The 2014 Supreme Court decision in the Hobby Lobby case, which ruled family owned companies cannot be required to offer insurance coverage for services that go against their religious beliefs, a decision that agreed with the plaintiffs that "religious freedom" had been violated, has been among the drivers for states seeking additional religious freedom laws.
The Indiana RFRA is one of 24 introduced in 15 states this year that could allow someone to use their religious beliefs to discriminate—numerous other bills specifically single out the LGBT community for unequal treatment, according to the American Civil Liberties Union, which tracks the developments online.
Pence said in his Thursday statement—the signing of the law was conducted in private—"This bill is not about discrimination, and if I thought it legalized discrimination in any way in Indiana, I would have vetoed it. ... For more than 20 years, the federal Religious Freedom Restoration Act has never undermined our nation's anti-discrimination laws, and it will not in Indiana."
"Make no bones about it, the Hobby Lobby decision has been interpreted to mean no one has to follow nondiscrimination laws," said Stacey Long Simmons, director of public policy at The National LGBTQ Task Force. She noted that corporations nationwide have come out mostly against these measures because they understand the dollars at stake that could flow into a state, from sports arenas to conventions.
Indianapolis is playing host to the NCAA Final Four in April, and a notable critic of the governor's decision was the Christian Church (Disciples of Christ), which sent a letter to Pence on Wednesday threatening to cancel its 2017 convention—it has held its convention in the city several times, and Indianapolis has estimated the economic impact at $6 million.
"It's shocking this governor did not follow the lead of Arizona's Jan Brewer, who saw the handwriting on the wall and paid attention," Simmons said.
Last year, Arizona Gov. Jan Brewer was persuaded to veto a similar measure, at least in part due to vocal opposition from business interests.
While there is no statewide economic impact analysis of Indiana's law available, the Williams Institute at UCLA Law School has conducted research that suggests nondiscrimination protections are good for businesses.
Tim Schultz, head of the 1st Amendment Partnership, an organization that supports RFRA legislative efforts, said, "The best way to evaluate the effects of these religious protection laws is to look to the commentary of scholars with no political agenda" and pointed to a letter signed by more than a dozen professors from prominent law schools in the U.S. which argued there is no reason to believe the new law would be interpreted by Indiana courts as providing businesses with a right to discriminate. Though many other legal experts have argued against the law, raising the question of whether any legal expert's opinion can be divorced entirely from Schultz's "agenda" labeling.