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Montana Supreme Court Directs District Court To Rule in Favor of Espinoza Parents, Clearing Way for Program to Continue

Arlington, Va.—Today, the Montana Supreme Court officially recognized that three Kalispell mothers successfully protected Montana’s tax credit scholarship program.  The program has been the subject of contentious litigation since the Montana legislature passed the program five years ago and the Montana Supreme Court invalidated the program in 2018.  The litigation culminated in the landmark U.S. Supreme Court ruling in Espinoza v. Montana Department of Revenue, in which the Court ruled in favor of the program on June 30, 2020.  Today, the Montana Supreme Court remanded the case to the state district court with instructions to enter judgment in favor of the three mothers.  As a result, the program can continue awarding scholarships to needy families, free of legal uncertainty.

The lawsuit started in 2015 after the Montana Department of Revenue enacted a rule limiting scholarships to children attending nonreligious schools.  Three low-income mothers who wanted to use the scholarships at a religious school sued, represented by the nonprofit law firm, the Institute for Justice.  The mothers claimed that the department’s rule was invalid because the legislature intended the program to help children attend any private school, whether religious or nonreligious.  The mothers also argued that excluding religious options from the program violated their religious liberty under the U.S. Constitution.

Although the mothers won at the district court, the Department of Revenue appealed, leading the Montana Supreme Court to invalidate the entire program for children attending both religious and nonreligious schools.  The Court held that invalidating the program was the only way to prevent scholarships to children attending religious schools, which the court found violated the Montana Constitution.  On June 30, the U.S. Supreme Court reversed, holding that invalidating the program for including religious options violated the Free Exercise rights of both religious schools and the families who attended them.

Some speculated, however, that the Department of Revenue may try to persuade the Montana Supreme Court to invalidate the program on other grounds.  The department declined to do so, and the case is now coming to a close.

“Montana families can now rest easy knowing that the scholarship program is here to stay,” said Erica Smith, a senior attorney at the Institute for Justice and co-counsel for the parents.  “Every child deserves to go to the school that is best for them, regardless of their zip code and their parents’ income.”

Those wishing to donate to the tax credit scholarship program can go to: https://bigskyscholarships.org/

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