Salazar v. Buono, which the Court agreed to hear today, involves a relatively unusual fact pattern (quoting the federal government's statement of the Question Presented in its petition for review):
More than 70 years ago, the Veterans of Foreign Wars (VFW) erected a cross as a memorial to fallen service members in a remote area within what is now a federal preserve. After the district court held that the presence of the cross on federal land violated the Establishment Clause and the court permanently enjoined the government from permitting the display of the cross, Congress enacted legislation directing the Department of the Interior to transfer an acre of land including the cross to the VFW in exchange for a parcel of equal value. The district court then permanently enjoined the government from implementing that Act of Congress, and the court of appeals affirmed. The questions presented are:
1. Whether respondent has standing to maintain this action where he has no objection to the public display of a cross, but instead is offended that the public land on which the cross is located is not also an open forum on which other persons might display other symbols.
2. Whether, even assuming respondent has standing, the court of appeals erred in refusing to give effect to the Act of Congress providing for the transfer of the land to private hands.
But resolving this question may well lead the Court to reconsider the deeper constitutional question -- should the Establishment Clause be read as presumptively barring government speech that endorses religion? My guess is that there are now 5 votes on the Court rejecting the endorsement test: Justices Scalia, Kennedy, and Thomas, who have criticized the test in the past, and Chief Justice Roberts and Justice Alito, who I suspect (based on the jurisprudential camp from which they come) would agree with the other conservatives.
To be sure, there are other ways the Court could avoid the problem; it can conclude that:
Respondent (Buono, who successfully challenged the cross) doesn't have standing, for the reasons the government gives.
Respondent doesn't have standing, because simply being exposed to religious speech -- even if it violates the Establishment Clause -- isn't enough of an injury to allow standing. (This would have the effect of rejecting most challenges to government religious speech, but would leave government officials presumably still honor-bound by the existing substantive precedents, and would leave those precedents enforceable as a matter of federal constitutional law in those states that have more relaxed standing requirements.)
Even if there was an Establishment Clause problem when the government maintained the cross, privatizing the cross -- even in a way that's pretty clearly structured to preserve the cross on a little island of private property on government land -- avoids any such problem.
Even if the Establishment Clause prohibits speech that a well-informed observer would see as endorsing religion (that's the standard articulation of the endorsement test), a well-informed observer would see the cross here as a war memorial, not an endorsement of religion.
There is also another possible problem for the Court: Given that the memorial is a cross, then if it is seen as a religious symbol (i.e., if theory 4 noted above isn't accepted), it would presumably be seen as a symbol for Christianity as such. And some language in Justice Scalia's opinion in McCreary County v. ACLU suggests that Christian-only symbolism might be unconstitutional even though a more ecumenical (Christianity/Judaism/Islam-friendly) "acknowledgment of a single Creator" should be permissible. (See here for more on Justice Scalia's argument in McCreary.)
Nonetheless, it's also possible that five of the Justices might conclude that the underlying problem is the endorsement test, that the test is not only mistaken on the merits but is also too indeterminate to be reliably administered, and that the Court should provide lower courts and government officials clearer guidance for a wide range of cases by concluding that government speech isn't made unconstitutional by its endorsement of religion. Such provision of guidance for future cases is an important part of the Court's function, and the endorsement test's critics have long argued that the Court's adoption of that test has been a failure on that score. In any case, should be quite a case to watch (unless the Court decides the major issue in Pleasant Grove City v. Summum, which I doubt, given the posture of that case).