The city isn't budging, either. When it isn't claiming erroneously that its hands are tied by the Job Training Partnership Act, it is pointing to the Constitution. But there isn't a total separation of church and state in America, and there never has been. God is mentioned four times in the Declaration of Independence. Congress hires chaplains, as do most state legislatures and the military.
Presidents take the oath of office with a hand on the Bible.
The same words are mounted over the Speaker's rostrum in the US House of Representatives. The words come from a letter Thomas Jefferson wrote in 1802 to the Danbury Baptist Association. The Baptists had suffered much persecution, and Jefferson wanted to reassure them that under the First Amendment, the government had no authority to hinder or control their activities. The First Amendment, Jefferson was saying, is designed to protect religious establishments, not to hassle and harass them. Nothing in the Constitution requires pastors to take down the crucifix from their office door or bars teen-agers from helping little kids say a brief morning prayer.