A federal court has issued another decision in the longstanding RLUIPA battle between the City of Upper Arlington, Ohio (“City”) and Tree of Life Christian Schools (“TLC”).  For a second time, a federal court in the Southern District of Ohio has ruled that the City did not violate RLUIPA’s equal terms provision by prohibiting religious schools in its ORC Office and Research District (“ORC District”).

The dispute began in 2011 when TLC purchased property in the ORC District to develop as a private religious school.  The only problem for TLC – schools are not permitted in the ORC District, a district of special importance to the City, as 95% of the City is devoted to residential use and only about 5% to commercial use.  As such, one of the primary regulatory purposes of the ORC District is to maximize revenue for the City (particularly through taxes), given the scarcity of commercial land.  Complicating matters for TLC was that the land it purchased and sought to develop as a school was previously occupied by AOL/Time Warner and generated substantial tax revenues for the City (accounting for 29% of the City’s income tax revenues in 2001).

We have reported about the extensive history of this case here, here, and here, including two decisions by the United States Court of Appeals for the Sixth Circuit.  The Sixth Circuit most recently remanded the case back to the district court to consider the following issues:

  • Are there nonreligious assemblies or institutions to which the court should compare Tree of Life Christian Schools because they would fail to maximize income-tax revenue?
  • If so, would those assemblies or institutions be treated equally to Tree of Life Christian Schools?

On remand, TLC argued that there are two “comparator” uses that are allowed in the ORC District but generate less income-tax revenue for the City: (a) daycares, and (b) “partial office uses.”  According to TLC, this meant that the City’s ban of private religious schools in the ORC District violated RLUIPA’s equal terms provision.  The Court disagreed.

First, the district court found that daycares were not proper comparators because they would generate more income tax revenue for the City than TLC’s school would generate.  Second, the district court considered TLC’s argument that a “partial office use” was a valid comparator.  TLC claimed that a business could purchase a building the size of the property that TLC purchased, but could use only part of it, staff it with few employees, and generate less income tax revenue for the City.  The district court rejected the partial office use comparator, because:

“if a partial use is accepted as a valid comparator, then there can never be a case in which a city with the goal of maximizing revenue could ever prevail.  A city can set forth the regulatory purpose, but a city cannot demand full use of a property to realize that purpose.  Therefore, for purposes of the analysis of similar comparators, the Court finds it should look to the comparison of the full use of one assembly or institution compared to the full use of another type of assembly or institution.”

The district court’s decision is worth the read for its consideration of the different equal terms tests employed by different Circuits.  While the City ultimately prevailed, this case is an example of the time-consuming, and costly, litigation that can ensue when a municipality is sued under the RLUIPA statute.

The decision in Tree of Life Christian Schools v. City of Upper Arlington (S.D. Ohio 2017), is available here.