U.S. Senator Dick Durbin (D-IL) and U.S. Representative Steve Cohen (D-TN) on Tuesday reintroduced the Protecting Our Students and Taxpayers (POST) Act. The bicameral legislation would prohibit for-profit colleges and universities from receiving more than 85 percent of their revenue from the federal government and change the calculation of federal revenue to include all federal funds, according to a press release.
The current 90/10 federal rule bars for-profit colleges from receiving more than 90 percent of their revenue from Education Department loans and grants. The other 10 percent needs to come from sources other than the federal government to ensure that schools are not overly dependent on taxpayer dollars. However, military and veterans' education benefits do not count toward that threshold despite being federal aid.
The POST Act would reinstate the original ratio of 85/15 and expand the cap on for-profit colleges' funding to include all types of federal funding, including Department of Veterans Affairs GI Bill and Department of Defense Tuition Assistance benefits.
"This loophole invites for-profit schools to funnel federal dollars to their bottom lines and exploit our veteran and service member student borrowers in the process," Sen. Durbin said in a written statement. "Representative Cohen and I are introducing this bill to reinstate the 85/15 rule which would require these predatory schools to bring in revenue from non-federal sources. Passing the POST Act can finally close a loophole that has hurt too many men and women in uniform."
"Unfortunately, far too often, these schools fail in their duty to prepare graduates for jobs that would enable them to repay these loans, leaving taxpayers to pay. Additionally, a loophole in the current law allows unscrupulous colleges and diploma mills to receive additional federal funds by targeting veterans and service members. This loophole incentivizes bad behavior that weighs down our nation's heroes with huge debts while lining the pockets of for-profit investors. This is unacceptable and cries out for reform. For-profit colleges should be accountable to both the students they are supposed to educate and the taxpayers who keep them in business," Rep. Cohen added.
AACRAO is listed in support of the POST Act.
Related Link
U.S. Senator Dick Durbin's Press Release
https://www.durbin.senate.gov/newsroom/press-releases/durbin-cohen-it-is-time-for-congress-to-close-loophole-that-encourages-for-profit-colleges-to-target-veterans-and-service-members