The Justice Department’s Office of Legal Counsel issued a memo this month concluding that several federal grant programs targeted to minority‑serving institutions (MSIs) run afoul of constitutional limits on race‑based criteria. The memo identified programs for Hispanic‑serving institutions, Native Hawaiian‑serving institutions and similar designations as unlawful if they continue to use racial or ethnic thresholds for eligibility. The legal opinion gives the Education Department cover to redirect discretionary MSI funding and prompts immediate planning questions for colleges that depend on those grants for capacity‑building, STEM pipelines and student supports. Education Secretary Linda McMahon praised the memo as restoring “merit and fairness” in grant allocation. Higher‑education leaders and civil‑rights groups warned the memo could strip targeted funding from institutions that serve large shares of low‑income and first‑generation students. Legal challenges and legislative responses are likely as affected campuses and state systems weigh their options.