Higher Education

Over the past decade, average college tuition and fees increased between 20 and 38 percent, depending on the type of institution. This rising cost of college affects all students--both veteran and nonveteran students--who rely on a mix of family resources, grants, scholarships, loans, and work-study to finance their education. Students may face particular hardships when the cost of attendance outpaces students' available resources. For example, some lenders recently have tightened the eligibility criteria for obtaining student loans in response to problems in financial markets. In fiscal year 2007, the Department of Education (Education) provided $82 billion in financial aid in the form of grants, loans, and work-study programs under Title IV of the Higher Education Act of 1965, as amended, to 11 million students and their families. The primary Title IV aid programs include Pell Grants, Stafford Loans, and campus-based aid programs. Veterans also may be eligible for federal financial aid from the Department of Veterans Affairs (VA). VA awarded about $2 billion in Chapter 30 education benefits under the Montgomery GI Bill1 (Chapter 30 GI benefits) to more than 300,000 veteran students in fiscal year 2007. In 2002, we reported that veteran students were awarded similar amounts of Title IV aid as nonveteran students, and veterans' total federal aid was greater when Chapter 30 GI benefits were included. Congress asked about whether this has changed, resulting in veterans receiving less federal financial aid. To address this question, Congress asked us to determine (1) how the amount of Title IV financial aid awarded to veteran students compares with that awarded to nonveteran students, (2) how higher education institutions allocate Title IV financial aid among veteran and nonveteran students, and (3) how federal agencies and higher education institutions provide information to veterans on Title IV financial aid.

Overall, veteran students received similar amounts of Title IV aid as nonveteran, independent students. However, when including Chapter 30 GI benefits, veterans received more total federal aid than nonveterans. Laws and regulations largely dictate how higher education institutions allocate Title IV aid among veteran and nonveteran students, but five of the eight schools we interviewed used their limited flexibility to allow veterans to be eligible for larger amounts of certain types of Title IV aid. While federal agencies and schools provide the same information on Title IV aid to all students, some of the schools we interviewed in areas with nearby military bases reach out to veteran students. In addition, there are some recent federal efforts to inform veterans about Title IV aid, such as workshops on federal aid for personnel separating from the military.