Third Circuit Upholds District Court Decision in Pennsylvania Baptist Church Sign Case

Last week, the Third Circuit Court of Appeals entered an order upholding the district court’s decision in the case of Tearpock-Martini v. Shickshinny Borough, which we reported on last summer.  The case involved an Establishment Clause challenge by a citizen to a Pennsylvania borough’s decision to install a sign in the right-of-way stating “Bible Baptist Church Welcomes You!”  The district court found, on a motion for summary judgment, that the sign did not violate the three-part Lemon test under the Establishment Clause, and that it did not violate the endorsement of religion test.

The Third Circuit found the plaintiff’s arguments regarding the posting of other signs in the right-of-way unconvincing.  The plaintiff made much of the fact that the only other sign in borough right-of-way was a directional sign to a boat launch, and that the borough had not permitted a post office sign in the right-of-way.  But the Third Circuit noted that the post office never applied for a sign in the right-of-way, and further pointed out that the borough’s approval and subsequent installation of the church sign did not send a message of endorsement.

Tearpock-Martini v. Shickshinny Borough, ___ Fed. App’x ___, 2017 WL 35714 (3d Cir. Jan. 4, 2017).

*The following is re-posted with permission of Rocky Mountain Sign Law Blog, available at: http://www.rockymountainsignlaw.com/.  Brian J. Connolly and Otten, Johnson, Robinson, Neff + Ragonetti are not affiliated with Robinson + Cole, LLP.

Missouri Church Wins Digital Sign Appeal

The Missouri Court of Appeals has ruled that the Kansas City, Missouri, Board of Adjustment abused its discretion in failing to grant a variance to Antioch Community Church (Church) to install digital components into its monument sign.  The Church argued that absent the variance it had practical difficulty in communicating its message.  In the alternative, the Church contended that the zoning code violated the First Amendment “by favoring less-protected commercial speech over more-protected non-commercial speech.”  Under the code, schools and churches on lots 15 acres or more (or 10 acres or more if located on a major arterial road) are allowed to use digital signs.  Because the Church’s lot was less than 10 acres, the code prohibited it from having a digital sign on its property.

The Church property is in a single-family residence zone next to commercial, urban residential, downtown, and industrial zones, all of which permit digital signs.  The Church is located on Antioch Road, a four-land roadway with about 14,000 travelers each day.  Since 1956, the Church has had a monument sign consisting of glass display cases surrounded by brick framework.  The sign included messages and information about Church activities that were manually  added using letters hung from cup hooks.  In 2010, at a cost of $11,000, the Church installed a digital sign, which replaced the display case, but no changes were made to the brick surround.  At this time, the Church was unaware that the Kansas City sign ordinance prohibited digital signs in residential zones (Section 88-445-06-A-4 of the code).  Accordingly, the Church did not seek a variance before installing the digital sign component.

About a year later, the City issued a notice of violation to the Church for installing the digital component without seeking a variance.  The Church then sought and was denied a variance.  Its local appeal of the Board’s decision was also denied.  Following this local process, the Church sued in Clay County Circuit Court.  The Circuit Court entered judgment in favor of the Church and ordered the issuance of the variance, but did not address the Church’s constitutional claim finding it to be moot.

The Missouri Court of Appeals affirmed the Circuit Court’s decision that the Church was entitled to the variance.  First, the Court of Appeals rejected the Board’s assertion that it had no authority to issue a variance as to the “type” of sign under the code.  Section 88-445-12 of the code states: “The Board of Zoning Adjustment may grant variances to the requirement for signs, except as to the type and number.”  (emphasis added).  But a “digital sign” is a “component” of a sign (Section 88-810) – not a sign “type.”  Rather, Section 88-445-12 defines “sign type” as:

A group or class of signs that are regulated, allowed, or not allowed in this code as a group or class.  Sign types include, but are not limited to, pole signs, monument signs, oversized monument signs, outdoor advertising signs, wall signs, projecting signs, roof signs, ornamental tower signs, electronic or digital or motorized signs, banner signs, and temporary signs.

As found by the Court of Appeals, the monument sign which had been there since 1956 was the “sign type,” so the Board had authority to grant a variance to permit a digital component for a monument sign.

The Court of Appeals also found that the Church had proven practical difficulty warranting issuance of the variance: (a) the variation was not substantial; (b) the sign does not effect a substantial change to the character of the neighborhood; and (c) the Church lacks other means of advertising or communication, such as fliers or paid advertisement.  Like the Circuit Court, the Court of Appeals did not address the Church’s claim that the code violated the First Amendment by favoring commercial speech above non-commercial speech.

The decision in Antioch Community Church v. Board of Zoning Adjustment of the City of Kansas City, Missouri (2016) is available here.

DOJ Claims that County’s Denial of a Sewer Permit Violates RLUIPA

sweet spetic

Guest Post by Derek Valentine

Earlier this month, the U.S. Justice Department (“DOJ”) filed suit in District Court for the Western District of Virginia against the Culpeper County Virginia Board of Supervisors alleging it acted in a discriminatory manor by denying a permanent pump and haul septic system permit for a proposed mosque.

The Islamic Center of Culpeper (ICC) is a non-profit Muslim center that began its formal search for a permanent mosque location in 2011. In January of 2016, the ICC located a property that met its qualifications and entered into a purchase contract. The one-acre property included a dilapidated structure that would be razed to make way for a small mosque to serve the ICC’s needs for the next ten years. The new facility would accommodate separate prayer rooms for male and female congregants, classrooms for Arabic language studies, and a proper space to allow congregants to perform a pre-prayer ritual requiring the washing of hands and feet.

After entering into the purchase contract, Mohammed Nawabe, ICC’s Director, contacted the County Administrator to initiate construction approvals. The property is located in a zoning district that allows religious land uses by right, but the County Administrator recommended that Mr. Nawabe contact the health department regarding soil conditions and the ability to accommodate an on-site septic system. Mr. Nawabe was subsequently informed by the health department that the property would not support a traditional septic system and instead would have to rely on a permanent pump and haul system, requiring approval from the County. A permanent pump and haul system is out of the ordinary and is required where there is no public sewer service and soil conditions do not allow a conventional on-site septic system.  Instead, the sewage must be retained in a tank and periodically hauled away by truck.  Under Virginia  law this requires a special permit from the state, and in this case the county holds the only permit in the county and thus must approve such systems to be added to its permit.

The ICC submitted an application for pump and haul approval but, according to the complaint, was met with considerable interference from a local civic leader. At one point, ICC’s application was pulled from a meeting agenda and was deferred to the County Attorney for additional review. Mr. Nawabe then met with the County Planning Director and was told he needed to reapply with an updated County pump and haul agreement because he mistakenly was given an outdated copy.

The ICC’s application was resubmitted on March 3, 2016, and scheduled for County Board consideration on April 5, 2016. The DOJ claims that in the intervening time between the submission and the scheduled Board action date, the County received a barrage of emails and phone calls from constituents urging denial of the application. Many of the comments relayed anti-Muslin sentiments. The County Administrator informed the County Board Chairwoman that the ICC application should be reviewed consistent with the established criteria and level of scrutiny applied to all other applications. The Administrator stated that he would be prepared to invalidate any irrelevant constituent concerns at the scheduled Board meeting.

At the April 5th meeting, the County Administrator shared prepared comments indicating that the ICC had “provided letters from the health department “saying that the soil just wouldn’t support what they would consider a traditional type of drain field, and no other alternative was identified.” After some discussion from County Supervisors, the application was denied on a 4-to-3 vote. According to the complaint, of the 26 applications processed in the last 20 years this was only the second denial  . The County Supervisors who voted against the application argued that ICC did not show hardship and that pump and haul permits were for emergency use only and not intended for commercial or church use. These Supervisors also denied the hardship claim because ICC did not own the property at the time of the application and there was no existing structure on the property. Furthermore, they alleged that ICC purchased the property at a below market price because of the preexisting poor soil conditions and inferred that any hardship would be deemed self-inflicted. However, the DOJ concluded that permits were issued to other parties under very similar circumstances, including one to a Baptist church.

The DOJ alleges that the County has used the permit process to allow land uses it finds desirable while excluding unwanted land uses. The allegations state that the County’s denial constituted “a substantial burden on ICC’s freedom to practice their religion” and that ICC’s permit was treated substantially differently than similar permit applications. The  complaint requests injunctive relief requiring the County to issue the permits necessary for ICC to construct the mosque and requiring the County to provide RLUIPA training, establish a protocol to address future RLUIPA claims, and maintain records/reports with respect to RLUIPA compliance.

The complaint in United States of America v. County of Culpeper, VA is available here.

Original Photograph by Laura Gilmore, some rights reserved.

Port Jervis, NY Sued by DOJ; Settles Two Days Later

The City of Port Jervis, New York has agreed to settle a federal lawsuit filed by the United States Department of Justice (DOJ) alleging that the City’s revision to its zoning code violated the Religious Land Use & Institutionalized Persons Act (RLUIPA).  In August 2015, Goodwill Evangelical Presbyterian Church (Church) finalized a contract to purchase property in the City’s Central Business District (CBD), where a place of worship was a permitted use.  Four months later, the City revised its zoning code to bar “places of worship and related facilities” in the CBD and the Service Commercial District.

The zoning code revision (known as Local Law No. 7) was intended to allow a local brewery called Fox N Hare Brewing Co. to purchase and operate on property near to where the Church sought to locate.  Under New York State’s Alcoholic Beverage Control laws,  no license may issue for on-premises liquor consumption “on the same street or avenue and within two hundred feet of a building occupied exclusively as a school, church, synagogue or other place of worship.”  This meant that if the Church operated from the property it sought to purchase, the brewery would have to go elsewhere.

Local Law No. 7 contains a “Legislative Findings and Intent” Section providing that “places of worship may have a detrimental effect on business, commercial[,] and community development” in the subject zoning districts and states that, due to “the restrictions set forth for liquor licenses for restaurants, breweries, micro-breweries, micro-distilleries, pubs and other eating and drinking establishments commonly located within the Central Business Zoning District and Service Commercial Zoning District of the City, as set forth in the Alcoholic Beverage Control Legislation of the State of New York, places of worship and related facilities may deter and prohibit the location and expansion of business and commercial uses within the Central Business Zoning District and Service Commercial Zoning District in the City.” While Local Law No. 7 banned places of worship it also allowed uses that had previously been prohibited: microbreweries, brew pubs, breweries, microdistilleries, distilleries, wineries, and tasting rooms.  After Local Law No. 7 passed,  the Church voided its  contract to purchase the property.

The DOJ sued alleging violations of RLUIPA’s equal terms and substantial burden provisions.  According to the DOJ, the City’s zoning code on its face violated the equal terms provision because it banned religious uses but at the same time permitted analogous, secular assembly uses in the same zone, including clubs, fraternal organizations, nonprofit membership clubs, libraries, gyms, art galleries, museums, preschools, day-care centers, and nursery schools.  The DOJ alleged that the City violated the substantial burden provision because prior to Local Law No. 7 the Church had the reasonable expectation that it could use the property as a place of worship.  But the revision to the zoning code caused the Church to suffer delay, uncertainty, and expense with respect to its intended use of the property.

Two days after filing suit, the City and the DOJ agreed to settle the case by consent decree filed with the court.  Under the decree, the City has sixty days to repeal Local Law No. 7.  Further, within 180 days, the City must provide RLUIPA training to its mayor, each member of the Common Council, and all building and code enforcement officers.  The last requirement of note is that the City must maintain copies of all religious land use applications and provide copies of same to the DOJ within fifteen days following disposition of such applications.  The same applies for any religious discrimination complaints; that is, the City must notify the DOJ of any such complaints within fifteen days after receipt of complaint.  The consent decree in United States of America v. City of Port Jervis, No. 15 Civ. 9026 (S.D.N.Y. 2016) is available here.

Although the DOJ believed the zoning code revision in this case created an equal terms issue by treating secular assembly uses differently from religious uses, it is important to remember that, after careful evaluation of a city’s land use goals, it may be permissible to exclude religious uses from a downtown or economic development zone.  In Lighthouse Inst. for Evangelism, Inc. v. City of Long Branch, 510 F.3d 253 (3d Cir. 2007), the Third Circuit upheld a limitation on religious uses in a city’s redevelopment zone after assessing its regulatory purpose: “[s]trengthening retail trade and City revenues, increase[ing] employment opportunities, and attracting more retail service enterprises” to “encourage a vibrant and vital downtown residential community centered on a core sustainable retail main street.”  Id. at 2.

RLUIPA Round-Up: Happy Cyber Monday

cyber monday

Guest Post by Derek Valentine

Take a break from the sales and give the Round-Up a read:

  • ABC Channel 9 in Sioux City reports on a US Justice Department inquiry into the proposed siting of Our Savior Lutheran Church in a former Budweiser warehouse in the City of Norfolk, Nebraska. The City maintains that churches are not allowed in industrial zones and fears that the church would be in conflict with existing industrial uses in the area. The Church is frustrated that the City refuses to engage in a dialogue. The City has 30 days to submit the details of basis for the zoning denial for review by the US Justice Department.
  • In Bucks County, Pennsylvania, a federal judge has upheld a discrimination lawsuit filed by the US Department of Justice against the Township of Bensalem, denying the Township’s motion to dismiss the case. Philly Voice reports that Bensalem Masjid was denied a variance to construct a mosque on parcels zoned for residential and business professional uses, citing concerns about the size of the mosque, parking, and membership growth. Bensalem Masjid responded by reducing the size of the project, adding parking, and offering a Friday afternoon prayer service. The US Department of Justice alleges that variance requests were approved for various other religious institutions, but not for Bensalem Masjid.
  • In rural San Martin, California, some residents are outraged over a proposed 105,546 square-foot mosque, as reported by the Daily Intelligencer. The mosque is proposed in a “Special Plan Area,” which was instituted to limit development and preserve agriculture and rural character. Those opposing the mosque are concerned about groundwater contamination from a “green cemetery” and question whether the use is “local serving” as mandated by the ordinance.
  • Church leaders and village officials are going head-to-head in Antioch, Illinois, reports the Daily Herald. Saint Ignatius Episcopal Church is operating a resale shop that the Village claims is not consistent with the residential zoning in the neighborhood. The Village has filed an injunction arguing that in addition to zoning noncompliance, the facility has inadequate handicapped-accessible restrooms. The Church points to a 60 year-old agreement between the Church and the Village stating that all buildings on the 5.1-acre parcel are part of the overall ministry, and not subject to the zoning use restrictions.
  • A group of churches filed suit against Massachusetts officials based on the enforcement of the public accommodation law. The law, as interpreted by the Massachusetts Commission Against Discrimination and Attorney General Maura Healy requires the churches to allow the use of bathrooms and other “intimate areas” based on gender identity and not biological sex.

Original photo by Taryn Domingossome rights reserved.

Rocky Mountain Sign Law Blog: Installation of Ten Commandments On City Hall Lawn is Government Speech, Violates First Amendment

Original Photography by George Bannister (Licensed)

Guest Post by Brian Connolly, Otten Johnson, PC

Earlier this month, the Tenth Circuit Court of Appeals ruled that Bloomfield, New Mexico’s installation of a Ten Commandments monument on the lawn in front of city hall violated the Establishment Clause of the First Amendment.

In 2007, upon request of one of its members, the Bloomfield city council approved the placement of the privately-donated monument.  At the time, the city lacked a policy regarding placement of permanent monuments, but it enacted one three months later.  The city’s policy required a statement to be placed on privately-donated stating that the speech was not that of the city but rather of the donor, and also required that such monuments relate to the city’s history and heritage.  After several years of fundraising and another city council approval, the 3,400 pound Ten Commandments monument was placed on the city hall lawn in 2011, and the city held a ceremony—replete with statements by elected officials and religious leaders—to dedicate the monument.  Over the course of the next two years, the city amended the monument policy, and allowed the installation of other monuments on the lawn, including monuments containing the Declaration of Independence, the Gettysburg Address, and the Bill of Rights, but did not advertise its policy of allowing donated monuments.

The federal district court held that the plaintiffs had standing to challenge the city’s action in placing the monument, found that the monument constituted government speech, and held the placement of the monument to be a violation of the Establishment Clause.  The Tenth Circuit affirmed the district court’s decision.

With respect to the city’s challenge to the plaintiffs’ standing, the appeals court reiterated that “direct contact” with the Ten Commandments monument was all that was required for the plaintiffs to establish injury.  The court went on to find, over the city’s arguments to the contrary, that the Ten Commandments monument constituted government speech and was therefore subject to Establishment Clause limitations.  While the city disputed the monument’s permanence—arguing that, despite its size, it could be removed by a construction crew—the court instead found that the monument was permanent and therefore constituted government speech under the Supreme Court’s decision in Pleasant Grove City v. Summum.

Moving to the three-part Establishment Clause analysis established by Lemon v. Kurtzman, the court concluded that the monument violated the First Amendment because the monument had the effect of endorsing particular religious beliefs.  According to the court, the Ten Commandments are a religious text, the monument was prominently placed in front of the principal government building in the city, and the circumstances of the monument’s placement suggested a religious motivation on the city’s part.  In so holding, the court found that the required disclaimer message on the monument did not change the analysis that a reasonable observer would believe the monument to be the city’s speech and endorsement of religion, and further that the placement of secular monuments on the city hall lawn did not negate the religious endorsement effected by the Ten Commandments monument.

Despite the Tenth Circuit’s ruling, last week, several members of the Bloomfield community spoke out in favor of the Ten Commandments monument at a city council meeting.  The city is considering filing a petition for writ of certiorari in the Supreme Court.

Felix v. City of Bloomfield, ___ F.3d ___, 2016 WL 6634870 (10th Cir. Nov. 9, 2016).

Original Photography by George Bannister, Licensed

Facial RLUIPA Claims Against Mobile, AL Dismissed

meditation

Guest Post by Tavo T. True-Alcala

Earlier this year, the Thai Meditation Association of Alabama and several individual plaintiffs (“the Center”) filed suit against the City of Mobile, Alabama (“the City”), alleging that the denial of its application to operate a meditation center in a residential area was a violation of its rights under RLUIPA on three counts. Specifically, the complaint claims that the City of Mobile’s Zoning Ordinance, both on its face and as applied, violates the Center’s rights as a religious institution by substantially burdening its religious exercise, discriminating on the basis of religion, and treating it on less than equal terms. The complaint also alleges that the Center was misled by City officials when it was encouraged to apply for a planning use approval, which is the appropriate zoning relief for religious organizations seeking to locate in a residential zone, rather than a use variance which is required for  commercial uses in residential zones. The City denied the Center’s application because it ultimately concluded that the Center’s proposal was for a commercial, not religious, use. Further details of this case can be found in our previous post.  Most recently, the court decided the City’s Motion to Dismiss, granting the dismissal of the Center’s facial RLUIPA claims, but denying its request to dismiss the claim of negligent misrepresentation.

The City claimed that the facial challenges presented in the Center’s complaint are not supported by any reference to specific provisions of the Zoning Ordinance that allegedly violate RLUIPA on their face. According to the City, the Zoning Ordinance is, on its face, neutral, and “does not discriminate between similar religious and non-religious entities or uses, and does not place a ‘substantial burden’ on Plaintiffs’ religious exercise,” and therefore contended that the facial allegations should be dismissed. The City further averred that as the Center knew its anticipated use was subject to City approval, and that this knowledge precludes a claim of misrepresentation, whether or not the application was denied.

On October 12, an Alabama federal magistrate judge issued a report recommending that the City’s motion be granted as to all facial claims, but denied as to the claim of negligent misrepresentation.  In considering the facial challenges, the magistrate judge found that the Zoning Ordinance does not on its face infringe upon the rights of any religious organization by imposing a substantial burden on religious exercise, discriminating on the basis of religion, or causing unequal treatment.   The magistrate judge further distinguished facial and as applied claims by reasoning that including the specific instance of the denial of the Center’s application in the consideration of the facial challenges “would risk emptying the ‘as-applied’ challenge of its meaning.”

While the motion to dismiss the facial challenges was granted, the magistrate judge did not recommend dismissal of the negligent misrepresentation claim. The City argued that the Center could not have relied on the staff representations since it still required City approval of its intended use. The magistrate judge disagreed, finding  persuasive the Center’s allegation that it relied on misrepresented information to determine that the planning approval process was appropriate, rather than the variance use process.

After due and careful consideration, the district judge ordered the recommendations be adopted, granting the dismissal of the facial challenges but denying the dismissal of the negligent misrepresentation challenge.

Original Photo by Moyan Brenn, some rights reserved.

$1.7 Million Settlement with DOJ and CAIR-MI

Original photograph by Anthony Easton, some rights reserved. https://www.flickr.com/photos/pinkmoose/

In 2011, Pittsfield Charter Township denied, allegedly without deliberation, Michigan Islamic Academy’s (“MIA”) application to rezone a 26 acre parcel (the “Property”) to allow the development of  a pre-K through grade 12 school.  MIA then sued the Township, alleging that the denial substantially burdened its religious exercise.  At the time, MIA operated a school in nearby Ann Arbor, but such facilities were overcrowded and MIA was forced to use on-site trailers to accommodate its 190 students.  As we reported last November, MIA’s lawsuit was dismissed because, according to the District Court for the Eastern District of Michigan, MIA did not have a sufficient property interest to maintain its RLUIPA claims because it never acquired a legally cognizable property interest in accordance with Michigan law.

After the dismissal, both the Department of Justice (“DOJ”) and the Michigan chapter of the Council on American- Islamic Relations (“CAIR”) filed separate lawsuits on behalf of MIA.

The DOJ described the settlement:

As part of the settlement, the township has agreed to permit MIA to construct a school on the vacant parcel of land, to treat the school and all other religious groups equally and to publicize its non-discrimination policies and practices.  The township also agreed that its leaders and various township employees will attend training on the requirements of RLUIPA.  In addition, the county will report periodically to the Justice Department.  In the separate settlement between MIA and the township, Pittsfield agreed to pay $1.7 million to resolve MIA’s claims for damages and attorney’s fees caused by the 2011 denial and the resulting delay in construction of the school.

In addition to the $1.7 million payment, MIA received the right to build a 70,000 square foot Islamic school, a residential development consisting of 22  duplex  units  and three single family homes, and a park. CAIR-MI’s press release regarding the settlement is available here.

Original photograph by Anthony Easton, some rights reserved.

Landmarking designation is alleged to violate RLUIPA

Guest Post by Tavo T. True-Alcala

A brewing dispute in Yonkers, NY has led the Islamic Community Center for Mid Westchester (ICCMW) to allege that Yonkers violated ICCMW’s rights under RLUIPA, and the First and Fourteenth Amendments of the United States Constitution.  The controversy began in the summer of 2015 when ICCMW submitted an application to undertake certain renovations at a property it owns within a residential district.  According to the complaint, the renovations are necessary so it can operate the property as a Mosque.  ICCMW, however, claims that it is now prevented from making necessary repairs because the City, after a petition by the Colonial Heights Association of Tax Payers (CHAT), designated the property as a historic landmark.  ICCMW now seeks a preliminary injunction “declaring the landmark designation discriminatory and void.”

ICCMW claims that it was opposed at every turn by CHAT, a group of local residents who had allegedly opposed similar religious projects in the past.  ICCMW argues that CHAT’s actions were motivated by prejudice and that, since a Mosque is a permitted use, CHAT settled on historic landmark designation as the way to force ICCMW to look elsewhere.  CHAT’s initial application was deemed insufficient, and ICCMW believes that even the approved application fails to establish that the property meets even one of the four historic designation criteria, which are that a building must:  be associated with persons or events of historic significance; be illustrative of historic growth and development; embody distinctive characteristics or be the work of a master; or contain unique architectural, archaeological, or artistic qualities.

In its request for injunctive relief, ICCMW reviews these criteria, and explains why its property does not meet any of the above standards.  It contends that the designation of its house based on reasons other than those legally allowed is no more than a pretext to accomplish a prejudiced and discriminatory agenda.

The obvious question presented by ICCMW’s petition is whether its request for relief is ripe—ICCMW has not applied to the City’s Landmark Preservation Board for a certificate of appropriateness to conduct the repairs and renovations it deems necessary for Mosque operations.  Addressing this point, ICCMW states:  “The landmark designation restricts ICCMW’s free will to construct and have a house of worship bearing all characteristics of a Mosque of their choice, either presently or in the future.  It curtails their ability to renovate the property.  The Muslim population in Colonial Heights has grown, and they have no house of worship nearby, hence the demand for a Mosque in Colonial Heights is ripe.”

This NBC News article about the case includes a photograph of ICCMW’s Yonkers property.

Nashville Islamic Center Claims Tax Rules Impose Unfair Burden

Nashville
Guest Post by Tavo T. True-Alcala

The Islamic Center of Nashville (ICN) recently filed a federal complaint and request for declaratory judgment against the State of Tennessee, the Metropolitan Trustee of Nashville, and the Tennessee State Board of Equalization after it was denied a request for retroactive property tax relief.

Since 1995, ICN has operated a religious school, the Nashville International Academy (NIA), an independently operating but related entity. To finance a new educational building, while still adhering to the Islamic tenet against interest-bearing loans, ICN entered into an Ijara agreement through which an entity related to Devon Bank held the property’s title until payments on the finance agreement were complete. The agreement lasted from August 2008 until October 2013, during which time ICN and NIA exclusively operated on the property, with no oversight by Devon Bank or its related entities. During this time no taxes were paid by the Bank or its related entities on the property, nor did it take any depreciation on the property for tax purposes.

In February 2014 ICN applied for a property tax exemption for the building, to be applied retroactively, seeking continuity of exempt status as provided by Tenn. Code Ann. 67-5-212(b)(3)(B). The tax exempt status was denied for the period prior to October 2013, when the Ijara payments were ongoing, but granted from that time onward. ICN appealed the decision before an Administrative Law Judge (ALJ) in January 2015, and after receiving an unfavorable ruling, appealed again to the Tennessee Assessment Appeals Committee, which also found that ICN was not entitled to the exemption prior to October 2013 due to the transfer of property in the Ijara agreement. Despite the adverse rulings, the ALJ and Appeals Committee expressed some degree of sympathy with ICN and discomfort that the law did not accommodate the religious need for Ijara agreements.

ICN contends that its refusal to pay interest is the sole reason it lost its tax exempt status, which it claims has done it harm by restricting its ability to develop property and develop other educational services. ICN’s complaint, available here, alleges violations of the Religious Freedom and Restoration Act (RFRA), its Tennessee counterpart, RLUIPA, state law,  and the First Amendment of the United States Constitution.

With regard to RLUIPA, ICN claims that the defendants favor non-Islamic religions and non-religious organizations, substantially burdening ICN, without a valid compelling governmental interest as justification. Furthermore, the denial penalizes ICN’s adherence to sincerely held religious tenets, thus violating its right to religious expression and religious exercise as required by RLUIPA.  ICN also contends that the laws of Tennessee, as applied to ICN, violate the Establishment clause’s purpose of “insur[ing] that no religion be sponsored or favored, none commanded, and none inhibited.” ICN is seeking a Declaratory Judgment that its actions are in accordance with the law as a religious institution by practicing the tenets of its religious faith.

Original photo by Brent Mooresome rights reserved.

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