Steele v. Indust Dev Bd

• Court: Court of Appeals for the Sixth Circuit
• Decided: August 14, 2002
• Docket: 00-6649
• Status: Published

Opinion

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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 WRI1DVKYLOOHDQG'DYLGVRQ&RXQW\)G 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 LVVXHZKLFKDUHWREHXVHGGLUHFWO\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*DTXDOLILHGF 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 DSSURYDOUHTXLUHPHQWRIVHFWLRQI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)6XSSGDWHPSKDVLVDGGHG 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  'HY%GHWDO   'HY%GHWDO

that a direct economic benefit accrues to such an institution as /LSVFRPE8QLYHUVLW\¶VFDPSXV7KLVPHHWVWKHSULYDWHORDQ a result of the government’s active participation in arranging ILQDQFLQJWHVWRIVHFWLRQF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 PHHWWKHFULWHULDXQGHUVHFWLRQH7KHERQGVPHHWWKH subsidies of religious activities would constitute ILUVWFULWHULDIRUEHLQJDTXDOLILHGSULYDWHDFWLYLW\ERQGXQGHU impermissible state involvement with religion, tax VHFWLRQH EHFDXVHWKHERQGVDUHTXDOLILHGF  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 $TXDOLILHGF ERQGLVGHILQHGLQVHFWLRQD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'$5'2)5(9,(: argument that Lipscomb’s economic benefit came from the bond purchasers who purchased the tax-exempt revenue 7KLV&RXUWUHYLHZVWKHGLVWULFWFRXUW¶VJUDQWRIVXPPDU\ bonds, and not from the government. Properly understood, MXGJPHQWGHQRYR6HH*ULEFKHFNY5XQ\RQ)G Lipscomb received a direct economic benefit in the form of a WK&LU7KHVWDQGDUGVDSSOLFDEOHWRVXFKUHYLHZ low-interest government sponsored loan. For Establishment DUHZHOOHVWDEOLVKHG Clause purposes, it is immaterial that the Board subsequently assigned the loan to Sovran Bank. 6XPPDU\ MXGJPHQW LV DSSURSULDWH ZKHUH QR JHQXLQH LVVXHRIPDWHULDOIDFWH[LVWVVRWKDWWKHPRYDQWLVHQWLWOHG The district court also correctly rejected Defendants’ WRMXGJPHQWDVDPDWWHURIODZ)HG5&LY3F7KH argument that the bondholders, not Lipscomb, are the true FRXUWGHWHUPLQHVZKHWKHU³WKHUHDUHDQ\JHQXLQHIDFWXDO beneficiaries of the aid program. As the district court LVVXHVWKDWSURSHUO\FDQEHUHVROYHGRQO\E\DILQGHURI properly noted, the Supreme Court in Hunt examined a IDFWEHFDXVHWKH\PD\UHDVRQDEO\EHUHVROYHGLQIDYRURI similar transaction and found that "[t]he income tax-exempt HLWKHUSDUW\´$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 † II   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&LY3H$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)GWK &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  6WHHOHHWDOY,QGXVWULDO 1RV 1RV 6WHHOHHWDOY,QGXVWULDO  'HY%GHWDO   'HY%GHWDO

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the present case under Walz v. Tax Comm'n, 397 U.S. WHDFK D ZLGH YDULHW\ RI VHFXODU FRXUVHV WKH FHQWUDO 664, 90 S.Ct. 1409, 25 L.Ed.2d 697 (1970), where this PLVVLRQ RI WKH VFKRRO LV WR LQFXOFDWH DQG SURPRWH Court upheld a local property tax exemption which &KXUFKHV RI &KULVW GRFWULQH DV WKH WUXH ZRUG RI *RG included religious institutions. 6WXGHQWV DUH WDXJKW HQWLUHO\ E\ &KXUFKHV RI &KULVW PHPEHUVDUHLQIRUPHGRIWKHLPSRUWDQFHRIWKH%LEOHLQ 413 U.S. at 745 n. 7 (emphasis added). Equally, in Johnson, DOO DUHDV RI WKHLU OLYHV DUH H[SHFWHG WR DWWHQG %LEOH this Court declined to resolve whether a very similar type of FRXUVHVDQGFKDSHORQDGDLO\EDVLVDQGVXUURXQGHGE\DQ tax-exempt revenue bond issue amounts to a direct benefit HQYLURQPHQWWKRURXJKO\VDWXUDWHGE\&KXUFKHVRI&KULVW because it held that the religious academy was not a GRFWULQH7KHVFKRROGRHVQRWIROORZWKH 6WDWHPHQWRI pervasively sectarian educational institution. 241 F.3d at 511, 3ULQFLSOHVRQ$FDGHPLF)UHHGRPRIWKH$$83DQGWKH n. 3. However, unlike those cases in which the institutions VHFWLRQ RI WKH IDFXOW\ KDQGERRN GHDOLQJ ZLWK UHVHDUFK were found not to be pervasively sectarian, the issue must be VWDWHVWKDWWKHSULPDU\DLPRIHYHU\LQVWUXFWRUVKRXOGEH directly confronted here because Lipscomb is an institution in WRJLYHVXSHULRUDFDGHPLFLQVWUXFWLRQHPSKDVL]LQJGDLO\ which religion is so pervasive that a substantial portion of its LQVWUXFWLRQLQWKH%LEOH/LSVFRPE V%RDUGRI'LUHFWRUV functions is subsumed in the religious mission so as to ZKLFK FRQWUROV DOO  PDMRU GHFLVLRQV RI WKH VFKRRO suggest that the state aid to Lipscomb has the primary effect FRQWDLQV RQO\ PHPEHUV RI WKH &KXUFK RI &KULVW of advancing religion. &KULVWLDQHGXFDWLRQLVRQHRIWKHWKUHHSULQFLSDOGXWLHVRI WKH SUHVLGHQW RI WKH VFKRRO ,Q WKLV HQYLURQPHQW WKH ,Q GHFLGLQJ WKLV TXHVWLRQ LW LV DGYLVDEOH WR PDNH VRPH FKDQFH WKDW UHOLJLRQ ZRXOG VHHS LQWR WKH WHDFKLQJ RI SUHOLPLQDU\ REVHUYDWLRQV  )LUVW although the majority VHFXODUVXEMHFWVDVGLVFXVVHGLQ5RHPHU86DW opinion correctly notes that this precise issue has not been 6&WDWVHHPVLQHYLWDEOH addressed by other circuits or by the Supreme Court, it inaccurately states that all the state courts that have addressed ,G DW  LQWHUQDO FLWDWLRQV RPLWWHG  $FFRUGLQJO\ WKH the issue "have found that the issuance of industrial revenue GLVWULFWFRXUWIRXQGWKDW/LSVFRPE8QLYHUVLW\LVDSHUYDVLYHO\ bonds is not tantamount to the giving of direct aid to religious VHFWDULDQLQVWLWXWLRQ schools." Opn. at n. 2. However, with the exception of the Virginia Supreme Court’s decision in Lynn, 538 S.E.2d at 7KHYLWDOLW\RIWKHSHUYDVLYHO\VHFWDULDQWHVWLVTXHVWLRQDEOH 682, none of the cases cited by the majority has addressed the LQ OLJKW RI VXEVHTXHQW PRUH UHFHQW GHFLVLRQV IURP WKH precise question at hand, namely, ZKHWKHUWD[H[HPSWERQG 6XSUHPH&RXUW,Q0LWFKHOOY+HOPV86 ILQDQFLQJ WR D SHUYDVLYHO\ VHFWDULDQ HGXFDWLRQDO LQVWLWXWLRQ VL[ RI QLQH -XVWLFHV UHMHFWHG DQ (VWDEOLVKPHQW &ODXVH FRQVWLWXWHG D IRUP RI GLUHFW VWDWH DLG KDYLQJ WKH SULPDU\ FKDOOHQJH WR ORDQV RI HGXFDWLRQDO PDWHULDOV GLUHFWO\ WR HIIHFWRIDGYDQFLQJUHOLJLRQLQYLRODWLRQRIWKH(VWDEOLVKPHQW SDURFKLDOVFKRROV-XVWLFH6RXWHUSRLQWHGRXWLQKLVGLVVHQWLQJ &ODXVH,QGHHGDVQRWHGE\WKH&DOLIRUQLD6XSUHPH&RXUWLQ RSLQLRQWKDW³>1@RRQHLQGHHGGLVSXWHVWKDWWKH5RPDQ &DOLI(GXF)DFLOLWLHV$XWKY3ULHVW3GQ &DWKROLFVFKRROVZKLFKPDGHXSWKHPDMRULW\RIWKHSULYDWH &DORQHRIWKHFDVHVFLWHGE\WKHPDMRULW\ VFKRROVSDUWLFLSDWLQJZHUHSHUYDVLYHO\VHFWDULDQ´,QKLV SOXUDOLW\RSLQLRQ-XVWLFH7KRPDVUHVSRQGHGE\VWDWLQJWKDW 2IFRXUVHLIWKH$XWKRULW\ZHUHWRH[HUFLVHLWVSRZHUVLQ DLGRIDQLQVWLWXWLRQZKLFKLVSHUYDVLYHO\VHFWDULDQZLWKLQ >7@KHGLVVHQWLVFRUUHFWWKDWWKHUHZDVDSHULRGRIWLPH ZKHQWKLVIDFWRUPDWWHUHGSDUWLFXODUO\LIWKHSHUYDVLYHO\  6WHHOHHWDOY,QGXVWULDO 1RV 1RV 6WHHOHHWDOY,QGXVWULDO  'HY%GHWDO   'HY%GHWDO

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 267 A.2d 503, 506-507 (1970). The South Carolina Supreme Court, in the opinion below, )XUWKHUWKH6XSUHPH&RXUWKDVVSHFLILFDOO\VWDWHGWKDWWKH described the role of the State as that of a "mere conduit." ORZHUFRXUWVDUHWRWUHDWLWVSULRUFDVHVDVFRQWUROOLQJXQWLOWKH 258 S.Ct., at 107, 187 S.E.2d, at 650. Because we 6XSUHPH&RXUWLWVHOIVSHFLILFDOO\RYHUUXOHVWKHP$JRVWLQLY conclude that the primary effect of the assistance )HOWRQ86,QUHDIILUPLQJLWVSULRU afforded here is neither to advance nor to inhibit religion PDQGDWHWKH&RXUWQRWHGLQ$JRVWLQLWKDW³LIDSUHFHGHQWRI under Lemon and Tilton, we need not decide whether, as WKLV&RXUWKDVGLUHFWDSSOLFDWLRQLQDFDVH\HWDSSHDUVWRUHVW appellees argue, Brief for Appellees 14, the importance RQUHDVRQVUHMHFWHGLQVRPHRWKHUOLQHRIGHFLVLRQVWKH&RXUW of the tax exemption in the South Carolina scheme brings  6WHHOHHWDOY,QGXVWULDO 1RV 1RV 6WHHOHHWDOY,QGXVWULDO  'HY%GHWDO   'HY%GHWDO

encourages faculty to "pursue truth . . . by research, RI$SSHDOVVKRXOGIROORZWKHFDVHZKLFKGLUHFWO\ FRQWUROV discussion, and other forms of inquiry." Nonetheless, OHDYLQJ WR WKLV &RXUW WKH SUHURJDWLYH RI RYHUUXOLQJ LWV RZQ Regent prohibits faculty from using "their position or GHFLVLRQV´  ,G FLWLQJ 5RGULJXH] GH 4XLMDV Y classroom as a platform to demand adherence by students 6KHDUVRQ$PHULFDQ([SUHVV,QF86 to a personal theological viewpoint, political preference ,W LV IRU WKH 6XSUHPH &RXUW QRW WKLV &RXUW WR MHWWLVRQ WKH or social agenda." The SACS in a review of Regent’s SHUYDVLYHO\VHFWDULDQWHVWZKLFKLWKDVQRWGRQH accreditation application in 1998 found that "[f]aculty and students are free to examine all pertinent data, 5HJDUGOHVVRIZKHWKHUWKHSHUYDVLYHO\VHFWDULDQWHVWLVVWLOO question assumptions, be guided by the evidence of WKH ODZ ZH FRQFOXGH WKDW JLYHQ WKH QDWXUH RI WKH DLG LQ scholarly research, and teach and study the substance of TXHVWLRQ WKH LVVXH RI WKH ERQGV GRHV QRW RIIHQG WKH a given discipline." With respect to its curriculum, each (VWDEOLVKPHQW&ODXVH faculty member at Regent is required to include in the syllabus for each class a "description of how the %1DWXUHRIWKH,QVWLWXWLRQ5HFHLYLQJWKH$LG Christian faith and the Bible will be incorporated into the course." 7KHSUHFLVHW\SHRIDLGDWLVVXHLQWKLVDSSHDOLVYLUWXDOO\ LGHQWLFDO WR WKH ERQGLQJ PHFKDQLVPV LQYROYHG LQ +XQW Y Id. at 617-18. 0F1DLU867KH6XSUHPH&RXUWGHVFULEHG WKHSURJUDPDVIROORZV Like Regent, the "supreme purpose" of Lipscomb is to promote Christian ideals. Both Lipscomb and Regent also 7KHVWDWHDLGLQYROYHGLQWKLVFDVHLVRIDYHU\VSHFLDO require applicants to submit a recommendation from a VRUW:HKDYHKHUHQRH[SHQGLWXUHRISXEOLFIXQGVHLWKHU member of the clergy, without specifying the denomination. E\ JUDQW RU ORDQ QR UHLPEXUVHPHQW E\ D 6WDWH IRU However, unlike Regent, nearly three-quarters of the students H[SHQGLWXUHVPDGHE\DSDURFKLDOVFKRRORUFROOHJHDQG QRH[WHQGLQJRUFRPPLWWLQJRID6WDWH VFUHGLW5DWKHU at Lipscomb are identified with a particular creed, the WKH RQO\ VWDWH DLG FRQVLVWV QRW RI ILQDQFLDO DVVLVWDQFH Churches of Christ. Further, in contrast to Regent, which GLUHFWO\RULQGLUHFWO\ZKLFKZRXOGLPSOLFDWHSXEOLFIXQGV encourages, but does not require, its students to attend chapel RU FUHGLW EXW WKH FUHDWLRQ RI DQ LQVWUXPHQWDOLW\ WKH services or to participate in certain religious activities, daily $XWKRULW\WKURXJKZKLFKHGXFDWLRQDOLQVWLWXWLRQV PD\ Bible class and chapel attendance are mandatory at Lipscomb. ERUURZ IXQGV RQ WKH EDVLV RI WKHLU RZQ FUHGLW DQG WKH In addition, while both schools require its faculty to adhere to VHFXULW\ RI WKHLU RZQ SURSHUW\ XSRQ PRUH IDYRUDEOH religious principles and to incorporate the Bible into class LQWHUHVWWHUPVWKDQRWKHUZLVHZRXOGEHDYDLODEOH7KH instruction, Regent provides much greater latitude in terms of 6XSUHPH &RXUW RI 1HZ -HUVH\ FKDUDFWHUL]HG WKH academic freedom than Lipscomb. Thus, even among DVVLVWDQFHUHQGHUHGDQHGXFDWLRQDOLQVWLWXWLRQXQGHUDQ pervasively sectarian religious institutions, Lipscomb clearly DFWJHQHUDOO\VLPLODUWRWKH6RXWK&DUROLQD$FWDVPHUHO\ stands out as unrelentingly sectarian in its policies and EHLQJ D JRYHUQPHQWDO VHUYLFH  7KH 6RXWK &DUROLQD practices. 6XSUHPH&RXUWLQWKHRSLQLRQEHORZGHVFULEHGWKHUROH RIWKH6WDWHDVWKDWRIDPHUHFRQGXLW +XQW86DWQ  6WHHOHHWDOY,QGXVWULDO 1RV 1RV 6WHHOHHWDOY,QGXVWULDO  'HY%GHWDO   'HY%GHWDO

7KLV SDVVDJH ZRXOG VHHP WR LQGLFDWH WKDW D SXEOLF ERG\ Vision--Our vision, through our graduates and other FRXOG VHUYH DV D FRQGXLW WR DOORZ D SHUYDVLYHO\ VHFWDULDQ scholarly activities, is to provide Christian leadership in LQVWLWXWLRQWRUHFHLYHWKHEHQHILWVRIWD[IUHHERQGVVRORQJDV transforming society by affirming and teaching principles SXEOLF IXQGV ZHUH QRW H[SHQGHG  5DWKHU WKDQ UHDFK VXFK of truth, justice and love as described in the Holy FRQFOXVLRQKRZHYHUWKH6XSUHPH&RXUWLQVWHDGIRXQGWKDW Scriptures, embodied in the person of Jesus Christ, and WKHVFKRROVDWLVVXHZHUHQRWLQIDFWSHUYDVLYHO\VHFWDULDQ enabled through the power of the Holy Spirit. DQGIRXQGLWXQQHFHVVDU\WRDGGUHVVWKHSUHFLVHLVVXHEHIRUH WKLV&RXUW6LQFH+XQWWKH6XSUHPH&RXUWKDVQRWDGGUHVVHG Id. In spite of its religious mission, Regent does not have any WKHLVVXH "specific religious requirement for student admissions, and "the lack of such a ‘[Christian] commitment’ does not 0RUHUHFHQWO\LQ-RKQVRQY(FRQRPLF'HYHORSPHQW&RUS negatively impact an applicant’s standing for admission." Id. )GWK&LUWKLV&RXUWFRQVLGHUHGDFDVH at 686. However, the Virginia Supreme Court noted that LQYROYLQJIDFWVVLPLODUWR+XQWVXSUD,Q-RKQVRQDSULYDWH "[a]ll applicants are required to submit a ‘Clergy &DWKROLF VFKRRO DSSOLHG IRU DQG ZDV JUDQWHG DQ LQGXVWULDO Recommendation,’ both as a matter of policy and practice. UHYHQXH ERQG IURP WKH 0LFKLJDQ (FRQRPLF 'HYHORSPHQW Among the questions asked is whether the applicant has &RUSRUDWLRQDQDJHQF\RIWKH6WDWHRI0LFKLJDQ7KLV&RXUW ‘made a meaningful personal commitment to Jesus Christ.’" KHOGWKDWWKHVFKRRODOWKRXJKD5RPDQ&DWKROLFLQVWLWXWLRQ Id. The Virginia Supreme Court in Lynn further remarked: ZDVQRWDSHUYDVLYHO\VHFWDULDQLQVWLWXWLRQ,GDW Although encouraged to do so, students are not %HFDXVHRIWKLVFRQFOXVLRQWKH&RXUWGLGQRWUHVROYHWKH required to attend Regent’s weekly corporate chapel TXHVWLRQRIZKHWKHUWKHJUDQWLQJRIDQLQGXVWULDOUHYHQXHERQG services or participate in any particular religious WR D SHUYDVLYHO\ VHFWDULDQ LQVWLWXWLRQ LV DQ XQFRQVWLWXWLRQDO activities. However, they must have "[p]ersonal goals IRUPRIDLG7KH-RKQVRQ&RXUWGLGQRWHKRZHYHUWKDW consistent with the mission and goals of Regent >,@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 QFLWLQJ 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 ,GDWSDUDOOHOFLWDWLRQVRPLWWHG 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\&HQWHUWKH

&1DWXUHRIWKH$LG Columbia Union Coll. v. Oliver, 254 F.3d 496 (4th Cir. 2001) ("Columbia Union II"). In Columbia Union II, the Fourth /LSVFRPE 8QLYHUVLW\ FRQWHQGV WKDW WKH ERQGV UHSUHVHQW Circuit stated: LQGLUHFWDLGRIWKHW\SHWKH6XSUHPH&RXWXSKHOGLQ:DO]Y 7D[&RPPLVVLRQ867KH:DO]&RXUWKHOG The district court respected fully the majority’s order WKDWDVWDWXWHZKLFKSURYLGHGDWD[H[HPSWLRQIRUUHDOHVWDWH of remand in Columbia Union I. Working through the RZQHG E\ UHOLJLRXV RUJDQL]DWLRQV GLG QRW UHSUHVHQW DQ four factors in this case, the court found that although XQFRQVWLWXWLRQDOJRYHUQPHQWDODWWHPSWWRHVWDEOLVKVSRQVRU Columbia Union had a mandatory worship policy, it RUVXSSRUWUHOLJLRQ,QODQJXDJHSHUWLQHQWWRWKLVDSSHDOWKH applied only to a minority of students. With regard to the 6XSUHPH&RXUWQRWHG second factor, the court held that the evidence submitted by the Commission was insufficient to show that the 7KHJUDQWRIDWD[H[HPSWLRQLVQRWVSRQVRUVKLSVLQFHWKH traditional liberal arts classes were "taught with the JRYHUQPHQW GRHV QRW WUDQVIHU SDUW RI LWV UHYHQXHV WR primary objective of religious indoctrination." The court FKXUFKHVEXWVLPSO\DEVWDLQVIURPGHPDQGLQJWKDWWKH pointed to "affirmative evidence indicating that secular FKXUFKVXSSRUWWKHVWDWH education is the primary goal of" Columbia Union. The ,GDW7KH6XSUHPH&RXUWFRQFOXGHGWKDW³>W@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 'HGXFWLRQV IRU FKDULWDEOH FRQWULEXWLRQV DOORZHG E\ 0LQQHVRWD 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] VXEVWDQWLDOO\ IURP WKH DOORZDQFH RI VXFK GHGXFWLRQV 7KH &RXUW V

KROGLQJ LQ Y 7D[ &RPP Q  86   LQGLFDWHV has been found by a court to be a pervasively sectarian KRZHYHU WKDW WKLV GRHV QRW UHTXLUH WKH FRQFOXVLRQ WKDW VXFK  6WHHOHHWDOY,QGXVWULDO 1RV 1RV 6WHHOHHWDOY,QGXVWULDO  'HY%GHWDO   'HY%GHWDO

Moreover, there are no religious requirements for LQVWLWXWLRQVEHQHILWYHU\VXEVWDQWLDOO\IURPWKHDOORZDQFH´RI membership on the Academy's Board of Trustees. WKLVNLQGRIWD[GHGXFWLRQ,GDWQ7KH&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  'HY%GHWDO   'HY%GHWDO

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[SHQVHV86DWQ)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  'HY%GHWDO   'HY%GHWDO

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  LQWHUQDOFLWDWLRQVRPLWWHG 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  'HY%GHWDO   'HY%GHWDO

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$QQ†G: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\RI1HZ

testimony that Lipscomb instructs the faculty in the Biology H[FOXVLYHO\SULYDWHOHQGHUVRIWKHIXQGV7KHSXUFKDVHURID and Physics Departments to "teach creationism." By ERQGKDVUHFRXUVHIRUUHSD\PHQWDJDLQVW/LSVFRPE8QLYHUVLW\ Lipscomb’s own admission, the religious tenets of the RQO\WKHKROGHURIDERQGKDVQRUHFRXUVHDJDLQVWWKH%RDUG Churches of Christ are designed to permeate every facet of the RU0HWURLQWKHHYHQWRIQRQSD\PHQW1RJRYHUQPHQWIXQGV University, including classroom instruction in subjects that DUHLQYROYHGLQWKHHQWLUHWUDQVDFWLRQ7KHLQWHUHVWSDLGWRWKH are considered non-religious or nonsectarian. ERQGKROGHUVE\/LSVFRPE8QLYHUVLW\LVQRWVXEMHFWWRIHGHUDO VWDWHRUORFDOLQFRPHWD[HV6LQFHWKHERQGVDUHWD[H[HPSW Here, the record shows that Lipscomb satisfies all the /LSVFRPE8QLYHUVLW\UHDSVWKHEHQHILWRIDORZHULQWHUHVWUDWH elements of a sectarian educational institution profile, WKDQWKDWSDLGWRDOHQGHUSD\LQJLQFRPHWD[HVRQWKHLQWHUHVW conclusively demonstrating that religion pervades it to such UHFHLYHG2QO\E\WKHSRWHQWLDOORVVRIWD[UHYHQXHGRHVWKH an extent that "its functions are subsumed in the religious FRQGXLWILQDQFLQJLQYROYHDQ\LPSDFWRQSXEOLFIXQGV mission." Hunt, 413 U.S. at 743. Accordingly, there is no genuine issue of material fact about whether Lipscomb is a ,QLWLDOO\ZHQRWHWKDWDJRYHUQPHQWDOERG\PXVWLVVXHWKH pervasively sectarian educational institution. ERQGV  :KLOH DW ILUVW EOXVK VXFK IDFW ZRXOG LQGLFDWH JRYHUQPHQWDO HQGRUVHPHQW RI UHOLJLRQ WKH UHDVRQ IRU WKH Lipscomb is clearly distinguishable from educational LVVXDQFHRIWKHERQGVE\DJRYHUQPHQWDODJHQF\VWHPVIURP institutions found not to be pervasively sectarian WKHVLPSOHIDFWWKDWWKH,QWHUQDO5HYHQXH&RGHH[FOXGHVIURP LQFRPHWD[DWLRQRQO\LQWHUHVWSDLGRQLQGXVWULDOUHYHQXHERQGV As an educational institution, Lipscomb is clearly LVVXHGDQGDSSURYHGE\DVWDWHRUORFDOJRYHUQPHQWDOXQLW distinguishable from those higher educational institutions that 86& † I  $  6XFK TXDOLI\LQJ ERQGV QHHG QRW the Supreme Court has found not to be pervasively sectarian. ILQDQFH D JRYHUQPHQWDO IXQFWLRQ VXFK DV ZDWHU RU VHZHU For example, in Tilton v. Richardson, 403 U.S. 672 (1971), OLQHVEXWPD\EHLVVXHGWRSURPRWHDYDULHW\RISXUSRVHV the Supreme Court found that a direct federal grant awarded LQFOXGLQJ HFRQRPLF GHYHORSPHQW DQG KLJKHU HGXFDWLRQ pursuant to the Higher Education Facilities Act of 1963 to )XUWKHU 7HQQHVVHH ODZ UHTXLUHV VXFK ERQGV VHUYH WKH four colleges and universities affiliated with the Roman ³IXUWKHUDQFHRIWKHHGXFDWLRQDOSXUSRVHVRIVXFKLQVWLWXWLRQ Catholic Church for the construction of academic facilities LQFOXGLQJEXWQRWOLPLWHGWRFODVVURRPODERUDWRU\KRXVLQJ devoted to secular purposes did not violate the Establishment DGPLQLVWUDWLYHSK\VLFDOHGXFDWLRQDQGPHGLFDOUHVHDUFKDQG Clause, except for the section of the Act that limited federal WUHDWPHQW IDFLOLWLHV´  7HQQ &RGH $QQ ††  interest in the facilities to a period of twenty years because it  $ YLL allowed the unconstitutional contribution of valuable property to a religious institution, and could be "used to promote 7KH IHGHUDO JRYHUQPHQW KDV FRQWLQXRXVO\ SURYLGHG DQ religious interests." 403 U.S. at 683. The colleges in Tilton H[HPSWLRQIRULQWHUHVWRQERQGVLVVXHGE\RURQEHKDOIRI were described in the following terms: VWDWHVDQGORFDOLWLHVVLQFHWKHLQFHSWLRQRIDIHGHUDOLQFRPH WD[LQ7DULII$FWRI3XE/1RFK All four schools are governed by Catholic religious 6WDW$OWKRXJKVWDWHVDQGORFDOLWLHVILUVWWRRNDGYDQWDJH organizations, and the faculties and student bodies at RIWKLVH[FHSWLRQE\LVVXLQJJHQHUDOREOLJDWLRQERQGVWKH\ each are predominantly Catholic. Nevertheless, the ODWHULVVXHGUHYHQXHERQGVWRKHOSILQDQFHSULYDWHEXVLQHVV evidence shows that non-Catholics were admitted as DFWLYLWLHVIRUWKHRVWHQVLEOHSXUSRVHRISURPRWLQJHFRQRPLF students and given faculty appointments. Not one of JURZWK  6WXDUW & -RKQVRQ 0XOWL)DPLO\ +RXVLQJ %RQGV  6WHHOHHWDOY,QGXVWULDO 1RV 1RV 6WHHOHHWDOY,QGXVWULDO  'HY%GHWDO   'HY%GHWDO

&DQWKH7D[&RGH3URYLGHDQ(IILFLHQWDQG(IIHFWLYH/RZ Gospels, The Church, Old Testament, and Defense of the ,QFRPH +RXVLQJ 3URJUDP  9D 7D[ 5HY   Faith. According to Lipscomb, the Bible is the inspired word  FLWDWLRQV RPLWWHG &RQJUHVV SURYLGHG IRU DQ of God, and students are encouraged to apply Biblical H[HPSWLRQIURPLQFRPHWD[DWLRQIRULQGXVWULDOUHYHQXHERQGV principles in conducting the affairs of their personal and LVVXHGLQFRQQHFWLRQZLWKDSURMHFWLQWHQGHGWREHQHILWDORFDO professional lives. Students are also required to pass Bible HFRQRP\  7KH ,QWHUQDO 5HYHQXH 6HUYLFH H[SOLFLWO\ courses, and the failure to do so results in being placed on OHJLWLPL]HGWKLVSUDFWLFHLQ5HY5XO "Bible probation," which could lead to expulsion. From 1988 &%6XFKERQGVKDYHEHHQW\SLFDOO\LVVXHGE\D to 1992, approximately 100 students were placed on Bible JRYHUQPHQWDODXWKRULW\HYHQWKRXJKVXFKDXWKRULW\GRHVQRW probation. In addition, students are required to attend chapel DFWXDOO\ ERUURZ WKH IXQGV QRU LV VXFK DXWKRULW\ OLDEOH IRU every school day, and the failure to do so may lead to being UHSD\PHQW  ³$ UHYHQXH ERQG LV UHSDLG VROHO\ IURP WKH placed on "chapel probation." UHYHQXHV JHQHUDWHG E\ WKH IDFLOLWLHV FRQVWUXFWHG ZLWK ERQG SURFHHGV,QWKHLVVXDQFHRIWKLVW\SHRIERQGWKHSROLWLFDO Fourth, attendance at chapel and the study of the Bible at VXEGLYLVLRQDFWVVROHO\DVDFRQGXLWIRULVVXLQJWKHERQGV,W Lipscomb are an "integral part" of the religious mission of the KDV QR REOLJDWLRQ WR XVH LWV WD[ UHYHQXHV WR ILQDQFH DQ\ Churches of Christ. This is made clear repeatedly throughout VKRUWIDOO´=LPPHUPDQ/LPLWLQJWKH*URZWKRI7D[([HPSW Lipscomb’s Faculty and Student Handbooks, as well as its ,QGXVWULDO 'HYHORSPHQW %RQGV $Q (FRQRPLF (YDOXDWLRQV university catalogues. &RQJ5HVHDUFK6HUY5HS1R( Fifth, religious indoctrination is a "substantial purpose" at ,QDGGLWLRQE\UHTXLULQJORFDOJRYHUQPHQWDODXWKRULWLHVWR Lipscomb. As set forth in Lipscomb’s corporate charter and LVVXH WD[H[HPSW LQGXVWULDO UHYHQXH ERQGV &RQJUHVV bylaws of the Board of Directors, "[t]he corporation was GHOHJDWHGWRVXFKJRYHUQPHQWDOXQLWVDQHOHPHQWRIFRQWURO organized for the purpose of teaching the word of God and the RYHUORFDOHFRQRPLFGHYHORSPHQW7KHUHYHQXHERQGVVHUYH various branches of the useful knowledge, commonly taught DVDPHDQVRIILQDQFLQJ ORFDOSUHIHUHQFHV6HH&OD\WRQ3 in institutions of learning for the following general purpose: *LOOHWWH)LVFDO)HGHUDOLVPDQGWKH8VHRI0XQLFLSDO%RQG . . . the support of public worship, the building of churches 3URFHHGV1<8/5HYGLVFXVVLQJ6HFWLRQ and chapels and the maintenance of missionary undertakings." RIWKH,QWHUQDO5HYHQXH&RGHZKLFKSURYLGHVDIHGHUDO Moreover, as the district court noted, "[t]he land on which the WD[ H[HPSWLRQ IRU LQWHUHVW HDUQHG RQ VWDWH DQG PXQLFLSDO construction projects funded by the bond proceeds were undertaken is subject to restrictive covenants that require that the property be used exclusively to further the religious mission of the institution so long as the property is owned by Lipscomb." Steele v. Indus. Dev. Bd. of the Metro. Gov. of Nashville and Davidson County, 117 F.Supp.2d 693, 710  (M.D. Tenn. 2000). 7KH 6HUYLFH FODVVLILHG DV WD[ H[HPSW WKRVH ERQGV LVVXHG E\ D

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QRWZLWKVWDQGLQJ WKH SXUSRVH IRU ZKLFK WKH\ ZHUH LVVXHG RU WKH IDFW WKDW Sixth, Lipscomb imposes religious restrictions on how and WKH SURPLVH WR SD\ LV OLPLWHG WR WKH UHYHQXH WR EH GHULYHG IURP OHDVLQJ WKH what the faculty teach. As Lipscomb acknowledges, it does SURSHUW\ WR EH DFTXLUHG    ,W LV QRW QHFHVVDU\    WKDW WKH REOLJDWLRQ EH D JHQHUDO RQH SOHGJLQJ WKH JHQHUDO FUHGLW RI WKH PXQLFLSDOLW\ RU WKH XVH RI not subscribe to the AAUP’s Statement of Principles on LWV WD[LQJ SRZHU Academic Freedom. Specifically, there was unrebutted  6WHHOHHWDOY,QGXVWULDO 1RV 1RV 6WHHOHHWDOY,QGXVWULDO  'HY%GHWDO   'HY%GHWDO

Lipscomb fits the profile of a pervasively sectarian ERQGV)RUH[DPSOHDORFDOJRYHUQPHQWPLJKWFRQFOXGH educational institution WKDW WKH LVVXDQFH RI DQ LQGXVWULDO UHYHQXH ERQG WR D QHZ EXVLQHVVFRXOGJLYHDFRPSHWLWLYHGLVDGYDQWDJHWRDQH[LVWLQJ Viewing the undisputed facts, the district court properly EXVLQHVVZKLFKKDGQRWUHFHLYHGVXFKFRQGXLWILQDQFLQJDQG concluded that Lipscomb is, as a matter of law, a pervasively UHVXOWLQHFRQRPLFGLVSODFHPHQWUDWKHUWKDQGHYHORSPHQW sectarian educational institution. First, the record indicates that Lipscomb places religious restrictions on admission, and ,WLVFOHDUIURPWKHUHFRUGWKDWLQGXVWULDOUHYHQXHERQGVDUH that more than 70% of the student body belongs to the LVVXHGWRDZLGHYDULHW\RIEXVLQHVVHVVFKRROVXQLYHUVLWLHV Churches of Christ. Lipscomb also places religious FKDULWLHVDQGRWKHURUJDQL]DWLRQV,WLVZLWKRXWTXHVWLRQWKDW restrictions on faculty and staff appointments, requiring that D UHOLJLRXV RUJDQL]DWLRQ PD\ UHFHLYH ³JHQHUDO JRYHUQPHQW all personnel, with limited exceptions, be members in good EHQHILWV´FRQVLVWHQWZLWKWKH(VWDEOLVKPHQW&ODXVH=REUHVW standing of the Churches of Christ. Specifically, all members Y&DWDOLQD)RRWKLOOV6FK'LVW86$VWKH of Lipscomb’s faculty and staff are expected to attend daily 6XSUHPH&RXUWQRWHGLQ:LGPHUY9LQFHQW86 chapel and adhere to church doctrines. Further, faculty    ³,I WKH (VWDEOLVKPHQW &ODXVH EDUUHG WKH members are contractually bound to promote the beliefs of the H[WHQVLRQRIJHQHUDOEHQHILWV WRUHOLJLRXVJURXSVµDFKXUFK Churches of Christ, both in and out of the classroom, and if FRXOGQRWEHSURWHFWHGE\WKHSROLFHDQGILUHGHSDUWPHQWVRU any member leaves the church, it is an immediate ground for KDYHLWVSXEOLFVLGHZDONNHSWLQUHSDLU¶´FLWLQJ5RHPHUY%G termination of employment. As noted by the district court, RI3XE:RUNV86:HFRQFOXGHWKDW Lipscomb also reserves the right under Title VII of the Civil WKH LVVXDQFH RI WD[ H[HPSW ERQGV RQ D QHXWUDO EDVLV LV WKH Rights Act of 1964 (as amended) to discriminate, "where it is FRQIHUHQFHRIDJHQHUDOO\DYDLODEOHJRYHUQPHQWDOEHQHILW necessitated by the specific religious tenets held by the institution." Second, Lipscomb enforces obedience to its religious dogma, directing that the Bible be taught "every school day to every student enrolled . . . by teachers who are sound in the faith and faithful in their lives to its sacred truths." According  $FFRUGLQJ WR WKH 6HQDWH &RPPLWWHH RQ )LQDQFH 6 5HS 1R  to Lipscomb, its "supreme purpose" is "to teach the Bible as WK &RQJ G 6HVV   WKH SXEOLF QRWLFH DQG DSSURYDO the revealed will of God to man and as the only and sufficient UHTXLUHPHQWV ZHUH HQDFWHG WR KHOS HOLPLQDWH LQDSSURSULDWH XVHV RI WD[ rule of faith and practice, and to train those who will attend in H[HPSW ILQDQFLQJ DQG WR KHOS UHVWRUH WKH EHQHILW RI WD[H[HPSW ILQDQFLQJ a pure Bible Christianity." IRU WUDGLWLRQDO JRYHUQPHQWDO SXUSRVHV :KLOH DFNQRZOHGJLQJ WKDW VWDWH DQG ORFDO JRYHUQPHQWV DUH EHVW VXLWHG WR GHWHUPLQH WKH DSSURSULDWH XVHV RI LQGXVWULDO GHYHORSPHQWV ERQGV WKH FRPPLWWHH FRQFOXGHG WKDW LQGXVWULDO Third, Lipscomb requires its students to participate in daily GHYHORSPHQW ERQGV VHUYH D OHJLWLPDWH SXUSRVHV RQO\ LI D WKH DIIHFWHG Bible study and attendance at chapel. According to SXEOLF KDV DQ RSSRUWXQLW\ WR FRPPHQW RQ WKH XVH RI WD[H[HPSW ILQDQFLQJ Lipscomb, "[t]he university has no authority to suspend [the IRU SDUWLFXODU IDFLOLWLHV DQG E DIWHU WKDW LQSXW WKH HOHFWHG UHSUHVHQWDWLYHV daily Bible] requirement for any student." As the district RI WKH JRYHUQPHQWDO XQLW GHWHUPLQH WKDW WKHUH ZLOO EH VXEVWDQWLDO SXEOLF court found, all students must take at least one Bible class EHQHILW IURP LVVXLQJ WKH ERQGV +5 &RQI 5HS 1R  WK &RQJ G 6HVV    &%  %DVHG RQ WKLV OHJLVODWLYH KLVWRU\ every day of each semester and are required to take at least 0HWUR KDV FOHDUO\ IXOILOOHG LWV REOLJDWLRQ XQGHU  I WR DSSURYH D ERQG one course from each of the following four categories: The LVVXH WKDW PHHWV WKH SXEOLF FULWHULD  6WHHOHHWDOY,QGXVWULDO 1RV 1RV 6WHHOHHWDOY,QGXVWULDO  'HY%GHWDO   'HY%GHWDO

(3ULPDU\3XUSRVHDQG(IIHFWRIWKH3URJUDP Circuit identified four "general areas of inquiry" in determining whether a school is pervasively sectarian: ,QKHUFRQFXUUHQFHLQ=HOPDQ-XVWLFH2¶&RQQRUUHDIILUPHG "(1) does the college mandate religious worship; (2) to what WKDWWKHPRGLILHG/HPRQ7HVWLVVWLOODFHQWUDOWRROLQDQDO\VLV extent do religious influences dominate the academic RI(VWDEOLVKPHQW&ODXVHFDVHVQRWLQJ curriculum, (3) how much do religious preferences shape the college’s faculty hiring and student admission processes, and $VRULJLQDOO\IRUPXODWHGDVWDWXWHSDVVHGWKLVWHVWRQO\LI (4) to what degree does the college enjoy ‘institutional LWKDGDVHFXODUOHJLVODWLYHSXUSRVHLILWVSULQFLSDORU autonomy’ apart from the church with which it is affiliated." SULPDU\ HIIHFW ZDV RQH WKDW QHLWKHU DGYDQFH>G@ 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 86DWFRQFXUULQJRSLQLRQ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  'HY%GHWDO   'HY%GHWDO

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  'HY%GHWDO   'HY%GHWDO

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’ &/$< &LUFXLW -XGJH GLVVHQWLQJ  %HFDXVH 'DYLG is no longer a factor to be considered by the courts in these /LSVFRPE 8QLYHUVLW\ ³/LSVFRPE´ LV LQGLVSXWDEO\ D kinds of cases." Lipscomb’s Br. at 7. However, as the ³SHUYDVLYHO\ VHFWDULDQ´ HGXFDWLRQDO LQVWLWXWLRQ DQG EHFDXVH majority opinion recognizes, the pervasively sectarian test has WKHORZLQWHUHVWORDQWR/LSVFRPEWKURXJKWKHLVVXDQFHRIWKH not been abandoned. In Johnson v. Econ. Dev. Corp. of WD[H[HPSWERQGVE\WKH,QGXVWULDO'HYHORSPHQW%RDUG³WKH County of Oakland, 241 F.3d 501, 510 n. 2 (6th Cir. 2001), %RDUG´DPRXQWHGWRDGLUHFWHFRQRPLFEHQHILWLQYLRODWLRQRI this Court pointed out: WKH(VWDEOLVKPHQW&ODXVHRIWKH)LUVW$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  6WHHOHHWDOY,QGXVWULDO 1RV 1RV 6WHHOHHWDOY,QGXVWULDO  'HY%GHWDO   'HY%GHWDO

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  6WHHOHHWDOY,QGXVWULDO 1RV 1RV 6WHHOHHWDOY,QGXVWULDO  'HY%GHWDO   'HY%GHWDO

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  6WHHOHHWDOY,QGXVWULDO 1RV 1RV 6WHHOHHWDOY,QGXVWULDO  'HY%GHWDO   'HY%GHWDO

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    6WHHOHHWDOY,QGXVWULDO 1RV 1RV 6WHHOHHWDOY,QGXVWULDO  'HY%GHWDO   'HY%GHWDO

These ideas about the central importance of the Bible are HTXLSDQHZOLEUDU\UHQRYDWHDQGFRQYHUWWKHROGOLEUDU\LQWR echoed throughout Lipscomb’s catalogues. For example, in DGPLQLVWUDWLYHRIILFHVFRQVWUXFWDQLQWUDPXUDOEXLOGLQJRU 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  'HY%GHWDO   'HY%GHWDO

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).  6WHHOHHWDOY,QGXVWULDO 1RV 1RV 6WHHOHHWDOY,QGXVWULDO  'HY%GHWDO   'HY%GHWDO

(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  6WHHOHHWDOY,QGXVWULDO 1RV 1RV 6WHHOHHWDOY,QGXVWULDO  'HY%GHWDO   'HY%GHWDO

-$ 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\PHHWLQJVZRPHQKDYHQR 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  6WHHOHHWDOY,QGXVWULDO 1RV 1RV 6WHHOHHWDOY,QGXVWULDO  'HY%GHWDO   'HY%GHWDO

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 YDULRXVSHUVRQDOTXHVWLRQVRQHRIWKHPEHLQJWKHIDFWWKDWP\ WKH LQVWLWXWLRQ KXVEDQGDQG,DWWKDWWLPHZHUHVHSDUDWHG´-$DW E 7HDFKHUV DUH HQWLWOHG WR IUHHGRP LQ WKH FODVVURRP LQ GLVFXVVLQJ 'U 6LQFODLU DOVR WHVWLILHG WKDW WKH FKDLUPDQ RI WKH (QJOLVK WKHLU VXEMHFW EXW WKH\ VKRXOG EH FDUHIXO QRW WR LQWURGXFH LQWR 'HSDUWPHQW LQIRUPHG KHU ZKHQ VKH ZDV KLUHG WKDW ³WKHUH WKHLU WHDFKLQJ FRQWURYHUVLDO PDWWHU ZKLFK KDV QR UHODWLRQ WR WKHLU PLJKW EH VRPH SUREOHPV ZLWK WKH UHTXLUHPHQWV RI WKH VXEMHFW /LPLWDWLRQV RI DFDGHPLF IUHHGRP EHFDXVH RI UHOLJLRXV XQLYHUVLW\´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