WASHINGTON, May 12 (AP) -- The Internal Revenue Service was justified in revoking the
tax-exempt status of a small New York church that opposed President
Clinton's 1992 candidacy, a federal appeals court ruled Friday.
The unanimous ruling said the revocation -- history's first stripping of a
church's tax exemption for political activity -- "neither violated the
Constitution nor exceeded the IRS' statutory authority."
Lawyers for the Church at Pierce Creek, in the Binghamton, N.Y., area, had
argued that the tax agency had exceeded its authority, violated the church's
free-speech rights and engaged in selective prosecution.
"These objections are without merit," a three-judge panel of the U.S.
Circuit Court of Appeals for the District of Columbia concluded.
Federal tax law exempts churches and other charitable organizations from
taxation provided they do not engage in certain activities, including any
political campaign on behalf of or in opposition to any candidate for public
The Rev. Barry Lynn, executive director of Americans United for Separation
of Church and State, said the ruling "slams the door on mixing religion and
"This is a staggering defeat for Pat Robertson, Jerry Falwell and others
who want to convert America's churches into a partisan political machine,"
Lynn said. "In light of this ruling, pastors who allow partisan politicking
in the sanctuary are jeopardizing their church's tax exemption."
It was the Friday before Election Day in 1992 when the Church at Pierce
Creek and its pastor, Daniel J. Little, bought a full-page advertisement in
two newspapers urging voters to reject Democratic presidential nominee Bill
Clinton because of his positions on abortion, homosexuality and the
distribution of condoms in public schools.
The "Christians Beware" ad appeared in USA Today and The Washington Times.
Americans United for Separation of Church and State subsequently filed a
complaint with the federal tax agency.
After an investigation, the IRS revoked the church's tax-exempt status in
1995, action held in abeyance during the legal fight. A federal judge upheld
the revocation last year, and Friday's decision agreed with his reasoning.
The appeals court's decision focused most closely on the church's
free-speech claims, but rejected them as exaggerated.
"The church asserts first, that a revocation would threaten its existence
... that a loss of its tax-exempt status will not only make its members
reluctant to contribute the funds essential to its survival but may obligate
the church itself to pay taxes," Judge James Buckley wrote for the panel.
"In actual fact, even this burden is overstated ... As the IRS confirmed in
oral argument, if the church does not intervene in future political
campaigns it may hold itself out as a (tax-exempt) organization and receive
all the benefits of that status," he said.
Buckley's opinion also noted that churches can form separate, non-exempt
entities "for the promotion of social welfare," and that those
organizations can form political action committees to participate in
The New York church is represented by the Robertson-founded American Center
for Law and Justice.
"While we are disappointed with the ... case involving the Church at Pierce
Creek, we are encouraged that this court appears to provide a blueprint for
churches to express their beliefs in a political context," ACLJ chief
counsel Jay Sekulow said. "This is an important development in the area of
protecting the First Amendment rights."
Sekulow said his group had not yet decided whether it will appeal the case
to the Supreme Court.
The case is Branch Ministries vs. Rossotti, 99-5097.