Csteve is correct, you aren't supposed to be able reduce scholarship based on performance. They can for academic performance or social behavior. At the end of the day though, coaches always get their way. Both academic performance and social behaviour are subjective terms, so coaches can apply them anyway they want.
Not uncommon for coaches to bring guys in on a certain % scholly, then schools ask to reduce it the next year "for the team". Or they'll reduce without asking because you got a B in a certain class or they saw a picture of you drinking a beer. Its a cutthroat business. There are tons of nasty stories out there.