I think so, so long as it's done the way the Catholic schools around here do it and not the way some of the others do.
The Catholic schools have "A" opportunities and "B" opportunities. A are hard and sweaty ones, B are fun ones. As you get older, the more A hours you have to earn. In either case, the community service has to be real and verifiable and something that benefits the community.
At least one Baptist school in the Baton Rouge area has community hours, but it's something of a joke, because many of the kids do stupd stuff that doesn't do anyone any good, just gives them something to sign off on their sheets.
In the first case, the kids are learning about the benefits of helping others and how much good they can do in the community and what kind of value it should have in their own internal life.
In the second case, at least some of the kids aren't learning anything more than how to be whited sepulchers.