Am. Civil Liberties Union of N.J. v. Hendricks, 183 A.3d 931

Background

New Jersey enacted the "Building Our Future Bond Act" to fund higher-education capital projects; grants were awarded to 176 projects including two religiously affiliated institutions: Beth Medrash Govoha (Yeshiva) and Princeton Theological Seminary (Seminary).
The Yeshiva is an advanced Talmudic institution (men only), with programs focused almost exclusively on Talmudic scholarship; it received roughly $10.6 million for library and academic center construction.
The Seminary is an accredited theological graduate school (Christian), awarded about $645,323 for IT/library upgrades and a training room; it acknowledged degree programs, faculty, and students tied to the Christian faith.
Plaintiffs (ACLU-NJ) sued the Secretary of Higher Education and State Treasurer, alleging the grants violate the New Jersey Constitution's Religious Aid Clause (Art. I, ¶ 3), the Establishment Clause, the Donation Clause, and the Law Against Discrimination (re: Yeshiva’s male-only admissions).
The Appellate Division invalidated the grants under the Religious Aid Clause, relying on Resnick; the State sought review. The Supreme Court held the administrative record was insufficient and remanded to the Secretary for an evidentiary contested-case proceeding before resolving constitutional claims.

Issues

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether grants to sectarian higher-education institutions violate NJ Art. I, ¶ 3 (no public funds for "maintenance of any minister or ministry").	Grants will directly subsidize religious instruction/ministry because both institutions are pervasively sectarian and the projects will enhance religious training.	Proper analysis focuses on the use of funds (secular infrastructure); grants are for secular facility/IT improvements and public access, not maintenance of ministry.	Record inadequate to decide; remand to Secretary for fact-finding on sectarian nature, intended use, and safeguards.
Whether Resnick controls and mandates invalidation of these grants.	Plaintiffs rely on Resnick to show public subsidization of religious instruction is barred.	State argues Resnick is fact-specific and not controlling here because it involved rental/use of public facilities; different context.	Court: Resnick is not dispositive here on present record; factual development required before applying or distinguishing Resnick.
Whether denying grants could violate the federal Free Exercise Clause.	(Not raised by plaintiffs) Plaintiffs focused on state constitutional limits.	State and institutions warn that denial might implicate Free Exercise (contrast Locke and Trinity Lutheran).	Court declines to resolve Free Exercise issue now because factual record is insufficient; remand required.
Adequacy of proposed restrictions limiting sectarian use of grant-funded facilities.	Plaintiffs contend promised restrictions are insufficient to prevent impermissible religious use.	Institutions assert commitments (e.g., no chapels, public access, no ordination use) and technological/library access will be secular and inter-institutional.	Court: Adequacy of restrictions is a factual question to be developed in an administrative hearing.

Key Cases Cited

Resnick v. East Brunswick Township Board of Education, 77 N.J. 88 (invalidating subsidized religious use of public school facilities unless full costs are reimbursed)
Freedom From Religion Foundation v. Morris County Board of Chosen Freeholders, 232 N.J. 543 (NJ Supreme Court analysis of Religious Aid Clause and Trinity/Locke interplay)
Locke v. Davey, 540 U.S. 712 (upholding state's exclusion of funding for devotional theology degrees under Free Exercise analysis)
Trinity Lutheran Church of Columbia, Inc. v. Comer, 137 S. Ct. 2012 (addressing discrimination against religious entities in a public benefit program; distinction between religious identity and religious use)
Everson v. Board of Education, 330 U.S. 1 (permitting certain public benefits related to religion, e.g., reimbursement for busing)