NCPA - National Center for Policy Analysis

Veterans and Higher Education

September 23, 2013

The post-September 11 GI Bill provides education benefits to veterans who serve at least 90 days on active duty. It covers up to 36 months of costs for even the most expensive public colleges in the country where tuition, books and living allowances average more than $17,500 a year. Eligible institutions include technical schools, traditional or community colleges, and flight schools, say Kyle Buckley, a former graduate student fellow with the National Center for Policy Analysis and a veteran of the U.S. Army, and Lloyd M. Bentsen IV, a senior research fellow at the National Center for Policy Analysis.

The process to receive education benefits begins with an online or telephone application. After a veteran enrolls and registers for courses, university employees forward the student's documents to the Veterans Benefits Administration, which scrutinizes the information for eligibility prior to disbursing education benefits.

  • Unfortunately, the Veterans Administration (VA) does not provide veterans with adequate information about the benefits available and the application process.
  • More importantly, because veterans do not receive benefits until they actually begin courses, many find themselves without the monthly income required to qualify to rent an apartment or dorm room prior to the start of the semester.

For-profit institutions are very interested in veterans. Why?

  • The U.S. Department of Education's "90/10 rule" says that no more than 90 percent of the revenue of for-profit colleges can come from federal student aid.
  • But GI education benefits do not count toward federal aid caps, which creates an incentive for for-profit colleges to focus on recruiting veterans.
  • Less than one-third of all students at for-profit schools graduate with a degree, compared to twice as many who graduate from both private non-profits and public colleges.

Billions in federal tax dollars are going to profit-motivated educational institutions, which are 80 percent less likely to result in a degree than a non-profit and on average cost up to 400 percent more. These institutions are allowed to exceed their federal aid limitations by enrolling veterans -- creating a situation in which transitioning service members are actively recruited, but have fewer prospects for obtaining a meaningful degree. Considering the excessive tuition costs of the for-profits, and even the non-profits, veterans will find that they have a better chance at graduating from public universities, and that those choices are much more cost effective.

Source: Kyle Buckley and Lloyd M. Bentsen IV, "Veterans and Higher Education," National Center for Policy Analysis, September 2013.


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