Bob Jones takes the PR challenge: embattled school starts minority scholarship. (Update).

The establishment of a minority scholarship fund at any college or university would probably not be news, but Bob Jones University is not just any university.

Critics have routinely called the South Carolina school's policies racist, and the fact is that until March 2000, BJU banned interracial dating. But administrators dropped that ban after a wave of negative publicity followed a campaign visit by then Gov. George W. Bush.

Now administrators at Bob Jones want the headlines to tell a different story. Minorities are welcome, they say, and they're backing that promise with a $125,000 scholarship fund. Already, 25 students have received cash gifts up to $10,000, says Jonathan Pait, a communications coordinator at the school. Officials estimate that 10 percent of the 5,000 BJU students are minorities; 5 percent of all students are black.

Such gifts are not given lightly at Bob Jones, for the school lost Fights to tax-exempt status--a remnant of a suit brought against BJU by the IRS, which denied the status because of the ban on interracial dating.