Testimony of Robert L. Grete
Page 12

light of the fact that the First Amendment religious clauses use the expressions "establishment of religion" and "the free exercise thereof," confining unencumbered religious activity to churches or any other organizations prescribed by the federal government is obviously discriminatory and a direct violation of the First Amendment. I attach my letter to Senator Dole of 5 December 1983 (ATCH 5), which points out the difficulty caused by certain language included in several public laws that produce this discrimination. Attached to that letter is also a document explaining the biblical and constitutional objections RBCS has to any government taxation that permits controls over religious ministries. I believe the details in that

correspondence are sufficient to completely illuminate our concerns in this area. I realize that I am now in the position, even after passage of the Tax Reduction Act of 1984, of being jailed and heavily fined for failing to pay our institution's share of this unconstitutional tax. I would pray that the Congress would see the catastrophic effects that coercive inclusion of religious ministries in the Social Security system can have on our country.

The above specific cases of our confrontation with the federal govenment is a rather mild sampling of the handicaps that government action have placed on Christian schools when viewed from a national point of view. Nevertheless, they are sufficient to demonstrate that religious liberty is at great peril in our country.

I thank you for this opportunity to express an independent Christian School administrator's perspective on the threat to religious liberty in America today. As we drift further away from the divine Author of liberty, the foundation for liberty is eroded. Liberty authored by autonomous man inevitably degenerates into tyranny.

In accordance with the spirit of your article, "Helping the CLA to Help You," in the November Defender, I enclose the facts of a problem RBCS expects to have with the IRS. The most dangerous aspect is that IRS unilaterally revised our exemption in a way that implies RBCS must begin paying social security and unemployment taxes, which, of course, we will not do. To assist your analysis, I provide the following facts and supporting documents. Please advise if you need anything else to complete our file.

On 12 June 1973 (as a Christian Air Force officer and Elder, Forest Lake Bible Church) I accompanied my Pastor (Harold E. Thomas) to visit Bob Thoburn's Fairfax Christian School in Fairfax, Virginia. It was there I realized that I could not use the government schools to educate my six children, but was, of course, very ignorant of the details of the philosophy of Christian education and the increasing state animosity toward Christian schools. We reported the findings of our visit to the Joint Board of our relatively new and small church, which voted not to establish a Christian school because it would excessively dilute efforts to perform other necessary operations. I asked if there were any objections to individual members beginning an independent Christian school; there were no objections.

God led us, on 3 July 1973, to commit ourselves to establishing RBCS. Although on active duty, I accepted the responsibility of Director and using Bob Thoburn's manual and advice from a local "Christian" lawyer, began laying the school's foundation. We opened that September with 22 students, grades four-year-old kindergarten through six, two full-time teachers (Mrs. Grete and Mrs. Thomas) and two part-time teachers. We now have 200 students.

I was advised that we must write a Corporate Charter (Atch 1), Bylaws (Atch 2), and obtain Federal and State Tax Exemption Letters to legally operate as a tax-exempt corporation not-for-profit. I followed applicaion procedures to obtain our original Federal Tax Exemption Letter uted October 21, 1974 (Atch 3), which directed us to file IRS Forms 990. lease forgive my continuing ignorance of the issues, but this we dutifully 13.

In December 1976, the Air Force sent me on a one-year remote tour o Korea. While there, I continued to study and learn more about Christian ducation. In summer 1977, the school office filed our FY 77 Form 990, which IRS apparently lost in a shuffle between their Atlanta and Philadelphia offices. We were advised by IRS letters dated May 19 and June 23, 1978, (Atch 4) that IRS did not have our FY 77 form. We sent them a reaccomplished copy dated July 15, 1978 (see remarks, Atch 4). As we were accomplishing our FY 78 Form, we received another IRS letter Ar. Samra dated October 19, 1978 (Atch 5), stating that IRS could not d our FY 77 Form 990. At this point, I began to question the propriety our filling out the Form 990, and read the instruction booklet more refully. Since the language of the instructions specifically exempts schools below college level operated by a religious order," I replied to Mr. Samra's October 19 letter with mine dated 6 November 1979, presenting rationale for the position that we should not file Form 990 (Atch 6). I did, however, include our reaccomplished FY 77 and new FY 78 forms.

I heard nothing for two months. On 15 January 1979, I queried Mr. amra on his progress in getting an answer to my question of 6 November,

i.c.

"Why must RBCS file annual Form 990?" (Atch 7). He responded on 7 February 1979, that he could not find my 6 November 1978 letter (although he apparently had the Forms 990 under control), and that he was forwarding my request to the Jacksonville, Florida, office (Atch 8). To facilitate the Jacksonville office's work, I indorsed Mr. Samra's letter and forwarded a copy of my 6 November 1978 letter on 13 February 1979 (Atch 8).

27 February 1979 is an interesting day in this case. On that day, Maye Harper of the Atlanta IRS office wrote that she had just received y 6 November 1978 letter to Mr. Samra. She explained how our forms may ave been lost, and advised that she sent the 6 November letter to Jacksonville for reply (Atch 9). (I was so pleased with the helpfulness of her response that I wrote her a letter of thanks on 20 April to which she responded on 3 May. This correspondence is also at Atch 9.)

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Also on 27 February, Ms. G. Farley (signed Withers) of the Jacksonville office sent a classic piece of bureaucratic garbage brushing off my question and giving us 60 days to file amendments to our charter since they had no record of them in their file (Atch 10). (Their own copy of our exemption letter, however, indicated that our file had been checked OK after our amendments had been received see Atch 3.) I believe this is a case of harrassment.

To understand what follows, I must relate something I subsequently overed: Jacksonville had two separate working files on RBCS with two rate case officers (Ms. Farley and Mrs. Dewey) who didn't know what other was doing.

19 April 1979, I responded to Ms. Farley's February 27 letter 11), asking her to give à serious answer to my question (she hadn't even seen my 6 November letter), and providing additional copies of the amendments missing from her file.

On 25 April 1979 I received a phone call from Mrs. Dewey (see MFR at Atch 12), saying she just received my 6 November letter (probably the one sent by Maye Harper). After cordially discussing First Amendment issues, she said she would get with Ms. Farley to give me an official response.

On 7 May, I received a very hostile call from Ms. Farley, who had received my 19 April letter but had neither spoken to Mrs. Dewey nor read the rationale in my 6 November letter (see MFR at Atch 13). Before hanging up on me, she said she would leave it to Mrs. Dewey to respond to my question.

On 8 June 1979, Mrs. Dewey provided the IRS response to my question (Atch 14). She quoted two lower court cases which I do not believe are relevant to my argument. At issue in her argument is the definition of a church. I prefer that of Scripture; IRS does not. Her bottom line is that since our exemption letter of 21 October 1974 indicates RBCS is a school, we must file the 990. I took no action to respond to this since I was too busy with other things.

The shocker came when I received from D. Warnick (Jacksonville) an unsigned determination letter modifying our original 21 October 1974 letter (Atch 15). My comparison indicates that the revision imposes on RBCS the unlawful and unconstitutional requirements to collect social security and federal unemployment compensation taxes. It reaffirmed our obligation to file the 990.

I do not consider the unsigned revision authoritative. I do consider it unlawful harrassment.

On 13 November 1979 I filed our FY 79 Form 990 covered by a letter reaffirming my conviction that IRS errs in asking us to file it (Atch 16). and responding to Dewey's 8 June 1979 answer to previous correspondence. Please see the letter for the exact language, but my bottom line is that IRS does not have constitutional authority to interfere with religious ministries either through tax laws or subversive definitions. I asked if it were the IRS position that Biblical definitions are to be rejected in favor of those of IRS's own making, and again appealed for a finding we are not liable to file the Form 990.

liat

I have not yet received a direct response to my 13 November 1979 tter, but did recieve an IRS form letter dated December 17, 1979. knowledging receipt of my FY 79 Form 990, and instructing me to provide aditional information (Atch 17). In my original return, I inadvertently did not check a Part V block indicating the Reason for Non-Private

Tour.dation Status, and also missed the requirement to fill out Part VI. Since their request for additional information only requires a check in Part V, block 2, (they sent no form with Part VI) that is all that I

ending them at this time.

I hope to hear from you before I hear from IRS again. Request you advise me:

1. What action should RBCS take in response to the revised
determination letter dated July 20, 1979?

2.

3.

Should I respond to any more requests for Form 990
information?

Where should I go from here in the effort to get IRS to
recognize that they err in asking for the Form 990 from
RBCS?

I praise God for your ministry.

In Christ's service,

LG: 1h

Attachments

Robert I.. Grete
Director

I have received a copy of your proposed Revenue Procedure on Private Tax-Exempt Schools, announced in the Federal Register of 22 August 1978. I appreciate the opportunity to provide you my comments on a proposal which I firmly believe is unsound and unconstitutional. I respectfully request that you withdraw the proposal from consideration.

Let me first make clear that Rocky Bayou Christian School has a genuine nondiscriminatory policy. On both Biblical and Constitutional grounds, we declare that no student will be denied admission on the basis of race, color, or ethnic origin. My objections to your proposed procedures have nothing to do with the goal of facilitating equal opportunity in education. We fully support that goal. I find the proposal objectionable because it is destructive of that goal and the basic liberties guaranteed the American people by the First and Fourteenth Amendments to the Constitution of the United States.

First, I notice that the IRS definition of a racially nondiscriminatory policy requires that the school not discriminate on the basis of race in the administration of its policies. Yet the five factors to be used to determine that a school is nondiscriminatory are blatantly discriminatory and racist. Schools are being asked to demonstrate their nondiscriminatory policies by discriminating on the basis of race. This is nonsense. 1984 is here! Not only is it nonsense, but also it is unconstitutional (if I understand the Bakke decision correctly).

Secondly, the proposal to avoid discrimination by discriminating burdens schools with the administrative cost of keeping records according to race, when we should consider race an irrelevant criterion. I do not count how many blue-eyed/brown-eyed/ green-eyed/icky-eyed students we have. This is irrelevant information. Why does IRS want me to keep records according to racist criteria? I want to see a student as Fred, Sally, or Brian, not as our Black, Chicano, or Asian. Your proposal is destructive of the goal to truly make race an irrelevant criterion. You are requiring decisions based upon racist criteria. You are forcing schools to bear costly, unnecessary administrative burdens to carry out racist actions in the name of nondiscrimination.

If the above two objections were my only objections, I doubt that I would take time out of my very busy schedule to comment on the proposal. I would figure IRS would not bother RBCS anyway. No court has determined RBCS to be discriminatory; we were not formed about the time of public school desegregation in our community, and we have enough fine students from the ethnic minorities in our community to meet your quota standards. So why should I bother to write to you? The answer lies in the significance of my third objection.

Our constitution incorporates some rather precious liberties which include due process of law and religious freedom. The proposal violates the former because guilt is presumed and the accused is required to go to the expense and trouble of proving innocence. That is backwards. If a school discriminates on the basis of race, those wronged can provide the basis for a legitimate determination of guilt. This illegal procedure is the type of tool tyrannical government can use to intimidate according to whim. For example, as the performance of Christian school students increasingly embarrasses those responsible for the increasing failure of the statist schools to graduate students of academic competence, the already increasing efforts of some governmental officials to eliminate the competition could reach a fever pitch. The NEA is already in a state of panic, and is collecting as many political debts as possible. The IRS has great potential in the hands of tyrants. We must be vigilant to insure that government agencies do not violate due process of law.