Oregon youth ministry fights for funding in federal appeals court

An Oregon youth ministry argued to a federal appeals court Wednesday that the state unlawfully stripped it of several grants because of its practice of hiring staff and volunteers who hold Biblical beliefs.

A panel of three judges for the 9th U.S. Circuit Court of Appeals will now decide if Youth 71Five Ministries can receive funding from the state Department of Education.

For 60 years, the southwest Oregon mentoring program has served at-risk youth with Christ-centered programs. The ministry hires employees and volunteers who align with 71Five’s mission and beliefs, said Bud Amundsen, executive director of the ministry. Its approximately 30 employees and 100 volunteers all signed a statement of faith before joining.

For five years, the ministry applied and received multiple grants from the Oregon Department of Education’s Youth Community Investment Grant Program.

However, for the 2023-25 grant cycle, the application form added a new requirement that asked applicants to check a box certifying they “do not discriminate” in their hiring practices regarding religion. The ministry checked the box, confident that its religious hiring practices are legally protected under the First Amendment and not discriminatory.

While the state Department of Education initially awarded 71Five several grants worth over $400,000 in July 2023, it revoked this funding a few months later. The department said the nonprofit was disqualified because of its hiring practices.

“Having 10% of your budget pulled in a way in which it blinded us—it was detrimental to our financial position,” Amundsen said. “Having that funding pulled just really stopped us, and staff had to focus more on fundraising.”

Without these funds, the nonprofit has put on hold repairing a youth center, replacing old bikes and safety equipment for its youth mountain-biking program, and expanding its career exploration program, according to a legal brief.

In March of this year, 71Five sued the department, asking a district court to uphold its First Amendment rights. It also asked the court to temporarily restore the nonprofit’s funding until the lawsuit is resolved.

The district court denied the request for the injunction in June, stating that Oregon had qualified immunity and was protected from liability because the state did not violate a clearly established constitutional right. The court concluded that the nondiscrimination requirement was neutral and generally applicable and that the department did not deny funding because of the nonprofit’s religious character.

The court also concluded that the ministry could not raise a defense under the “church autonomy doctrine.” The First Amendment-derived doctrine protects churches and religious organizations from courts’ second-guessing of their decisions as to church doctrine or governance.

A month later, 71Five appealed the decision to the 9th Circuit Court of Appeals.

The ministry contended that the department singled it out. Of 81 grants awarded during the 2023-25 cycle, 71Five was the only recipient that had its grants taken away, according to the ministry.

In a later legal brief, 71Five pointed out that, while it hires employees with similar beliefs, it serves youth from all backgrounds. The nonprofit contended some of the other grant recipients “discriminate when providing their services,” such as a program that serves only girls, not boys.

In August, the 9th Circuit granted an emergency motion and allowed the ministry to have temporary access to the state funding.

Now, 71Five is asking judges to extend access to that funding while the underlying case is pending.

Judges peppered both sides with numerous questions during the oral arguments.

Opening for 71Five, Alliance Defending Freedom attorney Jeremiah Galus argued that Oregon’s actions violated First Amendment rights and wrongfully singled out 71Five from secular organizations.

Galus reiterated 71Five’s point that it serves all youth while other organizations funded by the department do not. “There might be good intentions, good reasons for why the government would allow a secular grantee to have these types of policies, but good intentions do not change the fact that the government is still favoring secular conduct over religious exercise,” he said.

The judges questioned Galus’ evidence showing that other organizations had discriminatory services, asking for more concrete evidence than the screenshots ADF had provided earlier in the filing process.

Galus pointed out that at the preliminary injunction stage, the evidentiary standard is more lenient.

Representing Oregon, attorney Kirsten Naito repeatedly argued the state doesn’t require nonprofits to retain or hire certain staff. Because of that, the grant requirements don’t burden 71Five’s religious rights.

However, Circuit Judge Morgan Christen noted that the nonprofits essentially are required to hire certain people if they want to apply for the grants in question.

“They are free to hire whomever they want so long as they don’t expect to get the grant funding from [us],” Naito said.

Both sides’ arguments hinged heavily on contrasting interpretations of a 2017 U.S. Supreme Court case, Trinity Lutheran Church of Columbia, Inc. v. Comer, in which the court ruled that states can’t deny grants to any applicant run by a church because it is religious.

Galus argued this case directly compares to 71Five’s story, while Naito said the policies in question in Trinity Lutheran, unlike Oregon’s, directly targeted religious organizations.

Reflecting on the arguments, Galus told WORLD that Oregon government officials are questioning rights that haven’t been questioned for years. He said it should be clear that 71Five is protected under multiple constitutional rights. The First Amendment’s ministerial protections protect 71Five’s religious hiring rights while multiple Supreme Court cases, like Trinity Lutheran, demonstrate religious organization’s right to funding programs.

“71Five serves everybody in the community,” Galus said. “All it’s asking is it be allowed to do what the Constitution allows, and also what Oregon state law allows, which is to prefer members of its own faith in employment.”

Amundsen said that, while the case has been ongoing, 71Five has been “just trying to survive.”

“It’s been a hectic year,” he said. “There have been dark days where I’m simply wondering if I can keep families on staff and keep the number of kids coming into the program that we have.”