schools. We fear, however, that the test of significant minority enrollment will place many schools like ours across the country in the position of being considered racially discriminatory simply because we do not have a minority school enrollment equal to 20 percent of the minority school-age population of the community we serve.

We recognize that the IRS has provided us with certain alternative methods by which a school which lacks sufficient minority enrollment can demonstrate that it is in fact racially nondiscriminatory. It is in this area of perhaps well-intentioned direction that our first amendment rights are grossly trampled under foot by the proposed regulation.

The revised proposal gives six suggested ways in which a school may demonstrate that it is in fact racially nondiscriminatory in the absence of minority student enrollment. No specific number is required to prove nondiscriminatory practice. In fact, the proposal

states:

The level of actions and programs that are adequate may vary from school to school and depends on the circumstances of the school, including the level of minority students enrollment.

Consequently, there is no objective test given whereby a school can judge its own actions, or a member of the IRS staff could be guided to a fair and unbiased conclusion. Every one of the six alternatives involves the IRS in the internal affairs of the school, and in the case of a church school, the IRS is dictating internal policy to the church. The IRS is making a serious error in moving in the direction of defining religion or dictating internal church policy. It is in fact ignoring several established precedents resulting from court actions in this area. In the well-published Ohio school case, the State of Ohio was attempting to force all private schools in that State to meet a minimum standards program. One small school refused to meet those standards on the basis that it was a violation of their religious convictions. It was a church school, incidentally.

On appeal to the Ohio Supreme Court, the court ruled in favor of the school stating among other things that the standards as a whole unduly burden the free exercise of religion.

It is our opinion that the six standards established by the IRS in their proposal result in an unduly burdensome restraint of the free exercise of our religion. These six factors would involve the IRS in the advertising program of the school; its recruitment program; force many to establish scholarship programs for minorities when none exist for other students; place schools in the position of inviting students to attend the school they may in turn be forced to reject because they do not meet the spiritual standards of the school; force them to recruit unsuccessfully from secular colleges where the philosophy of education taught is inconsistent with that of the church school; participate in extracurricular activities with schools that are of a different philosophical makeup when this is not their normal practice; make curricular changes to accommodate minority students when such changes have no relationship to the overall philosophy of the school; and seek persons for board positions who have not voluntarily sought to affiliate themselves with the sponsoring church for reasons of religious

conscience. All of these matters result in serious entanglement of the government in the internal affairs of the church.

Justice Frank Celebrezze in the same Ohio school case previously cited, made two significant observations concerning government relationship to religion:

(1) It is crystal clear that neither the validity of what a person believes, nor the reasons for believing may be contested by an arm of government.

(2) The requirement that all activities of a nonpublic school must conform to board policies plainly violates appellant's right to the free exercise of religion. How can the State remain neutral and yet require all activities of a nonpublic school to conform to State policies.

It is our belief that the same kind of conflict anticipated by the application of minimum standards to a nonpublic school exists with the application of the proposed IRS procedure to religious schools.

It is also important to note that the Norwood case which the IRS cites as partial basis for their proposed procedures does not require a specified quota to prove nondiscrimination.

Everybody seems to be quoting things that would tend to support them in their points of view but no one has mentioned these two points: What Norwood said is that it was "important to emphasize that the ultimate issue *** is not whether black students are actually enrolled *** but whether their absence is because the school has restrictively denied their access." Norwood also said: "No one can be required, consistent with the due process clause, to prove the absence of violation of law."

It is the position of the Georgia Association of Christian Schools that if, in fact, the IRS has a responsibility in this area, it is to deal with proven cases of discrimination. That is, actual cases where students have been denied admission to a specific school because of their race. We submit that the current procedures already in force are more than adequate for the IRS to deal with such alleged cases of discrimination.

Several of the persons testifying this week have suggested that it is unfair to black parents to force them to bear the burden of taking allegedly discriminatory schools to court to have to protect their interests.

This burden in reality does not exist because current IRS regulations provide for the IRS to investigate any tax exempt school when a complaint concerning racial discrimination is made against that tax exempt school.

Further, I would like to raise this rhetorical question: Why should everyone be required to support public education? There have been numerous suggestions that private schools exist as alternatives to public schools. This is totally in error. Free public education in the United States was developed as an alternative to the then-existing private schools.

We submit that the current procedures already in force are more than adequate for the IRS to deal with such alleged cases of discrimination, if in fact racial discrimination is the real issue, and not the fact that the educational philosophy of our schools is different from that espoused by the public schools.

[An attachment to the statement follows:]

LEGAL BRIEF PREPARED FOR THE GEORGIA ASSOCIATION OF CHRISTIAN SCHOOLS, INC., BY WENDELL R. BIRD, ATTORNEY

The Georgia Association of Christian Schools is writing this brief to express our opposition to the Proposed Revenue Procedure on Private Tax-Exempt Schools, that was published in 43 Fed. Reg. 37296 (Aug. 22, 1978). We view this Revenue Procedure as an abridgment of our religious freedom under the First Amendment and a violation of our due process rights under the Fourteenth Amendment.

I. THE PROPOSED REVENUE PROCEDURE WOULD ABRIDGE OUR FREE EXERCISE OR RELIGION The First Amendment protects free exercise of our religion from governmental interference. Our religious exercise involves Christian education as well as formal worship, because the Bible tells us to "train up a child in the way he should go" and to teach "the fear of the Lord" as "the beginning of knowledge," while the Bible at the same time warns us to avoid "oppositions of knowledge falsely so called" and to regard "the wisdom of this world" as "foolishness with God." Our churches include our Christian schools as well as our worship services or our Sunday schools, because our churches' great commission is to "teach them to observe all things Jesus Christ commanded” as well as to "preach the gospel" in all the world. Our Christian schools generally share the corporate charter of our churches; our churches control and operate our Christian schools; the school superintendents and administrators are church staff members; all school teachers generally are church members; and each Christian school is generally advertised as "a ministry of" the particular church. Our Christian schools are an integral part of our churches and our religious exercise, and interference with our Christian schools is interference with our churches and our religious exercise. See Hinton v. Kentucky State Board of Education, Civ. No. 88314 (Ky. Cir. Ct. Oct. 4, 1978) (holding that burdensome regulation of Christian schools violates free exercise of churches' religion); State v. Whisner, 47 Ohio St. 2d 181, 351 N.E. 2d 750 (1976) (same).

Abridgment of constitutional religious right

A. The tax exemption for religious activities is a vital part of religious freedom. The Supreme Court has written that "freedom from taxation . . . has operated affirmatively to help guarantee the free exercise of all forms of religious belief." Walz v. Tax Commissioner, 397 U.S. 664, 678 (1970). We believe that the tax exemption for churches and their Christian schools is an accommodation mandated by the free exercise clause. See Follett v. McCormick, 321 U.S. 573 (1944) (overturning tax on religious book distributors as violation of free religious exercise); Murdock v. Pennsylvania, 319 U.S. 105 (1943) (same); Hannegan v. Esquire 327 U.S. 146, 151 (1945) (overturning revocation of second class mail privilege as violation of free speech, though could still use more expensive mail class). While we recognize that some lower court decisions have treated the religious tax exemption as a privilege rather than as a constitutional right, we believe that this religious tax exemption is a First Amendment right under the free exercise clause. We make this assertion because of the universal existence of exemptions from all existing taxes at the time of ratification of the First Amendment, and because of the recent expansion of governmental taxes and regulations with their accompanying power to destroy and burden religious liberty. Just as a revocation of the churches' tax exemption for solely religious activities would contravene our free exercise of religion, a revocation of our Christian schools' tax exemption for religious activities would violate our free exercise of religion.

Abridgment by unreasonable rebuttal requirements

B. Several unreasonable requirements of the Proposed Revenue Procedure for proving a school's nondiscriminatory purpose would violate our free exercise of religion. (1) To meet the requirement that minority enrollment at our Christian school be twenty percent of the minority population “in the community," the Revenue Procedure would effectively prevent our Bible-commissioned outreach to nearby cities. For example, it would prevent the outreach of Forrest Hills Christian Schools to nearby Atlanta, because if more than five percent of the school's students came from Atlanta then the entire eighty percent black Atlanta school area would be included in that school's "community." and this would vastly increase the number of minority students necessary to preserve the school's

tax exemption though these additional Atlanta students would not comensurately increase the number of minority applicants and students. By taking ten students from Atlanta (five percent of the student enrollment)—even if they were all black-the school would have to enroll about 200 more black students, in order to avoid being presumed discriminatory. In other words, this school either must forsake its commission to evangelize Atlanta and to offer it Christian education, or it must drag in more new minority students than the total new Atlanta students. (2) And to meet the requirement that four of five factors be met, the Revenue Procedure would effectively hinder our Bible instruction to all students, because the Revenue Procedure would divert money from paying for religious instruction and materials to giving scholarships, financial assistance, and affirmative recruiting efforts to minority students.

Abridgment by reporting requirements

C. Moreover, the reporting requirements that would be necessary now and in the future to preserve our tax exemptions would violate our free exercise of religion. Just as requiring our churches to report information about the racial identity of our membership would contravene the free exercise clause, requiring our Christian schools to report information about the racial identity of their students would violate our free exercise. If the NAACP cannot be required to disclose the identity of its members consistent with the First Amendment, NAACP v. Alabama, 357 U.S. 449 (1958), our Christian schools cannot be required to disclose the identity of their students consistent with the First Amendment's protection of religious exercise.

Abridgment by chilling other religious exercise

D. Beyond the effect of this Proposed Revenue Procedure on our Christian schools, the impending extension of this Revenue Procedure to our churches would contravene our free exercise of religion. If government can deny a tax exemption to our Christian schools, it apparently can deny that tax exemption to our churches. What logical principle prevents the IRS from denying tax exemption to a church if it grew significantly at the time of public school desegregation and if it has a small number of minority members?

In summary, revoking the tax exemption of our Christian school would abridge our free exercise of religion; threatening revocation of that tax exemption would chill our religious freedom; and imposing the Revenue Procedure's unreasonable requirements would hinder our religious exercise.

II. THE PROPOSED REVENUE PROCEDURE WOULD ABRIDGE OUR PROTECTION FROM
STATE ESTABLISHMENT

The First Amendment also prohibits establishment of religion by government. This establishment clause prohibits interference with internal church activities. See Serbian Eastern Orthodox Diocese v. Millivojevich, 426 U.S. 696, 709-10 1976); Presbyterian Church v. Hull Memorial Presbyterian Church, 393 U.S. 440, 449 (1969); Kedroff v. St. Nicholas Cathedral, 344 U.S. 94 (1952). Our Christian school is an integral part of our church as explained above. Interference with the administration of our Christian school by threatening our tax exemption constitutes interference with internal church activities and violates the establishment clause. See Hinton v. Kentucky State Board of Education, Civ. No. 88314 (Ky. Cir. Ct. Oct. 4, 1978) (holding burdensome regulation of Christian Schools violates establishment clause); State v. Whisner, 47 Ohio St. 2d 181, 351 N.E. 2d 750 (1976) (same).

Moreover, the establishment clause prohibits government hostility to a religion. Abington School District v. Schempp, 374 U.S. 203, 306 (1963) (no hostility to religion); Zorach v. Clauson, 343 U.S. 306, 314 (1952) (no preference to nonbelievers over believers); Everson v. Board of Education, 330 U.S. 1, 18 (1947) (no governmental adversity to religion). The intrusive and unreasonable nature of this Proposed Revenue Procedure would be tantamount to a governmental declaration of war on Christian schools. That hostility to our church and its Christian school would violate the establishment clause.

III. THE PROPOSED REVENUE PROCEDURE WOULD CHILL OUR RIGHTS TO RELIGIOUS FREEDOM AND DUE PROCESS BY UNRESTRICTED AGENCY DISCRETION

The First Amendment prohibits unrestricted governmental discretion over exercise of religion or speech. Fowler v. Rhode Island, 345 U.S. 67 (1953); Kunz

v. New York, 340 U.S. 290 (1951); Niemotko v. Maryland, 340 U.S. 268 (1951); Martin v. City of Struthers, 319 U.S. 141 (1943); Murdock v. Pennsylvania, 319 U.S. 105 (1943); Largent v. Texas, 318 U.S. 418 (1943); Jamison v. Texas, 318 U.S. 413 (1943). The Proposed Revenue Procedure would abridge free religious exercise and free speech by unchecked discretion given to the Internal Revenue Service over exercise of those rights.

Unchecked discretion over burden of initial proof of discrimination

A. The Proposed Revenue Procedure would give the IRS arbitrary power to disregard a Christian school's evidence of nondiscriminatory policy. It states: "If there is any evidence that a school in fact has a racially discriminatory policy or practice the Service may find that the school is not entitled to exemption *** without regard to whether the school has complied with the guidelines set forth in this revenue procedure." Sec. 2.05 (emphasis added). The proposed rule does not specify any minimum of evidence of discrimination needed for the IRS to disregard of a school's proof of nondiscrimination, and some amount of evidence of discrimination (however untrue that evidence is) can readily be found against any public or private school in the country.

Unchecked discretion over definition of relevant desegregation time

B. The proposed Revenue Procedure fails to define the term "the time of desegregation of public schools," sec. 4.02, and so enables the IRS to apply this presumption of discrimination and this burden of rebuttal to virtually any nonpublic school. Nearly every private school has been "formed or substantially expanded" at some point within the past twenty-four years and the time of desegregation of public schools" easily could be set at the time of the Brown v. Board decision in 1954, the time of implementation of a freedom of choice plan, the time of filing of a civil rights suit against the public schools, the time of an order of filing desegregation plans, the time of transfer of teachers between schools, the time of actual transfer of students between schools, or nearly any subsequent time.

Unchecked discretion over definition of relevant community

C. The Proposed Revenue Procedure defines the term "community" (which is used to determine the minimal minority enrollment necessary) to embrace any public school district from which over five percent of the Christian school's students come, sec. 3.06, and this hinders expansion and religious activities of Christian schools that are near to metropolitan areas with a high minority population as explained above.

IV. PROPOSED REVENUE PROCEDURE WOULD VIOLATE OUR RIGHT TO DUE PROCESS, BY AN UNREASONABLE BURDEN OF PROOF

The Fourteenth Amendment assures due process of law. Where a government requirement impairs a fundamental right such as religious freedom, due process requires government to have a compelling interest in its requirement rather than merely a reasonable basis for its demand. E.g., United States v. Carolene Products Co., 304 U.S. 144, 149 N. 4 (1938). The extreme burden of proof required for Christian schools to rebut the presumption of a discriminatory purpose, in order to preserve their tax exemptions, manifestly is not required by a compelling state interest and instead is simply unreasonable.

Unreasonable presumption of guilt

A. The burden of proof in the Proposed Revenue Procedure effectively would hold Christian schools guilty until proven innocent. When the I.R.S. merely showed that a Christian school was substantially expanded or formed at about the time of public school desegregation, or that the school has an insufficient number of minority students, the Proposed Revenue Procedure would compel the Christian school to prove not just neutral treatment of minority applicants and white applicants (which is at issue), but also "affirmative steps to secure minority students," sec. 4.02. And this would require either that the percentage of minority students in the Christian school is at least twenty percent of their percentage of the population-even if not that many minority students apply and if minority applicants receive identical treatment as white applicants-or else that affirmative action favoring minority groups is implemented for scholarships, financial assistance, employment positions, advertising, recruitment, and curriculum-even if no affirmative action favoring whites had been practiced.