Saving Iowaska’s Tax Exemption By Civil Disobedience
This Week, the Commissioner filed his response to Iowaska’s Petition for Rehearing, en banc. The Petition and the Response are linked below. I swear, what should have been a simple case might take another year or two to resolve. And even then, there is a good chance the Iowaska Church of Healing will still lose. At this point, the only way to salvage the case is through dramatic but simple civil disobedience.
But first, here’s a recap. The Iowaska Church of Healing applied for tax exemption almost 6 years ago. It did not have to apply because it is an organized worship group, aka a “church.” But it wanted some sort of tax law confirmation that it’s sacramental use of Ayahuasca is entirely legal. It is, by the way. There’s a Supreme Court opinion saying so, though the Court allows the government to require a DEA permit first. So shortly after submitting its 1023, Iowaska also applied for the DEA permit. Also 6 years ago. A permit DEA is unquestionably required to issue, as Iowaska is on all fours with Gonzales v. O Centro Espirita Beneficente Uniao do Vegetal, the Supreme Court opinion recognizing a First Amendment right to use Ayahuasca. After 6 years, DEA hasn’t said a word. Meanwhile, the Service denied Iowaska’s application for tax exemption. Until Iowaska obtained a permit, the Service said, its use of ‘Huasca is illegal and tax exemption for the use is prohibited. Go get your permit. It’s the proverbial run-around.
Iowaska sued. Not DEA but the IRS. Not the DEA and the IRS, just the IRS. It lost in the District Court and also before a D.C. Circuit panel. Undaunted, it petitioned for rehearing en banc. The Commissioner filed his response earlier this week. Through arguments about standing, the Religious Freedom Restoration Act, and a cheap kinda “you waived your best shot” argument, the Commissioner makes the basic point that Iowaska is suing the wrong agency. Iowaska has a good counter to that, but it’s hopelessly obscured. Somewhere hidden in the pleadings, and belatedly as the Commissioner points out, Iowaska asserts that RFRA requires every agency to apply RFRA independently of any other agency. So even if DEA is sitting on its hands, the IRS is required to apply RFRA as interpreted by Gonzalez.
The Service should have made a particularized determination that Iowaska’s use of ‘Huasca for religious purposes is Constitutionally protected, and thus not illegal for tax exemption purposes. There is good authority for that, but the panel said Iowaska didn’t brief the argument, mentioning it only in a footnote. The Commissioner is zeroing in on the panel’s waiver finding and will likely win because Iowaska is not making any argument at all that a Constitutional right can’t be accidentally waived, choosing instead to rely on a hapless Loper Bright argument. Not against the Service but against the panel’s affirmation of the Service’s denial of tax exemption. The strange argument is that the panel’s deference to the Service means the panel applied a discredited Chevron analysis. Yeah, good luck with that.
I’ve harped on the point that Iowaska should have sued DEA long ago. A reader points out that suits against DEA on this point are rarely successful. Even though the DEA has never once issued a permit. In most cases doesn’t respond at all. It sits on the application until the applicant gives up and goes away. I don’t understand why a court has not at least required DEA to make a decision, but if this case is not ripe for mandamus, no case ever will be. DEA will have effectively overruled the Supreme Court. The permit application is more than 6 years old now. But let’s assume, for the sake of argument, that DEA is judgment proof.
Civil Disobedience necessary to force an adjudication is the only option left. Here is what Iowaska should do:
1. Through Counsel, inform the local prosecutor, and the U.S. Attorney that the Church Leader intends to use ‘Huasca at a worship service on a date certain. Make sure the Leader is squeaky clean and has no skeletons in his closet that would prevent his release on his own recognizance pending trial. If possible, get the State and US Attorney to agree beforehand that pre-trial confinement would be unwarranted when the Leader is arrested as planned.
2. Invite the local constable to the worship service to execute a prearranged arrest. At the appointed time, with cameras running and in the presence of counsel (who should have previously issued a written opinion to Iowaska regarding the use of ‘Huasca in worship), the Leader should perform the ‘Huasca sacrament. The Leader should not share the ‘Huasca but should use it in his own personal in-service sacramental worship. The Congregation should be present so that there is no question that a religious service is taking place, but mass arrests aren’t necessary.
3. When criminal charges are lodged, file a previously prepared Motion to Dismiss based on Gonzalez, the First Amendment, and RFRA. Request an expedited docket. Make sure the proposed order is written broadly enough to vindicate the Constitutional legality of Iowaska’s use of ‘Huasca for religious worship.
It would be nice if the State and US Attorney cooperate. If they don’t, the Leader is gonna have to be a leader. He should do it anyway. Once there is a judicial finding that Iowaska’s ‘Huasca use is Constitutionally protected, the illegality doctrine goes away. Iowaska wouldn’t even need to file another 1023. It’s low risk and ought to be done. It requires a well-advised Leader with conviction and spiritual fortitude.
darryll k. jones