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Shifting Boundaries: The Establishment Clause and Government Funding of Religious Schools and Other Faith-Based Organizations

Funding for Faith-Based Social Services

The standard laid out by O’Connor in Mitchell dramatically increased the government’s options for partnering with religious groups. For example, in 2001, prompted in part by the Mitchell ruling, President George W. Bush announced his faith-based initiative, which sought to eliminate all federal policies that disqualified religious groups from participating in social welfare programs.

So far, the faith-based initiative has faced one challenge in the Supreme Court. That case, Hein v. Freedom from Religion Foundation (2007), focused on the question of whether taxpayers have legal standing (the right to sue) to challenge the government’s funding of religion solely because they pay taxes. In the Hein case, a church-state watchdog group alleged that various federal executive agencies had violated the Establishment Clause by using tax dollars to promote the faith-based initiative. The group argued that it had standing to bring the suit because its members paid taxes. But the court dismissed the suit by a 5-4 vote, reasoning that taxpayer standing applies only when the legislative branch specifically authorizes the use of tax dollars for religious institutions or purposes, not when the executive branch uses discretionary dollars without that legislative authority.

Even after the Hein decision, however, taxpayers still have standing in federal courts to challenge government funding of religion if the legislature has specifically authorized grants to religious entities. For example, in Americans United for Separation of Church and State v. Prison Fellowship Ministries (2007), the 8th U.S. Circuit Court of Appeals ruled that a church-state watchdog group had standing to challenge a faith-based organization’s provision of rehabilitative services because the state legislature specifically appropriated tax dollars to fund these services. Moreover, the court also held that the Prison Fellowship Ministries’ use of religious instruction and worship in providing these services violated the Establishment Clause. The court explained that while the Mitchell ruling permitted direct government funding of a religious organization’s secular activities, the ruling still prohibited direct public funding of religious activities.

The Mitchell standard is often difficult to apply to individual controversies. For example, if a group offers both secular social welfare services and religious instruction, it is unclear under the Mitchell standard whether the government may finance the group’s overhead expenses, such as renting an office or photocopier. Similarly, it is unclear whether the government may pay a counselor who uses both secular and religious messages to help people suffering from substance abuse. The answers to these questions depend on the particular facts of the case, and turn on whether there is some assurance that the recipient of federal funding has actually segregated that funding from the group’s religious programs. But courts continue to face difficult questions in determining precisely how much government monitoring and auditing the Mitchell standard requires.

Just as the Mitchell ruling eventually cleared the way for Bush’s faith-based initiative, the ruling might also prove significant for President Barack Obama, who in February 2009 announced his own faith-based initiative. Although Obama’s new White House Office of Faith-Based and Neighborhood Partnerships plans to broaden the scope of church-state partnerships, it is similar to its predecessor in many ways. As with Bush’s faith-based office, Obama’s initiative plans to promote greater involvement of faith-based organizations in federal social welfare programs. In addition, Obama has surprised many observers by not immediately overturning the Bush administration’s policy that religious groups may consider potential employees’ religion when making hiring decisions, even when those groups receive federal funding. This has come as a surprise to many because during the presidential campaign Obama made statements suggesting that he might change the policy to prohibit all recipients of federal aid from hiring on the basis of faith. But in announcing the creation of his faith-based office, Obama retreated from this stance and said that his administration would instead take on the faith-based hiring issue on a case-by-case basis, consulting with the Department of Justice to determine when, if ever, it is permissible for a religious recipient of federal aid to hire on the basis of faith. (See the Pew Forum’s Q & A Faith-Based Hiring and the Obama Administration.)

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