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More than 5,300 student vets at Ashford U. could lose GI Bill benefits

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By ALEX HORTON | STARS AND STRIPES Published: June 10, 2016

SAN ANTONIO — More than 5,300 student veterans and their beneficiaries enrolled in online courses at Ashford University could be cut off from their GI Bill benefits next month, according to the Department of Veterans Affairs.

The potential interruption of education benefits — including tuition, books and a living stipend — will go into effect for students entering any term after June 30 if the school’s parent company, Bridgepoint Education, is denied or delayed approval from the California State Approving Agency for Veterans Education by that date.

VA looks to state agencies to approve higher education programs to receive access to GI Bill tuition payments. Iowa’s Department of Education pulled their certification for Ashford after the university announced it would shutter its brick and mortar university in Clinton, Iowa, according to filings with the Securities and Exchange Commission. Ashford recently shifted their headquarters to San Diego, where Bridgepoint is based.

The vast majority of Ashford’s students using the GI Bill attend online classes, according to VA’s school comparison website. Another group of about 5,000 student veterans and beneficiaries are not currently enrolled but took classes on or after Aug. 1, 2015, according to a VA spokesman. Those students could also be affected if they choose to enroll in future classes.

Seeking approval in California could prove challenging, as the company was subpoenaed by the California Attorney General’s Office in 2013 following investigations into their financial aid and enrollment practices. The state investigation is ongoing, according to a spokeswoman for the attorney general there.

Attorneys general in Kentucky, New York and North Carolina, along with the federal Consumer Finance Protection Bureau, have launched similar probes to investigate possible violations of consumer protection laws at Bridgepoint, according to SEC filings.

The Post 9/11 GI Bill pays tuition, fees and provides living and book stipends to veterans and dependents attending universities or trade schools. The payments are calculated based on time spent in active-duty service.

According to VA’s GI Bill’s resource page, a veteran with 100 percent eligibility enrolled at Ashford receives a $1,111 monthly housing stipend and $1,000 per year for books, with tuition covered at $21,085 per year.

If certification in California does not occur, the change will force veterans and dependents to pay tuition out of pocket while losing their living and book stipends. Students would need to relocate to another accredited school to receive their education benefits.

Ashford is a for-profit institution – part of an industry raked by President Barack Obama’s administration, which seeks tighter regulations.

Last year, the Obama administration began enforcing rules requiring universities to track job performance of graduates – one indicator of how much value the degree brings in the workforce. The for-profit school industry accounts for 13 percent of all higher education students but half of all loan defaults, according to a 2014 Department of Education release.

A 2012 investigation by Sen. Tom Harkin, D-Iowa, concluded GI Bill tuition dollars are especially lucrative to for-profit schools. Institutions must not receive more than 90 percent of their funding from federal coffers, but VA and Defense Department funds for the GI Bill do not count against it. The industry has collected $8.2 billion in funds since the Post-9/11 GI Bill became law in 2009, according to an analysis by the Los Angeles Times.

Industry officials have long countered they provide non-traditional access for non-traditional students such as veterans and military dependents.

Student Veterans of America, an advocacy group, has deployed an outreach team to relay information and resources to potentially affected students at Ashford University. The team will field questions from Ashford students and provide guidance on alternative schools that might individually suit them if the California approval agency declines GI Bill certification.

While SVA will stop short of telling veterans at Ashford to avoid for-profit schools in the future, the group is prepared to make recommendations on the type of institution that veterans should attend.

“We will steer veterans to schools that provide better value, and in most cases that means public, private nonprofit and community colleges,” said James Schmeling, the group’s executive vice president of strategic engagement.

Officials at Ashford University did not respond to calls seeking comment. However, the university took to Facebook on Monday to address their students' concerns.

“First and foremost, our goal is to ensure that students using VA education benefits experience no disruption in their educational benefits,” one post said.

Ashford’s military landing page does not provide an alert or information for prospective or current students about the potential interruption of benefits to thousands of veterans and dependents. Instead, the page gives prominent space to draw in veteran applicants: several icons boast the university’s place on military friendly university lists.

Those ranking came within the last year – when Ashford’s parent company settled a $15-million lawsuit after its own shareholders alleged the company oversold the likelihood of accreditation in California. In 2014, the company settled a $7.5-million lawsuit launched by the Iowa Attorney General following allegations of deceptive recruitment strategies, charging excessive fees and deploying high pressure sales tactics.

The Department of Education’s College Scorecard shows attending Ashford costs more than the annual national average, while its graduation rate dips far below the national average. By comparison, the University of Iowa’s annual costs are about one-third less and the graduation rate is far above average.

Ashford has drawn fire for its recruitment of servicemembers and veterans. In 2009, Bloomberg reported its recruiters canvassed for troops heading to medical retirement, including a Marine with a traumatic brain injury who could not recall what classes he had chosen.

horton.alex@stripes.com
Twitter: @AlexHortonTX