It seems hard to believe in a country that honors church-state separation, but Prison Fellowship Ministries, founded by ex-Watergate felon Charles Colson, was effectively given an entire wing of Iowa’s Newton Correctional Facility a few years ago, and Colson’s group created what was basically a state-sponsored evangelism program (called InnerChange).

A federal court struck down funding for the program as a blatant violation of the First Amendment, explaining, “For all practical purposes, the state has literally established an Evangelical Christian congregation within the walls of one of its penal institutions.... There are no adequate safeguards present, nor could there be, to ensure that state funds are not being directly spent to indoctrinate Iowa inmates.”

The case (filed by my former employer, Americans United for Separation of Church and State) went to the 8th Circuit on appeal, and today the appeals court agreed that the faith-based program is unconstitutional.

Americans United presented evidence that inmates who took part in InnerChange were given better treatment and perks that were not available to others, including better housing and expedited access to classes required for parole…. At trial, inmates testified that they were pressured to convert to evangelical Christianity, and that the beliefs of Roman Catholics and other faiths were ridiculed. The court record showed that non-Christians were frequently referred to as “unsaved,” “lost,” “pagan” and “sinful” by InnerChange staff. The program required staffers to abide by an evangelical statement of faith.

In a unanimous decision joined by retired Supreme Court Justice Sandra Day O’Connor, the appeals court upheld a lower court ruling issued on June 2, 2006, except that it reversed a portion of the lower court ruling that required InnerChange to return funds it received prior to June 2006. InnerChange will still need to return funds it received after the June 2006 ruling.

It's the latest major setback for Bush's faith-based initiative.