Application of Establishment Clause

to School “Voucher” Program

A draft bill proposing issuance o f compensatory education certificates to parents of eligible 

school children would not on its face violate the Establishment Clause even if the certificates 

would be redeemable at religious private schools.

February 2, 1987

M e m o r a n d u m O p i n i o n f o r A s s i s t a n t A t t o r n e y G e n e r a l ,

O f f i c e o f L e g a l P o l ic y

This memorandum records our comments on the draft Education Consolidation and Improvement Act of 1987. We focus on the Establishment Clause 

concerns raised by the “compensatory education certificates” program which 

would be created under § 106 of the bill. For the reasons set forth below, we 

believe that the program is facially constitutional. We caution, however, that 

the bill, as drafted, may be vulnerable to “as-applied” challenges under certain 

circumstances.

I

Section 106 of the bill would amend Chapter 1 of the Education Consolidation and Improvement Act of 1981 (the Act) by adding a new § 560. That 

section would authorize a local educational agency (“LEA”) receiving Chapter

1 assistance to provide “compensatory education certificates” directly to the 

parents of eligible children,1 in either of two circumstances. First, the LEA 

could provide such certificates if it determined that to do so “would be more 

effective . . . than direct service provided by the agency in meeting the needs of 

[eligible] children.” Section 560(a)(1) (emphasis added). Second, the LEA 

could issue such certificates if it determined that they were “needed to provide 

equitable services to either public or private school children.” Section 560(a)(2).2 

Section 560(b) provides that an LEA shall make such determinations about the 

need for certificates “with respect to individual children, grades, schools,

1 Section 560(h) defines “eligible child” as “an educationally deprived child selected to participate in a 

local educational agency’s Chapter 1 program ” in accordance with §§ 556(b)(1),(2) and 557 of the Act 

(codified at 20 U.S.C. §§ 3805(b)(1), (2), 3806).

2 These tw o criteria, effective and equitable administration, are already required o f Chapter 1 programs. See

20 U.S.C. §§ 3805(b)(4), (5), 3806

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attendance areas, or any combination thereof, or may make such certificates 

available on a district-wide basis.” Section 560(b) further requires an LEA to 

“apply the same criteria to public and private school children in determining 

the extent to which it .will provide . .. certificates.”

Section 560(d)(1) states that certificates may be redeemed by parents only 

for “purchase [of] compensatory education services that meet the identified 

educational needs of [an] eligible child.”3 Subsection (d)(2) provides that these 

services may be purchased “from any public or private school, wherever 

located, that the local education agency determines is able to provide appropriate and effective compensatory educational services to the child.”4 

In sum, when an LEA, applying established and neutral criteria, determines 

that its Chapter 1 program is functioning ineffectively and/or inequitably with 

respect to any individual child or any group of eligible children, the LEA may 

provide compensatory education certificates directly to the parents of such 

children. The parents may then redeem the certificates for compensatory services at the public or private school of their choice.

II

The term “private school,” as used in the draft bill, clearly encompasses both 

religious and non-religious private schools. Thus, it must be measured against 

the Supreme Court’s Establishment Clause precedents dealing with aid to 

religious schools. This is an extraordinarily tangled area of the law, and many 

of the Court’s decisions, when read together, are all but unintelligible. Nevertheless, the draft bill is sufficiently close to the programs upheld in Witters v. 

Washington Department o f Services fo r the Blind, 474 U.S. 481 (1986), and 

Mueller v. Allen, 463 U.S. 388 (1983), that we believe that it survives facial 

constitutional scrutiny.

In Witters, the Court held that the Establishment Clause did not require a 

state to deny vocational assistance to a blind student merely because the 

student chose to apply the aid to religious training at a Bible college. Justice 

Marshall, writing for the Court, found that “any aid .. . that ultimately flows to 

religious institutions does so only as a result of the genuinely independent and 

private choices of aid recipients.” 474 U.S. at 488 (footnote omitted). Consequently, the Court found that the aid program did not have the primary effect of 

advancing or inhibiting religion, and thus passed the second prong of the threepart test announced in Lemon v. Kurtzman, 403 U.S. 602, 612-613 (1971). The

3 The draft bill would establish some safeguards on the redemption of the certificates. Section 560(c)(1) 

would require that the amount for which such certificates may be redeemed must be one “that is equitable to 

all children selected to participate” in the LEA’s overall Chapter 1 program. Subsection (c)(2) would further 

provide that the amount that an individual parent may receive by redeeming his or her certificate “shall not 

exceed the cost o f compensatory services incurred by the parent.” Section 560(g)(3) would require LEAs 

applying for Chapter 1 funds to provide assurances that it will exercise due diligence to ensure that payments 

made to parents are used only for authorized purposes, and to recover any misused funds.

4 Under § 560(e), an LEA would be permitted to use Chapter 1 funds to provide transportation to children 

whose parents choose to purchase compensatory services from schools outside the children’s attendance area. 

That section would define such transportation expense to be “an administrative cost.”

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Court noted that the parties had conceded the first prong of the test, a secular 

purpose. 474 U.S. at 485-86. It declined to apply the entanglement prong until 

after the lower court had an opportunity to do so itself on remand. Id. at 753 n.5.5

In Mueller, the Court voted 5-4 to uphold a state tax deduction for educational expenses, despite the fact that over 90 percent of the tax benefits under 

the statute flowed to religious school students. The Court readily found that the 

statute had a secular purpose: “a State’s decision to defray the cost of educational expenses incurred by parents — regardless of the type of schools their 

children attend — evidences a purpose that is both secular and understandable.” 463 U.S. at 395. Turning to the effects prong of the test, the Court again 

emphasized the facial neutrality of the statute, together with the fact that 

“public funds become available [to religious schools] only as a result of 

numerous private choices of individual parents of school-age children.” 463 

U.S. at 399.6 The Court found no excessive entanglement, despite the fact that 

state officials were charged with disallowing deductions for materials used in 

teaching religion. The Court stated simply that that type of decision did not 

differ substantially from other types of decisions previously upheld, such as 

those involved in textbook loan programs. 463 U.S. at 403.

Like the programs upheld in Witters and Mueller, the draft bill has a clear 

secular purpose. Moreover, it would dispense aid directly to parents pursuant to 

a facially-neutral standard. As a consequence, whatever aid might flow to 

religious schools (and, as a practical matter, it may resemble the proportions 

present in Mueller) would do so only as a result of the individual choices of 

parents. Thus, under Witters and Mueller, it would not have the impermissible 

“primary effect” of advancing religion. Finally, whatever “entanglement” might 

result from an LEA’s duty to approve programs and monitor funds would 

approximate that sanctioned in Mueller. In sum, we think that the program 

proposed in the draft bill would fit within the holdings of Witters and Mueller,

and hence be facially constitutional.

However, neither Witters nor Mueller involved a state officer in the determination of eligibility. Therefore, we wish to caution that if an LEA distributes 

certificates predominantly to religious school students — and especially if it

5 Justice M arshall's opinion also referred to the fact that only a small portion of the state aid would in fact 

end up in the hands o f religious schools. See 474 U.S. at 488. However, this portion o f his analysis was 

effectively disavow ed by five Justices w riting separately. Justice Powell, joined by C hief Justice Burger and 

Justice R ehnquist, stated that “state program s that are wholly neutral in offering educational assistance to a 

class defined w ithout reference to religion do not violate the second part o f the Lemon .. . test, because any 

aid to religion results from the private choices o f individual beneficiaries.** Id. at 491 (Powe)l, J., concurring) 

(footnote om itted). This was true, he said, regardless of the percentage of “private choices” which ultimately 

benefited religious institutions. See id. at 491 n.3. Justice O 'C onnor also did not join the relevant portion of 

Justice M arshall's opinion. See id. at 493 (O ’Connor, J., concurring in the judgment and concurring in part). 

Finally, Justice W hite reiterated his long-standing view that the “the C ourt’s decisions finding constitutional 

violations where a state provides aid to private schools or their students misconstrue the Establishment 

C lause and disserve the public interest.” Id. at 490 (W hite, J., concurring). See also Mueller v. Allen, 463 U.S. 

388,401 (1983) (“W e would be loath to adopt a rule grounding the constitutionality of a facially neutral law 

on annual reports reciting the extent to which various classes o f private citizens claimed benefits under the law.”).

6 The C ourt also cited several “characteristics” of the program , most notably the fact that the benefit was 

available for all parents. See 463 U.S. at 396-399.

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does so on a school-wide basis, then it risks an as-applied challenge. Justice 

Powell’s opinion in Witters emphasized that, in his view, a program must be 

“wholly neutral.” 474 U.S. at 490-91 (Powell, J., concurring) (emphasis added). 

Likewise, in her separate opinion, Justice O’Connor stressed her own “reasonable person” version of the Lemon test: “no reasonable observer is likely to 

draw from the facts before us an inference that the state itself is endorsing a 

religious practice or belief.” Id. at 493 (O’Connor, J., concurring in the judgment and concurring in part); cf. Lynch v. Donnelly, 465 U.S. 668, 690 (1984) 

(O’Connor, J., concurring). As a practical matter, a facially neutral program 

like this one that nevertheless accords substantial discretion to state officials to 

determine the availability of certificates (and which may then result in certificates being issued predominantly to religious school students by virtue of such 

state rather than private decisions) might be insufficiently neutral in application and run afoul of the considerations outlined by Justices Powell or O’Connor, 

or both.

The chances of an as-applied challenge would diminish considerably, in our 

judgment, if the discretion of the LEA was more limited, thereby lessening the 

involvement of the state in the determination of the availability of certificates. 

In this regard, § 560 could provide that once the LEA determined that when a 

given percentage of eligible students were not being effectively or equitably 

served, certificates would be available on an area-wide or district-wide bases. 

This change would preclude any argument that an LEA administrator had 

favored religious schools by a determination under the effectiveness and 

equitability standards that predominantly resulted in the parents of children 

enrolled in religious schools being eligible for certificates.

D o u g l a s W . K m i e c

Deputy Assistant Attorney General

Office o f Legal Counsel

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