To start a religiously exempt college or university usually requires two equally important elements. First, the school must be owned by a religious organization of some kind, and second, it should be incorporated as a 501(c)(3) non-profit organization. Each state is authorized to oversee the schools that advertise that they are offering degrees or programs that lead toward degrees, within their state. Each state has its own regulations.

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Can Churches Issue Degrees?‍

States, which authorize over 98 percent of all US colleges to issue degrees, use two principal methods to authorize the issuance of degrees: charters and licenses. Charters are generally issued directly by a legislature while licenses, which take many forms and sometimes are simply a letter of authorization, are generally issued by a state agency empowered to do so. Religious colleges have obtained degree authorization through both methods.

Most legal authorities agree that the issuance of degrees is a secular activity that is controlled by governments. There are a number of cases that deal specifically with this issue. In one case, a religious college argued that because its beliefs precluded it from applying for state licensure as a degree-granting institution, it should be allowed to issue degrees because doing so was a protected function under the First Amendment. The New Jersey appellate court disagreed, concluding that:

“ ... the State’s program for licensing institutions of higher education is applicable to sectarian institutions and that facially it does not unduly interfere with the free exercise of religion nor create an excessive state entanglement with religion.”

The Tennessee Supreme Court reached a similar result. The court concluded that the issuance of degrees, even in religious subjects, was a matter for state control, because although the school’s educational function was protected under a free exercise theory, the government has sole authority over all degree-granting.

In a similar case from Ohio involving a school that issued only religious degrees, the result was the same: degrees could not be issued without state authorization. In that case, the trial judge found that the school could continue “teaching or offering to teach courses of instruction the content of which is wholly of a religious nature; provided, however, that no degrees or diplomas are issued, awarded or granted.” The Ohio appellate court found that:

“While it is recognized that there is great merit, and a continuing need, for the teaching of theology and related religious subjects, it is also recognized that there is a great public need and necessity to establish a method of appropriate governmental review of those institutions offering professional degrees or diplomas as evidencing advancement by individuals engaged in the study of such subjects.”

The Attorneys General of Arkansas, Texas, Kentucky, and Nevada have expressed similar views as to degrees; ‘diploma’ is generally considered a more generic unprotected term. These cases and their progeny are considered the leading cases.

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The 'Religious Exempt' Concept in Theory and Practice

One of the blurriest pieces of the US degree-granting puzzle is the status of entities known as ‘religious exempt’ colleges that exist in 22 states. There are many so-called ‘religious exempt’ colleges around the US, but in every case, the exemption is expressly established or formally allowed by the state legislature. This is therefore a hybrid system under which the state in effect delegates its degree authorization powers to churches that want to issue degrees. In many, but not all, cases the degrees issued by these colleges must have a religious title and are designed for use in ecclesiastical settings. The analysis of their status and effect may differ if they issue non-religious degrees.

Religious exemption for degree-granting colleges is a controversial practice in postsecondary education. Twenty-nine states do not allow it at all, and in those states where it is established in law, it is all but universally done contrary to the wishes of higher education professionals. As Stewart and Spille pointed out in their excellent overview of the problems with religious exemptions:

“There are at least three big losers in this situation. The nation’s authentic religious community is the most obvious of these: its good name is being taken in vain. Accredited higher education institutions, particularly those with ties to well-established religious bodies, are another victim: the integrity of degrees is being compromised. A third loser is the general public, as its members are exploited and “served” by persons – especially “counselors” – who hold meaningless degrees.“

Twenty-one states and Puerto Rico allow religious exemptions in some form. The colleges operating under these laws are operating legally under the laws of their states, therefore the degrees are probably technically valid, at least in situations where the degree-granters are named. In most cases, no one knows or can find out whether the academic programs issuing the degrees are any good or even exist at all. In eleven states that don’t require any review at all of religious exempt applications, the providers may be simply mail-order degree mills – no one knows. In this situation, accreditation serves as a useful qualitative screen, as so few exempt schools are accredited.

In many states, religious exempt degrees can only be issued with degree titles that are clearly religious in nature. This idea has usually been uncontroversial, though it has provided an undercurrent of argument in some cases.

The 30 States below have no significant exemption for approval of unaccredited religious degree-granting institutions and programs. Some may have minor exemptions for certain aspects of programs. In these States, degree programs undergo an evaluation and approval process identical or nearly identical to the process used for secular colleges

Alabama, Alaska, Arkansas, Colorado, Connecticut, Delaware, District of Columbia, Kansas, Kentucky, Idaho, Illinois, Maine, Massachusetts, Michigan, Mississippi, Nebraska, Nevada, New Hampshire, New Jersey, New York, North Dakota, Ohio, Oklahoma, Pennsylvania, Rhode Island, Tennessee, Texas, Vermont, West Virginia, Wyoming.

The 21 States below exempt unaccredited religious degree-granting schools from government oversight. Most of these allow restricted-use degrees for religious purposes only.

Arizona, Iowa, New Mexico, Utah, California, Louisiana, North Carolina, Virginia, Florida, Maryland, Oregon, Washington, Georgia, Minnesota, Puerto Rico, Wisconsin, Hawaii, Missouri, South Dakota, Indiana, Montana, South Carolina.

Here is the application for verification of Exempt Status in the State of California as an example: Download