In In re Ezra L. Totton Scholarship, the Iowa Supreme Court considered whether the University of Iowa could modify the terms of a scholarship established nearly three decades ago for Black students pursuing degrees in the physical sciences.
The scholarship was created through the will of Dr. Ezra L. Totton, a distinguished Black chemist who had been denied admission to the University of Tennessee’s graduate chemistry program during the Jim Crow era because of his race before later earning a graduate degree from the University of Iowa. In his will, Dr. Totton left 40% of his estate in equal shares to five organizations he described as his “favorite charities,” including the University of Iowa, the University of Wisconsin, Knoxville College, North Carolina Central University, and his church. While each educational institution received scholarship funds supporting students in the sciences, only the University of Iowa and University of Wisconsin scholarships were expressly restricted to Black students.
When the University received the bequest in 1997, the attorney administering Dr. Totton’s estate advised that if the University could not comply with the terms of the gift, it should return the funds. The University nevertheless accepted the gift, which established the Ezra L. Totton Scholarship for “Black students majoring in the physical sciences, preferably chemistry.” Over time, the endowment grew to approximately $58,000 and funded annual scholarships for Black students studying chemistry.
Following the United States Supreme Court’s 2023 decision in Students for Fair Admissions v. Harvard, the University concluded that continuing to administer a race-restricted scholarship presented significant legal concerns. Invoking Iowa’s version of the Uniform Prudent Management of Institutional Funds Act (“UPMIFA”), the University petitioned the court for permission to modify the gift by replacing the requirement that recipients be Black students with a preference for first-generation students while otherwise preserving the scholarship.
The trial court dismissed the University’s petition, reasoning that no court had conclusively held that Students for Fair Admissions prohibited privately funded scholarships administered by public universities. The Iowa Supreme Court reversed.
The Court explained that UPMIFA permits a court to modify a charitable gift when its original purpose or restrictions become “unlawful, impracticable, or impossible to fulfill.” Importantly, the Court emphasized that the University did not need to prove the scholarship had already been declared unlawful. Rather, it was sufficient that administering the scholarship had become impracticable in light of the changed legal landscape.
The Court concluded that Students for Fair Admissions significantly altered that landscape. Although the Supreme Court’s decision directly addressed race-conscious admissions, the Iowa Supreme Court observed that its reasoning broadly condemned race-based governmental decision-making outside of narrow exceptions. The Court also noted that lower courts, federal agencies, and the U.S. Department of Justice had since interpreted Students for Fair Admissions as extending beyond admissions decisions to other race-based educational programs, including scholarships. The Court further observed that the U.S. Department of Education had already opened investigations into universities offering race-restricted scholarships. Taken together, these developments made it impracticable for the University to continue administering the scholarship under its existing terms.
Nevertheless, the Court rejected the University’s proposed modification. Although the University argued that replacing the racial restriction with a preference for first-generation students would preserve Dr. Totton’s broader goal of assisting historically underrepresented students, the Court found no evidence supporting that conclusion. Instead, the record demonstrated that Dr. Totton specifically intended to benefit Black students in light of his own experiences overcoming legally enforced racial segregation. The Court emphasized that substituting a new eligibility criterion effectively created a new restriction rather than preserving the donor’s charitable intent. The Court further noted that Dr. Totton’s estate had expressly anticipated the possibility that the University might someday be unable to administer the scholarship as written, directing the University to return the gift if it could not comply with the donor’s conditions. That instruction reinforced the Court’s conclusion that any modification should adhere as closely as possible to Dr. Totton’s original intent.
The Court therefore remanded the matter for further proceedings. It instructed the trial court to consider other potential modifications that more faithfully reflected the donor’s intent, including removing the racial restriction entirely or directing the scholarship funds to another institution better able to carry out Dr. Totton’s original charitable purpose. The Court also emphasized that future proceedings should include meaningful participation by an advocate for the donor’s intent and that the trial court could consider the donor’s entire will and relevant extrinsic evidence concerning his charitable objectives.
In re Ezra L. Totton Scholarship (June 5, 2026, No. 25-0462) 2026 WL 1614078.
Note: This decision illustrates the increasing number of challenges following the Students for Fair Admissions decision involving race-conscious scholarships and donor-restricted gifts. Private schools that administer restricted scholarships should consider reviewing existing scholarship criteria to assess whether changes in federal law affect their continued administration while also remaining mindful of their fiduciary obligation to honor donor intent whenever possible.