The good news of innerchange.

• Author: Picarello, Anthony R., Jr.

INTRODUCTION

In his recent article, attorney Alex Luchenitser relates his view of the facts of the case in Americans United for Separation of Church dr State v. Prison Fellowship Ministries, (1) summing them up as a "cautionary tale" that should counsel against any future use of the "faith-based-prison-unit model" of rehabilitation programming. (2) Instead, the decision of the Court of Appeals for the Eighth Circuit in that case should be read as charting a course forward under the Establishment Clause for units of precisely this type, and making clear that there remains substantial room for them within constitutional boundaries.

To be sure, the Eighth Circuit affirmed the core decision below that the particular version of the InnerChange Freedom Initiative ("InnerChange') program in Iowa violated the Federal Establishment Clause. (3) But if the broader goal of Americans United for Separation of Church and State ("Americans United") in bringing this public interest case was to move the law in a direction that would deter or preclude prison officials or faith-based rehabilitation service providers from using a "faith-immersion" model for providing prison rehabilitation services, the Eighth Circuit's decision has undermined rather than advanced that goal. This is true for the reasons described briefly here, and explained more fully in the remainder of this Article.

First, the Eighth Circuit squarely rejected several extreme theories that Americans United urged throughout, that the district court accepted, and that, if affirmed, would indeed have impeded any future use of the faith-immersion model in prisons. The Eighth Circuit held it was an abuse of discretion for the district court to order recoupment, which would have compelled InnerChange to disgorge over $1.5 million in government funds long since spent to provide rehabilitation services. (4) If affirmed, this ruling would not only have deterred faith-immersion rehabilitation programs, it would have more broadly chilled any cooperation between faith-based organizations and government in providing social services. The Eighth Circuit expressly and summarily rejected the "pervasively sectarian" inquiry under the Establishment Clause. (5) Justice O'Connor's presence on the Eighth Circuit panel renders this decision especially significant, as the few remaining advocates of this doctrine often cite her concurrence in Mitchell v. Helms (6) to support the claim that the doctrine may still survive. (7) The Eighth Circuit also rejected the use of expert witness testimony as evidence of the faith of InnerChange, over against direct evidence from InnerChange of its own faith. (8) The clear reaffirmation of this well-established principle will reduce the risk that the plaintiffs' experts will caricature the beliefs and practices of faith-based service providers in future litigation.

Second, the Eighth Circuit declined to adopt several other tendentious theories that were accepted (or arguably accepted) by the district court. These arguments include: that a service contract bidding process is a religious "gerrymander[]" that lacks "neutral[ity]" where a faith-based service provider is the only bidder, and the bidder and state officials discuss the bid before its submission; (9) that a prison official violates the "endorsement" test by offering praise to a faith-based program for its success or by expressing an expectation that it will succeed; (10) that prisoner rehabilitation services are "traditionally and exclusively" provided by the state, so that any faith-based provider of those services is, by that very fact, a "state actor"; (11) that a faith-based rehabilitation program that requires participation in its religious component violates the "coercion" test, even though inmates enter the program voluntarily, with full knowledge of its religious content, and may exit the program without punishment; (12) that the Establishment Clause requires faith-based rehabilitation programs to be "nonsectarian" and not to "proselytize"; (13) that the potential to complete faith-based rehabilitation courses sooner than secular courses on the same subjects represents an impermissible incentive to join InnerChange. (14) If certain of these rationales for rejecting Iowa's InnerChange program had been adopted by the Eighth Circuit, future use of the faith-immersion model might well be jeopardized--but fortunately, none of them was.

Third and finally, the reasoning of the Eighth Circuit rested on the presence of certain discrete problems in the Iowa InnerChange program that can be fixed readily without abandoning the entire faith-immersion enterprise. To the extent the Eighth Circuit emphasized, for example, that InnerChange's accounting and billing system lacked sufficient controls to assure that direct government aid was not spent on religious activities, (15) the corresponding solution for future programs would be simply to improve those controls. The Eighth Circuit identified other discrete problems that have similarly discrete solutions, such as: removing InnerChange staff from incarceration and disciplinary functions; (16) offering inmates an otherwise similar, privately nm, wholly nonreligious program to which inmates could direct the money that they might otherwise direct to InnerChange; (17) and locating faith-based programs in marginally worse, rather than marginally better, facilities. (18) Mr. Luchenitser, by contrast, not only urges the removal of certain features of the Iowa InnerChange program that the Eighth Circuit did not identify as constitutionally problematic, he urges their removal by rejecting the faith-immersion model as a whole. (19)

In short, the decision of the Eighth Circuit made clear both that the patient needs minor surgery, and precisely how the surgery should be done. The decision does not suggest, as Americans United would have it, that the patient should be abandoned as a terminal case.

1. EXTREME THEORIES REJECTED BY THE EIGHTH CIRCUIT

   1. Restitution Relief for an Establishment Clause Violation

      The single most egregious error of the district court--and the error which, if left uncorrected, threatened the greatest harm to the faith-immersion model of rehabilitation services--was the unprecedented decision to order InnerChange and Prison Fellowship Ministries to pay back to the State over $1.5 million it had already spent to provide the State and its inmates with valuable rehabilitation services. (20) Even a very small risk of such a crushing remedy would deter most faith-based service providers from contracting with the government, whether or not they operate on a faith-immersion model or in the prison setting. (21) This is particularly so when so many faith-based providers survive on a shoestring, and when the standards for assessing liability under the Establishment Clause are so notoriously muddled, uncertain, and hotly contested. (22)

      Americans United has made especially clear that such a far-reaching chilling effect was one of its principal goals in bringing the case. Its press release heralding the district court decision emphasized the breadth of its impact, quoting Executive Director Barry Lynn as saying that "[t]here is no way to interpret this decision as anything but a body blow to so-called faith-based initiatives," and that the ruling affected funding of faith-based activities "in prisons or any other tax-funded institution." (23) It also emphasized the special risk to faith-based organizations as a result of the severe remedy:

      Lynn said in light of this ruling, religious leaders need to be especially wary of the pitfalls of government funding. He noted that InnerChange has been ordered to repay the funds it spent for a program that the court said should have been recognized as unconstitutional. "Church leaders who take faith-based funding may find that they've made an expensive misjudgment if their 'faith-based' funding is challenged," Lynn said. (24) In the appellate litigation that followed, by contrast, Americans United claimed that the remedy would deter only illegal programs. (25) In any event, the Eighth Circuit reversed the recoupment order as an abuse of discretion, thawing whatever chill Americans United may have created briefly. (26)

      1. Equitable Factors Relevant to Recoupment

         The Court of Appeals for the Eighth Circuit found that the trial judge misapplied various equitable factors in reaching its conclusion that InnerChange and Prison Fellowship Ministries should be forced to pay the State back. (27) First and foremost, the panel rejected the claim that InnerChange and the State undertook the program in bad faith, citing the fact that the statutes authorizing the funds were presumptively valid; that the lower court had found elsewhere in its opinion that the funding did not have the purpose of advancing religion; and that the legislature stopped the funding after the adverse district court ruling. (28) The panel also rejected the district court's decision that InnerChange had clear notice that the program was unlawful when the district court attributed such knowledge to InnerChange based only on a factually distinguishable case from another state, and on a critical legal opinion letter by government officials in another state. (29) The court of appeals determined that this was insufficient to render unreasonable InnerChange's reliance on the lawfulness of the funding. (30) Other factors relevant to the court of appeals included the district court's failure to defer to the assessment of prison officials that "the program was beneficial and the state received much more value than it paid for," (31) and the plaintiffs' failure to seek an interim injunction to prevent the continuation of payment during the litigation. (32) The panel appeared to agree with the district court that Prison Fellowship Ministries could afford the financial hit of restitution, but rejected the argument that this was sufficient alone to...