Senator Tom Harkin: Eight For-Profit Colleges Receive 25% of GI Bill Benefits!

Dear Commons Community,

Eight for-profit-college companies received nearly a quarter of all the money spent on Post-9/11 GI Bill benefits in 2012-13, says a report released earlier this week by Sen. Tom Harkin and the Senate education committee’s Democratic majority. And even as the for-profit colleges’ overall enrollments fell from 2009 to 2013, the document asserts, their enrollments of veterans “dramatically increased.” As reported in The Chronicle of Higher Education:

“The top recipient was the Apollo Education Group, parent company of the University of Phoenix, which received $272-million in Post-9/11 GI Bill benefits in 2012-13, more than triple the $77-million it received in 2009-10. The Education Management Corporation was second with $163-million in 2012-13, and ITT Educational Services, with $161-million, was third. The other companies, in order of the value of benefits received, were the DeVry Education Group, the Career Education Corporation, Corinthian Colleges Inc., Strayer Education, and Universal Technical Institute Inc.

Of the top 10 recipients of Post-9/11 GI Bill funds, the University of Maryland system was the only public institution; Embry-Riddle Aeronautical University was the only private, nonprofit institution.”

The Executive Summary of the Harkin Report is available below.



Executive Summary


Almost three years ago the HELP Committee determined that eight of the top 10 recipients of veterans’ educational benefits under the Post-9/11 GI Bill benefits were large, publicly traded companies that operate for-profit colleges. A new analysis shows that in the program’s fourth year, enrollment of veterans in for-profit colleges has again increased sharply, in tandem with a steep decline in the share of veterans’ enrolling in public institutions, even though overall student enrollment in for-profit colleges has declined. Taxpayers continue to spend twice as much on average to send a veteran to a for-profit college although HELP Committee analysis shows that up to 66 percent of the overall students who enrolled at these for-profit colleges in 2008-09 withdrew without a degree or diploma. Additionally, some companies operating for-profit colleges appear to be increasingly dependent on Post-9/11 GI Bill funds to comply with federal requirements intended to ensure that these companies do not become overly reliant on federal education resources.


•For-profit colleges received $1.7 billion in Post-9/11 GI Bill benefits during the 2012-13 academic year –almost as much as the total cost of the program just four years earlier.

•Eight of the top 10 recipients of Post-9/11 GI Bill benefits are large, publicly-traded companies that operate for-profit colleges. These eight companies have received $2.9 billion in taxpayer dollars to enroll veterans in their for-profit colleges over the past four years, including 23 percent of all Post-9/11 GI Bill benefits ($975million) in 2012-13.

•Amongst the top recipients of Post-9/11 GI Bill benefits is Corinthian Colleges, Inc. Corinthian received $186 million in Post-9/11 GI Bill funds from 2009 to 2013, yet recently announced it was in such severe financial distress that it would close or sell all campuses. In all, seven of the eight companies are currently under investigation by state attorneys general or federal agencies for deceptive and misleading recruiting or other possible violations of federal law.

•While the total number of veterans attending all colleges on the Post-9/11 GI Bill grew rapidly between 2009-10 and 2012-13, both the number of veterans attending for-profit colleges and the amount of benefits these colleges received increased more than in other sectors of higher education.

•The percentage of veterans attending a public college has declined precipitously, from 62 percent in 2009 to just 50 percent in 2013. During the same period, the percentage of veterans enrolling in for-profit colleges increased from 23 to 31percent of total enrollees.

•Although overall student enrollment has decreased at each of the eight top for-profit GI Bill beneficiaries, their enrollment of veterans has dramatically increased during the same period.

•Taxpayers are paying twice as much on average to send a veteran to a for-profit college for a year compared to the cost at a public college or university ($7,972 versus $3,914).

•The federal government does not currently track how veterans are performing at different types of colleges. However, overall student outcomes provided by the companies to the HELP Committee for students enrolling between 2008 and 2009 give ample reason for concern. At the for-profit colleges currently receiving the most benefits, up to 66 percent of students withdrew without a degree or diploma.

•Between 39 and 57 percent of the programs offered by four of the companies receiving the most Post-9/11 GI Bill benefits would fail to meet the proposed gainful employment rule, suggesting that the students who attend these institutions do not earn enough to pay back the debt they take

•Some large companies that operate for-profit colleges appear to be taking advantage of a loophole to use Post-9/11 GI Bill funds to comply with the federal requirement that no more than 90 percent of revenues come from federal student aid.




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