Latest Skirmish over For-Profit Colleges Involves DOD

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The battle over government money for for-profit colleges moved into the Defense Department today as a Senate subcommittee heard how little the department does to track the educations of service members who attend online classes with tuition assistance from the military.

Sen. Tom Carper (D-Del.) convened the meeting of the Senate Subcommittee on Federal Financial Management, Government Information, Federal Services and International Security, to address the quickly growing payments for on duty service members to take voluntary higher education courses, most of which is not being tracked in any way for the Defense Department.

The hearing was held in conjunction with the release of a report by the Government Accountability Office, requested by Carper, that uncovered Defense’s lack of attempts to determine whether service members are receiving instruction that Carper described as helping them to “leave the door with an education to … improve their lives.”

Although the GAO report, DOD Education Benefits: Increased Oversight of Tuition Assistance Program Is Needed, makes scant mention of for-profit colleges, a colloquy between Casper and Sen. Tom Harkin (D-Iowa), chairman of the Senate Health, Education, Labor and Pensions Committee that has been investigating for-profit schools, made it clear that many of the online courses being discussed as unsuitable were being offered by for-profit colleges, eager for billions in government funding. Carper said, “let’s focus on the for-profit schools” since they are becoming the first choice of many military men and women.

The GAO report notes that payments for tuition assistance have more than tripled in less than a decade, from $157 million in 2000 to $517 million in 2009. But the tracking system that DOD has had in place dealt only with colleges and universities that provide instruction on-base, and not at all with online providers.  According to Harkin, who made a statement before the committee, that means nearly $360 million in payments for online programs had no scrutiny at all.

Under the tuition assistance program, servicemembers can be reimbursed up to $250 per credit hour for a maximum of $4,500 each year.  But with many online courses costing about $350 a credit hour, servicemembers are also having to dig into their own pockets – often with the help of federal financial aid – to cover the difference. Harkin noted that there is a 25 percent default rate among for-profit college students, two to three times that of  public and nonprofit school students.

Robert Gordon, deputy assistant secretary of Defense for military community and family policy, testified that the department plans to have a new tracking system in place by October that will encompass online education, but noted that there would be nearly a year gap between the end of the last tracking system contract and a new one.

Though Carper pressed for some type of oversight system in the interim, Gordon suggested that was not possible because the department is just now addressing how to measure what constitutes a quality education program.

George Scott, GAO’s director of education, workforce and security issues, testified that his agency also found that there was little interaction between the departments of Education and Defense and among Defense and various accrediting agencies about schools that were being investigated for improprieties or for possible accreditation loss. The study also found that DOD had no central method of tracking complaints – about such matters as transferability of credit and acceptance of bachelor’s degrees at graduate institutions – made about any of the schools that servicemembers are enrolled in.

DOD’s Gordon testified that a new hotline for complaints has been put into place, but so far only about 10 complaints have been logged.  Carper suggested that the complaints should also be made to on-based counselors, rather than just through an online website.

Harkin told the subcommittee that the for-profit colleges are aggressively going after military members as a way to make up the 10 percent of their income that must come from non Education department sources as a condition of their participation in federal student aid programs.  Neither military tuition assistance nor GI benefit payments are counted in the maximum of 90 percent of funding that must come from non Education sources.

Sen. Scott Brown (R-Mass.), ranking Republican on the subcommittee, questioned Gordon about why so many students don’t complete their courses through the military programs. “Do we get reimbursed?” Brown asked.

DOD’s Gordon said that military personnel enrolled in more than 800,000 courses last year and about 45,000 military members attained some type of degree or diploma.

Brown said he was concerned about those who didn’t complete their programs, whose likelihood of finding a good job to help support their families was not improved.

“A lof of it with me is about the accounting part, are we getting the best for our dollars?” Brown said.