Tax Exempt Religious Schools Under Attack: Conflicting Goals of Religious Freedom and Racial Integration

Fordham Law Review Volume 48 | Issue 3 Article 1 1979 Tax Exempt Religious Schools Under Attack: Conflicting Goals of Religious Freedom and Racial Integration Thomas Stephen Neuberger Thomas C. Crumplar Recommended Citation Thomas Stephen Neuberger and Thomas C. Crumplar, Tax Exempt Religious Schools Under Attack: Conflicting Goals of Religious Freedom and Racial Integration , 48 Fordham L. Rev. 229 (1979). Available at: http://ir.lawnet.fordham.edu/flr/vol48/iss3/1 This Article is brought to you for free and open access by FLASH: The Fordham Law Archive of Scholarship and History. It has been accepted for inclusion in Fordham Law Review by an authorized editor of FLASH: The Fordham Law Archive of Scholarship and History. For more information, please contact . TAX EXEMPT RELIGIOUS SCHOOLS UNDER ATTACK: CONFLICTING GOALS OF RELIGIOUS FREEDOM AND RACIAL INTEGRATION THOMAS STEPHEN NEUBERGER* THOMAS C. CRUMPLAR** TABLE OF CONTENTS INTRODUCTION ......................................................... I. THE REVISED PROPOSED REVENUE PROCEDURE ............................... T1. IRS AUTHORITY ...................................................... A. Section 501(c)(3) and the Common Law of Charitable Organizations ....... B. Tax Exemptions and Public Policy ..................................... 1. The Public Policy Limitation ........................................ C. Tax Expenditure as Governmental Action .............................. III. PROOF OF RACIAL DISCRIMINATION ......................................... A. Discriminatory Motive and the Order of Proof .......................... B. Problem Areas in the Revised Revenue Procedure ....................... 1. The Method and Allocation of Proof ................................. 2. Failure to Require Discriminatory Motive or Purpose .................. 3. The Use of Statistics ............................................... 4. The Exclusion of Testimonial Proof .................................. 250 252 252 253 253 257 IV. 258 THE FIRST AMIENDMENT RELIGION A. B. C. D. CLAUSES ..................................... The ,Religious School ................................................. The Religion Clauses .................................................. 1. The Establishment Clause .......................................... a. Primary Effect .................................................. b. Excessive Entanglement .......................................... 2. The Free Exercise Clause ........................................... a. Religious Liberty .............................................. b. The Impact Upon Religious Practice .............................. c. Counterbalancing Compelling State Interests ....................... Potential Consequences in Adopting the Revenue Procedure ............... A Narrowly Drawn State Interest ...................................... CONCLUSION .............................................................. * 230 234 236 237 240 241 244 248 259 260 261 262 263 265 266 268 270 272 273 275 Member of the Delaware Bar. B.A. 1969, St. Joseph's College; M.A. 1973, University of Delaware; J.D. 1974, Georgetown University. Mr. Neuberger's practice is centered on first and fourteenth amendment litigation. He is a partner with the law firm of Bader, Dorsey & Kreshtool, Wilmington, Del. ** Member of the Delaware and Kentucky Bars. B.A. 1971, University of Michigan; J.D. 1975, University of Virginia. Mr. Crumplar has written and lectured on tax exempt organizations, and practices in both the tax and general civil litigation areas. He is associated with the law firm of Bader, Dorsey & Kreshtool, Wilmington, Del. FORDHAM LAW REVIEW [Vol. 48 INTRODUCTION T HE religious school is a venerable American institution that antedates the public school by many years.' In addition to providing education, religious schools have preserved the integrity and identity of religious groups whose members have sought to prevent their children's minds from being shaped by forces contrary to their faith. 2 In recent years, with the advent of what many parents view as conscious3 hostility toward religion and religious values in the public schools, and with the perceived concomitant growth of secular humanism in those schools, 4 religious parents, in increasing numbers, have been removing their children from public schools and placing them in newly created or expanded religious schools. 5 This movement has been accompanied by a growing number of lawsuits testing the government's right to regulate or impose standards on religious schools in the areas of, for example, curriculum, 6 labor relations, 7 unemployment insurance 8 and zoning. 9 In the twenty-five years since Brown v. Board of Education, 10 the United States has also begun the long-delayed fulfillment of its prom1. See generally 0. Krauschaar, Private Schools from the Puritans to the Present (1976). 2. See, e.g., Wisconsin v. Yoder, 406 U.S. 205 (1972) (Amish); Pierce v. Society of Sisters, 268 U.S. 510 (1925) (Roman Catholics); Meyer v. Nebraska, 262 U.S. 390 (1923) (German Lutherans). As the Supreme Court noted in Yoder, 406 U.S. at 216, there is biblical authority for this position: "[Ble not conformed to this world: but be ye transformed by the renewing of your mind .... ." Romans 12:2 (King James) (footnotes omitted). 3. This perceived hostility can be seen in the highly publicized decisions in which the Supreme Court held mandatory school prayer programs to be unconstitutional. Abington Township School Dist. v. Schempp, 374 U.S. 203 (1963); Engel v. Vitale, 370 U.S. 421 (1962). Courts have also attempted to limit voluntary student-initiated extracurricular religious activities. See, e.g., Johnson v. Huntington Beach Union High School Dist., 68 Cal. App. 3d 1, 137 Cal. Rptr. 43, cert. denied, 434 U.S. 877 (1977); Keegan v. University of Del., 349 A.2d 14 (Del. 1975), cert. denied, 424 U.S. 934 (1976). 4. See generally A. Grover, Ohio's Trojan Horse 41-55 (1977); Whitehead & Conlan, The Establishment of the Religion of Secular Humanism and Its First Amendment Implications, 10 Tex. Tech L. Rev. 1 (1978). The doctrine of secular humanism "worships Man as the source of all knowledge and truth, whereas theism worships God as the source of all knowledge and truth." Id. at 30-31. According to Messrs. Whitehead and Conlan, the purpose of secular humanism Is to eliminate "traditional theism from the arena of public discourse and American institutional life." Id. at 1. 5. See Tax-Exempt Status of Private Schools: Hearings Before the Subcomm. on Oversight of the House Comm. on Ways and Means, 96th Cong., 1st Sess. 1049 (1979) [hereinafter cited as Hearings] (statement of Louis Wilson Ingram, Jr.). 6. State v. Whisner, 47 Ohio St. 2d 181, 351 N.E.2d 750 (1976). 7. NLRB v. Catholic Bishop, 440 U.S. 490 (1979) 8. Grace Brethren Church v. California, No. 79-93 (C.D. Cal. Sept. 24, 1979). 9. City of Concord v. New Testament Baptist Church, 118 (...truncated)