vol. 90, No. 5 

Wednesday, January 8, 2025 

DEPARTMENT OF STATE 

2 CFR Part 602 

48 CFR Parts 625 and 652 

[Public Notice: 12630] 

RIN 1400–AF65 

RIN 1400–AF66 

Department of State Acquisition 

Regulation: Nondiscrimination in 

Foreign Assistance; Withdrawal of Two 

NPRMs 

AGENCY: Department of State. 

ACTION: Withdrawal of notices of 

proposed rulemaking and termination of 

rulemaking proceedings. 

SUMMARY: The Department of State (the 

Department) hereby withdraws two 

notices of proposed rulemaking 

(NPRMs) that proposed specific contract 

and grant terms that would have 

prohibited the discriminatory use of 

Department foreign assistance funds on 

specified grounds. 

DATES: The two notices of proposed 

rulemaking published in the Federal 

Register on January 19, 2024 (89 FR 

3583 and 89 FR 3625, respectively) are 

withdrawn as of January 8, 2025. 

FOR FURTHER INFORMATION CONTACT: 

Kenneth Kero-Mentz, Senior Advisor in 

the Bureau of Democracy, Human 

Rights, & Labor, Department of State, 

keromentzk@state.gov, 202–647–3087. 

SUPPLEMENTARY INFORMATION: 

Background 

On January 19, 2024, the Department 

published two NPRMs in the Federal 

Register that sought to amend the 

Department of State Acquisition 

Regulation (DOSAR) and the 

Department’s grant rules. 

The DOSAR rule (RIN 1400–AF65), 

‘‘Department of State Acquisition 

Regulation: Nondiscrimination in 

Foreign Assistance,’’ proposed to amend 

the DOSAR (48 CFR Chapter 6) to 

include a new contract clause entitled 

‘‘Nondiscrimination in Foreign 

Assistance.’’ The amended clause would 

have stated that contractors and 

subcontractors receiving Departmentfunded foreign assistance funds must 

not discriminate on specified bases 

against end-users of supplies or services 

or in certain employment decisions 

involving persons employed in the 

performance of the covered contract and 

funded in whole or in part with foreign 

assistance funds, with limited 

exceptions as specified in the relevant 

statement of work or as otherwise 

required by U.S. law. 

The grants rule (RIN 1400–AF66), 

‘‘Nondiscrimination in Foreign 

Assistance,’’ proposed to revise 2 CFR 

part 600 to add an award term at § 602, 

entitled ‘‘Nondiscrimination in Foreign 

Assistance.’’ As set out in the NPRM, 

the proposed award term, applicable to 

all solicitations, Federal awards, and 

subawards funded with Department of 

State foreign assistance funds, would 

prohibit recipients and subrecipients 

from discriminating against 

beneficiaries or potential beneficiaries 

(i.e., those individuals intended to 

receive the benefits of the award or 

persons employed in the performance of 

the award) on the basis of specified 

characteristics. 

The Department accepted public 

comments on both NPRMs through 

March 19, 2024. There were 26 public 

comments submitted in response to the 

DOSAR proposed rule, and 50 public 

comments submitted in response to the 

grants proposed rule. Although the two 

rules are distinct in their scope, the 

issues raised for both rules were 

substantively similar. 

Withdrawal of the Notices of Proposed 

Rulemaking and Termination of the 

Rulemaking Proceedings 

The Department believes that two of 

the issues raised by the public would 

benefit from further study that will 

extend beyond the time remaining in 

the administration. Accordingly, the 

Department is withdrawing these 

NPRMs and terminating these 

rulemaking proceedings at this time. 

In particular, the Department notes 

the concern expressed in some public 

comments that faith-based 

implementing organizations would be 

prohibited from employing individuals 

of a particular religion. In considering 

alternative text to provide more clarity 

on this issue in the final rules, it became 

clear that additional time would be 

necessary to fully consider the 

suggestions provided by commenters 

and relevant regulatory provisions 

applicable to other Federal agency 

partnerships with faith-based 

organizations. See, e.g., 29 CFR 2.37 

(Department of Labor); 7 CFR 16.3(h) 

(Department of Agriculture); 38 CFR 

50.2(h) (Department of Veterans Affairs); 

45 CFR 87.3(h) (Department of Health 

and Human Services). 

The Department also determined that 

additional time would be needed to 

fully consider comments from both 

supporters and opponents of the 

proposed rules on the need for more 

specific criteria on the rules’ proposed 

waiver provision. Several of these 

commenters sought to ensure that the 

provision authorizing waivers ‘‘in the 

best interest of the government’’ on a 

range of issues would be applied on a 

clear and consistent basis. Some 

commenters referred to the proposed 

‘‘totality of the circumstances’’ factor, 

stating their view that this language 

would not be enough to guarantee that 

the concerns of religious organizations 

will be protected. Other commenters 

recommended that additional language 

be included to ensure that waivers 

would be provided sparingly and only 

in rare and exceptional cases. The 

Department appreciates these comments 

and, as noted above, requires additional 

time to consider this issue. 

The Department is withdrawing these 

proposed rules and terminating these 

rulemaking proceedings for the above, 

independently sufficient reasons 

concerning the need for further study 

that will extend beyond the time 

remaining in the administration. The 

Department is not withdrawing these 

proposed rules based on a changed view 

of the Secretary’s authority in this area. 

These rulemaking proceedings were 

authorized by the Secretary’s 

longstanding and existing authority, as 

delegated from the President, to set the 

terms and conditions for use of Foreign 

Assistance Act funding, as explained in 

the two NPRMs. 

The Department of State does not 

intend for final rules to be issued on the 

basis of these NPRMs. 

Zachary Parker, 

Director, Office of Organizational Policy, U.S. 

Department of State. 

[FR Doc. 2025–00202 Filed 1–7–25; 8:45 am] 

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