COMMITTEE FOR PUBLIC EDUCATION v. NYQUIST
New York enacted Chapter 414 of its Education and Tax Laws, which created aid programs for nonpublic elementary and secondary schools. These amendments included Section 1, which provided a grant for the maintenance and repair of schools that served many low-income students; Section 2, which provided tuition reimbursement for low-income parents; and Sections 3, 4, and 5, which provided tax relief for parents who did not qualify for tuition reimbursement. After the institution of these amendments, the Campaign for Public Education and Religious Liberty challenged the amendments in United States District Court for the Southern District of New York, alleging that these amendments violated the Establishment Clause of the First Amendment. The District Court held that Sections 1 and 2 violated the Establishment Clause, but not Sections 3, 4, and 5.
Did Sections 1-5 of Chapter 414 of New York's Education and Tax Laws violate the Establishment Clause of the First Amendment?
Legal provision: Establishment of Religion
Yes to all sections. In a 6-3 decision, the Court affirmed the District Court on maintenance grant and tuition reimbursement and reversed the District Court on income tax relief. The Court cited earlier decisions that established that under the Establishment Clause, a law must "first, reflect a clearly secular legislative purpose, second, must have a primary effect that neither advances nor inhibits religion, and third, must avoid excessive government entanglement with religion." Writing for the majority, Justice Lewis F. Powell, Jr. acknowledged that New York's interest in creating a positive educational environment was a clearly secular purpose. Section 1, however, did not limit the use of the grants towards maintaining facilities used for secular purposes. This distinguished Section 1 from other aid programs approved by the Court in the past in Board of Education v. Allen and Tilton v. Richardson. Since "all or practically all" of the schools that qualified were affiliated with the Roman Catholic Church, the maintenance grants would "subsidize and advance the religious mission of sectarian schools" in violation of the Establishment Clause. Chief Justice Warren E. Burger and Justice William H. Rehnquist concurred in this part of the judgment. The Court also struck down Section 2, as the tuition reimbursements did not "guarantee the separation between secular and religious educational functions." While the Court recognized the possibility that reimbursement money would not end up in the hands of religious schools, the grants would attempt to "enhance the opportunities of the poor to choose between public and nonpublic education," which would advance religion. Lastly, the Court reversed the District Court with regard to Sections 3, 4, and 5, ruling that effect of tax relief was similar to that of the tuition reimbursement and therefore unconstitutional. The Court in Walz v. Tax Commission upheld New York's property tax exemptions for religious organizations. However, the tax exemption was designed to prevent government oppression of religion through taxation, not for the promotion of religion.
Argument of Leo Pfeffer
Chief Justice Warren E. Burger: We'll hear arguments next in consolidated cases 72-694, 753, 791, and 929.
Mr. Pfeffer you may proceed whenever you are ready.
Mr. Leo Pfeffer: Mr. Chief Justice, may it please the Court.
This is a suit challenging the constitutionality of the three parts of Chapter 414 of New York Laws, 1972.
That Act consists of five parts.
Part one provides public funds for the maintenance and repair of non-public schools.
Part two, provides funds for tuition in such schools, of parents whose income does not exceed $5,000 a year.
Part three provides a tax credits to parents, children taking such schools whose income exceeds $5,000 a year.
Part four provides public funds to public school districts Impact Aid funds whose enrollment increases by reason of the closing down of nonpublic schools in that district, and part five empowers the public schools districts in those areas to purchase unused or no longer used nonpublic schools.
The suit challenges only the first three parts under the religion clauses of the First Amendment.
The District Court held unanimously that part one and part two are unconstitutional.
By a divided vote, with Judge Hays dissenting, it held constitutional the third part, the tax credit part and also held that, that part was severable from the rest of the statute.
Judge Hays dissented on both parts, now taking each of these parts to seriatim, the maintenance and repair part, the statute is quite broad in what constitutes maintenance and repair, indeed it's open ended.
It defines maintenance and repair as the provision of heat, light, water, ventilation and sanitary facilities; cleaning, janitorial and custodial services; snow removal; necessary upkeep and renovation of buildings, grounds and equipment; fire and accident protection; and such other items as the commissioner, as the state Commissioner of Education may deem necessary to ensure the health, welfare and safety of enrolled pupils.
Indeed I think it is fair to say that except for teacher salaries, this statute permits practically the state and directs the state to pick up the bill for everything in those schools.
Now, the only qualifications under the statute are that the schools be located in low income areas.
The amount given to the schools for that purpose is $30 per pupil in attendance and an additional $10.00 if the school is more than 25 years old.
Now, in Lemon against Kurtzman and Earley against DiCenso, this Court in 1971 declared unconstitutional the state laws in Pennsylvania and Rhode Island which appropriated public funds to pay for the secular teaching in religious schools.
On the same day, the Court decided these cases, it decided Tilton against Richardson which upheld on its face, not necessarily as applied, indeed quite clearly not as applied, a Federal statute which appropriated funds to pay half the cost of constructing facilities, colleges.
Now, in Tilton against Richardson, the plurality opinion, there was no court opinion, distinguished the Federal statute, the add from the statutes in the Pennsylvania and Rhode Island cases.
The Court said, in the first place, the federal statute deals with colleges and universities, and there was a rare latitude given by the Establishment Clause, under in such circumstances, because the students are mature, they can resist pressure by the teachers, sectarian pressure in other reasons and therefore the limits of governmental action are somewhat broader, are broader than those in elementary and secondary schools.
Secondly, the Court pointed out that we had there a one-time grant in each of those cases.
The money is given to that state whereas in the DiCenso and Lemon cases, there was ongoing payments each year, therefore there was a greater area of governmental involvement.
Finally, the Court pointed out that in the federal grant, the Tilton grant, the statute specifically forbade the use of any of those facilities partly financed with public funds to be used for religious purposes and indeed in that case, the Court held unconstitutional by unanimously that part of the federal statute which restricted, which removed this limitation after 20 years.
After 20 years under the statute, those federally financed facilities could be used for religious instruction; the Court said this is unconstitutional.
No funds which come from governmental body maybe used to finance any facility used in whole or in part for religious instruction or worship.
Now, in the present case, the statute applies to elementary and secondary schools not to colleges.
Moreover it is not a one-time-grant, but it's -- you have to renew it each year, and perhaps above all, the statute does not forbid the use of the facilities so financed governmental funds for religious or sectarian purposes.
Chief Justice Warren E. Burger: You are speaking now of part one aspect?
Mr. Leo Pfeffer: Part one, part one.
The same rooms which are financed, whose lighting, whose ventilation whose upkeep, whose renovation, is financed with state funds are used for sectarian instruction and religious worship.
If that was a chapel in school as many of the schools to have chapels, that chapel too is part of the cost of maintenance and repair borne by the state.
The statute provides that only 50% of the average state cost of maintenance and repair of public schools maybe appropriated towards these schools, and in no case more than 100 % of money is actually used for these purposes in the parochial schools maybe used.
But there is no distinction within the statute between those parts of the bill indeed it's questionable whether it could be, but those parts of building used for religious purposes and those for sectarian purposes.
Now I do not believe.
And in fact as I read the briefs, there is I believe an implicit admission that if this statute applied to all nonpublic schools, it would clearly be unconstitutional.
I don't see how it can be denied.
There was an effort to justify the statute on the police power of the state to provide for safety and health of students.
While the police power has to be exercised within the restrictions of the First Amendment.
In Flast against Cohen, this Court held that there is an express provision in the constitution, the First Amendment forbidding governmental financing of parochial schools.
I do not know of any case in which a court has held that where there is an express provision in the constitution that can't be transgressed under the police power.
The police power of the state is inherent.
It is used to -- the word police, it's origin is the use of security and safety for people, to arrest criminals or those who are charged with crime and to try them, convict them, and punish them, but that doesn't mean that it's the police power.
A state can't violate an express prohibition against double jeopardy let us say or trial without jury or trial without counsel.
Surely the police -- the public has an interest, the state has an interest in the education of children, but it must be exercised in such way that it does not follow a specific prohibition of the Bill of Rights.
No matter how wise, no matter how effective a trial without jury, or double jeopardy, or trial without counsel would be in preventing crimes speaks, that cannot stand, that cannot justify a specific prohibition in the constitution in the Bill of Rights.
And, in fact, in Cole the whole base of the decision was that the statute clause is a specific prohibition, the first prohibition in the Bill of Rights against a financing of the operations of parochial schools.
The state seems to, also indeed clearly bases its position on this, in this part that this statute is limited to schools in low-income areas.
Again, I know of no decision of any Court holding that to be a critical, or relevant constitutional question, where the question is Equal Protection.
If the state chooses a certain class as beneficiaries of its action and excludes other classes as for example, if the state provides free counsel in criminal case which indeed it must, to poor people but not to wealthy people or provide free access to the divorce cases, indeed it must for poor people not to wealthy people or other cases it does not provides the transcripts of criminal trial to put but not the wealthy people.
Justice Potter Stewart: To poor people as to indigents.
Mr. Leo Pfeffer: Indigents, the indigents.
If the state -- then quite clearly this would not -- this is a rational classification not quite like the Equal Protection but the state could constitutionally provide free access with divorce courts, to faculty courts, to free transcripts, to public defense service, to all, to the indeed, it does in public schools.
Public schools are open to everybody, the wealthiest as well as the most poor, and it is not a violation of Equal Protection because of the reasonable classification whether, if the state chooses one alternative free for all or the other type of free only for the poor, the indigent.
But that never has been used to say that the state can violate an express provision of the Bill of Rights where individual who are involved where they cannot violate it, where the (Inaudible) to it.
So, it seems to me that the first -- the unanimous decision of the court below is entirely correct, that it is a violation of the Establishment Clause for the state to provide funds for the maintenance and repair of schools which are used in part at least for religious education or religious question.
The only case which can remotely justify this statute and very remotely, is the Everson case in which the Court upheld the constitutionality of paying, reimbursing parents for the expenses of sending their children on public bus to parochial schools.
Mr. Justice Black for majority of the Court stated that the purpose of this law is to protect the children from the hazards of the road.
Well, we do not deny, we cannot deny because the of prior decision of this Court which seem to take a position that you cannot go behind what the legislative state in its declaration of purposes.
Therefore we must assume that the purposes of this statute the same, but the effect is probably different, you do not teach religion or practice religion on the bus.
If you did, if a private owned bus, in Everson it was a publicly owned bus, system parents got, paid back for the money which they paid for transportation of public bus but if you did under McCollum against Board of Education, going way back to 1948 which held that no premises publicly owned, publicly financed can be used for religious teaching or religious worship even for as much as a half an hour or an hour a week.
If it does that, it is unconstitutional, that is what the Court held in McCollum and of course it held the same thing in Engel against Vitale, the prayer case, in Abington Township involving Bible reading and in Lemon against Kurtzman.
So we believe that this part of the statute, part one, was quite properly held unconstitutional by unanimous vote of the District Court.
Part two deals with tuition payments.
The statute provides that up to 50 % of the tuition of the -- no, I believe it does have -- but the basic provision is that $50.00 is paid per child for the tuition up to no more than the tuition actually is -- for the tuition paid for enrollment in nonpublic schools.
The question of tuition grants is not a new one, unlike the maintenance and repair and tax credits which are quite new which appear to be a recent.
Tuition grants has a means of avoiding constitutional limitations goes back at least a century.
It has been challenged in the Court in three different contexts.
First, is a violation of state constitutional provisions against financing parochial schools.
Second, under the Establishment clause of the First Amendment and third under the Equal Protection clause of the Fourteenth Amendment in a racial segregation context, a decision growing out of state appropriations of public funds to pay for the tuition of pupils in racial segregated schools.
Now, my own research and I am not volunteering that it is an exhaustive, indeed as I have indicated a moment, I did overlooked one case fortunately which would support to my position not oppose, but the research I have done has disclosed not a single decision and there were many, many which considered this question, not a single decision holding that there was a constitutional difference between a direct grant of public funds to religious schools and paying whole or part of the tuition of children attending those schools.
The cases -- some of the cases there are many others, supporting my position are in my brief, both on the -- under the state constitutions Establishment Clause and the Equal Protection Clause.
In the (Inaudible) cases decided both before and after the Lemon, DiCenso cases, there were three, I point out three in my brief, there is actually a fourth one, I must, I say overlooked things, I argued the case but it slipped my memory.
There were four cases in which the US district courts, in each case a three-judge Court passed upon the question.
One was Wolman against Essex in Ohio which this Court affirmed without argument.
The other is this case, the third is the case which will be argued day after this one, Lemon against Kurtzman.
The fourth which I did not cite in my brief as I said which I slipped my memory is Lemon against Sloan, where -- I mean it's Nebraska against Missouri, Nebraska against Missouri where District Court in Missouri was faced with a challenge by parents of children in parochial schools to the state constitution and the state practice of excluding parochial schools from governmental financing.
The parents claimed that this is a violation of religious freedom and Equal Protection.
The suit was started before the decision in Lemon against DiCenso.
Justice Potter Stewart: Those cases at least -- the ones I am familiar with, that is the Ohio case and the Pennsylvania case to be argued following this group of cases, those have provided various assistance across the board to parents whose children to go to the nonpublic schools, this one is directed to impoverish families, isn't it right?
Mr. Leo Pfeffer: May I just address myself to that.
Justice Potter Stewart: Am I wrong about that?
Mr. Leo Pfeffer: Well I think you are right -- technically you are right and to some extent this is what the state of New York contends, as distinguishes them, but actually it's only technically right because Chapter 414 is a single package.
It takes care of children, parents of children with incomes under $5,000 through a tuition grant.
Justice Potter Stewart: Right.
Mr. Leo Pfeffer: It takes care of children, or parents of children with incomes over $5,000.00 through a tax credit.
Children over --
Justice Potter Stewart: Well that's part three.
I remember that --
Mr. Leo Pfeffer: That's part --
Justice Potter Stewart: You are talking now about part two?
Mr. Leo Pfeffer: Yes, but as I say this is one single fact and --
Justice Potter Stewart: Well that's another question in this case whether or not it's severable, which you haven't come to that yet either.
I am just directing myself to part two.
Mr. Leo Pfeffer: Yes, part two if it were -- if it could be severed from the rest is applied to parents of children with incomes not more than $5,000.
Justice Potter Stewart: And in that respect, this case is different from the other three that you cited to us, is it not?
Mr. Leo Pfeffer: That case is -- this case is different from the -- it is not however constitutionally distinguishable.
Justice Potter Stewart: Well, that is the question.
Mr. Leo Pfeffer: Well, I -- in my position.
So the reason which I stated in respect to part one.
That too limiting itself as it does to schools in low-income areas is also so purposed and so applied, but as I said it's our position -- it's our position that you have as all the cases that have come before this Court and before any court have held that it cannot pay the tuition for persons attending nonpublic schools where either Equal Protection or most specifically in this case, an express prohibition of the statute is involved, the fact that it is limited to one particular class of low-incomes does not justify, which otherwise would be an express prohibition against financing of religious schools.
Justice Potter Stewart: How about the categorical assistance programs, Mr. Pfeffer?
I am thinking about AFDC, cooperatively financed by the State and Federal Governments.
The amount of the grant to the family with dependent children depends upon the -- generally upon the number of children.
And, what provision if any is made for children in AFDC families that go to nonpublic schools, do you know?
Mr. Leo Pfeffer: The AFDC payments or payments for poor children and the families which are used by those families for their --
Justice Potter Stewart: Well I know, I basically know what the program is, I asked you whether it is made for children who go to parochial schools?
Mr. Leo Pfeffer: As far as I know, there is no specific provision of their tuition to that.
And with -- that is as far as I know, I believe for what --
Justice Potter Stewart: Do you know?
Mr. Leo Pfeffer: I do not know for people beyond --
Justice Potter Stewart: I do not need either and that's reason, I was asking you --
Mr. Leo Pfeffer: Sure, as far as I know the reason there is no such provision that is similar to the G.I. Bill of Rights which goes to everybody -- if it were -- if there were specific grant in there and I am fairly confident of it, a specific grant there for tuition to schools and that tuition was payable to schools which teach and practice religion, I believe will be unconstitutional.
Chief Justice Warren E. Burger: What about the grants for under the GI program, that -- to the tuition to Georgetown law school?
Mr. Leo Pfeffer: Well, in the first place this indeed is pointed out in the various briefs.
This case, this question and the question set – posed by Justice Stewart, also has been considered in many of the cases which I've referred to, considered the past.
In respect to the poverty or indigents.
As a matter of fact, in this very case the majority of the Court pointed out that the fact that this is -- this money goes to in part one, goes to indigent schools, it goes in indigent or in low-income areas, is almost -- I differentiate this from the tax credits for unconstitutionality.
It says tax credits across the board whereas the low-income housing -- low-income schools are mostly Catholic Schools, therefore a specific religious group is benefited and therefore it's unconstitutional even though they held tax credit constitutional.
Now, in respect to --
Chief Justice Warren E. Burger: Well, would your position on that point be different, if it in a particular area that brought the case to us if they were 80 % Lutheran and 20 % Catholic?
Mr. Leo Pfeffer: Not the least.
Chief Justice Warren E. Burger: Would it make any difference of it was 80 % private nondenominational and 20 % --
Mr. Leo Pfeffer: Not the least, I am just pointing to the Court below is using this argument just the reversed way.
I am not -- I am saying that in every case, in every case which came to the court to this Court, Lemon, DiCenso and which all the other courts, the argument has always been, it is stated in the declaration purpose that was out this money from the government, the poor people wouldn't be able to get an education.
That's the basis of argument every case and as court has deemed it, even in the DiCenso, the law they have distinguished between indigent and non-indigent, the poor and non-poor school, it provided that the money can only go to those schools where the cost, the salaries paid to teachers are less than the salaries paid in public schools, that is poor schools, those with the lower payment therefore that in poor schools where and the argument -- the argument in those cases was that without this money, poor people would not be able to go to private schools.
Justice Potter Stewart: Well, that's how justification of the welfare progress, particularly the Categorical Assistance Program for the AFDC for dependent children and fatherless families, isn't it?
Mr. Leo Pfeffer: Yes, indeed.
Justice Potter Stewart: We had a case here, well it is Schwab against Lynx and I also have the captions wrong saying that the state couldn't cut off aid to a child who is attending a -- in his petition of higher learning.
No do you suppose that case would have gone differently if that institution had been a parochial institution?
Mr. Leo Pfeffer: It might very well.
Justice Potter Stewart: Do you --
Mr. Leo Pfeffer: Except on private and if you go to colleges.
Justice Potter Stewart: Let's assume it's a high School.
Mr. Leo Pfeffer: Yes indeed I believe it would, I believe to that extend, it would.
Justice Potter Stewart: You think the welfare --
Mr. Leo Pfeffer: Because the difference --
Justice Potter Stewart: Welfare -- so funds have to be set -- cut down insofar as the children on welfare and family could go to parochial schools?
Mr. Leo Pfeffer: Not necessarily, because this answers the question which the Chief Justice raised.
These moneys go to these parents and it become as their funds.
They have a certain degree of flexibility to what they used if there must.
It's so true with the GI Bill, in the form of law one, the GI did not get GI benefits as they did in World War II, they got bonuses and they used that bonus for a lot of purpose.
Some of them even gave it away to churches, which they had a right to do it?
It was their money.
It was paid to them in compensation for the services of which they rendered to its income.
There was a no stings attached.
Now, because many of the parent -- of the soldiers use this money unwisely, they setup businesses, they gave it away, they gambled it away.
In World War II, it decide to put stings attached and said this, the rationale of the G.I. Bill of Rights.
We have taken a group of American young men away from their lives and we have put them into the army to serve the nation.
During that period, their more fortunate or other contemporaries didn't have to do this and could continue their education in order to make, to earn a livelihood, they can go to college, they can go to trade school, they can even go to seminaries to become clergy man and make a living that way.
Now one way to send the survivors of the Armed Forces back, they had lost three, or four, five years of their preparatory years, and instead of giving them unrestricted money as in World War I, because of the unfortunate experience there, we don't say you have got to use this money, to give you some possibility of making up and earning a livelihood and there ought to be used only for preparation to earn a livelihood to give you a some money for that purpose, and you might even argue, it's not you set aside, that it would have been unconstitutional of religious liberty if the states -- if the government said any livelihood you want accepting your inclusion.
I am not arguing with that one way or other, it's not necessary, but that was -- that was the G.I. Bill looked like.
Justice Potter Stewart: That is the rationale, but how the hell in the world does that affect your First Amendment argument?
Mr. Leo Pfeffer: Because the money was used by them for any purpose, it's their money.
Justice Potter Stewart: But in fact it was used for many of them to go to religious institutions (Voice Overlap)
Mr. Leo Pfeffer: In this case the money could only be used for that purpose, unless they come back, unless the parent comes with a receipted bills from a private school and as my -- the record shows, the brief shows.
96 % of the schools in New York which are private are religious schools.
So, a full part of purpose that means --
Justice William H. Rehnquist: But he -- the person cannot come with a receipted bill from a private nondenominational school.
Mr. Leo Pfeffer: Certainly.
Yes, there are below 4 % of the schools and I don't think -- I think -- I don't think that token could really save the country.
It didn't Lemon against -- it did in the Lemon case, it did in the DiCenso, it did in the Wolman against -- a case which the two Wolmans, the two assets cases which one was already been affirmed without opinion, it was a unanimous case and all those cases, no case that I know --
Chief Justice Warren E. Burger: But since you again emphasize those percentages, what would be the situation in your view if they were reversed 96 % private secular schools, 4 % private sectarian schools?
Mr. Leo Pfeffer: If the money went for tuition, I don't believe it would be constitutionally distinct.
Chief Justice Warren E. Burger: As to the --
Mr. Leo Pfeffer: Because it's still -- it's still a money for tuition.
It isn't a --
Chief Justice Warren E. Burger: Well, then these percentages aren't of any relevance are they?
Mr. Leo Pfeffer: They are relevant mostly towards the third point and it was pointed out by this Court, in Your Honor's opinion in Lemon and DiCenso that and in Walz too, Your Honor's opinion in Walz, that these statutes are all directed for practically one religious group, and I am just relying on like Your Honor said in those cases.
None of them (Voice Overlap) all of the schools.
Chief Justice Warren E. Burger: The Walz case, it was not directed.
Mr. Leo Pfeffer: Well that's why Your Honor upheld the Walz decision because of that pointed out -- you pointed out that it is not directed to one religious group and that's how you run and distinguished.
Chief Justice Warren E. Burger: But we didn't concern ourselves with trying to weigh and measure the proportions, well then why should we here?
Mr. Leo Pfeffer: Well --
Chief Justice Warren E. Burger: Whether it's 964 or 496?
Mr. Leo Pfeffer: No.
In respect to the what the -- the Court pointed out both in Walz and Lemon and DiCenso, the division of the community on religious grounds and the entanglement involved in political attempt in bringing in this issue in political areas and this was one of the things which this Court have attended to prohibit and it is relevant in Waltz towards constitutionality was relevant in Lemon and DiCenso towards unconstitutionality.
Now I suggest it is relevant here towards unconstitutionality as well and this is not created by me out of thin air.
It was brought in by two decisions.
Justice Potter Stewart: But I don't understand that what -- that a majority are Roman Catholic or that a majority are religious because of course in Walz, they were all religious by definition?
Mr. Leo Pfeffer: And there was --
Justice Potter Stewart: And that was the case was about.
Mr. Leo Pfeffer: Yes, yes.
I just add that I believe that even if they were all religious -- it's all religious affair because I think the court and this Court in Everson and McCollum in the (Inaudible) cases and Torcaso against Watkins forbade aiding one religion or all religions, and it make no distinction, and I think will be unconstitutional whether it is one religion or all religion.
Justice Potter Stewart: Then I don't understand how you can conceive the constitutionality of the payments made under the G.I. Bill of Rights after World War II?
Mr. Leo Pfeffer: Well, the answer I say Your Honor, is that this was not even restricted to religion.
This was --
Justice Potter Stewart: No, but all that money went to aid religious institutions, did it not?
Mr. Leo Pfeffer: Yes indeed.
One of my -- just as the bus transportation went to religious and nonreligious schools, but indeed that's true but there was no money paid for --
Justice Potter Stewart: They didn't pay to the school nor as they here?
Mr. Leo Pfeffer: Well, no -- there is not here in a sense that it is not paid directly but there is here in the sense that the money is paid only if you pay tuition in the religious schools, if only if you pay tuition in --
Justice Potter Stewart: If you pay tuition in private schools.
Mr. Leo Pfeffer: Yes private school.
Justice Potter Stewart: Nonpublic schools.
Mr. Leo Pfeffer: Private schools.
96 % of which are religious schools.
Justice William H. Rehnquist: But under the G,I, Bill although the tuition money went directly to the schools, it did not go through the hands of the recipient or the student?
Mr. Leo Pfeffer: No, it did.
It didn't originally but it did go through the hands of the recipients after --
Justice William H. Rehnquist: But it certainly didn't, when I was on the G.I. Bill which was for some four or five years the tuition just simply went to the school.
Mr. Leo Pfeffer: That was changed after the -- the question was brought before Congress, and they realized that there was a constitutional problem thereafter the change of law, that the tuition money went directly to the G.I. not to the --
Chief Justice Warren E. Burger: But the G.I. has simply became the conduit then, did it not?
Mr. Leo Pfeffer: Yes, the G.I. became but --
Justice Byron R. White: There's only – it was only tuition money that was paid to --
Mr. Leo Pfeffer: He could use the tuition anywhere he wanted.
Justice Byron R. White: Yes, but only for tuitions.
Mr. Leo Pfeffer: Only for tuition, they could use it only for tuition, but for tuition in any college, a public college or private.
Justice Byron R. White: Yes but including --
Mr. Leo Pfeffer: No.
Justice Byron R. White: Or in Grade School.
Mr. Leo Pfeffer: Yes.
Justice Byron R. White: Or any high school.
Mr. Leo Pfeffer: That's right, he can use it for any college but in respect to tuition limited specifically, limited specifically except for 4 %; for 4 % which I believe it is token and put in I don't believe it could purify the other non uses, limited specifically to religious schools in 96 % of the cases, I do not believe that could be upheld under any law.
Chief Justice Warren E. Burger: No, did they not under the GI Bill, have some process of inspection and certification after a period when there were some fraudulent schools, spurious operations, did they not then establish regulations under the statute which required the school to meet a particular standard so that the government checked on whether this money was being used wisely in that respect?
Mr. Leo Pfeffer: If the -- Mr. Chief Justice, if they have done inspection, those standards involved surveillance of the schools in the sense which Lemon and DiCenso I believe it could not be upheld under Lemon and DiCenso.
Chief Justice Warren E. Burger: Well there is a certain amount of continuing surveillance of all private schools --
Mr. Leo Pfeffer: Yes.
Chief Justice Warren E. Burger: -- is there not to see that they meet the standards established by the Board of Education?
Mr. Leo Pfeffer: Yes that was that the Court pointed that out in Lemon and DiCenso.
Chief Justice Warren E. Burger: And that's not found objectionable?
Mr. Leo Pfeffer: Yes because, it's not found objectionable but when it becomes two, the use of religious funds, the Court found it objectionable in Lemon and DiCenso.
The Court said --
Chief Justice Warren E. Burger: I am speaking of the general surveillance of all non-public schools that's not the constitutionally objectionable?
Mr. Leo Pfeffer: That's not constitutionally objectionable but on the other hand, that fact does not at least unless this Court overrules Lemon and DiCenso, that fact was not found to immunize that use of public funds for religious, for schools which could teach religion and secular subjects, that's what the Court held in Lemon and DiCenso and the Court, indeed as recently as last year and not in Wisconsin against Yoder.
This Court repeated that statement, the Court repeated it and I should like to just quote what the Court said, as it recently as last year in Wisconsin against Yoder, found Page 14 of my brief. Long before there was general acknowledgment of need for universal formal education, the religion quotes specifically firmly fix the right to free exercise of religious beliefs, but trusting this fund more right was unequally framed, even if equally framed, even if that's explicit, prohibition against the statute venue religion by government.
The values underlying these two provisions were linked to religion, have been jealously protect sometimes even at the expense of other interest of admissibly high social importance.
The invalidation of financial aid to parochial schools by government grants for (Inaudible) is but in this regard is one example of the extent to which the Courts have disregarded, notwithstanding that such aid programs were legislatively determined to be in public interest and it serves the sound education policy by State and Congress, citing the Lemon against Kurtzman, Tilton against Richardson and Everson v. Board of Education, then the fact of those cases are no difference than the facts in this case as I -- and is no different in any of the cases the four District Court cases including the one which Nebraska against Missouri which I have not cited.
All those cases, there were 12 Judges, four from the Court of Appeals, eight from the District Court deciding on tuition grant, not one, not one of those Judges now held that tuition grants is constitutional.
Chief Justice Warren E. Burger: You did not -- I think give us the citation of your Missouri case cited in your brief.
Mr. Leo Pfeffer: It's 332 Federal Sub 275, 405 US 1050 from last year.
Now, let me read something.
Chief Justice Warren E. Burger: Will you repeat that last cite again.
Mr. Leo Pfeffer: 405 US 1050.
Chief Justice Warren E. Burger: Thank you.
Mr. Leo Pfeffer: 97 -- then let me say what a moment what the Court held in the Nebraska case.
This was the DiCenso, Lemon case was decided after the suit was started, and the Court in that respect says, “faced with this decision, the plaintiffs now argue that some alternative program such as tuition grants could constitutionally divide which -- that so they can self-content which be free of government entanglement.
The Court rejected that and said -- and I don't want to return to that -- it said Lemon --
Justice William H. Rehnquist: Was this the parochial parents action --
Mr. Leo Pfeffer: Yes.
Justice William H. Rehnquist: -- to require the States to -- that's somewhat different context.
Mr. Leo Pfeffer: No, it is -- this is -- well it's somewhere between dictum and holding but the Court said that, the Court said that this would be unconstitutional too under the Lemon and we breached them, wholly apart from the fact that entanglement comparable to that described in Lemon cannot be realistically be avoided; if plaintiffs have granted aid for parochial school purposes, particularly on a continuing basis.
It's self evident both the purpose and affect of any statute from tax rate funds to assist parents, the free exercise of religion, would necessarily features a court religion.
So that we have 12 federal Court Judges, not one of them finding any distinction and no state quotes of south and north, both in this context and the Equal Protection racial segregation, not one of them finding any distinction between a direct grant and tuition.
Now I must devote the rest of my time unfortunately, I have not been able to go to it, but I must speak about the third, the tax credit part which indeed the most important because that seems to be which way the wind is blowing.
Now, I concede, if tuition grants are held by this Court to be constitutionally permissible then tax credits are constitutionally permissible.
Chief Justice Warren E. Burger: Do you think that reverse of that is true also?
Mr. Leo Pfeffer: Yes, I think the reverse of that is true.
I think the reverse of that, the reason for that, Your Honor, is because tax credits is merely one-fourth of paying for tuition.
Now, we're not speaking about tax deductions, we're not speaking -- that's not before this Court although -- we're not taking about tax exemptions, we're not speaking tax exemptions nor tax deductions.
Justice Harry A. Blackmun: Is there a difference Mr. Pfeffer?
Mr. Leo Pfeffer: Between exemptions or between deduction?
Justice Harry A. Blackmun: Well, is there a difference between – yes, would a tax deduction make it be a different case?
Mr. Leo Pfeffer: It might, the District Court -- in the case which was decided after this, which is not found tax exemption.
Chief Justice Warren E. Burger: We will let you answer that after lunch
Mr. Pfeffer you have about 15 minutes of your time left.
Mr. Leo Pfeffer: I just want to answer -- complete my answer then I will reserve my time for rebuttal.
The District Court in Ohio case cited in brief Katya (ph) case and Professor Froing (ph) among others are the opinion that there is no difference between tax credits and tax deductions, that their equally unconstitutional.
I am inclined to think that a fairly good case could be made of the constitutionality of tax deductions for tuition paid to parochial schools.
I think there is a wall of a difference between credits and deductions.
For reasons which I don't want to -- which I state in my brief and which is stated by the Court below, Judge Garfield (ph) in his opinion, stated the reasons why there is a difference between tax deductions, tax credits, but I think I could -- a reasonable argument could be made that if a payment for tuition to parochial school what treated as a contribution to the parochial school, in other words it would be deductible to that amount to no more and treat like the contributions to a church which are tax --
Justice Potter Stewart: Or medical deductions --
Mr. Leo Pfeffer: Or medical deduction itself.
Justice Potter Stewart: -- for service three in a Catholic Hospital.
Mr. Leo Pfeffer: Anything, if it were treated as a deduction then I think that it could -- a reasonable argument could be made for its, that is constitutional.
I know that's a poor point to disagree with me and I of course, respect his (Inaudible) of constitutional law but I believe it can be made but where the, as in the statute, he is simply reduced the tax liability by a certain amount and instead of paying the government like you owe it, you'd reduce an amount which is set forth, which determined by the statute and it has nothing to do with how much you deduct, how much your tuition is, it will depend upon your income status and it's -- I can see no difference between a situation where you owe the government 'X' dollars for your taxes and you pay the government that amount.
The government sends you an independent check for your tuition which you owed, which you have paid to a parochial school.
I see no constitutions different between that situation, and a situation where instead of paying the government of what you owe them on your income tax, you'll send them a state a receipted bill for your tuition and you deduct that amount to may --
Justice Byron R. White: Whether it's a credit or deduction, neither does any business who had income, unless you have the monthly income to make sure ti was?
Mr. Leo Pfeffer: Well, if you don't have and you get under the new --- they will give you the money in the form of tuition.
Justice Byron R. White: That's right.
Mr. Leo Pfeffer: Under a statute.
So you'll get the money from a state loan of your --
Justice Byron R. White: And a deduction wouldn't do any body good without it?
Mr. Leo Pfeffer: That's right, that's right.
It doesn't do them any good because I -- and therefore in this state -- in this statute, they give you the cash in the form for tuition.
Justice Byron R. White: Right.
Mr. Leo Pfeffer: In Ohio and in some other states, they give you a negative income tax rate.
They pay as a money but you don't pay it.
I would like to reserve the rest of my time.
Chief Justice Warren E. Burger: Very well, Mr. Pfeffer.
Argument of Jean M. Coon
Ms Jean M. Coon: Mr. Chief Justice and may it please the Court.
Question of perspective here, we think that the validity, constitutional validity of the statute here at issue, revolves not solely around the precise language of the statute, but the intent and purpose with which the New York State Legislature enact them.
The legislature in 1972 undertook to meet certain specific needs of children attending non-public schools and their parents.
It was confronted with a growing clamor for tax relief on the part of parents who paid tuition in the non-public schools on behalf of their children and who also additionally support public schools in the form of tax payments, was faced with the problem of increasing safety hazards in non-public schools which particularly in low income areas, have been unable to meet the cost of maintenance and repair essential to health and safe structures.
Further, the state had become increasingly cognizant of the problem faced by low income parents in paying the tuition necessary to the selection of a non-public school education for their children.
And finally and while not directly relevant to this appeal and still part of the same legislative enactment, in those areas where the financial crisis in the non-public schools had forced their closing, the public schools had been faced with increased cost of education in general and particularly in the cost of additional physical space for the increasing enrollments.
Consequently, in an attempt to meet or impart to alleviate what the District Court here indeed recognized were basically secular problems.
The legislature, the state of New York adopted Chapter 414 of the Laws of 1972.
Now, I will address myself initially in this argument to the problem with which Mr. Pfeffer left off that of the income tax portion of the legislation, then to health and safety grants and finally to that portion of the statute relating to the tuition reimbursement to low income parents.
The tax portion of the statute provides not for a tax credit but for a modification of adjusted gross income for the purposes of New York determining the New York state income tax payable.
For New York State income tax purposes, the adjusted gross income is the same on both the Federal and state returns with the exception of a number of state modifications.
There are additional modifications of gross income which are provided solely in state law and not under the Federal tax returns.
For example, a deduction is not allowed on the state return for income tax, state income taxes which have been paid, although, it is allowed on the Federal return and on the state return an additional modification is allowed for life insurance premiums paid although they are not allowed on the Federal return.
Chief Justice Warren E. Burger: Is there a limit on that?
Ms Jean M. Coon: Yes there is.
It's -- I think it was this year.
Well, it had been $150, it's now less than that.
This Court has indeed recognized that the states have an inherent power and authority in enacting tax legislation.
The powers of the state to tax its citizens are coequal with those of the Federal Government and are only limited by this specific limitations on the state's power found in the Federal constitution.
Justice William H. Rehnquist: Mrs. Coon.
Ms Jean M. Coon: Yes.
Justice William H. Rehnquist: Are you going to address yourself to the precise manner in which this New York tax -- the portion of the statute dealing with tax operates?
It came up by knowing question during Mr. Pfeffer’s argument as to whether it's a credit or a deduction or an exclusion, are you going to address yourself to the precise manner in which it operates?
Ms Jean M. Coon: Yes, You Honor, I am.
We think it is particularly significant here that, in the cases involving the constitutionality of the Federal income tax law, this Court upheld the validity in the face of arguments that there were differences in the classes of income tax deductions or exemptions that were allowed, that they were not uniform as to all tax payers and then some could claim ones which others could not.
We submit that the New York legislature in selecting and enacting a tax legislation has the power to select what income to tax, how much of the income it wishes to tax, and to provide for deductions and exemptions in whatever amount and for whatever purpose it elects.
Justice Potter Stewart: The credit is different.
Ms Jean M. Coon: A credit is -- a tax credit is different.
A tax credit comes off with the tail end.
Justice Potter Stewart: It's just to forgiveness of what you owe the Government --
Ms Jean M. Coon: Yes.
Justice Potter Stewart: -- it's a set off.
Ms Jean M. Coon: Right.
Justice Potter Stewart: It's like paying you money directly.
Ms Jean M. Coon: Now in this particular instance, this comes off at the top.
This is a modification of income for the -- prior to the determination of the amount of tax owed.
It comes off at the beginning of the tax return.
It's a reduction of your income subject to tax.
We submit that this is equivalent to in legal principle to a deduction or to an exemption because it is a thing which reduces your income which is subject to tax not a forgiveness of tax owed.
Justice Potter Stewart: But it isn't.
If you pay a $300 a tuition, under the New York plan, you don't get a $300 deduction from your income.
Ms Jean M. Coon: No, you do not.
Justice Potter Stewart: No, you do not.
So it's not a deduction as that term of this is generally understood in tax law, is it?
Ms Jean M. Coon: No, it is not, but it also is not a tax credit as that term is generally understood because the tax credit also amounts to a precise dollar amount.
Justice Potter Stewart: But tax credit, is just the reduction of the amount of money you owe the government directly, that's what a credit is.
Ms Jean M. Coon: That's what a credit is and this is not, this is -- we submit equivalent legal principle to a deduction or exemption even though in terms of the actual mechanism by which it operates, it doesn't come out the same way.
Justice William H. Rehnquist: Well, isn't that close this too an exemption for that you get, for dependents on your Federal income tax return, isn't that closest analogy?
Ms Jean M. Coon: Well it is closest to analogy because your exemption is not related to an actual expenditure.
It's a fixed amount.
So it's closest to an exemption.
Justice Potter Stewart: Yes, but that -- the exemption comes out of -- it serves to reduce your taxable income and that extend is like a deduction.
Ms Jean M. Coon: Yes and to that extent, this is precisely the same way that this does reduce your taxable income.
Justice Potter Stewart: I thought it was a gear to operate to actually reduce your taxes directly.
Ms Jean M. Coon: No, no.
Comes off the top.
Justice Potter Stewart: Well, maybe you'll expand this as Justice Rehnquist had suggested in the earlier question.
Ms Jean M. Coon: New York State has actually had a history of tax credits which have not been related to specific purposes.
There have been a tax credit to single or married people which is directed at reducing in tax owed.
For example, for a single person 1254, a married couple $25 reduction and up until this past year, we have taken off as a tax credit of the income tax after it's been computed.
Justice Potter Stewart: And that's a true credit.
Ms Jean M. Coon: That's a true credit.
Justice Potter Stewart: A forgiveness of part of what you owe in taxes?
Ms Jean M. Coon: Now, this on the other hand, the modification of gross income, starts at the top of the income tax return and this comes off before you compute your tax liability, comes off --
Justice Thurgood Marshall: This should be like the box that goes over and how many exemptions you have.
This would be like another box, right there.
Ms Jean M. Coon: Yes, except there is -- it's figure is slightly differently since it's figured differently in amounts but it comes off at that part of the tax return, it comes off in that --
Justice Thurgood Marshall: But it is a flat amount?
Ms Jean M. Coon: No, it varies based upon income.
Justice Thurgood Marshall: That's right.
Ms Jean M. Coon: The persons with an income of less than $9,000 or less, it's a thousand dollars, if your income is between -- I think it's 20,000 and 23,999, it's a $100 and above that it's a zero amount.
Justice Thurgood Marshall: Yes.
Ms Jean M. Coon: So that the --
Justice Thurgood Marshall: And it would be up in that level.
Ms Jean M. Coon: Right.
Justice Thurgood Marshall: On the returns.
Ms Jean M. Coon: Yes, would be up at that point, it's up -- in that point of part of the return, before you start computing your taxable income and tax liability.
And to that extent, we say that it operates much the same as the deduction or exemption and probably much closer to an exemption simply because the exemptions themselves are set as fixed amounts which unrelated to the purpose for which it's granted.
In other words, exempt, present exemption of the Federal Income tax is $750.
Justice Potter Stewart: But that's the same theory about it, be as income $5,000 or $500.
Ms Jean M. Coon: Yes.
But it's also unrelated, it's unrelated to the actual expenses necessary to live for the beneficiary for the dependent for whom it's claimed.
Justice Potter Stewart: It's a very appropriate day to be discussing this?
Ms Jean M. Coon: Yes.
[Laughter] Although actually in New York state we are entitled for an additional day because the internal revenue district office in Massachusetts has a legal holiday today.
[Attempt to Laughter] But an exemption also varies -- can be claimed additionally, there are additional purposes with exemption for persons over 65 going and so forth.
So the exemptions do multiply in to some degree, not directly related to the number of persons involved.
But to that extent because it is also not directly involved in the question of the actual amount spent, we say that this is closer to an exemption than to a deduction, but is a legal principle equivalent to either a deduction or exemption rather than a tax credit because it relates to the modification of taxable income prior to the computation of the tax due.
We submit that the addition of a modification of gross income, allowable to a tuition paying parents of children in non public schools was no more and no less than exercise of the state’s inherent power to determine the measure of personal income subject to taxation by the state.
Justice Byron R. White: So what -- if any -- if it only from the deduction if it is an exemption or a deduction if the -- it has a differential effect there depending on how much money you make?
Ms Jean M. Coon: Yes.
I should also point out that in the medical deductions, for example from the federal income tax, there is a difference there really as to whether or not you can claim them depending upon your income.
The higher your income, it is the less likely you are not ever going to get a medical deduction off a federal income tax.
This initial portion of the statute, we submit is not only simply an exercise of the state’s power of taxation, but also meets the secular purpose and effects which were set forth by this Court in the Schempp case.
The purpose of this statute and as was specifically found by the District Court was to provide tax relief to tuition paying parents of children in non public schools.
It was not to provide aid to the schools themselves.
The primary effect also is found by the District Court would not be a benefit to the non public schools, but rather to the tuition paying parent.
The Court recognized the fact that by the time the parent’s income tax liability is fixed and determined, and when he files his returns, his tuition has long since been paid and that any benefit he gets out of this reduction and the eventual reduction of the tax which would be most likely pocketed by him and used for his own personal purposes rather than turned over to the school.
That it is in-chronologically unrelated to the time of paying tuition and would therefore not be considered to be using the parent here as a conduit to paying money to the schools.
Without payment to the schools or any contact with the schools attended by the parent, incidentally on the New York State income tax return in claiming the modification of gross income, a parent is not required to state what school he sent the child to.
He simply adds it in as an item off of his return and only if he has subsequently audited, would there be any question raised would he ever have to prove to what school the money was paid.
Justice Potter Stewart: Is there any query in these papers, a tax form that shows us how this works?
Ms Jean M. Coon: No.
I can get you one.
We have some of it for you.
Chief Justice Warren E. Burger: That might be helpful to all of us.
I suggest that copies to your firms that if you would submit some illustrations as to just how that works, it might be helpful.
Ms Jean M. Coon: Okay.
I know I have some of those.
All right, without payment to the schools or with any contact with the schools attended by the children, we submit that there can be no entanglement between governor, religion, let alone excessive entanglement.
The provision of tax relief to parents can in no way be construed as an unconstitutional aid to religion.
There is here no First Amendment violation in the District Court’s judgment and that should be affirmed.
As to Section 1 of the --
Justice Byron R. White: Was the choice personally made in fact people are getting the --
Ms Jean M. Coon: Only if his income is less than $5000.00, then he would have to make the choice.
The purpose of that of course is simply to see they do not get a double benefit.
Justice Byron R. White: Well, the person but the -- I suppose a person could have too little income to get any benefit out of the creditors, is that true?
Ms Jean M. Coon: That's true.
Justice Byron R. White: Which of that he would take a provision?
Ms Jean M. Coon: That I assume that would be true.
Chief Justice Warren E. Burger: Would that possibly be true if he had too much income?
Ms Jean M. Coon: Well --
Chief Justice Warren E. Burger: Does it function at any point the way the medical deduction does in the federal, you had an analogy to that and I am not sure I followed it.
Ms Jean M. Coon: Well it's over -- if your income is over $24,000.00 a year, you cannot take --
Chief Justice Warren E. Burger: None at all?
Ms Jean M. Coon: You cannot take the tax relief and if your income is over $5000.00, you cannot take the tuition reimbursement.
Justice Potter Stewart: You are eligible for the tuition relief only if your income is below $5000.00, is that correct?
Ms Jean M. Coon: Yes.
Justice William J. Brennan: Or I take it chances are if your income is under $5000.00, you would have no tax to pay anyway?
Ms Jean M. Coon: I would assume that that would be --
Justice William J. Brennan: And I expect that is why the provision for -- the reimbursement to the extent it is --
Ms Jean M. Coon: I would think so because there would be no.
Justice William J. Brennan: -- of people under $5000.00.
The over $5000.00 simply wouldn't work for the under $5000.00?
Justice Byron R. White: But your deduction -- your deduction or exemption, whatever you call it or credit, whatever you call it, does not go progressively down up to 24, does it?
Justice Potter Stewart: Yes.
Ms Jean M. Coon: Yes it does, goes progressively down.
Justice Byron R. White: Progressively down and then ends at 24?
Ms Jean M. Coon: Yes.
And apparently it's assumed that if your income is over $24000.00 you can afford to send your children to non-public schools without needing any tax relief.
I am sure their parents would disagree with that but that was a legislative philosophy behind it. Getting to Section 1 of the statute, the so-called health and safety grants, the legislature specifically found that the financial crisis of non public schools in low income areas have resulted in deferred maintenance and repair programs and it had also resulted in an increase in health and safety hazards to the children attending those schools.
Hereto, the District Court in this case found that the conditions and problems set forth in the legislative findings were valid and expressed a secular legislative intent.
The bill provides, as Mr. Pfeffer said for a specific dollar amounts per pupil with an additional dollar amount for pupils attending schools in buildings constructed prior to 1947 and would be paid to the schools as a partial reimbursement for prior expenditures for repairs and maintenance.
The expenditure of the money we submit is safeguard in two ways.
First, the amount may not exceed 50% of the state wide average cost of maintenance repair in the public schools and may not exceed the actual amount paid by the non-public school in the preceding base year.
Further, not all non-public schools were qualified for grants under this program.
Only those schools will qualify which have been certified as serving a high concentration of low income pupils for the purposes of Title IV from the Federal Higher Education Act of 1965.
Title IV involves the specific grants to a teacher to read and teach for educational purposes for persons and educational institutions who are preparing for teaching, who will agree to teach in low income areas.
The schools involved in this will be approximately some 250 out of 1400 non public schools in the state of New York.
In perspective, we must observe that this Court has never held at all direct payments to non-public schools were unconstitutional.
Now you must also state that there is a long tradition of federal as well as state aid to the non-public schools in the form of special benefits and direct payments to either the schools or their students.
To use as example, the school lunch program, tax exemptions, the G.I. Bill of Rights and the programs and benefits under the Federal Elementary and Secondary Education Act of 1965.
We cite many other instances in our brief on this appeal.
It must be assumed that the payments and benefits so provided had been considered not to aid religion but rather to have some other public and secular purpose.
The statute here at issue we submit was adopted in the exercise of the state’s police power to protect the health and safety of children of the state.
Contrary to the argument Mr. Pfeffer seem to advance, we do not consider and we do not complete with the Court’s decisions have ever considered that the police power was directly related to what we normally consider as crime policing.
Police power has had its purpose and activity in various fields of health and safety far beyond the normal criminal justice system.
The latitude which has been inscribed to the police power by the Courts is very great.
This Court has indeed held that the state has a sovereign right to protect the welfare of its people.
And while most of the cases cited in our brief relate to regulatory statutes adopted in an exercise of the police power, we submit that there is no essential, legal or constitutional difference between statutes which regulate and statutes which provide money to accomplish the desired police power purpose.
In fact, the Everson case, as Mr. Pfeffer said, we submit supports this because this Court in Everson upheld bus transportation on the basis that as a police power measure, designed to get children safely to non-public schools to protect them from the hazards of, as this Court said of either hitchhiking, walking a high-rise.
Justice William H. Rehnquist: Well that really doesn't answer your problem here though, does it?
If it is a valid exercise of the police power, that means you have got the first conclude, it doesn't violate the First Amendment and if it doesn't violate the First Amendment, it is a valid exercise of the police power?
Ms Jean M. Coon: Yes, Your Honor, that's a correct statement.
I would think it does not violate the First Amendment.
Unknown Speaker: (Inaudible)
Ms Jean M. Coon: Well, I think in this respect, this was the purpose of the statute.
It was a police power statute.
It had a -- it was not intended to benefit religious schools.
It was not intended to benefit religion, it was not intended to benefit the schools essentially as institutions.
It was intended as an exercise of the police power to protect the health and safety of the children, the state’s citizen children who were attending these non public schools.
Justice Potter Stewart: Well as Justice Rehnquist said, it might be a perfectly valid exercise that the state’s reserve power or their police power, that power companiously known as the police power.
So far as the due process clause goes or something like that but that doesn't -- that begs the question of whether or not it violates the First Amendment, doesn’t it, First and Fourteenth Amendment?
Ms Jean M. Coon: No I think this is what we get to from there.
Chief Justice Warren E. Burger: Well, just to pursue that for a moment then.
It might be perfectly valid as applied to a secular school, a private non-denominational school and I take it Mr. Pfeffer would not question that if the state decided to make grants.
It runs afoul, the First Amendment as Justice Stewart and Justice Rehnquist suggested if it runs afoul as soon as you bring -- introduce this other element.
Ms Jean M. Coon: All right.
Well, we advance the police power I think as a -- to demonstrate the secular intent, the legislative purpose of this.
Contrary to Mr. Pfeffer’s argument, we do not see in the language of the First Amendment a direct prohibition against aid to parochial schools.
Chief Justice Warren E. Burger: Well what if, for example Mrs. Coon, the school, the building was condemned, it was in such a bad state of repair.
It was condemned because it was hazardous to the health, the safety of the stairways.
It was a fire hazard and a lot of other things.
In your view, could the State of New York contribute the money to build a new building under the exercise of its police power?
Ms Jean M. Coon: I would think that they could at least contribute the money to rehabilitate the structure.
The state does this now not in terms of schools.
Chief Justice Warren E. Burger: That's this case, but I am speaking of now, the new building, could they say we now condemn it, we’ll tear it down, we’re going to put up a new building and we, the State of New York will pay for it.
You think they could do that?
Ms Jean M. Coon: No I don't think we go -- I don't think it goes that far because what we are saying here is that we are trying to protect the safety of children in the buildings they attend.
Now if the building were in such a case that it had to be condemned, to be torn down, but it could not be rehabilitated.
To that extent then there is no question of the safety of the children in the building in which they are attending.
That would be -- that's a different question.
Justice Thurgood Marshall: Well suppose they found a seminary that was -- all the seminaries were in complete need of rehabilitation, the same findings that they made here as the elementary and high school, would you say the state could contribute to all of that?
Ms Jean M. Coon: I would think no.
I think that the difference is one of the state’s interest in protecting children who are, for whom the state acts in a different plain and certainly from the adults who would be attending seminary.
Justice Thurgood Marshall: Suppose they found that all of the church schools were in need of rehabilitation, where all they taught was religion, would that be all right?
Ms Jean M. Coon: Where all they taught was religion?
Justice Thurgood Marshall: Huh, huh.
Ms Jean M. Coon: I would think no because we're talking here about -- we're talking --
Justice Thurgood Marshall: So First Amendment does limit the police power?
Ms Jean M. Coon: Well it limits the police power because in that extent, I suppose we would say that the money would be going directly to the aid of religion, if all the school taught was religion.
Here we're talking about schools which mean things --
Justice Thurgood Marshall: But don’t let me get to the half-n-half and 40-60.
Now I think --
Ms Jean M. Coon: No I don't think we get into that.
I don't think it is half-n-half and 40-60.
I think it is a question of what the state is doing, is that it's relating to the children who attend schools which meet the requirements of a secular education for whom the state takes its interest, to whom the state has this interest in relating to their education.
Justice Thurgood Marshall: Well, on the interest of the -- the interest of the state in supervising the private schools, what is the state’s reason for that other than the enforcement of its compulsory attendance law?
What other reason does the state have to supervise these schools?
Ms Jean M. Coon: I think that's its whole reason.
It's the enforcement, the compulsory attendance and the compulsory attendance law does more than just say whether the student goes to school on a particular day.
Justice Thurgood Marshall: And that's the state’s only --
Ms Jean M. Coon: Precisely and this case, the state’s interest is that these students have a right to go to these non-public schools for the purpose of complying with this compulsory education law, for the purpose of attending these non-public schools, for the purpose of getting a secular education to that extent that the state has the -- not only a power of supervision of the schools but also the right to get in to the issue of the health and safety of the structures which they attend.
To this extent, we say that this is a -- that the primary intent in affect of the statute was not aid to religion, did not violate the First Amendment that it did and the health and safety grants also complies with the constitutional mandate and the intent of the First Amendment.
Briefly, I should like to mention the tuition reimbursement portion of the statute.
It is --
Chief Justice Warren E. Burger: That is part two, is it or is it --?
Ms Jean M. Coon: It's part two of the Section 2 of the statute, yes.
First of all, that the tuition reimbursement provides for a payment to low income parents of the lesser of two amounts.
Either 50% of the tuition paid to the non-public school or $50.00 per child per year in elementary school or $100.00 in secondary school so lesser of those two amounts.
We say that this is equivalent to the -- to those other public measures which enable parents -- in which the state participates in the assistance of low income or indigent parents or indigent persons.
Before lunch, Justice Stewart asked the question concerning the ADC payments.
New York State as the Court may be aware has the flat grant system of payment to ADC to welfare recipients, but prior to that time, prior to the time that the flat grant system was introduced, where there were categorical grants for various things such as rent, heat, food allowances, clothing allowances and so forth, the state education law required payments for the educational expenses of children and this was interpreted to include not only tuition to non-public schools, but also the expenses of books, clothes which would include uniforms for non-public schools, educational supplies and so forth.
And since the flat grant option, the pressure increased upon the legislature for the benefit of the low income parents were directly related to the fact that they no longer were getting this assistance which they had in the past for the purpose of tuition, reimbursement as well as other expenses of children attending non-public schools.
Along with that and there has been additional feeling within the legislature that the -- since low income parents as well as upper income parents have a constitutional right to send their children to non public schools, that they should not be deprived of this right solely because of their lack of income.
We have equated this to some degree with the welfare system, with the provision of low income housing, with the state’s provision of certain benefits in the way of transcripts of administrative hearings and so forth to persons who have low income or who are poverty stricken.
To this extent we submit that the low income portion of the statute was itself intended not to benefit the schools, it is paid to the parents long after the tuition has been paid.
It is not -- they are not used as a conduit for the payment to the schools.
There is here no direct aid to the schools and the only indirect aid results from the fact that the attendance at non-public schools may be made easier for some children, a benefit which this Court has held, does not constitute, an unconstitutional aid in religion in and of itself.
Justice Potter Stewart: Mrs. Coon, does -- under the New York system of government, does there have to be an appropriation for this periodically or once the law is enacted, does it just automatically --
Ms Jean M. Coon: No, there have to be an appropriation periodically.
All money is to be paid out of the state treasury and subject to appropriation.
Justice Potter Stewart: Was that bi-annually?
Ms Jean M. Coon: Annually.
Justice Potter Stewart: Or annually?
Ms Jean M. Coon: Annually.
Justice Potter Stewart: And so this law isn't self executing from the point of view, it is financing?
Ms Jean M. Coon: No it is not, for purpose by the effect that the state constitutional provision which prohibits any payment out of the state treasury unless there is a specific appropriation.
Justice Potter Stewart: An annual appropriation for it?
Ms Jean M. Coon: Yes.
Justice Byron R. White: Mrs. Coon, is there any certain limitation finds of the parochial school.
Does it fit under this New York--?
Ms Jean M. Coon: Yes, to this extent.
The school must of course comply with the state’s compulsory education law.
It may not discriminate on the basis of race, it may not discriminate on the basis of religion except as to its own -- if it is a religiously oriented school as to its own religious denomination.
In other words, if a Catholic school determines to accept any non-Catholics, it could not discriminate between groups of non-Catholics.
So there is that limitation.
Justice Byron R. White: It may still have been in the program even though it limits this admissions to a Catholic?
Ms Jean M. Coon: Yes, persons of its own religion.
Justice Byron R. White: And even though one of the requirements in the parochial school is that you said --
Ms Jean M. Coon: Yes that would be, that would be true.
It's not something that the statute looks at.
The statutory enactment is not concerned with those requirements of the school, but it would -- if that is a type of school to which a parent determines to send their child, this would be permissible.
The only prohibition is against racial discrimination and then as I said, this discrimination between religion so they did not have the other school.
We have covered I think the issue of severability of the statute in our brief and I believe that part of the argument --
Chief Justice Warren E. Burger: Thank you Mrs. Coon.
Argument of Porter R. Chandler
Mr. Porter R. Chandler: Mr. Chief Justice, may it please the Court.
I am here representing two groups of parents.
One, are parents with taxable incomes of less than $5000.00 who are eligible for tuition refund under Section 2 of the Act.
The other group of parents have adjusted gross incomes of less than $35000.00 and are eligible for the tax modification provided in Sections 3 through 5 of the Act.
The emphasis that I want to make from the start is that this statute is aimed to help parents, not schools and that we represent parents who are directly affected.
Now what kind of figures are we talking about?
I realize from questions this morning that the percentage one or the other is not of particular importance, but we are talking now about the children in New York State who go to non-public schools and there are about 750,000 of them as compared to about 3,200,000 public school.
The 750,000 non-public school children attend schools of all categories.
The only requirement of the school is that it should give a satisfactory education in secular subjects and that it should not discriminate on the race and so on as indicated in what Mrs. Coon just said.
Justice William J. Brennan: I gather it cannot be a profit making school?
Mr. Porter R. Chandler: Can't be a what?
Justice William J. Brennan: Profit making school?
Mr. Porter R. Chandler: Can’t be a profit making, you are quite right, Your Honor, a non-profit school that comes with every requirements of the compulsory Education Law.
There are a total of something around 2000 such schools in New York State and the figures roughly are that about 1400 of them are affiliated with the Catholic Church.
300 or a little more are affiliated with I think some dozen or more other religious bodies, the largest one next to the Catholic Church is the Jewish Schools and about 300 more are non-religiously affiliated, total of about 2000, they are accounting for 750,000 children.
And while I am on the subject which has been injected again and again, I want in some of these cases, I want to correct second misapprehensions as to what the Catholic school at least is or is not.
It is not a school for rich or medium well-to-do.
It is increasingly becoming a school of the poor and of minority races.
The figures show that in New York City alone, there are 70,000 families with children in Catholic schools who are -- have incomes at or near the poverty level.
The figures show that Catholic elementary schools in the Bronx and Manhattan have 31,000 non-white children attending out of 65,000 total.
More than 60% of the children in catholic schools in Manhattan are black or Spanish speaking and over 30% in the Bronx.
So the --
Justice Potter Stewart: That would be, as a matter of this fact, that would be largely the Puerto Rican community, would it?
Mr. Porter R. Chandler: Largely Puerto Rican.
Well, New York has a rather large Spanish other than Puerto Rican community, rest of Latin America and from Spain itself.
Yes, the others would be primarily Puerto Rican.
And now, the statute comes before you with very strong legislative findings as to each of the Sections involved and the statute recognized the burdens that are now being borne by parents who send children to accredited non-public schools who read the state of that tax burden, under Section 2 to 5.
Concentrating first on the tax, on the tuition reimbursement, the character is that the requirements for admission to that ballpark are that you should have an income of less than 25 -- income of less than -- taxable income of less than $5000.00, that you should have children in a non-public school, that you shall have paid tuition for having them there and the tuition, as Mrs. Coon pointed out, the tuition that is ultimately reimbursable can in no case exceed half what was actually paid.
It is half what was actually paid or $50.00 per annum for elementary school pupil, $100.00 per annum for high school pupil.
I mentioned that because with all respect I think Mr. Pfeffer misquoted this morning.
He said that you could get up to the full amount of tuition which you cannot.
On the tuition reimbursement provision, the trial Court found that there was a good secular legislative purpose and the effect is actually, we submit, neither to the grants nor to inhibit religion.
It's the nature of pluralistic society to see that all segments of the society have a right to mature and develop and be adequately represented.
New York, with its tradition of over 200 years of a single system of education, both public and private, under the Board of Regions has always laid stressed on promoting plurality and diversity and the refund, as I have emphasized is for the benefit of parents, it goes to parents only.
There is no question of a conduit here.
Parent has his child in the school.
To get him in, he has to pay tuition at the beginning of the year, he pays it and he is parted with that money.
Some months later, after he has filled out the necessary forms, he gets back from the state a check representing a small fraction of what he may have paid to the school.
He does not -- that's his money, he has already paid the school.
There is no connection between the two of them.
It is perfectly open to that parent to say I don’t like this school any longer.
I won’t bring my child back next year, I’ll take him out.
And it is all right for him to say “I’ve got $50.00 here from the state, it is a win for all, I will go spend it at the races.”
Or if he is feeling more charitable, he will say to his wife, “In lieu of the price of steaks, I am going to give you this money, you can go downtown and buy a good nice steak to celebrate with.”
There is no accounting.
In the assertion this morning --
Justice Thurgood Marshall: He of course recognized that he knew about that when he paid the money to the school?
Mr. Porter R. Chandler: He knew that the money was coming.
Justice Thurgood Marshall: Yeah.
Mr. Porter R. Chandler: Yes, that's right.
Justice Thurgood Marshall: (Voice Overlap) argument but I think you ought to --
Mr. Porter R. Chandler: Just as the parent, the parent who paid the bus company in Everson, he knew he was going to get it back but when he got it back, it was his money I think, Your Honor.
There was discussion this morning of the G.I. Bill of Rights as an example of this tuition business.
I could -- we have listed in our brief various other similar items such as the region scholarship and the scholar incentive programs in New York State and I shall develop those further.
As to entanglement, this tuition refund requires a minimum of entanglement.
There must be a verification the children are actually enrolled at schools, no entanglement there.
A verification that tuition has been paid, then a verification that the individual in question is not telling different stories to the people to whom he is asking for the tax refund and the tax authority.
In other words, if he says he has an income of $4972 they were checked with the Federal Tax Commission, the State Tax Commission to see if that is right.
Turning now to the brief moments left to the tax relief business.
We have discussed in our brief the question of tax credit versus tax exclusion versus tax deduction and so on.
A typical tax credit is the $12.50 that every New York resident is entitled to take off of his income tax after he figures it all out, and he figures that he has to owe $483.97 and then just for being a taxpayer, he is allowed a flat cancellation of $12.50 of that money whether he is a millionaire or whether he is a pauper.
That is an example of a tax credit.
Tax exemption, I think, the best example is what Your Honor has held in Walls namely, a particular person or institution who just doesn't have to pay any taxes or doesn't have to pay a particular category of taxes.
This is just what the statute describes it.
It is a tax modification and it comes off as Mr. Justice Stewart observed, it comes off the top rather than from the bottom.
Section 5 comes to the Court with this strong legislative finding which I am going to read.
Such educational institutions, that refers to all the institutions covered by the Act, religious and non-religious, such educational institutions not only provide education for the children attending them, but by their existence relieve the taxpayers of the state of the burden of providing public school education for those children.
That finding was adopted almost ipsissimis verbis in the District Court.
As with the tuition reimbursement, I emphasize that this is only partial relief.
The beneficiary is the parent and not the school.
There is no grant from the treasury.
There is a secular intent, namely equity and the benefit is not through, if any to religious schools that are so remote as to are not to involve them permissible entanglement.
And there is a minimum amount of administrative entanglement.
All those were specifically spelled out by the District Court, as reasons for sustaining the constitutionality of this Act.
I don't think I need to say, repeat that the state has wide authority in classifications, in tax things and there is no person that I know of for holding this unconstitutional.
The District Court said, in holding that their secular purpose as well as the facts were strong, the lightening of the tax burden of those who contribute to public education while deriving no benefit from it for themselves, albeit this is a voluntary choice, is a legitimate legislative purpose.
I accordingly request, Your Honors that the judgment of the District Court be reversed as to tuition refund section and that section be held constitutional and that the judgment of the District Court as to the tax modification be affirmed and that likewise be held constitutional.
Chief Justice Warren E. Burger: Thank you Mr. Chandler.
Argument of John F. Haggerty
Mr. John F. Haggerty: Mr. Chief Justice and may it please the Court.
An attack on a particular aspect of the state’s effort in education fails unfortunately to look at the state’s responsibility and commitment for education from its total aspect.
This is somewhat has happened today.
It's my purpose to outline the New York State’s legislature’s commitment and responsibility for education.
Article 11, Section 1 of the New York State Constitution fixes the primary duty to provide for the education of all children in New York State on the legislature.
It requires that the legislature provide for a system of free schools wherein all the children of the state may be educated.
We educate four million children in the elementary and secondary schools of New York State each year.
Approximately 18% or 750,000 of these attend the nonpublic schools.
The cost of state financing of public education rose to over $2.5 billion in the 1972-1973 fiscal year, and increased to $500 million over the 1969-1970 year.
The cost of the state of educating the 750,000 nonpublic school is virtually non-existent.
The cost of educating -- the total cost of education in the state of New York is $5 billion, another $2.5 billion contributed by the localities.
The support of the nonpublic school education is in the main from contributions, endowments and of late, approximately but not quite 1/3rd through tuition payments by parents, who in addition to making this tuition payments also have a normal tax load.
Chief Justice Warren E. Burger: Of course, the people under $5,000 are not paying -- in New York City to the people under $5,000 five children pay any taxes to the State of New York?
Mr. John F. Haggerty: No they don’t but what I’m attempting to do is put into the total perspective of the educational aspect.
Chief Justice Warren E. Burger: They’re paying sales taxes.
Mr. John F. Haggerty: They are paying sales taxes, and they're paying if they own real properties, some type of real property tax.
They do pay some type of real estate tax if there is a charge back by the landlord to attendant in an apartment.
The greatly increased cost of nonpublic education plus ruinous inflation, plus ever increasing taxes on all levels of government including education has precipitated a danger within the nonpublic school system in New York State.
I have delineated in pages 11 through 15 of my brief why this is of such great consequences to it there is not a tax base to which the public schools infer the look in a number of our cities to increase their total commitment towards education.
To fulfill its responsibility in the public sector, the state contributes cash grants and aids.
General cash assistance on a per capita basis on a formula derived through weighted average attendance is the primary form.
Faced with the crisis in the public schools and mindful of their responsibility for the education of all children, including the children in the nonpublic schools, the legislature enacted the program which is here under review.
They determined that it was in the public interest and that it was important that not only the nonpublic school system of education New York continue to exist but that there be available a plurality of educational opportunity in New York State.
When talking about the children in nonpublic schools, we are talking about New York State citizens, about our own children.
So just as we provide for cash assistance on a per capita aid basis in the public schools, the legislature responded by overwhelming proportions in the private sector by enacting a program of moderate, minimal and varied assistance to low income children and their parents and to middle income parents and to support their voluntary effort in education.
This is not a special isolated program, it's part of the general program of assistance to education by New York State.
Indeed, it would seem that if New York State was so determined, it could have quit itself of its educational responsibility by total grant and aid assistance to all of the parents, both public and nonpublic.
If that be the case and allow those parents to determine what schools they wanted to send their children, whether it's public or private, if that be the case, it would appear that New York, having made its choice of its machinery or mechanism to strike down the nonpublic sector would be to put form before substance.
New York’s minimal program of aid reflects the appropriate and the required governmental neutrality toward religion.
It neither governmentally establishes a religion nor governmentally interferes with the religion.
Our task in enacting the Omnibus Act was we felt to reach that neutral ground between the Establishment Clause and the Free Exercise Clause.
The New York program does not encourage attendance at nonpublic schools, indeed in any of event, it's going to be more costly.
The state is simply not involved in the parent’s choice of what school the parents chooses for their children.
While the program may enhance the ability of a parent to exercise his choice of which school his child would attend, it is nevertheless completely neutral in that it does not favor religion over non-religion, it does not sponsor a particular sect nor does it try to encourage participation in or abnegation of religion.
The question of whether or not a distinction should be made for programs of aid to poverty area schools and to low income parents should distinguish it from an overall program.
In enacting legislation, it was felt strongly that a program of aid of health and welfare grants to low income impoverished areas which had certain restrictions did fall within the welfare assistance benefit program and should be considered as a welfare benefit program.
These restrictions are as follows.
The schools to be benefited incidentally about 280 out of the total 2,000 nonpublic schools are benefited by Section 1, the schools to be benefited must be schools which have a substantial proportion of children attending whose parents receive ADC.
In addition, that's required by Title IV, in addition, under Title IV, teachers, in those schools who had gone to higher education on loans would receive a forgiveness from the Federal Government because they are teaching in these tight ghetto area schools.
The school cannot be in violation of the Civil Rights Act of 1964.
To avoid the question of entanglement, we require that the school provide a private audit.
There is no involvement of the state going in that.
The school provides a private audit and that private audit is forwarded to the state.
Justice Potter Stewart: This comes to about 280 schools out of a total of around 2,000?
Mr. John F. Haggerty: 2,000 non public schools in the state and about 280 of the schools are benefited by Section 1.
Justice Potter Stewart: Almost under 15%.
Mr. John F. Haggerty: Under 15, between -- about 12%.
The question arose is to whether or not the chapel could be painted.
The answer to that is clearly no.
The legislative findings are restricted to expenditures which are clearly secular, neutral and non-ideological in nature.
Expenditures for a chapel clearly could not fall into that restricted criteria.
The Commissioner of Education of the State of New York is given the authority to promulgate rules and regulations where he could not approve as a result of getting this private (Voice Overlap)
Justice William J. Brennan: Well, I take it Mr. Haggerty if the heating system broke down under the statute, the entire heating system which also heats the chapel could be replaced, could it not?
Mr. John F. Haggerty: The heating system could be replaced to the extent that it would fall within the definition of a secular, non-ideological (Voice Overlap)
Justice William J. Brennan: Well I know, but you have a central heating system in the school and it collapses, and that has to be replaced and it heats every room including the chapel.
Mr. John F. Haggerty: Yes.
Justice William J. Brennan: And under this statute, it could be replaced, could it not?
Mr. John F. Haggerty: It could be replaced but we have built into the statute what we consider a statistical requirement of neutrality and that is that --
Justice William J. Brennan: I know but, that was my question, it could be, it could be replaced, could it not?
Mr. John F. Haggerty: It could be replaced, but our preposition in formulating the legislation was that we would never get to a position to where we would pay the total amount of the repair or replacement of the heating system because in no event can the cost reimbursed by the state be more than 50% of the comparable cost in the public sector and that we try to build in as a statistical degree of neutrality here.
Justice William J. Brennan: Well, my only point was, you may not be able to paint the chapel under this, but you can repair the heating system that heats the beside chapel, can't you?
Mr. John F. Haggerty: That's correct, but our purpose was not that you could provide for the total cost of repairing the heating system.
Chief Justice Warren E. Burger: But I suppose implicit in your answer is that in very few schools would the chapel exceed 50% of the total heated space, is that a reasonable assumption?
Mr. John F. Haggerty: That's correct.
In answer to Mr. Justice Marshall, the answer as to the question of whether we could provide such services or such repairs to schools where all they teach is religion, the answer is no because again it must be only those areas which are non-ideological, secular and neutral.
Justice Thurgood Marshall: (Inaudible)
Mr. John F. Haggerty: Hopefully, we won't have to do that.
The number of schools that are sectarian were incorrectly stated in that 96%.
There is approximately 82% of the nonpublic schools in the State of New York are sectarian.
And finally with regard to the modification of gross -- adjusted gross income and whether or not that distinguishes from any other type of income tax change.
Section 612 (c) of the New York State Tax Law provides for some 15 or 16 modifications.
An example of which you can modify your adjusted Federal gross income by subtracting there from any amounts of income derived through United States savings plan.
This is a modification.
Well what we do is add to Section 612 (c) an additional modification which will provide on a reduced graduated scale as you go up the line to an income of $25,000, an amount which would be taken away or reduce your Federal adjusted gross income for New York State income tax liability.
The purpose of this was that we would benefit the parent who is benefiting the state by their voluntary effort in the nonpublic or private school arena and we are doing it on the first level so that we benefit the parent before it becomes involved in any other types of upstate moneys.
Finally, I would suggest that on the question of the modification of tax income, the Court looked to the decision of the majority below upholding the modification program where it points out that it does not involve a subsidy, or grant this money from the state treasury.
It has a particular secular intent, one of equity to give some recompense by way of tax relief to our citizens who bear their share with the burden of maintaining the public schools and who because of religious belief or otherwise send their children to nonpublic full time schools as is their constitutional right.
The benefit to the public appropriate schools, if any, is so remote so as not to involve impermissible financial aid to church schools and lastly there is a minimum administrative entanglement with the nonpublic schools nor is ongoing political activity likely to cause division on strictly religious lines.
It was our intent to reach the neutral point between the Establishment Clause and the Free Exercise Clause and we submit that the judgment of the Court below with regard to the health and safety grants be reversed with regard to the tuition reimbursement be reversed with regard to the tax modification be affirmed.
Chief Justice Warren E. Burger: Thank you Mr. Haggerty.
I got to limit myself to one question to on your rebuttal Mr. Pfeffer.
Suppose you had -- I start with your comment this morning that there is no constitutional barrier to the State of New York provided funds and tax credits to private, secular schools.
Would you have such a private secular school maintained by anti-religious people and all these credits were given, does that give rise to any possibility of violation of Equal Protection or possibly the Free Exercise Clause?
Rebuttal of Leo Pfeffer
Mr. Leo Pfeffer: I think it may even give a rise to a question on Establishment Clause as well.
Chief Justice Warren E. Burger: With Free Exercise --
Mr. Leo Pfeffer: Or even more than Free Exercise -- Free Exercise and Establishment because Establishment Clauses as it is defined by this Court in a number of cases equally forbids aid to religion and aid to anti-religion.
The classic expression --
Chief Justice Warren E. Burger: In my hypothetical, I wasn't assuming that they had a sign on the building that this is an anti-religious school.
I am simply assuming it's a secular school?
Mr. Leo Pfeffer: Oh!
I think it is a (Inaudible) school.
If it is a secular school --
Chief Justice Warren E. Burger: Patronized by people who do not want their children (Voice Overlap)
Mr. Leo Pfeffer: Oh!
I am sorry, I misunderstood, I thought you said a school.
No, if it's a purely secular school, then it's a public school, because that's what's this Court held under McCollum and Engle against Vitale and the Schempp case.
Chief Justice Warren E. Burger: Does that give you any equal protection problem in this respect?
Mr. Leo Pfeffer: Well, I don't see, how it's – as a matter of fact this Court has all decided on the Nebraska case, the Nebraska case, that was the argument of the plaintiffs in the Nebraska case, that there was a violation of Equal protection because Nebraska, the case which I cited this morning, respect to a suit brought by parents of children attending private schools parochial schools, who claimed there was a violation of Free Exercise because the private schools were excluded/ The District Court unanimously rejected that this Court affirmed without any dissent.
There is no, let me put it this way, there is no violation of equal protection in the classification which the First Amendment compels.
That's what this Court held, the First Commendment compels, this Court said in Lemon, DiCenso, compels non support in whole or in part of parochial schools.
So if the First Amendment compels it and the state complied with it, obviously it's not following the action.
Well, I should like to address myself primarily to, but I wasn't able to do it, this morning, the tax credit provision.
It is our contention that this is a tax credit statute.
Mrs. Coon has conceded that that's not tax deduction stuff.
The Court below called it a tax credit.
Now it is not tax deduction statute for obvious reasons.
In the tax deduction, you deduct from a gross income the amount you have contributed, that's what you do when, if you make a contribution to a hospital, to an art museum, to a church.
He do not deduct.
The state figures out for you and in our brief and in the jurisdictional statement of all the parties and their briefs, the state figured out, on page six of my brief, the amount you will get, benefit you will get by the deductions and it's clear that the benefits stopped where the tuition grant stops, $50.00 per child.
Now if you make, I will make a contribution of $1000.00 to a Church, to an art museum, I deduct from my gross income $1000.00 and then my income tax is determined on the balance.
If I pay tuition of let’s say $50.00 for each child, then that -- I don't deduct $50.00 from my gross income, I deduct up to $1000.00 a child, up to $3000.00 from my gross income, why?
In order to get the $50.00 which will be allowed to me per child.
Now the state has done that itself.
This is the analysis given by state legislature.
It is simply using the device of the tax system to achieve a payment to the parents of children in pubic schools.
Justice William H. Rehnquist: Well Mr. Pfeffer you say this is a tax credit.
Mr. Leo Pfeffer: Yes.
Justice William H. Rehnquist: Now how do you define a tax credit as opposed to a deduction or an exemption when you are using that term?
Mr. Leo Pfeffer: I do it in several ways.
First, a deduction is one which is uniform to all, in respect to all contributions.
There is no difference between a grant, how much you contribute to an art museum, to a scientific institution, to the FPCA on a market deduct to contribute to parochial schools.
Here is the reason; if you contribute $50.00 to the art museums, you deduct $50.00 from your taxable income.
Here, if you pay $50.00, you don't deduct $50.00 from taxable income, you deduct $1000.00.
Justice William H. Rehnquist: Then your definition of tax credit is a broader one than the one which would simply say a tax credit is an amount you subtract from the otherwise computed tax (Voice Overlap)
Mr. Leo Pfeffer: I would say that the First Amendment --
Justice William H. Rehnquist: Well, will you answer my question?
Mr. Leo Pfeffer: Yes.
In this context yes.
In this context, this is a tax credit.
It would be a tax credit if --
Justice William H. Rehnquist: But then it is a broader definition than the one I just mentioned to you?
Mr. Leo Pfeffer: It is a broader definition, yes indeed and indeed Mrs. Coon did conceded that.
She said this is not a tax deduction.
Justice Thurgood Marshall: (Inaudible)
Mr. Leo Pfeffer: I would deem that unconstitutional.
I would deem that unconstitutional because that is an obvious preference of aid within the class of tax credits.
Unknown Speaker: (Inaudible)
Mr. Leo Pfeffer: I said, I believe that's unconstitutional because this constitutes a benefit exclusively limited to those who send their children to parochial schools.
It would be both equal protection and --
Unknown Speaker: (Inaudible)
Mr. Leo Pfeffer: In any event what this -- what this Title implies, it recognized, Mr. Justice Rehnquist, that's not a tax deduction because it allows you this money even if you deduct, if you have deductions or even if you take a standardized deduction, you don't itemize.
You have already got the benefit of deduction and whatever it is, 10% or whatever it is.
The statute specifically says that you still get this, you still get this amount even if you have already, you have gotten the benefit.
Justice William H. Rehnquist: But what you get is something that you are entitled to subtract from your adjusted gross income, not something which is entitled to subtract from the tax that you have already computed to be due?
Mr. Leo Pfeffer: The only thing I can answer to that is that this means elevating the form of both the substances, maybe pretense and it was clear because as the court below pointed out that this is a tax credit and as all the -- my opponent say, that the purpose of this statute was a recognition of the serious finance conditions of a private schools and the non-private education and put one statute, all these things.
If the whole purpose of this is to get money into the private school, else, the whole purpose of the statute fails, else the provisions regarding the impacted aids have no --
Justice William H. Rehnquist: But you could make that same argument if you are simply here dealing with an orthodox tax deduction, that the whole purpose was to get money to the private schools?
Mr. Leo Pfeffer: Oh!
No because no tax deduction applies equally to every type of beneficiary and the Court answer that in Walz that where you have a uniform gift, a uniform treatment of all non-profit organizations, museums and so on, then avoid entanglement.
Justice William H. Rehnquist: But suppose that you weren't dealing with a gift here, that you are dealing with someone who is obviously a payment for services rendered, tuition and the state made that simply deductible?
Mr. Leo Pfeffer: I think that tuition -- services rendered, in all instances.
If it was deductible as a deduction, in other words the amount you paid is deducted.
Well, I think, if it's deducted from your gross income, I think, as I have indicated before it maybe constitutional.
If we deduct it from what you provided, I think it will be unconstitutional and that's what this, what has it done here.
You are deducting the amount in tuition.
You are deducting an amount which the state figured out will give you back your tuition, $1000.00 per child, you pay tuition $50.00.
You will get a deduction of $1000.00 up to $3000.00, nor to -- nor that you can get your tax liability reduced $50.00, even if you’ve already gotten a deduction, a permnanet or standby deduction.
And the state says, the statute says, you have got to make your choice.
If you want to get this money, you have two ways.
You can get through a benefit of this or you can get through a benefit of the tuition grant section.
They’re both the same purpose.
You take a choice here, when we are giving you $50.00 back, one way or the other.
You can take it through a tuition grant, if you are assuming you’re under 5000.
You can take it through tuition grant, you can take it through this, but obviously the purpose in both cases is the same.
Now, I just want to make one point about the -- what Mr. Haggerty said about the fact that the money can't be used in respect to the maintenance and repair cannot be used to repair the heating system as far as the chapel is concerned and so on.
Assuming that is so, it isn't or assuming that so, that thing you are back into the problem of entanglement.
That propels the state into checking how your money is used and an average, it's not enough because in Tilton, only 50% was government funds, 50% was government funds, the other 50% came from the college yet the Supreme Court said, that you cannot use those premises for religious purposes even after 20 years, even for one lecture in religion, even for one mass set.
After 20 years, even though the government pays only half, so the Federal Government pays only half here, does not remove the constitutional thing.
The government cannot, in the First Amendment, pay in whole or in part for the maintenance of institutions which teach or practice religion.
The Court said long before -- the Court said that in McCollum against Maryland where only a very small portion of the school, for a half hour to an hour a week was used for religious education.
Chief Justice Warren E. Burger: Thank you Mr. Pfeffer.
Thank you Mrs. Coon and gentlemen.
The case is submitted.