California Senate Panel Advances Bill That Could Strip the Boy Scouts of Tax Exempt Status Over Gay Ban

Back in February I posted about a bill introduced by openly gay California state senator Ricardo Lara (D-Bell Gardens) that would strip the Boy Scouts' tax exempt status for discriminating against members and leaders on the basis of sexual orientation or gender identity.

LaraToday that bill passed its first legislative hurdle, the AP reports:

The Senate Governance and Finance Committee voted 5 to 2 to move the first-of-its-kind bill to the Senate Appropriations Committee for review.

The Youth Equality Act, sponsored by Sen. Ricardo Lara, D-Long Beach, would deny tax-exempt status to youth groups that discriminate on the basis of gender identity, race, sexual orientation, nationality, religion or religious affiliation.

Should the bill pass the BSA would be required to pay corporate taxes on donations, memberships, and all other sources of income.

Said Lara in February:

“Our state values the important role that youth groups play in the empowerment of our next generation; this is demonstrated by rewarding organizations with tax exemptions supported financially by all Californians. SB 323 seeks to end the unfortunate discriminatory and outdated practices by certain youth groups by revoking their tax exemption privilege should they not comply with our non-discrimination laws.”


  1. Marty says

    This could be a tough constitutional battle with all of the church-based youth groups.

  2. JK says

    This could set a bad precedent. Do we really want to setup a system where we strip groups we don’t like of tax exempt status? We may be “in power/ favor” now but we were not always & won’t always be. If they wanted to say that only non-discriminatory groups could lease/ long term use public resources at discount that would be good. But tax exempt status… sounds like a dangerous path.

  3. says

    JK – your fears are baseless, and here’s why – it’s not about “groups we dont’ like” – it’s about groups that don’t follow the law.

    don’t buy into the “what if one day the olden-times come back and we get enslaved” sort of non-thinking – the world only spins forward.

    and this isn’t about ‘disagreements’ – it’s about law.

  4. Alex Parrish says

    Little Kiwi is correct — this is about following the rule of law. The BSA is free to discriminate as much as they want — they just can’t do it on my dime. There are laws about that and they have to follow them. It shouldn’t even require a special bill in the legislature; it’s against the law and the law should be enforced. I think the BSA does a lot of good for a lot of boys and I hate to see them being so recalcitrant about this issue but as long as they are, then they must not enjoy the favor of public funding — and, make no mistake, tax exempt status is just that.

  5. Arrant says

    Why in the world does Towleroad continue to use the marginalizing term “openly gay”?

  6. Gerry says

    As a California taxpayer all I can say is IT IS ABOUT TIME!!!

    It is one thing to give tax exempt status to an organization which is doing a public service. It is quite another to have your tax dollars go to an organization which excludes you from participating.

    They should also include Churches who by their policies discriminate – especially Catholics and Mormons who use their tax exempt funds to actively campaign against gay rights.

  7. JONES says

    The SCOTUS decision about the BSA being allowed to be discriminatory was because it was a ‘private’ organization. Private and yet tax exempt? Did the BSA previously have a select status in Calif to allow them to be tax exempt?

  8. Sean in Dallas says

    Nothing would make me happier than for the BSA, then the Baptists, Catholics, Mormons, et al, to lose their tax-exempt status.

    All that smirky, smarmy government-sanctioned superiority? Gone in a flash!

  9. woodroad34d says

    Good! The Boy Scouts is not a religious organization…it may be religious affiliated, but that’s all. They shouldn’t have tax exempt status in the first place. And when is it proper, outside of an actual church and Sunday Morning, for any organization to be above the law? I’m really beside myself that religion is the supreme right in our Bill of Rights and no one else matters. Time for them to become Americans first and to stop relying on prejudicial beliefs as if they’re reality.

  10. Francis #1 says

    JK, we’re in power? If you haven’t noticed, The Boy Scouts don’t allow openly gay scouts or troop leaders. The Boy Scouts are discriminating and the Boy Scouts are not a religious organization. They don’t deserve tax exemption and as Kiwi said, they’re breaking state laws in California.

    This is a very good step in the right direction. More states taking this step would put significant pressure on the Scouts to change their bigoted policy.

  11. David R. says

    Our Rainbow Families organization is tax-exempt at the (Washington) state and federal levels. This makes sense, since we are an educational and social “charity”. However, we do not discriminate in our membership.

    I don’t understand, however, why the California bill is targeting only youth groups. It seems to me that any organization that wants to be tax exempt not discriminate against the usual suspect categories.

  12. JK says

    Look, I would love to just get rid of tax exempt status for BSA & churches but it is not about who they serve, it is about being “non profit” and serving who they choose. That is the way the law is written and the proof of this is the fact that they are tax exempt currently and that has been re-affirmed. You can say “they are breaking the law” all you want but the fact is we would not have to CHANGE the law if it was true so we know on its face that it is NOT true. What we are doing is changing the law to make it true- which is dangerous territory.

    I think their policies are bad, wrong, & should be changed. I think their heads are firmly implanted where the sun doesn’t shine. However, I don’t like the idea of doing this. If the roles were reversed (as they have been & have tried in TN & could do in MS with no voter backlash) we would be up in arms.

  13. JK says

    @Little Kiwi

    Were I wish that it were so that the world only spins forward. However, one need only see the rise of despots, new genocides, and the LOSS of freedoms for gays in Russia to see that it does not always spin forwards for everyone everywhere.

  14. anthony says

    I am sure CA has “laws” on the books that do not allow merchants to discriminate sales towards the consumer public– case in WA against the florist.

    This would just be an extention “for the public as a whole” that people are NOT to be discriminated against–

    The Boy Scouts orgainzation is NOT a Religious Institution but a “Public Organization”.
    Hence….why not remove the “tax exemption”?

  15. Holdupaminute says

    This seems like an important, but symbolic gesture.

    Given the current U.S. Supreme Court rulings on the Boy Scouts, which grant them a “quasi-religous” status and protection from civil anti-discrimination laws, I think this would be found to be unconstitutional – unless of course the Supreme Court changes its mind.

  16. Rich says

    My first reaction to reading this was “Good! The Legislature is smiting our enemies.” But the more I think about it, the more convinced I am that this is bad law. The main difference between this and Prop 8 is that this is an action of the legislature rather than a plebiscite.

    The problem I am having is one of finding how the Boy Scouts differ from other private nonprofit organizations. The obvious choice, that they are a public accommodation, has been ruled out by the United States Supreme Court. We can protest this determination, but that carries as much weight as those who insist that abortion=murder, when the law says otherwise.

    On what basis can California treat the Boy Scouts differently than it treats the Roman Catholic Church, or the San Diego LGBT Center? The State has been broadly neutral in defining tax-exempt nonprofit organizations, and there are too many people on all parts of the social and political spectrum who have an interest in maintaining the nonprofit sector to be able to abolish its privileges across the board. And even if that were the will of Californians, we’d be treading on Federal Constitutional quicksand.

    @Senator Lara:
    Thanks for standing up for us, but SB 223 is just unwise.

  17. Kevin says

    What you’re all overlooking is that this legislation would affect their CALIFORNIA INCOME TAX EXEMPT STATUS. California is generally free to set whatever standsrds it desires to grant or withhold an exemption from the income tax.

  18. Rich says

    @Kevin “California is generally free…” except for those pesky equal protection clauses in the State and Federal Constitutions.

  19. DC Arnold says

    Has it escaped anyone’s notice that boy rapers (BSA) and child rapers (Catholic Church) don’t stop spouting antigay rhetoric until tax exempt status is raised?

  20. Joe in Ct says

    I agree, it’s time to stop using “openly gay.” Just “gay” will be fine for now. Eventually even that may not matter, either.

  21. Bill Michael says

    None of this would happen here in Kentucky because of the recent passage of HB-279 which gives churches and religious based organizations the specific right to opt out of anything that conflicts with their religious beliefs. It means state protected discrimination because under the new Kentucky law, the state MUST PROVE that they have a compelling interest to force religious groups to obey state law. The BSA can come to Kentucky and do anything they want and there’s no one who can say anything about it.

  22. Pete N SFO says

    At some point the BSA had to request a tax-exempt status from CA. That’s what is now in question.

    They aren’t automatically exempt. The state bestowed the status on them. They are not a religious group, but rather a group that provided a societal benefit that CA wanted to encourage.

    That’s why it can be taken away for not following CA law.

  23. Kevin says

    @Rich: You haven’t argued or shown that they are being denied 14A protections. Try again.

  24. mmike1969 says

    About damn time. Decent people in the state of California should not be spending their tax dollars to support bigotry.

    You in the BSA fought to be recognized a private group that can discriminate. Well now your fellow bigots can support you and your ignorance.

  25. BigCodyJack says

    the problem with this bill is that it applies also to gender discrimination so that any youth organization must allow both sexes to join and it also applies to private schools so no more girls schools. It also applies to religious preferences so that the Catholic Youth Organization must admit atheists and Protestants and Muslims. The US supreme Court bans the use of taxes as penalties to regulate conduct. The Franchise Tax Board estimates that it will cost violators a $1000 a year so it is clear that the Bill is not a revenue raising measure but a penalty.