The new Post-9/11 GI Bill, which substantially boosted education benefits for veterans, has been a windfall for large chains of for-profit colleges, according to figures released yesterday by Senate Democrats who are arguing for tighter regulation of the sector.
Data on the first two years of the program show large numbers of veterans - and the government dollars that follow them - going to for-profit chains.
Of the $4.4 billion the Department of Veterans Affairs disbursed during the 2010-2011 academic year, $1 billion went to just eight for-profit schools.
The top seven recipients were for-profit institutions. The largest single share went to the University of Phoenix, which collected $210 million through the program, up from $77 million a year ago. GI Bill funds for each of the other eight top for-profits also more than doubled from the previous year.
The figures are relatively small in comparison to other government programs like Pell Grants. And they aren’t surprising in some respects because the large for-profit chains enroll students across the country and are far bigger than any not-for-profit institutions.
The GI Bill attracts particular scrutiny because of concerns that veterans are being aggressively recruited by institutions that generally have higher costs, default rates, and dropout rates.
For-profits enrolled roughly 25 percent of veterans using the program but received 37 percent of the GI Bill funds.
The main group representing the for-profit industry noted that those numbers indicate the sector educated slightly more service member students last year than during the first year of the program, but received the same share of total GI bill dollars.
The Association of Private Sector Colleges and Universities said veterans should be free to use the educational benefits they have earned “to select the postsecondary program that best meets their educational needs.’’
“It’s possible that 100 percent of a college’s or university’s revenue can come from the taxpayers,’’ said Senator Tom Harkin, Democrat of Iowa, who chairs the Health, Education, Labor, And Pensions Committee. “That’s not a good situation for the taxpayers.’’