LANSING, Mich. (AP) — Faith-based adoption agencies that contract with the state of Michigan can refuse to place children with same-sex couples under a proposed settlement filed in federal court Tuesday, months after the U.S. Supreme Court ruled for a Catholic charity in a similar case.

The Michigan Department of Health and Human Services (MDHHS) said the high court’s ruling against Philadelphia is binding on the state and limits its ability to enforce a non-discrimination policy.

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“While this outcome is not what we hoped for, we are committed to providing support to the many members in the LGBTQ+ community who want to open their hearts and their homes,” Demetrius Starling, executive director of the Children’s Services Agency, said in a statement.

In 2019, Lansing-based St. Vincent Catholic Charities sued the state, challenging a deal Attorney General Dana Nessel announced to resolve an earlier lawsuit brought against the state by lesbian couples who said they were turned away by faith-based agencies.

That agreement said a 2015 Republican-backed law letting child-placement agencies deny services that conflict with their sincerely held religious beliefs does not apply if they are under contract with the state.

“We believe this agreement advances the common good, benefits Michigan’s vulnerable children, and upholds the constitutional right to religious liberty that is a cornerstone of our state and nation,” said David Maluchnik, spokesperson for the Michigan Catholic Conference.

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Michigan, like most states, contracts with private agencies to place children from troubled homes with new families.

U.S. District Judge Robert Jonker in Grand Rapids blocked Attorney General Dana Nessel’s deal prohibiting faith-based agencies from excluding same-sex couples from services — saying her action conflicted with state law, contracts and established practice. Settlement talks began after the Supreme Court in June said Philadelphia wrongly limited its relationship with a Catholic foster care agency that says its religious views prevent it from working with gay couples.

Under the preliminary settlement, Michigan cannot terminate or block renewal of St. Vincent’s contracts because the agency does not approve a same-sex or unmarried couple as foster or adoptive parents, place a foster child with them or conduct a home evaluation. The state must pay St. Vincent $550,000 for attorney fees and costs.

The deal still needs the judge’s approval.

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