Ocean City Church Sues Town Over Homeless Shelter Ban

Ocean City, MD - St. Paul's By-The-Sea Episcopal Church has filed a lawsuit against the Town of Ocean City, claiming the town is violating its religious rights by ordering it to stop housing homeless people inside the church.

The lawsuit was filed June 16, 2026 in the U.S. District Court for the District of Maryland (Northern Division). Plaintiffs include the church, Senior Warden Daniel Harris, and the Reverend Jill Williams, the church's rector.

The defendant is the Mayor and City Council of Ocean City.

According to the complaint, St. Paul's has fed and sheltered Ocean City's homeless population for years. The church says it began offering hot lunches five days a week in 2024, serving 50 to 60 people in the off-season and double that in summer.

The complaint states that in 2025, Ocean City passed an ordinance banning people from sleeping in public places for more than 24 hours. St. Paul's responded by allowing homeless guests to sleep in tents on church grounds, the lawsuit says.

The Town then directed the church to stop the outdoor camping and move people inside instead, according to the complaint. St. Paul's says it agreed, arranged a fire marshal inspection, and moved everyone into a dormitory-style setup inside the church hall by April 1, 2026.

But the lawsuit claims the Town later reversed course. In a May 8, 2026 letter, the Town reportedly ordered the church to expel its homeless guests by June 8, citing zoning restrictions. The complaint says noncompliance would trigger daily fines.

According to the filing, the Town began issuing $1,000 civil citations to Harris and Williams on June 8, 2026, and has continued daily since.

The church itself has not been cited, the complaint notes.

St. Paul's argues its actions are rooted in Episcopal Church doctrine, citing "social gospel" teachings to care for the poor and marginalized. The complaint quotes Presiding Bishop Sean Rowe's December 2025 Christmas message: "The birth of the Christ Child heralds a new reality where the last shall be first, the hungry will be fed, and the stranger among us shall be welcomed as a beloved child of God."

The lawsuit raises two claims: a violation of the First Amendment's Free Exercise Clause, and a violation of the Religious Land Use and Institutionalized Persons Act (RLUIPA). The church argues its zoning district already permits similar uses, like rooming houses and lodging houses, and that the "barracks-style" label the Town used doesn't accurately describe its setup.

St. Paul's is asking the court to declare the Town's actions unconstitutional, void the fines, and issue a permanent injunction stopping further enforcement. The church is also seeking attorneys' fees and costs.

The Town of Ocean City has not yet filed a response in court.

Eastern Shore Undercover reached out to the Town of Ocean City for comment or response, however at the time of the publication, they did not respond to our emails.

This story will be updated as the case develops.

Update 6/18/2026 at 9:15 AM 

This morning, we were fortunate enough to get a response from Town of Ocean City - City Manager, Mr. Terry McGean. Mr. McGean sent us the following from the Town of Ocean City:

"As to the specifics of the lawsuit that has been filed, the Mayor and City Council cannot comment on active litigation. What we can say is that the Town has a history of supporting programs and services for individuals experiencing homelessness. The Mayor and City Council of Ocean City has, for many years, provided financial and other support to Diakonia, the homeless shelter located in West Ocean City including significant support for the proposed expansion of this long legally established shelter. The Town also participates and actively supports the Worcester County Homeless Outreach Team (HOT) which works to provide a full range of services including counseling, medical assistance and permanent housing for the homeless. The Town has a responsibility to ensure that all properties and facilities comply with established zoning, building, occupancy, and safety codes, and operate within allowed uses. Code provisions are applied consistently to all properties in Ocean City in order to protect the health, safety, and welfare of both occupants and the broader community." - Terry McGean