Some of the schools that receive the most Post-9/11 GI Bill money spend the least on teaching students, a new report suggests.
The study, conducted by the nonprofit group Veterans Education Success, analyzed more than 4,600 higher-education institutions and found that in 2017, 427 of those schools spent less than 30 percent of their gross tuition dollars on instruction, according to VES. That’s about $980 million in GI Bill money that went toward costs other than directly educating student veterans, VES estimates.
“Is it appropriate for colleges to charge taxpayers for GI Bill funds but then divert those funds away from veterans’ actual education?” asked VES President Carrie Wofford during a Capitol Hill briefing on the report Thursday. “And does Congress owe it to veterans and taxpayers to more carefully guard veterans’ earned benefits?"
The three schools receiving the most GI Bill money nationwide from fiscal year 2009 through fiscal year 2017 – University of Phoenix, DeVry University and Strayer University, all of which are for-profit schools – spent only 15.3 percent, 12.4 percent and 10.9 percent respectively of their overall revenue on instruction in 2017.
But some schools are pushing back on the report, saying that its definition of “instruction” doesn’t make sense for the online schools many veterans attend. A spokeswoman for Strayer parent company Strategic Education Inc. told Rebootcamp in an email that, as a mostly online school, Strayer must make significant IT investments that aren’t counted as “instruction” spending.
In addition, spokeswoman Elaine Kincel said that other schools’ “instruction” numbers are inflated based on academic research.
“As Strayer University is not a research institution, it reports only direct instructional expenses,” Kincel said.
The VES study defines “instruction” in line with the Education Department’s Integrated Postsecondary Education Data System Outcome Measures Survey, including funds for academic and training essentials like providing classes and professors.
It notably does not include investments in academic support or student services in that definition.
The study used data from the Education Department’s IPEDS Outcome Measures Survey, the 2016-17 IPEDS Finance Survey, the College Scorecard database and VA’s records of schools’ GI Bill tuition and fee payments.
VES calculated how much of a school’s GI Bill revenue is going toward teaching and learning by dividing the total amount schools spent on instruction by the total amount they received in tuition and fees.
In addition to analyzing GI Bill revenue, the report also looked at schools’ success graduating their students within eight years of enrolling and whether those graduates were making more or less than $28,000 a year — what the average U.S. high school graduate makes — within six years of entering a college.
VES concluded that seven of the top 10 schools receiving GI Bill funds failed to graduate more than 50 percent of their students. It also found that only about 47 percent of GI Bill students at those schools were earning more than $28,000 a year within six years of starting school.
The worst schools — or the ones the VES dubbed the “bottom of the barrel” — for allocating GI Bill money for instruction were all for-profits: Colorado Technical University, American Intercontinental University and Capella University, all of which spent less than 10 percent of their gross revenue on instruction in 2017.
For context, the study noted that health insurance companies are required to spend 80 percent of patient premiums on improving the quality of patient care.
VES did point out quite a few schools that were putting a large portion of their GI Bill tuition revenue toward instruction. That group included some of the country’s most prestigious institutions, like Yale University and Stanford University, as well as schools that grant lower-level degrees, like Bismarck State College and Lakeshore Technical College.
The study also spotlighted a few for-profit schools with high completion rates and post-graduate salaries that are also using most of their GI Bill tuition money toward instruction, like Professional Golfers Career College, Fox College and Swedish Institute.
Wofford said that GI Bill benefits are designed to be not only a reward for veterans service but also an investment by the government in their future success after the military.
“There are no rules on how a college spends the money once they receive it,” she said. “And I think Congress may be surprised what many of these institutions are doing with it."
A University of Phoenix spokesman questioned the study, saying the data it focuses on “fails in many respects to represent the full fabric of the university and the academic quality of our programs.”
“University of Phoenix strongly supports a constructive, fact-based policy discussion about student outcomes,” he said. “Unfortunately, this report does not get us there.”
Military Times Deputy Editor Leo Shane III contributed to this report.
