Did you know that Title IX regulations usually do not apply to private schools? Title IX normally applies to local and state agencies that receives federal financial assistance. For private schools, or other entities that do not receive any federal funding, Title IX had not traditionally applied but there is new case law in this area.
In the United States, most private schools have a tax-exempt status that allows them to deduct contributions to tax exempt organizations from their total taxable income. This is a critical part of the ongoing financial stability of many private financial institutions. Recently, there have been rulings that may require tax exempt institutions to adhere to certain federal policies, which could drastically change the landscapes of many schools' systems of operations. This article aims to outline what these cases could entail for private institutions and provide groundwork for what changes may occur and how people can evaluate their individual situations amidst potential changes of federal policy.
In the ruling on Conrad v. Baltimore Lutheran High School Association d/b/a Concordia Preparatory School, District Court Judge, Richard D. Bennet held that “the tax-exempt status of the Defendant under 26 U.S.C. § 501(c)(3) constitutes federal financial assistance for the purposes of Title IX.” This ruling comes as a large shift in the way independently operated private institutions and private schools might have to operate going forward.
Institutions that receive federal funds are required by law to abide by Title IX regulations and policies. This requires that schools have published policies regarding harassment, sexual harassment, and sexual assault, and that upon being notified of allegations certain investigation procedures are strictly followed.
In the above-mentioned case, the defendant did submit motions that “contends that it is not subject to Title IX jurisdiction as it was not a direct recipient of federal financial assistance during the relevant time periods.” Judge Bennet held that this argument is without merit due to the institution's 501(c)(3) status.
This case was brought forward after a group of five different women came forward with allegations that they had experienced sexual assault or verbal sexual harassment by male students at their school, Concordia Preparatory School (CPS) previously known as Baltimore Lutheran High School. Upon bringing the abuse to the attention of school officials, they allege that school officials failed to adequately address the issues “cultivating a hyper-sexualized culture at the school.”
Similarly, just a few days after a California case, (E.H. v. Valley Christian Academy), held that due to Valley Christian Academy receiving a PPP loan and a tax-exempt status they were considered financially funded, in terms of Title IX regulations as well.
Female student E.H, who is suing Valley Christian Academy for violating state and federal laws, played in a scrimmage football game in Valley Christian Academy as a wide receiver. Upon taking off her helmet she was publicly humiliated by people shaking their heads and glaring at her in disbelief. E. H’s school, was notified by Valley Christian Academy that E.H. “was not welcome on Defendants Valley Christian’s and First Baptist’s shared premises to compete in a football game there again solely due to the fact that she was female.” In a letter addressed to Cuyama Valley, E. H’s Schol, Valley Christian Academy detailed that they were willing to upend the football season schedule to respect the “guiding principles of the Bible regarding the care of a woman.”
Valley Christian Academy, like CPS, moved to dismiss the claims under Title IX, noting they did not have to follow title IX regulations because they do not receive federal aid. Under the judges’ opinion that a tax-exempt status is enough to constitute federal financial assistance under Title IX, private schools may face changes in their operations.
Under Title IX Davis V. Monroe County BD. OF ED., held that misconduct is found “only where the funding recipient is deliberately indifferent to sexual harassment, of which the recipient has actual knowledge, and that harassment is so severe, pervasive, and objectively offensive that it can be said to deprive the victims of access to the educational opportunities or benefits provided by the school.”
While oppositions and appeals to the rulings are expected to come, these opinions do have the potential to have major impacts on student Title IX claims in private institution. With these ruling private institutions that have received federal loans, could now potentially be subject to certain federal laws.
Currently, the Hahn Legal Group urges students with potential Title IX claims to seek representation to evaluate whether they can proceed with legal action. . Private Schools that receive federal assistance including loans and grants may have to review what sexual harassment policies they do currently have in place to ensure they are in line with actual practices that occur when and comply to current standards.
While the decisions of this court do not have jurisdiction over other areas these rulings could set a precedent in changes to come by other courts when similar cases arise in their area.
These two cases will raise the question as to whether entities that provide federal financial assistance will begin to regulate on the basis of sexual harassment and Title IX. This includes the small business administration (PPP loans), and the IRS. This could potentially require major administrative additions to private institutions and schools if that institution is a nonprofit or could potentially result in an institution losing it’s nonprofit status.
As this case continues, we will continue to update you with what changes are occurring in other parts of the country, and if any decisions would have impact on California private schools. On September 31st, Judge Bennett began to hear oral arguments in the Conrad v. Baltimore Lutheran High School Association d/b/a Concordia Preparatory School case. For further guidance on these issues please call our office at 310.706.3400.
