[Federal Register Volume 60, Number 246 (Friday, December 22, 1995)]
[Rules and Regulations]
[Pages 66491-66495]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 95-31089]



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DEPARTMENT OF COMMERCE

National Telecommunications and Information Administration

15 CFR Part 2301

[Docket Number 950613151-5304-02]
RIN 0660-XX02


Public Telecommunications Facilities Program (PTFP), National 
Endowment for Children's Educational Television (NECET), 
Telecommunications and Information Infrastructure Assistance Program 
(TIIAP)

AGENCY: National Telecommunications and Information Administration, 
Commerce.

ACTION: Final Policy Statement and Conforming Rule Amendments.

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SUMMARY: The National Telecommunications and Information Administration 
(NTIA), U.S. Department of Commerce, is publishing a Final Policy 
Statement modifying the interpretation of its policy on the use of 
NTIA-funded equipment and materials in connection with sectarian 
activities and making conforming rule amendments.

Effective Date: December 22, 1995.

FOR FURTHER INFORMATION CONTACT: Jana Gagner, (202) 482-1816.

SUPPLEMENTARY INFORMATION:

I. Introduction

    On June 20, 1995, the National Telecommunications and Information 
Administration, U.S. Department of Commerce (NTIA), published a notice 
in the Federal Register proposing to modify NTIA's interpretation of 
its policy regarding the use of Federal grant funds awarded by NTIA in 
connection with sectarian activities.<SUP>1 Eight parties filed 
comments in response to the Notice.<SUP>2 Based on these comments and 
current jurisprudence, NTIA is hereby modifying its prior 
interpretation of its rules, which prohibited the use of NTIA-funded 
equipment, facilities, and materials in connection with any sectarian 
activities, no matter how incidental.

    \1\  60 FR 32,142 (1995).
    \2\  The following eight parties filed comments in response to 
the Notice: Representative Richard Burr, the Corporation for Public 
Broadcasting, Fordham University, National Public Radio, North 
Carolina Public Radio Association, Lisa Owens, Southern Public 
Radio, and Wake Forest University.
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    Under its new interpretation, NTIA will retain its present 
requirement that grant funds not be used for purposes the ``essential 
thrust of which are sectarian,'' <SUP>3 but will modify its 
interpretation of this requirement as follows. No more than an 
attenuated or incidental benefit may inure to a sectarian interest if a 
grantee uses NTIA-funded facilities in connection with a sectarian 
activity. In addition, the use must fall within the broad scope of a 
grant program's statutory purposes. A grantee cannot, however, use NTIA 
grant funds primarily to support sectarian interests.

    \3\ 15 CFR 2301.22(d). ``Sectarian'' is defined at 15 CFR 2301.1 
as ``that which has the purpose or function of advancing or 
propagating a religious belief.'' The PTFP regulation at 15 CFR 
Sec. 2301.22(d) provides, ``During the period in which the grantee 
possesses or uses the Federally funded facilities (whether or not 
this period extends beyond the Federal interest period), the grantee 
may not use or allow the use of the Federally funded equipment for 
purposes the essential thrust of which are sectarian.'' NTIA 
considers these phrases to mean the same thing.
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    For the reasons discussed below, NTIA believes that this approach 
is consistent with current jurisprudence.<SUP>4 We also discuss below 
in greater detail the issues raised in the June Notice regarding NTIA's 
policy on sectarian activities,<SUP>5 NTIA's interpretation of its 
prior policy, comments received by NTIA in response to the Notice, and 
the application of NTIA's new policy to each of its grant programs. Our 
discussion is informed by relevant First Amendment jurisprudence, 
including the recent Supreme Court holding in Rosenberger v. Rector and 
Visitors of the University of Virginia, 115 S.Ct. 2510 (1995).

    \4\ See Rosenberger v. Rector and Visitors of the University of 
Virginia, 115 S.Ct. 2510 (1995); Zobrest v. Catalina Foothills Sch. 
Dist. (Zobrest), 113 S.Ct. 2462 (1993); Witters v. Washington Dep't 
of Services for the Blind, 474 U.S. 481, 487 (1986); Mueller v. 
Allen, 463 U.S. 388 (1983).
    \5\ Notice, supra note 1.
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II. Background

    NTIA's Prior Policy. In 1979, the Public Telecommunications 
Facilities Program (PTFP) of the NTIA adopted a rule prohibiting 
funding for any equipment, facilities, and other materials that would 
be used for any purposes the essential thrust of which is 
sectarian.<SUP>6 NTIA's interpretation of this rule has prohibited use 
of NTIA-funded facilities and materials in connection with any 
sectarian activity.<SUP>7 In implementing this ``bright-line'' policy 
interpretation, NTIA relied upon Lemon v. Kurtzman.<SUP>8

    \6\ See 44 FR 30898 (1979) for explanation of NTIA's previous 
policy. PTFP's regulation regarding sectarian programming appears at 
15 CFR 2301.22(d).
    \7\ This interpretation stems from policy statement, infra fn. 
11 and was applied in the Fordham case.
    \8\ 403 U.S. 602 (1971). The constitutional test set forth in 
Lemon--and the consistency between NTIA's new policy interpretation 
and that test--are described in section III.A. of this policy 
statement, infra. 
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    NTIA's policy interpretation did, however, permit the 
``presentation in an educational or cultural context of music or art 
with a religious theme [or] of programs about religion. It [also did] 
not preclude distribution of instructional programming of a secular 
nature to church-related educational institutions.'' <SUP>9 In 
addition, sectarian-affiliated organizations could generally apply for 
grant funds,<SUP>10 subject, of course, to the prohibition on the use 
of NTIA-funded equipment, facilities, and materials for purposes the 
essential thrust of which is sectarian. NTIA's two newer grant 
programs, the National Endowment for Children's Educational Television 
(NECET) and the Telecommunications and Information Infrastructure 
Assistance Program (TIIAP), also adopted the same policy and 
interpretation.<SUP>11

    \9\ Public Telecommunications Facilities Program; Report and 
Order, 44 FR 30898, 30902 (1979) (Report and Order).
    \10\ Id. at 30,900-30,901. Previously, organizations organized 
for primarily religious purposes were ineligible to apply for a PTFP 
planning grant, although their affiliates were eligible to apply. 
See 15 CFR 2301.4(b)(2). We are revising this rule to be consistent 
with the new policy adopted herein, such that applicant eligibility 
will be the same for both construction and planning grants. See the 
conforming amendments to Sec. 2301.4 (a) and (b).
    \11\ 60 FR 15636 (1995); 60 FR 8156 (1995).
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    In enforcing this policy over the years, NTIA required grant 
applicants to certify that they would comply with its policy by signing 
an assurance to that effect.<SUP>12 By relying upon this assurance, 
NTIA avoided evaluating programming schedules for sectarian content as 
a routine practice. Such evaluation occurred only if information 
contained in the application itself suggested that the applicant would 
violate NTIA's policy, a complaint was filed with NTIA, or NTIA 
otherwise became aware of information that suggested that its policy 
was being or would be violated. By not routinely evaluating program 
content and information transmitted using NTIA-funded equipment and 
materials, NTIA avoided excessive Government entanglement with 
religion, 

[[Page 66492]]
as proscribed by the Supreme Court in Lemon v. Kurtzman.<SUP>13

    \12\ The applicant ``will not use or allow the use of the 
facilities for essentially sectarian purposes for as long as the 
Applicant possesses or uses the facilities . . . .'' Public 
Telecommunications Facilities Program, Grant Application, 
Assurances, no. 30, at 9.
    \13\ For a discussion of this point, see Section III.A. of this 
policy statement.
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    The Challenge by Fordham University. In 1993, Fordham University 
sued the Department of Commerce, alleging that NTIA's policy on 
sectarian broadcasting violated its right to free exercise of religion 
and its freedom of speech rights under the First Amendment of the 
Constitution. In Fordham University v. Brown, the court upheld NTIA's 
bright-line approach with respect to the PTFP as consistent with the 
First Amendment.<SUP>14 In dicta, however, the court noted that it did 
not consider whether there were other acceptable interpretations of the 
Establishment Clause.<SUP>15

    \14\ 856 F. Supp. 684 (D.D.C. 1994), appeal docketed, No. 94-
5229 (D.C. Cir. Aug. 22, 1994).
    \15\ Id. at 697-698.
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    Since the Fordham decision, NTIA has become aware that some public 
broadcast stations include in their schedules programs that might 
constitute impermissible sectarian programming, which could make them 
ineligible for PTFP grants. This was highlighted, in fact, following 
the Fordham decision, when NTIA received several requests to modify its 
policy.
    Issuance of the Notice. As a result, NTIA sought comment on whether 
it should modify its policy regarding sectarian programming and 
information. Specifically the Notice sought comment on: (1) Whether the 
current prohibition on using NTIA grant funds in connection with any 
sectarian activities should be continued, or whether there are 
alternative approaches that would also be consistent with the First 
Amendment; (2) the underlying policy rationale for a given approach; 
(3) how such policy would, as practical and constitutional matters, be 
implemented and enforced; (4) whether the same policy could and should 
be applied to all three NTIA grant programs (PTFP, TIIAP, and NECET) 
and, if not, what policy should pertain to each grant program; and (5) 
whether the current definition of ``sectarian'' would continue to be 
supportable if NTIA's current policy were modified.
    The Rosenberger Decision. Subsequent to the issuance of NTIA's 
Notice, the Supreme Court decided Rosenberger v. Rector and Visitors of 
the University of Virginia,<SUP>16 which further supports NTIA's 
announced policy interpretation change. The Supreme Court held in 
Rosenberger that a state university had erred in relying on the First 
Amendment's Establishment Clause to deny grant funding to a student 
group publisher of a Christian magazine, when that student group 
otherwise satisfied neutral funding criteria applied by the university 
in making financial grants to other student organizations. As discussed 
in more detail below, this decision serves as a basis, in part, for the 
new policy approach adopted by NTIA.

    \16\ 115 S.Ct. 2510 (1995).
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    Comments Filed in Response to the Notice. All but one of the eight 
commenters supported a change in NTIA's policy interpretation. The one 
commenter favoring retention of NTIA's long-term policy objected to a 
religious organization receiving any benefit, however incidental, from 
NTIA's grant programs.<SUP>17 A majority of the supporting commenters, 
however, relied upon the recent Supreme Court case, Rosenberger, in 
arguing that a policy change was warranted. Most agreed that 
Rosenberger requires that the Federal government behave in a neutral 
manner toward religion. Two commenters recommended that NTIA adopt a 
specified or maximum percentage for the amount of permissible sectarian 
programming.<SUP>18 Other commenters recommended allowing a 
``reasonable minimal amount of sectarian programming.'' <SUP>19 Two 
other commenters expressed some concern that the proposed change in 
policy could result in excessive government entanglement with 
religion.<SUP>20

    \17\ Comments of Lisa Owens.
    \18\ Comments of National Public Radio at 2,5; Comments of Wake 
Forest at 2-3.
    \19\ Comments of North Carolina Public Radio Association at 1; 
Comments of Honorable Richard Burr at 1; Comments of Southern Public 
Radio at 1.
    \20\ Comments of Corporation for Public Broadcasting at 3; 
Comments of National Public Radio at 3.
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    As noted above, we solicited comments on whether the definition of 
``sectarian'' needed to be altered in light of a possible policy 
change. Most commenters agreed that no change in the definition of 
``sectarian'' was required to allow NTIA to modify its policy 
interpretation. One commenter contended, however, that the definition 
of ``public telecommunications services'' had to be redefined because 
it provides that public telecommunications services ``[do] not include 
essentially sectarian programming.'' <SUP>21 This commenter also 
maintained that NTIA's prior policy should be changed because it 
burdened individuals' free exercise of religion in violation of the 
Religious Freedom Restoration Act.<SUP>22

    \21\ Comments of Fordham University at 16-17.
    \22\ Comments of Fordham University at 9.
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III. Application of the Modified Policy To NTIA'S Grant Programs

    As indicated, NTIA's new policy will retain the requirement that 
grant funds not be used for purposes the essential thrust of which is 
sectarian. The interpretation of that requirement will be modified, 
however, such that as long as the grant funds are used to fulfill the 
statutory purposes of the grant programs, attenuated or incidental 
benefits to sectarian interests will be permissible.

A. Constitutional Basis for Modified Policy

    We believe the alternative approach we are now adopting passes 
constitutional muster under First Amendment case law. Having analyzed 
our new approach in light of Lemon v. Kurtzman,<SUP>23 we conclude that 
our new policy is consistent with Lemon and other Supreme Court 
jurisprudence. Lemon established a three-prong test to determine 
whether government action would have the ``primary effect'' of 
establishing religion in violation of the Establishment Clause. Under 
Lemon, the constitutionality of a statute, regulation, or funding 
policy depends on whether: (1) it has a secular legislative purpose; 
(2) its principal or primary effect is one that neither advances nor 
inhibits religion; and (3) it avoids ``an excessive government 
entanglement with religion.'' <SUP>24 If any one of these three 
questions is answered in the negative, government action is deemed 
unconstitutional.

    \23\ 403 U.S. 602 (1971).
    \24\ Id. at 612-613.
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    Each of NTIA's grant programs has a secular purpose, which remains 
unchanged under the new policy, and thus NTIA's change in policy 
interpretation passes the first prong of the Lemon test. PTFP promotes 
public broadcasting, NECET supports development of children's 
programming, and TIIAP promotes new telecommunications technologies. 
Each grant award will be reviewed to ensure it meets the appropriate 
statutory purpose.
    NTIA's new policy interpretation also satisfies the second prong of 
the Lemon test as NTIA grant funds still may not be used primarily to 
advance or inhibit religion. As recently underscored by the Rosenberger 
court, programs that neutrally extend benefits to recipients pass 
Establishment Clause muster, if religious interests are only 
incidentally served:

[[Page 66493]]

    [T]he [constitutional] guarantee of neutrality [toward religion] 
is respected, not offended, when the government, following neutral 
criteria and evenhanded policies, extends benefits to recipients 
whose ideologies and viewpoints, including religious ones, are broad 
and diverse. . . . More than once have we rejected the position that 
the Establishment Clause even justifies, much less requires, a 
refusal to extend free speech rights to religious speakers who 
participate in broad-reaching government programs neutral in design. 
115 S.Ct. at 2521-22 (emphasis added).

    NTIA's new policy interpretation will ensure both that the program 
funds are neutrally provided and that any benefit to religion will be 
attenuated or incidental. NTIA will behave neutrally toward all grant 
applicants. All grant applicants (including sectarian organizations) 
will be eligible for funding (assuming they meet NTIA's other 
eligibility requirements), provided they comply with the policy that 
NTIA grant funds will not be used for purposes the essential thrust of 
which is sectarian.<SUP>25 If, as we discuss further below, questions 
arise regarding compliance, however, NTIA will determine whether the 
recipients' use of grant funds has the primary, and thus impermissible, 
effect of advancing or inhibiting religion. Where some benefit appears 
to inure to a sectarian interest, further analysis of the potential 
benefit will be undertaken to determine whether it is merely 
incidential or attenuated and thus permissible.

    \25\ The PTFP regulation at 15 C.F.R. Sec. 2301.22(d) provides: 
``During the period in which the grantee possesses or uses the 
Federally funded facilities (whether or not this period extends 
beyond the Federal interest period), the grantee may not use or 
allow the use of the Federally funded equipment for purposes the 
essential thrust of which are sectarian.'' The assurance contained 
in the PTFP application kit provides that the applicant certify that 
he/she ``will not use or allow the use of the facilities for 
essentially sectarian purposes for as long as the Applicant 
possesses or uses the facilities, whether or not this period extends 
beyond the ten-year Federal interest period following completion of 
this project.'' NTIA considers these phrases to mean the same thing. 
See also n. 3, supra.
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    With regard to the third prong of the Lemon test--avoiding 
excessive entanglement of goverment with religion--NTIA's 
administrative procedures will remain esssentially the same as before. 
NTIA will avoid analyzing individual programs unless a compliance 
problem comes to NTIA's attention. Thus, under the new policy, 
excessive government entanglement with religion will continue to be 
avoided as under our prior policy.

B. Application of New Interpretation to Particular NTIA Programs

    Specific application of this new interpretation to each of the 
three NTIA grant programs is discussed below.
1. The Public Telecommunications Facilities Program (PTFP).
    Under the PTFP rules, a sectarian organization is eligible to apply 
as long as it meets the general PTFP eligibility requirements.<SUP>26 
The purpose of PTFP is to make public telecommunications services 
available to U.S. citizens. PTFP funds the construction and planning of 
public telecommunications services,<SUP>27 subject to the eligibility 
requirements for applicants.<SUP>28

    \26\ To be eligible for a construction or planning grant, an 
applicant must be one of the following: a public broadcast station; 
a noncommercial telecommunications entity; a system of public 
telecommunications entities; a nonprofit foundation, corporation, 
institution, or association organized primarily for educational or 
cultural purposes; or a state or local government (or any agency 
thereof), or a political or special purpose subdivision of a state. 
See 15 CFR Sec. 2301.4(a), (b).
    \27\ 47 U.S.C. 390-393; 15 CFR Part 2301 et seq.
    \28\ For definitions of eligible organizations and projects, see 
15 CFR 2301.4.
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    To determine whether a grant would have the primary effect of 
establishing religion, NTIA will apply the Lemon test. To determine 
eligibility and the overall purpose of the planning and construction of 
public telecommunications facilities, NTIA will examine the applicant's 
proposal and its organizational purposes, as required by the statutory 
criteria. This approach ensures that grant awards will neither advance 
nor inhibit religion.
    To avoid Government entanglement in religion and programming 
decisions, NTIA will continue its policy of reviewing the project 
narrative and supporting documents, while also relying on the 
applicants' assurances that they comply with NTIA's policy on sectarian 
activities. General monitoring of grantees' activities will continue 
under the normal administrative process pertaining to Federal 
assistance programs.
    Accordingly, as under our prior policy, submission of broadcast 
schedules and program listings will not generally be required. We will 
not review the content of all programs or activities for sectarian 
content unless NTIA receives a complaint or otherwise becomes aware 
that an applicant or grantee may be using NTIA-funded equipment or 
materials in connection with a project the essential thrust of which is 
sectarian. For example, under the prior approach, a single sectarian 
program in a broadcast schedule would have rendered the project 
ineligible for funding. Under our new approach, a single program with 
sectarian aspects will not necessarily render the project 
ineligible.<SUP>29 In such instances, NTIA will examine the overall 
purpose of the project to determine if it is consistent with the PTFP's 
statutory purposes. Further inquiry may be made as necessary to ensure 
that any benefit to a sectarian interest is merely attenuated or 
incidental as permitted under current jurisprudence.

    \29\ While this example uses one program, we wish to emphasize 
that we are not setting any percentage or hourly maximum on the 
amount of sectarian programming that would be considered allowable.
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    To implement this new approach, we do not need to revise the 
language in the PTFP regulation, assurance or definition of 
``sectarian'' as it pertains to our policy on sectarian 
activities.<SUP>30 We shall, however, revise the definition of ``public 
telecommunications services'' to delete the last sentence which 
provides, ``It does not include essentially sectarian programming.'' 
<SUP>31

    \30\ See 15 CFR 2301.1; 15 CFR 2301.5(d)(2)(xvi); 15 CFR 
2301.22(d). The PTFP regulation at 15 CFR 2301.22(d) provides: 
``During the period in which the grantee possesses or uses the 
Federally funded facilities (whether or not this period extends 
beyond the Federal interest period), the grantee may not use or 
allow the use of the Federally funded equipment for purposes the 
essential thrust of which are sectarian.'' The assurance contained 
in the PTFP application kit provides that the applicant certify that 
he/she ``will not use or allow the use of the facilities for 
essentially sectarian purposes for as long as the Applicant 
possesses or uses the facilities, whether or not this period extends 
beyond the ten-year Federal interest period following completion of 
this project.'' NTIA considers these phrases to mean the same thing.
    \31\ 15 CFR 2301.1.
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2. National Endowment for Children's Educational Television (NECET)
    Pursuant to NECET's enabling legislation,<SUP>32 in order to be 
eligible to apply for a grant, an applicant must be one of the 
following: an individual, corporation (for-profit or not-for-profit), 
partnership, association, joint stock company, trust, or state or local 
governmental entity.<SUP>33 A sectarian organization is eligible to 
apply, as long as it meets these eligibility requirements. NECET funds 
are available ``to enhance the education of children through the 
creation and production of television programming specifically directed 
toward the development of fundamental intellectual skills.'' <SUP>34 
Presently, in making a NECET grant, NTIA must, as a part of its 
evaluation and review process, review program proposals and 

[[Page 66494]]
content to determine whether it would meet these requirements.

    \32\ 47 U.S.C. 394.
    \33\ 47 U.S.C. 394(i)(2).
    \34\ 47 U.S.C. 394 (a).
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    Accordingly, review under our new policy interpretation will be 
essentially the same as before. The policy will be applied to each 
individual program for which a grant is sought, and the grantee must 
comply with the policy that NTIA grant funds will not be used for 
purposes the essential thrust of which is sectarian.<SUP>35 If the 
essential purpose of a program is to advance or inhibit religion, its 
funding would not be permissible. We do not believe the likelihood of 
entanglement is any greater than it was under our prior policy.

    \35\  Each award will contain a special award condition which 
requires that: ``The grantee will neither use nor allow the NTIA-
funded equipment, facilities or programming to be used for purposes 
the essential thrust of which is sectarian.'' There are often 
special award conditions attached to each award which provide 
conditions on the Federal funds in addition to those required by OMB 
Circulars. As noted above in n. 30, supra, NTIA considers this 
language to mean the same thing as not allowing the NTIA-funded 
equipment, facilities or programming to be used for essentially 
sectarian purposes.
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    Under our prior policy interpretation, if, for example, part of a 
program encompassed a Catholic mass, the entire project would have been 
considered ineligible for funding. In contrast, under the new approach, 
we will make a determination on eligibility based on the test that any 
benefit to a sectarian interest resulting from the receipt of NTIA 
funds must be attenuated or incidental.
3. Telecommunications and Information Infrastructure Assistance Program 
(TIIAP)
    To be eligible for a TIIAP grant, an applicant must be one of the 
following: a state or local government, an accredited college or 
university, or a non-profit entity. Individuals and for-profit 
organizations are not eligible to apply. A sectarian organization is 
eligible to apply, as long as the organization meets these 
requirements. TIIAP funds are provided for the ``planning and 
construction of telecommunications networks for the provision of 
educational, cultural, health care, public information, public safety 
or other social services.'' <SUP>36

    \36\ Pub. L. No. 103-317, 1994 U.S.C.C.A.N. (108 Stat.) 1724, 
1747; 47 U.S.C. Sec. 390-393.
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    In contrast to PTFP, however, where the broadcaster maintains 
editorial control, a TIIAP grantee may sometimes, but not always, 
exercise editorial control over the content of its communications 
network. For example, a network may involve a bulletin board where the 
operator does not have control of messages sent among individuals. In 
some cases, therefore, it could be difficult for a TIIAP applicant to 
certify that facilities will not be used for essentially sectarian 
purposes. Accordingly, TIIAP awards will be subject to the policy which 
requires that the NTIA-funded facilities will not be used for 
essentially sectarian purposes to the extent that the applicant 
controls the content of network communications.<SUP>37

    \37\ The special award condition for the TIIAP awards will read 
as follows: ``During the Federal interest period, to the extent that 
the grantee maintains control over network transmissions, the 
grantee will neither use nor allow the NTIA-funded network to be 
used for purposes the essential thrust of which is sectarian.'' As 
noted in fn. 35, supra, NTIA considers this language to mean the 
same thing as not allowing the NTIA-funded network to be used for 
essentially sectarian purposes.
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    To avoid excessive entanglement in religion, we will not review the 
content of information transmitted over TIIAP-funded networks unless 
NTIA receives a complaint or otherwise becomes aware that an applicant 
or grantee is using NTIA funded equipment or materials in connection 
with sectarian activities. In such instances, rather than examining 
only the questioned activity, NTIA will examine the overall purpose of 
the project to determine whether NTIA funding provides an attenuated or 
incidental benefit to the sectarian interest and thus whether it is 
permissible.
    For example, TIIAP might provide funding to a local organization to 
establish a public computer bulletin board. As part of this bulletin 
board, a church-affiliated youth group might post information regarding 
meetings and meeting times, which includes a meeting time for a worship 
service. Under NTIA's prior policy, this project might have been 
ineligible for funding because the information regarding the sectarian 
meetings and meeting times would have appeared on the network. Applying 
NTIA's new policy interpretation, we would examine the overall purpose 
of the project to determine whether it fell within the TIIAP's 
statutorily authorized purposes and whether any benefit to religion was 
merely incidental or attenuated. If the answer to both questions was 
yes, such a grant would be permissible under the new policy 
interpretation.

IV. Conclusion

    NTIA's modified policy interpretation appropriately harmonizes the 
First Amendment's Free Exercise and Establishment Clauses, consistent 
with current jurisprudence. The new interpretation of our policy 
concerning use of NTIA grant funds in connection with sectarian 
activities will provide grant applicants greater flexibility, while 
continuing to avoid unwarranted government entanglement with religion.

Rulemaking Requirements

    1. It has been determined that this rule is not significant for 
purposes of Executive Order 12866.
    2. Because this rule relates to public property, loans, grants, 
benefits, or contracts, it is exempt from the notice and comment and 
delayed effective date requirements of the Administrative Procedure Act 
(APA).
    3. Because a notice of proposed rulemaking is not required by the 
APA or any other law, a Regulatory Flexibility Analysis is not required 
and was not prepared.
    4. This rule contains information collection requirements subject 
to the provisions of the Paperwork Reduction Act. This collection has 
clearance from the Office of Management and Budget under OMB Approval 
No. 0660-0003.
    5. This policy does not contain policies with federalism 
implications sufficient to warrant preparation of a federalism 
assessment under E.O. 12612.

List of Subjects in 15 CFR Part 2301

    Administrative procedure, Grant programs--communications, Reporting 
and recordkeeping requirements, Telecommunications.

(Catalog of Federal Domestic Assistance No. 11.550)

    Dated: December 15, 1995.
Larry Irving,
Assistant Secretary of Communications and Information.

    For the reasons set out in the preamble, 15 CFR part 2301 is 
amended as follows:

PART 2301--PUBLIC TELECOMMUNICATIONS FACILITIES PROGRAM

    1. The authority for part 2301 continues to read as follows:

    Authority: Public Telecommunications Financing Act of 1978, Pub. 
L. 95-567, 92 Stat. 2405, codified at 47 U.S.C. 390-394, 397-399b; 
the Public Broadcasting Amendments Act of 1981, Pub. L. 97-35, 95 
Stat. 725; the Consolidated Omnibus Budget Reconciliation Act of 
1985, Pub. L. 99-272, section 5001, 100 Stat. 117; and the Public 
Telecommunications Act of 1988, Pub. L. 100-626, 102 Stat. 3207.

    2. Section 2301.1 is amended by revising the definition of public 
telecommunications services to read as follows:


Sec. 2301.1  Definitions.

* * * * *

[[Page 66495]]

    Public telecommunications services means noncommercial educational 
and cultural radio and television programs, and related noncommercial 
instructional or informational material that may be transmitted by 
means of electronic communications.
* * * * *
    3. Section 2301.4(a) is revised to read as follows:


Sec. 2301.4  Eligible organizations and scope of projects.

    (a) Eligible applicants (Construction and Planning Grants). In 
order to apply for and receive a PTFP Construction or Planning Grant, 
an applicant must be:
    (1) A public or noncommercial educational broadcast station;
    (2) A noncommercial telecommunications entity;
    (3) A system of public telecommunications entities;
    (4) A nonprofit foundation, corporation, institution, or 
association organized primarily for educational or cultural purposes; 
or
    (5) A state or local government (or agency thereof), or a political 
or special purpose subdivision of a state.
* * * * *
    4. Section 2301.4 is further amended by removing paragraph (b), 
redesignating paragraph (c) as (b), and revising the newly designated 
paragraph (b) to read as follows:
* * * * *
    (b) Scope of projects. An applicant that is eligible under 
paragraph (a) of this section may file an application with the agency 
for a planning or construction grant to achieve the following:
    (1) The provision of new public telecommunications facilities to 
extend service to areas currently not receiving public 
telecommunications services;
    (2) The expansion of the service areas of existing public 
telecommunications entities;
    (3) The establishment of new public telecommunications entities 
serving areas currently receiving public telecommunications services; 
or
    (4) The improvement of the capabilities of existing licensed public 
broadcast stations to provide public telecommunications services.
* * * * *
    5. Paragraphs (d) through (f) of Sec. 2301.4 are redesignated 
paragraphs (c) through (e) respectively.

[FR Doc. 95-31089 Filed 12-21-95; 8:45 am]
BILLING CODE 3510-60-P