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August 02, 2013 1:30 PM How For-profit Colleges Target Veterans

By Daniel Luzer

Many veterans’ organizations are concerned that for-profit colleges are targeting service members and veterans and delivering them a sub-par education. What better way to reward veterans for their service than to screw them over, right? This problem came up again at a hearing of the Senate Homeland Security and Governmental Affairs Committee earlier this week.

There is, I’ve pointed out before, vast federal money for education and training available through veterans. This is a huge cash cow for proprietary colleges. Some 600,000 veterans spent around $9 billion in federal money last year for education.

According to a piece by Charles Dervarics at Diverse Issues in Higher Education:

For-profit colleges and the quality of their educations returned to Capitol Hill this summer as veterans’ advocates protested some colleges’ predatory practices and sought congressional action to help active-duty and retired military.
“Many veterans have been subjected to highly questionable recruitment practices, deceptive marketing, and substandard education instruction in some of the schools they attend, particularly for-profit schools,” said Holly Petraeus, assistant director of the U.S. Consumer Financial Protection Bureau’s office of service member affairs.

How bad are these recruiting practices? Well Patraeus said that in one case a Department of Veterans Affairs official told her she found veterans with serious brain injuries enrolled in for-profit colleges. And they “didn’t even remember” signing up for classes. But the for-profits still collected the cash.

According to the article, proprietary colleges get almost 40 percent of post-9/11 GI Bill education benefits. They take in half of all other Department of Defense tuition assistance money.

For-profits argue that it’s not the scammy recruiting that attracts veterans but, rather, that

Veterans are choosing these schools because of their customer service and flexibility.
“Our military and veteran students are not the fresh out-of-high-school, first-time, full-time student living on campus and attending college thanks to the generosity of family,” said Steve Gunderson, president of the Association of Private Sector Colleges and Universities (APSCU). Instead, they “are like many of our new traditional students—working, with a spouse and children and paying for their education with money they have saved.”

This is probably more or less true. Online, for-profit colleges do look pretty attractive, for logistical reasons, for veterans who are adults with families and other responsibilities.

But that promised convenience isn’t so useful if students never complete the program. The enrollment of brain damaged veterans is probably a rather extreme example of how for-profit colleges work with veterans. The more common problem, however, is that the programs don’t seem to be very good.

No one knows precisely what the completion rates for veterans attending for-profit colleges with federal money actually are, but some 80 percent of schools receiving the most Post-9/11 GI Bill money have completion rates as low as 30 percent. “Customer service and flexibility” don’t matter much if people ever don’t graduate.

The structural reason veterans and enlisted military are attractive to for-profit colleges is that under the Department of Education’s 90-10 rule, a propriety college can derive no more than 90 percent of its money from federal financial aid. Because Defense Department education and training money doesn’t count as federal money, however, more veterans enrolled make it easier for for-profits to stay under the 90 percent regulation.

Daniel Luzer is the news editor at Governing Magazine and former web editor of the Washington Monthly. Find him on Twitter: @Daniel_Luzer

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