A minority scholarship program spent most of its money on overhead.
Legislative Audit Committee
January 9, 2026
The audit of the Charles W. Donaldson Scholars Academy landed hard for one reason: when you strip away the good intentions, the numbers don’t work.
Legislative Audit’s review of the Donaldson Scholars Academy, a minority scholarship and support program housed at UA Little Rock and funded with $10 million in state desegregation money, revealed a program that spent most of its money on overhead and had an abysmal graduation rate.
The failures were clear.
💸 Most of the Money Didn’t Go to Students
Over the life of the program:
- Total expenditures: $8,449,764
- Scholarships awarded: $1.87 million
- Students served: 379
- Graduates: 116
That means roughly $6.58 million — about 78% of all spending — went to overhead, including:
- salaries and benefits
- travel
- administration
- food and catering
- programming and activities
Only about 22% of total spending went directly to scholarships.
Rep. Howard Beaty put it bluntly.
“Out of $10 million, what, $1.8 million actually went to students?” he said. “What a joke.”
🎓 The Cost per Graduate: About $73,000
When total spending is divided by outcomes, the price tag becomes harder to ignore.
- Total graduates: 116
- Total spending: $8.45 million
That works out to about $72,800 per graduate. Comparable student-success programs typically cost between $10,000 and $50,000 per graduate. At roughly $73,000 per graduate — with only about 30% of participants finishing college — the Donaldson program sits well above common benchmarks for cost efficiency.
For context, Arkansas’s average six-year college graduation rate for students who start college is about 47%. This program graduated roughly 31% of participants — at a per-graduate cost well above common benchmarks for student-success programs.
Lawmakers didn’t mince words.
“That would only be about 30 percent,” Rep. Johnny Rye said. “It just seems awful low.”
UA Little Rock did not dispute the numbers.
“We do not contest those figures,” Associate General Counsel Charles Lyford told the committee.
🚫 Scholarships Were Often Awarded to Ineligible Students
The audit found that the program’s written rules were clear, yet frequently ignored.
The scholarship was designed as $2,500 per year, renewable up to four years, with eligibility requirements that included:
- full-time enrollment
- minimum GPA
- credit-hour thresholds
- a four-year cap
Audit staff tested 10% of scholarship recipients and found exceptions in 32 of 39 students reviewed.
Those exceptions included:
- students exceeding the four-year maximum
- students below GPA requirements
- students short on required credit hours
- students enrolled longer than allowed
- students not enrolled full-time
Of the $350,000 in scholarship awards tested, nearly 32% went to students who did not meet eligibility requirements.
🧾 Disbursement Controls Were Nearly Nonexistent
Problems extended well beyond scholarships.
Auditors reviewed 147 non-payroll disbursements totaling $1.9 million and flagged 124 exceptions.
Those included:
- missing or improper authorization
- missing documentation
- clerical inaccuracies
- two capital assets whose disposition could not be determined after the program closed
This wasn’t a handful of paperwork errors. It was the overwhelming majority of transactions tested. And we won’t even mention the trip to Morocco.
🏫 Outcomes Varied Sharply by Institution
Graduation rates differed dramatically among the three participating schools:
- UA Little Rock: ~28%
- Philander Smith College: ~39%
- UA Pulaski Technical College: ~56%
Pulaski Tech produced the strongest outcomes with the smallest cohort. UA Little Rock enrolled the most students and graduated the smallest percentage.
That disparity caught lawmakers’ attention.
🧍♂️ And No One Is Left to Answer for It
Perhaps the most frustrating part of the hearing: the people who ran the program are gone.
All employees materially involved, including the director, are no longer employed by UA Little Rock. One is deceased. Others are no longer in state government, and in at least one case, not believed to be in Arkansas.
Rep. Steve Unger summed up what many were thinking.
“Good intentions met a pot of money and came out with bad results,” he said.
“There needs to be one person who owns this, who could put their name on the blame line.”
⏸️ What Happens Next
Lawmakers chose not to rush a decision.
The committee tabled the report, asking for:
- more time to digest the findings
- additional documentation
- clarification of federal court oversight
- and answers from institutions that did not initially appear
This program wasn’t declared illegal. But the audit made one thing clear: it was expensive, loosely controlled, and delivered weak results for the money spent.
For now, the report is paused, but the questions it raised aren’t going away.
