Fact check: Religious organizations received COVID-related loans but US Postal Service did too

Ella Lee, USA TODAY
·8 min read
Fact check: Religious organizations received COVID-related loans but US Postal Service did too

The claim: Churches received $7.7 billion in recovery money and USPS received none

As the United States Postal Service maintains its place in the political spotlight, some supporters on social media are claiming it was treated unfairly in the disbursement of emergency COVID-19 loans – or an alleged lack thereof.

“Are you OK with churches receiving 7.7 billion dollars of recovery money and zero for the USPS?” a viral Aug. 15 Facebook post reads.

A few days later, liberal Facebook page “The Other 98%” shared the same post, amplifying it to its audience of more than 6 million Facebook fans and followers. The page’s post was shared 28,000 times.

Commenters on both posts decried the claim as a slap in the face to a long-held U.S. legal principle, the separation of church and state.

“I believe in separation of church and state!” one commenter wrote. “Still can’t find church included in the Constitution but found the Postal Service.”

“Why would tax-exempt churches receive tax money?!?” another wrote.

In response to USA TODAY’s request for comment, “The Other 98%” spokesperson Mark Provost said he thought “the US public should have a clear and easy understanding of the total COVID relief provided to any and all religious groups.”

The original poster did not respond to USA TODAY’s request for comment and clarification.

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USPS was allocated a COVID-19 relief loan in first stimulus package

The U.S. Postal Service became eligible for a $10 billion loan from the U.S. Treasury via the CARES Act, which was passed in March. A number of stipulations put in place by Treasury Secretary Steve Mnuchin caused that money to be withheld from USPS until the end of July, when it and the Treasury reached an agreement in principle to make that aid accessible.

On Aug. 22, the House passed legislation to provide an additional $25 billion in funding to USPS ahead of the November election. It’s unclear whether that bill will become law, as Senate Majority Leader Mitch McConnell, R-Ky., told the Louisville Courier Journal that he was doubtful it could pass the Senate.

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How much money did religious organizations receive as COVID-19 relief?

Religious organizations received aid from the government through the Paycheck Protection Program.

“The PPP and EIDL loan programs are neutral, generally applicable loan programs that provide support for nonprofit organizations without regard to whether they are religious or secular,” states a press release from the U.S. Small Business Administration. (EIDL refers to the Small Business Administration's Economic Injury Disaster Loans.) “The CARES Act has provided those program funds as part of the efforts to respond to the economic dislocation threatened by the COVID-19 public health emergency.”

As of June 30, the SBA had released 88,411 loans to religious organizations, amounting to $7.3 billion, according to that date’s PPP report. That number is the only publicly available data at this time, SBA spokesperson Jim Billimoria told USA TODAY.

Billimoria added that “religious entities” – not just “churches,” per the claim – were eligible to apply for PPP loans. Applicants received those loans based on the PPP formula of 2.5 times monthly payroll.

Religion-adjacent organizations, like private religious schools, were not included in that figure, according to Nick Fish, president of American Atheists, which advocates for the separation of church and state. Religious organizations are classified separately from private elementary and secondary schools, USA TODAY confirmed.

American Atheists’ analysis estimated that between $3.6 billion and $8.7 billion were given to private elementary and secondary schools in loans over $150,000, and in smaller loans, another $419 million. The SBA released that data. Loans under $150,000 are separated by state, and loans over $150,000 are all listed together.

The U.S. Department of Education estimated in its 2013-2014 Private School Universe Survey that almost 70% of private schools in the U.S. are affiliated with a religion.

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Do the loans impact the separation of church and state?

Many commenters on the original posts feared that the government allocating taxpayer dollars to religious organizations, which are tax-exempt, is a slippery slope that could lead to allowing religion to impact government.

The law most commonly cited in reference to the separation of church and state is the First Amendment’s Establishment Clause, which says Congress “shall make no law respecting an establishment of religion.” Thomas Jefferson once wrote that the Establishment Clause was intended to build “a wall of separation” between the two.

In the Supreme Court case Lemon v. Kurtzman, a three-part test – dubbed the “Lemon” test – was established to determine whether the government can assist religion. It can if the primary purpose of the assistance is secular, the assistance doesn’t promote or inhibit religion and there’s no excessive entanglement between church and state, according to the United States Courts’ website.

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On the other hand, the Free Exercise Clause of the First Amendment, which says Congress can make no law “prohibiting the free exercise” of religion, makes this particular situation foggier.

“The general rule is they can't favor religious entities; that'd be a violation of the Establishment Clause,” said Frank Ravitch, the Walter H. Stowers chair of law and religion at Michigan State University. “But you can't exclude religious entities in a way that would be viewed as discriminatory; that would violate the Free Exercise Clause.”

Ravitch said that in this situation, the government is not favoring religious entities because they’re included with other nonprofit businesses.

A recent Supreme Court ruling also shed light on providing public aid to religious private schools.

The court ruled in June that states offering scholarships to students in private schools cannot exclude religious schools from such programs, USA TODAY reported. States are not required to fund religious education, but they can't differentiate between religious and non-religious private schools.

"A state need not subsidize private education. But once a state decides to do so, it cannot disqualify some private schools solely because they are religious," Chief Justice John Roberts wrote on behalf of the court's majority in the case.

In the case of this recent Supreme Court ruling, the funding is legal so long as religious entities aren't favored over non-religious ones, Ravitch added.

"The Espinoza case reinforces the law that was already on place," he said. But Ravitch also said that favoritism toward religious organizations could violate the Establishment Clause. If a government program, he explained, "does show such favoritism in access to the program, or information about it, procedures, or amounts of funding it is likely unconstitutional. Otherwise, it is not."

The way the courts are interpreting the Establishment Clause has been evolving for years, trending in the direction of permitting government involvement with religion.

“In 2010, I don't think there's much question – it would have been brazenly unconstitutional,” Ravitch said. “… But, you know, before a line of cases that started around 2014, 2015, the understanding was government certainly can't give religious entities lump-sum aid even if it might give nonreligious entities that aid. And it certainly can’t pay the salaries of ministers, things like that. I am not so sure that today that’s true.”

Our rating: Partly false

We rate the claim that religious organizations received $7.7 billion in COVID-19 recovery money from the government when United States Postal Service received none as PARTLY FALSE, because some of it was not supported by our research. The USPS became eligible for a $10 billion loan under the CARES Act and received access to it this summer. Religious entities – not churches – received $7.3 billion in loans as of June 30, according to the figure made publicly available by the Small Business Administration.

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This article originally appeared on USA TODAY: Fact check: USPS and religious organizations received COVID-19 loans