Court Says Revenue Bonds For Religious College OK Under Establishment Clause

In Gillam v. Harding University, (ED AK, June 24, 2009), an Arkansas federal district court held that the city of Searcy, Arkansas did not violate the Establishment Clause when it issued tax-exempt revenue bonds to finance construction of facilities at Harding University. The University is affiliated with the Churches of Christ. The bonds were issued under the Arkansas Public Facilities Board Act which allows the city to set up a special board as the bond issuer. The court concluded that the bond issuance did not have the primary purpose or effect of advancing religion, nor did it create excessive entanglement. Harding did not use the bond proceeds to finance facilities used for religious instruction or as a place of religious worship. The court said that it is irrelevant here whether or not Harding University is a pervasively sectarian institution. Finally the court also rejected challenges claiming the bond issuance violated Art. 12, Sec. 5 of the Arkansas Constitution that ban cities from obtaining money for any private corporation, and Amendment 65 to the state Constitution that sets out certain limits on the use of revenue bonds. Arkansas News Service yesterday reported on the decision.