Fulton v. Philadelphia: The Future of Church-State Cooperation in the Social Welfare Arena

The U.S. Supreme Court recently heard arguments in a case that could determine the future of cooperation between religious child welfare agencies and the state. Fulton v. City of Philadelphia involves several experienced foster parents and Catholic Social Services (CSS) of Philadelphia suing the city for excluding CSS from future participation in the city’s foster care program on the grounds that CSS will not certify same-sex couples as eligible foster parents. The Court’s decision next year might establish a general framework for religious social welfare providers’ demands for free exercise exemptions in connection with state contracts. 

Fulton is factually and legally complex. Here, I will set out the leading points of contention and possible outcome, after sharing some of the history of CSS’ cooperation with the city in service to the needs of children requiring foster parents. 

Catholics in Philadelphia have been assisting children in need since 1797. They understood themselves to be responding to a scriptural imperative to care for “orphans and widows.” During the 20th century, the government increased its involvement in and oversight of children in need of care. For over 50 years, the City of Philadelphia has entered into contracts with CSS and other private foster care agencies. There is a division of labor between the government and the private agency. The city takes custody of children who are in need of care and is required by law to place them in the most family-like setting (see 11 Pa. Stat. § 2633). CSS and other agencies find, train, oversee, and support foster parents. Then, as described in CSS’ brief to the Court: 

When [Philadelphia’s Department of Human Services] DHS needs a foster home for a child, it sends out a request, called a referral, to private agencies. These agencies check to see which foster families are available, then notify DHS of any potential match. Agencies provide information about the foster family, and DHS compares that with information about the foster child. DHS then determines which private agency has the most suitable foster family, based upon factors including race, age, family relationships, and disability . . .  After DHS makes that match, the child is placed with the foster family. The private agency will continue to oversee and support that family to ensure a successful foster placement.

Controversy erupted in March 2018 over a news report that CSS’ religious principles did not permit it to offer certification services to same-sex couples. Interestingly, no same-sex couple had ever approached CSS, but a newspaper reporter investigating the question prompted CSS staff to discuss its policy. City officials met with CSS to require them to comply with the city’s chosen array of eligible households. Before it was over, they had accused CSS of “discrimination that occurs under the guise of religious freedom” and labeled CSS’s beliefs retrograde. The exchange also took place in the context of a rocky history of relations between Philadelphia’s mayor and the local Catholic church. 

Philadelphia thereafter proposed and abandoned five different legal rationales for its decision to part ways with CSS. Finally, it simply inserted a new nondiscrimination requirement into its foster agency contracts, while retaining the discretionary power to waive this requirement. The city stated, however, that it had “no intention” of granting CSS a religious exemption. 

Since the Supreme Court declared same-sex marriage a federal constitutional right in 2015, many local governments have grappled with the question whether to continue to cooperate with religious child welfare agencies. Eleven states have enacted religious freedom laws preserving religious agencies’ ability to operate. Pennsylvania does not have such a law. In some states, however, religious foster care and adoption agencies have closed because they are unable to meet a state’s demands. Because the government has complete control over the custody of foster children, effectively no service provider can operate without meeting such demands. 

At the recent oral argument before the high court in Fulton, the Justices were invited by opposing parties to take two completely different views of the relationship between a city and approved foster care agencies. Each view has important implications for CSS’ religious liberty claims and for the entire future of church-state cooperation in the social welfare arena. 

Philadelphia argued that CSS is simply a government contractor such that the city is legally empowered to choose to work only with those contractors who will carry out its intentions for any given program. They cited Supreme Court precedent in NASA v. Nelson to argue that a government’s choice of contractors need only be a reasonable means of its managing its internal operations. The city further noted that the city’s Fair Practices Ordinance prohibits various forms of discrimination including on the basis of sexual orientation. The city’s attorney raised the specter of governments at every level forced to defer to myriad agencies’ religious objections. In particular, he suggested that some agencies might object to placements based upon race or religion. Finally, the city argued that it would violate the dignitarian interests of LGBT adults and children to learn that their government cooperated with agencies that would not certify same-sex households. 

A key point that could determine the outcome of the Fulton case: the prospect of governments effectively eradicating religious service providers from the wide array of services that form the American kaleidoscope of social welfare providers.

CSS, on the other hand, argued that the Court should not apply precedents concerning government contractors. Because the city exercises plenary authority over foster children, they argued that its nondiscrimination mandate operates more like a general licensing law that effectively bans many religious child welfare agencies from operating at all. On this rationale, CSS invited the Court to instead consult those free exercise cases holding that a government may not discriminate against religious institutions with laws that are not neutral or generally applicable on their face, unless it can demonstrate a compelling state interest realized by means least restrictive of religion. 

CSS then claimed that the relevant Philadelphia law was neither neutral nor generally applicable. Rather, the city retained the ability to make exceptions when placing foster children—and had previously done so in connection with race and disability. Furthermore, Philadelphia had explicitly announced that it would refuse to use its exemption power in favor of CSS. Moreover, the attorneys for CSS argued that the city could not demonstrate a compelling interest or a least restrictive means in this case, emphasizing that CSS was “exercis[ing] its faith by serving at-risk children in Philadelphia for two centuries” and that the city had no” interest in refusing to allow the agency to step aside and provide referrals elsewhere.” In other words, CSS concluded that no same-sex couple would be denied the opportunity to foster because every other Philadelphia-area foster care agency served such couples, and CSS would readily refer same-sex couples to their services.

CSS further argued that not only was the city’s action lacking a compelling interest, but it was also harming children. Just a few days after Philadelphia ended its relationship with CSS, the city issued an “urgent” plea for 300 new foster homes. CSS had 12 homes waiting, but the city refused to use them. 

Both CSS and an attorney representing the U.S. Department of Justice suggested to the Court that it could handle Philadelphia’s concerns regarding racial discrimination by recognizing the country’s acknowledged compelling interest in eradicating racial discrimination. On the subject of Philadelphia’s apprehension about “dignitarian harms,” Chief Justice Roberts wondered aloud if this argument could also be used to exclude those religions reserving ordination to males from participation in all government programs. And CSS pointed out that the Court’s prior decision in Masterpiece Cakeshop v. Colo. Civil Rights Division suggested that “gay persons could recognize and accept without serious diminishment to their own dignity and worth” a religion’s objection to same-sex marriage. 

The larger implications of this case arise because many social services that religious institutions provide overlap areas in which the state wields significant oversight and financial power. These not only include child welfare but also health care and even education. During the oral argument in Fulton, the government pressed Philadelphia’s attorney on the question, asking whether, if the government assumed full control over homeless shelters or hospitals, it could thereafter bar many religious entities from serving in those arenas.

“I do think the government could take over something like homeless shelters in a—in a given county or a community," the attorney replied. "I don't think there's any way to draw a line between what the government can and can't take over.”

Judging from the Justices’ questions, it appears that this last point might ultimately determine the outcome in Fulton: the prospect of governments effectively eradicating religious service providers from the wide array of public and private agencies, hospitals, shelters, homes, etc. that form the American kaleidoscope of social welfare providers. For example, Justice Kavanaugh inquired whether there could not be a “win-win” resolution whereby religious providers could participate, so long as they were willing to refer prospective foster parents to other agencies. Justice Roberts’ question raising the specter of governments’ disqualifying religions with an all-male clergy and Justice Coney Barrett’s question about what might happen to religious hospitals if the government assumed plenary authority over health care both pointed in the same direction. Catholic hospitals alone provide a great deal of fee care to the indigent, and approximately one of six hospital beds in America.  

All of this suggests the Supreme Court might reach a conclusion declaring that because Philadelphia has assumed full control over foster children, and because same-sex couples could retain the opportunity to foster elsewhere, religious agencies would merit a free exercise exemption to continue to participate. For now, we will have to wait until the Court issues its opinion in this important case in 2021.

Helen Alvare’ is a Professor of Law at George Mason University School of Law and the author of Putting Children’s Interests First in U.S. Family Law and Policy: With Power Comes Responsibility.