The United States Department of Education announced on September 10 that it will cease providing grants to colleges based on their minority student enrollment percentages, declaring such practices unconstitutional. The agency stated that using federal funds to promote enrollment quotas based on race or ethnicity violates constitutional principles.
This policy shift affects numerous institutions across the country that are designated as Minority-Serving Institutions (MSIs). Under previous guidelines, these schools were required to maintain specific percentages of students from particular racial or ethnic backgrounds to qualify for federal funding. For example, Hispanic-Serving Institutions needed to maintain at least 25% Hispanic student enrollment, while Predominantly Black Institutions had to enroll at least 1,000 undergraduate students with a minimum of 40% being Black.
Education Secretary Linda McMahon emphasized that discrimination based on race or ethnicity is unacceptable in the United States. She stated that true diversity extends beyond skin color and that categorizing individuals solely by immutable characteristics diminishes their full personal qualities and achievements.
The decision affects multiple grant programs, including those supporting Hispanic-Serving Institutions, Predominantly Black Institutions, and various Native American and Pacific Islander-serving institutions. However, Historically Black Colleges and Universities (HBCUs) and tribal colleges remain unaffected, as their status is based on historical context and tribal governance rather than current demographic composition.
The fiscal year 2025 had approximately $350 million allocated for MSI programs. While $132 million in mandatory funding will still be distributed due to statutory requirements, the remaining funds will be redirected to programs that do not incorporate racial quotas.
The policy change follows a lawsuit filed in June by Tennessee and Students for Fair Admissions, challenging the Hispanic-Serving Institution program. The lawsuit argued that some Tennessee colleges, despite serving many low-income students, were excluded from funding solely because they fell short of the Hispanic enrollment threshold. The Department of Justice declined to defend the program, citing constitutional concerns and alignment with the Supreme Court’s 2023 ruling against race-based college admissions.
Looking forward, McMahon expressed interest in reforming these programs to support institutions serving underprepared or
under-resourced students without using racial criteria. She emphasized the importance of evaluating students as individuals rather than by their racial group membership.
The decision has sparked criticism from various educational leaders and lawmakers. The University of Hawaii, which lost two MSI grants, expressed concern about the impact on student support programs. Democratic Representatives Grace Meng, Adriano Espaillat, and Yvette Clarke, who chair three House caucuses, jointly condemned the decision, arguing it would reduce educational opportunities for students of color.
University of Hawaii President Wendy Hensel acknowledged the significant adjustments needed in resource allocation following the grant termination. The three House caucus chairs emphasized in their September 11 statement that Minority-Serving Institutions have historically played a crucial role in providing college access to students from diverse backgrounds.
The Education Department’s decision represents a significant shift in federal education policy, aligning with broader efforts to eliminate race-based considerations in educational programs while raising questions about how institutions serving minority populations will maintain their support services under the new guidelines.