In the 1946 case of Everson v. Board of Education, a New Jersey taxpayer challenged his state's policy of reimbursing parents for transportation costs to and from schools, including private religious institutions. The plaintiff argued that this violated the Establishment Clause in the First Amendment which prohibits government support of religion. However, the Supreme Court ruled in favor of the Board by a 5-4 vote stating that while states cannot promote or sustain religions, they also can't prohibit their citizens from receiving general public benefits because they are attending parochial schools. This decision was significant as it applied federal constitutional restrictions on religious establishment not only to federal government but also to state governments under Fourteenth Amendment incorporation.

In the dissenting opinion for Everson v. Board of Education, Justice Wiley Rutledge argued that providing public funds to transport children to parochial schools violated the Establishment Clause of the First Amendment. He contended that such an action constituted government support for a particular religion, which is explicitly prohibited by the Constitution. Rutledge emphasized that while freedom of religion must be protected, it should not be promoted or subsidized by taxpayer dollars in any form - including transportation subsidies for religious school students. He also expressed concern about potential future implications if this precedent were allowed to stand; he feared it could lead to further entanglement between church and state down the line.