It should come as no surprise that California has taken the lead in enacting legislation that restricts the way private universities make their key admission and scholarship decisions. This intervention is not only at the college level, but under AB 1780, the restriction also covers activities in both graduate and professional schools, with these blunt words: “(a) It is the intent of the Legislature to stop the practice of legacy and donor admissions and protect students as they pursue their higher education.” The legislation applies only to “a nonpublic higher education institution (formed as a nonprofit corporation) in this state that grants undergraduate degrees, graduate degrees, or both.” In so doing, it prohibits a practice that has enjoyed widespread support at private institutions for many years. It thus represents a political judgment that these universities have made serious mistakes in running their own shops that should be overcome by legislative fiat.
My views run in the opposite direction. Programs that endure do so only because they supply benefits to these institutions that may well be compromised by a diktat imposed from above.
There are multiple motivations for AB1780, not the least of which is a fierce reaction to the United States Supreme Court, which in Students for Fair Admissions v. Harvard College (2023) struck down the affirmative action programs at both Harvard and the University of North Carolina as violative of the equal protection clause of the Constitution. As Justice Neil Gorsuch noted in concurrence, Harvard and UNC also thumbed their noses at Title VI, which itself was at best a mixed blessing. It is just not acceptable to say that since our applicant pool is overstocked with students with superb test scores and grades, that it is all right to go down several levels on both scales to include diverse admits who don’t meet the highest standards. Yet I have long been opposed to giving the government any say over the operation of private universities, which means opposing Title VI even though it commands wide public support. But so long as Title VI is the law of the land, elite schools like Harvard and UNC have to obey it, along with everyone else.
I also disagree with the chief justice in SFFA for not drawing any distinctions between the government as regulator and the government as manager of a complex institution, like a university, where sound theory allows for far greater discretion in their second role—which means, in principle, that a total ban on affirmative action is a general mistake. At this point, the great tragedy in American higher education is that too many affirmative action programs in the name of diversity have gone so far off the rails that it seems that neither private nor public universities as a group are capable of drawing the right balance. In this second-best world, there is either too much or too little affirmative action, where too little affirmative action is probably a better bet than far too much.
What is odd about the rhetoric surrounding AB 1780 is that it appears to cut the legs out from under any diversity program by putting forth a near absolutist appeal exclusively to “merit, skill, and hard work” as the sole determinants of who gets into these elite institutions. “AB 1780 aims to ensure that admissions decisions are based on merit rather than personal connections—reducing biases in the admissions process at private colleges in California.” Toward that end, AB 1780 requires that all private universities submit an annual report that requires nonpublic universities to state annually that they are in compliance with the law. But the key oddity of AB 1780’s sanction is that any university that reports that it is in compliance with the law need not file any further information that allows either the Legislature or the California Department of Justices to check its claims, which hardly seems the way to catch cheaters under this program.
On the other hand, if a private university does report a violation, then:
(c) regardless of the number of violations, [it] shall include in its report both of the following for that academic year:
- The legacy status, donor status, race, county of residence, income brackets, and athletic status of newly enrolled students at the independent institution of higher education.
- The admission rate of students who are provided a legacy preference or donor preference in admissions, as compared to the admission rate of students who are not provided a legacy preference or donor preference in admissions.
One violation triggers this massive form of oversight without any sense of what sanctions should be imposed apart from having the Department of Justice “post the names of the independent institutions of higher education that violate subdivision (c) on its Internet website by the next fiscal year after receiving reports pursuant to subdivision (d).”
Omitted from these reporting requirements are any violations of the merit principle for those universities that continue to use race-based preferences, unrelated to merit. So, the entire scheme raises two questions. Does it make sense, and is it an unconstitutional regulation of private institutions by state governments?
On the former, the standard justification for the proposal refers to the huge advantage that admission to highly selective colleges (defined as the eight Ivies along with Duke, MIT, Stanford, and the University of Chicago—the so-called “Ivy plus” institutions) have in taking dominant leadership positions in America. No one should doubt the truth of the proposition, carefully documented in a Harvard report by Raj Chetty, David Deming, and John Friedman that finds: “Less than 1 percent of Americans attend these twelve colleges, yet they account for 13.4% of those in the top 0.1% of the income distribution, a quarter of US senators, half of all Rhodes scholars, and three-fourths of Supreme Court justices appointed in the last half-century.” Yet what inferences should be drawn from this impressive record of accomplishment? I think that no one should ever tamper with the institutions that sustain over time this unrivaled measure of success, which may well be bolstered by their legacy and donor preferences. The two sets of preferences contribute a solid source of income to these universities, defraying the cost of educating students and allowing these institutions to cross-subsidize faculty hires, research facilities, and scholarship support to well-qualified students of lesser means, including diversity admits.
Yet the Harvard study never addresses whether any of these “Ivy plus” universities will maintain the same overall excellence in intellectual talent and research support if loyal alums and large donors are shown the door. Those poor results will become apparent if donor and legacy gifts start to dry up when this program is put into place—assuming that it has any teeth, which is far from clear. But the more successful this program is in changing the composition of the student body, the more likely these institutions will falter from their stellar levels of achievement, by attracting a weaker student body working with fewer resources.
And so, with this prospect in view, is AB 1780 unconstitutional when applied to private institutions in its full rigor? The probable answer should be yes. Way back in 1819, the US Supreme Court in Trustees of Dartmouth College v Woodward held that it was a violation of the contract clause, which states “no state shall . . . pass any . . . Law impairing the Obligation of Contracts,” to displace private trustees, who had vested rights under a charter, with a board chosen by the New Hampshire legislature. AB 1780 is not that dramatic, but it is close, when, without displacing the trustees, it interferes with key financial and academic activities of a private institution. Unlike the decision in SFFA, there is not a shred of constitutional justification for claiming that these private institutions have deviated from some applicable constitutional norm when they extend preferences based on wealth, not race. Thus, given both First Amendment and contract clause claims, the basic issue is what does California know about the complex internal operations of these private institutions? The declarations accompanying AB 1780 never once address any of the unintended consequence that follow from what could turn out to be a major interference with private activity if aggressively enforced by the state.
To be sure, California private universities may well be loath to take on the state government, which has so many levers that it can use to turn up the pressure on any university prepared to mount this constitutional challenge. But there is also an established procedure dating back to the New Deal decision in Carter v. Carter Coal (1936), whereby a single trustee can bring suit against a private corporation (here, a university) to enjoin the implementation of this law, even before it goes into effect in September 2025.
The simple point is that it is just too risky to allow this ill-formed and incomplete statute, directed to donors and legacies, to go into effect when no one has made any concerted effort to assess the unintended consequences.
