The Government is giving Iowaska Church of Healing the Runaround
We have previously reported about the efforts of Iowaska Church of Healing to gain tax exempt status despite its use of a schedule I controlled substance in its worship. Iowaska uses Ayahuasca in its worship activities, and the Supreme Court has ruled that banning such use improperly burdens the free exercise of religion and violates the Religious Freedom Restoration Act. The Government acknowledges Supreme Court precedent but asserts the right to impose a licensing process by which worship groups may apply for an exception to laws prohibiting use of “huasca” in worship. Sounds reasonable enough.
Except the Government is dragging its feet in approving Iowaska’s two year old [at least] application. I still don’t know why Iowaska is not suing DEA for mandamus or something. When I asked, counsel told me that there were various reasons for not suing DEA but because I was being snarky he wasn’t gonna tell me what those reasons were. I was a bit snarky, admittedly. The answer is probably somewhere in the Administrative Procedure Act, I bet. Meanwhile, the Service keeps telling Iowaska to just get the doggone DEA permit and the Service will issue a determination letter. Jeez, what do you expect us to do! Sounds like the proverbial runaround to me.
By the way, our colleague Lloyd has written a thing or two about group worship and tax exemption. Iowaska cites and briefly references his 2021 article in its opening brief on appeal to the DC Circuit Court of Appeal. I criticized Iowaska for not suing both agencies from the start. One thing I might approve, though, is that Iowaska has now promised not to use huasca in its worship until DEA acts. Problem solved, then, right? Because if it is a church — i.e., a worship group — and it has tabled the use of huasca for now, it is automatically exempt and does not need IRS approval. Churches and other worship groups don’t have to apply. So if it really wants to perpetuate the runaround, the Government ought to file a suggestion of mootness, or maybe a motion to stay pending DEA action. Iowaska is gonna have to sue DEA sooner or later anyway, but what do I know? Here is Iowaska’s summary of argument:
SUMMARY OF ARGUMENT
It is undisputed – or at least, must be assumed in ICH’s favor on appeal from the district court’s grant of summary judgment to the IRS – that:
(1) ICH is entitled to tax-exempt status under 26 U.S.C. § 501(c)(3) as a religious and charitable organization unless it is disqualified as organized or operated in substantial part for illegal purposes because of its ayahuasca sacrament;
(2) ICH’s ayahuasca sacrament is a sincere exercise of religion, see D.E. 22-1, at 2-5, which is protected by RFRA, which the Government can prohibit or otherwise substantially burden only if its actions withstand strict scrutiny. See 42 U.S.C. § 2000bb-1(a)-(b); O Centro, 546 U.S. 418 (holding that the Government failed to justify under RFRA’s strict scrutiny standard treating as criminal sacramental use of ayahuasca strikingly similar to ICH’s ayahuasca sacrament); and
(3) under its articles of incorporation, ICH is organized to operate within the law, see D.E. 29-2, at 9, and since August 2019, ICH has suspended its ayahuasca sacrament pending confirmation of its legality, see D.E. 22-1, at 7-8.
Yet the IRS and, on de novo review, the district court held ICH’s currently suspended ayahuasca sacrament disqualifying under the Tax Code, and the district court held that ICH lacks constitutional standing to bring its RFRA claim. The district court erred both in rejecting ICH’s Tax Code claim on the merits and in rejecting ICH’s RFRA claim for lack of standing.
Iowaska has not garnered as much official support from established worship groups as one might expect. But two nonprofits, the Chacruna Institute for Psychedelic Plant Medicines, and the Sacred Plant Alliance, filed a joint amicus brief earlier this week:
Chacruna is a 501(c)(3) non-profit dedicated to providing research and education regarding plant and psychedelic sacraments. Chacruna advocates the continued protection under RFRA of the religious use of psychedelic sacraments, including ayahuasca. SPA is an association of churches fostering mutual support and education, supporting the development of church leaders and of best practices for church operations, and creating accountability for religious sacrament churches. SPA’s mission is to facilitate the collaboration of churches in educating members and the public about their rights and best practices regarding entheogenic sacraments, and SPA is dedicated to ensuring the continued legal protection of the sincere, safe, and ethical religious use of entheogens within the United States.
Amici reasonably point out that DEA is giving new meaning to “foot dragging:”
D. No formal rules have yet been promulgated, contradicting DEA’s prior representations. Over three years ago, in support of its motion to stay the Arizona Yage case, a DEA official declared that a revised Final Rule superseding the 2009 [interim] Guidance was forthcoming:
DEA is currently updating and revising its regulations implementing the CSA for the purpose of describing the procedures by which … DEA will evaluate applications for religious exemptions under RFRA. When implemented, these revised regulations would supersede the 2009 Guidance…. Following DOJ and OMB review … DEA expects to publish a Notice of Proposed Rulemaking (“NPRM”) in the Federal Register to obtain the views of the regulated community and the public at large.… DEA will consider any comments received, make any needed revisions, and then publish a Final Rule…. Arizona Yage Mot. to Stay at 4 (citations omitted) (emphases added).
In Spring 2021, DEA proposed a rule entitled “DEA Registration for Religious Organizations under the Religious Freedom Restoration Act,” which would “amend [DEA] regulations to accommodate religious entities who seek to apply for a DEA registration based on the terms of” RFRA. No Final Rule has yet been promulgated and, years later, nothing about that proposed rule has advanced in the rulemaking process.
As a result, since 2009, the absence of clear rules and regulations has led to unnecessary litigation and substantial burdens on churches’ right to use controlled sacraments, like ayahuasca, in their sincere religious ceremonies. Hence, this case.
Amici have the better argument, finally. In the absence of an accessible administrative process for approval of a right already confirmed by the Supreme Court — it does not appear a final rule is anywhere close — the IRS should be required to determine for itself whether using huasca is part of sincerely held beliefs. Because right now and indefinitely into the future, Iowaska is getting the proverbial and apparently intentional runaround.
darryll k. jones