Lawsuit targets charters approved by private, religious schools

A Monroe County public education advocacy group has sued the state and a controversial Monroe County charter school, seeking to block its funding because the group argues that it is unconstitutional for private religious institutions to approve charter schools, which are funded by tax dollars.

The Indiana Coalition for Public Education of Monroe County and South Central Indiana Inc. on Tuesday sued state education officials and the Seven Oaks Classical School. The K-8 school in Ellettsville opened in 2016 under a charter issued by the private Grace College in Winona Lake. But while the suit targets Seven Oaks, it also argues more broadly that religious institutions should be restricted from chartering schools that receive public money.

ICPE includes Monroe County public schoolteachers and employees who will be harmed by the diversion of tax dollars to public schools, according to the complaint filed in the U.S. District Court for the Southern District of Indiana. The complaint “challenges the constitutionality of portions of the Indiana Charter Schools Act on their face and as applied to the authorization of a charter for Seven Oaks Classical School by Grace College and Seminary.”

The school—and the circumstances of its approval—have been controversial from the outset.

IBJ reported in February 2016 that Seven Oaks had applied twice to be approved by the public Indiana Charter School Board, first in fall 2014. Its application was declined because the state officials believed the school lacked adequate board capacity in the areas of accounting and education administration. It was also concerned that the budget did not include serving children lunch—or breakfast for students who are poor enough to be eligible for free- or reduced-price meals.It reapplied in 2015, but the state board’s staff still recommended the proposal be denied.

So it sought Grace College for approval of its charter, in a process known to the education world as “authorizer shopping.” The private college ended up approving the school behind closed doors.

Bill Groth, an Indianapolis attorney working on the case, said the problem is that state law has given religious institutions “unreviewable discretion to perform the role that is normally performed by the state.

“We’ve got a clearly religious institution that is being put in the role of being effectively a state actor by deciding to grant a charter,” said Bill Groth, an Indianapolis attorney working on the case. “There’s nothing in the statute that would, for example, require the religious institution to make that decision based on nonreligious factors. That sort of structure has caused the Supreme Court to in the past find that sort of argument violates the Establishment Clause.”

Terry English, an attorney member of the board of directors of Seven Oaks, said Tuesday the school had not yet been served with a copy of the suit and would not immediately comment. But English said the school believes it’s on sound legal footing.

“Seven Oaks has followed Indiana law,” he said. “Grace College is an authorizer under Indiana law, and we believe we followed the law in its entirety.”

ICPE said Grace College and Seminary describes itself as an evangelical Christian institution that applies biblical values to its educational mission, emphasizes a biblical worldview, and teaches students to recognize scripture as the inerrant and inspired word of God.

“Our chief concern is that Indiana law permits religious institutions like Grace College to decide whether to authorize charter schools,” Cathy Fuentes-Rohwer, chair of ICPE–Monroe County, said in a statement announcing the suit. “Charter schools are taxpayer-supported and take money away from our school corporations, so only state and local officials answerable to the public should be able to authorize them.”

The complaint also challenges a provision in state law that gives up to 3 percent of a charter school’s public funds to the authorizer—in this case, Grace College and Seminary. “That would seem to violate the Indiana Constitution, which says flatly that no money may be drawn from the treasury for the benefit of any religious institution,” lead attorney Alex Tanford, professor emeritus at Indiana University Maurer School of Law, said in the statement.

The suit alleges three counts: that delegating the decision to authorize a charter school to a religious institution violates the Establishment Clause; that providing tax dollars to religious institutions for authorizing charter schools violates the Establishment Clause; and that giving public money to religious institutions violates the Indiana Constitution.

Along with Seven Oaks, the suit names Indiana Superintendent of Public Instruction Jennifer McCormick, who chairs the State Board of Education, as well as James Bentley, executive director of the Indiana Charter School Board. The case is before Chief Judge Jane Magnus-Stinson.