The State of Tennessee and Students for Fair Admissions, the organization behind the U.S. Supreme Court case that ended race-conscious admissions, argues that using the ethnic composition of an institution’s student body to determine access to federal benefits violates the Constitution. Their lawsuit, filed in June 2025, seeks to prohibit the U.S. Department of Education from using the HSI program’s ethnicity-based requirements when determining eligibility for grants.
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The State of Tennessee and Students for Fair Admissions, the organization behind the U.S. Supreme Court case that ended race-conscious admissions, argues that using the ethnic composition of an institution’s student body to determine access to federal benefits violates the Constitution. Their lawsuit, filed in June 2025, seeks to prohibit the U.S. Department of Education from using the HSI program’s ethnicity-based requirements when determining eligibility for grants.
At the same time, leaders at these institutions question what feels like a relatively arbitrary target — and one that is higher than the 10% required for a college or university to be considered an Asian American and Native American Pacific Islander-Serving Institution or Native American-Serving Nontribal Institutions and lower than the 40% required to designate a Predominately Black Institution.
“Every institution has to serve all of its students, and particularly its underserved students, and that should be woven into the fabric of the institution’s mission,” says Dr. Ann-Marie Núñez, inaugural executive director of the Diana Natalicio Institute for Hispanic Student Success and a distinguished Centennial Professor at The University of Texas at El Paso.
A Target Under Fire
But now HSIs are the first enrollment-based institution type to come under attack by conservative organizations looking to end equity practices and programs across higher ed. The Trump administration’s Justice Department has declined to defend the HSI provisions, concluding that the eligibility criteria violate the equal-protection component of the Fifth Amendment. The Education Department subsequently announced that it would end discretionary funding for several minority-serving institution grant programs, including Title V HSI grants.
For Dan Morenoff, executive director of the American Civil Rights Project and lead lawyer in the HSI case, the constitutional question is straightforward.
The government, he argues, is using a racial or ethnic threshold to determine which institutions can access a federal benefit without tying that classification to evidence that the institutions themselves have caused or perpetuated discrimination.
Under strict scrutiny, courts ask whether a racial classification serves a compelling government interest and whether the policy is narrowly tailored to achieve that interest, Morenoff said.
Núñez and her colleagues have been studying the relationship between HSI status and the emerging Carnegie classification of Opportunity Colleges and Universities. According to their findings, HSIs are more than three times as likely to receive the Opportunity Colleges and Universities classification, which recognizes institutions that contribute to students’ economic mobility.
HSIs are “regional anchors, great at providing movement for their graduates,” she says.
The institutions also enroll a substantial share of the nation’s college students and Pell Grant recipients, she said, while many charge relatively low tuition. Those characteristics make the consequences of withdrawing support difficult to separate from broader questions about who will have access to higher education and who will enter the workforce with a postsecondary credential.
“A consequence of defunding the institutions that the largest numbers of Pell grant recipients low-income students, people who historically might not have gone to college is that you’re going to have fewer people in the workforce, fewer people trained for the jobs,” Núñez says. “There needs to be a recognition that producing these outcomes needs to be rewarded with an investment in these institutions.”
Morenoff agrees that institutions should be rewarded for the heavy lift associated with educating disadvantaged students, but he holds fast to the idea that the HSI designation is flawed.
“If there are reasons under [the HSI funding model], there are better ways to serve [students],” he says, adding that programs that specifically look at an institution’s propensity to serve high populations of low-income students or English language learners would be acceptable criteria for additional funding.
He also draws a distinction between a remedial program designed to address a specific history of discrimination and the HSI program, which does not require an institution to demonstrate that Hispanic students have been harmed by the institution itself, pointing to the fact that though HSIs often serve higher percentages of low-income and first-generation students, these are not hard requirements of the designation.
“The only criteria that isn’t waivable is the ... racial percentage — it’s the fundamental feature of an HSI that you can’t get around,” he says.
The litigation itself, however, has not produced a final ruling eliminating the statutory HSI designation. Hispanic Association of Colleges and Universities and LatinoJustice PRLDEF have intervened in the case to defend the program. And the lawsuit’s comparison to race-conscious admissions does not map neatly onto how many HSIs operate.
Access Under Threat
“A lot of HSIs are open access, a lot of them are community colleges, so admissions are not relevant,” Núñez says. And that distinction is central to how she views the issue.
The HSI designation does not tell a college whom to admit, rather, it identifies institutions whose undergraduate enrollment meets the federal Hispanic enrollment threshold, alongside other statutory eligibility requirements.
Not only that, Núñez says there is a misconception around how enrollment translates to funding for these institutions.
“I think there’s three myths around HSI that are being operated with, and the first is that HSI grants are race-exclusive when, in fact, the grants use institutional criteria ... to strengthen capacity for all students,” she says.
Núñez continues, saying a second misconception is that every HSI automatically receives federal funding. What is actually true is that the designation only allows institutions compete for a small pool of funding that, at best, might comprise 10 to 15% of the institutional budget.
“When you consider a university budget and the amount of an HSI grant in comparison of that, they’re modest investments,” she says.
That broader institutional impact matters, because HSIs occupy a particular place in the higher education landscape. Many are broad-access institutions, including community colleges, that enroll large numbers of students who are first-generation, low-income or otherwise less likely to have had access to college.
“They’re really to serve all students and make innovation better,” she says, pointing to interventions such as targeted advising and other institutional improvements supported through HSI grants. “Targeted advising ... doesn’t hurt white students.”
Defining Servingness
Still, few would disagree that simply hitting the 25% enrollment threshold is a reliable measure of whether an institution actually serves Hispanic students well.
In fact, some of the field’s leading HSI scholars have spent years arguing that enrollment is only the starting point.
Gina Garcia, a professor at the University of California, Berkeley School of Education and a leading scholar of HSIs, developed the concept of “servingness” as a way to distinguish between enrolling Latino students and actually creating institutional structures that support their success. Her work examines servingness through factors including institutional identity and mission, curriculum, student services, faculty and staff, organizational structures, and relationships with surrounding communities.
In an August 2025 essay responding to the Tennessee lawsuit, Garcia argued that even if the litigation succeeds in dismantling the federal framework, institutions will still have to reckon with the students they enroll.
“Servingness is about action and movement, not about enrollment numbers,” she wrote.
That distinction has become increasingly important as more institutions reach HSI eligibility because of demographic change.
An institution can have a large Hispanic enrollment without necessarily having made serving Hispanic students part of its institutional mission. Garcia has argued that genuine servingness requires more intentional work: examining disaggregated student data, incorporating culturally responsive approaches into curriculum and student support, building relationships with communities and considering who holds positions across the institution.
“If I were to think about servingness more expansively, it would be strategies that promote student opportunity,” Núñez says.
The discussion around servingness complicates the idea that preserving the federal designation alone would solve the problem, because while the federal government can determine whether an institution meets a numerical eligibility threshold, it cannot determine whether students feel seen, whether academic programs reflect their communities, whether advising meets their needs, or whether an institution has changed the structures that produce unequal outcomes.
Núñez says that while language is important — and the Hispanic-serving institution desgination keeps Hispanic students at the forefront — “actions are also really important.” She points to institutions and departments “where people are using messaging and slogans and feel like they’re doing the work, and people don’t feel like they’re being served” as an example of how the designation itself doesn’t go far enough to articulate the mission of the institution.
“If the institution does the work, [serving Hispanic students well] will be the outcome,” she says.
That framing challenges leaders to consider that even if the federal government can no longer use the 25% threshold as the basis for targeted HSI funding, institutions will still have work to do to serve those students, even as they navigate a changing funding environment.
Education too often is framed as a cost, not an investment,” Nuñez says. “I think all of the consequences with all of these cases, all of these actions, it’s the students who are going to be hurt the most, and the workforce is not going to be developed.”
“When is the breaking point beyond which institutions are not going to be able to serve their students well as higher education increasingly gets defunded,” she asks.
This story originally ran in The EDU Ledger's October 1, 2026 edition. Subscribe here for full access.
