Tuesday, July 23, 2013

Senate Committee Hears Testimony about Military Tuition Funding Loophole at For-Profit Institutions

Today, the Senate Homeland Security and Government Affairs Committee took up a loophole that allows for-profit colleges to exclude veteran's benefits and military tuition assistance in calculating the amount of federal student aid those colleges receive. The federal government imposes a 90% cap on the amount of money that for-profit institutions may receive from federal student-aid programs annually. Currently, the GI Bill and other educational benefits for veterans do not count towards that 90%. Closing that loophole has been an on-going effort in Congress for some time, as we noted in an earlier post Are For-Profit Colleges Targeting Military Students?

Last year, 21 state attorneys general wrote to Congress to support closing the loophole, citing their concerns about for-profit colleges' high pressure recruiting tactics and low graduation rates of veterans. The current 90% rule means, a veterans' advocate told the Committee, that "[e]very veteran that a for-profit school recruits is worth nine more students using federal financial aid."  Read more at The Chronicle of Higher Education here.

-ld

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