Has The Post-9/11 GI Bill Seen Its First Cut?

Veterans Benefits
Rep. Jeff Miller, R-Fla., arrives at the Capitol for a vote on Friday, July 11, 2014.
AP Photo by Bill Clark/CQ Roll Call

Jamie Hanway had already served more than 20 years in the U.S. Army by the time the Post-9/11 GI Bill went into effect in 2009, but it couldn’t have come at a better time. Just as Hanway and his wife were beginning to plan for retirement, their three daughters were starting to prepare for college.

Money was tight.

“We really pushed them to get good grades and get the scholarships,” he told Task & Purpose. “I hate to say it, but my financial advisor a few years back had advised us to not save as much as we were for our kids’ college education so we could plan and prepare for our retirement, because college is so dang expensive our retirement would have suffered.”

Hanway currently serves as a chief warrant officer 3 overseeing automotive maintenance in the Nebraska National Guard, where he also works full-time as a civilian contractor doing a similar job. Still, like most Americans, Hanway and his wife weren’t pulling in enough income to put three children through college.

Fortunately, Hanway, who was activated to deploy to Iraq between 2003-2005, had accrued 36 months of the Post-9/11 GI Bill. Having served more than 10 years, he had also surpassed the minimum time requirement for transferring the bill to his dependents. So he decided to give each of his three daughters 12 months, beginning with his eldest, who began her freshman year at Hastings College in the Fall of 2015.

Yearly tuition for an undergraduate student at Hastings, a private liberal arts college in southern Nebraska, is about $26,000. Add that to yearly room and board, which is about $9,000, and the total cost amounts to nearly $10,000 more than what the Post-9/11 GI Bill covers for a year in the Hastings area code, where the housing allowance is $800 a month.   

“The GI Bill helps, and it helps a lot,” Hanway said, “but she still has to work to help cover the remainder of the expenses. After this year, she’s going to have to work more hours or find another job that pays better.”

Hanway’s daughter is one of nearly 100,000 children of current or former service members who attended college on the Post-9/11 GI Bill in 2015, according to data provided by the Department of Veterans Affairs. Her ability to do so owes largely to the efforts of organizations like Iraq and Afghanistan Veterans of America, an advocacy group that helped shepherd in the bill in 2008, which included a provision allowing eligible service members to transfer the benefit to their spouses and dependents.

“We’re understandably very, very proud of it,” Tom Porter, IAVA’s legislative director, told Task & Purpose of the GI Bill. “It’s been absolutely transformative for military families.”

Now, just a few years after it went into effect, Porter and his colleagues fear the Post-9/11 GI Bill is under siege.

In February 2016, despite strong opposition from IAVA, the House Veterans’ Affairs Committee successfully pushed the Veterans Employment, Education, and Healthcare Improvement Act through the House. The bill, HR 3016, includes a provision that would cut the monthly housing stipend for the dependents of eligible service members attending school on the Post-9/11 GI Bill in half. The reduction would not impact children who are already using the benefit, or those who are transferred the benefit within 180 days of the bill becoming law

The cuts “were necessary to offset, or pay for, other aspects of the bill,” a committee spokesman told the Military Times. 

Related: How To Transfer Your GI Bill To Your Spouse Or Kids »

“It’s a slippery slope,” Porter said. “Once you start cutting into the Post-9/11 GI Bill, once you break this piggy bank open, it’s going to be harder and harder to put it back together again. It’s such a significant benefit. They’re going to keep coming back for it.”

According to numbers provided by the Department of Veterans Affairs, the spending estimate for the Post-9/11 GI Bill for FY2016 is just over $12 billion (about 14% of the overall FY2016 VA spending estimate of $167 billion). If, as in 2015, 100,000 children of veterans attend college on the Post-9/11 GI Bill this year, the VA would save approximately $78.3 million in FY2016 if the monthly housing allowance for dependents were cut in half. That’s roughly .64% of the Post-9/11 GI Bill spending estimate and less than .05% of the VA’s overall budget.

In an emailed statement to Task & Purpose, Republican Rep. Jeff Miller of Florida, the chairman of the House Committee Veterans’ Affairs who announced his retirement in March, argued that the money saved from the cuts would be put to better use elsewhere.

“We made a decision that taxpayer dollars would be better invested in expanding benefits for widows and children of deceased troops as well as veterans’ newborn babies than what in many cases are payments that go thousands of dollars above and beyond what the housing stipend was designed to cover,” he wrote.

In the same email, a House Veterans Affairs’ Committee staffer further explained the logic behind the proposed legislation.

“It’s important to note that the Post-9/11 GI bill housing stipend was designed to cover housing costs – not provide thousands of dollars in extra income per year. But when it comes to post-9/11 GI Bill beneficiaries who are children of service members, in many cases the stipend is doing the latter. HR 3016 adjusts the housing stipend for this group to align the benefit more closely with actual housing costs for the average, single college-age adult.”

The staffer also referred to a 2015 report by the Military Compensation and Retirement Modernization Commission, which recommended that the housing stipend be cut entirely for both the children and spouses of eligible service members. The report appears to have served as the primary basis for the House Veterans Affairs’ Committee’s assertion that the Post-9/11 GI Bill housing stipend for dependents was too generous.

“[According] to the commission, a student receiving this benefit and attending New School University in 2013-2014, which reportedly had the highest room and board costs in the country, would have received more than $13,000 above the actual cost of room and board,” the staffer wrote.

According to the New School website, the cheapest on-campus housing for the 2013-2014 school year was a triple/quad room in the 20th Street Residence in lower Manhattan, where cost per school year (nine months) was $14,500 plus a mandatory $600 meal plan. In 2013, the Post-9/11 GI Bill housing allowance for lower Manhattan was $3,258 per month for every month the student was in school. In 2014, the monthly stipend was $3,744. That means a dependent would have received roughly $31,752 from the VA for room and board had he or she attended the New School full time as an undergraduate during the 2013-2014 school year. Subtract $15,100 from $31,752 and you arrive at the “thousands of dollars in extra income per year” Miller referred to in his email.

But what if the student in question didn’t live in on-campus housing, as many don’t? In New York City the average monthly rent for a one-bedroom apartment was $2,995 in 2014, according to real estate site Zumper. Now, multiply $2,995 by nine months and what do you get? $26,955. That’s $4,797 less than the $31,752 a dependent would receive for room and board from the VA if he or she was attending the New School — and that $26,955 doesn’t cover other living essentials, like food and subway cards.

We must also consider the fact that the Post-9/11 GI Bill’s tuition cap for private schools in New York is just under $22,000 per year — the exact tuition cost for the New School per semester. If the student is awarded the Yellow Ribbon scholarship, the remaining balance on the annual tuition is almost covered. If not, each school year will put the student about $22,000 deeper into debt.  

The point of all this is to demonstrate that Miller’s claim that dependents are making “thousands of dollars in extra income per year” off the Post-9/11 GI Bill is, to some extent, misleading, even given their own example of the New School in New York City, which is hardly analogous to the average college experience. For people like Hanway’s daughter, who is attending a private college in Nebraska, the proposed legislation would cut her housing allowance to just $400 a month. 

Still, one could argue, as Miller does, that the taxpayer money being spent on monthly housing stipends for dependents could be better spent on veterans elsewhere. But that argument seems to overlook the fact that in a situation where a dependent isn’t able to afford full college tuition, room, and board, the financial burden is simply being transferred from the taxpayer back to the veteran, whom, of course, the GI Bill was created to help in the first place.

“Some people will say, ‘Oh, this doesn’t impact the service member or the spouse,’ said Porter of IAVA. “But if you ask me, does the education of my child affect me and my wife? It absolutely does. Although it affects the dollars that go to the child, it affects the entire military family.”

According to numbers provided by IAVA, nearly a million spouses and dependents have used the Post-9/11 GI Bill since 2010. And despite the multibillion dollar price tag, most Americans would probably agree that’s a good thing. After all, that money was earned by people who served our country honorably during a time of war, oftentimes at the expense of pursuing higher education themselves.

Of course, there’s also a bigger benefit to society as a whole. When IAVA pushed for the provision that made it possible for service members to transfer benefits, it did so knowing that for many potential and currently serving military personnel, the GI Bill has a powerful appeal.

“People join the military for different reasons,” Porter said. “Some to be a patriot. Some to travel. But many join because, hey, this is my way to get an education, or, hey, this is a way to get an education for my child or spouse.”

Right now, a service member is given the option of transferring his or her Post-9/11 GI Bill to a spouse or dependent upon reaching their six year mark, at which point they must extend for an additional four years. Porter said he fears that if the value of that benefit is reduced, as it will be if HR 3016 is successfully pushed through the Senate, fewer service members will opt to make careers of the military at that crucial six year juncture when many are debating whether to stay in or get out.

But as our military footprint overseas continues to dwindle, is Congress beginning to reform and reduce the GI Bill as a ‘wartime’ benefit?

“We still have service members in Iraq and Afghanistan right now,” Porter said. “And they’re going to be there for the foreseeable future. We have to be able to keep our promises to them, and not let up, even as those wars end up in the rearview mirror for some people.”

UPDATE: The housing cut would not impact children who are already using the benefit, or who are transferred the benefits within 180 days of the bill becoming law. An earlier version of this article did not clearly state this. (3/18/16; 5:20 pm)

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