Blumenthal, Carper, Durbin Introduce Legislation to Protect Veteran and Military Students

Press Release

Today, U.S. Senators Richard Blumenthal (D-Conn.), Tom Carper (D-Del.), Dick Durbin (D-Ill.) introduced the Military and Veterans Education Protection Act of 2015 to close a loophole that allows for-profit schools to avoid having to secure at least 10 percent of their revenue from non-federal sources. This is the third consecutive Congress in which Sen. Carper has introduced legislation to close the 90/10 loophole. Joining him this year, along with Sens. Blumenthal and Durbin, are more than two dozen cosponsors -- the most in any year the legislation has been introduced.

Since 2009, more than one million service members, veterans, and their families have financed their higher education using the G.I. Bill, and millions more will take advantage of this benefit in the years to come. In the past five years, 40 percent of Post-9/11 G.I. Bill tuition benefits have gone to the for-profit sector, even as questions continue to be raised about these institutions' graduation, default, and job placement rates. The recent collapse of the for-profit chain Corinthian Colleges -- which received $186 million in Post-9/11 G.I. Bill dollars -- due to financial problems is another glaring reminder that Congress must remain diligent to protect active-duty military, veterans, and taxpayers.

The 90-10 rule is an important safeguard that is intended to protect taxpayers by ensuring that for-profit schools obtain at least 10 percent of their revenues from sources other than taxpayers. However, current law leaves open a loophole that allows for-profit institutions to count military and veteran educational assistance, including the generous Post-9/11 G.I. Bill, as non-federal revenues. Some bad actors in the for-profit industry are exploiting this "90-10 loophole" by aggressively recruiting veterans and G.I Bill tuition dollars, rather than obtaining 10 percent of their revenue from non-federal sources. This legislation would require GI Bill benefits that come from the Department of Veterans Affairs and military education benefits offered through the Department of Defense to count toward the 90-percent limit on the federal share of a school's revenue.

"From the collapse of Corinthian to the fraudulent behavior of ITT Tech, we have seen growing evidence of the widespread deception and reprehensible practices conducted by bad actors in the for-profit college industry -- practices that prey upon servicemembers and veterans," Sen. Blumenthal said. "Too many of these predatory, for-profit institutions continue to be propped up by taxpayer funding, including the G.I. Bill, which is allowed because of the 90-10 loophole. It is past time that we close this glaring loophole and stop for-profit schools from conducting shameful recruitment campaigns that target and take advantage of our nation's servicemembers and veterans."

Source