Tweaks to GI Bill Move Ahead

December 15, 2010

WASHINGTON -- Proposed reforms to the Post-9/11 GI Bill will necessarily reduce benefits for some veterans, but supporters of the changes say that’s a necessary price to pay in order to ensure new provisions are approved in the waning days of the Congressional session.

A key change in the U.S. Senate bill, which passed the Senate Monday and moves on to the House for consideration, creates a new national baseline on benefits for veterans attending all colleges -- public, private and for-profit. While the current law derives its maximum payout from the highest in-state public tuition in a given state, the new legislation would cap annual payouts at $17,500. Any expenses above that threshold could be covered by the Yellow Ribbon Program, which allows participating private colleges to enter into dollar-for-dollar matching agreements with the U.S. Department of Veterans Affairs.

By creating a national benefit baseline, supporters say they will create equity in a program that currently provides differing awards to veterans depending on which state they choose for college. At the same time, veterans who have benefited from attending colleges in states with high public tuition will see a reduction in payouts from the program.

“There are, in some cases, student veterans who will lose money because of this law change. We know that,” said Brian Hawthorne, a spokesman for Student Veterans for America, which lobbied aggressively on the bill’s behalf.

Hawthorne expects payouts to actually increase in 40 to 45 states, adding that a benefit of the legislation is that it will “level the playing field” for all veterans.

While Congress is scrambling to wrap up business at the end of the year, Hawthorne said he expects the legislation could be passed in the House as early as today.

The American Council on Education Tuesday applauded some of the benefit expansions embodied in the Post-9/11 Veterans Educational Assistance Improvements Act of 2010, but expressed concerns about some key elements. In a letter to the House of Representatives, ACE was critical of the absence of a “hold harmless” provision, which would have prevented veterans currently enrolled in the program from losing benefits under the new national baseline.

The changes proposed to the Post-9/11 GI Bill aren't the first to provoke controversy in the program, which has drawn critics since its inception. Delays in the processing of payments for veterans caused a furor, and Sen. Tom Harkin, Democrat of Iowa, recently questioned whether the program disproportionately rewards some of the very for-profit colleges under fire from Harkin's Senate committee for what he characterizes as widespread unscrupulous practices.

The reform legislation could be boosted by a report from the Congressional Budget Office (CBO), which found this month that the Senate bill would actually reduce the cost of the program by $734 million in 2020. At the same time, Hawthorne lamented that the legislation couldn’t get closer to presenting revenue neutral changes to the program, rather than cutting money out of it.

There are several reasons for the reduction in the cost of the program, including a provision that would tie monthly living allowances to veterans’ course loads. The current legislation affords the same allowance to veterans taking half time -- more than six credits -- and above.

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