The misunderstood red-headed step-child of the post 9/11 Veterans Education Assistance Act
Last week, President Obama unveiled the Chapter 33 post-9/11 GI Bill. The bill pays for a qualifying veteran’s tuition and fees up to the amount of the most expensive public undergraduate institution in the state in which that university is located, in addition to a generous stipend for costs of living and supplies. While the new bill has received ample publicity and enjoyed the eager anticipation of millions of veterans, a second benefit, the Yellow Ribbon Program (YRP), remains obscured and misunderstood.
Passed in the same bill that created Chapter 33, the YRP is a voluntary, dollar for dollar matching grant program between the VA and institutions of higher learning whose tuition and fees exceed Chapter 33’s benefit ceilings. The program reduces the amount of financial aid resources a university might already provide to qualifying veterans, closes the gap in costs not covered under Chapter 33, and creates an additional financial incentive for pursuing a post baccalaureate education. If implemented correctly, the YRP would mitigate the costs of attendance for the veteran and result in direct cost savings for the university.
For instance, five post-9/11 veterans attending a bachelor program at Harvard would have their entire costs of education covered by Harvard’s new financial aid program, amounting to $104,000 for the 2009-2010 academic year before application of Chapter 33. After a veteran uses Chapter 33, the costs to university controlled financial aid resources would drop to $65,247. The YRP would reduce this by half, amounting to a savings of more than $30,000/year/veteran. A few hundred thousand dollars may be small change next to a massive endowment, but it can make a huge impact in the lives of a few highly qualified, yet financially disadvantaged scholars.
Despite these benefits, the YRP suffers from skepticism and indifference from officials in the Veterans Administration (VA). A military.com article titled “Fiscal Crisis Wrinkles New GI Bill’s ‘Yellow Ribbon’” stated that few colleges and universities would be willing to sign on to the program due to the worldwide financial crisis. According to the VA’s Director of Education Service, Keith Wilson, “Most schools aren’t going to want to do a Yellow Ribbon program… because their finances have been hit too hard in the last couple of months.” Since it’s introduction, the YRP has been branded as a program that will drain scarce resources from universities and is thus destined to fail, as it requires voluntary participation.
To the contrary, such assertions of the YRP are highly inaccurate. The recession should only serve as a catalyst for the program’s adoption, rather than fuel its rejection. Few universities were eager to sign on to the program in the beginning as a result of the YRP’s poor marketing strategy. Rather than project the program as a way to support veterans and appeal to an institution’s patriotism, the program should be marketed as an opportunity for colleges to save money during a frightful recession. Like any business, institutions of higher learning seek to maximize their welfare. Accordingly, they respond to economic incentives that lower their baseline costs and increase profits. Clearly, any program would be wise to consider the forces of economics and business on which the client relies and use such forces to achieve success. Once universities understand the program’s benefits, they will waste little time adopting the YRP.
In some instances, the YRP may stimulate the creation of additional financial aid for veterans, but the extent to which the veteran will directly benefit from the YRP will depend on each institution’s implementation of the program. Despite the complexity, the YRP is a win-win situation for veterans and universities. Of course, the program is not free, and the costs are only transferred to the federal government, and ultimately, the taxpayer.
Regardless, investing in our veterans education will yield a handsome return for America in the long term, and is a small price to pay for showing our appreciation for their sacrifices. As such, the YRP is a sound investment for universities and the federal government, and should be given the recognition it deserves, rather than portrayed as a useless program before it has been properly marketed and executed.
