Law Professors Enter Prop. 8 Fray on Church's Tax-Exempt Status
San Diego Union Tribune
By Michael Gardner
October 30, 2008

SACRAMENTO – Whether disapproving churches could be forced to choose between providing services to gay couples or losing their tax-exempt status is one of the questions swirling around Proposition 8, the Nov. 4 ballot measure that would ban same-sex marriage.

Advertisement In its May ruling legalizing same-sex marriage, the state Supreme Court made clear that it did not intend for the decision to be interpreted as interfering with a church's right to determine who it marries.

Yesterday, 59 California law professors released a one-page position paper making their case that the state and federal constitutions provide ironclad protections for churches.

“No church's tax-exempt status will be affected by its decisions about whether to solemnize marriages between same-sex couples,” they wrote.

Significantly, those signing the letter and other legal experts also argue that nothing about Proposition 8, win or lose, will change existing tax law because the state bars discrimination based on marital status or sexual orientation.

“If they were already prohibited from discriminatory behavior, they will still be prohibited” regardless of the election outcome, said Vikram Amar, a law professor at the University of California Davis.

Online: For the list of law professors and their statement on Proposition 8, go to uniontrib.com/more/documents However, supporters of Proposition 8 warn of the fallout if voters reject the ban on same-sex marriage, including sharp restrictions on commercial uses of church property usually open to the public and threats to tax exemptions if they refuse to comply.

“They (opponents of Proposition 8) are desperately trying to downplay this major shift in the law,” said Andrew Pugno, a Folsom attorney advising the Yes on 8 campaign.

Supporters of Proposition 8 point to New Jersey, where a church lost part of its tax exemption because it refused to rent out a publicly used pavilion, located away from the church proper, for a same-sex commitment ceremony. Same-sex marriage is not legal in New Jersey.

California's high court focused on marriage and appeared to anticipate potential conflicts with churches, offering language that could establish precedent if complaints are brought by same-sex couples who were refused marriage at a given church.

The court ruled that “affording same-sex couples the opportunity to obtain the designation of marriage will not impinge upon the religious freedom of any religious organization, official, or any other person; no religion will be required to change its religious policies or practices with regard to same-sex couples; and no religious officiant will be required to solemnize a marriage in contravention of his or her religious beliefs.”

Some church leaders are not convinced.

Phillip Goudeaux, pastor of Calvary Christian Center in Sacramento, noted that four judges overturned the results of the 2000 statutory ban on same-sex marriage.

“Everything is subject to change,” Goudeaux said.

The risk, some suggest, applies only if a church discriminates as part of its commercial ventures, such as renting property or charging fees for day care.

“The farther away you get from the core of what a church does and it looks more like a business, then it becomes subject to California's anti-discrimination law,” said Brad Sears, executive director of the Williams Institute, which focuses on sexual-orientation law and public policy at UCLA.

The Unruh Civil Rights Act, the bedrock of California's civil rights law, states: “All persons within the jurisdiction of this state are free and equal, and no matter what their sex, race, color, religion, ancestry, national origin, disability, medical condition, marital status, or sexual orientation, are entitled to the full and equal accommodations, advantages, facilities, privileges, or services in all business establishments of every kind whatsoever.”

But Pugno, the Yes on 8 attorney, says that a church – or individuals – should not be forced to abandon moral principles. He points to the New Jersey case, where the Methodist Ocean Grove Camp Meeting Association lost a share of its tax exemption for rejecting the ceremony.

“The legal justification is the religious freedom of the property owners to see their property used in ways that are consistent with their beliefs,” Pugno said.

No California church has lost its tax exemption on those grounds, according to state officials.

A potentially landmark guide is a case that focused on racial discrimination allegations at Bob Jones University, which had denied admission to interracial couples. In 1983, the U.S. Supreme Court held 8-1 that charities and nonprofits cannot maintain an IRS tax exemption if their practices run contrary to “established public policy.”

California's marital-status and sexual-orientation protections could be construed as established public policy, according to some legal experts.

“Although the high court did not go beyond race in the text of its opinion, the ruling could be interpreted as barring charities from discriminating based on sexual orientation – at least in an environment in which such discrimination violates established public policy,” said David Brennen of the University of Georgia School of Law, who specializes in nonprofit tax law.