Rick Warren's Clout
How much clout does Rick Warren have?
The California megachurch minister and opponent of gay marriage who will deliver the invocation at Barack Obama's inauguration had his income tax returns audited in 1996. When the IRS tried to collect the taxes it claimed he owed, Warren went to court. Congress then passed a law granting Warren's tax deduction, pre-empting the US Court of Appeals from even taking up the case against him. The votes in the House and Senate were unanimous.
The IRS permits members of the clergy to claim exemptions for their housing. At the time of Warren's audit the amount claimed had to be "reasonable"--it shouldn't exceed the fair market value for the rental of the home. That 1996 audit concluded that Warren was deducting more than that--the IRS said he owed it $55,300. Warren challenged the IRS in tax court, arguing that his housing exemption should be unlimited.
The facts were simple: in 1993 Warren deducted $77,663, his entire Saddleback Church salary that year, as a housing expense--and paid no taxes at all on that salary. In addition, he claimed a deduction for his mortgage expenses--even though they had been covered by the salary. He made similar claims in subsequent tax returns.
Warren spent four years defending his housing deduction in tax court; in May 2000 he won. The court struck down the IRS's "reasonable" clergy-housing cap and accepted Warren's argument that his housing claim could be unlimited. The IRS appealed, and since Warren lives in California, the case went to the US Court of Appeals for the Ninth Circuit, known for its liberal judges. That court declared that it wanted to consider not only whether the IRS had been right in trying to limit Warren's tax deduction for housing but also whether the tax break for clergy housing violated the establishment clause in the Bill of Rights, which requires separation of church and state.
Seeking arguments on the constitutionality of the "parsonage exemption," as it was called, the Ninth Circuit panel appointed Erwin Chemerinsky as a friend of the court. At the time, Chemerinsky was teaching law at the University of Southern California in Los Angeles; today he is dean of the law school at the University of California, Irvine (and thus my colleague). Chemerinsky observed that the housing tax exemption applied only to "ministers of the gospel"--not to leaders of secular nonprofits engaged in humanitarian work. He noted that the rule was established in 1954, at the height of the cold war, after a Congressman argued that "in these times when we are being threatened by a godless and antireligious world movement we should correct this discrimination against certain ministers of the gospel who are carrying on such a courageous fight against this foe." Chemerinsky concluded that the exemption represented an intentional government subsidy of religion, and thus it violated the First Amendment's establishment clause.
But before the three-judge panel could rule, either on the IRS effort to collect back taxes from Warren or on Chemerinsky's broader argument for declaring the entire exemption unconstitutional, Congress stepped in--and acted with "almost miraculous" speed, as Richard Hammar, editor of the Church Law & Tax Report newsletter, explained to the New York Times. The new law granted Warren his deductions (along with any other clergy who had done the same--although Warren was the only one to end up in court). Congress also put into law, from that time forward, the IRS's "fair rental value" rule.
The Clergy Housing Allowance Clarification Act of 2002 was approved unanimously by Congress, then signed into law by George W. Bush on May 20, 2002, rendering the IRS case against Warren moot. "I have filed hundreds of briefs in federal courts," Chemerinsky told me, "and this is the only time that Congress passed a law to make a specific pending case moot." He added, "It is very rare for Congress to pass a law to make a pending case moot before there was a decision."
Warren prevailed in part because of his prominence as the author of a book that has sold more than 25 million copies and as the founder of his 22,000-member church in Orange County. He prevailed also because he saw how his tax deduction could be turned into an example of what his defenders called "judicial activism at its worst." Right-wing talk-radio host Hugh Hewitt called it an example of "the implacable hostility of the political left to the role of God in the world and the country."
Religious denominations from Reform Jews to Southern Baptists expressed their support for the exemption. But their goal was preserving their own exemptions in the future, not defending Warren's past tax returns. The bill could have established the "reasonable" standard the IRS sought for the exemption without letting Warren off the hook. Or Congress could have waited to see what the courts would decide about the constitutionality of the exemption before acting on it.
Instead, Rick Warren posed as a defender of clergy of all faiths against a godless left-wing court. Not even the most progressive members of Congress were willing to stand up to him--not Ted Kennedy, Paul Wellstone, Russ Feingold, Bernie Sanders or Barney Frank. Obama's invitation to Warren is dismaying, but this history may make it more comprehensible.