05charitybilltestimony

S. 1074 is a legislative response to the parish reconfiguration process within the Archdiocese of Boston.[1] The bill’s stated goal of promoting transparency raises serious questions.

By removing existing religious exemptions in the state laws governing public charities, the bill would require officers of the Commonwealth to oversee the internal workings of religious entities to an unprecedented degree.

Section 2 of the bill would bring religious entities within the public charity oversight provisions of M.G.L. c. 12, зз 8 to 8M, a section of which directs the Attorney General to “enforce the due application of funds given or appropriated to public charities within the commonwealth and prevent breaches of trust in the administration thereof.” M.G.L. c. 12, з 8. More specifically, “The attorney general, whenever he believes that charitable funds have not been or are not being applied to charitable purposes or that breaches of trust have been or are being committed in the administration of a public charity, may conduct an investigation upon application to and with the approval of a judge of the trial court.” M.G.L. c. 12, з 8H. This investigation could be far-ranging, since the statute authorizes the examination of “any documentary material of whatever nature relevant to such alleged misapplication of charitable funds or breach of trust.” M.G.L. c. 12, з 8H(1)(b). Based on this far-reaching investigation, the attorney general can petition the courts for an order changing any internal operation of the religious entity that the attorney general deems to be contrary to the public trust. M.G.L. c. 12, з 8I.[2]

Thus, S. 1074 contemplates draconian governmental interference with the operation of churches and other religious entities. The bill potentially would subject to the attorney general’s ultimate disapproval all decisions at the diocesan level, such as contested parish closings, that the attorney general might characterize as misapplying charitable donations or breaching the public trust. Similarly, all decisions of a pastor, parish council or individual ministry leaders, would be subject to state review on the same basis as long as someone can claim that these decisions implicate charitable donations or the public trust. The scrutiny would be authorized in another direction as well, extending beyond the operation of a church located in the Commonwealth, to include a review of all property holdings of “any related organization.” See S. 1074, section 1 (requiring annual reports to the attorney general to include “the address of each parcel of real property owned by the public charity and any related organization”). Section 3 defines “related organization” as any entity owned or controlled by, or benefiting or furthering the purposes of and engaging in business transactions with, the reporting entity.

This reporting requirement (applicable to all charities) would be extremely burdensome and would provide yet another investigatory entrщe. The attorney general would be empowered to scrutinize the property holdings of the Vatican, Peter’s Pence, and all other institutions related under the bill’s terms to the Roman Catholic Church in Massachusetts, a part of a world-wide religion, no matter their geographical location.

The reporting of property holdings seems especially wasteful since the information sought, in large part, is already a matter of public record, available for public inspection and accessible on-line. Each year every city and town assessor in the Commonwealth sends to all exempt property owners the "3ABC Form" which the property owner must complete and file with the assessor to maintain the tax exemption. Any individual can search any city or town collector's office website by property owner's name and obtain a listing of all properties owned by a particular individual or entity. Additionally the website of any Registry of Deeds can be searched by grantor and grantee to obtain a listing of all properties sold or acquired by any individual or entity.

The added requirement of full financial annual audits found in the statute (M.G.L. c. 12, з 8F) only increases the already heavy burden imposed by the bill and magnifies the potential for exceedingly intrusive second-guessing by state authorities on an unprecedented scale. The audit requirement alone is estimated to cost the Roman Catholic Archdiocese of Boston in excess of one million ($1,000,000) annually. To require that such resources be diverted into administrative tasks which really provide no direct benefit to those who need the social service programs provided by the church does not make good sense.

The entanglement with religion would be excessive, going far beyond any “routine regulatory interaction”[3] and thus raises substantial First Amendment concerns.[4] The United States Supreme Court in Waltz v. Tax Commissioner of the City of New York, 397 U.S. 664 (1970), held that a local property tax exemption to property owned by religious institutions, did not violate the Establishment Clause of the First Amendment. In his decision for the majority Chief Justice Warren Burger, stated that "The elimination of the exemption would tend to expand the involvement of government by giving rise to tax valuation of church property, tax liens, tax foreclosures and the direct confrontations and conflicts that follow in the train of those legal processes." Legal scholars have interpreted Justice Burger's statement to mean that it is not necessarily the elimination of the exemption which would cause excessive government entanglement with religion, but rather the government's potential involvement with religious entities as a result of the elimination of the exception, which would violate the Establishment Clause of the First Amendment. The elimination of the religious exemption under M.G.L. c. 12, з 8 as is proposed in S. 1074 will result in excessive government entanglement with religious entities in Massachusetts.

For the reasons stated in this testimony, the Conference respectfully urges the Committee to give S. 1074 an adverse report.

The Massachusetts Catholic Conference is the public policy office of the Roman Catholic Bishops in the Commonwealth, representing the Archdiocese of Boston and the Dioceses of Fall River, Springfield, and Worcester.

[1] See Sen. Marian Walsh, Dear Colleague Letter, Aug. 16, 2004 (tying introduction of the bill to “the recent events with the Archdiocese, and particularly, the closure and potential sale of income generating assets” including a parish in her district).

[2] Section 4 of the bill would expose religious entities to similar investigatory incursions by the attorney general under chapter 68 concerning charitable fundraising. See M.G.L. c. 68, з 30 (authorizing investigation that examines “any documentary material of whatever nature relevant to such alleged violations or false or misleading information”) & M.G.L. c. 68, з 32 (authorizing penalties and court injunctions).

[3] Attachment to Marian Walsh’s “Dear Colleague Letter,” supra, at 4.

[4] Larson v. Valente, 456 U.S. 228, 252 (1982) (indicating that “a statute must not foster an excessive governmental entanglement with religion”). See also Surinach v. Pesquera de Busquets, 604 F.2d 73, 76-78 (1st Cir. 1979) (consumer affairs agency ordered parochial schools to produce documents and information concerning all aspects of schools' finances as part of agency review preparatory to imposition of cost controls; schools entitled to injunctive relief from orders to produce because "eventual use to which the school's cost information could be put could interfere seriously with [the school's] religious duties and objectives").

Senator Creedon, Representative O’Flaherty, members of the committee, thank you for the opportunity to testify today. My name is Laura Everett, program associate for the Massachusetts Council of Churches. I am testifying on behalf of the board of directors of the Massachusetts Council of Churches. The Massachusetts Council of Churches is an ecumenical partnership of seventeen Orthodox and Protestant denominations in the Commonwealth with more than 1700 affiliated congregations. The Massachusetts Council of Churches board of directors is made up of representatives from the seventeen different denominations. In December 2004, the board of directors voted to oppose Senate Bill 1074 for reasons of both principle and practice. We understand that the Jewish Community Relations Council and the Massachusetts Catholic Conference have grave concerns similar to ours.

When the Council’s Board of Directors discussed this bill at its December meeting, the members (slightly more than half clergy, half laity) voiced vigorous concern about the impact of the legislation on the congregations with which they are familiar in their various settings. They did so on the basis of logistical hassles for already overburdened staff and volunteers. And this was before we had received a sample copy of a “simple” thirteen page form as an illustration of reporting for congregations of modest size.

Congregations of our member-denominations vary significantly in size. Some have as few as forty or fifty members, with bi-vocational pastors who hold secular jobs with their ministry, no other staff, and modest budgets. Many are “mid-sized”—i.e. with one hundred members. Thus, the concerns articulated by this sample of clergy and laity about the practical effects of such legislation are real and legitimate.

The more fundamental basis that the Massachusetts Council of Churches opposes this legislation, however, is on the principle of religious liberty. This issue may be more challenging for the general public to comprehend, but it is the overarching basis on which this proposal would make bad law.

There has been some slippage in the language around this legislation that seems to obscure the issue of religious liberty. While the Senator’s bill is titled “An Act Relative to Charities in Massachusetts” the bill is not about charities; it is about churches. In the legally broad sense, churches are given a charitable non-profit categorization, but because churches are so much more than that to think of them simply as religiously minded charities is reductionist. Churches, unlike other so-called eleemosynary institutions, do not have this unique status because of their “good works” or their charitable concerns. While churches often do good works, their primary purpose is religious. Churches have this unique status because of the well-established and constitutional concern for religious freedom. When we use ‘charities’ language, we obscure the true nature of the church and true effect of the proposed legislation.

Religious liberty is a real concern with this legislation. Many Christian churches (as well as people of other faiths) have deep and bitter historical memories from having experienced undue influence by the state in the affairs of the church. This has happened, for example, through an arbitrary exercise of power by a dominant majority religious body, or by a secular state without appreciation for or tolerance of religious liberty. Thus, churches are wary of giving the state unnecessarily intrusive powers in their internal workings. From the perspective of the Massachusetts Council of Churches, the requirements and effects of this legislation are excessively and unnecessarily intrusive and constitute excessive entanglement.

The office of the Attorney General already has the right and the power to intervene in church matters with legitimate reason to suspect that laws have been broken. In fact, it has done so on occasion. This should be sufficient for the legitimate interests of government.

Most –probably all--of our member-churches have participatory involvement by their members in finances. Although the forms of church governance vary considerably, we are committed to transparency. In many cases sizeable representative groups oversee and vote on operating budgets. Thus, financial information already is transparent. We will continue to advocate for voluntary transparency, however, rather than required reporting, for reasons of religious freedom. Churches are called to conduct their internal workings responsibly. They should be free to order themselves according to their religious convictions about such matters, free of government intrusion. Where members of churches have concerns about the internal systems of authority and oversight of financial matters, these are best addressed by the members and churches themselves, in keeping with principles of religious liberty.

Finally, we are concerned about the impropriety of using the legislative arm of government to deal with a recent internal dispute in one denomination, in this case the Roman Catholic Church. This legislation would constitute an unwarranted intrusion and excessive entanglement in the lives of all churches, mosques, temples and synagogues. It would set dangerous precedent for potential use of the state legislature to mediate internal religious conflict of one particular church. If the makeup of the General Court were reversed, with a majority of Protestant and Orthodox legislators rather than Roman Catholics, as was the case in the early 19^th century, would it be appropriate to legislate the internal workings of one Protestant denomination in ways that might have harmful effects on a Catholic minority? When the tables are turned, the error of this proposed legislation comes into sharp relief. Intervening like this in an internal dispute of one religious tradition is not the role of government.