The U.S. Supreme Court has refused to hear a long-running dispute over public funding of the former Kentucky Baptist Homes for Children.

The refusal puts the 11-year-old lawsuit back in the U.S. District Court for Western Kentucky, where it had been dismissed three years earlier.

The suit was filed in 2000, when employee Alicia Pedreira claimed she was fired from the home for being a lesbian and challenged public funding of the faith-based institution.

In 2008, U.S. District Judge Charles R. Simpson III dismissed the suit based on a new Supreme Court precedent ruling that just being a taxpayer doesn't give someone the ability to sue over a funding decision by the executive branch of government.

Simpson had earlier dismissed Pedreira's employment-discrimination claim, saying it was based on her lifestyle and not her religion.

The appeals court dismissed her discrimination claim but allowed a legal challenge to public funding of faith-based institutions to proceed.

The court said the plaintiffs have a right to try to prove their claim that the Kentucky legislature, not just the executive branch, knowingly funded an organization that allegedly mixed religion with social-service programming.