Bob Benzel had quite a few people on his mind in 2019.

The students who the former Ralston High School art teacher watched drop out after becoming pregnant.

His mother, who, in her late 30s, earned her GED and associate’s degree while raising four kids by herself.

The family friends who made their communities better, despite not having easy access to higher education.

And Benzel himself, having grown up gay on a farm outside the village of Potter.

Those people led Benzel and his husband, Gerry Sullivan, to create a fund for five scholarships at Metropolitan Community College — money they earmarked to go to single mothers, first-generation students and LGBTQ learners.

That’s who quietly benefited over the past five years. And that’s who Benzel believes will be harmed by MCC’s recent decision to eliminate scholarships with any kind of preference based on a student’s background.

Since March, MCC and other Nebraska colleges and universities have revised their guidelines for awarding scholarships in an attempt, they say, to comply with new guidance from the Trump administration. The directive instructed schools and higher-ed institutions to eliminate long-accepted practices now deemed discriminatory or risk losing federal funding.

Scrutiny isn’t coming from just the federal government. The Flatwater Free Press found that the University of Nebraska at Omaha recently removed preferential language from two scholarships that were the subject of a complaint filed by a national advocacy group that opposes affirmative action.

The funding threat has school leaders walking on eggshells, administrators and experts say.

MCC’s explanation didn’t fly with Benzel after the foundation director at the time told him they could no longer offer scholarships like the one for LGBTQ students. 

Given the option to open the scholarships to all students, Benzel and Sullivan instead took their money back. They plan to donate the remaining $45,000 to a fund supporting LGBTQ students in California, where they now live.

“When do these kids get a chance to get their life together and escape poverty? And how do you get people who are constantly being pushed into life without an education? How are they ever going to get ahead?” Benzel said. “If a place like Metropolitan Community College is not actively looking out for these kids, who is?”

‘Protect The Greater Good’

MCC’s decision to eliminate all preferential scholarships came after Valentine’s Day, when the U.S. Department of Education sent out a “Dear Colleague” letter condemning “pervasive and repugnant race-based preferences and other forms of racial discrimination.”

The letter threatened to pull federal funding from any schools or colleges that failed to end policies and actions deemed discriminatory.

“All students are entitled to a school environment free from discrimination. The Department is committed to ensuring those principles are a reality,” the letter states.

MCC officials did not want to jeopardize federal funding or grants, which benefit a much larger number of students, said Chris Swanson, MCC’s associate vice president of pathway support systems.

“It just made sense to make these changes to protect the greater good and to serve more students as a whole,” Swanson said.

The decision impacted a minuscule number of scholarships and students, Swanson said. Through its foundation, the college offered fewer than 10 preferential scholarships. Most offered smaller dollar amounts that only partially funded a student’s education, and a few were out of funding.

MCC overall offers 200 scholarship types totaling $7 million, some $3.8 million of which comes from taxpayers. Roughly half of the college’s student body receives scholarships, Swanson said.

“On balance,” Swanson said, “we were talking about those small handfuls of things versus Title IV funding for all of our students receiving federal financial aid.”

Those students who previously received scholarships still received funding — it just came from a different source, Swanson said.

‘Scary Across The Board’

Multiple four-year institutions across the state have confirmed to the Flatwater Free Press that they have similarly adjusted their guidelines, including the University of Nebraska system, Chadron State College, Peru State and Wayne State College.

The University of Nebraska at Omaha, in particular, is currently facing backlash from multiple entities, including the Equal Protection Project, a campaign led by a nonprofit that opposes race-based policies.

The group filed a complaint with the Department of Education last month alleging two of the university’s scholarships violate Title VI of the Civil Rights Act of 1964, which prohibits intentional discrimination on the basis of race, color and/or national origin.

“Regardless of UNO’s reasons for offering, promoting, and administering such discriminatory scholarships, UNO is violating Title VI by doing so,” the complaint states.

UNO’s Dreamers Pathway scholarship was for Deferred Action of Childhood Arrivals (DACA) or DACA-eligible Nebraska residents. The scholarship is no longer listed on UNO’s scholarship website and the link now leads to the Forward Together scholarship for Nebraska residents.

Its HDR scholarship had a preference for underrepresented minority students at the time the complaint was filed, but UNO has since eliminated that preference from the scholarship’s language.

UNO is one of about 100 institutions across the country that have faced complaints from the group.

Separately, the Department of Education announced in March that it is investigating UNO for allegedly engaging in race-exclusionary practices in its graduate programs.

In an initial statement, university officials said they continually evaluate the university’s scholarships and are committed to complying with all federal and state laws.

They did not immediately respond to a request for additional comment Wednesday after Flatwater discovered the changes made to the two scholarships.

Dorothy Endacott, the vice president of marketing communications for the University of Nebraska Foundation, said 65, or 1%, of the foundation’s 5,697 different funds for scholarships are in the process of being modified to be as close as possible to the original intent while complying with the law.

Some had donors who were deceased, Endacott said, so the foundation either worked with the Nebraska attorney general to modify their criteria or had changes approved by the foundation’s board of directors.

National scholarships are being affected as well. McDonald’s changed its HACER National Scholarship Program in January following a settled lawsuit brought by the American Alliance for Equal Rights, a nonprofit that challenges preferences made on the basis of race and ethnicity.

The program, originally intended for Latino students, is now open to any student who can demonstrate an impact on or commitment to the Latino community.

The actions targeting UNO and other entities have caught the attention of administrators elsewhere.

“I’m nervous for our four-year counterparts, our private liberal arts institutions, in terms of positioning for higher education funding,” said Swanson at MCC. “It’s scary across the board as an industry.”

The recent moves come in the wake of a 2023 U.S. Supreme Court ruling outlawing the use of race as a factor in a college’s admissions process.

Paul Weitzel, an assistant professor of law at the University of Nebraska-Lincoln, said the Department of Education’s current interpretation of federal statutes is unprecedented because scholarships like the ones created by Benzel and Sullivan helped, not hindered, underrepresented groups.

“It’s not really clear what’s permissible or impermissible discrimination anymore,” Weitzel said. “It’s an active debate in the country right now whether you should be able to discriminate on the basis of race in a way that helps minorities.”

The debates at MCC are happening across the country, said Wil Del Pilar, the senior vice president of EdTrust, a left-leaning organization that researches and advocates for racial and economic equity in education.

Most institutions are conceding to the new administration, often more than they necessarily need to, for fear of paying for issues to go through the courts, Pilar said. Many had the same reaction to the Supreme Court’s ruling on affirmative action, he added.

“There is incredible political pressure that may even be greater than the legal ramifications that institutions may face,” Pilar said, referring to college and university leadership.

Swanson said the stakes at MCC go well beyond any single group of students. If MCC lost federal funding, it would be forced to close — a move that would carry negative consequences across Dodge, Douglas, Sarpy and Washington counties.

“The economic engine of our four-county area would crawl to (a) halt,” Swanson said. “And so I think, yes, tens of millions (of dollars) for us, but potentially hundreds of millions for our workforce area.”

While acknowledging the reasons behind MCC’s decision, Benzel said that the students his scholarships supported still need it.

He and Sullivan have since shifted their donations toward the National Rainbow College Fund, administered by a foundation in San Diego.

Benzel predicts the decisions made by MCC and others will have lasting negative impacts.

“I think it’s going to ultimately get other people to be looking at exit ramps out of Nebraska, just like we did,” he said.

This story was originally published by Flatwater Free Press, an independent, nonprofit newsroom focused on investigations and feature stories in Nebraska that matter. Read the article at: https://flatwaterfreepress.org/federal-funding-threats-are-pressuring-ne...