HANNIBAL (HLGU) – Hannibal-LaGrange University (HLGU) announced, Feb. 6, the resolution of its federal lawsuit against the Department of Education. This landmark settlement protects the constitutional right of Baptists to establish and maintain schools that reflect their faith, doctrine and values, without being forced to abandon their commitments to provide affordable education.
Under a prior administration, federal regulators applied a rule designed for for-profit colleges to Christian universities, forcing an impossible choice: sever ties with the churches that give Christian schools their identity, or lose eligibility to serve students who need federal aid.
“This regulation didn’t just misunderstand Baptist polity,” said HLGU President Robert Matz. “It attacked it. The regulation treated churches like corporate owners and assumed that spiritual oversight must come with financial liability. That’s foreign to Scripture, to Baptist life, and to the First Amendment.”
After months of fruitless negotiations, HLGU filed suit. The regulation caused real harm—delaying and denying Pell Grants for incarcerated students in the University’s prison education program who were ready to change their lives.
The university reached a settlement that removes the unconstitutional burden, but students who were denied or delayed aid won’t see those funds recovered. The university absorbed nearly $700,000 to cover their education.
“This settlement is a necessary victory, not a complete one. Students were harmed. Churches were put at risk. The fact that the university had to sue at all is a reminder that religious freedom requires constant vigilance,” Matz said.
“This settlement confirms a critical principle,” said Jonathan R. Whitehead, HLGU’s counsel. “Federal student aid participation cannot be used as leverage to dismantle religious governance.”
The lawsuit argued the regulation violated the First Amendment and the Religious Freedom Restoration Act by forcing institutions to weaken their religious governance as a condition of federal program participation. HLGU noted that imposing requirements on Missouri Baptists brought no new financial security, as the incorporated association of churches does not hold assets.
Under the settlement, the Department of Education will not enforce the owner-entity signature requirement in 34 C.F.R. § 668.14(a)(3)(ii) against HLGU, and will instead apply the governing statutory framework in 20 U.S.C. § 1099c(e). The agreement clarifies that the Missouri Baptist Convention will not be forced to provide financial guarantees for HLGU, Missouri Baptist University, or Southwest Baptist University simply because it appoints their trustees.
The case was dismissed on January 16, 2026, the same day the department issued new guidance to all schools as a result of the lawsuit.
While this agreement is specific to HLGU, the principle it secures is broader: churches can remain churches, and Christian universities can remain Christian—without forced separation. Governance structures across Southern Baptist life are similar.
“This case was never about paperwork,” Matz said. “It was about whether Christians would be free to educate the next generation in faithfulness—without the government forcing them to cut ties with the very churches that make the university’s mission possible. HLGU stood because standing was required.”