The Future of Race-Based Scholarships in Higher Education

It’s now been three years since the United States Supreme Court declared that race may never be used as a “negative” or operate as a “stereotype” in higher education. While that landmark case, Students for Fair Admissions v. Harvard, dismantled affirmative action in admissions, race still lingers as a factor in many other areas of higher education.

One such area is financial aid—specifically grants and scholarships. The National Scholarship Providers Association estimates that 11% of all higher-education scholarships still contain eligibility requirements for race, ethnicity, or other demographic factors, even after SFFA.

Race-based scholarships, though, are facing increasing scrutiny. Last month, the Wisconsin Supreme Court struck down a race-based scholarship created by the Wisconsin Legislature in 1985. The scholarship provided taxpayer-funded grants to students based on need. Critically, however, the scholarships were available only for “minority undergraduates.” And even that definition further restricted eligibility by providing that only certain minorities qualified: blacks, American Indians, Hispanics, and Asians from Laos, Vietnam, and Cambodia. All other students were excluded because of their race. 

The Wisconsin Institute for Law & Liberty (WILL) sued the State on behalf of Kiki Rabiebna and Richard Freihoefer, a married couple. Kiki is a native of Thailand and Richard is a white American. They have a teenage son who is entering college in Wisconsin this fall. But because of race and ancestry, no one in the Rabiebna-Freihoefer family was eligible for the scholarship. 

The left-leaning Wisconsin Supreme Court sided with WILL and its clients, unanimously holding that the scholarship’s racial qualifications violated the 14th Amendment. In the Court’s main opinion, Justice Ziegler explained that the Constitution requires “all individuals to be treated equally without regard to one’s race, ancestry, origin, or ethnicity.” And each citizen must be treated “as an individual—not as one member of a class.” 

The Court rejected the government’s claim that it needed the scholarship to “equalize educational opportunities by offering financial aid to some, but not all students to retain preferred classes of students.” Such a claim was neither compelling nor supported by any evidence, and because race was the deciding factor, the scholarship was not narrowly tailored. 

The victory for equal rights in Wisconsin followed on the heels of several other cases around the country that ended race-based scholarships. Earlier in June, the Iowa Supreme Court blocked the University of Iowa from using private donations to fund black students. In April, the American Bar Association settled a case brought by the American Alliance for Equal Rights, agreeing to remove racial qualifications in ABA’s Legal Opportunity Scholarship. 

And in December, the Office of Legal Counsel of the U.S. Department of Justice issued a memorandum opinion explaining how race-based scholarships violate federal nondiscrimination law. In 2025, several other scholarships were opened to all races following litigation or threats of litigation, including scholarships at the University of California, grants offered by the State of Illinois, and even private scholarships offered by McDonald’s. 

These are certainly welcome results, but there are still many more discriminatory scholarships that require reform. The University of Wisconsin, for example, continues to offer at least 22 scholarships containing racial eligibility requirements, despite two civil-rights complaints filed by WILL on behalf of Young America’s Foundation. University officials claim race-based scholarships are permitted when deployed in a “pool and match” scheme. 

During this process, students are promised a certain amount of aid, and then minority students are “matched” with race-based scholarships. Non-minorities are then funded through the remaining “pool” of funds, ensuring that no student receives less money because of race. Yet this is a classic separate-but-equal policy, long ruled unconstitutional, and unlikely to survive a constitutional challenge. WILL has filed a lawsuit to challenge this scheme as a violation of the Equal Protection Clause of the U.S. Constitution. 

These victories confirm that race-based scholarships cannot withstand constitutional scrutiny. Yet many colleges and universities continue to maintain racial preferences in financial aid. Reformers in other states should not lose hope merely because they face progressive headwinds—Wisconsin, after all, proves that equality can win even with a liberal-controlled court. The Constitution and federal law are clear: educational opportunities must be awarded without regard to race. Until every remaining racial criterion is eliminated, the principle of equal treatment under law will remain only partially realized.

Dan Lennington is Managing Vice President and Deputy Counsel at the Wisconsin Institute for Law & Liberty, where he leads the Equality Under the Law Project. Since 2021, WILL has represented over 80 clients from 26 states in pursuit of complete racial equality for all Americans. Find more information at www.will-law.org.