Race Considerations and Independent Schools
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1 Race Considerations and Independent Schools Debra P. Wilson August 2017 The Trump administration is once again in the headlines on the education front, this time for soliciting applications for the creation of a legal team within the Department of Justice to challenge affirmative action programs in higher education. Consideration of race within admissions, both in K-12 and higher education institutions, has long been a topic of hot contention. Schools use such considerations to create a more diverse student population, one that reflects the general population, for the good of all students and the institutions themselves. The potential for challenges from the federal government itself is a reversal of longtime federal support for lawful affirmative action programs. Although this recent spate of activity has caused a fair amount of concern, particularly within higher education, there has been no official word from the Trump administration on what the creation of this legal team means or on the administration s official policy. Originally, there was some speculation that these investigations would specifically focus on reverse discrimination cases brought against colleges and universities. These suits are largely brought by white students claiming they were discriminated against. Still other speculation quickly grew that this initiative might be broader, including actions such as the one brought against Harvard University by a group of Asian students. The Department of Justice did release an official statement that the investigation would relate to a suit brought by Asian students, a statement also met with skepticism. Understandably, higher education is unsettled by this recent movement within DOJ. However, independent schools are wise to watch this activity and be mindful of potential action as well as court precedents that might be set. While the Trump National Association of Independent Schools 1
2 administration s activities could impact our industry directly, it could also trigger an increase in challenges from individuals wanting to question a school s policy or approach. Independent schools often lawfully consider race within their processes, and the laws to which independent schools are subject in this area track quite closely with higher education. Schools that consider race in admissions or administration of financial aid should review their practices and ensure they align with expected practices in this area to avoid possible challenges. Applicable Law There are three main federal legal areas independent schools need to watch when it comes to potential racial consideration challenges. The first two are directly related and are the laws mainly at issue with the kinds of action the Department of Justice is considering. The first is Title VI, which prohibits discrimination on the basis of race within institutions that receive federal financial assistance. Title VI applies holistically; if the athletic department receives federal financial assistance, Title VI extends to admissions and everywhere else as well. Title VI permits legal action for reverse discrimination, the genesis of most of the current case law from the Supreme Court. Independent schools that do not participate in federal programs also need to be aware of what is happening in this arena, as the second law applies to all independent schools and shadows the first. Title 42 of the US Code, Section 1981, prohibits racial discrimination in private contracts. This statute has been found to apply to admission in independent schools. The legal review of a claim under this statute may not be as stringent as that applied under an action brought under Title VI, although the differences between the legal analysis is often slight. 1 1 See Runyon v. McCrary, 427 U.S. 160 (1976). National Association of Independent Schools 2
3 The third law that can be triggered here relates directly to the school s nonprofit status, the IRS Revenue Procedure That revenue procedure requires schools to have nondiscrimination statements in admissions materials, complete a particular schedule on the form 990, and maintain nondiscriminatory practices. This law should not be stirred up in the midst of the recent actions within DOJ, but it bears keeping in mind as this revenue procedure is overseen by the IRS and is firmly under control of the agency. Policy changes within the administration could affect how this revenue procedure is overseen and administered. More information about those requirements and potential issues can be found in this NAIS publication. Enforcement of Title VI and Section 1981 The Office for Civil Rights (OCR) of the Department of Education is the primary enforcer of Title VI among educational institutions, although complaints can be filed with the Department of Justice. An individual who believes they were wrongly discriminated against may bring a suit against a school under either Title VI or Section 1981, or both. The Trump administration s decision to create a unit within the Department of Justice is unusual as it appears to be moving the issue from DOE as well as from the department within DOJ that would normally be involved, namely the Educational Opportunities Section. For institutions within the line of fire, this is a more serious issue as the Office of Civil Rights within the DOE tends to rectify complaints and situations with remediation approaches as opposed to lawsuits. Application of Title VI and 1981 Title VI and 42 USC 1981 forbid institutions from discriminating on the basis of race, color, or national origin in admissions and other areas. The courts hold any consideration of these characteristics to the highest standard of review, called strict scrutiny. This standard requires that consideration of these attributes must serve a compelling interest and that the consideration of the characteristic be narrowly tailored to achieve that interest. In a case studying the University of Michigan s National Association of Independent Schools 3
4 admissions policy several years ago, the Supreme Court clearly stated that striving to bring diversity to education can be a compelling interest. In 2013 the Court revisited this conclusion in a lawsuit brought against the University of Texas and maintained its stance. In coming to these decisions, the Court noted that schools need not attempt every alternative to racial consideration and that institutions deserve deference in defining a compelling interest. Schools should be aware that K-12 independent schools have limited case law in this area from which to learn. On one hand, independent schools are very much like higher education, building their own classes through an admissions process. On the other hand, schools must be aware the Supreme Court has indicated that compelling interests such as building diversity are not as persuasive in the public school K-12 context, particularly when the schools do not consider other diversity characteristics such as special skills and other background considerations. For this reason, there is some concern about how a court might view a diversity rationale for independent K-12 schools. Given that independent schools are neither institutes of higher education nor the state providing public education, it may be a bit difficult to determine how the courts may view a school's argument in this area. It is a reasonable argument that because independent schools are not public institutions, charged with the responsibility of educating the entire K-12 population, and the schools consider each applicant individually in light of myriad factors, that the paradigm given to higher education is appropriate. Fundamental Guidelines Given the administration s potential new focus on this topic and the lack of particularly clear case law for our industry, schools should be extremely aware of their admissions approach. If an independent school is going to consider race in its process, it should work with legal counsel to ensure its approach is appropriate under both state and National Association of Independent Schools 4
5 federal law. Existing case law does help provide some overall guidance for independent schools. The following largely reflect what the Supreme Court has articulated in Grutter v. Michigan and Fisher v. Texas as fundamental to a successful approach. The school must have a clearly articulated diversity justification for its admissions policy. The University of Michigan noted that diversity has substantial benefits in the education environment, including preparing students to live in a diverse working world, breaking down stereotypes, and invigorating classroom discussion. The University of Texas included: destruction of stereotypes, promotion of crossracial understanding, preparation of a student body for an increasingly diverse workforce and society, and more. Schools considering race in admissions decisions should have a written policy about how they consider race and why they do so. The consideration of race must be narrowly tailored to achieve the goal. o The process must ensure there is competition between applicants. Race should never be considered in a way that supersedes competition between students. This happens when strict point systems are used, quotas are in place, and separate admissions processes are used. o There should be no quota or particular percentage aim. The school officials at the University of Michigan law school had an estimated percentage range between 10 and 17 percent of the class, but the percentage varied from year to year. o The school should give individualized consideration to each applicant. Independent schools typically excel in this area, but schools that have an overwhelming number of applicants and have an initial weeding-out process should be very careful about how they approach the initial screening of applicants. National Association of Independent Schools 5
6 o The school should consider alternatives to racial considerations. Such examples are economic, geographical, etc. o The policy needs to have a duration component. The admissions policy should have either a sunset provision or a routine review to determine if the policy is still necessary. Step-by-Step Considerations These guidelines may require some work to implement in a meaningful way. In approaching this topic, it is important to remember that although the best of intentions may be focused on designing a fair system, those intentions are not often included in the publicity that may go along with a lawsuit for reverse discrimination. Schools going through the process below should carefully document their work here as it may be important in the event of a lawsuit. o Review your school s consideration of race in the admissions process. Chances are high that your school does consider race in some way in order to build a more diverse student body. o If this is so, create a policy statement reason for this consideration, noting your school s interest in building a more diverse student body. o Once the reasoning for your policy is in place, you must review your policy. Consider the following: Is race considered in a way that puts minority students outside the realm of equal competition for offers of admission? Hallmarks of this problem are: quotas, percentage goals, strictly-adhered-to point approaches, flagging of files, separate consideration of minority students from other students, and repeated coincidences of similar percentage representations in each class. o The University of Michigan law school used the term critical mass when approaching the diversity of its student body. This leaves the proportion National Association of Independent Schools 6
7 of minority students a little more ambiguous. This vague language implies the determination of a class s racial makeup should be derived more from educational judgment than percentage requirements or goals. o Are there other non-race-based traits that may achieve the same objective? In reviewing the University of Michigan law school approach, the Supreme Court determined the university had engaged in a serious, good faith consideration of workable race-neutral alternatives that will achieve the diversity the university seeks. Showing that your school has also considered these options may help. Are there economic or other considerations that might be made instead? o Document the school s consideration of these alternatives. o Does your school individually consider each applicant? o If your school receives so many applications that you must make an initial cut, take the time to give the applicants closer consideration than basic numbers. Standardized tests have been found to have an uneven impact on minority test-takers in the past. Consider other diversifying traits. Schools should be clear that they consider other diversifying traits in their applicants. In the words of an American Council on Education piece: Courts are likely to tend to favor policies that, for example, review each apparently qualified applicant s entire application; give substantial weight to diversity factors other than race and ethnicity in a manner that could make a real, dispositive difference for nonminority applicants as well as minorities; admit only those minority students deemed academically qualified; take into National Association of Independent Schools 7
8 account nonminority applicants contribution to diversity; admit some nonminority applicants whose grades and test scores are lower than those of some of the rejected minority applicants; and do not admit virtually every minimally qualified underrepresented minority applicant. o Once you are comfortable with your approach, build in a regular review and evaluation aspect to the program. This may be a set time period, or a periodic evaluation to ensure that consideration of race is still necessary to achieve diversity within your student body. This is an important element both to ensure the ongoing necessity of the approach as well as a risk management check on the school. o Have your counsel determine your state s law in this area and review your policy. This is one area where it makes sense to have your counsel provide you with a written overview of your policy and review the policy regularly to ensure your school is in compliance with the law. Conclusion NAIS schools work hard at diversifying their school communities in any number of ways. These considerations often trigger no legal concerns, but those relating to protected classes that have been specifically recognized by state and federal laws require special handling and consideration to ensure that schools stay on the right side of the law as they implement their policies. Common Questions May an independent school make oral or written pre-admission inquiries regarding race and ethnicity? Schools may ask this question, but they need to be very careful with how they use the information. Any information related to the status of an individual in a protected class can be used against a school later if the school used the information improperly. The U.S. Department of Education has provided additional guidance noting that an application for admission must clarify that disclosure of racial and ethnic information is National Association of Independent Schools 8
9 solely voluntary, the information will be kept confidential, and a refusal to provide the information will not subject the applicant to any adverse treatment. 2 Race and ethnicity information should be used only to the extent that it helps the school achieve articulated and compelling education goals as noted above. Schools collecting and using this information should document both the compelling reasons why a school considers race and ethnicity as well as a its decision-making process. 3 Does federal law require an independent school to publish a statement of nondiscrimination on the basis of race and ethnicity? Yes, if it receives federal financial assistance or is tax-exempt under Section 501(c)(3). Title VI requires this publication for entities that received federal financial assistance and nonprofit independent schools are required to publish such a statement to maintain their nonprofit status. An independent school that is tax-exempt under Section 501(c)(3) must include a statement of nondiscrimination with respect to race in all brochures and catalogs dealing with student admissions, programs, and scholarships. 4 More information on this topic is available in this NAIS publication. May we administer race-based scholarships on behalf of donors? Schools are occasionally asked to administer scholarships that are very focused on the race of the applicant. These are often the focus of donor-advised funds or other gifts. It is generally wise not to get involved in the acceptance of donations for the direct administration of a scholarship that is race-based. However, schools can work with donors who would like the tax deduction to set these scholarships up in such a way that the scholarship complies with federal law as outlined above. These scholarships often have race-neutral characteristics that 2 See 42 U.S.C. 2000d; 34 C.F.R. Part 100. Title VI provides that no person in the United States shall, on the ground of race, color, or national origin, be excluded from participation in, be denied the benefits of, or be subjected to discrimination under any program or activity receiving Federal financial assistance. Id. Program or activity includes all of the operations of a private entity that provides educational services. See 34 C.F.R (g)(3)(i)(B). 3 See Guidance on the Voluntary Use of Race to Achieve Diversity and Avoid Racial Isolation in Elementary and Secondary Schools, U.S. Department of Education, Office for Civil Rights (December 2011), available at (last visited 7/20/16). 4 See Internal Revenue Service: Rev. Proc ( C.B. 587), available at National Association of Independent Schools 9
10 will achieve goals similar to those that the donors are seeking without exposing the school to liability. For example, these scholarships might focus on economic status, neighborhoods, or other background characteristics. Alternatively, the donors may decide to set up the scholarship and not take the tax deduction, administering the scholarships themselves and paying the student s tuition as any other tuition payment. The school may make this information available to the students and leave the students to apply for these scholarships on an individual basis. If your school would like to work with these donors, it is a good idea to determine the parameters for such scholarships in advance (such as requiring that scholarship have race-neutral selection criteria) so that the school s approach is very clear. Your school s counsel will be very helpful in this area. May we consider race when awarding financial aid? In general, cases relating to consideration of race in relation to financial aid and scholarship awards have tended to award a little leeway. The theory is that not awarding aid is slightly different from not granting access to the institution at all. However, schools are wise to implement the steps described above in relation to their financial aid policies as well as to their admissions policies because it is very likely that courts will view financial aid in a somewhat similar fashion. National Association of Independent Schools 10
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