diff --git a/modules/folder/README.md b/modules/folder/README.md
index e1ad6809..fb84ec42 100644
--- a/modules/folder/README.md
+++ b/modules/folder/README.md
@@ -42,40 +42,46 @@ module "folder" {
   name   = "Folder name"
   org_policies = {
     "compute.disableGuestAttributesAccess" = {
-      enforce = true
+      rules = [{ enforce = true }]
     }
     "constraints/compute.skipDefaultNetworkCreation" = {
-      enforce = true
+      rules = [{ enforce = true }]
     }
     "iam.disableServiceAccountKeyCreation" = {
-      enforce = true
+      rules = [{ enforce = true }]
     }
     "iam.disableServiceAccountKeyUpload" = {
-      enforce = false
       rules = [
         {
           condition = {
-            expression  = "resource.matchTagId(\"tagKeys/1234\", \"tagValues/1234\")"
+            expression  = "resource.matchTagId('tagKeys/1234', 'tagValues/1234')"
             title       = "condition"
             description = "test condition"
             location    = "somewhere"
           }
           enforce = true
+        },
+        {
+          enforce = false
         }
       ]
     }
     "constraints/iam.allowedPolicyMemberDomains" = {
-      allow = {
-        values = ["C0xxxxxxx", "C0yyyyyyy"]
-      }
+      rules = [{
+        allow = {
+          values = ["C0xxxxxxx", "C0yyyyyyy"]
+        }
+      }]
     }
     "constraints/compute.trustedImageProjects" = {
-      allow = {
-        values = ["projects/my-project"]
-      }
+      rules = [{
+        allow = {
+          values = ["projects/my-project"]
+        }
+      }]
     }
     "constraints/compute.vmExternalIpAccess" = {
-      deny = { all = true }
+      rules = [{ deny = { all = true } }]
     }
   }
 }
diff --git a/modules/folder/organization-policies.tf b/modules/folder/organization-policies.tf
index 47532f21..2bf79c4a 100644
--- a/modules/folder/organization-policies.tf
+++ b/modules/folder/organization-policies.tf
@@ -1,5 +1,5 @@
 /**
- * Copyright 2022 Google LLC
+ * Copyright 2023 Google LLC
  *
  * Licensed under the Apache License, Version 2.0 (the "License");
  * you may not use this file except in compliance with the License.
@@ -28,16 +28,6 @@ locals {
     k => {
       inherit_from_parent = try(v.inherit_from_parent, null)
       reset               = try(v.reset, null)
-      allow = can(v.allow) ? {
-        all    = try(v.allow.all, null)
-        values = try(v.allow.values, null)
-      } : null
-      deny = can(v.deny) ? {
-        all    = try(v.deny.all, null)
-        values = try(v.deny.values, null)
-      } : null
-      enforce = try(v.enforce, true)
-
       rules = [
         for r in try(v.rules, []) : {
           allow = can(r.allow) ? {
@@ -48,7 +38,7 @@ locals {
             all    = try(r.deny.all, null)
             values = try(r.deny.values, null)
           } : null
-          enforce = try(r.enforce, true)
+          enforce = try(r.enforce, null)
           condition = {
             description = try(r.condition.description, null)
             expression  = try(r.condition.expression, null)
@@ -67,8 +57,9 @@ locals {
     k => merge(v, {
       name   = "${local.folder.name}/policies/${k}"
       parent = local.folder.name
-
-      is_boolean_policy = v.allow == null && v.deny == null
+      is_boolean_policy = (
+        alltrue([for r in v.rules : r.allow == null && r.deny == null])
+      )
       has_values = (
         length(coalesce(try(v.allow.values, []), [])) > 0 ||
         length(coalesce(try(v.deny.values, []), [])) > 0
@@ -90,11 +81,9 @@ resource "google_org_policy_policy" "default" {
   for_each = local.org_policies
   name     = each.value.name
   parent   = each.value.parent
-
   spec {
     inherit_from_parent = each.value.inherit_from_parent
     reset               = each.value.reset
-
     dynamic "rules" {
       for_each = each.value.rules
       iterator = rule
@@ -106,11 +95,14 @@ resource "google_org_policy_policy" "default" {
           ? upper(tostring(rule.value.enforce))
           : null
         )
-        condition {
-          description = rule.value.condition.description
-          expression  = rule.value.condition.expression
-          location    = rule.value.condition.location
-          title       = rule.value.condition.title
+        dynamic "condition" {
+          for_each = rule.value.condition.expression != null ? [1] : []
+          content {
+            description = rule.value.condition.description
+            expression  = rule.value.condition.expression
+            location    = rule.value.condition.location
+            title       = rule.value.condition.title
+          }
         }
         dynamic "values" {
           for_each = rule.value.has_values ? [1] : []
@@ -121,22 +113,5 @@ resource "google_org_policy_policy" "default" {
         }
       }
     }
-
-    rules {
-      allow_all = try(each.value.allow.all, null) == true ? "TRUE" : null
-      deny_all  = try(each.value.deny.all, null) == true ? "TRUE" : null
-      enforce = (
-        each.value.is_boolean_policy && each.value.enforce != null
-        ? upper(tostring(each.value.enforce))
-        : null
-      )
-      dynamic "values" {
-        for_each = each.value.has_values ? [1] : []
-        content {
-          allowed_values = try(each.value.allow.values, null)
-          denied_values  = try(each.value.deny.values, null)
-        }
-      }
-    }
   }
 }
diff --git a/modules/folder/variables.tf b/modules/folder/variables.tf
index a93ea1aa..e0abc612 100644
--- a/modules/folder/variables.tf
+++ b/modules/folder/variables.tf
@@ -1,5 +1,5 @@
 /**
- * Copyright 2022 Google LLC
+ * Copyright 2023 Google LLC
  *
  * Licensed under the Apache License, Version 2.0 (the "License");
  * you may not use this file except in compliance with the License.
@@ -143,19 +143,6 @@ variable "org_policies" {
   type = map(object({
     inherit_from_parent = optional(bool) # for list policies only.
     reset               = optional(bool)
-
-    # default (unconditional) values
-    allow = optional(object({
-      all    = optional(bool)
-      values = optional(list(string))
-    }))
-    deny = optional(object({
-      all    = optional(bool)
-      values = optional(list(string))
-    }))
-    enforce = optional(bool, true) # for boolean policies only.
-
-    # conditional values
     rules = optional(list(object({
       allow = optional(object({
         all    = optional(bool)
@@ -165,13 +152,13 @@ variable "org_policies" {
         all    = optional(bool)
         values = optional(list(string))
       }))
-      enforce = optional(bool, true) # for boolean policies only.
-      condition = object({
+      enforce = optional(bool) # for boolean policies only.
+      condition = optional(object({
         description = optional(string)
         expression  = optional(string)
         location    = optional(string)
         title       = optional(string)
-      })
+      }), {})
     })), [])
   }))
   default  = {}
diff --git a/modules/organization/README.md b/modules/organization/README.md
index b6caa3cd..907cf5f4 100644
--- a/modules/organization/README.md
+++ b/modules/organization/README.md
@@ -25,50 +25,77 @@ module "org" {
   iam_additive_members = {
     "user:compute@example.org" = ["roles/compute.admin", "roles/container.viewer"]
   }
-
+  tags = {
+    allowexternal = {
+      description = "Allow external identities."
+      values = {
+        true = {}, false = {}
+      }
+    }
+  }
   org_policies = {
     "custom.gkeEnableAutoUpgrade" = {
-      enforce = true
+      rules = [{ enforce = true }]
     }
     "compute.disableGuestAttributesAccess" = {
-      enforce = true
+      rules = [{ enforce = true }]
     }
     "constraints/compute.skipDefaultNetworkCreation" = {
-      enforce = true
+      rules = [{ enforce = true }]
     }
     "iam.disableServiceAccountKeyCreation" = {
-      enforce = true
+      rules = [{ enforce = true }]
     }
     "iam.disableServiceAccountKeyUpload" = {
-      enforce = false
       rules = [
         {
           condition = {
-            expression  = "resource.matchTagId(\"tagKeys/1234\", \"tagValues/1234\")"
+            expression  = "resource.matchTagId('tagKeys/1234', 'tagValues/1234')"
             title       = "condition"
             description = "test condition"
             location    = "somewhere"
           }
           enforce = true
+        },
+        {
+          enforce = false
         }
       ]
     }
     "constraints/iam.allowedPolicyMemberDomains" = {
-      allow = {
-        values = ["C0xxxxxxx", "C0yyyyyyy"]
-      }
+      rules = [
+        {
+          allow = { all = true }
+          condition = {
+            expression  = "resource.matchTag('1234567890/allowexternal', 'true')"
+            title       = "Allow external identities"
+            description = "Allow external identities when resource has the `allowexternal` tag set to true."
+          }
+        },
+        {
+          allow = { values = ["C0xxxxxxx", "C0yyyyyyy"] }
+          condition = {
+            expression  = "!resource.matchTag('1234567890/allowexternal', 'true')"
+            title       = ""
+            description = "For any resource without allowexternal=true, only allow identities from restricted domains."
+          }
+        }
+      ]
     }
+
     "constraints/compute.trustedImageProjects" = {
-      allow = {
-        values = ["projects/my-project"]
-      }
+      rules = [{
+        allow = {
+          values = ["projects/my-project"]
+        }
+      }]
     }
     "constraints/compute.vmExternalIpAccess" = {
-      deny = { all = true }
+      rules = [{ deny = { all = true } }]
     }
   }
 }
-# tftest modules=1 resources=13 inventory=basic.yaml
+# tftest modules=1 resources=16 inventory=basic.yaml
 ```
 
 ## IAM
@@ -111,7 +138,7 @@ module "org" {
   # not necessarily to enforce on the org level, policy may be applied on folder/project levels
   org_policies = {
     "custom.gkeEnableAutoUpgrade" = {
-      enforce = true
+      rules = [{ enforce = true }]
     }
   }
 }
@@ -131,7 +158,7 @@ module "org" {
   org_policy_custom_constraints_data_path = "configs/custom-constraints"
   org_policies = {
     "custom.gkeEnableAutoUpgrade" = {
-      enforce = true
+      rules = [{ enforce = true }]
     }
   }
 }
diff --git a/modules/organization/organization-policies.tf b/modules/organization/organization-policies.tf
index 1a99ef9a..b43c5955 100644
--- a/modules/organization/organization-policies.tf
+++ b/modules/organization/organization-policies.tf
@@ -1,5 +1,5 @@
 /**
- * Copyright 2022 Google LLC
+ * Copyright 2023 Google LLC
  *
  * Licensed under the Apache License, Version 2.0 (the "License");
  * you may not use this file except in compliance with the License.
@@ -28,16 +28,6 @@ locals {
     k => {
       inherit_from_parent = try(v.inherit_from_parent, null)
       reset               = try(v.reset, null)
-      allow = can(v.allow) ? {
-        all    = try(v.allow.all, null)
-        values = try(v.allow.values, null)
-      } : null
-      deny = can(v.deny) ? {
-        all    = try(v.deny.all, null)
-        values = try(v.deny.values, null)
-      } : null
-      enforce = try(v.enforce, true)
-
       rules = [
         for r in try(v.rules, []) : {
           allow = can(r.allow) ? {
@@ -48,7 +38,7 @@ locals {
             all    = try(r.deny.all, null)
             values = try(r.deny.values, null)
           } : null
-          enforce = try(r.enforce, true)
+          enforce = try(r.enforce, null)
           condition = {
             description = try(r.condition.description, null)
             expression  = try(r.condition.expression, null)
@@ -67,8 +57,9 @@ locals {
     k => merge(v, {
       name   = "${var.organization_id}/policies/${k}"
       parent = var.organization_id
-
-      is_boolean_policy = v.allow == null && v.deny == null
+      is_boolean_policy = (
+        alltrue([for r in v.rules : r.allow == null && r.deny == null])
+      )
       has_values = (
         length(coalesce(try(v.allow.values, []), [])) > 0 ||
         length(coalesce(try(v.deny.values, []), [])) > 0
@@ -90,11 +81,9 @@ resource "google_org_policy_policy" "default" {
   for_each = local.org_policies
   name     = each.value.name
   parent   = each.value.parent
-
   spec {
     inherit_from_parent = each.value.inherit_from_parent
     reset               = each.value.reset
-
     dynamic "rules" {
       for_each = each.value.rules
       iterator = rule
@@ -106,11 +95,14 @@ resource "google_org_policy_policy" "default" {
           ? upper(tostring(rule.value.enforce))
           : null
         )
-        condition {
-          description = rule.value.condition.description
-          expression  = rule.value.condition.expression
-          location    = rule.value.condition.location
-          title       = rule.value.condition.title
+        dynamic "condition" {
+          for_each = rule.value.condition.expression != null ? [1] : []
+          content {
+            description = rule.value.condition.description
+            expression  = rule.value.condition.expression
+            location    = rule.value.condition.location
+            title       = rule.value.condition.title
+          }
         }
         dynamic "values" {
           for_each = rule.value.has_values ? [1] : []
@@ -121,25 +113,7 @@ resource "google_org_policy_policy" "default" {
         }
       }
     }
-
-    rules {
-      allow_all = try(each.value.allow.all, null) == true ? "TRUE" : null
-      deny_all  = try(each.value.deny.all, null) == true ? "TRUE" : null
-      enforce = (
-        each.value.is_boolean_policy && each.value.enforce != null
-        ? upper(tostring(each.value.enforce))
-        : null
-      )
-      dynamic "values" {
-        for_each = each.value.has_values ? [1] : []
-        content {
-          allowed_values = try(each.value.allow.values, null)
-          denied_values  = try(each.value.deny.values, null)
-        }
-      }
-    }
   }
-
   depends_on = [
     google_organization_iam_audit_config.config,
     google_organization_iam_binding.authoritative,
diff --git a/modules/organization/variables.tf b/modules/organization/variables.tf
index ced5cad3..619056a0 100644
--- a/modules/organization/variables.tf
+++ b/modules/organization/variables.tf
@@ -1,5 +1,5 @@
 /**
- * Copyright 2022 Google LLC
+ * Copyright 2023 Google LLC
  *
  * Licensed under the Apache License, Version 2.0 (the "License");
  * you may not use this file except in compliance with the License.
@@ -183,18 +183,6 @@ variable "org_policies" {
   type = map(object({
     inherit_from_parent = optional(bool) # for list policies only.
     reset               = optional(bool)
-
-    # default (unconditional) values
-    allow = optional(object({
-      all    = optional(bool)
-      values = optional(list(string))
-    }))
-    deny = optional(object({
-      all    = optional(bool)
-      values = optional(list(string))
-    }))
-    enforce = optional(bool, true) # for boolean policies only.
-    # conditional values
     rules = optional(list(object({
       allow = optional(object({
         all    = optional(bool)
@@ -204,13 +192,13 @@ variable "org_policies" {
         all    = optional(bool)
         values = optional(list(string))
       }))
-      enforce = optional(bool, true) # for boolean policies only.
-      condition = object({
+      enforce = optional(bool) # for boolean policies only.
+      condition = optional(object({
         description = optional(string)
         expression  = optional(string)
         location    = optional(string)
         title       = optional(string)
-      })
+      }), {})
     })), [])
   }))
   default  = {}
diff --git a/modules/project/README.md b/modules/project/README.md
index 0cf77df7..dcc0643b 100644
--- a/modules/project/README.md
+++ b/modules/project/README.md
@@ -243,40 +243,46 @@ module "project" {
   prefix          = "foo"
   org_policies = {
     "compute.disableGuestAttributesAccess" = {
-      enforce = true
+      rules = [{ enforce = true }]
     }
     "constraints/compute.skipDefaultNetworkCreation" = {
-      enforce = true
+      rules = [{ enforce = true }]
     }
     "iam.disableServiceAccountKeyCreation" = {
-      enforce = true
+      rules = [{ enforce = true }]
     }
     "iam.disableServiceAccountKeyUpload" = {
-      enforce = false
       rules = [
         {
           condition = {
-            expression  = "resource.matchTagId(\"tagKeys/1234\", \"tagValues/1234\")"
+            expression  = "resource.matchTagId('tagKeys/1234', 'tagValues/1234')"
             title       = "condition"
             description = "test condition"
             location    = "somewhere"
           }
           enforce = true
+        },
+        {
+          enforce = false
         }
       ]
     }
     "constraints/iam.allowedPolicyMemberDomains" = {
-      allow = {
-        values = ["C0xxxxxxx", "C0yyyyyyy"]
-      }
+      rules = [{
+        allow = {
+          values = ["C0xxxxxxx", "C0yyyyyyy"]
+        }
+      }]
     }
     "constraints/compute.trustedImageProjects" = {
-      allow = {
-        values = ["projects/my-project"]
-      }
+      rules = [{
+        allow = {
+          values = ["projects/my-project"]
+        }
+      }]
     }
     "constraints/compute.vmExternalIpAccess" = {
-      deny = { all = true }
+      rules = [{ deny = { all = true } }]
     }
   }
 }
@@ -306,36 +312,42 @@ module "project" {
 ```yaml
 # tftest-file id=boolean path=configs/org-policies/boolean.yaml
 compute.disableGuestAttributesAccess:
-  enforce: true
+  rules:
+  - enforce: true
 constraints/compute.skipDefaultNetworkCreation:
-  enforce: true
+  rules:
+  - enforce: true
 iam.disableServiceAccountKeyCreation:
-  enforce: true
+  rules:
+  - enforce: true
 iam.disableServiceAccountKeyUpload:
-  enforce: false
   rules:
   - condition:
       description: test condition
-      expression: resource.matchTagId("tagKeys/1234", "tagValues/1234")
+      expression: resource.matchTagId('tagKeys/1234', 'tagValues/1234')
       location: somewhere
       title: condition
     enforce: true
+  - enforce: false
 ```
 
 ```yaml
 # tftest-file id=list path=configs/org-policies/list.yaml
 constraints/compute.trustedImageProjects:
-  allow:
-    values:
-    - projects/my-project
+  rules:
+  - allow:
+      values:
+      - projects/my-project
 constraints/compute.vmExternalIpAccess:
-  deny:
-    all: true
+  rules:
+  - deny:
+      all: true
 constraints/iam.allowedPolicyMemberDomains:
-  allow:
-    values:
-    - C0xxxxxxx
-    - C0yyyyyyy
+  rules:
+  - allow:
+      values:
+      - C0xxxxxxx
+      - C0yyyyyyy
 ```
 
 
diff --git a/modules/project/organization-policies.tf b/modules/project/organization-policies.tf
index 4ff5bb99..37e6f253 100644
--- a/modules/project/organization-policies.tf
+++ b/modules/project/organization-policies.tf
@@ -1,5 +1,5 @@
 /**
- * Copyright 2022 Google LLC
+ * Copyright 2023 Google LLC
  *
  * Licensed under the Apache License, Version 2.0 (the "License");
  * you may not use this file except in compliance with the License.
@@ -28,16 +28,6 @@ locals {
     k => {
       inherit_from_parent = try(v.inherit_from_parent, null)
       reset               = try(v.reset, null)
-      allow = can(v.allow) ? {
-        all    = try(v.allow.all, null)
-        values = try(v.allow.values, null)
-      } : null
-      deny = can(v.deny) ? {
-        all    = try(v.deny.all, null)
-        values = try(v.deny.values, null)
-      } : null
-      enforce = try(v.enforce, true)
-
       rules = [
         for r in try(v.rules, []) : {
           allow = can(r.allow) ? {
@@ -48,7 +38,7 @@ locals {
             all    = try(r.deny.all, null)
             values = try(r.deny.values, null)
           } : null
-          enforce = try(r.enforce, true)
+          enforce = try(r.enforce, null)
           condition = {
             description = try(r.condition.description, null)
             expression  = try(r.condition.expression, null)
@@ -67,8 +57,9 @@ locals {
     k => merge(v, {
       name   = "projects/${local.project.project_id}/policies/${k}"
       parent = "projects/${local.project.project_id}"
-
-      is_boolean_policy = v.allow == null && v.deny == null
+      is_boolean_policy = (
+        alltrue([for r in v.rules : r.allow == null && r.deny == null])
+      )
       has_values = (
         length(coalesce(try(v.allow.values, []), [])) > 0 ||
         length(coalesce(try(v.deny.values, []), [])) > 0
@@ -90,11 +81,9 @@ resource "google_org_policy_policy" "default" {
   for_each = local.org_policies
   name     = each.value.name
   parent   = each.value.parent
-
   spec {
     inherit_from_parent = each.value.inherit_from_parent
     reset               = each.value.reset
-
     dynamic "rules" {
       for_each = each.value.rules
       iterator = rule
@@ -106,11 +95,14 @@ resource "google_org_policy_policy" "default" {
           ? upper(tostring(rule.value.enforce))
           : null
         )
-        condition {
-          description = rule.value.condition.description
-          expression  = rule.value.condition.expression
-          location    = rule.value.condition.location
-          title       = rule.value.condition.title
+        dynamic "condition" {
+          for_each = rule.value.condition.expression != null ? [1] : []
+          content {
+            description = rule.value.condition.description
+            expression  = rule.value.condition.expression
+            location    = rule.value.condition.location
+            title       = rule.value.condition.title
+          }
         }
         dynamic "values" {
           for_each = rule.value.has_values ? [1] : []
@@ -121,22 +113,5 @@ resource "google_org_policy_policy" "default" {
         }
       }
     }
-
-    rules {
-      allow_all = try(each.value.allow.all, null) == true ? "TRUE" : null
-      deny_all  = try(each.value.deny.all, null) == true ? "TRUE" : null
-      enforce = (
-        each.value.is_boolean_policy && each.value.enforce != null
-        ? upper(tostring(each.value.enforce))
-        : null
-      )
-      dynamic "values" {
-        for_each = each.value.has_values ? [1] : []
-        content {
-          allowed_values = try(each.value.allow.values, null)
-          denied_values  = try(each.value.deny.values, null)
-        }
-      }
-    }
   }
 }
diff --git a/modules/project/variables.tf b/modules/project/variables.tf
index 3769a1fb..ede3a8c6 100644
--- a/modules/project/variables.tf
+++ b/modules/project/variables.tf
@@ -1,5 +1,5 @@
 /**
- * Copyright 2022 Google LLC
+ * Copyright 2023 Google LLC
  *
  * Licensed under the Apache License, Version 2.0 (the "License");
  * you may not use this file except in compliance with the License.
@@ -147,19 +147,6 @@ variable "org_policies" {
   type = map(object({
     inherit_from_parent = optional(bool) # for list policies only.
     reset               = optional(bool)
-
-    # default (unconditional) values
-    allow = optional(object({
-      all    = optional(bool)
-      values = optional(list(string))
-    }))
-    deny = optional(object({
-      all    = optional(bool)
-      values = optional(list(string))
-    }))
-    enforce = optional(bool, true) # for boolean policies only.
-
-    # conditional values
     rules = optional(list(object({
       allow = optional(object({
         all    = optional(bool)
@@ -169,13 +156,13 @@ variable "org_policies" {
         all    = optional(bool)
         values = optional(list(string))
       }))
-      enforce = optional(bool, true) # for boolean policies only.
-      condition = object({
+      enforce = optional(bool) # for boolean policies only.
+      condition = optional(object({
         description = optional(string)
         expression  = optional(string)
         location    = optional(string)
         title       = optional(string)
-      })
+      }), {})
     })), [])
   }))
   default  = {}
diff --git a/tests/modules/folder/examples/org-policies.yaml b/tests/modules/folder/examples/org-policies.yaml
index f8bf4187..7d2637ea 100644
--- a/tests/modules/folder/examples/org-policies.yaml
+++ b/tests/modules/folder/examples/org-policies.yaml
@@ -1,4 +1,4 @@
-# Copyright 2022 Google LLC
+# Copyright 2023 Google LLC
 #
 # Licensed under the Apache License, Version 2.0 (the "License");
 # you may not use this file except in compliance with the License.
@@ -91,7 +91,7 @@ values:
       - allow_all: null
         condition:
         - description: test condition
-          expression: resource.matchTagId("tagKeys/1234", "tagValues/1234")
+          expression: resource.matchTagId('tagKeys/1234', 'tagValues/1234')
           location: somewhere
           title: condition
         deny_all: null
diff --git a/tests/modules/folder/org_policies_boolean.tfvars b/tests/modules/folder/org_policies_boolean.tfvars
index eceafe6d..cf5047a2 100644
--- a/tests/modules/folder/org_policies_boolean.tfvars
+++ b/tests/modules/folder/org_policies_boolean.tfvars
@@ -1,9 +1,8 @@
 org_policies = {
   "iam.disableServiceAccountKeyCreation" = {
-    enforce = true
+    rules = [{ enforce = true }]
   }
   "iam.disableServiceAccountKeyUpload" = {
-    enforce = false
     rules = [
       {
         condition = {
@@ -13,6 +12,9 @@ org_policies = {
           location    = "xxx"
         }
         enforce = true
+      },
+      {
+        enforce = false
       }
     ]
   }
diff --git a/tests/modules/folder/org_policies_list.tfvars b/tests/modules/folder/org_policies_list.tfvars
index 73807173..2c83de47 100644
--- a/tests/modules/folder/org_policies_list.tfvars
+++ b/tests/modules/folder/org_policies_list.tfvars
@@ -1,14 +1,15 @@
 org_policies = {
   "compute.vmExternalIpAccess" = {
-    deny = { all = true }
+    rules = [{ deny = { all = true } }]
   }
   "iam.allowedPolicyMemberDomains" = {
-    allow = {
-      values = ["C0xxxxxxx", "C0yyyyyyy"]
-    }
+    rules = [{
+      allow = {
+        values = ["C0xxxxxxx", "C0yyyyyyy"]
+      }
+    }]
   }
   "compute.restrictLoadBalancerCreationForTypes" = {
-    deny = { values = ["in:EXTERNAL"] }
     rules = [
       {
         condition = {
@@ -31,6 +32,9 @@ org_policies = {
         allow = {
           all = true
         }
+      },
+      {
+        deny = { values = ["in:EXTERNAL"] }
       }
     ]
   }
diff --git a/tests/modules/organization/examples/basic.yaml b/tests/modules/organization/examples/basic.yaml
index f7b63a1d..a751622d 100644
--- a/tests/modules/organization/examples/basic.yaml
+++ b/tests/modules/organization/examples/basic.yaml
@@ -71,8 +71,23 @@ values:
     - inherit_from_parent: null
       reset: null
       rules:
+      - allow_all: 'TRUE'
+        condition:
+        - description: Allow external identities when resource has the `allowexternal`
+            tag set to true.
+          expression: resource.matchTag('1234567890/allowexternal', 'true')
+          location: null
+          title: Allow external identities
+        deny_all: null
+        enforce: null
+        values: []
       - allow_all: null
-        condition: []
+        condition:
+        - description: For any resource without allowexternal=true, only allow identities
+            from restricted domains.
+          expression: '!resource.matchTag(''1234567890/allowexternal'', ''true'')'
+          location: null
+          title: ''
         deny_all: null
         enforce: null
         values:
@@ -102,7 +117,7 @@ values:
       - allow_all: null
         condition:
         - description: test condition
-          expression: resource.matchTagId("tagKeys/1234", "tagValues/1234")
+          expression: resource.matchTagId('tagKeys/1234', 'tagValues/1234')
           location: somewhere
           title: condition
         deny_all: null
@@ -141,6 +156,20 @@ values:
     member: user:compute@example.org
     org_id: '1234567890'
     role: roles/container.viewer
+  module.org.google_tags_tag_key.default["allowexternal"]:
+    description: Allow external identities.
+    parent: organizations/1234567890
+    purpose: null
+    purpose_data: null
+    short_name: allowexternal
+  module.org.google_tags_tag_value.default["allowexternal/false"]:
+    short_name: 'false'
+  module.org.google_tags_tag_value.default["allowexternal/true"]:
+    short_name: 'true'
+
 counts:
   google_org_policy_policy: 8
   google_organization_iam_binding: 3
+  google_organization_iam_member: 2
+  google_tags_tag_key: 1
+  google_tags_tag_value: 2
diff --git a/tests/modules/organization/org_policies_boolean.tfvars b/tests/modules/organization/org_policies_boolean.tfvars
index eceafe6d..cd0f032c 100644
--- a/tests/modules/organization/org_policies_boolean.tfvars
+++ b/tests/modules/organization/org_policies_boolean.tfvars
@@ -1,9 +1,9 @@
 org_policies = {
   "iam.disableServiceAccountKeyCreation" = {
-    enforce = true
+    rules = [{ enforce = true }]
   }
   "iam.disableServiceAccountKeyUpload" = {
-    enforce = false
+
     rules = [
       {
         condition = {
@@ -13,6 +13,9 @@ org_policies = {
           location    = "xxx"
         }
         enforce = true
+      },
+      {
+        enforce = false
       }
     ]
   }
diff --git a/tests/modules/organization/org_policies_list.tfvars b/tests/modules/organization/org_policies_list.tfvars
index f9de8dba..d03f8530 100644
--- a/tests/modules/organization/org_policies_list.tfvars
+++ b/tests/modules/organization/org_policies_list.tfvars
@@ -1,15 +1,17 @@
 org_policies = {
   "compute.vmExternalIpAccess" = {
-    deny = { all = true }
+    rules = [{ deny = { all = true } }]
   }
   "iam.allowedPolicyMemberDomains" = {
     inherit_from_parent = true
-    allow = {
-      values = ["C0xxxxxxx", "C0yyyyyyy"]
-    }
+    rules = [{
+      allow = {
+        values = ["C0xxxxxxx", "C0yyyyyyy"]
+      }
+    }]
+
   }
   "compute.restrictLoadBalancerCreationForTypes" = {
-    deny = { values = ["in:EXTERNAL"] }
     rules = [
       {
         condition = {
@@ -32,6 +34,9 @@ org_policies = {
         allow = {
           all = true
         }
+      },
+      {
+        deny = { values = ["in:EXTERNAL"] }
       }
     ]
   }
diff --git a/tests/modules/organization/test_plan_org_policies_modules.py b/tests/modules/organization/test_plan_org_policies_modules.py
index 1d19ee1e..30881d99 100644
--- a/tests/modules/organization/test_plan_org_policies_modules.py
+++ b/tests/modules/organization/test_plan_org_policies_modules.py
@@ -1,4 +1,4 @@
-# Copyright 2022 Google LLC
+# Copyright 2023 Google LLC
 #
 # Licensed under the Apache License, Version 2.0 (the "License");
 # you may not use this file except in compliance with the License.
@@ -26,61 +26,35 @@ def test_policy_implementation():
     path = modules_path / module / 'organization-policies.tf'
     lines[module] = path.open().readlines()
 
-  diff1 = difflib.unified_diff(lines['project'], lines['folder'])
+  diff1 = difflib.unified_diff(lines['project'], lines['folder'], 'project',
+                               'folder', n=0)
   assert list(diff1) == [
-      '--- \n',
-      '+++ \n',
-      '@@ -14,7 +14,7 @@\n',
-      '  * limitations under the License.\n',
-      '  */\n',
-      ' \n',
+      '--- project\n',
+      '+++ folder\n',
+      '@@ -17 +17 @@\n',
       '-# tfdoc:file:description Project-level organization policies.\n',
       '+# tfdoc:file:description Folder-level organization policies.\n',
-      ' \n',
-      ' locals {\n',
-      '   _factory_data_raw = merge([\n',
-      '@@ -65,8 +65,8 @@\n',
-      '   org_policies = {\n',
-      '     for k, v in local._org_policies :\n',
-      '     k => merge(v, {\n',
+      '@@ -58,2 +58,2 @@\n',
       '-      name   = "projects/${local.project.project_id}/policies/${k}"\n',
       '-      parent = "projects/${local.project.project_id}"\n',
       '+      name   = "${local.folder.name}/policies/${k}"\n',
       '+      parent = local.folder.name\n',
-      ' \n',
-      '       is_boolean_policy = v.allow == null && v.deny == null\n',
-      '       has_values = (\n',
   ]
 
-  diff2 = difflib.unified_diff(lines['folder'], lines['organization'])
+  diff2 = difflib.unified_diff(lines['folder'], lines['organization'], 'folder',
+                               'organization', n=0)
   assert list(diff2) == [
-      '--- \n',
-      '+++ \n',
-      '@@ -14,7 +14,7 @@\n',
-      '  * limitations under the License.\n',
-      '  */\n',
-      ' \n',
+      '--- folder\n',
+      '+++ organization\n',
+      '@@ -17 +17 @@\n',
       '-# tfdoc:file:description Folder-level organization policies.\n',
       '+# tfdoc:file:description Organization-level organization policies.\n',
-      ' \n',
-      ' locals {\n',
-      '   _factory_data_raw = merge([\n',
-      '@@ -65,8 +65,8 @@\n',
-      '   org_policies = {\n',
-      '     for k, v in local._org_policies :\n',
-      '     k => merge(v, {\n',
+      '@@ -58,2 +58,2 @@\n',
       '-      name   = "${local.folder.name}/policies/${k}"\n',
       '-      parent = local.folder.name\n',
       '+      name   = "${var.organization_id}/policies/${k}"\n',
       '+      parent = var.organization_id\n',
-      ' \n',
-      '       is_boolean_policy = v.allow == null && v.deny == null\n',
-      '       has_values = (\n',
-      '@@ -139,4 +139,13 @@\n',
-      '       }\n',
-      '     }\n',
-      '   }\n',
-      '+\n',
+      '@@ -116,0 +117,8 @@\n',
       '+  depends_on = [\n',
       '+    google_organization_iam_audit_config.config,\n',
       '+    google_organization_iam_binding.authoritative,\n',
@@ -89,5 +63,4 @@ def test_policy_implementation():
       '+    google_organization_iam_policy.authoritative,\n',
       '+    google_org_policy_custom_constraint.constraint,\n',
       '+  ]\n',
-      ' }\n',
   ]
diff --git a/tests/modules/project/examples/org-policies.yaml b/tests/modules/project/examples/org-policies.yaml
index 8841dede..a426696b 100644
--- a/tests/modules/project/examples/org-policies.yaml
+++ b/tests/modules/project/examples/org-policies.yaml
@@ -1,4 +1,4 @@
-# Copyright 2022 Google LLC
+# Copyright 2023 Google LLC
 #
 # Licensed under the Apache License, Version 2.0 (the "License");
 # you may not use this file except in compliance with the License.
@@ -102,7 +102,7 @@ values:
       - allow_all: null
         condition:
         - description: test condition
-          expression: resource.matchTagId("tagKeys/1234", "tagValues/1234")
+          expression: resource.matchTagId('tagKeys/1234', 'tagValues/1234')
           location: somewhere
           title: condition
         deny_all: null
diff --git a/tests/modules/project/org_policies_boolean.tfvars b/tests/modules/project/org_policies_boolean.tfvars
index eceafe6d..cf5047a2 100644
--- a/tests/modules/project/org_policies_boolean.tfvars
+++ b/tests/modules/project/org_policies_boolean.tfvars
@@ -1,9 +1,8 @@
 org_policies = {
   "iam.disableServiceAccountKeyCreation" = {
-    enforce = true
+    rules = [{ enforce = true }]
   }
   "iam.disableServiceAccountKeyUpload" = {
-    enforce = false
     rules = [
       {
         condition = {
@@ -13,6 +12,9 @@ org_policies = {
           location    = "xxx"
         }
         enforce = true
+      },
+      {
+        enforce = false
       }
     ]
   }
diff --git a/tests/modules/project/org_policies_list.tfvars b/tests/modules/project/org_policies_list.tfvars
index f9de8dba..617c5bf0 100644
--- a/tests/modules/project/org_policies_list.tfvars
+++ b/tests/modules/project/org_policies_list.tfvars
@@ -1,15 +1,17 @@
 org_policies = {
   "compute.vmExternalIpAccess" = {
-    deny = { all = true }
+    rules = [{ deny = { all = true } }]
   }
   "iam.allowedPolicyMemberDomains" = {
     inherit_from_parent = true
-    allow = {
-      values = ["C0xxxxxxx", "C0yyyyyyy"]
-    }
+    rules = [{
+      allow = {
+        values = ["C0xxxxxxx", "C0yyyyyyy"]
+      }
+    }]
   }
   "compute.restrictLoadBalancerCreationForTypes" = {
-    deny = { values = ["in:EXTERNAL"] }
+
     rules = [
       {
         condition = {
@@ -32,6 +34,9 @@ org_policies = {
         allow = {
           all = true
         }
+      },
+      {
+        deny = { values = ["in:EXTERNAL"] }
       }
     ]
   }