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Maryland Closes 90-10 Loophole

March 19, 2020
 
 

Maryland became the first state in the nation to close the so-called 90-10 loophole, which, according to critics, has led for-profit colleges to target service members.

Under the federal rule, for-profit institutions are required to get at least 10 percent of their revenue from sources other than federal student aid. But education benefits from the Departments of Defense and Veterans Affairs count toward the 10 percent minimum requirement, making those receiving the military benefits a target.

But under a measure passed by the Maryland House of Delegates Monday, military benefits would count toward the 90 percent federal funding maximum. It would also begin barring for-profits that receive more than 90 percent of their revenue from federal funds, including military benefits, from enrolling Maryland residents.

The measure passed the Maryland Senate in February and will now go to Republican governor Larry Hogan. A Hogan spokesman said only that the governor will consider signing the bill when it comes to him.

“This groundbreaking legislation makes Maryland the first in the nation to stand up for veterans and stop predatory schools from cheating them out of their hard-earned GI Bill,” said Ramond Curtis, state policy manager for Veterans Education Success. “Veterans had targets on our backs when we served in uniform; we shouldn’t have to come home and have targets on our backs again from predatory schools.”

The group has pushed for a similar law in Oregon and wants Congress to count military benefits as federal funding.

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