- Associated Press - Friday, May 13, 2016

HELENA, Mont. (AP) - The Montana Department of Revenue defended its exclusion of religious schools in the state’s School Choice program, saying that it was on sound legal footing in denying tax credits for donations to private scholarship funds later used at faith-based schools.

But on Friday, an attorney for the Institute of Justice, a Virginia law firm advocating for school-choice programs, was preparing to file a motion asking a Flathead district court judge to rule immediately in the favor of three Montana mothers who say their children are being denied access to scholarships because they attend a religious school.

The request comes after state officials filed a response to a temporary injunction issued last month by the district court. In his ruling, Flathead County District Judge David Ortley suggested that the Department of Revenue likely overstepped its authority in excluding religious schools as a “qualified education provider” under Montana’s School Choice program, which offers tax credits of up to $150 for donations.

Ortley said the state Legislature did not explicitly bar such schools from the program when it passed Senate Bill 410 last year. The measure, which became law without Gov. Steve Bullock’s signature, went into effect in January. He said the agency’s rule excluding faith-based schools in the scholarship program is a “complete barrier” for the plaintiff’s children in competing for scholarships.

“Families are counting on these scholarships and they need to know whether the rule will hold them back. This rule has been hanging like a dark cloud over the program for six months,” said Erica Smith, the attorney for the three parents.

The revenue department said it will continue to comply with the temporary injunction.

“We are saying that we still believe that we need to implement the rule because otherwise we will be in violation of the constitution,” said department spokeswoman Molly A. Petersen.

“The department’s actions are unconstitutional, discriminatory, and a waste of time,” said Jeff Laszloffy, president of the Montana Family Foundation.

“School choice is coming to Montana just as it has to 42 other states because every student has a right to their perfect educational fit.”

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