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August 20, 2002 Page 3 further analysis may be required into whether an institution participating in a program is religious, in order to determine whether governmental aid will actually be used specifically for religious purposes. However, as Zelman makes totally clear, the religious characteristics of a participant is absolutely irrelevant in indirect aid cases. The Supreme Court has only addressed tax-exempt financing once. In 1973, it followed its existing precedents for direct funding by allowing bonds to be issued for a religiously affiliated college which was not pervasively sectarian. However, the Court specifically noted that this was a special kind of indirect aid more akin to a governmental service. Several specific cases involving tax-exempt bonds have arisen in the courts in recent years, as educational institutions, governmental units and bond lawyers, as well as the courts, sought to function in the new environment. Three significant cases have reached final determination in the last two years. A religiously affiliated Catholic high school in suburban Detroit issued bonds to finance a secular project. The bonds were subsequently challenged. The District Court and the United States Sixth Circuit Court of Appeals both approved the constitutionality of the bonds for Sacred Heart Academy on the grounds that the bonds were neutral in purpose and effect, the school was merely sectarian or religiously affiliated and not pervasively sectarian and the issuance of tax- exempt bonds was an indirect benefit. By contrast, David Lipscomb University in Tennessee was originally held to be a pervasively sectarian institution. Therefore, the Federal District Court denied tax-exempt financing. On August 14, the Sixth Circuit Court of Appeals reversed the District Court, holding that tax-exempt financing was permissible even for a pervasively sectarian institution, because it was indirect aid within the meaning of Zelman. The Sixth Circuit also relied on several Supreme Court cases to the effect that this kind of a tax benefit has always been considered by the courts to be indirect assistance at best. Finally, in late 2000, the Virginia Supreme Court overruled its 1989 decision regarding Liberty University and specifically held that tax-exempt financing for Regent University, also a pervasively sectarian institution, did not violate the religion clauses of the First Amendment. Finally, two other recent cases are worth mentioning. In 2001 the United States Supreme Court ruled that the Milford Middle School, part of a public school system, was required to allow an evangelical youth group known as The Good News Club to meet after school on school premises during extracurricular activities time. This was so because the school could not discriminate on the basis of religion or on the content of the speech of the club once the school had established these kinds of after-school forums. This is merely the most recent example of a long line of Supreme Court cases which prohibit governmental units from making distinctions based upon religion or religious speech in order to keep a religiously affiliated institution from participating in an activity or program to which all others had access. Similarly, this past July, the Ninth Circuit Court of Appeals specifically required that the State of Washington extend a particular scholarship program to include students studying in pervasively sectarian colleges and pursuing careers in the parish ministry. In Davey v. Locke, the Ninth Circuit specifically struck down arguments that the Washington constitution required a