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$V WR WKH DELOLW\ RI WKH SODLQWLIIV WR EULQJ WKLV VXLW WKH WRVHSDUDWHUHOLJLRQDQGJRYHUQPHQW´Zelman , 122 S. Ct. at
GLVWULFWFRXUWH[SODLQHGWKDWWKHSODLQWLIIVZHUHIRXQGWRKDYH 2485 (Stevens, J. dissenting opinion); it leaves a gaping hole
VWDQGLQJWREULQJWKLVVXLWDVPXQLFLSDOWD[SD\HUVZKRKDYHDQ in the wall separating church and state.
LQWHUHVWLQSUHYHQWLQJWKHLUORFDOJRYHUQPHQWIURPVXEVLGL]LQJ
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College I, 159 F.3d at 158 (citing Roemer, 426 U.S. at 758 n. LQVWLWXWLRQ EHFDXVH WKH WD[ EDVH RI WKH VWDWH DQG ORFDO
21.) So even though the loan agreement explicitly prohibits JRYHUQPHQWVZDVUHGXFHGE\WKH WD[H[HPSWERQGV7KH\
Lipscomb from using any bond-financed facilities for DVVHUWHG WKDW LI WD[H[HPSW ERQGV KDG QRW EHHQ LVVXHG
religious purposes, there is no way to prevent that from /LSVFRPE8QLYHUVLW\ZRXOGKDYHILQDQFHGDOORUSDUWRIWKH
happening here because of the University’s pervasively SURMHFWWKURXJKWD[DEOHERQGVZKLFKZRXOGKDYHSURYLGHG
religious character. Since the sectarian and secular activities VLJQLILFDQWUHYHQXHIRUWKHFLW\FRIIHUV
at Lipscomb are so inextricably intertwined, the government
cannot avoid excessive entanglement with the sectarian 7KHWD[H[HPSWERQGVGRQRWFRQVWLWXWHDQLQGHEWHGQHVVRI
mission of the University. Agostini, 521 U.S. at 234. HLWKHUWKH%RDUGRUWKH0HWURSROLWDQ*RYHUQPHQW1HLWKHUWKH
Accordingly, the low-interest loan arranged by the Board %RDUGQRUWKH0HWURSROLWDQ*RYHUQPHQWFDQEHKHOGOLDEOHWR
through the issuance of the tax-exempt revenue bonds to SD\DQ\SRUWLRQRIWKHSULQFLSDORULQWHUHVWRQWKHERQGVRUDQ\
Lipscomb results in a violation of the Establishment Clause. FRVWVLQFLGHQWWRWKHLULVVXDQFH7(11&2'($11
Indeed, it is not at all clear that Lipscomb would have been 1RVWDWHRUORFDOJRYHUQPHQWWD[UHYHQXHVKDYH
able to proceed with its construction and renovation project EHHQRUZLOOEHVSHQWDVDUHVXOWRIWKHLVVXDQFHRIWKHERQGV
without the issuance of the tax-exempt revenue bonds;
certainly, the record indicates that it would not have been 7KH GLVWULFW MXGJH RULJLQDOO\ DVVLJQHG WR WKLV FDVH IRXQG
possible to proceed on such financially favorable terms. WKDWHYHQLIQRWD[PRQH\LVVSHQWWD[SD\HUVWDWXVLVSURSHU
JURXQGVIRUDQ(VWDEOLVKPHQW&ODXVHFKDOOHQJHWRSROLFLHVWKDW
The Supreme Court’s recent decision in Zelman, 122 S. Ct. DIIHFWWKHFLW\
VJHQHUDOUHYHQXHIXQG6XPPDU\MXGJPHQWZDV
at 2460, does not alter this conclusion, but indeed supports it. GHQLHG RQ WKRVH JURXQGV DQG RQ LQWHUORFXWRU\ DSSHDO WKH
As noted by the Court in Zelman, "our decisions have drawn 6L[WK &LUFXLW &RXUW RI $SSHDOV XSKHOG WKH GLVWULFW FRXUW¶V
a consistent distinction between government programs that GHFLVLRQ DV WR VWDQGLQJ 6WHHOH Y ,QGXV 'HY %G RI WKH
provide aid directly to religious schools . . . and programs of 0HWUR*RY
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true private choice, in which government aid reaches religious WK&LU XQSXEOLVKHGWDEOHGHFLVLRQ FHUWGHQLHG
schools only as a result of the genuine and independent 866&W/(GG
choices of private individuals." Id. at 2465 (citations :LWK UHJDUG WR WKH PHFKDQLFV RI WKH ERQGV DW LVVXH WKH
omitted.).7KH&RXUWDGGHG GLVWULFWFRXUW¶VGHFLVLRQDJDLQSURYLGHVDWKRURXJKVXPPDU\
0XHOOHU >Y $OOHQ 86 @ :LWWHUV>Y 8QGHU86&>,QWHUQDO5HYHQXH&RGH@JURVV
:DVKLQJWRQ 'HSW RI 6HUYV IRU %OLQG 86 LQFRPH GRHV QRW LQFOXGH LQWHUHVW RQ DQ\ VWDWH RU ORFDO
@DQG=REUHVW>Y&DWDOLQD)RRWKLOOV6FKRRO'LVW ERQGVWKDWDUHERWKSULYDWHDFWLYLW\ERQGVDQGTXDOLILHG
86 @ WKXV PDNH FOHDU WKDW ZKHUH D XQGHU 86&6HH86& D E
JRYHUQPHQW DLG SURJUDP LV QHXWUDO ZLWK UHVSHFW WR $ SULYDWH DFWLYLW\ ERQG LV GHILQHG LQ UHOHYDQW
SDUWXQGHU86&DVDQ\ERQGWKDWLVSDUWRIDQ
LVVXHZKLFKPHHWVWKHSULYDWHORDQILQDQFLQJWHVW
7KH PDMRULW\ RSLQLRQ UXQV WKLV GLVWLQFWLRQ WRJHWKHU FLWLQJ LQ IRRWQRWH 86& D 7KHSULYDWHORDQILQDQFLQJ
WKUHH FDVHV LQYROYLQJ government aid provided directly to religious WHVW LV PHW ZKHUH WKH DPRXQW RI WKH SURFHHGV RI WKH
schools with those involving government aid that reaches religious LVVXHZKLFKDUHWREHXVHG GLUHFWO\RULQGLUHFWO\ WRPDNH
schools through individuals.
6WHHOHHWDOY,QGXVWULDO 1RV 1RV 6WHHOHHWDOY,QGXVWULDO
'HY%GHWDO 'HY%GHWDO
RUILQDQFHORDQVWRSHUVRQVRWKHUWKDQJRYHUQPHQWDO religious organizations from taxes, as it would were it to
XQLWV H[FHHGV WKH OHVVHU RI $ SHUFHQW RI VXFK subsidize them. The exemption simply leaves untouched
SURFHHGV RU % 86& F that which adherents of the organization bring into being
and maintain.
,QRUGHUIRUWKHLQWHUHVWRQWKHERQGVWREHH[HPSWIURP Id. at 693.
IHGHUDOWD[DWLRQWKHSULYDWHDFWLYLW\ERQGVPXVWDOVREH
TXDOLILHG XQGHU 86& H 7KHUH DUH Although no state funds were transferred through the
WKUHHFULWHULDWKDWDERQGLVVXDQFHPXVWPHHWXQGHUWKLV revenue-bond financing employed in this case, the form of
VHFWLRQ )LUVW WKH ERQG PXVW IDOO ZLWKLQ RQH RI WKH state aid at issue, however, exhibits the "affirmative
HQXPHUDWHG FDWHJRULHV $ DQ H[HPSW IDFLOLW\ ERQG involvement characteristic of outright governmental subsidy."
% DTXDOLILHGPRUWJDJHERQG & DTXDOLILHGYHWHUDQV
Id. at 691. Here, the Board and Metro do not play a "passive"
PRUWJDJHERQG ' DTXDOLILHGVPDOOLVVXHERQG ( D role, but rather "affirmatively foster" the activities of
TXDOLILHG VWXGHQW ORDQ ERQG ) D TXDOLILHG Lipscomb by acceding to its request for a low-interest loan
UHGHYHORSPHQWERQGRU * DTXDOLILHG F ERQG funded by tax-exempt revenue bonds. Moreover, the tax-
86& H 6HFRQGWKHERQGLVVXH exempt revenue financing does not "simply leave[] untouched
PXVWPHHWWKHYROXPHFDSUHTXLUHPHQWVRIVHFWLRQ that which adherents of the organization bring into being and
86& H VHHDOVR86& maintain." Id. Instead, the issuance of the low-interest loan
)LQDOO\ WKH ERQG LVVXH PXVW PHHW WKH to the pervasively sectarian educational institution in this case
UHTXLUHPHQWV RI HDFK DSSOLFDEOH VXEVHFWLRQ RI VHFWLRQ "employs the organs of government for essentially religious
86& H 8QGHU WKH SXEOLF purposes" by allowing Lipscomb to fund improvements to its
DSSURYDOUHTXLUHPHQWRIVHFWLRQ I LQRUGHUWREHD University in order to advance its sectarian mission. Id. By
TXDOLILHGERQGDSULYDWHDFWLYLW\ERQGPXVWEHDSSURYHG providing a low-interest loan funded by tax-exempt revenue
E\ERWKWKHJRYHUQPHQWDOXQLWLVVXLQJWKHERQGDQGWKH bonds to a pervasively sectarian educational institution, the
JRYHUQPHQWDOXQLWWKDWKDVMXULVGLFWLRQRYHUWKHDUHDLQ Board and Metro provided the kind of state aid that is
ZKLFKWKHIDFLOLW\UHFHLYLQJILQDQFLQJWKURXJKWKHERQG characteristic of a direct governmental subsidy.
SURFHHGVLVORFDWHG6HH86& I $
Consequently, given Lipscomb’s pervasively sectarian
$ ERQG WKDW PHHWV HDFK RI WKHVH FULWHULD ZLOO EH character, it must be concluded that Lipscomb’s receipt of a
GHVLJQDWHGDVDTXDOLILHGSULYDWHDFWLYLW\ERQGXQGHU direct economic benefit in the form of a low-interest $15
86& :KHUH WKH ERQGV LVVXHG DUH TXDOLILHG million loan resulted in excessive governmental entanglement
SULYDWHDFWLYLW\ERQGVWKHLQWHUHVWIURPWKHERQGVZLOOEH with the religious mission of the University. In view of
H[HPSWIURPIHGHUDOWD[DWLRQ86& Lipscomb’s "character and purposes," Agostini, 521 U.S. at
6WHHOH)6XSSGDW HPSKDVLVDGGHG 232 (quoting Lemon, 403 U.S. at 615), its "secular activities
cannot be separated from sectarian ones." Roemer, 426 U.S.
,QWKHLQVWDQWFDVHWKHERQGVZHUHLVVXHGIRUWKHEHQHILWRI at 755. Because the religious and secular functions are
/LSVFRPE8QLYHUVLW\DSULYDWHHGXFDWLRQDOLQVWLWXWLRQ7KH inseparable at Lipscomb, "no safeguard can ensure that direct
ERQGVZHUHLVVXHGIRUWKHSXUSRVHRIUHQRYDWLQJIDFLOLWLHVRQ monetary aid, even if designated to fund the school’s secular
functions, will not aid its religious mission." Columbia
6WHHOHHWDOY,QGXVWULDO 1RV 1RV 6WHHOHHWDOY,QGXVWULDO
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that a direct economic benefit accrues to such an institution as /LSVFRPE8QLYHUVLW\¶VFDPSXV7KLVPHHWVWKHSULYDWHORDQ
a result of the government’s active participation in arranging ILQDQFLQJWHVWRIVHFWLRQ F EHFDXVHWKHHQWLUHDPRXQWRI
for a low-cost loan that enables the institution to advance its ERQGSURFHHGVORDQHGWR/LSVFRPE8QLYHUVLW\H[FHHGHGWKH
sectarian mission. VWDWXWRU\PLQLPXPORDQDPRXQW7KHUHIRUHWKHERQGVPD\EH
FKDUDFWHUL]HG DV SULYDWH DFWLYLW\ ERQGV XQGHU 86&
In view of the government’s direct involvement with D )XUWKHUWKH/RDQ$JUHHPHQWEHWZHHQWKH
advancing the religious mission of a pervasively sectarian %RDUGDQG/LSVFRPE8QLYHUVLW\VSHFLILFDOO\SURKLELWVLWIURP
educational institution, it cannot be said that this form of state XVLQJ DQ\ ERQGILQDQFHG IDFLOLWLHV IRU UHOLJLRXV SXUSRVHV
aid comes within Walz v. Tax Comm’n, 397 U.S. 664 (1970), 7KHERQGVLQTXHVWLRQPHHWWKHWHFKQLFDOUHTXLUHPHQWVRI
where the Supreme Court upheld a property tax exemption to 86&
religious organizations for properties used solely for religious
worship. See Hunt, 413 U.S. at 745 n. 7. As noted in the )RUWKHERQGVWREHTXDOLILHGDVWD[H[HPSWWKH\PXVWDOVR
concurring opinion of Justice Brennan in Walz, while general PHHWWKHFULWHULDXQGHUVHFWLRQ H 7KHERQGVPHHWWKH
subsidies of religious activities would constitute ILUVWFULWHULDIRUEHLQJDTXDOLILHGSULYDWHDFWLYLW\ERQGXQGHU
impermissible state involvement with religion, tax VHFWLRQ H EHFDXVHWKHERQGVDUHTXDOLILHG F
exemptions "constitute mere passive state involvement with ERQGV ZKLFK LV RQH RI WKH HQXPHUDWHG FDWHJRULHV RI ERQG
religion and not the affirmative involvement characteristic of W\SHVXQGHUWKLVVHFWLRQ6HH86& H
outright government subsidy." Walz, 397 U.S. at 690-91. As $TXDOLILHG F ERQGLVGHILQHGLQVHFWLRQ D DVD
explained by Justice Brennan: SULYDWH DFWLYLW\ ERQG ZKHUH DOO SURSHUW\ ZKLFK LV WR EH
SURYLGHGE\WKHQHWSURFHHGVRIWKHLVVXHLVWREHRZQHGE\D
Tax exemptions and general subsidies, however, are F RUJDQL]DWLRQ86& D $OO
qualitatively different. Though both provide economic RIWKHSURFHHGVRIWKHERQGLVVXHZHUHORDQHGWR
assistance, they do so in fundamentally different ways. /LSVFRPE8QLYHUVLW\IRUXVHLQEXLOGLQJQHZIDFLOLWLHVDQGLQ
A subsidy involves the direct transfer of public monies to UHQRYDWLQJ H[LVWLQJ IDFLOLWLHV /LSVFRPE 8QLYHUVLW\ LV D
the subsidized enterprise and uses resources exacted from UHJLVWHUHG F RUJDQL]DWLRQ WKHUHE\ VDWLVI\LQJ WKLV
the taxpayers as a whole. An exemption, on the other UHTXLUHPHQW
hand, involves no such transfer. It assists the exempted
enterprise only passively, by relieving a privately funded
venture of the burden of paying taxes.
7KH /RDQ $JUHHPHQW EHWZHHQ /LSVFRPE 8QLYHUVLW\ DQG WKH %RDUG
Id. (footnotes omitted.) Thus, in finding that the property GRHV FRQWDLQ D UHVWULFWLYH XVH SURYLVLRQ 6HFWLRQ RQ 6SHFLDO
exemptions in question did not rise to the level of excessive &RYHQDQWV VWDWHV
governmental involvement, Justice Brennan noted: V 7KH %RUURZHU ZLOO QRW XVH WKH 3URMHFW RU DQ\ SDUW WKHUHRI IRU
VHFWDULDQ LQVWUXFWLRQ RU DV D SODFH RI UHOLJLRXV ZRUVKLS RU LQ
To the extent that the exemptions further secular ends, FRQQHFWLRQ ZLWK DQ\ SDUW RI WKH SURJUDP RI D VFKRRO RU
they do not advance "essentially religious purposes." To GHSDUWPHQW RI GLYLQLW\ IRU DQ\ UHOLJLRXV GHQRPLQDWLRQ RU WKH
the extent that purely religious activities are benefited by WUDLQLQJ RI PLQLVWHUV SULHVWV UDEELV RU RWKHU VLPLODU SHUVRQV LQ
the exemptions, the benefit is passive. Government does WKH ILHOG RI UHOLJLRQ
not affirmatively foster these activities by exempting 6WHHOH ) 6XSSG DW FLWLQJ 'RFNHW 1R DWWDFK ([ DW
6WHHOHHWDOY,QGXVWULDO 1RV 1RV 6WHHOHHWDOY,QGXVWULDO
'HY%GHWDO 'HY%GHWDO
7KHGLVWULFWFRXUWVXPPDUL]HGWKHILQDOUHTXLUHPHQWDVWR fundamental character of the government’s participation in
SXELFKHDULQJDQGORFDODSSURYDODVIROORZV this kind of financing arrangement. In this respect, it is
important to examine the reasoning of the Virginia Supreme
>$@ SULYDWH DFWLYLW\ ERQG ZLOO QRW EH D TXDOLILHG ERQG Court in Lynn, which found that the governmental aid
XQOHVV LW PHHWV WKH VXEVHFWLRQ
V SXEOLF DSSURYDO involved in the revenue-bond financing in that case did not
UHTXLUHPHQW 86& I 7KLV amount to "direct aid" to Regent University, a pervasively
UHTXLUHPHQWLVVDWLVILHGZKHUHWKHERQGLVVXHKDVEHHQ sectarian educational institution, because no governmental aid
ERWK DSSURYHG HLWKHU E\ RU RQ EHKDOI RI WKH was received by the University since the bond proceeds are
JRYHUQPHQWDO XQLW WKDW LVVXHG WKH ERQGV DQG funds of private investors. 538 S.E.2d at 638. According to
DSSURYHG E\ HDFK JRYHUQPHQWDO XQLW WKDW KDV Lynn, "Regent receives these funds because of the genuinely
MXULVGLFWLRQRYHUWKHDUHDZKHUHDQ\IDFLOLWLHVZKLFKDUH independent choices of investors," whose decisions to
WR EH ILQDQFHG E\ WKH ERQG SURFHHGV DUH ORFDWHG purchase the bonds "cannot be attributed to state decision
86& I $ ,QHDFKFDVHWKHDSSURYDO making." Id. at 639 (citing Zobrest v. Catalina Foothills Sch.
PXVW EH JLYHQ E\ HLWKHU WKH DSSOLFDEOH HOHFWHG Dist., 509 U.S. 1, 10 (1993)). Accordingly, the Virginia
UHSUHVHQWDWLYHRIVXFKJRYHUQPHQWDOXQLWDIWHUDSXEOLF Supreme Court concluded that there was no Establishment
KHDULQJ IROORZLQJ UHDVRQDEOH QRWLFH RU E\ D YRWHU Clause violation because "[n]o government funds ever reach
UHIHUHQGXP RI WKH JRYHUQPHQWDO XQLW 86& Regent’s coffers." Id.
I % 7KHHOHFWHGUHSUHVHQWDWLYHPD\EHDQ
HOHFWHGOHJLVODWLYHERG\RIWKHJRYHUQPHQWDOXQLWWKH What is being ignored in this account is the fact that the
FKLHI HOHFWHG H[HFXWLYH RIILFHU WKH FKLHI HOHFWHG 6WDWH government provides the pervasively sectarian educational
OHJDORIILFHURIWKHH[HFXWLYHEUDQFKRUDQ\RWKHUHOHFWHG institution with a direct economic benefit in the form of a
RIILFLDORIVXFKXQLWGHVLJQDWHGIRUWKHSXUSRVHVRIWKLV low-interest loan, which the institution would not be able to
SDUDJUDSKE\VXFKFKLHIHOHFWHGH[HFXWLYHRIILFHURUE\ obtain without the direct participation of the government.
6WDWHODZ86& I ( L 6WHHOH Thus, although it is true that no state funds are being
)6XSSGDW transferred through this kind of financing mechanism, the
relevant question is whether the government has provided the
pervasively sectarian educational institution with a direct
economic benefit. Contrary to the understanding of the court
7KH VFRSH RI WKH JRYHUQPHQWDO DSSURYDO LV DGGUHVVHG LQ IHGHUDO
UHJXODWLRQV ZKLFK VWDWH in Lynn, a direct economic benefit is not necessarily
determined by merely looking at whether there was a
$Q LVVXH LV WUHDWHG DV DSSURYHG LI WKH JRYHUQPHQWDO XQLWV KDYH transference of governmental money. To constitute a direct
DSSURYHG HLWKHU L 7KH LVVXH QRW PRUH WKDQ RQH \HDU EHIRUH
WKH GDWH RI LVVXH RU LL $ SODQ RI ILQDQFLQJ IRU HDFK IDFLOLW\
economic benefit to a pervasively sectarian educational
ILQDQFHG E\ WKH LVVXH SXUVXDQW WR ZKLFK WKH LVVXH LQ TXHVWLRQ LV institution, it is sufficient that the government makes it
WLPHO\ LVVXHG DV UHTXLUHG LQ SDUDJUDSK I RI WKLV VHFWLRQ ,Q possible for the institution to obtain economic aid that it
HLWKHU FDVH WKH VFRSH RI WKH DSSURYDO LV GHWHUPLQHG E\ WKH would not otherwise be able to obtain without the
LQIRUPDWLRQ DV VSHFLILHG LQ SDUDJUDSK I FRQWDLQHG LQ WKH
government’s direct participation. That no governmental
QRWLFH RI KHDULQJ DQG WKH DSSURYDO ,QIRUPDWLRQ UHTXLUHG
$ IDFLOLW\ LV ZLWKLQ WKH VFRSH RI DQ DSSURYDO LI WKH QRWLFH RI
funds actually reach the coffers of the pervasively sectarian
KHDULQJ DQG WKH DSSURYDO FRQWDLQ L $ JHQHUDO IXQFWLRQDO educational institution does not alter for one moment the fact
GHVFULSWLRQ RI WKH W\SH DQG XVH RI WKH IDFLOLW\ WR EH ILQDQFHG
6WHHOHHWDOY,QGXVWULDO 1RV 1RV 6WHHOHHWDOY,QGXVWULDO
'HY%GHWDO 'HY%GHWDO
lots, landscaping, computer mainframe, baseball stadium, ,QWKLVFDVHWKHERQGLVVXHZDVDSSURYHGE\WKH,QGXVWULDO
tennis courts, fiber optic network, a pedestrian walkway, and 'HYHORSPHQW%RDUGDVWKHJRYHUQPHQWDOXQLWWKDWLVVXHGWKH
renovate its administration and business school buildings. ERQGVDQGE\0D\RU%LOO%RQHUDVWKHFKLHIHOHFWHGH[HFXWLYH
Through the low-interest loan, Lipscomb was thereby able to RIILFHU RI 0HWURSROLWDQ *RYHUQPHQW RI 1DVKYLOOH DQG
improve its facilities to increase its student enrollment to 'DYLGVRQ &RXQW\ WKH JRYHUQPHQWDO XQLW LQ ZKLFK WKH
3,000, and thus advance its sectarian mission. IDFLOLWLHVRI/LSVFRPE8QLYHUVLW\DUHORFDWHG
The district court also properly rejected Defendants’ ,,67$1'$5'2)5(9,(:
argument that Lipscomb’s economic benefit came from the
bond purchasers who purchased the tax-exempt revenue 7KLV&RXUWUHYLHZVWKHGLVWULFWFRXUW¶VJUDQWRIVXPPDU\
bonds, and not from the government. Properly understood, MXGJPHQWGHQRYR6HH*ULEFKHFNY5XQ\RQ)G
Lipscomb received a direct economic benefit in the form of a WK&LU 7KHVWDQGDUGVDSSOLFDEOHWRVXFKUHYLHZ
low-interest government sponsored loan. For Establishment DUHZHOOHVWDEOLVKHG
Clause purposes, it is immaterial that the Board subsequently
assigned the loan to Sovran Bank. 6XPPDU\ MXGJPHQW LV DSSURSULDWH ZKHUH QR JHQXLQH
LVVXHRIPDWHULDOIDFWH[LVWVVRWKDWWKHPRYDQWLVHQWLWOHG
The district court also correctly rejected Defendants’ WRMXGJPHQWDVDPDWWHURIODZ)HG5&LY3 F 7KH
argument that the bondholders, not Lipscomb, are the true FRXUWGHWHUPLQHVZKHWKHU³WKHUHDUHDQ\JHQXLQHIDFWXDO
beneficiaries of the aid program. As the district court LVVXHVWKDWSURSHUO\FDQEHUHVROYHGRQO\E\DILQGHURI
properly noted, the Supreme Court in Hunt examined a IDFWEHFDXVHWKH\PD\UHDVRQDEO\EHUHVROYHGLQIDYRURI
similar transaction and found that "[t]he income tax-exempt HLWKHUSDUW\´$QGHUVRQY/LEHUW\/REE\,QF86
status of the interest enables the Authority, as an 6&W /(GG 2I
instrumentality of the State, to market the bonds at a FRXUVH³LQIHUHQFHVWREHGUDZQIURPWKHXQGHUO\LQJIDFWV
significantly lower rate of interest than the educational PXVWEHYLHZHGLQWKHOLJKWPRVWIDYRUDEOHWRWKHSDUW\
institution would be forced to pay if it borrowed the money RSSRVLQJWKHPRWLRQV´0DWVXVKLWD(OHF,QGXV&RY
by conventional private financing." Steele, 117 F.Supp.2d at =HQLWK 5DGLR &RUS 86 6&W
717 (quoting Hunt, 413 U.S. at 739). Thus, the district court /(GG 7KH PRYDQW PHHWV LWV
rightly concluded that "Lipscomb received a flow of funds
into its coffers provided by a loan from the Board. These
funds did not merely supplement the teaching of secular LL 7KH PD[LPXP DJJUHJDWH IDFH DPRXQW RI REOLJDWLRQV WR EH
subjects at Lipscomb; they were central to the school’s stated LVVXHG ZLWK UHVSHFW WR WKH IDFLOLW\ LLL 7KH LQLWLDO RZQHU
RSHUDWRU RU PDQDJHU RI WKH IDFLOLW\ LY 7KH SURVSHFWLYH
goal of increasing enrollment. If Lipscomb’s mission is to
ORFDWLRQ RI WKH IDFLOLW\ E\ LWV VWUHHW DGGUHVV RU LI QRQH E\ D
promote Churches of Christ doctrine, then Metro, through the JHQHUDO GHVFULSWLRQ GHVLJQHG WR LQIRUP UHDGHUV RI LWV VSHFLILF
Board, provided aid to promote Churches of Christ doctrine." ORFDWLRQ $Q DSSURYDO RU QRWLFH RI SXEOLF KHDULQJ ZLOO QRW EH
Steele, 117 F. Supp.2d at 718. FRQVLGHUHG WR EH DGHTXDWH LI DQ\ RI WKH LWHPV LQ VXEGLYLVLRQV L
WKURXJK LY RI WKLV VXESDUDJUDSK ZLWK UHVSHFW WR WKH IDFLOLW\
It should be pointed out, at this juncture, that characterizing WR EH ILQDQFHG DUH XQNQRZQ RQ WKH GDWH RI WKH DSSURYDO RU WKH
GDWH RI WKH SXEOLF QRWLFH
the role of the state as a "mere conduit" on the basis that the
use of governmental funds is not involved ignores the &)5 I I
6WHHOHHWDOY,QGXVWULDO 1RV 1RV 6WHHOHHWDOY,QGXVWULDO
'HY%GHWDO 'HY%GHWDO
LQLWLDOEXUGHQ³E\µVKRZLQJ¶±WKDWLVSRLQWLQJRXWWRWKH receipts from any such facilities and secured by a pledge
GLVWULFWFRXUW±WKDWWKHUHLVDQDEVHQFHRIHYLGHQFH WR of said revenues and receipts.
VXSSRUWWKHQRQPRYLQJSDUW\¶VFDVH´&HORWH[&RUSY
&DWUHWW 86 6&W (J.A. at 130-31.) Thus, contrary to the protestations of the
/(GG $W WKDW SRLQW WKH QRQPRYDQW Board and Metro, it is clear that because the Board is an
³PXVW VHW IRUWK VSHFLILF IDFWV VKRZLQJ WKDW WKHUH LV D instrumentality of Metro, both Defendants were involved in
JHQXLQHLVVXHIRUWULDO´)HG5&LY3 H $QGHUVRQ the project benefiting Lipscomb, notwithstanding their
86DW6&W separate legal identity. Further, the district court properly
rejected Metro’s contention that it could not be liable for an
&OD\WRQY0HLMHU,QF)G WK &LU Establishment Clause violation in this case because it only
FLWDWLRQRPLWWHG provided "host approval" for the bonds to be federally tax
exempt. As the district court properly noted, Metro’s role in
,,,$1$/<6,6 the financing was critical because the bonds could not have
been issued as federally tax exempt without Metro’s
7KHLVVXHSUHVHQWHGLQWKLVDSSHDOLVZKHWKHUWKHLVVXDQFH participation in approving the bond issue.
RI WD[ H[HPSW UHYHQXH ERQGV YLRODWHV WKH (VWDEOLVKPHQW
&ODXVHLIWKHERQGVDUHIRUWKHEHQHILWRIDQLQVWLWXWLRQIRXQG Under the terms of the statute, local governments are
E\WKHGLVWULFWFRXUWWREHSHUYDVLYHO\VHFWDULDQ7KHLVVXH authorized to offer low-interest loans by making funds
available through the issuance of tax-exempt municipal
bonds. Here, Lipscomb approached the Board seeking a low-
,Q WKH IROORZLQJ FDVHV WKH 6XSUHPH &RXUW IRXQG JRYHUQPHQW DLG interest development loan funded by the proceeds of the tax-
SURJUDPV FRQVWLWXWLRQDO 0LWFKHOO Y +HOPV 86
exempt bond issuance. While the money that went to
SOXUDOLW\ SURYLGLQJ HGXFDWLRQDO PDWHULDOV DQG HTXLSPHQW WR UHOLJLRXV
VFKRROV XSKHOG $JRVWLQL Y )HOWRQ 86 DOORZLQJ
Lipscomb ultimately came from private investors who
UHPHGLDO SXEOLF VFKRRO WHDFKHUV DQG FRXQVHORUV WR DVVLVW DW UHOLJLRXV purchased the tax-exempt revenue bonds, and while
VFKRRO 5RVHQEHUJHU Y 5HFWRU DQG 9LVLWRUV RI 8QLY RI 9LUJLQLD Lipscomb must repay Sovran Bank for the loan, the direct
86 SURYLGLQJ SULQWLQJ IDFLOLWLHV IRU DOO TXDOLILHG VWXGHQW economic benefit that Lipscomb received from the
SXEOLFDWLRQV LQFOXGLQJ UHOLJLRXV SXEOLFDWLRQ FRQVWLWXWLRQDO =REUHVW Y
governmental entities, as the district court pointed out, was
&DWDOLQD )RRWKLOOV 6FK 'LVW 86 SURYLGLQJ D VLJQ
ODQJXDJH LQWHUSUHWHU IRU GHDI FKLOG LQ UHOLJLRXV VHFRQGDU\ VFKRRO QRW
the low-interest "loan from the Board and, hence, from
XQFRQVWLWXWLRQDO %RZHQ Y .HQGULFN 86 IXQGLQJ IRU Metro." Steele, 117 F. Supp.2d at 717.
DEVWLQHQFHEDVHG IDPLO\ SODQQLQJ SURJUDPV RIIHUHG E\ UHOLJLRXV VRFLDO
ZHOIDUH DJHQF\ IRXQG FRQVWLWXWLRQDO :LWWHUV Y :DVKLQJWRQ 'HSW RI Thus, even though there was no direct transfer of money
6HUYLFHV IRU WKH %OLQG 86 RIIHULQJ YRFDWLRQDO HGXFDWLRQ
from the Board to Lipscomb, the district court correctly found
VFKRODUVKLS WR YLVXDOO\ GLVDEOHG VHPLQDULDQ QRW XQFRQVWLWXWLRQDO
&RPPLWWHH IRU 3XE (GXF DQG 5HOLJLRXV /LEHUW\ Y 5HJDQ 86
that "[t]he money went directly to Lipscomb in the form of a
UHLPEXUVLQJ UHOLJLRXV VFKRRO IRU SHUIRUPLQJ VWDWHPDQGDWHG loan from the Board, an instrumentality of Metro." Id., 117
VWDQGDUGL]HG WHVWV DQG UHFRUG NHHSLQJ :ROPDQ Y :DOWHU 86 F. Supp.2d at 720. As a result of the low-interest loan of $15
SURYLGLQJ WH[WERRN ORDQV YRFDWLRQDO WUDLQLQJ GLDJQRVWLF VHUYLFHV million originated by the Board at Lipscomb’s request,
WKHUDSHXWLF DQG UHPHGLDO VHUYLFHV DQG VWDQGDUGL]HG WHVWLQJ DQG VFRULQJ IRU Lipscomb thus saved about 30% of the cost of its campus
UHOLJLRXV VFKRRO 5RHPHU Y %G RI 3XE :RUNV 86
VXEVLGL]LQJ SHUVWXGHQW WR D UHOLJLRXV FROOHJH FRQVWLWXWLRQDO 7LOWRQ Y
building projects. These savings enabled Lipscomb to fund
5LFKDUGVRQ 86 ILQGLQJ FRQVWUXFWLRQ JUDQWV WR the new library, intramural sports building and field, parking
6WHHOHHWDOY,QGXVWULDO 1RV 1RV 6WHHOHHWDOY,QGXVWULDO
'HY%GHWDO 'HY%GHWDO
providing every religion with an equal opportunity (say, to KDVQRWEHHQDGGUHVVHGE\RWKHU&LUFXLWVRUE\WKH6XSUHPH
secure state funding or to pray in public schools), but by &RXUW
drawing fairly clear lines of separation between church and
state") (emphasis in original). :KDWPDWWHUVLQWKLVFDVHWKHQ 7KH)LUVW$PHQGPHQWDSSOLFDEOHWRWKHVWDWHVWKURXJKWKH
LV RQO\ ZKHWKHU WKH VWDWH DLG SURYLGHG WR /LSVFRPE D )RXUWHHQWK$PHQGPHQWSURYLGHVWKDW&RQJUHVVVKDOOPDNH
SHUYDVLYHO\ VHFWDULDQ LQVWLWXWLRQ LV LQ YLRODWLRQ RI WKH
(VWDEOLVKPHQW&ODXVH
The district court properly concluded that the Establishment UHOLJLRXVO\ DIILOLDWHG FROOHJH FRQVWLWXWLRQDO %G RI (GXF Y $OOHQ
Clause was violated because Lipscomb received a direct 86 ORDQLQJ RI WH[WERRNV IRU UHOLJLRXV VFKRRO XSKHOG
(YHUVRQ Y %G RI (GXF 86 UHLPEXUVLQJ SDUHQWV IRU EXV
economic benefit from the government, which resulted in WUDQVSRUWDWLRQ FRVWV WR UHOLJLRXV VFKRRO FRQVWLWXWLRQDO &RFKUDQ Y
excessive entanglement of the government with the religious /RXLVLDQD 6WDWH %G RI (GXF 86 ORDQLQJ WH[WERRNV WR
institution. Although the district court noted that "[t]here is UHOLJLRXV VFKRRO FRQVWLWXWLRQDO %UDGILHOG Y 5REHUWV 86
no single, clear definition of ‘direct benefit’ to control this DOORZLQJ IHGHUDO IXQGV WR EXLOG D &DWKROLF KRVSLWDO FRQVWLWXWLRQDO
analysis," Black’s Law Dictionary defines "direct" in the
relevant sense as "[i]mmediate; proximate; by the shortest 6HYHUDO VWDWH FRXUWV KDYH DGGUHVVHG WKH SUHFLVH LVVXH DOO KDYH IRXQG
course; without circularity; operating by an immediate WKDW WKH LVVXDQFH RI LQGXVWULDO UHYHQXH ERQGV LV QRW WDQWDPRXQW WR WKH
JLYLQJ RI GLUHFW DLG WR UHOLJLRXV VFKRROV 2SLQLRQ RI WKH -XVWLFHV
connection or relation, instead of operating through a 0DVV 1(G FRQFOXGLQJ WKDW WD[H[HPSW
medium; the opposite of indirect." Black’s Law Dictionary ERQG ILQDQFLQJ LV QRW D IRUP RI GLUHFW DVVLVWDQFH WR SULYDWH RU UHOLJLRXV
459 (6th ed. 1990). In contrast, "indirect" is defined as "[n]ot FKDULWDEOH LQVWLWXWLRQV DV WKHUH ZDV QR JUDQW RU DSSURSULDWLRQ RI SXEOLF
direct in relation or connection; not having an immediate PRQH\ QR ORDQ RI SXEOLF FUHGLW DQG WKH SDUWLFLSDQWV ERUH DOO FRVWV RI WKH
bearing or application; not related in the natural way." Id. at SURJUDP 9HUPRQW (GXF %OGJV )LQDQFLQJ $JHQF\ Y 0DQQ $G
9W DSS GLVP¶G 86 VDPH 1RKUU Y
773. %UHYDUG &RXQW\ (GXF )DFLOLWLHV $XWK 6RG )OD
VDPH &HUFOH Y ,OO (GXF )DFLOLWLHV $XWK 1(G ,OO
As the district court correctly noted, the Board and Metro VDPH &DOLI (GXF )DFLOLWLHV $XWK Y 3ULHVW 3G
were both directly connected to the project benefiting &DO VDPH 0LQQ +LJKHU (GXF )DFLOLWLHV $XWK Y +DZN
Lipscomb. According to the official statement regarding the 1:G 0LQQ :DVKLQJWRQ +LJKHU (GXF )DFLOLWLHV $XWK
Y *DUGQHU 3G :DVK KROGLQJ WKDW WKH
issuance of $15 million in educational facilities refunding WD[ H[HPSW VWDWXV GLG QRW FUHDWH D GHEW RU D ERUURZHUOHQGHU UHODWLRQVKLS
bonds, EHWZHHQ WKH VWDWH DQG WKH UHOLJLRXVO\ DIILOLDWHG XQLYHUVLWLHV RU WKH
ERQGKROGHUV WKH ERQG SURFHHGV QHYHU HQWHUHG WKH SXEOLF WUHDVXU\
The Issuer [the Board] was created on May 6, 1959 UHSD\PHQW GLG QRW SDVV WKURXJK WKH SXEOLF WUHDVXU\ DQG QR VWDWH GHEW ZDV
pursuant to the Act as a public corporation and FUHDWHG &RUWH] Y ,QGHSHQGHQFH &RXQW\ 6:G $UN
FRQFOXGLQJ WKDW WKH WD[H[HPSW UHYHQXH ERQGV ZHUH QRW D SOHGJH
instrumentality of the Metropolitan Government of
RI SXEOLF PRQH\ 9LUJLQLD &ROOHJH %OGJ $XWK Y /\QQ 6(G
Nashville and Davidson County, Tennessee, for the 9D ILQGLQJ WKDW WKH DLG UHFHLYHG IURP WD[H[HPSW UHYHQXH
purpose, among other things, of financing educational ERQGV GRHV QRW LQYROYH XVDJH RI JRYHUQPHQWDO IXQGV LQ WKH WUDGLWLRQDO
facilities with a view to promoting the education of the VHQVH LQ ZKLFK WKH WHUPV KDYH EHHQ XVHG 6HH DOVR 'XUKDP Y 0F/HRG
people of the State of Tennessee. The Issuer is 6(G 6& DSS GLVP¶G IRU ZDQW RI D VXE¶O IHG¶O
TXHVWLRQ 86 ILQGLQJ WKDW WD[IUHH UHYHQXH ERQGV
authorized by the Act to issue revenue bonds, including VDWLVILHG VROHO\ E\ VWXGHQW ORDQ SD\PHQW ZHUH QHLWKHU D VWDWH GHEW QRU
refunding bonds, payable solely from the revenues and SXEOLF PRQH\ RU FUHGLW
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&DO RQHRIWKHFDVHVFLWHGE\WKHPDMRULW\ VFKRROVSDUWLFLSDWLQJZHUHSHUYDVLYHO\VHFWDULDQ´,QKLV
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VHFWDULDQVFKRROZDVDSULPDU\RUVHFRQGDU\VFKRRO%XW The issuance of tax-exempt revenue bonds in this case
WKDWSHULRGLVRQHWKDWWKH&RXUWVKRXOGUHJUHWDQGLWLV constitutes direct aid within the meaning of the
WKDQNIXOO\ORQJSDVW´ Establishment Clause
,G DW -XVWLFH 7KRPDV ZHQW RQ WR QRWH WKDW WKH Given that Lipscomb is a pervasively sectarian educational
SHUYDVLYHO\ VHFWDULDQ DQDO\VLV ³ERUQ RI ELJRWU\ VKRXOG EH institution, it thus must be determined whether the issuance of
EXULHGQRZ´,GDW the tax-exempt revenue bonds is a direct or indirect benefit
for Establishment Clause purposes. In this regard, it should
,@WLVIDUIURPVHWWOHGWKDWWKHW\SHRIDLGDWLVVXHLQWKLV University," and must submit a "[p]ersonal goals
FDVHLVGLUHFWDLGZLWKLQWKHPHDQLQJRIWKH(VWDEOLVKPHQW statement" addressing how their "personal and spiritual
&ODXVHMXULVGLFWLRQ objectives" relate to Regent’s "Christ-centered
educational philosophy." The instructions explain that
,GDW "for the Christian, [a goal] is a statement of faith in God's
will for his or her life."
0RUHRYHU WKH &RXUW DOVR PDGH WKH IROORZLQJ
REVHUYDWLRQ Faculty, unlike students, are required to sign a
document indicating their adherence to the "Statement of
3ODLQWLIIFODLPVWKDWWKHWD[H[HPSWLRQXQGHUWKH('& Faith." They are "strongly encouraged but they're not
$FWLVWKHHTXLYDOHQWRIDWD[VXEVLG\IRUSXUSRVHVRIWKH required" to attend chapel. The faculty is required to
(VWDEOLVKPHQW &ODXVH 7KH 6XSUHPH &RXUW KDV integrate "faith and learning." Dr. Selig testified, and the
H[SUHVVO\ UHMHFWHG WKH DUJXPHQW ³7KHUH LV D SACS (Southern Association of Colleges and Schools)
FRQVWLWXWLRQDOO\VLJQLILFDQWGLIIHUHQFHEHWZHHQVXEVLGLHV and the ABA (American Bar Association) agree, that the
DQGWD[H[HPSWLRQV´&DPSV1HZIRXQG2ZDWRQQD,QF Statement of Faith has not interfered with academic
Y7RZQRI+DUULVRQ86 Q FLWLQJ freedom. Regent’s detailed academic freedom policy
6WHHOHHWDOY,QGXVWULDO 1RV 1RV 6WHHOHHWDOY,QGXVWULDO
'HY%GHWDO 'HY%GHWDO
institution for Establishment Clause purposes. As noted by :DO] 86 >@ > @ 7KH GLIIHUHQFH
the Virginia Supreme Court in Lynn, EHWZHHQVXEVLGLHVDQGWD[H[HPSWLRQVLVWKDWLQJLYLQJ
WD[H[HPSWLRQV³WKHJRYHUQPHQWGRHVQRWWUDQVIHUSDUWRI
Regent’s Articles of Incorporation, provide that: LWVUHYHQXHEXWVLPSO\DEVWDLQVIURPGHPDQGLQJWKH
>HQWLW\@ VXSSRUW WKH VWDWH´ :DO] 86 DW
[Regent] shall exist for the purpose of bringing glory 7KHUHIRUHWKHEHQHILWSURYLGHGE\WKHWD[H[HPSWVWDWXV
to God and His Son Jesus Christ by providing an RIWKHERQGVGRHVQRWDPRXQWWRDFDVKVXEVLG\
institution or institutions of learning in which those who
are mature in the knowledge of God and His ways can ,GDW SDUDOOHOFLWDWLRQVRPLWWHG
assist and guide, in a spirit of free inquiry and scholarly
excellence, those who would learn of Him, His ways, and -XGJH 1HOVRQ LQ D FRQFXUULQJ RSLQLRQ ZDV HYHQ PRUH
His creation, while together they study ways to glorify GLUHFWDQGFRQFOXGHGWKDWFRQGXLWILQDQFLQJLQWKHIRUPRIDQ
God and better their world. LQGXVWULDO UHYHQXH ERQG GRHV QRW RIIHQG WKH (VWDEOLVKPHQW
&ODXVH HYHQ LI WKH EHQHILWWLQJ LQVWLWXWLRQ LV SHUYDVLYHO\
538 S.E.2d at 685. Lynn also noted that Regent has adopted VHFWDULDQ,GDW +HFRQFOXGHGWKDWWKHW\SHRIDLGLQ
a Statement of Faith that provides, TXHVWLRQZDVQRGLIIHUHQWWKDQWKHLQGLUHFWDLGSURYLGHGE\
SURSHUW\WD[H[HPSWLRQVDYDLODEOHWRUHOLJLRXVLQVWLWXWLRQVDQG
Regent University is a Christ-centered institution. The H[SUHVVO\DSSURYHGE\WKH6XSUHPH&RXUWLQ:DO]LQIUD,G
Board of Trustees, along with the faculty and staff of the DW
university, are committed to an evangelical interpretation
and application of the Christian faith. The campus ,Q WKH FDVH DW EDU WKH %RDUG SURYLGHV SDVVWKURXJK RU
community is closely identified with the present-day FRQGXLWILQDQFLQJVHUYLFHVWRDZLGHYDULHW\RIQRQUHOLJLRXV
renewal movement, which emphasizes the gifts, fruit and DQG UHOLJLRXV QRQSURILW RUJDQL]DWLRQV 7KH %RDUG KDV
ministries of the Holy Spirit. It is expected that all DUUDQJHGWD[H[HPSWILQDQFLQJIRUH[DPSOHIRUDQXPEHURI
trustees, officers, administrators and faculty will FROOHJHV DQG XQLYHUVLWLHV ZLWK DQG ZLWKRXW D UHOLJLRXV
subscribe to this statement in writing[.] DIILOLDWLRQDVZHOODVIRUORZLQFRPHKRXVLQJSURMHFWVWKH
&RXQWU\ 0XVLF +DOO RI )DPH WKH (DVWHU 6HDO 6RFLHW\
Id. Regent’s Mission Statement provides: UHWLUHPHQWFHQWHUVWKH-HZLVK&RPPXQLW\&HQWHUWKHW@KHUHLVQR court examined the college’s mission statement and the
JHQXLQHQH[XVEHWZHHQWD[H[HPSWLRQDQGHVWDEOLVKPHQWRI descriptions of secular curricula in the college’s catalog,
UHOLJLRQ´,G among other things, in making this finding. The court
looked at the college’s syllabi for secular courses and
6XEVHTXHQWO\ WKH &RXUW PDGH FOHDU WKDW DQ LQGLUHFW determined that the religious references were too isolated
ILQDQFLDOEHQHILWFRQIHUUHGE\DUHOLJLRXVO\QHXWUDOWD[GRHV and scattered to justify a finding that religion permeates
QRWJLYHULVHWRDQ(VWDEOLVKPHQW&ODXVHYLRODWLRQ,Q0XHOOHU the secular courses. And although the court found that
Y $OOHQ 86 WKH &RXUW XSKHOG D WD[ the Seventh-day Adventist Church exerted a dominance
GHGXFWLRQIRUDPRXQWVSDLGDVVFKRROWXLWLRQWH[WERRNVDQG over college affairs and that the college gave an express
WUDQVSRUWDWLRQ 7KH &RXUW DFNQRZOHGJHG WKDW ³UHOLJLRXV preference in hiring and admissions to members of the
Church, these factors by themselves were not enough to
make the college a pervasively sectarian one.
Id. at 508-09. In contrast to Columbia Union College,
7KH &RXUW IRXQG VLJQLILFDQW WKDW WKHVH GHGXFWLRQV ZHUH DPRQJ PDQ\
GHGXFWLRQV DOORZHG XQGHU 0LQQHVRWD ODZ )RU H[DPSOH WKH &RXUW IRXQG Lipscomb has a mandatory worship policy and imparts
WKDW
instruction with the primary objective of religious
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indoctrination. Lipscomb also places religious restrictions on
ODZ 0LQQ 6WDW VXEG LQFOXGH FRQWULEXWLRQV
admission and expressly hires faculty and staff based upon
WR UHOLJLRXV LQVWLWXWLRQV DQG H[HPSWLRQV IURP SURSHUW\ WD[ IRU membership in the Churches of Christ.
SURSHUW\ XVHG IRU FKDULWDEOH SXUSRVHV XQGHU 0LQQHVRWD ODZ
LQFOXGH SURSHUW\ XVHG IRU ZKROO\ UHOLJLRXV SXUSRVHV Indeed, Lipscomb is even more pervasively sectarian than
,Q HDFK FDVH LW PD\ EH WKDW UHOLJLRXV LQVWLWXWLRQV EHQHILW YHU\
Regent University ("Regent"), the only other institution that
:DO]
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V
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has been found by a court to be a pervasively sectarian
KRZHYHU WKDW WKLV GRHV QRW UHTXLUH WKH FRQFOXVLRQ WKDW VXFK
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Moreover, there are no religious requirements for LQVWLWXWLRQVEHQHILWYHU\VXEVWDQWLDOO\IURPWKHDOORZDQFH´RI
membership on the Academy's Board of Trustees. WKLVNLQGRIWD[GHGXFWLRQ,GDW Q7KH&RXUWIRXQG
Non-Catholics have served, and currently serve, on the WKDWERWKSDUHQWVDQGSDURFKLDOVFKRROVUHFHLYHGDEHQHILWDQG
Board. WKHDVVLVWDQFH³XOWLPDWHO\KDVDQHFRQRPLFHIIHFWFRPSDUDEOH
WR WKDW RI DLG JLYHQ GLUHFWO\ WR WKH VFKRROV DWWHQGHG E\ WKH
In addition, the Academy does not discriminate on the FKLOGUHQ´,GDW ,UUHVSHFWLYHRIWKLVEHQHILWWKH&RXUW
basis of race, color, creed, or national origin in its DFNQRZOHGJHGLWVGHFLVLRQV³FRQVLVWHQWO\KDYHUHFRJQL]HGWKDW
admissions process, nor does it give preference in WUDGLWLRQDOO\µ>OHJLVODWXUHV@KDYHHVSHFLDOO\EURDGODWLWXGHLQ
admission to Roman Catholics. Furthermore, the FUHDWLQJFODVVLILFDWLRQVDQGGLVWLQFWLRQVLQWD[VWDWXWHV¶5HJDQ
Academy does not discriminate on the basis of race, Y7D[DWLRQ:LWK5HSUHVHQWDWLRQRI:DVK86
color, or national origin in any of its educational policies, LQSDUWEHFDXVHWKHµIDPLOLDULW\ZLWKORFDOFRQGLWLRQV¶
scholarship and loan programs, athletic or extracurricular HQMR\HGE\OHJLVODWRUVHVSHFLDOO\HQDEOHVWKHPWRµDFKLHYHDQ
activities, or other-school administered programs. As of HTXLWDEOH GLVWULEXWLRQ RI WKH WD[ EXUGHQ¶´ 0DGGHQ Y
the date of the issuance of the bonds at issue, 135 of the .HQWXFN\ 86 ,G DW 7KXV D
366 (non-preschool) students at the Academy, or 37%, UHOLJLRXVVFKRRO¶VUHFHLSWRILQGLUHFWEHQHILWVWKURXJKDWD[
were not Catholic. And as of the date of the stipulation, GHGXFWLRQ ³GRHV QRW UHTXLUH WKH FRQFOXVLRQ WKDW VXFK
34% of the students were not Catholic. The facts SURYLVLRQV RI D VWDWH¶V WD[ ODZ YLRODWH WKH (VWDEOLVKPHQW
indicate that faiths represented in the Academy student &ODXVH´,GDW $VORQJDVWKHWD[EHQHILWLVQHXWUDOO\
body include non-Catholic Christian, Jewish, Islamic, DYDLODEOHWKH(VWDEOLVKPHQW&ODXVHLVQRWYLRODWHG
Shinto and others. Finally, the Academy does not
discriminate on the basis of race, color, creed or national 7KH RQO\ HYLGHQFH RI UHFRUG LV WKDW VLPLODU ERQGV KDYH
origin in the hiring of its employees. The Academy has EHHQLVVXHGWRERWKUHOLJLRXVDQGQRQUHOLJLRXVLQVWLWXWLRQVLQ
a teaching faculty of 60, of whom five are members of DQHXWUDOPDQQHU7KHILQDQFLQJLQTXHVWLRQKDVEHHQPDGH
religious orders. There is no religious-affiliation DYDLODEOH WR FROOHJHV DQG XQLYHUVLWLHV LQ 0HWUR DV ZHOO DV
requirement or preference for the Academy's teachers,
and the school does not inquire as to the religious
affiliation of prospective faculty members. SURYLVLRQV RI D 6WDWH
V WD[ ODZ YLRODWH WKH (VWDEOLVKPHQW &ODXVH
Johnson, 241 F.3d at 516-17. Most striking, Lipscomb, 0XHOOHU 86 DW DQG Q
unlike the academy in Johnson, interjects religion into
virtually all aspects of its institutional life. Further, unlike 7KH 0XHOOHU FRXUW IRXQG WKDW ³>0@RVW LPSRUWDQWO\ WKH GHGXFWLRQ LV
the school in Johnson, Lipscomb reserves the right under DYDLODEOH IRU HGXFDWLRQDO H[SHQVHV LQFXUUHG E\ DOO SDUHQWV LQFOXGLQJ WKRVH
ZKRVH FKLOGUHQ DWWHQG SXEOLF VFKRROV DQG WKRVH ZKRVH FKLOGUHQ DWWHQG
Title VII of the Civil Rights Act of 1964 to discriminate in QRQVHFWDULDQ SULYDWH VFKRROV RU VHFWDULDQ SULYDWH VFKRROV´ 7KH &RXUW
the hiring of faculty and staff on the basis of religion. DQDORJL]HG WR :LGPDU Y 9LQFHQW 86 ZKHUH LW
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Lipscomb is also distinguishable from Columbia Union EURDG FODVV RI QRQUHOLJLRXV DV ZHOO DV UHOLJLRXV VSHDNHUV¶ GRHV QRW µFRQIHU
College, the educational institution affiliated with the DQ\ LPSULPDWXU RI VWDWH DSSURYDO¶´ 7KH &RXUW FRQFOXGHG WKDW ³KHUH
Seventh Day Adventist Church that the Fourth Circuit did not µ>WKH@ SURYLVLRQ RI EHQHILWV
LPSRUWDQW LQGH[ RI VHFXODU HIIHFW¶´
WR VR EURDG
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regard as a pervasively sectarian educational institution. See :H DGGUHVV WKH QHXWUDOLW\ LVVXH LQIUD
6WHHOHHWDOY,QGXVWULDO 1RV 1RV 6WHHOHHWDOY,QGXVWULDO
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WKURXJKRXW 7HQQHVVHH DQG WKH 8QLWHG 6WDWHV DQG KDV EHHQ educational institutions that the Supreme Court has found not
SURYLGHG WR D QXPEHU RI FROOHJHV DQG XQLYHUVLWLHV ZLWK to be pervasively sectarian.
GLIIHUHQWNLQGVRIUHOLJLRXVDIILOLDWLRQVDQGWKRVHZLWKRXWDQ\
UHOLJLRXVDIILOLDWLRQ It should also be noted that Lipscomb is markedly different
from the religious academy in Johnson that this Court found
,Q0XHOOHUWKH6XSUHPH&RXUWGLVWLQJXLVKHGLWVKROGLQJLQ not to be pervasively sectarian. In Johnson, this Court
1\TXLVW Y &RPPLWWHH IRU 3XEOLF (GXFDWLRQ DQG 5HOLJLRXV described the religious academy in the following terms:
/LEHUW\86 ,Q1\TXLVWWKHVWDWHOHJLVODWLRQ
DW LVVXH LQFOXGHG D ZLGH UDQJH RI JRYHUQPHQW ILQDQFLDO As to the nature of the institution, as with any
DVVLVWDQFH LQ DLG RI SULYDWH SUHGRPLQDWHO\ SDURFKLDO religiously affiliated school, the Academy pledges its
HGXFDWLRQ6WDWHPRQH\ZDVGLUHFWHGIRUPDLQWHQDQFH DQG allegiance to its faith. Nevertheless, the facts establish
UHSDLURISULYDWHVFKRROV,QDGGLWLRQWKHOHJLVODWLRQSURYLGHG that the Academy is not a pervasively sectarian
IRUERWKGLUHFWWXLWLRQJUDQWVDQGWD[FUHGLWVSD\DEOHWRSDUHQWV institution. The Academy’s Restated Articles of
ZKRVH FKLOGUHQ DWWHQGHG SULYDWH VFKRROV ,Q 0XHOOHU WKH Incorporation provide that the school’s purpose is to
&RXUW QRWHG WKDW WKH RXWULJKW JUDQWV LQ 1\TXLVW ZHUH "conduct an independent Catholic school from pre-school
IXQGDPHQWDOO\ GLIIHUHQW IURP WD[ GHGXFWLRQV JLYHQ WR DOO through and including the 12th grade, wherein the arts
SDUHQWVRISXEOLFDQGSULYDWHVFKRROVWXGHQWVIRUHGXFDWLRQ and sciences, and other forms of primary and secondary
UHODWHGH[SHQVHV86DW Q)XUWKHUXQOLNHWKH learning are taught, and diplomas and honors therein
GHGXFWLRQVDSSURYHGLQ0XHOOHUWKHGHGXFWLRQVDWLVVXHLQ conferred: while maintaining a philosophy consonant
1\TXLVWZHUHQRWEDVHGRQDFWXDOH[SHQVHVLQFXUUHG,QVWHDG with that of the network of the Sacred Heart schools of
WKHGHGXFWLEOHDPRXQWVZHUHHVWLPDWHGDQGGHVLJQHGWRHTXDO which it is a member." (J.A. at 66.) The Academy’s
WKHGROODUDPRXQWRIWKHGLUHFWDLGLQWKHIRUPRIWXLWLRQJUDQWV curriculum and requirements provides that
DYDLODEOH RQO\ WR ORZ LQFRPH IDPLOLHV ,G 7KH &RXUW
FRQFOXGHGWKDWWKHVHJUDQWVGLGQRWWDNHWKHIRUPRIRUGLQDU\ [e]very student at [the Academy] receives intensive
WD[EHQHILWVDQGFRQVWLWXWHGGLUHFWDLGWRUHOLJLRXVVFKRROV training in the basic academic skills of English,
Mathematics, History, Foreign Language and
,Q+HUQDQGH]Y&RPPLVVLRQHURI,QWHUQDO5HYHQXH Science. Art, Music, Drama, Forensics, Theology
86 WKH &RXUW KHOG SURYLVLRQV RI WKH and Computer Science are essential parts of this
,QWHUQDO5HYHQXH&RGHSHUPLWWLQJIHGHUDOWD[SD\HUVWRGHGXFW program. [The Academy] offers each student a full
JLIWV RU FRQWULEXWLRQV PDGH WR D YDULHW\ RI FKDULWDEOH Physical Education Program designed to develop a
RUJDQL]DWLRQV LQFOXGLQJ SXUHO\ UHOLJLRXV JURXSV GLG QRW sense of sportsmanship, a respect for physical fitness
YLRODWHWKH(VWDEOLVKPHQW&ODXVH,Q+HUQDQGH]PHPEHUVRI and an awareness of the enjoyment derived from
WKH &KXUFK RI 6FLHQWRORJ\ FRQWHQGHG WKDW WKH )LUVW athletic endeavors.
$PHQGPHQW SUHYHQWHG WKH ,56 IURP GHHPLQJ REOLJDWRU\
SD\PHQWVIRUDWWHQGDQFHRI³DXGLWLQJVHVVLRQV´DVVRPHWKLQJ (J.A. at 154.) A review of the course descriptions and the
RWKHU WKDQ D FKDULWDEOH FRQWULEXWLRQ ,G DW 7KH ,56 subjects covered for each of the courses offered at the
FRQWHQGHG WKDW D PDQGDWRU\ SD\PHQW WR WKH FKXUFK IRU Academy, with the exception of the Religion
DXGLWLQJDQGWUDLQLQJZDVQRWDJLIWEXWUDWKHUDTXLGSURTXR Department, demonstrates that the Academy does not
SD\PHQWIRUVHUYLFHVUHFHLYHGDQGWKHUHIRUHQRWGHGXFWDEOH interject religion into every aspect of its curriculum.
6WHHOHHWDOY,QGXVWULDO 1RV 1RV 6WHHOHHWDOY,QGXVWULDO
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institution based upon the fact that it did not impose religious 7KH&KXUFKRI6FLHQWRORJ\FRQWHQGHGWKDWWKHGLVDOORZDQFH
qualifications on its faculty and staff and given that the RI VXFK SD\PHQWV DV FKDULWDEOH GHGXFWLRQV YLRODWHG WKH
percentage of the student body roughly reflected the same (VWDEOLVKPHQW &ODXVH LQWHU DOLD E\ FUHDWLQJ H[FHVVLYH
percentage of Baptists in the area. Unlike the college in Hunt, HQWDQJOHPHQWEHWZHHQFKXUFKDQGVWDWH7KH6XSUHPH&RXUW
which did not hire faculty on the basis of religion, apart from IRXQGQRH[FHVVLYHHQWDQJOHPHQWDQGLQODQJXDJHSHUWLQHQW
those teaching in the theology departments, Lipscomb WRWKHLVVXHEHIRUHWKLV&RXUWVWDWHGWKDW³URXWLQHUHJXODWRU\
requires that its faculty be members in good standing of the LQWHUDFWLRQZKLFKLQYROYHVQRLQTXLULHVLQWRUHOLJLRXVGRFWULQH
Churches of Christ. Further, the fact that the student body at QRGHOHJDWLRQRIVWDWHSRZHUWRDUHOLJLRXVERG\DQG
Lipscomb is largely affiliated with the Churches of Christ QR µGHWDLOHG PRQLWRULQJ DQG FORVH DGPLQLVWUDWLYH FRQWDFW¶
reflects Lipscomb’s placement of religious restrictions on EHWZHHQVHFXODUDQGUHOLJLRXVERGLHVGRHVQRWRILWVHOI
student admissions. YLRODWH WKH QRQHQWDQJOHPHQW FRPPDQG´ ,G DW
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Lipscomb is also clearly distinguishable from the Roman
Catholic colleges in Roemer, which were "characterized by a 0RVWUHFHQWO\LQ=HOPDQY6LPPRQV+DUULV86DW
high degree of institutional autonomy" from "their formal BBB WKH 6XSUHPH &RXUW DJDLQ GLVWLQJXLVKHG LWV
affiliation with the Roman Catholic Church." Roemer, 426 KROGLQJLQ1\TXLVW7KH=HOPDQ&RXUWIRXQGWKDWWKHVFKRRO
U.S. at 755. By contrast, Lipscomb’s "supreme purpose" is YRXFKHUSURJUDPLQ2KLRGLGQRWYLRODWHWKH(VWDEOLVKPHQW
"to teach the Bible as the revealed will of God to man and as &ODXVH7KH&RXUWIRXQGWKDWWKHSURJUDPZDVFRQWUROOHGE\
the only and sufficient rule of faith and practice, and to train LWVKROGLQJVLQ0XHOOHU:LWWHUVDQG=REUHVW$VWR1\TXLVW
those who will attend in a pure Bible Christianity." Further, WKH&RXUWKHOG
unlike the colleges in Roemer, Lipscomb does not subscribe
to the AAUP’s Statement of Principles on Academic 7RWKHH[WHQWWKHVFRSHRI1\TXLVWKDVUHPDLQHGDQRSHQ
Freedom. Moreover, unlike the colleges in Roemer, where TXHVWLRQLQOLJKWRIWKHVHODWHUGHFLVLRQVZHQRZKROG
attendance at religious exercises was not required and where WKDW 1\TXLVW GRHV QRW JRYHUQ QHXWUDO HGXFDWLRQDO
spiritual development was encouraged as a "secondary DVVLVWDQFHSURJUDPVWKDWOLNHWKHSURJUDPKHUHRIIHUDLG
objective," Lipscomb requires attendance at religious service, GLUHFWO\WRDEURDGFODVVRILQGLYLGXDOUHFLSLHQWVGHILQHG
placing those who fail to attend on "chapel probation," and ZLWKRXWUHJDUGWRUHOLJLRQ
clearly promotes spiritual development as the primary =REUHVW86DWBBB
objective of the institution. While the colleges in Roemer
gave mandatory religion and theology courses taught ,Q D FRQFXUULQJ RSLQLRQ LQ =HOPDQ -XVWLFH 2¶&RQQRU
"primarily by Roman Catholic clerics," those courses only H[SODLQHGWKDWDJRYHUQPHQWSURJUDPLVQRWFRQVWLWXWLRQDOO\
supplemented "a curriculum covering ‘the spectrum of a LQILUPVROHO\EHFDXVHDVXVWDQWLDOEHQHILWLVFRQIHUUHGRQD
liberal arts program.’" Roemer, 426 U.S. at 756. In contrast, UHOLJLRXV RUJDQL]DWLRQ 86 DW BBB 2¶&RQQRU -
the Bible classes at Lipscomb are central to the mission of the FRQFXUUHQFH 6KHH[SODLQHG
school, and the failure to pass a Bible course results in a
student being placed on "Bible probation," which subjects the $OWKRXJK PLOOLRQ LV QR VPDOO VXP LW SDOHV LQ
student to dismissal from the school if he or she does not pass FRPSDULVRQWRWKHDPRXQWRIIXQGVWKDWIHGHUDOVWDWHDQG
every Bible course taken while on Bible probation. Lipscomb ORFDOJRYHUQPHQWVDOUHDG\SURYLGHUHOLJLRXVLQVWLWXWLRQV
thus clearly stands separate and apart from the higher
6WHHOHHWDOY,QGXVWULDO 1RV 1RV 6WHHOHHWDOY,QGXVWULDO
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5HOLJLRXVRUJDQL]DWLRQVPD\TXDOLI\IRUH[HPSWLRQVIURP these four institutions requires its students to attend
WKH IHGHUDO FRUSRUDWH LQFRPH WD[ VHH 86& religious services. Although all four schools require their
F WKH FRUSRUDWH LQFRPH WD[ LQ PDQ\ 6WDWHV students to take theology courses, the parties stipulated
VHHHJ&DO5HY 7D[&RGH$QQG :HVW that these courses are taught according to the academic
DQGSURSHUW\WD[HVLQDOO6WDWHVVHH.7XUQHU requirements of the subject matter and the teacher's
3URSHUW\ 7D[ ([HPSWLRQV IRU 1RQSURILWV 2FW concept of professional standards. The parties also
3UREDWHDQG3URSHUW\ DQGFOHUJ\TXDOLI\IRUD stipulated that the courses covered a range of human
IHGHUDOWD[EUHDNRQLQFRPHXVHGIRUKRXVLQJH[SHQVHV religious experiences and are not limited to courses about
86& D ,Q DGGLWLRQ WKH )HGHUDO the Roman Catholic religion. The schools introduced
*RYHUQPHQW SURYLGHV LQGLYLGXDOV FRUSRUDWLRQV WUXVWV evidence that they made no attempt to indoctrinate
DQGHVWDWHVDWD[GHGXFWLRQIRUFKDULWDEOHFRQWULEXWLRQVWR students or to proselytize. Indeed, some of the required
TXDOLILHGUHOLJLRXVJURXSV6HH F )LQDOO\ theology courses at Albertus Magnus and Sacred Heart
WKH)HGHUDO*RYHUQPHQWDQGFHUWDLQVWDWHJRYHUQPHQWV are taught by rabbis. Finally, as we have noted, these
SURYLGH WD[ FUHGLWV IRU HGXFDWLRQDO H[SHQVHV PDQ\ RI four schools subscribe to a well-established set of
ZKLFKDUHVSHQWRQHGXFDWLRQDWUHOLJLRXVVFKRROV6HH principles of academic freedom, and nothing in this
HJ $ +RSH WD[ FUHGLW 0LQQ6WDW record shows that these principles are not in fact
6XSS followed. In short, the evidence shows institutions with
admittedly religious functions but whose predominant
0RVWRIWKHVHWD[SROLFLHVDUHZHOOHVWDEOLVKHGVHHHJ higher education mission is to provide their students with
0XHOOHU Y $OOHQ 86 XSKROGLQJ a secular education.
0LQQHVRWDWD[GHGXFWLRQIRUHGXFDWLRQDOH[SHQVHV :DO]
Y7D[&RPP
QRI&LW\RI1HZG@ QRU Id. at 163. Although the Fourth Circuit asserted that a college
LQKLELW>HG@UHOLJLRQDQGLILWGLGQRWIRVWHUDQH[FHVVLYH is not pervasively sectarian unless it possesses a "great many"
JRYHUQPHQW HQWDQJOHPHQW ZLWK UHOLJLRQ /HPRQ Y of the characteristics identified in the four-factor test, 159
.XUW]PDQ 86 LQWHUQDO F.3d at 163, there is nothing clearly stated in prior Supreme
TXRWDWLRQ PDUNV RPLWWHG ,Q $JRVWLQL Y )HOWRQ Court precedent to the effect that a pervasively sectarian
86 ZH IROGHG WKH instruction must possess "a great many" of the relevant
HQWDQJOHPHQWLQTXLU\LQWRWKHSULPDU\HIIHFWLQTXLU\7KLV characteristics; rather, the focus of the inquiry is whether
PDGH VHQVH EHFDXVH ERWK LQTXLULHV UHO\ RQ WKH VDPH
HYLGHQFHVHHLELGDQGWKHGHJUHHRIHQWDQJOHPHQWKDV religion so permeates the secular education functions
LPSOLFDWLRQVIRUZKHWKHUDVWDWXWHDGYDQFHVRULQKLELWV provided by a religious-affiliated educational institution that
UHOLJLRQ VHH /\QFK Y 'RQQHOO\ 86 its religious and secular educational functions are in fact
2
&21125-FRQFXUULQJ 7KHWHVWWRGD\LV inseparable. Further, I take issue with the statement by the
EDVLFDOO\ WKH VDPH DV WKDW VHW IRUWK LQ 6FKRRO 'LVW RI Fourth Circuit in Columbia Union I that "because the
$ELQJWRQ 7RZQVKLS Y 6FKHPSS 86 Supreme Court has never held any institution of higher
FLWLQJ (YHUVRQ Y %RDUG RI (G RI (ZLQJ education to be ‘pervasively sectarian,’ we lack even a clear
86 0F*RZDQY0DU\ODQG86 ‘general picture’ of a ‘pervasively sectarian’ college or
RYHU\HDUVDJR university." 159 F.3d at 163. In my view, the general profile
of a pervasively sectarian institution is not as difficult to
=HOPDQ 86 BBB 2¶&RQQRU - FRQFXUULQJ discern from Supreme Court jurisprudence as the Fourth
RSLQLRQ SDUDOOHOFLWDWLRQVRPLWWHG Circuit purports it to be. Although the Fourth Circuit
correctly recognized that "[n]either the Supreme Court, nor
$V WR WKH SULPDU\ SXUSRVH LQGXVWULDO UHYHQXH ERQGV any circuit court to our knowledge, has ever found a college
DGYDQFHDFOHDUJRYHUQPHQWDOVHFXODULQWHUHVWLQSURPRWLQJ to be pervasively sectarian," id. at 169, it is clear that the
HFRQRPLF DQG HGXFDWLRQDO GHYHORSPHQW 6XFK FRQGXLW Supreme Court certainly left open this possibility. See Hunt,
ILQDQFLQJDOVRSURPRWHVHFRQRPLFGHYHORSPHQWWKRXJKWKH 413 U.S. at 743 (citing Tilton v. Richardson, 403 U.S. 672,
XQGHUZULWLQJ RI MRESURGXFLQJ FRQVWUXFWLRQ SURMHFWV DW 682 (1971)); see also Va. Coll. Bldg. Auth. v. Lynn, 260 Va.
FROOHJHVDQGXQLYHUVLWLHV,QWXUQDPRUHHGXFDWHGSRSXODFH 608, 538 S.E.2d 682 (Va. 2000) (applying the elements of the
LV EHWWHU SRVLWLRQHG WR JHQHUDWH QHZ GHYHORSPHQW DQG Roemer test to find that Regent University, created under the
HFRQRPLFRSSRUWXQLW\,QDFDVHLQYROYLQJLQGXVWULDOUHYHQXH auspices of the Christian Broadcasting Network, Inc., is a
ERQGVIRUDSULYDWHUHOLJLRXVKLJKVFKRROWKLV&RXUWKHOGLQ pervasively sectarian institution).
-RKQVRQY(FRQRPLF'HYHORSPHQW&RUS)GDW
6WHHOHHWDOY,QGXVWULDO 1RV 1RV 6WHHOHHWDOY,QGXVWULDO
'HY%GHWDO 'HY%GHWDO
sectarian," the plurality opinion in Roemer noted that it was $VWDWH¶VGHFLVLRQWRDVVLVWEXVLQHVVHVLQWKHLURSHUDWLRQ
necessary to "paint a general picture of the institution, LQRUGHUWRFUHDWHDQGPDLQWDLQMREV±UHJDUGOHVVRIWKH
composed of many elements." Id. at 758. Summarizing the W\SH RI EXVLQHVVHV ± µHYLGHQFHV D SXUSRVH WKDW LV ERWK
elements of a sectarian profile set forth in the Court’s VHFXODUDQGXQGHUVWDQGDEOH¶0XHOOHU86DW
majority opinion in Comm. for Public Educ. and Religious 0LFKLJDQ FRXOG FRQFOXGH WKDW WKHUH LV D VWURQJ SXEOLF
Liberty v. Nyquist, 413 U.S. 756, 767-68 (1973), the plurality LQWHUHVWLQSURPRWLQJDVVLVWLQJDQGUHWDLQLQJFRPPHUFLDO
in Roemer stated: HQWHUSULVHVERWKVHFWDULDQDQGQRQVHFWDULDQ
The elements of the "profile" were that the schools $VWRWKHSURJUDP¶VSULPDU\HIIHFWWD[IUHHUHYHQXHERQGV
placed religious restrictions on admission and also KDYHQHLWKHUWKHHIIHFWRIDGYDQFLQJRULQKLELWLQJUHOLJLRQRU
faculty appointments; that they enforced obedience to DV -XVWLFH 2¶&RQQRU KDV ³SXW LW RI µHQGRUV>LQJ@ RU
religious dogma; that they required attendance at GLVDSSURY>LQJ@ UHOLJLRQ¶´ =HOPDQ 86 DW BBB
religious services and the study of particular religious 2¶&RQQRU - FRQFXUUHQFH FLWLQJ /\QFK Y 'RQQHOO\
doctrine; and that they were an ‘integral part’ of the 86DW FRQFXUULQJRSLQLRQ 0HWUR¶VSURJUDP³DVLQ
religious mission of the sponsoring church; that they had 0XHOOHUµ>@LVPDGHDYDLODEOHJHQHUDOO\ZLWKRXWUHJDUGWRWKH
religious indoctrination as a ‘substantial purpose’; and VHFWDULDQQRQVHFWDULDQ RU SXEOLFQRQSXEOLF QDWXUH RI WKH
that they imposed religious restrictions on how and what LQVWLWXWLRQ EHQHILWWHG¶´ =HOPDQ 86 DW BBB FLWLQJ
the faculty could teach. 0XHOOHU86DW
Roemer, 426 U.S. at 753 n. 18 (citing Nyquist, 413 U.S. at 7KHHIIHFWRI0HWUR¶VSURJUDPLVHFRQRPLFDQGHGXFDWLRQDO
767-68). GHYHORSPHQW0DQ\VWDWHVDQGORFDOJRYHUQPHQWVKDYHXVHG
LQGXVWULDO UHYHQXH ERQGV WR HQWLFH QHZ RU H[SDQGHG
In light of the views expressed in the majority opinions in PDQXIDFWXULQJFRPPHUFLDODQGHGXFDWLRQDOSURMHFWV7KHVH
Hunt and Nyquist, the proper starting point for evaluating the SURMHFWV SULYDWHO\ RZQHG DUH QRW ILQDQFHG ZLWK GLUHFW
Establishment Clause challenge in this case is to adopt the JRYHUQPHQWIXQGLQJEXWDUHJLYHQSUHIHUHQWLDOWD[WUHDWPHQW
profile for a pervasively sectarian educational institution WKURXJKFRQGXLWILQDQFLQJ/LSVFRPE8QLYHUVLW\VHHNVWKH
stated by the plurality in Roemer, as this most closely adheres VDPHW\SHRIILQDQFLQJIRUWKHH[SDQVLRQRILWVIDFLOLWLHVDV
to Supreme Court precedent expressed in majority opinions FRXOG EH VRXJKW E\ :DOPDUW 6HDUV RU HGXFDWLRQDO
on this topic. See Agostini, 521 U.S. at 237 (noting that "the LQVWLWXWLRQV 7KH /RDQ $JUHHPHQW EHWZHHQ WKH %RDUG DQG
Court of Appeals should follow the case which directly /LSVFRPE8QLYHUVLW\VSHFLILFDOO\SURKLELWVLWIURPXVLQJDQ\
controls, leaving to this Court the prerogative of overruling its ERQGILQDQFHGIDFLOLWLHVIRUUHOLJLRXVSXUSRVHV7KHSURMHFWV
own decisions"). /LSVFRPE8QLYHUVLW\VHHNVWRILQDQFHZRXOGSURYLGHQROHVV
HFRQRPLF GHYHORSPHQW WKDQ D QHZ VWRUH RU D QHZ
It should be noted that this approach accords with that taken PDQXIDFWXULQJIDFLOLW\
by the Fourth Circuit in Columbia Union Coll. v. Clarke, 159
F.3d 151 (4th Cir. 1998) ("Columbia Union I"), which )XUWKHU DV LQ WKH VFKRRO IXQGLQJ SURJUDP WKH 6XSUHPH
adopted a four-factor test that is essentially a restatement of &RXUW XSKHOG LQ =HOPDQ 0HWUR¶V LQGXVWULDO UHYHQXH ERQG
the Supreme Court’s profile of a pervasively sectarian SURJUDPGRHVQRWSUHVHQWWKHSHUFHSWLRQRIHQGRUVHPHQWWR
educational institution. In Columbia Union I, the Fourth WKHUHDVRQDEOHREVHUYHU³µ>7@KHUHDVRQDEOHREVHUYHULQWKH
6WHHOHHWDOY,QGXVWULDO 1RV 1RV 6WHHOHHWDOY,QGXVWULDO
'HY%GHWDO 'HY%GHWDO
HQGRUVHPHQWLQTXLU\PXVWEHGHHPHGDZDUH¶RIWKHµKLVWRU\ Aid normally may be thought to have a primary effect
DQGFRQWH[W¶XQGHUO\LQJDFKDOOHQJHGSURJUDP´=HOPDQ of advancing religion when it flows to an institution in
86DWBBBFLWLQJ*RRG1HZV&OXEY0LOIRUG&HQWUDO6FKRRO which religion is so pervasive that a substantial portion
86 $VWKH=HOPDQ&RXUWVWDWHG of its functions are [sic] subsumed in the religious
mission or when it funds a specifically religious activity
$Q\REMHFWLYHREVHUYHUIDPLOLDUZLWKWKHIXOOKLVWRU\DQG in an otherwise substantially secular setting.
FRQWH[WRIWKH2KLRSURJUDPZRXOGUHDVRQDEOHO\YLHZLW
DV RQH DVSHFW RI D EURDGHU XQGHUWDNLQJ WR DVVLVW SRRU Id. at 743. The Court in Hunt concluded that the aid did not
FKLOGUHQ LQ IDLOHG VFKRROV QRW DV DQ HQGRUVHPHQW RI go to a pervasively sectarian institution, nor to fund
UHOLJLRXVVFKRROLQJLQJHQHUDO specifically religious activities, and thus would not "place the
Authority in the position of providing aid to the religious as
=HOPDQ86DWBBB opposed to the secular activities." Id. at 744. Although Hunt
did not outline a test for identifying a pervasively sectarian
6LPLODUO\ LQ WKH LQVWDQW FDVH WKH REMHFWLYH REVHUYHU RI institution, the Court found that the Baptist college in
0HWUR¶VLQGXVWULDOUHYHQXHERQGSURJUDPNQRZLQJWKHKLVWRU\ question was not pervasively sectarian inasmuch as "there are
DQGFRQWH[WRIWKLVSURJUDPZRXOGUHDVRQDEO\YLHZLWDVRQH
DVSHFW RI D EURDGHU XQGHUWDNLQJ WR ILQDQFH HFRQRPLF no religious qualifications for faculty membership or student
GHYHORSPHQWQRWDVDQHQGRUVHPHQWRIUHOLJLRXVVFKRROLQJLQ admission, and that only 60% of the College student body is
JHQHUDO0HWURQRPRUHHQGRUVHG/LSVFRPE8QLYHUVLW\WKDQ Baptist, a percentage roughly equivalent to the percentage of
LWGLG:DO0DUWLQLVVXLQJLQGXVWULDOUHYHQXHERQGV Baptists in that area of South Carolina." 413 U.S. at 743-44.
,9&21&/86,21 Notwithstanding the absence in Hunt of an explicit test for
identifying a pervasively sectarian educational institution, the
%HFDXVHWKHSURSRVHGLVVXDQFHRILQGXVWULDOUHYHQXHERQGV plurality opinion in Roemer v. Bd. of Public Works of Md.,
WR/LSVFRPE8QLYHUVLW\LVSDUWRIDQHXWUDOSURJUDPWREHQHILW 426 U.S. 736 (1976) set forth a profile of a pervasively
HGXFDWLRQLQFOXGLQJWKDWSURYLGHGE\VHFWDULDQLQVWLWXWLRQV sectarian educational institution for evaluating Establishment
DQGFRQIHUVDWEHVWRQO\DQLQGLUHFWEHQHILWWRWKHVFKRROZH Clause claims. In Roemer, the Court considered an
KROGWKDWWKHLVVXDQFHRIWKHERQGVGRHVQRWYLRODWHWKH)LUVW Establishment Clause challenge to the constitutionality of a
$PHQGPHQW Maryland statute providing public aid in the form of grants
("Sellinger grants") to colleges affiliated with the Roman
,Q VXP WKH QDWXUH RI WKH LQVWLWXWLRQ LV QRW WKH UHOHYDQW Catholic Church. In Roemer, the plurality noted that "the
LQTXLU\LQWKHVSHFLDOW\SHRIDLGDWLVVXHLQWKLVDSSHDO7KH focus of the debate" concerned whether the grant program had
QDWXUHRIWKHDLGFRQIHUUHGE\WKHWD[IUHHUHYHQXHERQGVLV the primary effect of advancing religion and creating
QRWGLUHFWDLG,QVWHDGLWLVDQDORJRXVWRDQLQGLUHFWILQDQFLDO excessive church-state entanglement. As to the primary-effect
EHQHILW FRQIHUUHG E\ D UHOLJLRXVO\ QHXWUDO WD[ RU FKDULWDEOH question, the plurality in Roemer noted that "Hunt requires (1)
GHGXFWLRQ DQG LV LQGLVWLQJXLVKDEOH IURP WKDW H[SUHVVO\ that no state aid at all go to institutions that are so
DSSURYHGLQ:DO]VXSUD7KHIXQGLQJYHKLFOHLVDYDLODEOHRQ ‘pervasively sectarian’ that secular activities cannot be
DQHXWUDOEDVLV1RJRYHUQPHQWIXQGVZLOOEHH[SHQGHG1RU separated from sectarian ones, and (2) that if secular activities
GRHVDQ\KROGHURIDERQGKDYHUHFRXUVHDJDLQVWWKH%RDUGRU can be separated out, they alone may be funded." Id. at 755.
0HWUR LQ WKH HYHQW RI QRQSD\PHQW 7KH EHQHILW WR EH In determining whether an institution was "pervasively
6WHHOHHWDOY,QGXVWULDO 1RV 1RV 6WHHOHHWDOY,QGXVWULDO
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light least favorable to the non-moving party" in granting REWDLQHG E\ /LSVFRPE 8QLYHUVLW\ LV WKH VDPH SURYLGHG WR
summary judgment in favor of Plaintiffs. Lipscomb’s Br. at SULYDWH FRPSDQLHV ZKLFK FUHDWH LGHQWLFDO HFRQRPLF
7, n. 4. There is no merit to this claim because the district RSSRUWXQLWLHV 7KH FRQGXLW ILQDQFLQJ DGYDQFHV D FOHDU
court based its decision on the undisputed facts in the record, JRYHUQPHQWDO VHFXODU LQWHUHVW LQ SURPRWLQJ HFRQRPLF
which established as a matter of law that Lipscomb is a RSSRUWXQLW\ )LQDOO\ WKH UHYHQXH ERQG SURJUDP GRHV QRW
pervasively sectarian educational institution and that the loan SUHVHQWWKHSHUFHSWLRQRIJRYHUQPHQWHQGRUVHPHQWRIUHOLJLRQ
transaction amounted to a direct economic benefit for
Establishment Clause purposes. %DVHGRQWKHIRUHJRLQJZH5(9(56(WKHGLVWULFWFRXUW
JUDQW RI VXPPDU\ MXGJPHQW IRU SODLQWLIIV DQG 5(9(56(
The profile of a pervasively sectarian educational ERWK WKH GLVWULFW FRXUW¶V GHQLDO RI VXPPDU\ MXGJPHQW IRU
institution 0HWUR DQG LWV GHQLDO RI VXPPDU\ MXGJPHQW WR /LSVFRPE
8QLYHUVLW\
In evaluating whether Lipscomb is a pervasively sectarian
institution, our attention should be directed in the first
instance to Hunt v. McNair, 413 U.S. 734 (1973), since it is
the only case dealing with the precise issue at hand that
yielded a majority opinion. In Hunt, the Supreme Court also
addressed the issue of state aid to a religious school in a
challenge to the validity of the South Carolina Educational
Facilities Authority Act ("the Act"), under which revenue
bonds were issued to the Baptist College at Charleston, South
Carolina, a Baptist-affiliated college. Through the issuance
of the revenue bonds, the Act provided assistance to higher
educational institutions in constructing and financing projects,
such as buildings, facilities, and site preparation, specifically
excepting "any facility used or to be used for sectarian
instruction or as a place of religious worship nor any facility
which is used or to be used primarily in connection with any
part of the program of a school or department of divinity for
any religious denomination." Id. at 736.
Applying the factors set forth in Lemon, the Court in Hunt
held that the Act did not violate the Establishment Clause,
finding in pertinent part that the statute did not have the
primary effect of advancing or inhibiting religion insofar as
the college did not have a significant sectarian orientation and
the projects were limited to those with a secular purpose. In
Hunt, the Supreme Court noted:
6WHHOHHWDOY,QGXVWULDO 1RV 1RV 6WHHOHHWDOY,QGXVWULDO
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BBBBBBBBBBBBBBBB On appeal, Lipscomb first argues that the district court’s
grant of summary judgment in favor of Plaintiffs was
',66(17 erroneous because it rested upon a finding that Lipscomb is
BBBBBBBBBBBBBBBB a pervasively sectarian educational institution. According to
Lipscomb, "whether an institution is ‘pervasively sectarian’
&/$< &LUFXLW -XGJH GLVVHQWLQJ %HFDXVH 'DYLG is no longer a factor to be considered by the courts in these
/LSVFRPE 8QLYHUVLW\ ³/LSVFRPE´ LV LQGLVSXWDEO\ D kinds of cases." Lipscomb’s Br. at 7. However, as the
³SHUYDVLYHO\ VHFWDULDQ´ HGXFDWLRQDO LQVWLWXWLRQ DQG EHFDXVH majority opinion recognizes, the pervasively sectarian test has
WKHORZLQWHUHVWORDQWR/LSVFRPEWKURXJKWKHLVVXDQFHRIWKH not been abandoned. In Johnson v. Econ. Dev. Corp. of
WD[H[HPSWERQGVE\WKH,QGXVWULDO'HYHORSPHQW%RDUG ³WKH County of Oakland, 241 F.3d 501, 510 n. 2 (6th Cir. 2001),
%RDUG´ DPRXQWHGWRDGLUHFWHFRQRPLFEHQHILWLQYLRODWLRQRI this Court pointed out:
WKH(VWDEOLVKPHQW&ODXVHRIWKH)LUVW$PHQGPHQWRIWKH86
&RQVWLWXWLRQ, I would find that the district court did not err in The principle expressed in Hunt v. McNair, 413 U.S. 734
granting Plaintiffs’ cross-motion for summary judgment, (1973), that government aid in the form of tax exempt
denying the separate motions for summary judgment filed by revenue bonds of the type involved in this case violates
the Board and the Metropolitan Government ("Metro") and the Establishment Clause--when provided to pervasively
entering a permanent injunction prohibiting the Board and sectarian institutions--has not been disavowed, at least to
Metro from issuing additional tax-exempt bonds to Lipscomb my knowledge, by any subsequent majority opinion of
or tax-exempt bonds to any pervasively sectarian institution. the Supreme Court. Accord Agostini v. Felton, 521 U.S.
203, 233 (1997) (recognizing that under the
As will be conclusively demonstrated below, Lipscomb fits Establishment Clause, the court must consider " ‘the
the profile of a pervasively sectarian educational institution character and purposes of the institutions that are
by imposing religious restrictions on student admissions and benefitted’ . . . (e.g., whether the religious institutions
faculty and staff appointments; enforcing obedience to its were ‘predominantly religious’")) (citing Hunt, 413 U.S.
religious dogma, which is the "supreme purpose" of the at 734-44).
University; requiring daily Bible study and attendance at
chapel as an integral part of its religious mission; and placing 241 F.3d at 510 n. 2 (parallel citations omitted.) Although the
religious limitations on how and what the faculty teach. The majority notes that the Court questioned "[t]he vitality of the
low-interest loan of $15 million originated by the Board at pervasively sectarian test" in Mitchell v. Helms, 530 U.S. 793
Lipscomb’s request constituted a direct economic benefit (2000), we noted in Johnson that "it is Justice O’Connor’s
because it enabled Lipscomb to advance its sectarian mission opinion [in Mitchell], which does not abolish the distinction
by funding improvements to the University. Given its between ‘pervasively sectarian’ and ‘sectarian’ institutions
pervasively sectarian character, the direct economic benefit to and which expressly declines to adopt Justice Thomas’
Lipscomb results in excessive governmental entanglement expansive view, that is controlling upon this Court." Id.
with the religious mission of the University in violation of the
Establishment Clause. Alternatively, Lipscomb claims that even if the pervasive
sectarian test remains relevant, the district court’s decision
must be vacated and remanded for an evidentiary hearing
because the court improperly "viewed ambiguous facts in a
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DISCUSSION BACKGROUND
At the outset, it should be noted that Plaintiffs challenge Before addressing the substantive issues, it is helpful to
only the constitutionality of the Tennessee statute as applied, describe in detail the nature of Lipscomb, a private, not-for-
which authorized the Board to issue tax-exempt bonds to profit religious corporation affiliated with the Churches of
Lipscomb or any other pervasively sectarian institution. Christ, which was founded by David Lipscomb and James
Thus, the issue squarely presented on appeal is whether the Harding in 1891 and originally incorporated under the name
low-interest loan by the Board to Lipscomb funded through of "The Nashville Bible School."Characterizing itself as a
the issuance of the tax-exempt bonds violates the "small co-educational liberal arts university" with an
Establishment Clause because Lipscomb is a pervasively enrollment of approximately 2,500 students, Lipscomb states
sectarian educational institution and the loan amounts to that "its primary mission has been to integrate Christian faith
direct state aid. and practice with academic excellence." Among the
objectives of Lipscomb are "[t]o provide the very best in a
The point of departure for analyzing whether the low- Christian liberal arts education under the direction of
interest loan to Lipscomb through the issuance of the tax- Christian teachers in a distinctly Christian environment . . .
exempt bonds by the Board violated the Establishment Clause [t]o train future leaders in the church . . . [and] . . . [t]o hold
is the test set forth in Lemon v. Kurtzman, 403 U.S. 602, 612- up Christ as the example to follow in every field of activity."
13 (1971), as refined by the Court in Agostini v. Felton, 521 (J.A. at 38, 1249.)
U.S. 203, 232-33 (1997), which merged the excessive
government entanglement prong with the "primary effect" According to Lipscomb’s corporate charter and the bylaws
analysis. As the majority opinion notes, the Lemon test, as of the Board of Directors,
reformulated by Agostini, continues to have vitality. See
Zelman v. Simmons-Harris, 122 S. Ct. 2460, 2476 (2002) The corporation was organized for the purpose of
(O’Connor, J. concurring opinion). In the present case, the teaching the word of God and the various branches of the
question before us concerns whether the governmental action useful knowledge, commonly taught in institutions of
satisfies the "primary effect" test. Under this test, the Court learning for the following general purposes: the support
in Agostini stated that the governmental aid is permissible if of any literary or scientific undertaking, as a college or
"it does not result in governmental indoctrination; define its university with power to confer degrees, an academy, a
recipients by reference to religion; or create an excessive debating society lyceum, the establishment of a library,
entanglement." Id. at 234. In the matter before us, the the support of a historical society, the promotion of
specific issue is whether the governmental aid results in painting, music and the fine arts, the support of Board of
excessive entanglement. In assessing whether there is Trade or Chamber of Commerce or other objects of like
excessive entanglement, the Court in Agostini stated that "we
have looked to ‘the character and purposes of the institutions
that are benefited, the nature of the aid that the State provides, 7KLV SRUWUD\DO RI /LSVFRPE LV ODUJHO\ EDVHG XSRQ LWV RZQ
and the resulting relationship between the government and SXEOLFDWLRQV WKDW GDWH IURP WKH WLPH WKDW WKH %RDUG DSSURYHG /LSVFRPE¶V
religious authority.’" Id. at 232 (quoting Lemon, 403 U.S. at UHTXHVW IRU D ORDQ ILQDQFHG E\ WKH LVVXDQFH RI PLOOLRQ LQ WD[H[HPSW
ERQGV ,W VKRXOG EH QRWHG WKDW IRU WKH SXUSRVHV RI GHFLGLQJ WKH LVVXH RQ
615). DSSHDO WKHUH LV QRWKLQJ LQ WKH UHFRUG WR VXJJHVW WKDW WKH FXUUHQW
SXEOLFDWLRQV RI /LSVFRPE DUH PDWHULDOO\ GLIIHUHQW LQ DQ\ UHOHYDQW UHVSHFW
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nature, the support of public worship, the building of of its functions is subsumed in its religious mission, and that
churches and chapels and the maintenance of missionary the $15 million dollars in tax-exempt revenue bonds had the
undertakings. impermissible effect of promoting religion as a matter of law.
In support of their motion for summary judgment, Plaintiffs
(J.A. at 805, 829-30). To this end, the bylaws of Lipscomb submitted a statement of the undisputed facts. Thereafter, on
state that "[t]he President, with the assistance of vice July 3, 2000, Lipscomb submitted its verified response to
presidents and principals, shall maintain a Christian college Plaintiffs’ statement of undisputed material facts in support of
that shall perpetuate the high Christian ideals inaugurated by their motion for summary judgment.
Harding and Lipscomb, the founders of David Lipscomb
College, in which the Bible is made the book of most On October 24, 2000, the district court entered a
importance." (J.A. at 830-31.) memorandum and order granting Plaintiffs’ cross-motion for
summary judgment and denying Lipscomb and Metro’s
As noted in the President’s letter in the 1989-1990 edition respective motions for summary judgment. The district court
of the Student Handbook: "[W]e have a sincere interest in the also issued a permanent injunction enjoining the Board and
spiritual values of each student and faculty staff member. Metro from issuing any additional tax-exempt revenue bonds
Lipscomb has been built on Christian ideas. Daily Bible for the benefit of Lipscomb or any other pervasively sectarian
study and chapel provide direction but only you can make the institution. The district court further awarded Plaintiffs’
commitment to grow closer to God." (J.A. at 293.) nominal damages in the amount of $1.00 each and authorized
Lipscomb’s Faculty Handbook also provides: attorneys’ fees for Plaintiffs. Defendants then filed timely
notices of appeal. Subsequently, Defendants filed a motion
The mission of David Lipscomb University is to serve to stay further proceedings on the matter of attorneys’ fee
its students so that they may master knowledge and skills pending this appeal. On October 31, 2000, the district court
appropriate to them and become Christlike in attitude and granted the motion to stay proceedings on the attorneys’ fee
behavior. issue.
It must be kept firmly in the consciousness of all Metro also asked for a stay of the permanent injunction
connected with the institution administration, faculty, issued by the district court enjoining the Board and the Metro
students, and patrons that Lipscomb is a Christian from issuing any additional tax-exempt revenue bonds for the
school. In the original appeal for support, written by benefit of Lipscomb or any other pervasively sectarian
David Lipscomb, it was made clear that the Bible was to institution. On July 13, 2001, the district court denied
be the foundation upon which all else would center: Metro’s motion for a stay pending appeal. Thereafter, in a
motion filed on August 13, 2001, Metro appealed the district
The supreme purpose of the school shall be to court’s denial of its motion for a stay pending appeal. In an
teach the Bible as the revealed will of God to man order entered on September 25, 2001, this Court denied the
and as the only and sufficient rule of faith and motion for a stay pending appeal.
practice, and to train those who will attend in a pure
Bible Christianity, excluding from the faith all
opinions and philosophies of men, and from the
work and worship of the church of God all human
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at public hearings and meetings of the Board held on April inventions and devices. Such other branches of
10, April 16, and May 30, 1990.$WWKHPHHWLQJV3ODLQWLIIV learning may be added as will aid in the
RUWKHLUUHSUHVHQWDWLYHVFRPSODLQHGWKDWWKHLVVXDQFHRIWKH understanding and teaching of the Scriptures and as
WD[H[HPSW ERQGV IRU /LSVFRPE SURYLGHG JRYHUQPHQWDO will promote usefulness and good citizenship among
VXSSRUWWRDSHUYDVLYHO\VHFWDULDQLQVWLWXWLRQLQYLRODWLRQRI men.
WKH(VWDEOLVKPHQW&ODXVHRIWKH)LUVW$PHQGPHQWRIWKH86
&RQVWLWXWLRQ 2Q 0D\ 3ODLQWLIIV DV PXQLFLSDO (J.A. at 1627.) (emphasis in original.) The Faculty Handbook
WD[SD\HUV FRPPHQFHG WKH LQVWDQW DFWLRQ FKDOOHQJLQJ WKH continues by stating,
YDOLGLW\RIWKH%RDUG¶VDFWLRQLQLVVXLQJWD[H[HPSWUHYHQXH
ERQGVIRUWKHEHQHILWRI/LSVFRPE This purpose was further set forth in the deed
conveying the property on Spruce Street for the use of
Eventually, on October 9, 1998, Metro and Lipscomb the school as follows:
separately moved for summary judgment, alleging that the
issuance of the tax-exempt revenue bonds did not violate the . . . that the property shall be used for maintaining a
Establishment Clause. In support of their respective motions school in which, in addition to other branches of
for summary judgment pursuant to Rule 56 of the Federal learning, the Bible as the recorded will of God and the
Rules of Civil Procedure, both Metro and Lipscomb only standard of faith and practice in religion, excluding
submitted separate statements of the undisputed material facts all human systems and opinions and all innovations,
on October 9, 1998 and October 16, 1998, respectively. inventions, and devices of men from the service and
Plaintiffs responded to Defendants’ statements of the worship of God, shall be taught as a regular daily study
undisputed material facts and filed documents in opposition to all who shall attend said school and for no other
to Defendants’ motions for summary judgment. Plaintiffs purpose inconsistent with this object. The condition
also filed a statement of additional undisputed material facts being herein inserted at the request of the founders of the
in opposition to Defendants’ motions on November 9, 1998. proposed Bible School, the same is hereby declared
Both Defendants then responded to Plaintiffs’ statement of fundamental and shall adhere to the premises conveyed
additional undisputed material facts on November 20, 1998 as an imperative restriction upon their use so long as the
and December 2, 1998, respectively. same shall be owned by said Bible School, or its
Trustees, and to any and all property which may be
At oral argument on May 10, 2000, the district court purchased with the proceeds of said premises in case of
requested that Plaintiffs submit a cross-motion for summary sale or reinvestment, as hereinafter provided.
judgment. Pursuant to the district court’s order, Plaintiffs
filed a motion for summary judgment on May 30, 2000, David Lipscomb University is not, therefore, merely an
alleging that the issuance of the tax-exempt revenue bonds to institution which requires every student to take a lesson
Lipscomb violated the Establishment Clause because in the Bible each day; this study is the wellspring from
Lipscomb is so pervasively sectarian that a substantial portion which the university issued.
(J.A. at 1627-28.)
7KH OHDG 3ODLQWLII +DUROG ( 6WHHOH LV QR ORQJHU D SDUW\ DV D UHVXOW
RI KLV GHDWK RQ $SULO
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These ideas about the central importance of the Bible are HTXLSDQHZOLEUDU\ UHQRYDWHDQGFRQYHUWWKHROGOLEUDU\LQWR
echoed throughout Lipscomb’s catalogues. For example, in DGPLQLVWUDWLYHRIILFHV FRQVWUXFWDQLQWUDPXUDOEXLOGLQJ RU
the university catalogue for 1988-1989, Lipscomb states: VWXGHQWDFWLYLW\FHQWHU DQLQWUDPXUDOILHOG four new tennis
courts, and a baseball stadium; construct an addition to the
The Bible has always been considered the most Swang Business Center; make parking, landscaping and
important area of study for all students at DLC [David walkway improvements; and acquire computer and fiber optic
Lipscomb College]. The founders and those who have equipment.
followed them have held it to be important that every
student study the Bible in a class every day. Whatever At a public meeting on April 10, 1990, the Board approved
one’s major interest or life work, a thorough knowledge Lipscomb’s request for the loan, which was financed by the
of the biblical life principles is needed. issuance of $15 million in tax-exempt industrial development
bonds, pursuant to the Board’s authority under Tenn. Code
In daily classes the Bible is taught as the inspired word Ann. § 7-53-101(11)(A)(vii). After another public hearing on
of God. With the Bible itself as the text, students are May 30, 1990, the Board formally approved the issuance of
encouraged to apply the Bible principles of right living the bonds. On May 31, 1990, Nashville Mayor Bill Boner
to all aspects of personal and professional life. approved the issuance of the bonds, as required for tax-
exempt status under 26 U.S.C. § 147(f), thus certifying that
In view of the daily Bible classes, it can be said that the bonds served a public purpose.
every Lipscomb graduate unofficially "majors in Bible."
Those who formally major in Bible may give special The tax-exempt bonds were then sold to private investors
emphasis in one of the following areas: Biblical (bondholders), and the proceeds from the bonds were loaned
Languages, Missions, Preaching, Religious Education, or to Lipscomb, pursuant to the loan documents. According to
Youth Ministry. the loan agreement, Lipscomb was not to use the project
funds for sectarian instruction or religious worship.
(J.A. at 41-42.) These points are reinforced in the 1990-1991 Lipscomb is also obligated to pay all sums due on the bonds.
university catalogue: In January of 1991, the bonds were replaced by revenue
refunding bonds titled "Educational Facilities Revenue
The Daily Bible Requirement Refunding Bonds, Series 1991."
The supreme purpose of David Lipscomb University Defendant Sovran Bank, as trustee for the bondholders, was
is "to teach the Bible as the revealed will of God to man assigned the loan documents. Sovran Bank provided the
and as the only and sufficient rule of faith and practice, principal security for the bonds through a $15,969,453
and to train those who will attend in a pure Bible irrevocable letter of credit for the account of Lipscomb to
Christianity." To help fulfill this purpose, each regular Sovran Bank, N.A. as trustee for the bondholders. Additional
student must be enrolled in a Bible class each school day security was provided by a promissory note and loan
and also attend daily chapel services. agreement entered into by Lipscomb and the Board.
Every college or university has a right and even an Plaintiffs are state and local taxpayers residing in Davidson
obligation to be unique and distinctive based upon its County, Tennessee, who objected to the issuance of the bonds
6WHHOHHWDOY,QGXVWULDO 1RV 1RV 6WHHOHHWDOY,QGXVWULDO
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members of the Churches of Christ, particularly during chapel individual purpose. Few, if any, other colleges today
service. (J.A. at 1606-07.) Moreover, while Lipscomb require students to take regular daily classes in Bible
provided its students with a list of local churches in the study. Students who choose to attend David Lipscomb
community, it only named those affiliated with the Churches University should be interested and supportive of the
of Christ. (J.A. at 835-36.) Lipscomb also acknowledges that daily Bible requirement. The university has no authority
it prohibits students from dancing, consuming alcohol, using to suspend this requirement for any student.
tobacco, among other things, because it regards such conduct
as being "un-Christian conduct." (J.A. at 308-309, 835, 1191- (J.A. at 1253.) Lipscomb’s 1990-91 catalogue further
92, 1472-74.) provides:
In response to recommendations made by the Southern Although the daily Bible requirement is important enough
Association of Colleges and Schools, Lipscomb undertook a to be listed as a separate part of each student’s academic
major development project in the early 1990s to expand and program, it is also considered an integral part of the general
renovate its campus to accommodate an increase in education program at David Lipscomb College. No body
undergraduate enrollment to 3,000. To fund the project, of knowledge or study of any kind is as important as the
Lipscomb applied for a $15 million, low-interest loan from study of the Bible itself.
the Board. /LSVFRPE UHTXHVWHG IXQGLQJ WR FRQVWUXFW DQG
(J.A. at 41, 1254.)
Accordingly, taking and passing a daily Bible class is a
"fundamental requirement for attendance" at Lipscomb. (J.A.
The Board is a public corporation created under the authority of
Tenn. Code Ann. § 7-53-101 - § 7-53-311. Metro approved the creation at 39-40.) As set forth in Lipscomb’s student bulletin for
of the Board by resolution as provided in Tenn. Code Ann. § 7-53-201. 1991-92:
By law, all amendments to the corporate charter of the Board must also
be approved by Metro. Tenn. Code Ann. § 7-53-204 (1985). Under the The Bible has always been considered the most
statute, the Board has the authority to enter into loan agreements with important area of study for all students at David
third parties; it can sue and be sued; it can sell any of its properties; it can
issue bonds and borrow money from banks and other financial institutions Lipscomb University. The founders, and those who have
by issuing notes. Tenn. Code Ann. § 7-53-204. In addition, the Board has followed them, have held it to be important that every
the authority to issue tax-exempt revenue bonds for various public work student study the Bible. Whatever their major interest or
projects, including life work, a thorough knowledge of Biblical principles is
needed.
[a]ny nonprofit educational institution in any manner related to
or in furtherance of the educational purposes of the institution, In daily classes, Bible is taught as the inspired word of
including, but not limited to classroom, laboratory, housing,
administrative, physical education and medical research and God. Students are encouraged to apply the Bible
treatment facilities. principles of right living to all aspects of personal and
professional life.
Tenn. Code Ann. § 7-53-101(11)(A)(vii)(1990 Supp.). After the approval
and sale of the tax-exempt bonds under the statute, the municipal
governments that approve them are not liable for repayment of the debt.
Tenn. Code Ann. § 7-53-306 (1985).
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(J.A. at 836-37, 1260.) These ideas were continually DIWHU P\ GLVFRYHU\ GHSRVLWLRQ LQ WKH FDVH RI 6WHHOH Y
expressed in the editions of the Student Handbook from 1988 ,QGXVWULDO'HYHORSPHQW%RDUGHWDODQG,ZDVWKLQNLQJ
through 1992: DERXWWKHVHLVVXHV +HWROGKRZKHUHTXLUHGWKHVWXGHQWV
LQKLV'DYLG/LSVFRPE8QLYHUVLW\VRFLRORJ\FODVVFDOOHG
Because the Bible is the heart of Lipscomb’s ³7KH)DPLO\´WRDQVZHUDTXHVWLRQRQ(SKHVLDQV7KH
curriculum, every regular student studies the Bible every TXHVWLRQZDVZKHWKHUWKH\DFFHSWHGWKHGRFWULQHWKDWD
school day. Offerings in the Department of Bible are PDQPXVWEH³KHDG´RIWKHZLIH+HZDVVKRFNHGDQG
arranged so that a student can, in four years, have XSVHWWKDWRQHRIKLVVWXGHQWVKDGRQFHDFWXDOO\VDLGVKH
exposure to the entire Bible. GLGQ¶WDJUHHZLWKWKHVFULSWXUH+HFLWHGWKLVLQFLGHQWDV
SURRIRI³WKHULVLQJWLGHRILPPRUDOLW\´+HGLGQRWVWDWH
Any student who fails Bible is automatically placed on ZKHWKHUKHJUDGHGWKHVWXGHQWSRRUO\
probation for the succeeding semester. Probation must
be removed by passing each Bible course carried during -$DW
the semester of probation. Failure to meet this
requirement means that the student will be dropped at the During the years from 1990 to1992, at the time of the
end of the semester. issuance of the bonds, more than 77% of the undergraduate
students at Lipscomb were members of the Churches of
(J.A. at 303, 1189, 1212, 1235.) As explained by Dr. Joe Mac Christ. (J.A. at 837, 1181.) According to the affidavit of W.
Lynn, the head of Lipscomb’s Bible Department, each student Craig Bledsoe, the Provost at Lipscomb since 1997, 78.97%
is required to have two credit hours of Bible each semester in of the student body indicated that they were members of the
order to graduate from Lipscomb. (J.A. at 1504-5.) From Churches of Christ in 1991, while 71.42% of the student body
1988 until September 1992, approximately 100 undergraduate so indicated in 1997. (J.A. at 502.) Student applications for
students were on "Bible probation." (J.A. at 834.) As noted admission to Lipscomb during these years "required a
in the Student Handbooks, students who do not pass every character reference from a minister, youth minister or leader
Bible course carried while on probation are subject to at church," without specifying the denomination of the church
dismissal from the school. or the religion. (J.A. at 837.) As expressed in a brochure
from Lipscomb, "[o]ne common thread that binds students
In addition to daily Bible study, Lipscomb also requires together is their commitment to Christ. At Lipscomb a
every full-time student to attend chapel each school day. student’s love for the Lord is strengthened by this special
(J.A. at 833.) As stated in Lipscomb’s Faculty Handbook: association with other students, the majority of whom share
the same spiritual values." (J.A. at 1635.) In his affidavit,
Chapel Bledsoe also stated that "there are numerous other religions
represented in the student body including, for example,
The heart of each day’s activities at David Lipscomb Buddhism, Lutheran, Muslim, Russian Orthodox, Hindu,
University is the chapel service. It is here that the entire Catholic, Mormon, Baptist, and Nazarene." (J.A. at 502). In
Lipscomb family gains strength and inspiration for the his supplemental affidavit, Bledsoe averred that "Lipscomb
tasks of the day. Since attendance at chapel is does not discriminate against students on the basis of
compulsory for all students, it is expected that each religion." (J.A. at 775.) Nevertheless, Dr. Sinclair testified
faculty member will attend chapel regularly. No in her deposition that students were pressured to become
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-$ DW 8QGHU WKH VXEKHDGLQJ RI ³$FDGHPLF arrangements should be made which require regular
)UHHGRP´WKH)DFXOW\+DQGERRNDGGV chapel absences of one or more times each week without
prior written approval of the dean.
(DFKPHPEHURIWKH/LSVFRPEIDFXOW\LVFRPPLWWHG
ERWK E\ SHUVRQDO FRQYLFWLRQ DQG E\ FRQWUDFW WR WKH (J.A. at 1401.) (emphasis in original.) As set forth in the
SXUSRVHVDQGLGHDOVRIWKHLQVWLWXWLRQDVVHWIRUWKE\WKH editions of the Student Handbook from 1988 through 1992, a
IRXQGHUVDQG%RDUGRI'LUHFWRUV:LWKLQWKLVIUDPHZRUN student with eleven absences from chapel during a semester
HDFKWHDFKHULVIUHHWRSXUVXHDQGWHDFKWUXWKLQKLVKHU is placed on "chapel probation." (J.A. at 303, 1189-90, 1212-
UHVSHFWLYH ILHOG RI OHDUQLQJ 6LQFH WUXWK LV FRQVLVWHQW 13, 1235-36.) From 1990 through 1992, an average of 40 to
HYHU\ZKHUH WKLV EDVLF FRPPLWPHQW PDNHV SRVVLEOH 60 students were on "chapel probation" each semester. (J.A.
DFDGHPLF IUHHGRP ZLWKRXW WKH QHFHVVLW\ RI D IRUPDO at 833, 1463.) The Student Handbooks also provide that "[i]f
VWDWHPHQW flagrant disregard for chapel attendance persists, a student is
subject to immediate suspension." (J.A. at 304.) In his
(J.A. at 1305.) According to Dr. Sinclair, who has had a long deposition, Dr. Dennis Loyd, the Dean of Students at
association with Lipscomb in addition to teaching there, the Lipscomb, testified that every full-time student "knows he
administration at Lipscomb directed members of the faculty goes to chapel," and that failure to do so results in dismissal.
to teach certain religious doctrines or views in courses given (J.A. at 1455-59.)
in the Biology and Physics Departments, where faculty
members are "instructed to teach creationism." (J.A. at 1616- As stated in the bylaws of the Board of Directors, each
17.),QKHUDIILGDYLW'U6LQFODLUDOVRVWDWHG director at Lipscomb must be a member of the Churches of
Christ in good standing in the congregation. (J.A. at 110.)
7KRVH ZKR DUH QRW IDPLOLDU ZLWK WKH FKXUFK RI The Board of Directors elects the president to be its chief
&KULVWKDYHGLIILFXOW\XQGHUVWDQGLQJWKHUHVWULFWLYHQDWXUH executive officer in charge of "its business and Christian
RILWVEHOLHIV7KH%LEOHLVWDNHQYHU\OLWHUDOO\DQGYHU\ education affairs." (J.A. at 115.) The bylaws also provide
UHVWULFWLYHO\ )RU H[DPSOH ZRPHQ DUH QRW DOORZHG WR that "great care should be exercised in the selection and
KROGDQ\OHDGHUVKLSSRVLWLRQVRIDQ\NLQG:RPHQDUH development of [] teaching personnel." (J.A. at 116.)
QRWDOORZHGWRVSHDNLQDQ\ZRUVKLSVHUYLFH:RPHQDUH Moreover, all personnel, with the exception of employees of
QRWDOORZHGWROHDGVLQJLQJWRPDNHDQQRXQFHPHQWVRU its services, building and grounds departments, shall be
WRWHDFKLQDQ\JURXSZKHUHPHQDUHSUHVHQW:RPHQDUH members in good standing of the Churches of Christ. (J.A. at
QRW DOORZHG WR JR WR EXVLQHVV PHHWLQJV RI WKH FKXUFK 832.) Lipscomb also reserves the right under Title VII of the
:RPHQKDYHQRYRWHLQDQ\PHHWLQJV ZRPHQKDYHQR
VD\LQKRZWKHPRQH\FROOHFWHG LV VSHQW:RPHQDUH Civil Rights Act of 1964 (as amended) to discriminate,
WDXJKWWR³EHLQVXEPLVVLRQ´DWKRPHDQGLQWKHFKXUFK "where it is necessitated by the specific religious tenets held
by the institution." (J.A. at 834, 1250.)
,QRUGHUWRVHHKRZWKLVGRFWULQHDIIHFWVWHDFKLQJ
DQG DFDGHPLF IUHHGRP DW /LSVFRPE , UHFDOO D VSHHFK In addition, Lipscomb President Harold Hazelip
+ROOLV 7RGG SURIHVVRU RI WKH VRFLRORJ\ GHSDUWPHQW DW acknowledged in his deposition testimony that all of its
/LSVFRPEDQGDQHOGHUDWP\FKXUFKJDYHRQ1RYHPEHU faculty must be members in good standing of the Churches of
,WRRNQRWHVRQLWEHFDXVHLWZDVDIHZGD\V Christ, and that leaving the church is grounds for termination
of employment. (J.A. at 1167, 1169.) In a letter to Nashville
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Mayor Boner opposing the bond issue, Norman Parks, the 3URIHVVRUV¶ ³$$83´ 6WDWHPHQWRI3ULQFLSOHVRQ$FDGHPLF
former dean of Lipscomb, remarked: )UHHGRP,QFRQWUDVW/LSVFRPE¶V)DFXOW\+DQGERRNVWDWHV
No person can be employed at Lipscomb who is not a ,Q WKH ILQDO DQDO\VLV WKH ZRUWK RI DQ\ HGXFDWLRQDO
member of the mainline Church of Christ. He cannot be LQVWLWXWLRQLVGHWHUPLQHGE\LWVIDFXOW\,WLVRIVSHFLDO
a premillennialist or believe that instrumental music is LPSRUWDQFHLQWKH&KULVWLDQXQLYHUVLW\WKDWHYHU\WHDFKHU
acceptable for worship of God. He must believe that a EHILUVWGHGLFDWHGWR&KULVWDQG+LVWUXWKGHPRQVWUDWLQJ
divorced person cannot remarry and continue in church. WKRVHTXDOLWLHVRIKHDUWDQGOLIHZKLFKZLOOLQVSLUH\RXQJ
He must believe that a woman cannot teach a class in SHRSOHWRORYHWKH/RUGDQGVWULYHWRSOHDVH+LP7KLV
religion to men. GHYRWLRQ PXVW EH DFFRPSDQLHG E\ VRXQG VFKRODUVKLS
DZDUHQHVVRIVWXGHQWQHHGVDQGDGHWHUPLQHGGHVLUHWR
(J.A. at 1142.) In this regard, Dr. Lynn, the head of VHUYH
Lipscomb’s Bible Department, testified in his deposition that
a divorced teacher may be allowed to remain as a teacher at
the university, but "[a] person who divorces and remarries
during the [] employment relationship to [sic] the University
would be subject to discipline or to dismissal." (J.A. at 1539.) 7KH $$83¶V SULQFLSOHV SURYLGH
According to Dr. Susan Dennison Sinclair, she was informed D 7HDFKHUV DUH HQWLWOHG WR IXOO IUHHGRP LQ UHVHDUFK DQG LQ WKH
by the department chairman when she was hired as an adjunct SXEOLFDWLRQ RI WKH UHVXOWV VXEMHFW WR WKH DGHTXDWH SHUIRUPDQFH
professor in the English Department for one semester in 1990 RI WKHLU RWKHU DFDGHPLF GXWLHV EXW UHVHDUFK IRU SHFXQLDU\ UHWXUQ
WKDW³KHZRXOGQRWEHDOORZHGWRUHFRPPHQGPHEDVHGRQ VKRXOG EH EDVHG XSRQ DQ XQGHUVWDQGLQJ ZLWK WKH DXWKRULWLHV RI
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