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This is a partial transcript of The Big Story With John Gibson, July 16, 2004, that has been edited for clarity.

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JOHN GIBSON, HOST: President Bush getting a lot of support on the campaign trail, but some supporters are being told to watch what they say and where they say it. Churches and religious groups aren't supposed to endorse a candidate; it would violate their tax-exempt status. Reverend Jerry Falwell's (search) recent e-mail supporting President Bush has drawn a complaint.

He joins us now from Virginia. And in Washington is Rob Boston, from the group Americans United for the Separation of Church and State (search).

Rob, we'll start with you. Today's big question: are religious groups getting too involved in this election?

ROB BOSTON, AMERICANS UNITED FOR THE SEPARATION OF CHURCH AND STATE: Well, I think there certainly are clear guidelines from the IRS that say that religious organizations can address moral, social, and political issues, but they cannot endorse or oppose candidates for public office. If they violate that standard, their tax exemption will be looked at. But, other than that, they can do lots of other things.

GIBSON: All right. But is Reverend Falwell violating that standard?

BOSTON: Clearly. I mean, he sent out an e-mail under the auspices of Jerry Falwell Ministries telling people that they should vote for President Bush. Then he directed them to a PAC that's collecting money for Republican candidates: clear violation of the tax law. One of Falwell's other ministries, "Old Time Gospel Hour," had its tax exemption revoked back in 1993, and I think we're going to see the same thing again.

GIBSON: So Reverend Falwell, before we get into the deeper issues, did you do that stuff?

REVEREND JERRY FALWELL, CHANCELLOR, LIBERTY UNIVERSITY: Well, first of all, Rob heard that from his boss, Barry Lynn. The fact is that "Old Time Gospel Hour," or any other ministry with which I've been associated has never lost its tax exemption. We still operate, we're tax-exempt, and no church, no church — write this down — not one church in the history of the American public has ever lost its tax-exempt status for political involvement. Not one ever and Rob also knows that.

Now, let me tell you why...

BOSTON: That's wrong. That is wrong.

FALWELL: That one church in New York lost their tax letter for one day, for one day, but never its tax-exempt status and that church in Binghamton, is still operating tax-exempt today.

Now, the reason this all happened is that about this time, every election year, about this time or the next two weeks, "Americans United" will write a letter, a scare letter, to thousands of conservative evangelical churches and pastors telling them how terrible it will be and how they'll endanger their tax exemption if they speak out for a conservative candidate.

Now, they don't write those letters to the churches where Jesse Jackson, Al Sharpton, Al Gore, John Kerry's been to three African-American churches the last few weeks, or Bill Clinton, only to our churches, with the idea of frightening us because two-thirds of all Americans who attend church regularly vote pro-life, pro-family, i.e. George Bush.

Now, what I did recently, John, was this: I'm a publisher of a monthly newspaper, monthly magazine and a weekly newsletter, and as a publisher, I send out my op-ed pieces, my editorials on a regular basis, just like the NAACP makes their statements against George Bush and they're tax-exempt like we are. And they want everybody to come out of the closet these days, except they want to drive Christians back into the closet. We ain't going nowhere. (sic) We are pro-Bush. We are pro-life. We're pro- family and "Americans United" don't scare us one bit.

GIBSON: Well, Reverend Falwell, let me ask Mr. Boston this. Rob, let me ask you this: there is a suspicion, Rob, that what's going on here is I don't see your group going after black church groups...

FALWELL: Of course not.

GIBSON: ... which regularly call for their people to get out and register and then vote for the Democrat, whether it's Clinton, Gore, or Kerry. So why pick on Falwell?

BOSTON: Well, you and Dr. Falwell are wrong about that. Back in April...

FALWELL: No, we're not wrong about that.

BOSTON: Let me finish, Jerry. ... we reported the Charles Street AME Church in Boston, whose pastor endorsed John Kerry from the pulpit; we wrote to the IRS, just like we wrote to the IRS about Dr. Falwell, we asked them to investigate, we asked them to revoke that church's tax-exempt status, if they decide that that's what needs to be done.

GIBSON: Yes, but Rob...

BOSTON: This is wrong regardless of what type of church it's happening in.

GIBSON: This is a nationwide movement in African-American churches, and it's generally considered OK for those pastors to get their voters out to vote.

BOSTON: It's illegal. It's illegal.

GIBSON: It may be illegal, but we don't hear you going after all of them.

FALWELL: John, let me tell you something that nobody wants to. Let me tell you what Barry Lynn...

BOSTON: We've reported dozens of those over the years. We've reported dozens. In fact, the first church that got us interested in this was an effort by Jesse Jackson, back in 1988 to actually collect money in churches on Sundays. We put a stop to that.

GIBSON: OK. All right. I'll tell you what, we will follow how this goes. Reverend Falwell, I know you're going to straight ahead. Mr. Boston, I know you will, too. But I got to run, thanks to both of you.

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