Evaluating Federal Financial Assistance Under
September 9, 2020
the Constitution’s Religion Clauses
Valerie C. Brannon
Federal and state governments have long offered support to religious organizations in the form of
Legislative Attorney
tax exemptions, the provision of general services, or more targeted assistance such as lending

textbooks or providing construction funds to religiously affiliated schools. And, conversely,
governments concerned about the separation of church and state have imposed restrictions to

prevent government funds from aiding religious entities. As the Supreme Court has recognized,
however, special constitutional concerns are raised both when the government provides money to religious organizations and
when it excludes religious entities from general aid programs.
Government funding and non-funding of religious institutions implicates both of the U.S. Constitution’s two Religion
Clauses. First, the Establishment Clause, which bars the government from making any “law respecting an establishment of
religion,” has been interpreted to limit the government’s ability to fund religious activities. Second, the Supreme Court has
held that the Free Exercise Clause, which bars the government from making a law “prohibiting the free exercise” of religion,
restricts the government’s ability to exclude religious entities from public programs. Between these two provisions, as the
Supreme Court recognized in Walz v. Tax Commission, there is “room for play in the joints productive of a benevolent
neutrality which will permit religious exercise to exist without sponsorship and without interference.”
Although the Supreme Court’s Establishment Clause jurisprudence has shifted over the years, the Court has frequently
analyzed cases challenging the provision of funds to religious organizations under the three-part Lemon test. This three-part
analysis asks courts to ensure that the government has a secular purpose in offering the funds, that the primary effect of th e
funds neither advances nor inhibits religion, and that the program does not foster excessive government entanglement with
religion. The Supreme Court has upheld direct aid programs that satisfy this test, particularly where there is no risk that
public funds will be used for religious indoctrination. Applying this test, the Court has also upheld indirect aid programs such
as school voucher programs that provide funds to third parties who may independently choose to direct that money to
religious organizations.
But while the Court has recognized that some restrictions on public funds may be necessary to ensure that a program does not
violate the Establishment Clause, in other circumstances, the Supreme Court has held that the government violates the Free
Exercise Clause by excluding religious organizations from generally available programs. While the Court has allowed the
government to prohibit the religious use of funds, the government may not discriminate based on the religious character or
status of an organization.
A number of federal statutes and regulations govern the provision of federal funds to religious organizations. Recently,
however, the executive branch has taken the position that some of these federal laws are no longer consistent with governing
constitutional principles, particularly in light of more recent Supreme Court precedent such as Trinity Lutheran Church of
Columbia, Inc. v. Comer and Espinoza v. Montana Department of Revenue. In Trinity Lutheran, the Court held that excluding
religious organizations from public benefits programs can violate the Free Exercise Clause by impermissibly discriminating
against religion. If Congress agreed with the executive branch, it could amend federal statutes to eliminate any problematic
funding restrictions. The Supreme Court has not specifically ruled on the constitutionality of most of these federal laws,
however, and its Establishment Clause cases suggest that at least some restrictions on the use of federal funds for religious
activities may be constitutionally required. While Congress cannot alter the scope of the Free Exercise Clause’s protections
for religious entities, it can grant additional statutory protections to religious entities, so long as those protections do not rise
to the level of an unconstitutional establishment. Similarly, although Congress cannot amend the scope of the Establishment
Clause’s restrictions on public support for religious activities, it may create statutory restrictions on the religious use of funds,
so long as those restrictions do not violate the Free Exercise Clause.
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Evaluating Federal Financial Assistance Under the Constitution’s Religion Clauses

he Religion Clauses in the First Amendment of the U.S. Constitution provide that the
government “shal make no law respecting an establishment of religion, or prohibiting the
T free exercise thereof.”1 The first provision, the Establishment Clause, bars the government
from providing certain types of support for religion.2 The government would violate the
Establishment Clause by establishing an official national religion, but might also violate this
provision by otherwise supporting or becoming actively involved in religious activities.3 The Free
Exercise Clause, by contrast, prohibits government hostility to religion, requiring the government
to act in a way that is “neutral toward . . . religious beliefs.”4
Providing government funds or other aid to religious institutions implicates both the Religion
Clauses, as the Supreme Court explained in the foundational 1947 case Everson v. Board of
Education.5 The Everson opinion considered the constitutionality of a state program that
reimbursed parents for bus fare to send their children to school, including children who attended
parochial schools.6 Ultimately, the Court held that the program did not violate the Establishment
Clause even though it used “tax-raised funds” to help some children “get to church schools.”7 The
Court noted a tension between the two Religion Clauses as applied to the case.8 The
Establishment Clause prohibited the state from contributing public funds to support “an
institution which teaches the tenets and faith of any church,” while the Free Exercise Clause
prohibited the state from excluding religious individuals “from receiving the benefits of public
welfare legislation” because of their faith.9 Balancing these two principles, the Court said that in
“protecting” citizens from “state-established churches,” it did not want to “inadvertently prohibit
[the state] from extending its general state law benefits to al its citizens without regard to their
religious belief.”10 Everson provided a blueprint for much of the Court’s subsequent
jurisprudence on constitutional limitations on public aid.
In its cases interpreting the First Amendment, the Court has required the government to remain
“neutral in its relations with groups of religious believers and non-believers,” and has said that the
government may neither favor nor disfavor religious entities.11 Thus, the Supreme Court has
recognized that there “is room for play in the joints” between the two Religion Clauses, al owing
the government to display “a benevolent neutrality” that “wil permit religious exercise to exist
without sponsorship and without interference.”12 And just as the government may provide some

1 U.S. CONST. amend. I. T he text of the First Amendment actually provides that “ Congress shall make no law,” but the
provision was “made applicable to the states” by the Fourteenth Amendment. Everson v. Bd. of Educ., 330 U.S. 1, 5
(1947). Further, it has long been understood to restrict action by the executive branch as well. See, e.g., Columbia
Broad. Sys., Inc. v. Democratic Nat’l Comm., 412 U.S. 94, 160 (1973) (Douglas, J., concurring) (describing the First
Amendment as restricting Congress, whether “acting directly or through any of its agencies such as the FCC”); see
generally Daniel J. Hemel, Executive Action and the First Am endm ent’s First Word , 40 PEPP. L. REV. 601 (2013).
2 See Everson, 330 U.S. at 15–16.
3 Comm. for Pub. Educ. & Religious Liberty v. Nyquist, 413 U.S. 756, 771 –72 (1973).
4 Masterpiece Cakeshop, Ltd. v. Colo. Civil Rights Comm’n, 138 S. Ct. 1719, 1731 (2018).
5 Everson, 330 U.S. at 16.
6 Id. at 3.
7 Id. at 16–17.
8 See id. at 16.
9 Id.
10 Id.
11 Id. at 18; see also, e.g., Agostini v. Felton, 521 U.S. 203, 231–32 (1997) (citing Everson and upholding a state
program that allocated services “ on the basis of criteria that neither favor nor disfavor religion”).
12 Walz v. T ax Comm’n, 397 U.S. 664, 669 (1970).
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Evaluating Federal Financial Assistance Under the Constitution’s Religion Clauses

forms of support for religious entities without violating the Establishment Clause,13 the Court has
also held that the government may prohibit religious uses of general y available benefits without
violating the Free Exercise Clause.14 However, the Court has recognized that at times, its opinions
have demonstrated “considerable internal inconsistency,”15 and its interpretations of the First
Amendment have shifted over the past several decades.16
The ambiguity created by the bare nature of the constitutional text and the Supreme Court’s
varying interpretations of the First Amendment can make it difficult for the government to know
how to treat religious entities or activities when creating public benefits programs. The Supreme
Court, however, has announced a number of guiding principles, and Congress has addressed how
religious entities may participate in federal y funded programs in a number of federal statutes and
regulations.
This report explores the Supreme Court’s rulings on the Religion Clauses and public aid, focusing
primarily on the provision of government funds to religious institutions, rather than the provision
of general y available benefits such as goods, services, or facilities. The report begins with
Establishment Clause limitations on the government’s ability to financial y support religious
entities, and then turns to Free Exercise limitations on the government’s ability to exclude
religious entities from general y available programs. The report ends by exploring the
implications of these rulings for Congress, discussing existing federal statutes that govern the
provision of federal funds to religious institutions, as wel as some recent executive branch
interpretations of those laws.
Establishment Clause
General Background
The First Amendment’s Establishment Clause forbids the government from making any law
“respecting an establishment of religion.”17 Perhaps most obviously, this provision prevents the
federal government from establishing an official national religion akin to the Church of
England.18 But relying on the historical background preceding the adoption of this amendment,
and looking particularly to the colonists’ experiences with religious establishments, the Supreme

13 See Everson, 330 U.S. at 17.
14 E.g., Locke v. Davey, 540 U.S. 712, 715 (2004) (upholding state scholarship program that excluded students
pursuing degrees in devotional theology).
15 Walz, 397 U.S. at 668. Cf., e.g., John T . Valauri, The Concept of Neutrality in Establishment Clause Doctrine, 48 U.
PITT. L. REV. 83, 86 (1986) (“ Everson . . . simultaneously adopted two different and incompatible conceptions of
Establishment Clause neutrality—a separationist conception prohibiting aid to religion and an accommodationist
conception allowing religious participation in secular governmental programs of general social benefit.”).
16 See, e.g., Mitchell v. Helms, 530 U.S. 793, 828 (2000) (plurality opinion) (describing a prior inquiry into whether
government aid went to a “pervasively sectarian” activity as “not only unnecessary but also offensive”); Agostini v.
Felton, 521 U.S. 203, 223, 236 (1997) (overruling two prior decisions, describing how more recent cases had
“modified” the Court’s review of whether government aid impermissibly advanced religion).
17 U.S. CONST. amend. I.
18 See, e.g., Everson, 330 U.S. at 15; see also, e.g., History of the Church of England, T HE CHURCH OF ENGLAND,
https://www.churchofengland.org/more/media-centre/church-england-glance/history-church-england (last visited Sept.
9, 2020) (noting that the Church of England is “ the established Church in England”).
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Court has long understood the Establishment Clause to bar other types of government support that
would tend to “establish” religion, as wel :
The “establishment of religion” clause of the First Amendment means at least this: Neither
a state nor the Federal Government can set up a church. Neither can pass laws which aid
one religion, aid all religions, or prefer one religion over another. Neither can force nor
influence a person to go to or to remain away from church against his will or force him to
profess a belief or disbelief in any religion. No person can be punished for entertaining or
professing religious beliefs or disbeliefs, for church attendance or non -attendance. No tax
in any amount, large or small, can be levied to support any religious activities or
institutions, whatever they may be called, or whatever form they may adopt to teach or
practice religion. Neither a state nor the Federal Government can, openly or secretly,
participate in the affairs of any religious organizations or groups and vice versa.19
In particular, the Supreme Court has observed that “a law may be one ‘respecting’” establishment
even if it does not explicitly establish a religion.20 The Court has said that for the Founders, laws
respecting “the ‘establishment’ of a religion connoted sponsorship, financial support, and active
involvement of the sovereign in religious activity.”21 Most relevant to this report, the Court has
recognized that the Establishment Clause imposes limits on when the government can provide
financial assistance to religious entities.22
While the Supreme Court has often referred to government neutrality toward religion as its
guiding principle in applying the Establishment Clause,23 it has adopted a variety of approaches to
determine whether any given action is sufficiently neutral.24 At a theoretical level, the Court has
seemed to vacil ate between a separationist and an accommodationist view of the Establishment
Clause.25 The separationist view is embodied by Thomas Jefferson’s statement that the First
Amendment created “a wal of separation between church and State.”26 Thus, in Everson v. Board
of Education in 1947, the Supreme Court said that this wal “must be kept high and
impregnable.”27 The “separation” of church and state is intended not only to protect the
government from religious influence, but also to protect religious exercise by preventing the
government from intervening in religious affairs.28 In 1971, however, in Lemon v. Kurtzman, the
Supreme Court said that “far from being a ‘wal ,’” the line separating church from state “is a
blurred, indistinct, and variable barrier depending on al the circumstances of a particular

19 Everson, 330 U.S. at 15–16.
20 Lemon v. Kurtzman, 403 U.S. 602, 612 (1971) (emphasis added).
21 Walz v. T ax Comm’n, 397 U.S. 664, 668 (1970).
22 See, e.g., Comm. for Pub. Educ. & Religious Liberty v. Nyquist, 413 U.S. 756, 783 (1973) (ruling that the effect of a
state’s tuition reimbursement program was “unmistakably to provide desired financial support for nonpublic, sectarian
institutions”).
23 See, e.g., McCreary Cty. v. Am. Civil Liberties Union, 545 U.S. 844, 874 (2005); Wallace v. Jaffree, 472 U.S. 38, 60
(1985); Everson, 330 U.S. at 18.
24 See, e.g., Max Guirguis, A Coat of Many Colors: The Religious Neutrality Doctrine from Everson to Hein, 43
STETSON L. REV. 67, 68 (2013); Valauri, supra note 15, at 94.
25 See, e.g., Steven G. Gey, Reconciling the Supreme Court’s Four Establishment Clauses, 8 U. PA. J. CONST. L. 725,
725 (2006); Ira C. Lupu, The Lingering Death of Separationism , 62 GEO. WASH. L. REV. 230, 232 (1994).
26 See Everson, 330 U.S. at 16 (quoting Letter from T homas Jefferson to the Danbury Baptist Ass’n (Jan. 1, 1802),
https://founders.archives.gov/documents/Jefferson/01-36-02-0152-0006 (internal quotation marks omitted)).
27 Id. at 18. But as discussed above, the Court concluded that the state program reimbursing parents for transportation
costs to religious schools had not “breached” that wall. Id.
28 See, e.g., Engel v. Vitale, 370 U.S. 421, 431 (1962).
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relationship.”29 And in a dissenting opinion in 1985, then-Associate Justice Rehnquist argued that
“[t]here is simply no historical foundation for the proposition that the Framers intended to build
the ‘wal of separation’ that was constitutionalized in Everson.”30 Over the years, the Court has
trended toward a more accommodationist approach to the First Amendment, becoming more
accepting of government support for religion.31
The Court’s predominant approach to evaluating Establishment Clause chal enges during much of
the modern era has been an analysis known as the Lemon test,32 although the Court has not
always followed this approach.33 Lemon involved chal enges to two state programs that provided
public funds to church-affiliated schools.34 To determine whether these programs violated the
Establishment Clause, the Court considered three different tests drawn from its prior decisions,
stating that to be considered constitutional: (1) a government action “must have a secular
legislative purpose”; (2) “its principal or primary effect must be one that neither advances nor
inhibits religion”; and (3) it “must not foster ‘an excessive government entanglement with
religion.’”35 This statement has become known as the three-part Lemon test, focusing on purpose,
effect, and entanglement.36 Each prong of Lemon is discussed in more detail below with respect to
programs providing public funds.
While Lemon provides the prevailing analysis for Establishment Clause claims, the Court has also
employed variations on the three-part Lemon test, and has at times refrained entirely from using
this framework. For example, in Lynch v. Donnelly, issued in 1984, the Supreme Court applied
the Lemon test to hold that a city did not violate the Establishment Clause by erecting a Christmas
display that included a nativity scene.37 Writing a separate concurring opinion, Justice O’Connor
suggested a “clarification” of Lemon.38 She argued that the Court should ask whether the city had
“endorsed Christianity” by displaying the crèche, saying that the first and second prongs of the

29 Lemon v. Kurtzman, 403 U.S. 602, 614 (1971).
30 Wallace v. Jaffree, 472 U.S. 38, 92, 106 (1985) (Rehnquist, J., dissenting). In 1986, Justice Rehnquist was elevated
from Associate Justice to Chief Justice. Justices 1789 to Present, SUPREME COURT OF THE UNITED STATES
https://www.supremecourt.gov/about/members_text.aspx (last visited Sept. 9, 2019). See also Lynch v. Donnelly, 465
U.S. 668, 673 (1984) (“ Nor does the Constitution require complete separation of church and state; it affirmatively
mandates accommodation, not merely tolerance, of all religions, and forbids hostility toward any. ”).
31 See, e.g., Guirguis, supra note 24, at 89–90; Lupu, supra note 25, at 237; Martha McCarthy, Preserving the
Establishm ent Clause: One Step Forward and Two Steps Back, 2001 BYU EDUC. & L. J. 271, 283–84 (2001).
32 See Lemon v. Kurtzman, 403 U.S. 602, 612–13 (1971). See also, e.g., Zelman v. Simmons-Harris, 536 U.S. 639, 668
(2002) (O’Connor, J., concurring) (describing Lemon as “[a] central tool” in Establishment Clause analysis); Doe v.
Elmbrook Sch. Dist., 687 F.3d 840, 849 (7th Cir. 2012) (saying that Lem on is the prevailing test for Establishment
Clause claims); Newdow v. Rio Linda Union Sch. Dist., 597 F.3d 1007, 1017 (9th Cir. 2010) (same); Freiler v.
T angipahoa Parish Bd. of Educ., 185 F.3d 337, 344 (5th Cir. 1999) (same).
33 See, e.g., Van Orden v. Perry, 545 U.S. 677, 685–86 (2005) (plurality opinion) (“Over the last 25 years, we have
sometimes pointed to Lem on v. Kurtzm an as providing the governing test in Establishment Clause challenges. Yet, just
two years after Lem on was decided, we noted that the fact ors identified in Lem on serve as ‘no more than helpful
signposts.’” (quoting Hunt v. McNair, 413 U.S. 734, 741 (1973)) (citations omitted)); Lynch v. Donnelly, 465 U.S.
668, 679 (1984) (noting the Court’s “unwillingness to be confined to any single test or criterion in this sensitive area”).
Cf., e.g., Larson v. Valente, 456 U.S. 228, 246 (1982) (“ [W]hen we are presented with a state law granting a
denom inational preference, our precedents demand that we treat the law as suspect and that we apply strict scr utiny in
adjudging its constitutionality.” (emphasis added)).
34 See Lemon, 403 U.S. at 606–07.
35 Id. at 612–13 (quoting Walz v. T ax Comm’n, 397 U.S. 664, 674 (1970)).
36 See, e.g., Agostini v. Felton, 521 U.S. 203, 218 (1997).
37 Lynch v. Donnelly, 465 U.S. 668, 685 (1984).
38 Id. at 687 (O’Connor, J., concurring).
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Lemon test, relating to purpose and effect, focus on endorsement: “The purpose prong of the
Lemon test asks whether government’s actual purpose is to endorse or disapprove of religion. The
effect prong asks whether, irrespective of government’s actual purpose, the practice under review
in fact conveys a message of endorsement or disapproval.”39 In a later concurrence, Justice
O’Connor stated that endorsement should be judged by whether a “reasonable observer” would
think the government is endorsing religion.40 The Supreme Court as a whole has sometimes used
this endorsement test,41 which has been described as a relatively more accommodationist position
compared to the original Lemon test.42
In addition, the test’s three prongs blend together; and specifical y, Supreme Court has not always
treated the entanglement prong of the Lemon test as a distinct inquiry. In Agostini v. Felton, a
1997 decision, the Supreme Court said that the inquiry into entanglement should be treated “as an
aspect of the inquiry into a statute’s effect.”43 Accordingly, in that case, the Court asked whether a
school aid program created “an ‘excessive’ entanglement that advances or inhibits religion.”44
Later in the opinion, the Court ruled that the chal enged program did not “run afoul of any of
three primary criteria we currently use to evaluate whether government aid has the effect of
advancing religion: it does not result in governmental indoctrination; define its recipients by
reference to religion; or create an excessive entanglement.”45 In 2000’s Mitchell v. Helms, a
plurality of the Court considered a chal enged aid program’s purpose and effect, using the three
criteria identified in Agostini to judge its effect.46
In addition to the Court’s various attempts to clarify or reframe Lemon, a number of Justices have
criticized Lemon’s attempt to articulate “a grand unified theory of the Establishment Clause.”47
Many have argued that the test is difficult to apply in a consistent way, a problem compounded by
the fact that the Court has not always employed the same test.48 Justice Scalia once described the
Court’s “intermittent use” of Lemon as creating a “strange Establishment Clause geometry of
crooked lines and wavering shapes.”49 In particular, some Justices have argued that the Court
should, in lieu of Lemon, look to “historical practices and understandings” in interpreting the

39 Id. at 690.
40 Allegheny Cty. v. ACLU, 492 U.S. 573, 630 (1989) (O’Connor, J., concurring).
41 See, e.g., Zelman v. Simmons-Harris, 536 U.S. 639, 655 (2002); Allegheny Cty., 492 U.S. at 592 (majority opinion).
42 See, e.g., Steven G. Gey, Religious Coercion and the Establishment Clause, 1994 U. ILL. L. REV. 463, 476 (1994);
Lupu, supra note 25, at 240.
43 Agostini v. Felton, 521 U.S. 203, 233 (1997).
44 Id.
45 Id. at 234 (emphasis added); see also id. at 234–35 (“ We therefore hold that a federally funded program providing
supplemental, remedial instruction to disadvantaged children on a neutral basis is not invalid under the Establishmen t
Clause when such instruction is given on the premises of sectarian schools by government employees pursuant to a
program containing safeguards such as those present here.”).
46 Mitchell v. Helms, 530 U.S. 793, 808 (2000) (plurality opinion). See also Zelman, 536 U.S. at 648–49 (“The
Establishment Clause of the First Amendment . . . prevents a State from enacting laws that have the ‘purpose’ or
‘effect’ of advancing or inhibiting religion.” (quoting Agostini, 521 U.S. at 222–23)).
47 Am. Legion v. Am. Humanist Ass’n, 139 S. Ct. 2067, 20 87 (2019) (plurality opinion). See also id. at 2081 (noting
criticism of Lem on by Justices, lower court judges, and “ a diverse roster of scholars”).
48 See, e.g., Utah Highway Patrol Ass’n v. Am. Atheists, Inc., 565 U.S. 994, 997–1001 (2011) (T homas, J., dissenting
from denial of certiorari); Cooper v. U.S. Postal Serv., 577 F.3d 479, 494 (2d Cir. 2009); Michael W. McConnell,
Religious Freedom at a Crossroads, 59 U. CHI. L. REV. 115, 118–20 (1992).
49 Lamb’s Chapel v. Ctr. Moriches Union Free Sch. Dist., 508 U.S. 384, 399 (1993) (Scalia, J., concurring in the
judgment).
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Establishment Clause, and that any constitutional test must, at minimum, al ow governments to
continue to engage in practices with a long history.50
A focus on historical traditions has displaced Lemon in several discrete Establishment Clause
chal enges. In cases involving government-sponsored prayer before legislative sessions, the Court
has upheld prayer practices so long as they fit “within the tradition long followed in Congress and
the state legislatures.”51 In the 2019 case American Legion v. American Humanist Association, the
Supreme Court considered whether to more broadly abandon Lemon and instead adopt a test
focused on historical practice.52 The Court was evaluating the constitutionality of a state war
memorial that consisted primarily of a large Latin cross.53 The majority opinion, authored by
Justice Alito, suggested that the Lemon test is not wel -suited to evaluating religious “monuments,
symbols, or practices that were first established long ago,” but stopped short of expressly holding
that Lemon is inapplicable in such cases.54 The majority appeared to rely heavily on history and
tradition in upholding the constitutionality of the memorial, stating that in most cases, “[t]he
passage of time gives rise to a strong presumption of constitutionality.”55
However, a different majority of Justices, in various opinions, expressed a belief that the Court
should more broadly abandon the Lemon test.56 Justice Alito, in a portion of his American Legion
opinion that was only joined by three other Justices, suggested that “longstanding monuments,
symbols, and practices” should not be evaluated under Lemon,57 but should instead be considered
constitutional so long as they “follow in” a historical “tradition” of religious accommodation.58

50 Allegheny Cty. v. ACLU, 492 U.S. 573, 655, 670 (1989) (Kennedy, J., concurring in the judgment an d dissenting in
part). Justice Kennedy also argued that the government must be able to engage in “any other practices” that present “no
greater potential for an establishment of religion” than those historical practices. Id. See also, e.g., Am. Legion v. Am.
Humanist Ass’n, 139 S. Ct. 2067, 2087 (2019) (plurality opinion) (“While the Lemon Court ambitiously attempted to
find a grand unified theory of the Establishment Clause, in later cases, we have taken a more modest approach that
focuses on the particular issue at hand and looks to history for guidance.”). By contrast, Justice T homas has argued that
governmental action violates the Establishment Clause if it “shares any of the historical characteristics of an
establishment of religion,” which in his view would occur only if the government “attempted to control religious
doctrine or personnel, compel religious observance, single out a particular religious denomination for exclusive state
subsidization, or punish dissenting worship.” Am. Legion, 139 S. Ct. at 2096–98 (Thomas, J., concurring in the
judgment). Justice T homas has also questioned the Court’s conclusion that the Establishment Clause applies to the
states, saying that instead, the Clause “resists incorporation.” Id. at 2095. Justice T homas reiterated this view in 2020,
in a concurring opinion that was joined by Justice Gorsuch. Espinoza v. Mont. Dep’t of Revenue, 140 S. Ct. 2246, 2263
(2020) (T homas, J., concurring).
51 T own of Greece v. Galloway, 572 U.S. 565, 577 (2014). See also, e.g., Marsh v. Chambers, 463 U.S. 783, 792
(1983) (“ In light of the unambiguous and unbroken history of more than 200 years, there can be no doubt that the
practice of opening legislative sessions with prayer has become part of the fabric of our society. ”).
52 Am. Legion, 139 S. Ct. at 2087 (plurality opinion). See also CRS Legal Sidebar LSB10315, No More Lemon Law?
Suprem e Court Rethinks Religious Establishm ent Analysis, by Valerie C. Brannon.
53 Am. Legion, 139 S. Ct. at 2077 (majority opinion).
54 Id. at 2082.
55 Id. at 2085.
56 Id. at 2081–82 (plurality opinion); id. at 2097 (T homas, J., concurring in the judgment); id. at 2101–02 (Gorsuch, J.,
concurring in the judgment).
57 Id. at 2081–82 (plurality opinion); see also id. at 2081 (“[T]he Lemon test presents particularly daunting problems in
cases, including the one now before us, that involve the use, for ceremonial, celebratory, or commemorative purposes,
of words or symbols with religious associations.”).
58 Id. at 2089 (plurality opinion). While Justice Breyer joined this portion of the plurality opinion and agreed that “the
Court appropriately ‘looks to history for guidance,’” he emphasized in a separate opinion that he did not understand the
majority “to adopt a ‘history and tradition test’ that would permit any newly constructed religious memorial on public
land” to stand regardless of the monument’s “particular historical context.” Id. at 2091 (Breyer, J., concurring)
(citations omitted). Further, both Justice Breyer and Justice Kagan expressed a belief that even if the Court does not
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Justices Thomas, Gorsuch, and Kavanaugh wrote separate concurrences in American Legion
disapproving of Lemon more general y, appearing to reject Lemon’s three-pronged test even in
cases concerning public funding.59 Justice Alito’s four-Justice plurality opinion appears to be the
controlling opinion for future cases because it is narrower than the concurrences.60 Consequently,
in the future, when courts evaluate longstanding, government-sponsored religious “monuments,
symbols, and practices,” rather than applying Lemon, they may instead ask whether the display or
practice is consistent with historical traditions.61 But as noted, the Court did not overrule the
Lemon test, and lower courts wil likely continue to use this test in future cases until the Supreme
Court says otherwise, particularly in cases involving funding, rather than legislative prayer or
longstanding monuments.62
Assessing Public Funding of Religious Entities
Various types of public support for religious entities have been chal enged as violating the
Establishment Clause, including programs to lend textbooks or other educational materials to
religious schools63 as wel as programs al owing religious teachers to teach religion in public
schools during normal school hours.64 The Court has said that barring religious entities from
participating on an equal basis in generally available benefits programs could sometimes “lead to
. . . absurd results,” creating a risk that churches could not be protected by the fire department or
benefit from publicly maintained sidewalks.65 But the Supreme Court has repeatedly suggested
that when the government provides financial aid to religious entities, as opposed to providing
other types of aid, such support presents heightened Establishment Clause concerns.66 The Court

apply Lem on as such, it should continue to focus on the purpose and effect of government action. Id. at 2091 (noting
that the particular monument before the Court was erected wit h a “ secular motive” and conveyed a secular “ message of
patriotism and commemoration”); id. at 2094 (Kagan, J., concurring) (“ Although I agree that rigid application of the
Lem on test does not solve every Establishment Clause problem, I think that test’s f ocus on purposes and effects is
crucial in evaluating government action in this sphere—as this very suit shows.”).
59 Id. at 2097 (T homas, J., concurring in the judgment); id. at 2101–02 (Gorsuch, J., concurring in the judgment); id. at
2093 (Kavanaugh, J., concurring). However, Justice T homas recognized that government coercion of financial support
for religion might violate the Establishment Clause. Id. at 2096 (T homas, J., concurring in the judgment).
60 See Marks v. United States, 430 U.S. 188, 193 (1977) (explaining that when “no single rationale explaining the result
[of a case] enjoys the assent of five Justices,” the position representing the narrowest grounds is the Court’s holding).
61 Am. Legion, 139 S. Ct. at 2089 (plurality opinion). See also, e.g., Freedom From Religion Found., Inc. v. City of
Lehigh, 933 F.3d 275, 279 (3d Cir. 2019) (holding that in light of Am erican Legion, the Lem on test did not guide the
court’s review of a county seal that contained a Latin cross, and ruling that the seal was constitutional because the
record did not displace the “strong presumption” that “longstanding symbols” are constitutional).
62 See, e.g., Freedom From Religion Found., Inc., 933 F.3d at 281 (noting that the Court did not overrule Lemon in
Am erican Legion); Woodring v. Jackson Cty., No. 4:18-cv-00243-TWP-DML, 2019 U.S. Dist. LEXIS 167728, at *6 –7
(S.D. Ind. Sept. 30, 2019) (noting that although Am erican Legion “ frowns upon the Lem on test,” it does not offer an
alternative test, and using “the endorsement, coercion, and purpose tests” to evaluate the constitutionality of a nativity
scene on public property); Ctr. for Inquiry, Inc. v. Warren, No. 3:18 -CV-2943-B, 2019 U.S. Dist. LEXIS 138839, at
*19–21 (N.D. T ex. 2019) (noting that the Court’s recent Establishment Clause cases, including Am erican Legion, have
looked to history, but concluding that the historical approach was not dispositive in the case before the court and
instead upholding under Lem on a state law providing that only religious officers may solemn ize marriage ceremonies).
63 See, e.g., Bd. of Educ. v. Allen, 392 U.S. 236, 243 (1968) (upholding program as constitutional).
64 See, e.g., Illinois ex rel. McCollum v. Bd of Educ., 333 U.S. 203, 212 (1948) (ruling that such a program violates the
Establishment Clause).
65 Zobrest v. Catalina Foothills Sch. Dist., 509 U.S. 1, 8 (1993).
66 See, e.g., Mitchell v. Helms, 530 U.S. 793, 818–19 (2000) (plurality opinion); Rosenberger v. Rector & Visitors of
the Univ. of Va., 515 U.S. 819, 842, 844 (1995); Everson v. Bd. of Educ., 330 U.S. 1, 18 (1947).
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has recognized that “financial support” of religion was squarely in the minds of those who
adopted the Establishment Clause.67
The Supreme Court has general y evaluated such aid under the Lemon framework discussed
above—although its financial aid cases have also reflected the varying approaches to Lemon. As
addressed in more detail below, under Lemon, the Supreme Court has said that financial aid
programs wil be unconstitutional if they have an impermissible purpose or effect,68 sometimes
evaluating Lemon’s first two prongs under the endorsement framework.69 The Supreme Court has
struck down programs that violate Lemon’s final prong by creating an excessive entanglement, if
the program requires excessive government monitoring of religious organizations.70 However, the
Court has held that Lemon does al ow the government to provide financial aid to religious entities
under certain circumstances.71
One central issue in modern Establishment Clause jurisprudence concerns who decides that aid
wil be provided to a religious entity. The Supreme Court has said financial aid wil be especial y
problematic if the government is giving funds directly to religious entities, as opposed to giving
the funds to third parties who then choose to use federal funds to support religious entities.72
Thus, the Court has distinguished between programs “that provide aid directly to religious”
entities, which are more constitutional y suspect, and so-cal ed “programs of true private choice”
that provide indirect aid.73 The Court has said that indirect aid wil general y be deemed
permissible under Lemon if the “government aid program is neutral with respect to religion, and
provides assistance directly to a broad class of citizens who, in turn, direct government aid to
religious schools wholly as a result of their own genuine and independent private choice.”74
Purpose
The first prong of the Lemon test asks whether the public aid has “a secular legislative
purpose”75—or under the endorsement test, whether the “government’s actual purpose is to
endorse or disapprove of religion.”76 The government acts with an impermissible purpose if it
seeks to “establish[], sponsor[], or support[] religion.”77 In a number of public aid cases, the

67 Walz v. T ax Comm’n, 397 U.S. 664, 668 (1970). Cf., e.g., Lee v. Weisman, 505 U.S. 577, 641 (1992) (Scalia, J.,
dissenting) (“I will further acknowledge for the sake of argument that, as some scholars have argued, by 1790 the term
‘establishment’ had acquired an additional meaning—‘financial support of religion generally, by public taxation[.]’”
(quoting LEONARD LEVY, THE ESTABLISHMENT CLAUSE: RELIGION AND THE FIRST AMENDMENT 8–9 (1986))).
68 Lemon v. Kurtzman, 403 U.S. 602, 612–13 (1971); see also, e.g., T ex. Monthly, Inc. v. Bullock, 489 U.S. 1, 17
(1989) (plurality opinion) (ruling unconstitutional a tax exemption giving preferential support only to religious
publications); id. at 28 (Blackmun, J., concurring) (same).
69 See, e.g., Zelman v. Simmons-Harris, 536 U.S. 639, 655 (2002).
70 E.g., Lemon, 403 U.S. at 615.
71 E.g., Bowen v. Kendrick, 487 U.S. 589, 602 (1988). Cf. Roemer v. Bd. of Pub. Works, 426 U.S. 736, 747 (1976)
(plurality opinion) (“The Court has taken the view that a secular purpose and a facial neutrality may not be enough, if
in fact the State is lending direct support to a religious activity.”).
72 See, e.g., Locke v. Davey, 540 U.S. 712, 719 (2004).
73 See, e.g., Zelman v. Simmons-Harris, 536 U.S. 639, 649 (2002); Lemon v. Kurtzman, 403 U.S. 602, 621 (1971). Cf.
Mitchell v. Helms, 530 U.S. 793, 818 (2000) (plurality opinion) (“ Whether one chooses to label this program ‘direct’ or
‘indirect’ is a rather arbitrary choice, one that does not further the constitutional analysis.”).
74 Zelman, 536 U.S. at 652.
75 Lemon, 403 U.S. at 612.
76 Lynch v. Donnelly, 465 U.S. 668, 690 (1984) (O’Connor, J., concurring).
77 Walz v. T ax Comm’n, 397 U.S. 664, 674 (1970). Walz was decided prior to Lemon, but the Court’s inquiry
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Supreme Court has suggested that if a program broadly provides benefits to a large group of
recipients rather than singling out religious recipients, this may show that the government is not
acting with an impermissible purpose of supporting religion.78
Thus, for example, the Supreme Court has upheld programs where state governments were
motivated by “secular” purposes such as “providing educational assistance to poor children,”79
defraying parents’ educational costs,80 or “assuring the continued financial health of private
schools, both sectarian and nonsectarian.”81 To take another example, in Bowen v. Kendrick, the
Supreme Court held that the federal government could give funds to religious organizations as
part of a broader program.82 The program offered grants to nonprofit organizations to provide
services “for the provision of care to pregnant adolescents and adolescent parents, . . . [and] for
the prevention of adolescent sexual relations.”83 The Court concluded that reducing “social and
economic problems caused by teenage sexuality, pregnancy, and parenthood” was “a legitimate
secular purpose.”84
There are not many cases in which the Supreme Court has concluded that a program failed the
purpose prong of the Lemon test, particularly in the specific context of financial aid programs.85
The Court has occasional y found an impermissible purpose in the context of programs involving
other types of public aid.86 For example, the Supreme Court ruled in two different cases that state
laws restricting the teaching of evolutionary biology had the impermissible purpose of advancing
certain religious views regarding the creation of humans.87 In one of these cases, the Court
rejected the state’s asserted secular purpose of ensuring “academic freedom,” noting that public
schools were already free to teach any scientific theory, so that the law provided them “with no
new authority,” and emphasizing that the law offered special resources and protection to “creation
scientists” and “creationism.”88 Thus, this case shows that the Court may, in special

nonetheless focused on purpose, effect, and excessive government entanglement with religion. See id.
78 See, e.g., id. at 672–74; Zelman, 536 U.S. at 652.
79 Zelman, 536 U.S. at 649.
80 Mueller v. Allen, 463 U.S. 388, 395 (1983).
81 Id. See also, e.g., Rosenberger v. Rector & Visitors of the Univ. of Va., 515 U.S. 819, 84 0 (1995) (“The
governmental program here is neutral toward religion. T here is no suggestion that the University created it to advance
religion or adopted some ingenious device with the purpose of aiding a religious cause. T he object of the [program] is
to open a forum for speech and to support various student enterprises, including the publication of newspapers, in
recognition of the diversity and creativity of student life.”).
82 Bowen v. Kendrick, 487 U.S. 589, 602 (1988).
83 Id. at 594.
84 Id. at 602. T he Court said that this secular motive was not undermined by the fact that Congress had specifically
amended the statute to make clear that religious organizations were eligible to receive funds, concluding that this
language was not sufficient to demonstrate an impermissible purpose of endorsing religion. Id. at 604–05.
85 See T ex. Monthly, Inc. v. Bullock, 489 U.S. 1, 17 (1989) (plurality opinion) (concluding that a state tax exemption
for religious periodicals lacked “a secular objective that would justify this preference”).
86 See, e.g., Illinois ex rel. McCollum v. Bd. of Educ., 333 U.S. 203, 226 (1948) (concluding that the “ candid purpose”
of a program allowing religious teachers paid by churches to teach religion classes in public schools during normal
class hours “is sectarian teaching”).
87 Edwards v. Aguillard, 482 U.S. 578, 591 (1987) (holding that “[t]he preeminent purpose of the Louisiana Legislature
was clearly to advance the religious viewpoint that a supernatural being created humankind”); Epperson v. Arkansas,
393 U.S. 97, 107–08 (1968) (noting that prior version of the challenged law expressly stated its purpose as making it
unlawful to teach any theory that contradicts biblical teachings and ruling that under the circumstances, “ t here can be
no doubt that Arkansas has sought to prevent its teachers from discussing the theory of evolution because it is contrary
to the belief of some that the Book of Genesis must be the exclusive source of doctrine as to the origin of man ”).
88 Aguillard, 482 U.S. at 587–88.
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circumstances, look beyond a law’s stated secular purpose to determine that in fact, it
impermissibly seeks to advance religion.
Effect
The second prong of the Lemon inquiry asks whether, even if the government did not act with the
purpose of aiding religion, the aid nonetheless has the “principal or primary effect” of
“advanc[ing]” or “inhibit[ing] religion.”89 Viewed through the lens of endorsement, the effects
prong asks whether “the practice under review in fact conveys a message of endorsement or
disapproval” of religion.90
Similar to the inquiry under the purpose prong, the Supreme Court has suggested that one
relevant factor in evaluating a program’s effect is whether the aid is provided to a “broad class” of
recipients or whether it instead appears to be more targeted toward religious beneficiaries.91 In the
context of cases involving indirect aid or nonfinancial aid, the Court has sometimes used
language suggesting that “neutrality,” in the sense of making public aid available to both religious
and nonreligious recipients, may be sufficient to ensure that a program does not violate Lemon’s
effects prong.92 By contrast, in Texas Monthly, Inc. v. Bullock, the Supreme Court struck down a
state tax exemption for periodicals distributed “by a religious faith” that consisted “wholly” of
religious “writings.”93 Justice Brennan, writing for a plurality of the Court, concluded that this
exemption failed the endorsement test.94 He said that “when government directs a subsidy
exclusively to religious organizations that is not required by the Free Exercise Clause,” that
conveys an impermissible message of “state sponsorship of religious belief.”95 Justice Blackmun,
joined by Justice O’Connor, agreed that the tax exemption violated the Establishment Clause
because the state had “engaged in preferential support for the communication of religious
messages.”96
In direct aid programs, the Court has said that aid wil have an impermissible effect if there is no
“effective means of guaranteeing that the state aid derived from public funds wil be used
exclusively for secular, neutral, and nonideological purposes.”97 In Committee for Public
Education and Religious Liberty v. Nyquist and Levitt v. Committee for Public Education, the
Supreme Court held that two state programs funding private schools violated the Establishment
Clause because the program lacked any measures to ensure that the funds would not be used for

89 Lemon v. Kurtzman, 403 U.S. 602, 612 (1971).
90 Lynch v. Donnelly, 465 U.S. 668, 690 (1984) (O’Connor, J., concurring).
91 Zelman v. Simmons-Harris, 536 U.S. 639, 652, 661 (2002).
92 See, e.g., Mitchell v. Helms, 530 U.S. 793, 810 (2000) (plurality opinion) (“[I] f the government, seeking to further
some legitimate secular purpose, offers aid on the same terms, without regard t o religion, to all who adequately further
that purpose, then it is fair to say that any aid going to a religious recipient only has the effect of furthering that secul ar
purpose.” (citation omitted)); id. at 837 (O’Connor, J., concurring) (disagreeing with “ the plurality’s treatment of
neutrality,” which “ comes close to assigning that factor singular importance in the future adjudication of Establishment
Clause challenges to government school-aid programs”). See generally, e.g., Espinoza v. Mont. Dep’t of Revenue, 140
S. Ct. 2246, 2254 (2020) (“We have repeatedly held that the Establishment Clause is not offended when religious
observers and organizations benefit from neutral government programs. ”).
93 T ex. Monthly, Inc. v. Bullock, 489 U.S. 1, 5 (1989) (plurality opinion).
94 Id. at 17.
95 Id. at 15 (emphasis added).
96 Id. at 28 (Blackmun, J., concurring). Justice Blackmun believed that this “statutory preference for the dissemination
of religious ideas” could not be considered a “constitutionally permissible” accommodation of religion. Id.
97 Comm. for Pub. Educ. & Religious Liberty v. Nyquist, 413 U.S. 756, 780 (1973).
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religious purposes.98 In Nyquist, the Court was considering a state law that, among other things,
offered grants to private schools for facilities maintenance and repair.99 The law did not “restrict
payments . . . to the upkeep of facilities used exclusively for secular purposes,” and would have,
for example, al owed schools to use the funds for “the salaries of employees who maintain the
school chapel, or the cost of renovating classrooms in which religion is taught.”100 Accordingly,
the Court concluded that the program failed the effect prong of Lemon because it would
“inevitably . . . subsidize and advance the religious mission of sectarian schools.”101 Similarly, in
Levitt, the Supreme Court held that a state program reimbursing religious schools for performing
certain testing and recordkeeping services violated the Establishment Clause because “the aid that
[would] be devoted to secular functions [was] not identifiable and separable from aid to sectarian
activities.”102 The Court noted that the tests were prepared by “teachers under the authority of
religious institutions” and ruled that there was an inherent risk of the test being used for “religious
indoctrination.”103
Concurrently, the Supreme Court has upheld some programs that provide funds directly to
religious entities when the programs restrict the religious use of those funds. Seven years after its
decision in Levitt, the Court upheld a revised version of the testing-reimbursement law that it had
struck down in that decision.104 The new law did not al ow reimbursement for teacher-prepared
tests and al owed states to audit payments.105 The Court ruled that these new safeguards were
sufficient to ensure “that the cash reimbursements would cover only secular services.”106 In Hunt
v. McNair, a decision issued the same day as Nyquist and Levitt, the Court rejected an
Establishment Clause chal enge to a state revenue bond issued to a religious college as part of a
program that offered financial assistance to colleges for facilities construction and
maintenance.107 The state program specified that funds could not be used for “any facility used
. . . for sectarian instruction or as a place of religious worship nor any facility which is used . . .
primarily in connection with any part of the program of a school or department of divinity for any
religious denomination”108—in short, excluding any “facilities used for religious purposes.”109
The Court concluded that absent any evidence that public funds were actual y going to religious
uses, this provision was sufficient to ensure that the program did “not have the primary effect of
advancing or inhibiting religion.”110

98 Id. at 779–80; Levitt v. Comm. for Pub. Educ. & Religious Liberty, 413 U.S. 472, 480 (1973).
99 Nyquist, 413 U.S. at 774.
100 Id.
101 Id. at 779–80. Cf., e.g., Am. Atheists, Inc. v. City of Detroit Downtown Dev. Auth., 567 F.3d 278, 298 (6th Cir.
2009) (“‘[A]ll or practically all’ of the schools eligible for the grants [in Nyquist] were not merely religious; they also
were from the same denomination, which itself suggested a forbidden purpose.” (quoting Nyquist, 413 U.S. at 768)).
102 Levitt, 413 U.S. at 480.
103 Id.
104 Comm. for Pub. Educ. & Religious Liberty v. Regan, 444 U.S. 646, 657, 659 (1980).
105 Id. at 652.
106 Id. at 659.
107 Hunt v. McNair, 413 U.S. 734, 736 (1973).
108 Id. at 736–37 (quoting S.C. Code Ann. § 22-41.2(b) (Supp. 1971)) (internal quotation marks omitted).
109 Id. at 744.
110 Id. at 744–45. See also Roemer v. Bd. of Pub. Works, 426 U.S. 736, 740–41 (1976) (plurality opinion) (upholding
state program that gave unrestricted grants to private colleges but stated that the funds could not be used for “sectarian
purposes”); T ilton v. Richardson, 403 U.S. 672, 675 (1971) (plurality opinion) (upholding federal grant program for the
construction of academic facilities that excluded “any facility used or to be used for sectarian instruction or as a place
for religious worship, or . . . any facility which . . . is used or to be used primarily in connection with any part of the
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But while restrictions on the religious use of funds might sometimes be sufficient to ensure a
program does not have an impermissible effect under Lemon, subsequent Supreme Court
precedent may suggest that contrary to some of the language in Nyquist and Levitt, such an
express prohibition might not always be necessary for a program to be ruled constitutional.111 The
Supreme Court has since said that courts should not always assume that religiously affiliated
organizations would use public funds for religious purposes.112 For instance, in Bowen v.
Kendrick, the Court upheld a federal grant program that did not contain any provision expressly
prohibiting the use of federal funds for religious purposes.113 The Court noted that the statute
made funds available to a wide variety of organizations and stated that there was no evidence that
a “significant proportion of the federal funds” would be given to religious institutions.114 Further,
the Court said that it would assume that even absent an express restriction on the religious use of
funds, religious grantees could carry out the funded programs “in a lawful, secular manner.”115
Somewhat similarly, in Agostini v. Felton, the Supreme Court said that in assessing the effect of
other types of public aid, courts should not assume that public school teachers providing
ostensibly secular services at religious schools wil inevitably “inculcate religion in the students”
or otherwise engage in “state-sponsored indoctrination.”116
In indirect aid programs, the Supreme Court has not required the government to include religious
use restrictions.117 Instead, where financial aid is provided to religious entities indirectly, the
Court has general y held that such programs satisfy Lemon’s effects prong even if the funds do
ultimately support religious activities—so long as the program is “neutral in al respects toward
religion,”118 particularly in the sense of using religiously neutral criteria to distribute aid.119 In
Zelman v. Simmons-Harris, for example, the Supreme Court rejected an Establishment Clause
chal enge to a municipal program that offered “tuition aid” to parents with financial needs who
sought to enroll their children in private schools.120 The parents could choose to use those tuition-
aid checks at religious or nonreligious schools.121 The Court said that where the government

program of a school or department of divinity” (omissions in original)).
111 See Mitchell v. Helms, 530 U.S. 793, 856 (2000) (O’Connor, J., concurring) (“ Wolman and Levitt were both based
on the same presumption that government aid will be used in the inculcatio n of religion that we have chosen not to
apply to textbook lending programs and that we have more generally rejected in recent decisions.”); see also Bowen v.
Kendrick, 487 U.S. 589, 634–35 (1988) (Blackmun, J., dissenting) (arguing that the majority opinion “ marks a sharp
departure from” the Court’s precedents, including Levitt).
112 Bowen v. Kendrick, 487 U.S. 589, 612 (1988).
113 Id. at 614.
114 Id. at 608, 610.
115 Id. at 612, 614.
116 Agostini v. Felton, 521 U.S. 203, 223–24 (1997).
117 See, e.g., Zelman v. Simmons-Harris, 536 U.S. 639, 649 (2002). In fact, the Court has sometimes suggested that if
the government prohibits private entities from “us[ing] their own money” to support religion, this would raise concerns
under the Constitution’s Free Exercise Clause. Quick Bear v. Leupp, 210 U.S. 50, 81–82 (1908) (rejecting
constitutional challenge to government contract providing money from the “Sioux T reaty Fund” to a religious school
on the Rosebud Indian Reservation).
118 See Zelman, 536 U.S at 653.
119 See, e.g., Mitchell v. Helms, 530 U.S. 793, 838–39 (2000) (O’Connor, J., concurring in the judgment).
120 Zelman, 536 U.S. at 646.
121 Id. at 653. In its analysis, the Court noted that there was “no evidence” that parents did not have “genuine
opportunities . . . to select secular educational options for their school-age children.” Id. at 655. Although “ 46 of the 56
private schools” participating in the program were religious, secular options were available and there was no evidence
that the city was “coercing parents into sending their children to private schools.” Id. at 655–56. Cf., e.g., Ams. United
for Separation of Church & State v. Prison Fellowship Ministries, Inc., 509 F.3d 406, 425 (8th Cir. 2007) (“In this case,
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program aided “a broad class of citizens” who then chose to “direct government aid to religious
schools wholly as a result of their own genuine and independent private choice,” any support for
religion was “reasonably attributable to the individual recipient, not to the government, whose
role ends with the disbursement of benefits.”122 Consequently, under the endorsement test, “no
reasonable observer would think” that such a program “carries with it the imprimatur of
government endorsement” of religion.123
The Court’s indirect aid cases have frequently involved educational programs. In addition to
programs that provide tuition assistance to parents or students at religious schools,124 the Supreme
Court has also approved of programs that offer financial assistance to parents for other costs
related to attending private schools. For example, in Everson v. Board of Education, the Court
ruled that a state did not violate the Establishment Clause when it reimbursed parents for the cost
of bus fares to send their children to private schools.125 In Mueller v. Allen, the Supreme Court
concluded that a state could al ow taxpayers to claim a tax deduction for tuition, textbooks, and
transportation costs incurred in sending their students to a religious school.126 Among other
factors, the court stressed that the tax deduction was “available for educational expenses incurred
by all parents, including those whose children attend public schools and those whose children
attend non-sectarian private schools or sectarian private schools.”127 Because the benefit was
broadly available and neutral on its face with respect to religion, the Court believed that the
program had a primarily secular effect and did not imply state endorsement of religion.128
To take one last example, the Supreme Court ruled that it did not violate the Establishment Clause
for a public university to pay for the printing of a religious student publication in Rosenberger v.
Rector and Visitors of the University of Virginia.129 The funds came from a Student Activities
Fund, which was general y available to support the extracurricular activities of approved student
groups.130 The student groups chose how to use the funds, and in the case before the court, the
funds were given to the printer, rather than being paid directly to the religious student group.131
Under the circumstances, the Court said it was not “plausible” that any religious speech supported
with these funds would be attributed to the university, rather than the student group that chose
how to use the funds.132 Because the funds were available on a “religion-neutral basis” as part of

there was no genuine and independent private choice. T he inmate could direct the aid only to InnerChange [a religious
program offering services to prison inmates]. T he legislative appropriation could not be directed to a secular program,
or to general prison programs.”); T een Ranch v. Udow, 389 F. Supp. 2d 827, 836 (W.D. Mich. 2005) (ruling that an
“opt-out” provision was not enough to create true private choice where the state selected who would provide services) .
122 Zelman, 536 U.S. at 653.
123 Id. at 655. T he majority opinion relied on the endorsement test. In a concurring opinion, Justice O’Connor explained
that the majority opinion “focuse[d] on a narrow question related to the Lemon test: how to apply the primary effects
prong in indirect aid cases?” Zelman, 536 U.S. at 669 (O’Connor, J., concurring).
124 Locke v. Davey, 540 U.S. 712, 719 (2004) (stating that a state could provide scholarships to students pursuing
degrees “in devotional theology” without violating the Establishment Clause); Zelman, 536 U.S. at 662; Witters v.
Wash. Dep’t of Servs. for the Blind, 474 U.S. 481, 489 (1986) (ruling that a state could provide tuition aid to a visually
impaired student studying religious subjects at a religious college without violating the Establishment Clause).
125 Everson v. Bd. of Educ., 330 U.S. 1, 17 (1947).
126 Mueller v. Allen, 463 U.S. 388, 402–03 (1983).
127 Id. at 397.
128 Id.
129 Rosenberger v. Rector & Visitors of the Univ. of Va., 515 U.S. 819, 84 2 (1995).
130 Id. at 823–24.
131 Id. at 842.
132 Id. at 841.
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a program that funded “secular services” such as printing, the Court held that the school was not
barred from providing these funds to the religious publication.133
At least one case suggests that there may be a limiting principle on the government’s ability to
provide financial assistance in indirect aid programs. In Committee for Public Education and
Religious Liberty v. Nyquist, decided in 1973, the Supreme Court struck down a program that
assisted only private schools.134 In that case, a state offered direct grants to private schools for
maintenance and repair costs—discussed above135—and also provided indirect aid in the form of
tuition reimbursements and tax benefits to parents whose children attended private schools.136
Unlike aid programs that the Court has upheld, the funds in Nyquist could be used only at private
schools, rather than benefitting both public and private schools.137 With respect to the tuition
reimbursements, the Court concluded that regardless of the fact that the funds were given to
parents and not directly to schools, the program was stil unconstitutional because “the effect of
the aid is unmistakably to provide desired financial support for nonpublic, sectarian
institutions.”138 The Court ruled that the tax benefits were similarly unconstitutional, saying that
“in practical terms,” there was little difference between the tuition grant and the tax benefits.139
In Zelman, the Supreme Court clarified that “Nyquist does not govern neutral educational
assistance programs that, like the program here, offer aid directly to a broad class of individual
recipients defined without regard to religion.”140 Accordingly, the Supreme Court has not
expressly overruled Nyquist, but its ruling striking down the tuition reimbursement grants and tax
credits may apply only in limited circumstances.141 In particular, it may be open to debate whether
an indirect aid program that was neutral toward religion on its face and supported both religious
and secular private entities, but did not also aid public entities would raise Establishment Clause
concerns.142 A few judges after Zelman have concluded that indirect assistance programs are

133 Id. at 843–44. T he Court cautioned, however, that “if the State pays a church’s bills it is subsidizing it, and we must
guard against this abuse.” Id. at 844. But the Court said the case before it did not present this circumstance, in part
because “the student publication is not a religious institution . . . and it is not a religious organization.” Id.
134 Comm. for Pub. Educ. & Religious Liberty v. Nyquist, 413 U.S. 756, 798 (1973). T he Court held that a similar
tuition reimbursement program violated the Establishment Clause in Sloan v. Lem on, concluding that Nyquist mandated
this outcome. 413 U.S. 825, 830 (1973).
135 See supra notes 99 to 101 and accompanying text.
136 Nyquist, 413 U.S. at 762–67. T he Court noted that “all or practically all” of the schools eligible for the direct grants
were Catholic, but that religious schools from other denominations and secular private schools were eligible for aid
under the other provisions. Id. at 768 & n.23.
137 See Zelman v. Simmons-Harris, 536 U.S. 639, 661 (2002); Mueller v. Allen, 463 U.S. 388, 398–99 (1983).
138 Nyquist, 413 U.S. at 783. T he Court’s Zelman opinion could be read to suggest that the program in Nyquist was also
motivated by an impermissible purpose: “ Although the program was enacted for ostensibly secular purposes, we found
that its ‘function’ was ‘unm istakably to provide desired financial support for nonpublic, sectarian institutions.’”
Zelm an, 536 U.S. at 661 (quoting Nyquist, 413 U.S. at 783) (internal citations omitted). See also, e.g., Mitchell v.
Helms, 530 U.S. 793, 819 n.8 (2000) (plurality opinion) (stating that Nyquist “ involved serious concerns about whether
the payments were truly neutral”).
139 Nyquist, 413 U.S. at 790–91. T he Court distinguished Walz v. Tax Commission, 397 U.S. 664, 666–67 (1970),
discussed infra notes 153 to 155 and accompanying text, by noting, as one relevant factor, that the tax exemption in
Walz “ covered all property devoted to religious, educational, or charitable purposes,” while the tax benefits in Nyquist
“flow[ed] primarily to the parents of children attending sectarian, nonpublic schools.” Nyquist, 413 U.S. at 794.
140 Zelman, 536 U.S. at 662.
141 Cf., e.g., Religious Restrictions on Capital Financing for Historically Black Colleges and Universities, slip op. at 14
(Op. O.L.C. Aug. 15, 2019), https://www.justice.gov/olc/file/1200986/download (expressing “ doubt about whether
Tilton and Nyquist remained good law”).
142 See, e.g., Green v. Garriot, 212 P.3d 96, 117 (Ariz. Ct. App. 2009) (Kessler, J., dissenting) (“[I]t is the lack of any
tax benefit to parents sending their children to public schools which further distinguishes this case from Zelm an and
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invalid even if the program is facial y neutral with respect to religion, if the program assists only
private schools and primarily assists religious schools.143 However, the Supreme Court’s
statement in Zelman suggests that a program assisting only private entities might nonetheless be
constitutional so long as the program is otherwise neutral toward religion,144 and some lower
courts have upheld indirect aid programs that funnel funds to both secular and religious private
organizations.145 Further, in a more recent case primarily involving a Free Exercise chal enge, the
Supreme Court said that an Establishment Clause chal enge to a state tax benefit program
indirectly assisting only private schools would be “unavailing,”146 further suggesting that Nyquist
likely no longer provides support for a chal enge based on the fact that a state program aids only
private schools.
Entanglement
Apart from Lemon’s purpose and effect prongs, direct financial aid to religious entities may also
be unconstitutional if it violates the excessive entanglement prong. In Lemon itself, the Supreme
Court struck down two state programs that provided money to religious schools for teachers’
salaries after concluding that the programs “foster[ed] an impermissible degree of
entanglement.”147 The Court expressed particular concern about the fact that one of the programs
provided money directly to schools, saying that historical y, programs involving “a continuing
cash subsidy . . . have almost always been accompanied by varying measures of [government]
control and surveil ance,” creating an unconstitutional “intimate and continuing relationship
between church and state.”148 With respect to both programs, the Court also expressed concern
about the “divisive political potential” and the relatively unprecedented nature of the programs,
stating that these factors might suggest a danger of even greater government regulation of
religious schools in the future.149 General y, the Court has expressed concern about pervasive
government monitoring of religious entities.150
The Supreme Court has also acknowledged that it is necessary for the state to monitor the use of
public funds to ensure they are being used appropriately, and the Court has approved of some
systems that do not require the government to “intrude unduly in the day-to-day operation” of
religious entities.151 The Court has suggested that the types of “administrative burdens” associated

makes it more comparable to Nyquist.”).
143 See, e.g., Winn v. Ariz. Christian Sch. T uition Org., 562 F.3d 1002, 1005 (9th Cir. 2009), rev’d on other grounds
sub nom ., 563 U.S. 125 (2011); Espinoza v. Mont. Dep’t of Revenue, 435 P.3d 603, 620 (Mont. 2018) (Gustafson, J.,
concurring), rev’d, 140 S. Ct. 2246 (2020); cf., e.g., Am. Atheists, Inc. v. City of Detroit Downtown Dev. Auth., 567
F.3d 278, 298 (6th Cir. 2009) (ruling that Nyquist did not require invalidation of a program in which “ [o]nly 6% of the
aid distributed by the city went to reimbursement grants for religious organizations”).
144 Zelman, 536 U.S. at 662.
145 See, e.g., Freedom from Religion Found., Inc. v. McCallum, 324 F.3d 880, 882–83 (7th Cir. 2003) (rejecting
Establishment Clause challenge to program in which the state contracted with various halfway houses, including one
religious organization, but the probationer or parolee chose which halfway house program to join).
146 Espinoza v. Mont. Dep’t of Revenue, 140 S. Ct. 2246, 2254 (2020).
147 Lemon v. Kurtzman, 403 U.S. 602, 615 (1971).
148 Id. at 621–22.
149 Id. at 622–24.
150 Agostini v. Felton, 521 U.S. 203, 234 (1997).
151 Bowen v. Kendrick, 487 U.S. 589, 616 (1988). See also Comm. for Pub. Educ. & Religious Liberty v. Regan, 444
U.S. 646, 660 (1980) (“We agree with the District Court that ‘[t]he services for which the private schools would be
reimbursed are discrete and clearly identifiable.’ T he reimbursement process, furthermore, is straightforward and
susceptible to the routinization that characterizes most reimbursement schemes.” (alteration in original) (quoting
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with “general y applicable administrative and recordkeeping regulations” do not violate the
Establishment Clause.152 For example, in Walz v. Tax Commission, the Supreme Court concluded
that New York could exempt churches from property taxes under a state provision that exempted
property used “exclusively for religious, educational or charitable purposes.”153 The Court
acknowledged that the exemption would create some degree of government entanglement with
religion by giving churches “an indirect economic benefit,” but stated that the exemption entailed
less government involvement than either taxing the churches or giving them a direct money
subsidy.154 Ultimately, the Court ruled that the exemption created “only a minimal and remote
involvement between church and state.”155
Free Exercise Clause
General Background
The Free Exercise Clause of the First Amendment provides that the government “shal make no
law . . . prohibiting the free exercise” of religion.156 The Supreme Court has said that general y,
the government may not “target[] religious beliefs as such”157 or otherwise “base laws or
regulations on hostility to a religion or religious viewpoint.”158 Further, if a law “infringe[s] upon
or restrict[s] practices because of their religious motivation,” it wil be subject to strict scrutiny
and “invalid unless it is justified by a compel ing interest and is narrowly tailored to advance that
interest.”159 For example, in Church of Lukumi Babalu Aye v. City of Hialeah, the Supreme Court
held that a local ordinance prohibiting certain types of animal sacrifice violated the Free Exercise
Clause because the purpose of the law was to suppress certain religious practices.160 However, if
the burden on free exercise is “merely the incidental effect of a general y applicable and
otherwise valid provision,” the Supreme Court has said that such a law wil not violate the First
Amendment.161
As discussed in more detail below, aid programs that expressly exempt religious entities are not
facial y neutral toward religion, and consequently, are susceptible to the charge that they
unconstitutional y “single out the religious for disfavored treatment.”162 Even though a denial of a
benefit is arguably less burdensome to religious exercise than, for example, completely
prohibiting a religious activity, the Court has recognized that “indirect coercion or penalties on
the free exercise of religion, not just outright prohibitions, are subject to scrutiny under the First

Comm. for Pub. Educ. & Religious Liberty v. Levitt, 461 F. Supp. 1123, 1131 (S.D.N.Y. 1978))).
152 Jimmy Swaggart Ministries v. Bd. of Equalization, 493 U.S. 378, 394 –95 (1990).
153 Walz v. T ax Comm’n, 397 U.S. 664, 666–67 (1970).
154 Id. at 674–75.
155 Id. at 676 (“T he exemption creates only a minimal and remote invo lvement between church and state and far less
than taxation of churches. It restricts the fiscal relationship between church and state, and tends to complement and
reinforce the desired separation insulating each from the other.”).
156 U.S. CONST. amend. I.
157 Church of Lukumi Babalu Aye, Inc. v. City of Hialeah, 508 U.S. 520, 533 (1993).
158 Masterpiece Cakeshop, Ltd. v. Colo. Civil Rights Comm’n, 138 S. Ct. 1719, 1731 (2018).
159 Church of Lukumi Babalu Aye, 508 U.S. at 533.
160 Id. at 534.
161 Emp’t Div., Dep’t of Human Res. of Or. v. Smith, 494 U.S. 872, 878 (1990).
162 See T rinity Lutheran Church of Columbia, Inc. v. Comer, 137 S. Ct. 2012, 2020 (2017).
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Amendment.”163 But the Supreme Court has recognized that certain religious exclusions are
permissible if they are justified by historical y supported “antiestablishment” interests:
constitutional y grounded concerns about not supporting religion.164
Religious Exclusions from Aid
There are three primary Supreme Court cases in which plaintiffs have chal enged religion-based
exclusions from general y available grant programs under the Free Exercise Clause165: Locke v.
Davey, a 2004 case in which the Supreme Court upheld the exclusion;166 and Trinity Lutheran
Church of Columbia, Inc. v. Comer167 in 2017 and Espinoza v. Montana Department of
Revenue168 in 2020, cases in which the Supreme Court held that the exclusions were
unconstitutional.
First, in Locke v. Davey, the Court considered a Free Exercise chal enge to a state scholarship
program for postsecondary educational expenses.169 While students could use the scholarship at
religious schools, they could not use the scholarship to pursue a “degree in devotional
theology.”170 This exclusion was based on a state constitutional provision that prohibited the state
from appropriating public money for religious instruction.171 A student who was denied the
scholarship because he was seeking a “pastoral ministries” degree argued that the program was
“presumptively unconstitutional because it [was] not facial y neutral with respect to religion.”172
The Supreme Court disagreed,173 concluding that nothing “in the history or text” of the state
constitution or “the operation of” the scholarship program “suggest[ed] animus toward
religion.”174 As opposed to the evidence of discrimination against religion in Church of Lukumi
Babalu Aye, the Locke Court viewed the program’s “disfavor of religion (if it can be cal ed that)”
to be of a “far milder kind.”175 Among other factors, the Court noted that the program did not
impose any sanctions on religious exercise and did not “require students to choose between their
religious beliefs and receiving a government benefit.”176 To the contrary, the majority opinion

163 Lyng v. Nw. Indian Cemetery Protective Ass’n, 485 U.S. 439, 450 (1988). Cf., e.g., McDaniel v. Paty, 435 U.S.
618, 629 (1978) (holding that a state law prohibiting ministers and priests from participating in a state constitutional
convention violated the Free Exercise Clause).
164 See Locke v. Davey, 540 U.S. 712, 720–22 (2004); cf., e.g., Rosenberger v. Rector & Visitors of the Univ. of Va.,
515 U.S. 819, 837, 842 (1995) (considering but ultimately rejecting claim that Establishment Clause justified free
speech violation by requiring the defendant school to prohibit religious uses of its facilities).
165 Cf., e.g., Sherbert v. Verner, 374 U.S. 398, 409 (1963) (ruling that disqualifying a Seventh -day Adventist from
unemployment benefits because she would not work on Saturday unconstitutionally burdened the applicant’s free
exercise of religion).
166 540 U.S. at 724.
167 137 S. Ct. at 2024.
168 Espinoza v. Mont. Dep’t of Revenue, 140 S. Ct. 2246, 2255 (2020).
169 540 U.S. at 715.
170 Id. at 716–17.
171 See id. at 715; WASH. CONST. art. I, § 11 (“No public money or property shall be appropriated for or applied to any
religious worship, exercise or instruction, or the support of any religious establishment . . . .”).
172 Locke, 540 U.S. at 717, 720.
173 Id. at 720 (“ We reject his claim of presumptive unconstitutionality . . . .”).
174 Id. at 724.
175 Id. at 720.
176 Id. at 720–21.
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stated that the program went “a long way toward including religion in its benefits,” given that
students could use the scholarship at religious schools and for religious courses.177
The Locke Court stated that the devotional-theology exclusion was not required by the
Establishment Clause.178 The scholarship program was an indirect aid program: the state provided
the funds to students, who could then choose how to use the funds.179 Accordingly, it would not
violate the Establishment Clause if the state did al ow scholarship students to pursue devotional
theology degrees.180 But ultimately, in the Court’s view, the state could permissibly choose not to
fund religious training, “an essential y religious endeavor.”181 The state’s decision to treat
“religious education for the ministry” differently than “education for other cal ings” was “a
product of” the state’s historical y grounded opposition to government establishment of religion,
“not evidence of hostility toward religion.”182 Accordingly, the Court concluded that the
“relatively minor burden” on scholarship students was acceptable in light of the state’s
“substantial” “interest in not funding the pursuit of devotional degrees.”183
By contrast, in Trinity Lutheran Church of Columbia v. Comer, the Supreme Court held that a
state grant program that excluded religious organizations from a general grant program violated
the Free Exercise Clause.184 The state program in Trinity Lutheran offered grants to nonprofit
organizations for upgrading playground surfaces, but excluded organizations “owned or
controlled by a . . . religious entity.”185 This policy was, like the Locke exclusion, based on a state
constitutional provision prohibiting public funds from being used “directly or indirectly, in aid of
any church, sect or denomination of religion.”186 Unlike the program in Locke, which “did not
‘require students to choose between their religious beliefs and receiving a government benefit,’”
the Supreme Court said that the playground grant program unconstitutional y put religious
organizations “to the choice between being a church and receiving a government benefit.”187
According to the Court, the student in Locke, unlike the religious school applying for a
playground grant, “was not denied a scholarship because of who he was; he was denied a
scholarship because of what he proposed to do—use the funds to prepare for the ministry.”188
Consequently, because the program required an organization “to renounce its religious character
in order to participate in an otherwise general y available public benefit program,” the Supreme
Court said that the state imposed “a penalty on the free exercise of religion that must be subjected

177 Id. at 724–25.
178 Id. at 719.
179 Id.
180 Id.
181 Id. at 721.
182 Id.; see also id. at 722–23 (discussing historical opposition to “using tax funds to support the ministry”).
183 Id. at 725.
184 T rinity Lutheran Church of Columbia, Inc. v. Comer, 137 S. Ct. 2012, 2024 (2017).
185 Id. at 2017.
186 Id. (quoting MO. CONST. art. I, § 7).
187 Id. at 2024 (quoting Locke, 540 U.S. at 720–21).
188 Id. at 2023. Concurring in the Court’s judgment in Trinity Lutheran, Justice Gorsuch questioned the Court’s
apparent attempt to draw a distinction “ between laws that discriminate on the basis of religious status and religious
use.” Id. at 2025 (Gorsuch, J., concurring). Among other objections, he noted that the First Amendment “ guarantees the
free exercise of religion, not just the right to inward belief (or status).” Id. at 2026. Justice Gorsuch also questioned “ t he
stability of such a line,” suggesting that it could be difficult to determine the distinction between religious status and
religious activity. Id. at 2025.
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to the ‘most rigorous’ scrutiny.”189 It could only be justified by “a state interest ‘of the highest
order.’”190 In these circumstances, the Court held that the state’s “policy preference for skating as
far as possible from religious establishment concerns” did not “qualify as compel ing.”191
In a footnote that only three other Justices joined, Chief Justice Roberts, who wrote the majority
opinion, described the decision as involving “express discrimination based on religious identity
with respect to playground resurfacing”—raising the question of whether the opinion extended to
“religious uses of funding or other forms of discrimination.”192 In the wake of Trinity Lutheran,
legal commentators questioned whether Chief Justice Roberts’s footnote limiting the decision to
discrimination “with respect to playground resurfacing” was an attempt to suggest that the ruling
applied only to programs with “no direct religious content” that provided only secular benefits.193
The Supreme Court, however, clarified Trinity Lutheran’s scope in Espinoza v. Montana
Department of Revenue, holding that the nondiscrimination principle also applies to indirect aid
programs that fund religious activities.194 Espinoza involved a state program offering tax credits
for donating to private organizations that granted scholarships to private schools, including
religious schools.195 The Montana Supreme Court had invalidated the tax credit program, holding
that it violated a state constitutional provision known as the No-Aid Clause that prohibited the
government from providing direct or indirect financial support to religious schools.196 The state
argued that Trinity Lutheran should not apply because the No-Aid Clause excluded religious
schools based on how they would use the funds—for religious education.197 The Supreme Court
disagreed, pointing to the text of the No-Aid Clause, which singled out “sectarian” schools, and
observing that the state supreme court had applied the clause “solely by reference to religious
status.”198 Distinguishing Locke, the Court emphasized that Montana had not merely excluded
any “particular ‘essential y religious’ course of instruction,” but barred al aid to religious
schools.199 Further, unlike the “‘historical and substantial’ state interest in not funding the training
of clergy” at issue in Locke, the Court stated that there was no similar historical y grounded
interest in wholly disqualifying religious schools from public aid.200

189 Id. at 2024 (majority opinion) (quoting Church of Lukumi Babalu Aye v. City of Hialeah, 508 U.S. 520, 546
(1993)).
190 Id. (quoting McDaniel v. Paty, 435 U.S. 618, 628 (1978)).
191 Id.
192 Id. at 2024 n.3 (plurality opinion).
193 Frank Ravitch, T rinity Lutheran and Zelman – Saved By Footnote 3 or a Dream Come True for Voucher
Advocates?, SCOT USBlog (June 26, 2017), https://www.scotusblog.com/2017/06/symposium-trinity-lutheran-church-
v-comer-zelman-v-simmons-harris-saved-footnote-3-dream-come-true-voucher-advocates.
194 Espinoza v. Mont. Dep’t of Revenue, 140 S. Ct. 2246, 2252 (2020).
195 Id. at 2251.
196 Id. at 2253. T he challengers described this provision as a “Blaine Amendment” and argued that the constitutional
provision was motivated by anti-Catholic animus—an issue that the majority opinion did not address. See id. at 704–05
(Alito, J., concurring). See also, e.g., Locke v. Davey, 540 U.S. 712, 723 n.7 (2004) (noting arguments that the state
constitution “was born of religious bigotry” but stating that because the specific constitutional provision challenged in
that case was not a Blaine Amendment, the Court would not consider this history of possible animus).
197 Espinoza, 140 S. Ct. at 2255.
198 Id. at 2255–56. T he majority opinion in Espinoza acknowledged Justice Gorsuch’s Trinity Lutheran dissent
questioning “ whether there is a meaningful distinction between discrimination based on use or conduct and that based
on status.” Id. at 2257. However, the Court concluded it did not need to examine this issue because the Montana
program did discriminate based on religious status. Id.
199 Id. at 2257.
200 Id. at 2257–58.
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Because the No-Aid Clause “discriminate[d] based on religious status,”201 the Supreme Court
applied strict scrutiny to analyze its application to religious schools and parents.202 Following
Trinity Lutheran, the Court said that the state’s interest in separating church and state beyond
what was required by the federal Establishment Clause was insufficiently compel ing.203 The
Court also rejected Montana’s arguments that the No-Aid Clause promoted religious freedom by
protecting taxpayers’ religious liberty and “keeping the government out of” the operations of
religious organizations.204 The Court did “not see how” denying religious organizations the option
to participate in the government program promoted religious liberty.205 And in response to
Montana’s claim that the No-Aid Clause advanced the state’s interest in supporting public
education, the Court ruled that the provision was “fatal y underinclusive,” as it excluded only
religious private schools and stil al owed public support to be diverted to nonreligious private
schools.206
Implications for Congress
As discussed, the inclusion of religious organizations in federal aid programs can raise
constitutional questions under both the Establishment and Free Exercise Clauses of the First
Amendment. The Supreme Court’s jurisprudence interpreting these two provisions limits both
Congress’s ability to include religious organizations in federal aid programs and to exclude them
from such programs. While providing funds to religious organizations implicates the
Establishment Clause,207 the Court has upheld direct aid programs that prevent government funds
from being used for religious indoctrination.208 The Court has also upheld indirect aid programs
that provide funds to third parties who may independently choose to direct that money to
religious organizations.209 By contrast, excluding religious organizations from otherwise generaly
available government benefits implicates the Free Exercise Clause, and categorical exclusions
from direct or indirect aid programs based on religious status are likely unconstitutional.210 More
limited restrictions on religious uses of funding might not violate the Free Exercise Clause.211
There are a variety of federal statutes and regulations that govern the provision of funds to
religious organizations that participate in specific federal programs. In addition to Supreme Court
precedent interpreting the First Amendment, federal agencies and others subject to these federal
laws wil have to follow any applicable statutes or regulations governing the use of federal funds.

201 Id. at 2257.
202 Id. at 2260. T he Court did not hold that this state constitutional provision was facially unconstitutional, but
concluded that the No-Aid Clause could not be applied in a way that excluded religious schools based solely on their
religious status. Id. at 2256, 2260. However, some of the language in the opinion referred to the No -Aid Clause as a
whole. See, e.g., id. at 2257 (“ Montana’s no-aid provision discriminates based on religious status.”).
203 Id. at 2260.
204 Id.
205 Id. at 2261.
206 Id.
207 E.g., Lemon v. Kurtzman, 403 U.S. 602, 613–14 (1971).
208 Mitchell v. Helms, 530 U.S. 793, 840 (2000) (O’Connor, J., concurring in the judgment); see also, e.g., Bowen v.
Kendrick, 487 U.S. 589, 602 (1988).
209 E.g., Zelman v. Simmons-Harris, 536 U.S. 639, 649 (2002).
210 T rinity Lutheran Church of Columbia, Inc. v. Comer, 137 S. Ct. 2012, 2020 (2017).
211 E.g., Locke v. Davey, 540 U.S. 712, 721 (2004).
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General y, federal laws such as the so-cal ed “Charitable Choice”212 statutes appear to track the
constitutional principles outlined above, al owing religious organizations to receive federal funds
on the same basis as non-religious organizations, but placing some limitations on the use of those
funds to ensure they do not support certain religious activities.213
However, Congress may nonetheless review federal laws in light of Supreme Court precedent
trending toward greater inclusion of religious organizations in public funding and requiring
religious exclusions to be more narrowly tailored to historical y justified interests around specific
religious activities.214 In particular, the Trump Administration has taken the position that some
funding restrictions found in federal statutes and regulations are no longer constitutional in light
of the Supreme Court’s decision in Trinity Lutheran.215 The Administration has changed some
executive branch policies216 and issued legal opinions expressing its views in favor of greater
inclusion of religious organizations.217
For example, in January 2020, nine agencies proposed amendments to their regulations governing
the provision of federal funds to religious organizations.218 Among other changes, these agencies
removed regulations requiring faith-based organizations to refer potential beneficiaries who

212 See, e.g., President George W. Bush, Charitable Choice: The Facts, T HE WHITE HOUSE (last visited Sept. 9, 2020),
https://georgewbush-whitehouse.archives.gov/government/fbci/guidance/charitable.html (“ T he Charitable Choice laws
[enacted between 1996 and 2000] apply to four Federal programs: T emporary Assistance to Needy Families . . . and the
Community Services Block Grant . . . programs . . . ; programs for substance abuse and mental health . . . ; and the
Welfare-to-Work program . . . .”); see also, e.g., Pub. L. No. 104-193, § 104, 110 Stat. 2105, 2161 (1996) (codified at
42 U.S.C. § 604a).
213 Cf., e.g., Michele Estrin Gilman, “Charitable Choice” and the Accountability Challenge: Reconciling the Need for
Regulation with the First Am endm ent Religion Clauses, 55 VAND. L. REV. 799, 807–08 (2002) (“The charitable choice
provision [42 U.S.C. § 604a] contains several requirements designed to ease First Amendment church -state separation
concerns while simultaneously preserving the religious character of the grantees.”).
214 See, e.g., Espinoza v. Mont. Dep’t of Revenue, 140 S. Ct. 2246, 2257–58 (2020).
215 See T rinity Lutheran Church of Columbia, Inc. v. Comer, 137 S. Ct. 2012, 2019 (2017).
216 See, e.g., News Release, FEMA Expands Public Assistance Eligibility to Include Houses of Worship , FEMA (Jan. 2,
2018), https://www.fema.gov/news-release/2018/01/02/fema-expands-public-assistance-eligibility-include-houses-
worship (announcing policy change making “ houses of worship” eligible for disaster assistance).
217 See, e.g., Religious Restrictions on Capital Financing for Historically Black Colleges and Universities, slip op. at 28
(Op. O.L.C. Aug. 15, 2019), https://www.justice.gov/olc/file/1200986/download (arguing that two statutes governing
the provision of federal funds to historically black colleges and universities would be unconstitutional insofar as they
could be read to exclude schools based on their religious character); Memorandum from Attorney General Sessions to
All Executive Departments and Agencies, Federal Law Protections for Religious Liberty (Oct. 6, 2017),
https://www.justice.gov/opa/press-release/file/1001891/download (generally explaining views on constitutional issues).
218 Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards, 85 Fed. Reg.
3190 (proposed Jan. 17, 2020) (to be codified at 2 C.F.R. pt. 3474 & 34 C.F.R. pts. 75–76, 106, 606–09); Equal
Participation of Faith-Based Organizations in DHS’s Programs and Activities, 85 Fed. Reg. 2889 (proposed Jan. 17,
2020) (to be codified at 6 C.F.R. pt. 19); Equal Opportunity for Religious Organizations in U.S. Department of
Agriculture Programs, 85 Fed. Reg. 2897 (proposed Jan. 17, 2020) (to be codified at 7 C.F.R. pt. 16); Equal
Participation of Faith-Based Organizations in USAID’s Programs and Activities, 85 Fed. Reg. 2916 (proposed Jan. 17,
2020) (to be codified at 22 C.F.R. pt. 205); Equal Participation of Faith-Based Organizations in HUD Programs and
Activities, 85 Fed. Reg. 8215 (proposed Feb. 13, 2020) (to be codified at 24 C.F.R. pts. 5, 92, 578); Equal Participation
of Faith-Based Organizations in Department of Justice’s Programs and Activities, 85 Fed. Reg. 2921 (proposed Jan. 17,
2020) (to be codified at 28 C.F.R. pt. 38); Equal Participation of Faith -Based Organizations in the Department of
Labor’s Programs and Activities, 85 Fed. Reg. 2929 (proposed Jan. 17, 2020) (to be codified at 29 C.F.R. pt. 2); Equal
Participation of Faith-Based Organizations in Veterans Affairs Programs, 85 Fed. Reg. 2938 (proposed Jan. 17, 2020)
(to be codified at 38 C.F.R. pts. 50, 61–62); Ensuring Equal T reatment of Faith-Based Organizations, 85 Fed. Reg.
2974 (proposed Jan. 17, 2020) (to be codified at 45 C.F.R. pts. 87, 1050). T hese proposed amendments reflected
principles set out in Executive Order No. 13,831, 83 Fed. Reg. 20,715 (May 3, 2018), which amended prior executive
orders setting out the principles that should guide agencies providing federal funds to faith -based organizations.
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objected to receiving religious services to alternative service providers.219 The agencies argued
that imposing additional referral burdens on faith-based service providers, but not secular
providers, unconstitutional y discriminated against faith-based organizations.220 In another
example, the Smal Business Administration (SBA) announced in April 2020 that faith-based
organizations, including houses of worship, would be eligible to receive loans under the
Coronavirus Aid, Relief, and Economic Security Act.221 Although preexisting SBA regulations
excluded certain religious entities from its loan programs, the SBA concluded that those
regulations “impermissibly . . . . bar[red] the participation of a class of potential recipients based
solely on their religious status,” saying that the SBA would no longer enforce those regulations.222
While the executive branch’s views on the First Amendment are not binding on Congress or the
courts, congressional awareness of the Administration’s positions aids understanding of how
legislative schemes are being implemented and keeps Congress apprised of prevailing
interpretations of the Free Exercise Clause. Congress also has an interest in ensuring that federal
funds are not supporting religious activities in ways that would violate the Establishment
Clause.223
General y, as discussed in more detail above, financial aid programs in the form of tax
exemptions and indirect grant programs are unlikely to violate the Establishment Clause unless
the aid is preferential y given only to religious organizations or activities, or other evidence
demonstrates an impermissible purpose to support religion.224 Thus, for example, federal law
creates a tax exemption for religious, charitable, educational, and other nonprofit organizations in
26 U.S.C. § 501(c)(3).225 On its face, this exemption appears similar to the state tax exemption
upheld by the Court in Walz226—although some plaintiffs have (unsuccessful y) attempted to
argue that certain applications of this tax exemption violate the Establishment Clause by favoring

219 See, e.g., Uniform Administrative Requirements, Cost Principles, and Audit Requirements, 85 Fed. Reg. at 3193.
220 See, e.g., Ensuring Equal T reatment of Faith-Based Organizations, 85 Fed. Reg. at 2976.
221 SMALL BUS. ADMIN., FREQUENTLY ASKED QUESTIONS REGARDING PARTICIPATION OF FAITH-BASED ORGANIZATIONS
IN THE P AYCHECK P ROTECTION P ROGRAM (PPP ) AND THE ECONOMIC INJURY DISASTER LOAN P ROGRAM (EIDL) (2020),
https://www.sba.gov/sites/default/files/2020-06/SBA%20Faith-Based%20FAQ%20Final-508.pdf.
222 Id. at 1; see also CRS Legal Sidebar LSB10445, Eligibility of Religious Organizations for the CARES Act’s
Paycheck Protection Program , by Valerie C. Brannon.
223 See generally, e.g., CRS Report R45442, Congress’s Authority to Influence and Control Executive Branch Agencies,
by T odd Garvey and Daniel J. Sheffner.
224 Compare Zelman v. Simmons-Harris, 536 U.S. 639, 653 (2002) (rejecting Establishment Clause challenge to
indirect aid program, noting that the program was open to religious and nonreligious schools, including public schools),
and Walz v. T ax Comm’n, 397 U.S. 664, 672–73 (1970) (rejecting Establishment Clause challenge to state tax
exemption for religious, educational and charitable organizations, noting t hat the exemption did “ not single[] out one
particular church or religious group or even churches as such ”), with T ex. Monthly, Inc. v. Bullock, 489 U.S. 1, 17
(1989) (plurality opinion) (ruling state tax exemption for only religious periodicals unconstitutional), and Comm. for
Pub. Educ. & Religious Liberty v. Nyquist, 413 U.S. 756, 794 (1973) (ruling indirect assistance unconstitutional where
the benefits “ flow[ed] primarily to the parents of children attending sectarian, nonpublic schools”).
225 26 U.S.C. § 501(c)(3).
226 Walz, 397 U.S. at 672–73. See also Fields v. United States, No. 96-317, 1998 U.S. Dist. LEXIS 5558, at *5 (D.D.C.
Mar. 25, 1998) (rejecting argument that determining the tax exempt status of religious organizations violates the
Establishment Clause, noting that “ courts have repeatedly sanctioned the use of § 501(c)(3)”).
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certain religious beliefs227 or creating an excessive entanglement with religion.228 The Internal
Revenue Service (IRS) does treat houses of worship more favorably than other § 501(c)(3)
organizations in at least one respect.229 Nonprofit organizations general y must notify the IRS that
they are applying for tax-exempt status.230 Churches, however, are not subject to this notification
requirement and are instead automatical y considered tax exempt by the IRS.231 Although some
plaintiffs have attempted to chal enge this seemingly preferential treatment as violating the
Establishment Clause, courts have so far dismissed those claims on procedural grounds.232
Turning to indirect aid such as voucher programs, the Supreme Court has said that programs of
“genuine and independent private choice” are “not readily subject to chal enge under the
Establishment Clause.”233 Consistent with this distinction, federal regulations governing the
participation of religious organizations in federal programs treat direct and indirect aid programs
differently.234 For example, while regulations promulgated by the Department of Health and
Human Services (HHS) provide that organizations receiving “direct financial assistance . . . may
not support or engage in any explicitly religious activities . . . as part of the programs or services
funded with direct financial assistance,” this restriction does not apply to the “use of indirect
Federal financial assistance.”235
However, the Trump Administration nonetheless concluded that at least some of these indirect-aid
provisions were insufficiently accommodating of religious organizations. For instance, in January
2020, HHS proposed to amend its regulatory definition of “indirect” assistance.236 The regulation
defined assistance as indirect only if, among other factors, “[t]he beneficiary has at least one
adequate secular option for the use of the voucher, certificate, or other similar means of
Government-funded payment.”237 HHS argued that this requirement for secular options was not
required by Zelman, which in the view of the agency, “noted the availability of secular providers”
in approving the chal enged voucher program, but “specifical y declined to make its definition of
indirect aid hinge on the ‘preponderance of religiously affiliated private’ providers.”238 This

227 See, e.g., Bob Jones Univ. v. United States, 461 U.S. 574, 604 n.30 (1983) (rejecting argument that denying tax
exemption to religious university that discriminated on the basis of race privileged religious beliefs allowing “ racial
intermixing” over the university’s belief that such “intermixing is forbidden,” ruling instead that the IRS
nondiscrimination policy had a neutral, secular basis).
228 See, e.g., Church of Scientology v. Comm’r, 83 T .C. 381, 462 (1984), aff’d, 823 F.2d 1310 (9th Cir. 1987).
229 Cf., e.g., Am. Atheists, Inc. v. Shulman, 21 F. Supp. 3d 856, 859–61 (E.D. Ky. 2014) (identifying a number of
provisions in the federal tax code that allegedly discriminate in favor of churches).
230 26 U.S.C. § 508(a).
231 26 U.S.C. § 508(c)(1)(A); IRS, T AX GUIDE FOR CHURCHES AND RELIGIOUS ORGANIZATIONS 2 (2015),
https://www.irs.gov/pub/irs-pdf/p1828.pdf. However, the governing statute contemplates that some nonreligious
organizations may also be exempt from the notification requirement. 26 U.S.C. § 508(c)(1)(B), (2) (exempting certain
small organizations and authorizing the Secretary to exempt other organizations).
232 See Freedom from Religion Found. v. Koskinen, 72 F. Supp. 3d 963 , 964 (W.D. Wis. 2014) (dismissing claim for
lack of standing); Am . Atheists, Inc, 21 F. Supp. 3d at 872 (ruling that although plaintiffs sufficiently alleged an
Establishment Clause challenge, they lacked standing).
233 Zelman v. Simmons-Harris, 536 U.S. 639, 652 (2002).
234 See, e.g., 45 C.F.R. § 87.3.
235 Id. § 87.3(b). HHS has proposed to delete the language prohibiting organizations receiving direct assistance from
“support[ing]” explicitly religious activities. Ensuring Equal T reatment of Faith-Based Organizations, 85 Fed. Reg.
2974, 2985 (proposed Jan. 17, 2020) (to be codified at 45 C.F.R. § 87.3(b)).
236 Ensuring Equal T reatment of Faith-Based Organizations, 85 Fed. Reg. at 2985 (to be codified at 45 C.F.R.
§ 87.1(c)).
237 45 C.F.R. § 87.1(c).
238 Ensuring Equal T reatment of Faith-Based Organizations, 85 Fed. Reg. at 1977 (quoting Zelman, 536 U.S. at 656–
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reading of Zelman seems to implicate the open question discussed above about the continuing
validity of the Nyquist decision, which ruled an indirect aid program subsidizing only private
schools—and primarily aiding religious schools—unconstitutional.239 The Zelman Court
distinguished Nyquist in part by noting that the program in Nyquist supported only private
schools, suggesting that programs with an impermissible purpose or effect of supporting religious
schools would remain unconstitutional.240 Accordingly, a federal indirect assistance program that
only al ows beneficiaries to choose religious organizations might stil be subject to an
Establishment Clause chal enge as an unconstitutional preference for religion.241
Federal programs that provide money directly to religious organizations may present more
significant constitutional problems under the Establishment Clause.242 With respect to direct aid
programs, restrictions that prevent public funds from being used for religious activities may help
ensure that the program satisfies Establishment Clause scrutiny.243 A number of program-specific
federal statutes state that federal funds may not be used for religious worship or instruction.244
Somewhat similar to the state law at issue in Locke v. Davey,245 a number of federal statutes seek
to ensure that federal funds wil not benefit schools of divinity at higher education institutions.246
Other statutes prohibit the use of funds to construct or maintain buildings in which religious
instruction or worship occurs.247 These construction and maintenance prohibitions seem to echo
Supreme Court decisions like Hunt v. McNair and others that rejected Establishment Clause
chal enges to government programs that contained similar restrictions prohibiting public funds
from being used for religious facilities.248
More recent Supreme Court precedent suggests that such restrictions might be unnecessary even
in direct aid programs,249 at least so long as there is no specific evidence showing that funds wil
be used for religious activities and there is some mechanism for the government to ensure funds
are not used to advance religion.250 And as discussed, language in more recent cases could be read
to suggest that if a program is open to both religious and nonreligious groups, it wil be
considered neutral and wil not be considered to have an impermissible effect.251 As with tax
exemptions and indirect aid programs, however, preferential aid only provided for religious

57).
239 See Comm. for Pub. Educ. & Religious Liberty v. Nyquist, 413 U.S. 756, 798 (1973).
240 Zelman, 536 U.S. at 661 (“ Nyquist involved a New York program that gave a package of benefits exclusively to
private schools and the parents of private school enrollees. . . . [T ]he program flatly prohibited the participation of any
public school, or parent of any public school enrollee.”).
241 Cf. id. at 662 (noting that the program challenged in Zelman allowed beneficiaries “to exercise genuine choice
among options public and private, secular and religious”).
242 See, e.g., Mitchell v. Helms, 530 U.S. 793, 818–19 (2000) (plurality opinion); id. at 840 (O’Connor, J., concurring).
243 Hunt v. McNair, 413 U.S. 734, 736 (1973).
244 See, e.g., 20 U.S.C. § 1011k(c); 34 U.S.C. § 12161(b)(B)(iv); 42 U.S.C. § 290kk -2; 42 U.S.C. § 9920(c).
245 Locke v. Davey, 540 U.S. 712, 715 (2004).
246 See, e.g., 20 U.S.C. § 1062(c); id. § 1103e(1). Cf., e.g., 25 U.S.C. § 278a (“Funds appropriated . . . to the Secretary
of the Interior for the education of Indian children shall not be used for the education of such children in elementary
and secondary education programs in sectarian schools.”).
247 See, e.g., 20 U.S.C. § 1087-53(b)(1)(C); 20 U.S.C. § 10004(c)(3); 25 U.S.C. § 1813(e); 29 U.S.C. § 3248.
248 Hunt v. McNair, 413 U.S. 734, 736 (1973); see also supra note 110.
249 Bowen v. Kendrick, 487 U.S. 589, 614 (1988); Agostini v. Felton, 521 U.S. 203, 224 (1997).
250 Bowen, 487 U.S. at 615.
251 See Mitchell v. Helms, 530 U.S. 793, 810, 818 (2000) (plurality opinion).
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organizations or activities would likely violate the purpose or effect prongs of Lemon.252 Further,
government monitoring of direct aid programs may violate Lemon’s entanglement prong if a
program requires the government to become involved in a religious organization’s “day-to-day
operation[s]”253 or inquire into the organization’s religious doctrine.254
In summary, Congress may consider reviewing existing law to ensure that it is consistent with
recent Supreme Court cases ruling that funding restrictions discriminating against religious
entities may violate the Free Exercise Clause.255 Further, while Congress cannot alter the scope of
the Free Exercise Clause’s protections for religious entities, it can grant additional statutory
protections to religious entities, so long as those protections do not rise to the level of an
unconstitutional establishment.256 Similarly, on the opposite side, although Congress cannot
amend the scope of the Establishment Clause’s restrictions on public support for religious
activities, it may create statutory restrictions on the religious use of funds, so long as those
restrictions do not violate the Free Exercise Clause.

Author Information

Valerie C. Brannon

Legislative Attorney

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This document was prepared by the Congressional Research Service (CRS). CRS serves as nonpartisan
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252 E.g., T ex. Monthly, Inc. v. Bullock, 489 U.S. 1, 17 (1989) (plurality opinion); id. at 28 (Blackmun, J., concurring).
253 Bowen, 487 U.S. at 616.
254 See Hernandez v. Commissioner, 490 U.S. 680, 696–97 (1989).
255 See, e.g., Espinoza v. Mont. Dep’t of Revenue, 140 S. Ct. 2246, 2260 (2020); Masterpiece Cakeshop, Ltd. v. Colo.
Civil Rights Comm’n, 138 S. Ct. 1719, 1731 (2018).
256 See, e.g., 42 U.S.C. § 2000bb-1 (Religious Freedom Restoration Act).
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