Press Release

November 9, 2017
Cardin, Van Hollen Reintroduce Military and Veterans Education Protection Act with Groundbreaking Support from Veterans Service Organizations
Momentum builds to pass legislation that would close the 90/10 loophole and protect veterans from predatory for-profit schools

WASHINGTON—In advance of Veterans Day, U.S. Senators Ben Cardin and Chris Van Hollen (both D-Md.) joined 28 of their Democratic colleagues in reintroducing the Military and Veterans Education Protection Act, legislation that would close a loophole that allows for-profit schools to avoid having to secure at least 10 percent of their revenue from non-federal sources.

More than two decades ago, Republican President George H.W. Bush signed a bipartisan law that limited how much federal funding for-profit schools may receive from taxpayers. Now called the 90/10 rule, this limit requires for-profit schools to obtain at least 10 percent of their revenues from non-federal sources. However, a loophole in the law excludes Department of Veterans Affairs (VA) and Department of Defense (DOD) education funds, like the Post-9/11 GI Bill and Tuition Assistance (TA), from being counted as federal funds. Some for-profit schools exploit this 90/10 loophole by using aggressive recruitment practices and deceptive marketing tools to enroll service members, veterans and other GI Bill beneficiaries. The Military and Veterans Education Protection Act would close the 90/10 loophole by counting VA and DOD funds as federal dollars.

“Congress and the American people made a commitment to our veterans with the enactment of the Post-9/11 GI Bill – service for country in exchange for educational assistance for a quality education,” said Senator Cardin. “Due to a loophole in the law, a number of unscrupulous for-profit schools target our veterans to access their hard earned educational benefits without providing a quality education. The enactment of the Military and Veterans Education Protect Act will close the 90/10 loophole and prevent our service members from being preyed upon and protect taxpayer dollars from being wasted.”

“The men and women who serve in our military put their lives at risk for our nation, and they deserve our respect and support when they return home. Ensuring they get the quality education they earned and were promised is a crucial part of our obligation to them,” said Senator Chris Van Hollen. “It is shameful that so many of our veterans are taken advantage of by some for-profit universities, and we must put an end to these predatory practices. This legislation is the first step in this effort, and the Senate should consider it without delay.”

In addition to Senators Cardin and Van Hollen, Senators Tom Carper (D-Del.), Richard Durbin (D-Ill.), Richard Blumenthal (D-Conn.), Patty Murray (Wash.), Jon Tester (Mont.), Elizabeth Warren (D-Mass.), Tammy Baldwin (D-Wis.), Jack Reed (D-R.I.), Kirsten Gillibrand (D-N.Y.), Sherrod Brown (D-Ohio), Dianne Feinstein (D-Calif.), Mazie Hirono (D-Hawaii), Maggie Hassan (D-N.H.), Debbie Stabenow (D-Mich.), Jeanne Shaheen (D-N.H.), Al Franken (D-Minn.), Sheldon Whitehouse (D-R.I.), Chris Murphy (D-Conn.), Bernie Sanders (I-Vt.), Ed Markey (D-Mass.), Kamala Harris (D-Calif.), Chris Coons (D-Del.), Chuck Schumer (D-N.Y.), Bob Menendez (D-N.J.), Jeff Merkley (D-Ore.), Angus King (I-Maine), Tammy Duckworth (D-Ill.) and Catherine Cortez-Masto (D-N.M.) are cosponsors of the legislation.

Since 2009, more than 1.7 million service members, veterans and their families have used the Post-9/11 GI Bill to finance their higher education. However, over the past several years, about 40 percent of Post-9/11 G.I. Bill tuition benefits have gone to for-profit schools, even as questions continue about their graduation, default and job placement rates. Additionally, some of the largest recipients of Post-9/11 GI Bill funds have closed down after years of delivering poor outcomes to students and taxpayers. Two now-shuttered for-profit colleges, ITT Technical Institutes and Corinthian Colleges, received over $1 billion in Post-9/11 GI Bill benefits before suddenly closing their doors, leaving nearly 7,000 student veterans and every American taxpayer in the lurch. Far too many veterans and service members have exhausted their hard-earned benefits at now-defunct schools. In response, a broad coalition of Veterans Service Organizations (VSOs) and other advocacy groups are rallying behind this commonsense effort to close the 90/10 loophole to protect military and veteran students, as well as taxpayers, from bad actors in the for-profit educational sector.

“Student Veterans of America (SVA) has been committed to closing the 90/10 loophole since 2011,” said William Hubbard, VP of Government Affairs for the Student Veterans of America. “Prospective and current student veterans remain the target of predatory programs that deliver a low-quality education. We remain committed to transparency in higher education and helping student veterans become informed consumers. SVA supports closing this loophole and is pleased to be working with Congress to make that a reality.”

The American Legion passed a resolution at their 2017 National Convention in Reno, Nevada, stating, “The American Legion expresses its strong support for legislation and federal agency action to ensure better quality and student outcomes for institutions approved for use of Department of Veterans Affairs (VA) education benefits by excluding Department of Defense and VA funds from the 90/10 calculation.”

“The 90/10 loophole allows predatory schools to take advantage of the benefits survivors’ loved ones served and died for,” said Ashlynne Haycock, Manager for Education Services for the Tragedy Assistance Program for Survivors (TAPS). “Just like veterans, surviving family members have been taken advantage of by institutions of higher learning that want access to their educational benefits, only to be left with useless degrees and untransferable credits. If a school is not doing anything morally wrong, they should not object to the closure of the loophole. We must close the loophole to help ensure that surviving families and veterans have access to the highest quality education. These families have already sacrificed so much for this country, they should never be taken advantage of, and should be given every opportunity to pursue their dreams.”

“In recent research by VES on the 90/10 loophole, we found that revenue has increased by 60% from military education benefits indicating high reliance on the GI Bill and Tuition Assistance benefits to stay in business,” said Tanya Ang, Director of Policy and Outreach for Veterans Education Success. “This is concerning, at best, and something must be done to ensure service members, veterans, and their family members are protected from the predatory practices of fraudulent institutions.”

“The 90/10 loophole has created a reality that unjustly wastes the money of American taxpayers and deprives veterans of the education benefits they have earned,” said Iraq and Afghanistan Veterans of America (IAVA) Legislative Director Tom Porter. “While closing the loophole is not the only solution, it is a significant step Congress should take to improve education outcomes for veterans. Education is the best tool veterans have to transition to civilian life and develop the skills to find a new career. IAVA is committed to ensuring that every veteran can take advantage of their full earned benefits. That means refusing to allow predatory for-profit colleges from targeting GI Bill benefits and failing to deliver on promised quality education.”

Organizations supporting the Military and Veterans Education Protection Act include: The American Legion, Veterans of Foreign Wars, Student Veterans of America, Iraq and Afghanistan Veterans of America, Vietnam Veterans of America, Paralyzed Veterans of America, Veterans Education Success, Tragedy Assistance Program for Survivors, Military Order of the Purple Heart, Military Officers Association of America, Blue Star Families, Military Child Education Coalition, Veterans for Common Sense, Non Commissioned Officers Association, VetsFirst, VetJobs, High Ground Veterans Advocacy, AMVETS, Wounded Warrior Project, The Retired Enlisted Association, Got Your Six, National Guard Association of the United States, Association of the United States Navy, Naval Enlisted Reserve Association, Non Commissioned Officers Association, National Military Family Association, Swords to Plowshares, Air Force Association and the Air Force Sergeants Association.