Universities’ Exempt Status: Political Threat

University and Exempt Status

It was September 8, 1971.  

In the Oval Office, Richard M. Nixon chatted with his chief domestic-policy adviser, John Ehrlichman, about the upcoming 1972 election still fourteen months away. Mentioning potential Democratic rivals by name, the President asked: “Are we going after their tax returns? I … you know what I mean? There’s a lot of gold in them thar hills.” 

We know about this incident and Nixon’s express directive to weaponize the Internal Revenue Service because – (to paraphrase a more recent government official) – “Lordy,” there were “tapes.” These secret recordings were among the evidence used to support the 1974 Bill of Impeachment including Article II: “He has, acting personally and through his subordinates and agents, endeavoured to… cause, in violation of the constitutional rights of citizens, income tax audits or other income tax investigations to be initiated or conducted in a discriminatory manner.”

Fast forward almost fifty years. 

Now there are presidential tweets: out in the open, an undeniably direct line from the Oval Office to the Treasury Department and the Internal Revenue Service:  “Too many Universities and School Systems are about Radical Left Indoctrination, not Education. Therefore, I am telling the Treasury Department to re-examine their Tax-Exempt Status … and/or Funding, which will be taken away if this Propaganda or Act Against Public Policy continues. Our children must be Educated, not Indoctrinated!” 

Tweets come and go, of course, but this one from the morning of July 10, 2020, did not quickly evaporate into the fog of the 24/7 news cycle. There have been concerning developments.  Despite reassurances from leading experts that there are legal barriers to any real tax-exemption jeopardy from the Administration, the nation’s colleges and universities – and, indeed, the nonprofit community generally – have felt a distinct chill in the air well in advance of the official date when summer turns to autumn.  

       Universities Push Back 

The Tweet in Question surfaced against a backdrop of rising tensions between higher education and the Administration including presidential rhetoric on Independence Day at Mt. Rushmore and other recent comments complaining “about schools being driven by what he describes as a radical left-wing ideology” and “‘far left-fascism’ controlling American schools, newsrooms and other institutions.” 

On July 6, 2020, the Administration (through the U.S. Immigration & Customs Enforcement) announced an abrupt change in policy on the status of international student-visa holders. Despite assurances the government offered earlier in the COVID-19 pandemic, there was to be a new rule that these students would have to attend at least one in-person class in the upcoming semester in order to stay in the United States. (Many colleges and universities had announced plans to hold online-only courses in the fall.) 

“Trump’s tweets set off a firestorm of reactions focusing on the implicit political threat against free speech.” The higher-education community pushed back immediately including well-publicized tweets from individual professors vowing to hold at least one in-person class in the coming semester even if it meant everyone would be sitting outside in the snow. And by July 14th, a group of 20 colleges and universities in the Western U.S. filed a lawsuit over this rule change. (That same day, “… what Trump had dubbed “Propaganda” resulted in his administration changing its policy.”) 

In the July 10th Tweet, the president did not name specific institutions whose tax-exempt status he wants the Treasury Department to review. And notwithstanding that the Administration later officially withdrew the immigration-rule change, the threat remained to review tax-exemptions and also withdraw federal funds. 

Among those asking for specifics – and perhaps reassurances that this matter would not be pursued any further – was Rep. Richard Neal (D-MA), chair of the House Ways and Means Committee. On July 15th, he sent letters to the Internal Revenue Service and to the Treasury inspectors general

In their formal written responses at the end of July, these officials, in appropriate bureaucratese, hemmed and hawed about what had happened or what may happen. For instance, the Deputy General Counsel replied that “the Secretary of the Treasury expects that Treasury’s Office of Tax Policy will conduct a policy review of the generally applicable regulations and guidance implicated by the President’s comment.”  And, on July 31st, Treasury Secretary Steven Mnuchin announced there would be some kind of “review” coming, and that the issue of federal funding had been forwarded to the Department of Education for consideration. 

Representative Neal wrote back to Treasury making clear he is not pleased with this state of affairs. 

       Legal Obstacles and Defenses

In Trump tweets, tax law and alleged university ‘propaganda’ (7/19/20) Professors Ellen P. Aprill and Samuel D. Brunson, provide an important and detailed legal analysis of the issues arising from, and defenses to, this threat to meddle.

A few weeks later, on August 2, 2020, Professor Brunson posted additional thoughts, summarizing the key points made earlier; see IRS Investigation of Universities’ Tax-Exempt Status, Nonprofit Blogger. The “…Treasury and the IRS face three significant problems in investigating universities.” 

First, “…even if you assume that universities are politically biased–and even if you assume they teach that bias to students–that doesn’t mean they can’t be exempt. Tax-exempt educational institutions can endorse particular viewpoints.” 

Second, Internal Revenue Code section 7217, “… prohibits the President from requesting that the IRS audit a particular taxpayer.” (No “particular taxpayer” was mentioned in The Tweet; nevertheless, they explain how this statute generally applies; Rep. Neal also mentions this statute in his letters to the IRS and Treasury.) 

Third, “… the Consolidated Appropriations Act, 2020 … prohibits the IRS from targeting groups for regulatory scrutiny on the basis of their ideological beliefs.”

Professors Aprill and Brunson include additional arguments as well in support of their analyses. 

[Update 9/17/20]: This article has just been published, with additional detail, on SSRN under the title: The University, Ideology, and Tax Exemption.

       Conclusion

“Congressional restrictions—in addition to other legal issues—could make Trump’s directive illegal and in violation of the First Amendment, tax and non-profit groups say.” For instance, Mark Mazur, director of the Tax Policy Center and former assistant secretary of tax policy within the Treasury Department under then-President Barack Obama, agrees: “The tax code’s clear that educational institutions generally qualify for tax-exempt status,” adding “It’s not, ‘except the ones I don’t like.’” 

In What a Direct Attack on Free Speech Looks Like (July 10, 2020), The Atlantic, David Graham emphasizes the danger that should make us all shiver. In The Tweet (which he notes had that first day accumulated over 80,000 likes and 30,000 retweets), the President “… is making a bona fide threat against First Amendment speech itself, trying to use the power of the government to punish people whose expression he finds objectionable.”

More Federal Aid to Religious Institutions

The latest chapter in the chipping away of the wall between church and state was announced in early May 2018 by Secretary of Education Betsy DeVos. She set the stage to “loosen federal regulations on religious universities” in connection with federally administered funding.

It’s the most recent example of the potentially far-reaching impact of last year’s Supreme Court ruling in Trinity Lutheran Church of Columbia, Inc.  v. Comer (2017). We wrote about it then, explaining that it was described as a  “landmark” religious freedom ruling.  It seems to be living up to that characterization, as plaintiffs and the current Administration are eager to cite it as authority for their positions. Whether or not the proposed action by Secretary DeVos is, indeed, within the scope of the Trinity Lutheran decision is open to question and may eventually be the subject of a future court battle.

    Loosening Restrictions on Religious Aid

In a broad range of actions since January 2017, the current Administration has moved aggressively to overturn what it views as programs, policies, and rules that unduly disfavor religious groups and institutions.

The Secretary of Education is eager to move that agenda forward. On May 9, 2018, she announced the Department will remove many existing federal regulations on religious universities. It is part of a “sweeping deregulatory agenda for the Education Department announced on … by the White House budget office, which outlined several rules and regulations for the department to scrap or amend. Among those are rules that restrict faith-based entities from receiving federally administered funding.”

An Education Department spokeswoman, Liz Hill, explained that some current regulations on “eligibility of faith-based entities and activities do not reflect the latest case law regarding religion or unnecessarily restrict religion” – referring to Trinity Lutheran. Those regulations, she said, would be reviewed and amended “in order to be more inclusive.” Provisions that “unnecessarily restrict participation by religious entities” or impose “unnecessary burdens and restrictions on religious entities and activities” are likely to be tossed.

In particular, the department takes the position that some provisions of the Higher Education Act may be “overly broad in their prohibition of activities or services that relate to sectarian instruction or religious worship” or “in prohibiting the benefits a borrower may receive based on faith-based activity.”

The department plans to review regulations, keeping an eye out for provisions that “unnecessarily restrict participation by religious entities” and “to reduce or eliminate unnecessary burdens and restrictions on religious entities and activities,” according to the department’s explanation of its proposals.

Previously, in the fall of 2017, Attorney General Jeff Sessions released a memo with 20 principles that “should guide agencies in enforcing federal laws”:

Except in the narrowest circumstances, no one should be forced to choose between living out his or her faith and complying with the law. Therefore, to the greatest extent practicable and permitted by law, religious observance and practice should be reasonably accommodated in all government activity, including employment, contracting and programming.

   Does Trinity Lutheran Apply?

Whether any such new rules and regulations can or will be challenged is open to question. The Trinity Lutheran decision doesn’t appear to be as broad and expansive as the Administration asserts.

In Religious Nonprofits Score Big Political Win, we reported on Trinity Lutheran Church of Columbia, Inc. v. Comer shortly after it was issued. In 2012, the State of Missouri had a grant program to help preschools resurface their playgrounds with new, cushiony surfaces that are safer for the young children. The preschool associated with Trinity Lutheran Church applied for one of the grants and could have been approved except for its religious affiliation. The State of Missouri has a constitutional prohibition on using government funds for religious purposes.

At the trial level as well as at the appellate level, the plaintiffs lost. However, at the U.S. Supreme Court, by a 7-2 vote, they scored a win. The money in question was earmarked for the secular purpose of making an outdoor playground space safer for the children. The sole reason for denial of the grant was the religious affiliation of the applicant-organization. Writing for the majority, Chief Justice John Roberts explains that the Free Exercise Clause of the First Amendment “…protects religious observers against unequal treatment.” In other words, a state “may not deny a church an otherwise available public benefit or payment because of its religious status.”

The Trinity Lutheran majority made clear that it was a limited ruling only: “This case involves express discrimination based on religious identity with respect to playground resurfacing. We do not address religious uses of funding or other forms of discrimination.”

   Conclusion

The Administration is moving full-steam-ahead on the apparent assumption that the Trinity Lutheran decision has authorized them to interpret and apply the decision expansively. But the express language appears to negate any such broad application. And, recently, the New Jersey Supreme Court, in Freedom from Religion Foundation v. Morris County Board of Chosen Freeholders, April 18, 2018, A-71-16, (079277), ruled unanimously that “Trinity Lutheran did not prohibit New Jersey from denying state aid to repair damaged sanctuaries because that would support religion.”

Food, Faith, and Fair Labor Standards: An Update

Last year, in Food, Faith, and Fair Labor Standards, we reported on a wage-and-hour lawsuit involving a church’s battle with the U.S. Department of Labor.

Ohio’s Grace Cathedral had been pummeled with huge penalties for allegedly violating minimum wage and overtime rules under the federal Fair Labor Standards Act. In March 2017, a federal district court upheld these FLSA penalties and awarded back wages, too, in connection with Grace Cathedral’s operation of a restaurant with what the church termed “volunteers.”

Grace Cathedral appealed to the Sixth Circuit – and won. The court’s ruling, issued on April 16, 2018, turned the tables; this time, the pummeling was directed at the district judge for poking his nose into the internal – spiritual – affairs of the church.

   The Fair Labor Standards Lawsuit

Grace Cathedral is a Cleveland-based megachurch; its spiritual leader is the Rev. Ernest Angley. The Cathedral Buffet is a for-profit restaurant owned by Grace Cathedral, Inc.; “(f)or most of its existence, the Cathedral Buffet…

relied on church ‘volunteers’ to operate the restaurant. Angley, as president of Cathedral Buffet, was heavily involved in the management and operations, and actively recruited volunteers from the church. The restaurant maintained two classes of workers: employees who were paid an hourly wage and unpaid “volunteers.” The volunteers constituted the bulk of the restaurant’s workforce and performed virtually all the same jobs as the paid workforce.”

In 2015, the federal Department of Labor, which has jurisdiction over FLSA issues, filed a lawsuit against Grace Cathedral, including a request for liquidated damages, back wages for the workers, and a permanent injunction. The monetary demands were for hundreds of thousands of dollars.  

The lawsuit was heard by a federal judge instead of a jury.  “Testimony at trial suggested that Angley would personally exert pressure and influence upon would-be volunteers by threatening spiritual harm and God’s displeasure if they did not work at the restaurant when asked.” Although the Church supplied over 100 affidavits from the “volunteers,” the DOL successfully impeached the credibility of some of them.

Grace Cathedral argued at trial that the “volunteers” are “doing the Lord’s work” and so should be exempt from the minimum wage and overtime protections of the Fair Labor Standards Act.

In ruling for the Department of Labor, however, the district court relied on a landmark FLSA case from a few decades ago:  Tony & Susan Alamo Foundation v. Secretary of Labor (1985) 471 U.S. 290. That case, too, involved a charismatic religious leader and the use of “volunteers” in various business enterprises. The Alamo Supreme Court described the activities as deriving “income largely from –

the operation of commercial businesses staffed by the Foundation’s ‘associates,’ most of whom were drug addicts, derelicts, or criminals before their rehabilitation by the Foundation. These workers receive no cash salaries, but the Foundation provides them with food, clothing, shelter, and other benefits.”

In Alamo, the government’s reliance on the worker protections of the Fair Labor Standards Act won the day. The Supreme Court ruled that: “(1) the Foundation was an “enterprise” within the definition of the FLSA, (2) “the Foundation’s businesses serve the general public in competition with ordinary commercial enterprises, and (3) under the “economic reality” test of employment, the associates were “employees” of the Foundation protected by the Act.”

Notably, the high court rejected Alamo’s defenses under the Free Exercise and Establishment Clauses of the First Amendment, ruling that there is “no express or implied exception for commercial activities conducted by religious or other nonprofit organizations,” adding that the FLSA has been “consistently construed … liberally in recognition that broad coverage is essential to accomplish the goal of outlawing from interstate commerce goods produced under conditions that fall below minimum standards of decency.”

   The Appellate Ruling

In its appeal to the Sixth Circuit, Grace Cathedral argued that the FLSA should not apply because the restaurant is owned and operated by a church, doesn’t make a profit, operates with “charitable intent” and “‘volunteers’ didn’t expect to get paid and didn’t feel coerced to volunteer.”  In support of this argument, the Church supplied 134 affidavits of church volunteers. The text of the opening brief is here.

In its response brief (here),  the Department of Labor disagreed, arguing that the “FLSA prohibits the use of volunteer labor at for-profit businesses” adding that the agency “disapproves of the use of ‘coercion or pressure to procure volunteers,’ including the threat of divine retribution.”

The Sixth Circuit appellate panel ruled 3-0 (here) in favor of the Church, reversing the almost $400,000 verdict from the trial court.

At the outset, the Sixth Circuit made a finding different than the district judge; that is, that the volunteers at Cathedral Buffet “did not expect to receive compensation.”  The judges ruled that the volunteers were not dependent on this work for their economic survival, unlike the “drug addicts, derelicts, and criminals” in the  Alamo case.  The Sixth Circuit judges were emphatic on this point: “It is undisputed that the volunteers who worked at Cathedral Buffet had no such expectation.”

Generally, under the Fair Labor Standards Act, one of the key inquiries is the “economic realities” test; but the law – according to the appellate court – “plainly requires us to first ask whether Cathedral Buffet’s volunteers worked in ‘expectation of compensation.’ They did not.”

In addition, the appeals court found that there was an insufficient showing of “economic coercion” emphasizing that “spiritual coercion” was not enough – and was plainly beyond the scope of what a court of law should be deciding. The “type of coercion with which the FLSA is concerned is economic in nature, not societal or spiritual.”

[A]lthough the FLSA might aim to curb the societal ills caused by low wages, it does so through a comprehensive system of economic regulations. The Act does not go so far as to regulate when, where, and how a person may volunteer her time to her church. After all, the giving of one’s time and money through religious obligation is a common tenet of many faiths.

   Conclusion

The writer of the Sixth Circuit concurring opinion leaves no doubt about his feelings on the matter; he opens with –

One hopes that the Department of Labor simply failed to think through its decision in this case…; [that is,] the premise … that the Labor Act authorizes the Department to regulate the spiritual dialogue between pastor and congregation—assumes a power whose use would violate the Free Exercise Clause of the First Amendment.

And his final thoughts in that opinion are:

What is perhaps most troubling about the Department’s position in this case, however, is the conceit of unlimited agency power that lies behind it. The power of a federal agency is no more than worldly. The Department should tend to what is Caesar’s, and leave the rest alone.

A quick reminder: The Sixth Circuit’s opinion is binding only on states within its jurisdiction; that is, Ohio, Kentucky, Michigan, and Tennessee.

Religious Nonprofits in the Trinity Lutheran Era

On June 26, 2017, the United States Supreme Court issued what has been described as “one of the most important rulings on religious rights in decades.” In Trinity Lutheran Church of Columbia v. Comer, Chief Justice John Roberts explains that the Free Exercise Clause of the First Amendment “…protects religious observers against unequal treatment.” The government “may not deny a church an otherwise available public benefit or payment because of its religious status.”  

Trinity Lutheran Church operated a preschool and daycare center on its property. In 2012, it applied for a Missouri program offering financial assistance to install safer playground surfaces for facilities with young children. Although Trinity Lutheran ranked 5th out of 44 applicants, its request was denied. The Missouri Department of Natural Resources “had a strict and express policy of denying grants to any applicant owned or controlled by a church, sect, or other religious entity.” Specifically, Article I, Section 7 of the Missouri Constitution prohibits providing “financial assistance directly to a church.” Many other states have similar constitutional prohibitions on direct financial aid to a church.

The Church decided to fight this policy, filing a federal lawsuit on constitutional grounds. We previously reported on the legal journey to eventual victory in the Supreme Court.

More often than not, … First Amendment lawsuits are marked by a tug-of-war between [the Establishment Clause and the Free Exercise Clause]. Over decades, the pendulum tends to swing back and forth; during some periods, there is more activity in connection with the Establishment Clause; in others – including right now – there is more focus on claims of violation of the Free Exercise Clause. In this case, the Free Exercise Clause argument won out in the Supreme Court, although both of the lower courts ruled against Trinity Lutheran Church.

The Supreme Court’s ruling elicited significant opposition and controversy, but there has been little doubt that it will have a dramatic effect on pending and future cases. Two recent lower-court decisions confirm this prediction that Trinity Lutheran will pop up regularly – even if unsuccessfully, from the standpoint of these plaintiffs.

  Religious Organization and State Funds

In a case with some similarities to the fact pattern of Trinity Lutheran, the Vermont Supreme Court in Taylor v. Town of Cabot (October 2017) issued a ruling that referenced the U.S. Supreme Court religion decision.

There, certain municipal taxpayers sued to challenge a town’s use of federally derived but municipally managed funds to repair a historic church. Vermont has a Compelled Support Clause in its Constitution – similar to Missour’s – which protects against the state financial support of  “worship.”

A particular twist here meant the taxpayer-plaintiffs won a battle but lost the war. The Vermont high court ruled that the taxpayer-plaintiffs were not entitled to the preliminary injunction imposed by the trial judge. While they had standing to request that relief, they were out of luck on ultimately winning the merits of the case.

Vermont’s Compelled Support Clause did not apply because most of the state funds in this situation were “to be used for maintenance and repairs to a building that serves not only as a place of worship but also as a place for nonsectarian community events and gatherings.” And the federal First Amendment, under the Trinity Lutheran rationale, can now not be used to refuse access by religious organizations (solely on account of their religious affiliations) to government money otherwise generally available.

   Religious College Argues Trinity Lutheran Unsuccessfully

A second case in which the plaintiff sought to use Trinity Lutheran to its advantage had quite different facts.

In Illinois Bible Colleges Ass’n v. Anderson (August 2017), an association of bible colleges sued on behalf of its member institutions who want to issue whatever degrees and credentials they wish without any supervision or interference by state agencies imposing statutory standards. However, Illinois has a number of statutes that apply to all post-secondary educational institutions that mandate that a higher education board approve certain categories of degrees.

The plaintiff raised the entire spectrum of First Amendment challenges, including the Establishment Clause and the Free Exercise Clause. On appeal to the Seventh Circuit, the plaintiff was unsuccessful. There was no undue government entanglement; hence, no defense under the Establishment Clause. And citing to Trinity Lutheran and other authority made no headway in the argument that the statutes involve an underlying and unconstitutional anti-religious animus or bias. [“T]he Supreme Court recently made clear in Trinity Lutheran Church a law may not ‘regulate or outlaw conduct because it is religiously motivated’; here, however, there was no such showing at all.”]

   Conclusion

We can expect to see many court decisions exploring the implications and boundaries of the Trinity Lutheran case. It may or may not turn out – as Trinity Lutheran critics charged – that the “Supreme Court weaken[ed] the wall between church and state,” or “obliterate[d] it” or that “[s]omewhere, James Madison is shaking his head in disbelief.”
 

News for Churches and Religious Organizations

There are several recent developments of interest for tax-exempt churches and religious institutions.

   Johnson Amendment

In December’s whirlwind attempt to write and pass a tax overhaul law that could win enough votes in the House of Representatives as well as in the Senate, it was unclear until just before the final conference-reconciliation voting whether the proposed legislation would include a total or partial repeal of the Johnson Amendment. Although Senate conferees accepted the House’s modified-repeal version, the Senate Parliamentarian rejected it, and that was that – at least for the time being.
Lawmakers remain interested, though, in making a significant change to the 501(c)(3) ban on political-campaign activity; some have already indicated they intend to write new bills in this new year. There is a consensus in the charitable sector at large opposing any change at all; in the various religious communities around the U.S., there are proponents as well as opponents.

[Updates: 3/20/18; 3/23/18: Legislators are, indeed, moving this matter back into active consideration, but it was not included in the budget package enacted this week.] 

   FEMA Aid for Religious Organizations

In the aftermath of the devastating late-summer hurricanes in Texas, Florida and the Caribbean, individuals and organizations who needed (and gave) help sought reimbursement from the Federal Emergency Management Agency.
There has been an existing FEMA agency policy not to grant relief to churches and religious groups, even those who provide important community relief assistance. In the immediate aftermath of the Texas disaster, several churches submitted claims for relief, which were rejected. In Hurricanes, Houses of Worship, and FEMA Help, we reported that they filed lawsuits to challenge the FEMA rule, arguing that churches should not be denied assistance on the ground of religious affiliation alone. Under the rationale of the recent Trinity Lutheran landmark decision of the U.S. Supreme Court, these organizations argue that denying relief claims of religious organizations while granting relief to other entities, similarly situated, is unconstitutional.
There have been several developments in recent months. First, the plaintiffs filed an immediate request for injunctive relief, alleging irreparable harm if they had to wait for FEMA money until after a trial. The federal agency conceded the merits of their claim, and asked the court for more time to revise its policy, but – nevertheless – refused the claim. In December, a federal district court in Texas ruled against the plaintiff-churches. They filed an emergency appeal to the Fifth Circuit Court of Appeal. That court agreed to hear the appeal on an expedited basis but denied the injunction after allowing the parties to brief and argue their positions.
Then, in a major policy shift in the first week of January 2018, the Administration announced a change. In a new manual, the Federal Emergency Management Agency wrote that its rule will no longer disqualify religious groups from reimbursement under the “community centers subcategory of [Public Assistance] nonprofit applicants.”

   Religious Discrimination

In early October 2017, U.S. Attorney General Jeff Sessions published a broad memo in the Federal Register instructing all federal departments and agencies on the “Principles of Religious Liberty.” In a marked change in policy from earlier administrations, “religious organizations may choose to employ only persons whose beliefs and conduct are consistent with the organizations’ religious precepts.”
The memo described 20 principles based on the current Justice Department’s interpretation of existing federal laws, specifically the 1993 Religious Freedom Restoration Act. The deadline for public comments was November 24, 2017.
This proposed new policy, titled Removing Barriers for Religious and Faith-Based Organizations To Participate in HHS Programs and Receive Public Funding, has caused alarm in many groups including the LGBTQ community who fear this will sanction discrimination against them.

    Conclusion

There were interesting developments in October 2017 and then again just before Christmas on the future of the clergy “parsonage allowance.” The bottom line is that it appears this particular tax break is “safe for the present,” as explained by Forbes Magazine’s Peter C. Reilly, CPA.  We’ll cover this issue separately in a later post.
 

Johnson Amendment Stays … For Now

In mid-December 2017, when the GOP Congressional leadership was scrambling to get a tax-overhaul bill in final form – one that would meld the quite different House and Senate versions – an issue that could have gone either way, in or out, was the thorny matter of 501(c)(3)s dabbling or plunging headlong into the political arena.

   History of Johnson Amendment

Under the 1954 Johnson Amendment to an earlier comprehensive rewrite of the federal tax code, charitable, tax-exempt organizations were prohibited entirely from participating in political campaign activity.  Although for years, many people have thought that this politics ban was a carefully considered policy decision, it was not. In a 2016 post, The 501(c)(3) Politics Ban: Its Odd History, we described what actually happened at the eleventh hour of tax negotiations in a smoke-filled back room at the U.S. Capitol.
From time to time, there’s discussion of changing it or getting rid of it entirely.  That push has heated up recently, so it’s not surprising that the topic popped up in the midst of the most comprehensive rewriting of the federal tax code in over 30 years.

    Tax Overhaul Proceedings

The original version of H.R.1, the Tax Cuts and Job Acts of 2017, passed by the House of Representatives included a partial tweak of the Johnson Amendment. It would have allowed any and all 501(c)(3) organizations – not just churches or religious groups – to engage in partisan campaign activities in support of or opposition to a candidate, but only under two conditions. First, the electioneering activities must take place “in the ordinary course of the organization’s regular and customary activities in carrying out its exempt purpose,” and if the group incurs only  “de minimus” incremental expenses.
The Senate’s original legislation did not mention the Johnson Act at all. That may have been a policy consensus or – more likely – a realization by leadership that such a proposal would violate the 51-vote “Byrd Rule” that limits “budget reconciliation” proceeds to matters that are “germane.”
When H.R.1 proceeded to conference reconciliation, the Senate side changed its position and was willing to accept the House version that proposed significant loosening of the Johnson Amendment in certain conditions. The Senate Parliamentarian, who has the final word on what meets the 51-vote, filibuster-free, non-regular-order procedure, ruled that the Johnson Amendment changes had to be tossed.
One lawmaker, Senator James Lankford (R-OK), disagreed and took his case directly to the Parliamentarian. “Lankford went to the mat, pushing to the very end.” According to this strong proponent of repealing the Johnson Act entirely, “[t]he federal government and IRS should never have the ability, through our tax code, to limit free speech….” (In February 2017, Sen. Lankford had introduced legislation (S.264) that would have done just that.) Reportedly, Lankford may pursue a stand-alone bill again this session; he has an ally in the House in Rep. Walter Jones (R-N.C.) who had introduced a full-repeal bill there in early 2017.
This is a hot-button issue for many reasons including the possibility of significant diversion of charitable dollars. During the late 2017 tax-overhaul proceedings, the nonpartisan Joint Committee on Taxation, estimated that some $1.2 billion in donations to campaign and candidate committees each year could shift to nonprofits. Donations to political committees are not tax-deductible but giving to charities is, which would mean less revenue for the Treasury.”

   Johnson: What’s Next?

As a stand-alone legislative proposal, there are no “germaneness” issues like those that cropped up under the “Byrd Rule” in December. So, except for the tricky matters of deciding which version of full or partial repeal is desired, along with the big question of whether the repeal should apply to all 501(c)(3)s and not just “churches,” and what in the world is the meaning of conditions like “in the ordinary course of the organization’s regular and customary activities in carrying out its exempt purpose,” or “only ‘de minimus’ incremental expenses,” change proponents may be good to go at any time now.
But we’re forgetting one thing: A change of sorts was already made last year on May 4, by the strange and inscrutable “Executive Order Promoting Free Speech and Religious Liberty”  from the White House. There are several sections; this link is to the full text which includes a Section 2 relating to 501(c)(3)s and the Johnson Amendment titled “Respecting Religious and Political Speech.”  Since it’s been archived, and hard to find, here it is verbatim:

Respecting Religious and Political Speech.  All executive departments and agencies (agencies) shall, to the greatest extent practicable and to the extent permitted by law, respect and protect the freedom of persons and organizations to engage in religious and political speech.  In particular, the Secretary of the Treasury shall ensure, to the extent permitted by law, that the Department of the Treasury does not take any adverse action against any individual, house of worship, or other religious organization on the basis that such individual or organization speaks or has spoken about moral or political issues from a religious perspective, where speech of similar character has, consistent with law, not ordinarily been treated as participation or intervention in a political campaign on behalf of (or in opposition to) a candidate for public office by the Department of the Treasury.  As used in this section, the term “adverse action” means the imposition of any tax or tax penalty; the delay or denial of tax-exempt status; the disallowance of tax deductions for contributions made to entities exempted from taxation under section 501(c)(3) of title 26, United States Code; or any other action that makes unavailable or denies any tax deduction, exemption, credit, or benefit.

In last year’s post about this EO, we included commentary and reaction from various philanthropy and legal experts. The general reaction of these folks on Twitter was “meh”; it’s a “nothing burger.” Even the ACLU – which was ready to pounce on news this executive order was about to be issued – stood down.  
In any event, there was some formal, written commentary; we listed about five of those scholarly articles. Here’s one:  What Happened to the Johnson Amendment? The Effect of Today’s Executive Order on Nonprofit Organizations [“The Executive Order … does not (and cannot) overturn the Johnson Amendment, … but it appears to direct the Department of Treasury to treat religious charities and religious issues differently when considering enforcement of the Johnson Amendment”]

   Conclusion

So here we are – in January 2018 – entirely uncertain about the status, application, or future of the Johnson Amendment.  
Our conclusion from last year’s post still applies, though: “Undoubtedly, this May 4th Executive Order is not the last word on 501(c)(3)s  and political campaign activity. It may be modified or Congress may decide to take additional action or – well – who knows these days?”

[Update 1/17/18]: In an excellent law review article posted online yesterday, Prof. Ellen P. Aprill of Loyola Law School, L.A., examines the history of the Johnson Amendment up to the present, and includes predictions and analyses of what may – or should – happen in the next weeks or months. See “Amending the Johnson Amendment in the Age of Cheap Speech,” (Jan. 16, 2018) 2018 U.Ill.L.Rev. Online 1.

Net Neutrality and Nonprofits

It’s like we’re watching a master magician deftly keeping us laser-focused on what he’s doing with his right hand; that is, a lightning-speed, massive overhaul of the federal tax code.  
His left hand, behind his back, is pulling a fast one on an issue as significant to all of us as the proposed tax changes. He’s hoping we won’t notice.

  What is Net Neutrality?

In a sense, this post’s title is a bit misleading. There’s no special or particular danger to nonprofits if net neutrality is smashed to bits. It’s a bad deal for everyone – except a few major telecom firms like Verizon.
If the “neutrality” of the internet is lifted, though, it will likely have a severe and specific effect on the nonprofit world – on top of the overall profound change it may have on all of our lives.
In a nutshell, net neutrality is quite simple. For the short life of the internet so far, it has been wide open. Access to it is neutral and fair. The business startup has an equal chance on this level playing field with economic giants. So does a small nonprofit just getting off the ground against charity behemoths.  It’s a world-wide forum for the exchange of ideas, information, and commerce.
A court decision a few years ago led to some question about whether that “open” status could continue under telecommunications laws established well before the rise of the internet.  In response, the Federal Communications Commission (FCC) in 2015 enacted regulations guaranteeing that “net neutrality” would continue.

    Why is Net Neutrality In Danger Right Now?

The FCC has five commissioners; traditionally, the President’s party gets 3 of the 5 appointments. The Obama Administration strongly backed Net Neutrality. That’s how the 2015 FCC made the decision to confirm the openness of the internet.
One of the 2 minority commissioners in 2015 was elevated to the position of chair of the FCC in 2017. He is opposed to Net Neutrality. Because of the current political composition of the commission, Net Neutrality is set to evaporate next week by a simple vote of the commissioners.
In F.C.C. Plans Net Neutrality Repeal in a Victory for Telecoms, the New York Times, on November 21, 2017, published a helpful explanation of how and why the matter of Net Neutrality is headed for a showdown on December 14, 2017, at the Federal Communications Commission.
That same day, in FCC plan would give Internet providers power to choose the sites customers see and use, the Washington Post also delivered a useful, in-depth explanation.
Citing both major newspapers, the Nonprofit Quarterly posted its own analysis the next day: Open Internet’s Last Stand: FCC Chair Pai Promises Plan to Nuke Net Neutrality.
In the New York Times article, there is a good summary of the opposing arguments:

The action ‘represents the end of net neutrality’ as we know it and defies the will of millions of Americans,” said Michael Beckerman, chief executive of the Internet Association, a lobbying group that represents Google, Facebook, Amazon and other tech companies.
[FCC Chair Ajit] Pai said the current rules had been adopted to stop only theoretical harm. He said the rules limit consumer choice because telecom companies cannot offer different tiers of service, for example. As a result, he said, internet service companies cannot experiment with new business models that could help them compete with online businesses like Netflix, Google and Facebook.

Latest Developments: Possible Vote Delay

At a news conference late on Monday, December 4th, Eric Schneiderman, the attorney general of New York, and Jessica Rosenworcel, a Democratic FCC Commissioner, demanded a delay in the scheduled December 14th FCC vote.

They are part of a mounting backlash of critics who have seized on what they say are millions of fake or automated comments submitted to the agency that have corrupted the policymaking process.
Public comments play an important role at the FCC, which typically solicits feedback from the public before it votes to make significant policy changes…. Schneiderman and Rosenworcel said … that widespread irregularities tied to net neutrality feedback, including at least 1 million phony comments, have tainted the public commenting process. The allegations are buttressing a campaign by online activists and government officials who oppose the FCC’s plan to dismantle net neutrality rules.

Conclusion

Net Neutrality: It’s not rocket science.  As proof, check out Net Neutrality for Kids, in which an intrepid reporter for the San Diego City Beat describes his afternoon explaining the concept to a child: 

 ‘So yeah, a day might come where your friends might all be playing a game, and you can’t play it because you don’t have the same internet service as they do.’
 ‘That’s stupid,’ he snapped.
 ‘Yeah, kid. You’re telling me,’ I said. ‘Now go tell your mom.’

 
 

Hurricanes, Houses of Worship, and FEMA Help

We reported over the summer about Trinity Lutheran Church of Columbia v. Comer, “one of the most important rulings on religious rights in decades.”
There, Chief Justice John Roberts, writing for a 7-2 majority, explains that the Free Exercise Clause of the First Amendment “…protects religious observers against unequal treatment,” and rules that a state “may not deny a church an otherwise available public benefit or payment because of its religious status.”  The Trinity Lutheran case involves a Missouri program granting financial assistance to preschools for repaving their premises with a bouncy material that is much safer than asphalt for young children. A church-affiliated preschool applied for this aid but was refused. The federal district court and the appellate court upheld the denial. The Supreme Court reversed.
Justices Ginsburg and Sotomayor wrote powerful dissents, and there has been some serious criticism by legal commentators of the majority’s holding. There is also a quirk in this case that is unique to Missouri state law.
There is already a new wave of lawsuits – and more expected – in which plaintiff-religious organizations will seek to take advantage of this new legal precedent. They arise from the violent hurricanes affecting Texas, Florida, and U.S. territories in the Caribbean and requests for Federal Emergency Management Agency (FEMA) relief.

   Disaster Relief and Religious Groups

Historically, FEMA has –

denied disaster assistance funds to countless houses of worship in the wake of disasters like Hurricane Katrina and Superstorm Sandy, including a Jewish Chabad, a homeless shelter church ministry, and a Unitarian Universalist church. At the same time, FEMA gave aid to an octopus research center, a botanical garden, and community centers that provide sewing classes and stamp-collecting clubs.  

Under FEMA rules, requests for aid ordinarily must be made within 30 days after a disaster. Already, “in Harvest Family Church v. FEMA, three small Texas churches damaged by [Hurricane] Harvey are challenging a FEMA policy that bans them from applying to its relief program simply because they are religious.” Other nonprofits, “such as museums and zoos, qualify for FEMA’s relief programs to help make basic structural repairs and begin rebuilding,” while “churches, synagogues, and other houses of worship are denied access to grants.”

‘The churches are not seeking special treatment; they are seeking a fair shake,’ the lawsuit reads. ‘And they need to know now whether they have any hope of counting on FEMA or whether they will continue to be excluded entirely from these FEMA programs. If the Churches were to cease all religious activity in their houses of worship, those buildings would become assistance-eligible.’

  Not All Religious Groups Are On Board

This issue is not exclusive to Christian churches. Jewish groups are taking opposing sides on whether the devastation of Jewish institutions from Hurricane Harvey should make them eligible for FEMA funds. Groups on the Jewish right, led by the Orthodox Union, have been lobbying the government for a change in the exclusion of houses of worship. They are being met with opposition from the Jewish left, who are coordinating with interfaith coalitions to keep taxpayer funds from supporting religious organizations.”

‘FEMA, like the rest of the federal government, is prevented by the First Amendment from steering taxpayer funds to houses of worship. While there is an understandable temptation to provide public funds to houses of worship in the aftermath of a natural disaster, it’s a temptation we must resist,’ Rabbi Jack Moline, president of the Interfaith Alliance, said in a statement. ‘The underpinning of religious liberty in America is the separation of church and state. Steering public funds to houses of worship clearly violates constitutional boundaries between the two and would open the door to government interference in the affairs of houses of worship.’

Conclusion

This issue of eligibility for FEMA disaster relief is – and will continue to be – a matter of urgency for houses of worship devastated by natural disasters. The government has indicated it is aware of these new lawsuits and is considering the matter for a possible speedy resolution one way or another.

Religious Nonprofits Score Big Constitutional Win

It all started several years ago on a playground at a church preschool in Columbia, Missouri. The saga concluded on June 26, 2017, when seven of the nine justices of the United States Supreme Court ruled in favor of the church.
In Trinity Lutheran Church of Columbia v. Comer, Chief Justice John Roberts explains that the Free Exercise Clause of the First Amendment “…protects religious observers against unequal treatment.” It is a significant First Amendment decision, now stating the proposition that a state “may not deny a church an otherwise available public benefit or payment because of its religious status.”  

  Setting the Stage for a Constitutional Showdown

In 2012, the State of Missouri created a fund to help eligible nonprofits repair their old playground coverings with a pour-in-place rubber surface made from recycled tires. The new material is squishy, sustainable, and much safer for kids.
Of course, there was only so much money available. Applications for reimbursement grants were made to the Missouri Department of Natural Resources which has been in charge of administering this Scrap Tire Program.
Columbia’s Trinity Lutheran Church has a preschool and daycare center called the Child Learning Center. “Originally established as a nonprofit organization, the Center –

later merged with Trinity Lutheran Church and now operates under its auspices on church property. Among the facilities at the Center is a playground, which has a coarse pea gravel surface beneath much of the play equipment.

Trinity’s Child Learning Center applied under the Scrap Tire Program. Although it “ranked fifth out of the 44 applicants,” its application was rejected. Some 14 grants were made that year.
The Department of Natural Resources “had a strict and express policy of denying grants to any applicant owned or controlled by a church, sect, or other religious entity.” This was based on Article I, Section 7, of the Missouri Constitution which prohibits providing “financial assistance directly to a church.” In about 3 dozen other states, similar constitutional provisions prohibit spending any public money on “any church, sect, or denomination of religion.”
Trinity Lutheran Church fought back by filing suit in federal district court on constitutional grounds.

  Constitutional Law: Complex, Controversial

Constitutional law is a tough nut to crack even for lawyers, and the First Amendment is just about the toughest nut of all.
The First Amendment reads: “Congress shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof. (emph. added)
The first part, commonly called the Establishment Clause, “forbids the government from establishing an official religion,” or unduly favoring one faith over another.
The second part, known as the Free Exercise Clause, protects the individual’s right to freely exercise his or her chosen religion.
These two clauses within the First Amendment can and should be complementary expressions of our nation’s commitment to separation of church and state as well as to the promise of protection of an individual’s right to practice a chosen religion without undue burden or government interference. More often than not, though, First Amendment lawsuits are marked by a tug-of-war between these two goals.
Over decades, the pendulum tends to swing back and forth; during some periods, there is more activity in connection with the Establishment Clause; in others – including right now – there is more focus on claims of violation of the Free Exercise Clause. In this case, the Free Exercise Clause argument won out in the Supreme Court, although both of the lower courts ruled against Trinity Lutheran Church.
At the trial level, the federal judge dismissed Trinity’s lawsuit on grounds that the Free Exercise Clause “prohibits the government from outlawing or restricting the exercise of a religious practice, but it generally does not prohibit withholding an affirmative benefit on account of religion.”
When the case moved on to the appellate court, the thorny issue of the Missouri Constitution was thrown into the already volatile mix. Trinity Church once again lost. A divided panel of judges explained that, while the –

State could award a scrap tire grant to Trinity Lutheran without running afoul of the Establishment Clause of the Federal Constitution, [that] did not mean that the Free Exercise Clause compelled the State to disregard the broader antiestablishment principle reflected in its own Constitution.

To complicate matters more, a sudden change in the Missouri governorship in 2017 from a Democrat to a Republican had a significant effect as well.

At oral argument, the lawyer defending the law seemed to face an uphill battle in defending the exclusion of church groups from a program with only a secular goal — making playgrounds safer — and for which Trinity’s Learning Center would have been approved had it been a secular preschool.
Some states with the same restriction as Missouri already allow churches to participate in programs that are generally applicable to the public and are for secular benefits such as health and safety.
Adding a twist to the case, Missouri now does as well. The state’s new Republican governor, Eric Greitens, announced just before the April oral argument that he was reversing the policy that denied Trinity’s application in 2012 and that churches are now eligible to participate.
The state’s new attorney general agrees, and a private attorney was appointed by the state to defend its old policy.

  Conclusion

Described as “one of the most important rulings on religious rights in decades,” the full text of Trinity Lutheran Church v. Comer is here: all 53 pages including the dissent by Justices Sotomayor and Ginsburg.
For provocative commentary criticizing the majority’s opinion, see, for instance:

  • Prof. Noah Feldman, Harvard Law:  Supreme Court Weakens Wall Between Church and State [“In other words, the free exercise clause has trumped the establishment clause, which was created precisely to stop government money going to religious purposes. Somewhere, James Madison is shaking his head in disbelief.”]
  • Perry Grossman, Esq. & Mark Joseph Stern, Goodbye, Establishment Clause [“The Supreme Court’s ruling … threatens to obliterate the divide between church and state.”]

Fighting City Hall: Tiny Charity Wins in Tampa Bay

“The biblical story of David and Goliath is probably the most well-known underdog story in the world. * * * For 3000 years, [it] has seeped into our cultural consciousness.” It’s human nature to root for the little guy who, confronted by a powerful bully, turns the table and – against all odds – pummels him.
Last month, there was just such a victory in Tampa Bay, Florida. One of the least powerful charities in town had no choice but to fight the government.  On August 8, 2016, a federal court made it official: Homeless Helping Homeless: 1; City Hall: 0.

    Criminalizing Poverty

“Nonprofits facing what they consider unreasonable restrictions by local government sometimes must take matters to court if they cannot work things out through the political process.”
In recent years, all around the nation, there have been aggressive governmental efforts to chase out the poor and homeless, especially from downtown, tourist, and business areas. Municipalities have enacted and vigorously enforced sweeping ordinances barring panhandling and sleeping outdoors. For example, in 2011, the city of Orlando jailed activists for feeding the hungry in a public park; in 2015, Fort Lauderdale police arrested a 90-year-old for running a food-sharing program.
Tampa Bay decided to combat its own serious homelessness problem with similar laws. A 2011 ordinance prohibits begging on city streets every day but Sunday “while allowing newspaper vendors to work the curb seven days a week.” A 2013 law prohibits sleeping or storing property outdoors and also expands the panhandling ban to the entire downtown area as well as near banks, ATMs, sidewalk cafes, and bus or trolley stops. It’s aimed at “behaviors that city officials said might make people feel vulnerable or unable to walk away from someone asking for money.”  
Most notably, the restrictions on solicitations apply only to the poor.  There are explicit exemptions for others: those newspaper vendors along with religious groups and political activists. “So while hectoring passersby about the End Times or accosting them with political petitions is protected free speech, no matter how aggressive, vocally asking for money, no matter how politely, is not.”

      Homeless Helping Homeless: the Plaintiff

In 2009, Adolphus Parker created a new organization he called Homeless Helping Homeless (HHH).  It’s the very definition of a “grassroots” effort: a tiny group, run by – and for – the poorest of the poor in Tampa. “The nonprofit’s corporate executives, administrators, and support staff are themselves homeless clients.” 
With 501(c)(3) approval in hand, HHH quickly made progress. By 2015, this band of activists was providing 89 beds at 6 different locations and giving free meals to about 3,000 people each month.
“We give free shelter for people with no money, no job, and who don’t meet criteria for public assistance,” Mr. Parker says of his group. The city doesn’t have enough homeless assistance; overfilled shelters send people to HHH, as do police and hospitals.  There are – 

showers, a place to sleep, lockers, TV, internet, phones, a place to be during the day, a nice cup of coffee in the morning, and, well, the dignity of working for a common cause … The group helps indigent people get birth certificates, IDs and other documents required to secure public aid.

Homeless Helping Homeless operates on contributions; it receives no government funds at all.  “The group sends members to populated parts of the city to collect donations, using locked boxes to ensure the money goes to the organization and not individuals.” It also raises money through social enterprise projects: a cafe, a thrift store, a junk-removal service, a mobile check-cashing service, and an online store that sells the trademarked “Burger Dog Pan.”

   The Federal Lawsuit

In its first few years, Homeless Helping Homeless volunteers solicited donations for the organization without complaint or interference from police. The 2011 and 2013 anti-panhandling laws, though, have taken a toll – at least $20,000 in lost donations by 2015.  The group has been up against restrictions “that other organizations in the city” don’t face. Mr. Parker claims the city of Tampa Bay went out of its way to stop his organization from going about its usual way of raising funds. They –

went and made a new ordinance that says, ‘Okay, you can be downtown, but you can’t hold a sign – [and] You cannot ask, ‘Would you like to make a donation?’  And then they went and signed a new law to put on the books because the big boys – the banks and so forth – don’t really want us downtown. They tried to use other means because we’re legal and we have all the necessary licenses.

By May 2015, Homeless Helping Homeless decided to fight back with a federal lawsuit seeking an injunction blocking the city’s enforcement of the anti-panhandling ordinances.  In the Complaint in U.S. District Court in Tampa Bay, HHH asserts that these ordinances “are unconstitutional” because –  

[t]aken together, the laws restrict speech based on its content, cover an unreasonably broad area, make exceptions for some kinds of speech but not others, and would require the charity’s volunteers to stand mutely with a sign while other conversations go on around them.

According to Brian T. Burgess, Esq., the group’s Washington, D.C., pro bono, attorney: “They think they have just as much a right to be out there engaging in protected speech as someone soliciting for signatures on a petition.”

      Harassment

According to Adolphus Parker, in the weeks and months after the lawsuit began, Homeless Helping Homeless was subjected to a campaign of harassment and intimidation.  Local news stories document police raids, relentless code-enforcement actions, and other attention from city officials and law enforcement.  Government representatives, of course, deny any connection with the litigation.

To tell you the truth … – really, really honestly to tell you the truth – we have tried other options to go in and do it… [As a result]…, we lost all our contracts, and then in retaliation to the lawsuit that we filed against the city, you know what they did? They closed four of our facilities down – four out of six.

“I poked the bear [City of Tampa],” says the founder of Homeless Helping Homeless.  “Now the bear is hitting back. *** It’s not about the facility, it’s about the lawsuit,” Mr. Parker adds, noting that the group had not had previous trouble with the city in connection with the shelters. “‘How dare us sue them?’ he says, sarcastically. ‘They can’t afford for us to win.'”

    The Court’s Ruling

On August 8, 2016, U.S. District Judge Steven Merryday issued his decision in Homeless Helping Homeless v. City of Tampa Bay. He granted an injunction barring government authorities from enforcing the 2013  panhandling ordinance. (The 2011 ordinance had previously been repealed by Tampa Bay as a litigation maneuver; officials believed that the earlier law was more difficult to justify.) 
Judge Merryday ruled that the 2013 law is unconstitutional under the First Amendment because it prohibits one kind of communication – and not others – solely based on content.  He based his decision on Reed v. Town of Gilbert (2014), a U.S. Supreme Court case about a dispute involving parishioners in Gilbert, Arizona, temporarily planting some small signs directing people to church services.  “The provisions of a municipality’s sign code that impose more stringent restrictions on signs directing the public to the meeting of a non-profit group than on signs conveying other messages are content-based regulations of speech that cannot survive strict scrutiny,” according to Justice Clarence Thomas writing for the unanimous Court. 
The City of Tampa Bay has not yet announced its intentions with regard to an appeal.  The men of Homeless Helping Homeless are happy about the ruling, glad to be “vindicated.” But they are not gloating, and won’t “immediately” resume soliciting donations in the areas specified in the ordinance.  They are trying to develop a fundraising strategy that doesn’t rely on solicitations in these locations.  If that’s not possible, though, they will have no choice but to resume those activities.
As for the pro bono law firm, it “now may seek to have City Hall cover its legal fees.”

    Conclusion

According to Malcolm Gladwell, author of “David & Goliath: Underdogs, Misfits and the Art of Battling Giants,” society may have misinterpreted the famous tale all along. “Goliath may have actually been the underdog, not David.”

Why do we call David an underdog? Well, we call him an underdog because he’s a kid, a little kid, and Goliath is this big, strong giant. We also call him an underdog because Goliath is an experienced warrior, and David is just a shepherd. But most importantly, we call him an underdog because Goliath is outfitted with all of this modern weaponry, this glittering coat of armor and a sword and a javelin and a spear, and all David has is this sling.

According to Gladwell, Goliath arrogantly believes he has the power to direct the course of the battle:

’Come to me, that I might feed your flesh to the birds of the heavens and the beasts of the field,’ the key phrase is ‘Come to me.’ Come up to me because we’re going to fight, hand to hand, like this.

But David has other plans, the writer explains. David won’t fight Goliath on the giant’s terms.

He’s not going to fight him that way. Why would he? He’s a shepherd. He’s spent his entire career using a sling to defend his flock against lions and wolves. That’s where his strength lies. So here he is, this shepherd, experienced in the use of a devastating weapon, up against this lumbering giant weighed down by a hundred pounds of armor and these incredibly heavy weapons that are useful only in short-range combat. Goliath is a sitting duck. He doesn’t have a chance.

Is it surprising, really, that – against all apparent odds – Adolphus Parker and his enterprising, determined, and resourceful friends at Homeless Helping Homeless went on to win the day here?