The Text of the Supreme Court’s Decision In the Minnesota Tuition Tax-Deduction Case

Following is the text of the U.S. Supreme Court’s decision in the case Mueller v. Allen, in which the Court upheld a Minnesota law that grants state income-tax deductions for educational expenses incurred by parents of students enrolled in public or private schools. The entire texts of the majority opinion by Associate Justice William H. Rehnquist and the dissenting opinion by Associate Justice Thurgood Marshall are included. In the pages that follow, single asterisks in brackets [

• ] denote footnotes that have been omitted; double asterisks [
• ] denote legal citations omitted. Remaining footnotes appear at the end of each opinion.

An educated populace is essential to thepolitical and economic health of any community,and a state’s efforts to assist parents in meetingthe rising cost of educational expenses plainlyserves this secular purpose of ensuring thatthe state’s citizenry is well-educated.

Justice Rehnquist delivered the opinion of the Court.

Minnesota allows taxpayers, in computing their state income tax, to deduct certain expenses incurred in providing for the education of their children. Minn. Stat. 290.09(22). The United States Court of Appeals for the Eighth Circuit held that the Establishment Clause of the First and Fourteenth Amendments was not offended by this arrangement. Because this question was reserved in Committee for Public Education v.Nyquist, 413 U.S. 756 (1973), and because of a conflict between the decision of the Court of Appeals for the Eighth Circuit and that of the Court of Appeals for the First Circuit in Rhode Island Federation of Teachers v.Norberg, 630 F. 2d 855 (CA1 1980), we granted certiorari. [

• ] We now affirm.

Minnesota, like every other state, provides its citizens with free elementary and secondary schooling. [

• ] It seems to be agreed that about 820,000 students attended this school system in the most recent school year. During the same year, approximately 91,000 elementary and secondary students attended some 500 privately supported schools located in Minnesota, and about 95% of these students attended schools considering themselves to be sectarian.

Minnesota, by a law originally enacted in 1955 and revised in 1976 and again in 1978, permits state taxpayers to claim a deduction from gross income for certain expenses incurred in educating their children. The deduction is limited to actual expenses incurred for the “tuition, textbooks, and transportation” of dependents attending elementary or secondary schools. A deduction may not exceed $500 per dependent in grades K through six and $700 per dependent in grades seven through twelve. [

• ]

Petitioners--certain Minnesota taxpayers--sued in the United States District Court for the District of Minnesota claiming that 290.09(22) violated the Establishment Clause by providing financial assistance to sectarian institutions. They named as respondents the Commissioner of the Department of Revenue of Minnesota and several parents who took advantage of the tax deduction for expenses incurred in sending their children to parochial schools. The District Court granted respondent’s motion for summary judgment, holding that the statute was “neutral on its face and in its application and does not have a primary effect of either advancing or inhibiting religion.” 514 F. Supp. 998, 1003 (D Minn. 1981). On appeal, the Court of Appeals affirmed, concluding that the Minnesota statute substantially benefited a “broad class of Minnesota citizens.”

Today’s case is no exception to our oft-repeated statement that the Establishment Clause presents especially difficult questions of interpretation and application. It is easy enough to quote the few words comprising that clause--"Congress shall make no law respecting an establishment of religion.” It is not at all easy, however, [to] apply this Court’s various decisions construing the Clause to governmental programs of financial assistance to sectarian schools and the parents of children attending those schools. Indeed, in many of these decisions “we have expressly or implicitly acknowledged that ‘we can only dimly perceive the lines of demarcation in this extraordinarily sensitive area of constitutional law.”’ Lemon v.Kurtzman, 403 U.S. 609, 612 (1971), quoted with approval in Nyquist [

• ].

One fixed principle in this field is our consistent rejection of the argument that “any program which in some manner aids an institution with a religious affiliation” violates the Establishment Clause. Hunt v. McNair, 413 U.S. 734, 742 (1973). See, e.g., Bradfield v. Roberts, 175 U.S. 291 (1899); Walz v. Tax Commission, 397 U.S. 664 (1970). For example, it is now well-established that a state may reimburse parents for expenses incurred in transporting their children to school, Everson v. Board of Education, 330 U.S. 1 (1947), and that it may loan secular textbooks to all schoolchildren within the state, Board of Education v.Allen, 392 U.S. 236 (1968).

Notwithstanding the repeated approval given programs such as those in Allen and Everson, our decisions also have struck down arrangements resembling, in many respects, these forms of assistance. See, e.g., Lemon v. Kurtzman, supra; Levitt v. Committee for Public Education, 413 U.S. 472 (1972); Meek v. Pittenger, 421 U.S. 349 (1975); Wolman v. Walter, 433 U.S. 229, 237-238 (1977). In this case we are asked to decide whether Minnesota’s tax deduction bears greater resemblance to those types of assistance to parochial schools we have approved, or to those we have struck down. Petitioners place particular reliance on our decision in Committee for Public Education v. Nyquist, where we held invalid a New York statute providing public funds for the maintenance and repair of the physical facilities of private schools and granting thinly disguised “tax benefits,” actually amounting to tuition grants, to the parents of children attending private schools. As explained below, we conclude that 290.09(22) bears less resemblance to the arrangement struck down in Nyquist than it does to assistance programs upheld in our prior decisions and those discussed with approval in Nyquist.

The general nature of our inquiry in this area has been guided, since the decision in Lemon v. Kurtzman [

• ], by the “three-part” test laid down in that case:

“First, the statute must have a secular legislative purpose; second, its principle or primary effect must be one that neither advances nor inhibits religion ...; finally, the statute must not foster ‘an excessive government entanglement with religion.”’ [

• ]

While this principle is well settled, our cases have also emphasized that it provides “no more than [a] helpful signpost” in dealing with Establishment Clause challenges. Hunt v. McNair [

• ]. With this caveat in mind, we turn to the specific challenges raised against 290.09(22) under the Lemon framework.

Little time need be spent on the question of whether the Minnesota tax deduction has a secular purpose. Under our prior decisions, governmental assistance programs have consistently survived this inquiry even when they have run afoul of other aspects of the Lemon framework. [

• ] This reflects, at least in part, our reluctance to attribute unconstitutional motives to the states, particularly when a plausible secular purpose for the state’s program may be discerned from the face of the statute.

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. An educated populace is essential to the political and economic health of any community, and a state’s efforts to assist parents in meeting the rising cost of educational expenses plainly serves this secular purpose of ensuring that the state’s citizenry is well-educated. Similarly, Minnesota, like other states, could conclude that there is a strong public interest in assuring the continued financial health of private schools, both sectarian and non-sectarian. By educating a substantial number of students such schools relieve public schools of a correspondingly great burden--to the benefit of all taxpayers. In addition, private schools may serve as a benchmark for public schools, in a manner analogous to the “tva yardstick” for private power companies. As Justice Powell has remarked:

“Parochial schools, quite apart from their sectarian purpose, have provided an educational alternative for millions of young Americans; they often afford wholesome competition with our public schools; and in some States they relieve substantially the tax burden incident to the operation of public schools. The State has, moreover, a legitimate interest in facilitating education of the highest quality for all children within its boundaries, whatever school their parents have chosen for them. Wolman v.Walter [

• ].

All these justifications are readily available to support 290.09(22), and each is sufficient to satisfy the secular purpose inquiry of Lemon.

We turn therefore to the more difficult but related question of whether the Minnesota statute has “the primary effect of advancing the sectarian aims of the nonpublic schools.” Committee for Public Education v. Regan, 444 U.S. 646, 662 (1980); Lemon v. Kurtzman [

• ]. In concluding that it does not, we find several features of the Minnesota tax deduction particularly significant. First, an essential feature of Minnesota’s arrangement is the fact that 290.09(22) is only one among many deductions--such as those for medical expenses [
• ], and charitable contributions, [
• ] --available under the Minnesota tax laws[
• ]. Our decisions consistently have recognized that traditionally "[l]egislatures have especially broad latitude in creating classifications and distinctions in tax statutes,” Regan v. Taxation with Representation [
• ], in part because the “familiarity with local conditions” enjoyed by legislators especially enables them to “achieve an equitable distribution of the tax burden.” Madden v. Kentucky. [
• ] Under our prior decisions, the Minnesota legislature’s judgment that a deduction for education expenses fairly equalizes the tax burden of its citizens and encourages desirable expenditures for educational purposes is entitled to substantial deference.

Other characteristics of 290.09(22) argue equally strongly for the provision’s constitutionality. Most importantly, the deduction is available for educational expenses incurred by all parents, including those whose children attend public schools and those whose children attend non-sectarian private schools or sectarian private schools. Just as in Widmar v. Vincent [

• ], where we concluded that the state’s provision of a forum neutrally “open to a broad class of nonreligious as well as religious speakers” does not “confer any imprimatur of State approval,” so here: “the provision of benefits to so broad a spectrum of groups is an important index of secular effect.”

In this respect, as well as others, this case is vitally different from the scheme struck down in Nyquist. There, public assistance amounting to tuition grants, was provided only to parents of children in nonpublic schools. This fact had considerable bearing on our decision striking down the New York statute at issue; we explicitly distinguished both Allen and Everson on the grounds that “In both cases the class of beneficiaries included all schoolchildren, those in public as well as those in private schools."[

• ] [
• ] Moreover, we intimated that “public assistance (e.g., scholarships) made available generally without regard to the sectarian-nonsectarian or public-non-public nature of the institution benefited,” ibid., might not offend the Establishment Clause. We think the tax deduction adopted by Minnesota is more similar to this latter type of program than it is to the arrangement struck down in Nyquist. Unlike the assistance at issue in Nyquist, 290.09(22), permits all parents--whether their children attend public school or private--to deduct their children’s educational expenses. As Widmar and our other decisions indicate, a program, like 290.09(22), that neutrally provides state assistance to a broad spectrum of citizens is not readily subject to challenge under the Establishment Clause.

We also agree with the Court of Appeals that, by channeling whatever assistance it may provide to parochial schools through individual parents, Minnesota has reduced the Establishment Clause objections to which its action is subject. It is true, of course, that financial assistance provided to parents ultimately has an economic effect comparable to that of aid given directly to the schools attended by their children. It is also true, however, that under Minnesota’s arrangement public funds become available only as a result of numerous, private choices of individual parents of school-age children. For these reasons, we recognized in Nyquist that the means by which state assistance flows to private schools is of some importance: we said that “the fact that aid is disbursed to parents rather than to ... schools” is a material consideration in Establishment Clause analysis, albeit “only one among many to be considered.” [

• ] It is noteworthy that all but one of our recent cases invalidating state aid to parochial schools have involved the direct transmission of assistance from the state to the schools themselves. The exception, of course, was Nyquist, which, as discussed previously, is distinguishable from this case on other grounds. Where, as here, aid to parochial schools is available only as a result of decisions of individual parents on “imprimatur of State approval,” Widmar can be deemed to have been conferred on any particular religion, or on religion generally.

We find it useful, in the light of the foregoing characteristics of 290.09(22), to compare the attenuated financial benefits flowing to parochial schools from the section to the evils against which the Establishment Clause was designed to protect. These dangers are well-described by our statement that “what is at stake as a matter of policy [in Establishment Clause cases] is preventing that kind and degree of government involvement in religious life that, as history teaches us, is apt to lead to strife and frequently strain a political system to the breaking point.” Nyquist [

• ], quoting, Walz v. Tax Comm’n [
• ]. It is important, however, to “keep these issues in perspective":

“At this point in the 20th century we are quite far removed from the dangers that prompted the Framers to include the Establishment Clause in the Bill of Rights. See Walz v. Tax Comm’n [

• ].The risk of significant religious or denominational control over our democratic processes--or even of deep political division along religious lines--is remote, and when viewed against the positive contributions of sectarian schools, and such risk seems entirely tolerable in light of the continuing oversight of this Court.” Wolman, at 263 (Powell, J., concurring in part, concurring in the judgment in part, and dissenting in part).

The Establishment Clause of course extends beyond prohibition of a state church or payment of state funds to one or more churches. We do not think, however, that its prohibition extends to the type of tax deduction established by Minnesota. The historic purposes of the clause do not encompass the sort of attenuated financial benefit, ultimately controlled by the private choices of individual parents, that eventually flows to parochial schools from the neutrally available tax benefits at issue in this case.

Petitioners argue that, notwithstanding the facial neutrality of 290.09(22), in application the statute primarily benefits religious institutions.[

• ] Petitioners rely, as they did below, on a statistical analysis of the type of persons claiming the tax deduction. They contend that most parents of public school children incur no tuition expenses [
• ], and that other expenses deductible under 290.09(22) are negligible in value; moreover, they claim that 96% of the children in private schools in 1978-79 attended religiously-affiliated institutions. Because of all this, they reason, the bulk of deductions taken under 290.09(22) will be claimed by parents of children in sectarian schools. Respondents reply that petitioners have failed to consider the impact of deductions for items such as transportation, summer school tuition, tuition paid by parents whose children attended schools outside the school districts in which they resided, rental or purchase costs for a variety of equipment, and tuition for certain types of instruction not ordinarily provided in public schools.

We need not consider these contentions in detail. We 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 of private citizens claimed benefits under the law. Such an approach would scarcely provide the certainty that this field stands in need of, nor can we perceive principled standards by which such statistical evidence might be evaluated. Moreover, the fact that private persons fail in a particular year to claim the tax relief to which they are entitled--under a facially neutral statute--should be of little importance in determining the constitutionality of the statute permitting such relief.

Finally, private educational institutions, and parents paying for their children to attend these schools, make special contributions to the areas in which they operate. “Parochial schools, quite apart from their sectarian purpose, have provided an educational alternative for millions of young Americans; they often afford wholesome competition with our public schools; and in some States they relieve substantially the tax burden incident to the operation of public school,” Wolman [

• ]. If parents of children in private schools choose to take especial advantage of the relief provided by 290.09(22), it is no doubt due to the fact that they bear a particularly great financial burden in educating their children. More fundamentally, whatever unequal effect may be attributed to the statutory classification can fairly be regarded as a rough return for the benefits, discussed above, provided to the state and all taxpayers by parents sending their children to parochial schools. In the light of all this, we believe it wiser to decline to engage in the type of empirical inquiry into those persons benefited by state law which petitioners urge.

Thus, we hold that the Minnesota tax deduction for educational expenses satisfies the primary effect inquiry of our Establishment Clause cases.

Turning to the third part of the Lemon inquiry, we have no difficulty in concluding that the Minnesota statute does not “excessively entangle” the state in religion. The only plausible source of the “comprehensive, discriminating, and continuing state surveillance,” [

• ] necessary to run afoul of this standard would lie in the fact that state officials must determine whether particular textbooks qualify for a deduction. In making this decision, state officials must disallow deductions taken from “instructional books and materials used in the teaching of religious tenets, doctrines or worship, the purpose of which is to inculcate such tenets, doctrines or worship.” [
• ] Making decisions such as this does not differ substantially from making the types of decisions approved in earlier opinions of this Court. In Board of Education v.Allen [
• ], for example, the Court upheld the loan of secular textbooks to parents or children attending nonpublic schools; though state officials were required to determine whether particular books were or were not secular, the system was held not to violate the Establishment Clause. See also Wolman v. Walter, supra; Meek v. Pittenger, supra. The same result follows in this case.

For the foregoing reasons, the judgment of the Court of Appeals is

Affirmed.

[Minnesota Law] permits a taxpayer to deduct from his or her computation of gross income the following:

Tuition and transportation expense. The amount he has paid to others, not to exceed $500 for each dependent in grades K to 6 and $700 for each dependent in grades 7 to 12, for tuition, textbooks and transportation of each dependent in attending an elementary or secondary school situated in Minnesota, North Dakota, South Dakota, Iowa, or Wisconsin, wherein a resident of this state may legally fulfill the state’s compulsory attendance laws, which is not operated for profit, and which adheres to the provisions of the Civil Rights Act of 1964 and chapter 363. As used in this subdivision, “textbooks” shall mean and include books and other instructional materials and equipment used in elementary and secondary schools in teaching only those subjects legally and commonly taught in public elementary and secondary schools in this state and shall not include instructional books and materials used in the teaching of religious tenets, doctrines or worship, the purpose of which is to inculcate such tenets, doctrines or worship, nor shall it include such books or materials for, or transportation to, extracurricular activities including sporting events, musical or dramatic events, speech activities, driver’s education, or programs of a similar nature.”

Both lower courts found that the statute permits deduction of a range of education expenses. The District Court found that deductible expenses included:

“1. Tuition in the ordinary sense.

2. Tuition to public school students who attend public schools outside their residence school districts.

3. Certain summer school tuition.

4. Tuition charges by a school for slow learner private tutoring services.

5. Tuition for instruction provided by an elementary or secondary school to students who are physically unable to attend classes at such school.

6. Tuition charged by a private tutor or by a school that is not an elementary or secondary school if the instruction is acceptable for credit in an elementary or secondary school.

7. Montessori School tuition for grades K through 12.

8. Tuition for driver education when it is part of the school curriculum.” [

• ]

The Court of Appeals concurred in this finding.

In addition, the District Court found that the statutory deduction for “textbooks” included not only “secular textbooks"; but also:

“1. Cost of tennis shoes and sweatsuits for physical education.

2. Camera rental fees paid to the school for photography classes.

3. Ice skates rental fee paid to the school for calculators for mathematics classes.

5. Costs of home economics materials needed to meet minimum requirements.

6. Costs of special metal or wood needed to meet minimum requirements of shop classes.

7. Costs of supplies needed to meet minimum requirements of art classes.

8. Rental fees paid to the school for musical instruments.

9. Cost of pencils and special notebooks required for class.” [

• ]

The Court of Appeals accepted this finding.

In Lemon v. Kurtzman [

• ], the Court concluded that the state’s reimbursement of nonpublic schools for the cost of teachers’ salaries, textbooks, and instructional materials, and its payment of a salary supplement to teachers in nonpublic schools, resulted in excessive entanglement of church and state. In Levitt v. Committee for Public Education [
• ], we struck down on Establishment Clause grounds a state program reimbursing nonpublic schools for the cost of teacher-prepared examinations. Finally, in Meek v. Pittenger [
• ], and Wolman v. Walter [
• ], we held unconstitutional a direct loan of instructional materials to nonpublic schools, while upholding the loan of textbooks to individual students.

Section 290.09(22) contains no express statements of legislative purpose, and its legislative history offers few unambiguous indications of actual intent. The absence of such evidence does not affect our treatment of the statute.

Our decison in Nyquist is not to the contrary on this point. We expressed considerable doubt there that the “tax benefits” provided by New York law properly could be regarded as parts of a genuine system of tax laws. Plainly, the outright grants to low-income parents did not take the form of ordinary tax benefits. As to the benefits provided to middle-income parents, the Court said:

“The amount of the deduction is unrelated to the amount of money actually expended by any parent on tuition, but is calculated on the basis of a formula contained by the statute. The formula is apparently the product of a legislative attempt to assure that each family would receive a carefully estimated net benefit, and that the tax benefit would be comparable to, and compatible with, the tuition grant for lower income families.”

Indeed, the question whether a program having the elements of a “genuine tax deduction” would be constitutionally acceptable was expressly reserved in Nyquist [

• ]. While the economic consequences of the program in Nyquist and that in this case may be difficult to distinguish, we have recognized on other occasions that “the form of the [state’s assistance to parochial schools must be examined] for the light that it casts on the substance.” Lemon v. Kurtzman [
• ]. The fact that the Minnesota plan embodies a “genuine tax deduction” is thus of some relevance, especially given the traditional rule of deference accorded legislative classifications in tax statutes.

Likewise, in Sloan v. Lemon [

• ], where we held that a Pennsylvania statute violated the First Amendment, we emphasized that “the State [had] singled out a class of its citizens for a special economic benefit.” We also observed in Widmar that “empirical evidence that religious groups will dominate [the school’s] open forum,” might be relevant under the Establishment Clause.[
• ]

Our conclusion is unaffected by the fact that 290.09(22) permits deductions for amounts spent for textbooks and transportation as well as tuition. In Everson v. Board of Education [

• ], we approved a statute reimbursing parents of all schoolchildren for the costs of transporting their children to school. Doing so by means of a deduction, rather than a direct grant, only serves to make the state’s action less objectionable. Likewise, in Board of Education v. Allen [
• ], we approved state loans of textbooks to all schoolchildren; although we disapproved, in Meek v. Pittenger and Wolman v. Walter direct loans of instructional materials to secular schools, we do not find those cases controlling. First, they involved assistance provided to the schools themselves, rather than tax benefits directed to individual parents [
• ]. Moreover, we think that state assistance for the rental of calculators [
• ], ice skates [
• ], tennis shoes [
• ], and the like, scarcely poses the type of dangers against which the Establishment Clause was intended to guard.

o party to this litigation has urged that the Minnesota plan is invalid because it runs afoul of the rather elusive inquiry, subsumed under the third part of the Lemon test, whether the Minnesota statute partakes of the “divisive political potential” condemned in Lemon [

• ]. The argument is advanced, however, by amicus National Committee for Public Education and Religious Liberty et al. This variation of the “entanglement” has been interpreted differently in different cases. [
• ] Since this aspect of the “entanglement” inquiry originated with Lemon v. Kurtzman [
• ], and the Court’s opinion there took pains to distinguish both Everson v. Board of Education [
• ], and Board of Education v. Allen [
• ], the court in Lemon must have been referring to a phenomenon which, although present in that case, would have been absent in the two cases it distinguished.

The Court’s language in Lemon I respecting political divisiveness was made in the context of Pennsylvania and Rhode Island statutes which provided for either direct payments of, or reimbursement of, a proportion of teachers’ salaries in parochial schools. We think, in the light of the treatment of the point in later cases discussed above, the language must be regarded as confined to cases where direct financial subsidies are paid to parochial schools or to teachers in parochial schools.