Supreme Court To Decide Whether Colorado Can Deny Funding For Catholic Preschools

The U.S. Supreme Court has agreed to hear St. Mary Catholic Parish v. Roy, a significant religious liberty case that pits Colorado’s universal preschool funding program against Catholic schools’ faith-based admissions and operational policies.

Earlier this week, the Court granted certiorari in an unsigned order (no dissents noted), limiting review to two questions from the petitioners’ November 2025 petition. Arguments are expected in the Court’s October 2026 term.

In 2020, Colorado voters approved Proposition EE, creating dedicated funding for voluntary universal preschool. The state’s Early Childhood Act and related rules established the UPK program, which provides free preschool (initially 15 hours per week, later expanded in some descriptions) to families at participating public, private, or faith-based providers. The goal: expand access and choice for all families, including through private options.

To participate and receive taxpayer funds, preschools must sign a nondiscrimination agreement. It requires offering “equal opportunity” to enroll and serve children regardless of race, religious affiliation, sexual orientation, gender identity, income, disability, or other protected characteristics. The program includes some targeted preferences or exemptions (e.g., for children of color, low-income families, those with disabilities, gender-nonconforming children, or LGBTQ+ families), but participating providers must still comply with the core nondiscrimination rule.

Catholic Preschools

Catholic preschools operated by the Archdiocese of Denver (including St. Mary Catholic Preschool in Littleton and Wellspring Catholic Academy/St. Bernadette’s in Lakewood) integrate religious formation with early education. They serve as faith-filled communities where children learn, pray, and grow alongside families who share or at least respect core Catholic teachings on faith, morals, sexuality, and gender (e.g., traditional Catholic doctrine on biological sex, marriage, and gender identity). Enrollment policies typically require families to affirm support for these beliefs; some policies also address practical matters like bathroom use aligned with biological sex.

The state determined these practices violate the equal-opportunity mandate - particularly with respect to sexual orientation, gender identity, and religious affiliation - because the schools do not guarantee enrollment to families whose beliefs or identities conflict with Catholic doctrine. As a result, the Archdiocese’s roughly 30+ Catholic preschools were categorically excluded, affecting over 1,500 children and families. At least one preschool closed, and enrollment at others dropped sharply (nearly 20% in some cases), forcing families to pay out-of-pocket or choose non-Catholic options.

Plaintiffs (two parishes/preschools, the Archdiocese, and parents Daniel and Lisa Sheley, who wished to use the benefit at a Catholic preschool) sued in 2023 via the Becket Fund for Religious Liberty, arguing Free Exercise Clause violations.

Lower Court Rulings

• District Court (2024): After a bench trial, it largely sided with the state on the nondiscrimination requirement but enjoined enforcement as to religious affiliation (due to certain program preferences). It found no broader First Amendment violation.
  
• 10th Circuit (Sept. 30, 2025): Unanimously affirmed for the state. It held the rule is a neutral, generally applicable law under Employment Division v. Smith (1990), so rational-basis review applies (and the rule survives). The court called Colorado’s approach a “model example” of balancing nondiscrimination with religious accommodation efforts, distinguishing it from recent Supreme Court precedents like Trinity Lutheran, Espinoza, and Carson v. Makin (which bar explicit religious-status discrimination in public benefits). No evidence of anti-religious hostility (unlike Masterpiece Cakeshop).

The 10th Circuit joined a minority position in a circuit split on when exemptions or discretion undermine a law’s “general applicability” under Smith. As the Epoch Times notes, the appeals court held that Colorado’s secular exemptions and discretion “did not undermine general applicability” - applying a Supreme Court precedent known as Employment Division v. Smith (1990). By doing this, the appeals court threw its lot in with the minority position in a circuit split regarding what kinds of exemptions and discretion are considered to undermine general applicability, the petition said.

The case is expected to be heard in the court’s next session, which begins in October.