IRS vs. 'segregation academies'
A federal court has ordered the Internal Revenue Service to withdraw tax-exempt status from so-called "segregation academies" in Mississippi. The recent ruling, which attracted relatively little national attention, could prove a major victory for civil rights groups in their drawn-out campaign against continuing efforts in the South and elsewhere to circumvent public school integration. While this latest court action pertains specifically to racially discriminatory private schools in Mississippi, the issue has implications for some 750,000 children attending 3,500 private schools, including church-related ones, across the South.
In effect, US District Court Judge George L. Hart Jr. has directed the IRS to do a better job of enforcing a 1971 court order that private schools which discriminate against blacks cannot be considered "charitable" institutions under the law and therefore are not eligible for tax-exempt status. Civil rights lawyers have long argued that tax exemptions are essential to the successful operation of the numerous private "seg" academies that sprang up in the South and in some Mid- western states in the wake of efforts in the 1960s to desegregate public schools.
For its part, the IRS does not dispute that its present procedures for determining whether a school discriminates racially are ineffective. Until now, a school has had to do little more than publish a once-a-year notice in a local newspaper announcing that its policy is not to discriminate in order to retain its tax-exempt status. Recent attempts by the IRS to stiffen enforcement ran into heated opposition in Congress. A few congressmen succeeded in attaching riders to an appropriations bill for the IRS prohibiting the agency from spending funds to implement stronger guidelines. Those riders, in fact, will be carried forward another year unless Congress displays the kind of responsibility Americans ought to expect from their elected representatives and acts to rescind them.
Judge Hart has placed the burden of proving that private schools are in fact open to students and teachers of all races squarely on the schools themselves. The court has called for "clear and convincing" evidence that the absence of black students in a school is not the result of racially discriminatory policies. This could involve, for instance, proof of vigorous programs for recruiting minorities and any other efforts made by a school to communicate with minorities in the commuity it serves. And the court leaves no doubt that the IRS is to keep closer watch on tax-exempt schools to ensure compliance.
This latest court order leaves the IRS in the anomalous position of having to enforce one set of standards in Mississippi and another set in the rest of the US. A lawsuit challenging the tax-exempt status of private academies in six other states has been filed by the parents of black children in those states. Rejected by a lower court on jurisdictional grounds, it is currently being appealed. It seems reasonable to expect that eventually the same criteria the courts have imposed in Mississippi will be established on a nationwide basis. But Congress need not wait for the courts to provide the initiative for taking the whole matter under consideration.