Following the Collapse of ITT Tech, Senator Carper Releases New Staff Report Highlighting the Harm to Student Veterans Caused by School Closures

WASHINGTON – Compared to federal student loan borrowers, our nation’s veterans using the Post-9/11 GI Bill have substantially fewer protections when their schools suddenly close, according to a staff report released today by Senator Tom Carper (D-Del.), top Democrat on the Senate Homeland Security and Governmental Affairs Committee. The new report, “Education Denied: The Importance of Assisting Veterans Harmed by School Closures,” highlights the significant and disproportionately negative impact that school closures, like the recent collapse of ITT Technical Institutes (ITT Tech) and Corinthian Colleges (Corinthian), have on veterans using the GI Bill. The report recommends steps that Congress and the Department of Veterans Affairs (VA) should take to ensure that comprehensive relief is available to veterans and their families when schools abruptly close so that they do not lose their benefits for good. The report also recommends a temporary extension of the housing allowance to ensure veterans and their families can pay their rent or mortgage while they seek to transfer to another institution of higher learning.

“Our nation’s veterans have earned their G.I. bill benefits and they deserve to attain a high-quality education. It is unfathomable to me that these brave men and women, who volunteered to serve their country in a time of war, are now being left in the lurch by some of the largest recipients of Post-9/11 GI Bill taxpayer dollars,” said Sen. Carper, a 23-year veteran of the Navy and Naval Reserves, who has fought tirelessly on behalf of student veterans. “This is shameful. We have an obligation to honor their sacrifice and ensure our veterans are afforded the same protections that federal student loan borrowers are given when their schools suddenly close. This report puts forth several recommendations that would provide student veterans and their families the comprehensive relief they deserve and ensure they are able to pursue their dream of a college education. VA and Congress also need to do more on the front end to hold bad actors accountable and ensure that we’re not continuing to send our veterans to schools delivering poor outcomes and destined for financial collapse.”

Combined, ITT Tech and Corinthian have received over $1 billion from taxpayers through the Post-9/11 GI Bill since 2009. Since fiscal year 2013, nearly 9,000 veterans – including over 6,800 at ITT Tech– were actively pursuing their education at schools that shut their doors. While the Department of Education has discharged federal student loans for over 11,000 borrowers who attended Corinthian and has already begun taking steps to provide similar relief to students who attended ITT Tech, there are no comparable protections for student veterans utilizing Post-9/11 GI Bill benefits. Currently, the Secretary of Veterans Affairs does not have the authority to restore Post-9/11 GI Bill educational benefits or provide any extension of housing allowance benefits when schools permanently close.

The report recommends that both Congress and the Department of Veterans Affairs take the following actions to assist veterans harmed by school closures:

Restore Benefits for Veterans Harmed by School Closures

o   Congress must provide the Secretary of Veterans Affairs with the authority to restore benefits for Post-9/11 GI Bill students who attend schools that close permanently.

o   Congress must provide the Secretary of Veterans Affairs with the authority to continue making housing payments for a limited time period to veterans and their families following school closures.

o   Congress should consider allowing the Secretary of Veterans Affairs to require schools that pose certain financial risks to set aside funds that could be used to reduce the cost to taxpayers of restoring benefits to the veterans harmed when schools close.

Strengthen Oversight of Schools Receiving Post-9/11 GI Bill Funds

o   The Department of Veterans Affairs should consider ways to enhance its use of existing authorities to ensure schools comply with Post-9/11 GI Bill program requirements.

o   The Department of Veterans Affairs should draw on the full range of information it collects to identify schools engaged in prohibited practices and use its authority disapprove new student enrollments or withdraw program approvals when these practices occur.

o   Congress should consider increasing funding for State Approving Agencies, which operate under contract with VA and are the primary entities charged with approval of a school’s participation in the Post-9/11 GI Bill program.

Senator Carper wrote to Department of Veterans Affairs Secretary Bob McDonald to convey the report’s findings and stress the important of protecting veterans from school closures. You can read the full report here: “Education Denied: The Importance of Assisting Veterans Harmed By School Closures.”