Montana Supreme Court

Five members of Montana's Supreme Court and two District Court judges sitting in for justices who recused themselves hear a case in April 2017.

The Montana Supreme Court will hear arguments Friday on whether tax credit scholarships can support religious schools in a case that's drawing national interest from high-profile groups.

The case pits a group of Flathead County parents, who want public financial help for their children to attend private Christian school, against the Montana Department of Revenue.

According to court documents, plaintiffs want access to a state scholarship program supported by tax credits, and the three Kalispell mothers argue an agency rule that prohibits use of the benefit in religious schools is discriminatory.

However, the state agency defined "qualified education providers," and it excludes religious schools noting the Montana Constitution's prohibition of aid for sectarian purposes.

The national organizations that have filed "friends of the court" briefs include the American Civil Liberties Union and the Becket Fund for Religious Liberty.

The Becket Fund gained a reputation as a legal force for religious liberty when it represented the craft store Hobby Lobby before the U.S. Supreme Court. In that case, justices ruled religious store owners do not have to provide workers contraception and found an Affordable Care Act mandate violated the Religious Freedom Restoration Act.

The Montana Supreme Court will hear arguments on the tax credit case on Friday, April 6, at the University of Montana's Dennison Theatre. UM's Alexander Blewett III School of Law professors Pippa Browde and Anthony Johnstone will introduce the case starting at 9 a.m., and the public is invited.

"The question before the Montana Supreme Court is whether the Montana Constitution prohibits tax credits for donations to scholarship organizations that could ultimately go toward religious schools," said a news release from UM about the oral argument.

The case is called Kendra Espinoza, Jeri Ellen Anderson and Jaime Schaefer v. Montana Department of Revenue and Mike Kadas, agency director.


In late 2015, the Flathead County parents sued the Montana Department of Revenue, arguing in part that the state agency should not exclude religious schools from a scholarship program supported by a tax credit. The plaintiffs said the exclusion was unconstitutional under the the Religion and Equal Protection Clauses of both the Montana and U.S. Constitutions.

The Department of Revenue had defined qualified schools based partly on Article X, Section 6 of the Montana Constitution, which prohibits aid to sectarian schools, including "any direct or indirect appropriations."

In May 2017, the District Court ruled in favor of the plaintiff and found the Department of Revenue incorrectly interpreted Article V, Section 11, and Article X, Section 6 of the Montana Constitution.

"Both articles of the Montana Constitution prohibit appropriations that aid religious schools, but they are silent concerning tax credits," the court said.

The court said an "appropriation" refers only to the Legislature's authority to spend money from its treasury, and it said tax credits "simply do not involve the expenditure of money that the state has in its treasury."

The Department of Revenue appealed the ruling. It described the tax credit as an "unprecedented one-to-one tax expenditure of public monies to Montana's private schools." In part, it noted the court failed to address the agency's concerns that without its exclusion, "substantially all" providers would be religious schools.

"These schools are predominantly religious schools, which are constitutionally ineligible for any direct or indirect state aid," the department said in a brief.

The parent plaintiffs, though, argued a poll showed the Legislature intended to include religious schools in the scholarship program. They said the state agency is not implementing the program as lawmakers intended and is unlawfully excluding needy parents who want to apply for scholarships and use them at religious schools. 

"Parents such as Plaintiff mothers cannot apply for program scholarships to send their children to religious private schools. Only families choosing nonreligious private schools can apply," said the plaintiffs.

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