A Divided Supreme Court Ruling Prohibits Oklahoma from Using Government Funds to Establish a Religious Public Charter School

07.02.2025

On May 22, 2025, the U.S. Supreme Court affirmed the Oklahoma Supreme Court’s decision preventing Oklahoma from using government funds to sponsor a religious charter school. (Okla. Statewide Charter Sch. Bd., et. al. v. Drummond, 605 U.S. ---- (2025)).  The U.S. Supreme Court was split 4-4 in issuing its decision, with Justice Barrett recusing herself from the case and taking no part in the oral arguments or the decision itself. Therefore, it does not constitute nationwide binding precedent, and, thus, lower courts addressing this issue will not have guidance from the U.S. Supreme Court. Moving forward, religious charter schools are likely to face legal challenges.

The Court did not provide an opinion explaining its decision, and the decision was issued per curiam, without revealing how each Justice voted. That said, some of the reasoning behind the decision may be drawn from the Oklahoma Supreme Court’s ruling and the oral arguments before the U.S. Supreme Court.  The Oklahoma Statewide Charter School Board v. Drummond case was determined under a specific Oklahoma state law regulating charter schools, the Oklahoma State Constitution, and the Establishment Clause of the First Amendment to the U.S. Constitution, and sheds light on similar questions regarding religious charter schools under California law.

Oklahoma Statewide Charter School Board v. Drummond

The Oklahoma Charter Schools Act (“Act”), which governs the creation and operation of charter schools in the state, establishes that charter schools are public, nonsectarian schools sponsored by a school district, other state educational institution, or the Statewide Charter School Board. The Act was enacted to help carry out the state’s duty pursuant to the Oklahoma Constitution to establish a system of free public schools “free from sectarian control….”  In February of 2023, the Archdiocese of Oklahoma City and the Diocese of Tulsa applied to Oklahoma’s Charter School Board to establish St. Isidore, a virtual Catholic charter school with a stated purpose of “fully incorporat[ing]” Catholic teachings into “every aspect of the school.” On June 5, 2023, the Charter School Board voted to approve St. Isidore’s application and became St. Isidore’s government sponsor.

Shortly after the school’s approval, Oklahoma’s Attorney General, Gentner Drummond, released a statement expressing concerns with the Board’s decision.[1] Drummond stated that the Board’s decision was unconstitutional. He also stated that the approval of St. Isidore violated Oklahoma law and went against the best interest of taxpayers. Despite Drummond’s opposition to the approval of the school, the Board and St. Isidore proceeded to execute a contract for the school’s operation, which established that St. Isidore would integrate Catholic teachings in its curriculum, admissions policies, and activities.

St. Isidore was set to open in the Fall of 2024. However, in October 2023, the State of Oklahoma sought a writ of mandamus directing the Charter School Board to rescind the contract on the grounds that it violated both state law and the U.S. Constitution. On June 25, 2024, the Oklahoma Supreme Court found in favor of the state, reasoning that the St. Isidore contract violated the state constitution, the Act, and the Establishment Clause of the First Amendment to the U.S. Constitution (Drummond ex rel. State v. Oklahoma Statewide Virtual Charter School Board, 558 P.3d 1 (Okla. 2024).

First, the Oklahoma Supreme Court determined that the contract violated the Oklahoma Constitution, which prohibits the state from using public money for the benefit or support of any religious institution (Okla. Const. art. 2, § 5; Okla. Const. art. 1, § 5). The court explained that the Charter School Board’s expenditure of public funds for St. Isidore’s operations “constitutes the use of state funds for the benefit and support of the Catholic church.  It also constitutes the use of state funds for the ‘use, benefit, or support of … a sectarian institution’” in violation of the Oklahoma Constitution’s prohibitions.

The court further found that the contract violated the Act’s requirement that all charter schools be nonsectarian in their programs, admission policies, and other operations.  St. Isidore is unquestionably a sectarian institution that would be sectarian in its programs and operations, and the contract was necessarily altered from Oklahoma’s model contract to allow it to operate as a religious charter school.  The court found this violated the plain language of the Oklahoma Constitution and the Act.

The court also rejected the defendants’ argument that the nonsectarian requirement did not apply because St. Isidore was a private actor contracting with the state to perform a benefit for the state rather than a public school. The court explained that under the Act, charter schools are public schools sponsored by a governmental entity, and St. Isidore would “be acting as a surrogate of the state in providing free public education as any other state-sponsored charter school ….” The court determined that St. Isidore was a state actor both because it is “entwined” with government policies and the management and control of the government and because it is performing a “public function” as the provision of a free public education, including through charter schools under the Act, is exclusively a public function. As such, St. Isidore “is a governmental entity and state actor.” Accordingly, the court found that, St. Isidore, as a public charter school established under the Act, is required to comply with “the Oklahoma Constitutional provision requiring that Oklahoma’s. . . public schools be free from Sectarian control.” (Drummond ex. rel., 558 P.3d at 9).[2]

The court also found that the establishment of a religious public charter school violated the Establishment Clause. [3] Under the Establishment Clause, states cannot pass laws that aid any religion, which includes spending government money to directly support religious institutions or activities (See Everson v. Bd. of Educ. of Ewing Twp., 330 U.S. 1, 15, 67 S.Ct. 504, 91 L.Ed. 711 (1947)). The court pointed out that “an Establishment Clause case hinges on whether religious activity involves a ‘state actor’ or constitutes ‘state action.’”  Noting that the U.S. Supreme Court had not addressed the creation of a religious public school under the Establishment Clause, the court pointed to a line of precedent establishing that public schools, as state actors, cannot require students to participate in religious activities. As a public charter school (a “state actor”), St. Isidore sought to incorporate religious teachings into the curriculum and require students to participate in religious activities. Furthermore, the St. Isidore contract would require Oklahoma to directly support a religious institution by funding the school. Thus, the court concluded that the contract violated the Establishment Clause and directed the Oklahoma Charter School Board to rescind its contract with St. Isidore.

Finally, the court rejected the defendants’ contention that the Free Exercise Clause of the First Amendment to the U.S. Constitution prohibited “a state from denying St. Isidore its right to operate as a charter school solely because it is religious.”  The court distinguished this case from recent U.S. Supreme Court decisions holding that, pursuant to the Free Exercise Clause, “once a state makes a public benefit available to its citizens, the state cannot exclude a religious entity’s eligibility solely because of its religious affiliation.”  The court found that St. Isidore’s request to operate and receive funding as a religious charter school was distinct from the “fair treatment of a private religious institution in receiving a generally available benefit” implicating Free Exercise Clause issues in recent U.S. Supreme Court cases. The court further determined that even if St. Isidore could establish free exercise rights, those rights would not overcome the prohibitions of the Establishment Clause.

Potential Impacts and Other Recent Developments Affecting California Charter Schools

Although non-precedential, the U.S. Supreme Court’s decision affirming the Oklahoma Supreme Court’s decision appears in line with California’s prohibition on sectarian charter schools. Much like Oklahoma’s Act, the California Charter Schools Act provides that a charter school is required to be “nonsectarian in its programs, admission policies, employment practices, and all other operations ….” (Ed. Code §§  47605 & 47605.6.)  California charter schools are also explicitly part of the “Public School System” required to be established pursuant to the California Constitution and are under the jurisdiction of the Public School System and “the exclusive control of the officers of the public schools ….” (Ed. Code § 47615(a)(1) & (2), Cal. Const. Art. IX, section 8.)

Although the impact on religious charter schools is not entirely clear, there have been recent developments challenging other nonsectarian requirements impacting education in California. In Loffman v. California Department of Education (2024) 119 F.4th 1147, three Orthodox Jewish families challenged the nonsectarian requirement in California’s Education Code requiring that students with an Individualized Education Plan (IEP) under the Individuals with Disabilities Education Act (IDEA) be placed in nonpublic, nonsectarian schools, commonly referred to as “NPSs,” that meet specific statutory requirements. (Ed. Code § 56365 (a).) The Ninth Circuit reasoned that the nonsectarian requirement was not a neutral or generally applicable policy, because it singled out religious entities for different treatment, consistent with the recent U.S. Supreme Court cases applying the Free Exercise Clause that the Oklahoma Supreme Court found were inapplicable to St. Isidore in Drummond, as discussed above. As a result, the Ninth Circuit reversed and remanded the case to the District Court to determine whether the nonsectarian requirement passed constitutional muster under the Free Exercise Clause. The California Department of Education and Los Angeles Unified School District recently settled the case agreeing to permanent injunctions stating that they will no longer enforce the nonsectarian requirement.[4]

The key distinction between the two cases seems to be that in Drummond, the issue was whether State funds could be used to create a new religious public charter school, which was determined itself to be a government entity and state actor, whereas in Loffman, the issue was whether the Plaintiffs could be denied special education benefits they would otherwise have been entitled to because the private NPSs in which they chose to place their students were sectarian. Given the U.S. Supreme Court’s split on Drummond, it is unclear how the distinction between the two cases may be applied in the future.

Religious charter schools seeking approval under California State law are likely to face legal challenges similar to those in Drummond under the California Constitution, the Education Code, and the Establishment Clause.

For further information on the content of this Alert, please contact your AALRR attorney or the authors.

Thank you to law clerks Anastacia Son and Camille Schaefer for their assistance in preparing this Alert.

[1] The Press Release can be accessed here: Drummond says religious charter school approval is unconstitutional.

[2] In determining that St. Isidore was a state actor, the court noted that other federal courts, including the Ninth Circuit, which has jurisdiction over California, “have treated charter schools as governmental entities or state actors.”  (Drummond ex. rel., 558 P.3d at 13, fn. 11)

[3] The Establishment Clause states, “Congress shall make no law respecting an establishment of religion. . .”

[4] Read more about the Loffman decision and its impact here: https://www.aalrr.com/newsroom-alerts-4133

This AALRR publication is intended for informational purposes only and should not be relied upon in reaching a conclusion in a particular area of law. Applicability of the legal principles discussed may differ substantially in individual situations. Receipt of this or any other AALRR publication does not create an attorney-client relationship. The Firm is not responsible for inadvertent errors that may occur in the publishing process.

© 2025 Atkinson, Andelson, Loya, Ruud & Romo