Maine is allowed to exclude Catholic schools and other private institutions from public funding if the schools refuse to abide by gender- and sexuality-related nondiscrimination laws, a federal appeals court said this month.
The U.S. Court of Appeals for the 1st Circuit on July 2 ruled against St. Dominic Academy in the Diocese of Portland, denying the school's request for an injunction against Maine's LGBT-related nondiscrimination rules. If granted, the injunction would have allowed the school to access public funding streams.
The school had argued against requirements that it facilitate student "gender transitions" and had said it would not require staff to refer to students by opposite-sex pronouns.
The court, however, said that "combatting sexual-orientation and gender-identity discrimination" is a "legitimate governmental pursuit" and that requiring publicly funded schools to follow those rules "rationally relates" to that pursuit.
Such schools are also required to publicly affirm the "gender identity" of their students, the court said.
The ruling comes several years after the U.S. Supreme Court ruled that Maine could not ban students from using public student aid to attend religious schools. The high court ruled that the state in its policy "identif[ied] and exclude[d] otherwise eligible schools on the basis of their religious exercise."
A "neutral benefit program in which public funds flow to religious organizations through the independent choices of private benefit recipients" does not violate the U.S. Constitution, the court held in the 2022 case Carson v. Makin.
Adèle Keim, an attorney with the Becket Fund for Religious Liberty, which is representing the Catholic school in the suit, told EWTN News that ahead of the Carson decision Maine moved to alter its public funding policy to include the rules regarding gender and sexuality nondiscrimination.
"They knew it would be a red line for the schools that had been suing the state," she said.
Keim said this month's appeals court ruling was partially favorable to St. Dominic Academy; it found, for instance, that the state cannot dictate faith-related hiring practices and cannot dictate religious expression rules on school campuses.
Yet the appeals court ruled that schools enjoy "no constitutional protection" related to the nondiscrimination policies, she said. She argued that the decision runs afoul of multiple Supreme Court decisions, including the Carson ruling along with the landmark 2025 decision in Mahmoud v. Taylor.
The schools could mount a bid to the Supreme Court over the appeals decision, she said.
A similar lawsuit had been brought by the nondenominational Crosspoint Church, which runs a K–12 Christian school. The appeals court had partly combined the suits of the respective churches into one ruling.
Keim said that Catholic education had been publicly funded for decades in Maine before lawmakers in the early 1980s targeted Catholic schools for exclusion.
"It's a [sparsely populated] state," she said. "Its population is spread out over a large territory. The government has always partnered with private schools to get the job done of meeting the state constitutional guarantee of free education for all kids."
She said the parts of the appeals court ruling that found in favor of the Catholic schools were "terrific." But the nondiscrimination portion of the ruling "really jumped off a cliff," she argued.
On X, meanwhile, Becket attorney Eric Rassbach said after the appeals ruling that the Supreme Court will consider a similar case in October related to nondiscrimination rules and public funding of religious schools.
Governments "cannot evade [Supreme Court precedent] by relabeling discrimination against religion as 'nondiscrimination,'" he wrote. "The Constitution demands more."
