Barbara McClure Analyst in Social Legislation Education and Public Welfare Division January 31, flf

Transcription

1 EPW Congressional Research Service The Library of Congress Washington, D.C VETERANS' EDUCATION ASSISTANCE PROGRAMS Barbara McClure Analyst in Social Legislation Education and Public Welfare Division January 31, 1986 flf

2 CRS-v CONTENTS ABSTRACT... iii I. INTRODUCTION... 1 II. THE THREE GI BILLS... 5 A. World War II... 5 B. Korean Conflict C. Post-Korea and Vietnam Era III. POST-VIETNAM ERA VETERANS' EDUCATIONAL ASSISTANCE PROGRAM (VEAP) IV. ALL-VOLUNTEER FORCE EDUCATIONAL ASSISTANCE PROGRAM... 35

3 ABSTRACT Education assistance for veterans was first provided for World War II veterans with enactment of the Servicemen's Readjustment Act of 1944, more popularly known as the GI Bill. The Veterans Administration (VA) currently administers three separate veterans' education assistance programs: (1) the Post-Korea/Vietnam Era GI Bill, (2) the Post-Vietnam Era Veterans' Educational Assistance Program (VEAP), and (3) the All-Volunteer Force Educational Assistance Program. This report describes the development and operation of the various veterans' education programs since enactment of the original GI Bill.

4 VETERANS' EDUCATION ASSISTANCE PROGRAMS I. INTRODUCTION Prior to World War II there were no education assistance benefits for veterans. From the time of the Revolutionary War through World War I, vet erans' benefits consisted mainly of compensation for the service-connected disabled and pension benefits for needy war veterans. Following World War I, medical care, low-cost life insurance, and vocational rehabilitation for the service-disabled were added. Education assistance was one element of a whole new system of benefits known as "readjustment benefits" created for World War II veterans by a series of laws enacted between 1940 and The purpose of the new readjustment benefits was to help veterans, even those who were not disabled or poor, to make a successful transition back to civilian life, and to make up for educational, business or other opportunities lost while in service. \J The first major readjustment benefit, a provision of the Selective Service Act of 1940 (P.L ), entitled veterans to reinstatement in their former jobs after discharge from the military. P.L , enacted February 3, 1944, * provided lump sum mustering-out pay upon discharge for World War II veterans. The Veterans' Preference Act of 1944 (P.L ) gave veterans hiring pref erence for Federal civil service employment. The most comprehensive of the \J Congress and the Nation Washington, Congressional Quarterly Service, p

5 CRS-2 readjustment benefits laws was the Servicemen's Readjustment Act of 1944 (P.L ), popularly known as the "GI Bill of Rights." The GI Bill contained four major benefits for World War II veterans: (1) education and job training at Government expense; (2) guaranteed loans for the purchase of homes, farms or businesses; (3) readjustment allowances for the unemployed; and (4) special job-placement services from the U.S Employment Service. The World War II readjustment benefits were so popular, and were considered so successful, that they were extended also to Korean Conflict and Vietnam Era veterans, and in some instances, to peacetime veterans. Education and training assistance has constituted the largest single readjustment benefit for veterans both in terras of amount of money spent and in number of veterans participating. 2J Since 1944, more than $55 billion has been spent on GI Bill education and training benefits for more than 18 million World War II, Korean Conflict, Post-Korea and Vietnam Era veterans. Following the official termination of the Vietnam Era, Congress terminated eligibility for GI Bill education and training benefits for persons entering military service after December 31, / Persons who entered the military before that date have 10 years after discharge or until December 31, 1989, whichever is earlier, to use their benefits. To replace the GI Bill program, which was financed entirely by the Government, Congress established a program called the Post-Vietnam Era Veterans' Educational Assistance Program (VEAP), which requires servicemembers who choose to participate to make contributions to an education assistance fund. When a participant elects to use VEAP benefits, the Government matches the contribution 2J Levitan, Sar and Karen A. Cleary. Old Wars Remain Unfinished. Baltimore, Johns Hopkins University Press, p / Act of Oct. 15, 1976; P.L ; 90 Stat

6 CRS-3 at the rate of $2 for every $1 contributed by the participant. When VEAP was enacted, it was generally thought that a contributory program was more appropriate for an all-volunteer force than one totally funded by the Government. Dissatisfaction with VEAP, however, soon led to calls for enactment of a new peacetime GI Bill. Enrollment in VEAP was lower than had been anticipated and the disenrollment rate was high. VEAP also was criticized as ineffective as a recruiting device because the services were having difficulty meeting recruiting goals in the late 1970s. Opponents of a new GI Bill argued that the more generous GI Bill benefits were not neccessary for an all-volunteer force where there is no forced interruption of career or education; that the cost of a new GI Bill program would be too great; and that recruitment had greatly improved by the 1980s. In 1984 Congress enacted a new education assistance program, effective for those entering the military after July 1, 1985, which achieved a compromise between proponents and opponents of a new GI Bill. The All-Volunteer Force Educational Assistance Program, enacted as Title VII of the Department of Defense Authorization Act of 1985 (P.L ), is a 3-year test program that, like VEAP, requires contributions from participating servicemembers, but pays a higher return than VEAP ($8 for every $1 contributed for those who serve 3 years; $6.50 for every $1 contributed for those who serve 2 years). No new enlistee enrollments will be accepted in VEAP for the duration of the new program. This paper describes in greater detail the development and operation of the various veterans' education assistance programs. 4/ 4/ Not included is a discussion of the vocational rehabilitation and counseling program, which provides special education and training benefits to service-connected disabled veterans.

7 CRS-5 II. THE THREE GI BILLS A. World War II 5/ From the early days of World War II it was generally recognized that considerable planning would be required for the postwar return to civilian life of some 16 million U.S. servicemembers. By January of 1942, only a month following the Japanese attack on Pearl Harbor, the National Resources Planning Board had been designated to coordinate planning for an orderly demobilization. Because of experiences following World War I, when veterans had returned to a postwar depression with no special employment or education assistance available to them, there also was a consensus that some major program of readjustment assistance for returning servicemembers would be needed. When President Roosevelt signed the Selective Service Act of 1942 (P.L ), which lowered the draft age from 20 to 18 years, he also announced the formation of a committee to study the education and training needs of returning servicemen. The Armed Forces Committee on Postwar Educational Opportunities for Service Personnel, chaired by Major General Frederick H. Osborn and generally referred to as the Osborn Committee, issued its report in July The Committee recommended that 1 year of education and training benefits (i.e., tuition, fees and subsistence allowances) should be made available to 5/ Much of the information on the background of the World War II and Korean Conflict GI Bills was taken from: U.S. President's Commission on Veterans' Pensions. Veterans' Benefits in the United States. Washington, U.S. Govt. Print. Off., Three vols.

8 CRS-6 all World War II veterans in order to "meet a national need growing out of the aggregate educational shortages which are being created by the war." 6/ Legislation based on the Osborn Committee's recommendations was introduced in November By the time the legislation was enacted in June 1944, however, a much b'roader program of education assistance than that proposed by the Osborn Committee had evolved. In addition, other readjustment benefits, i.e., those providing employment assistance, unemployment allowances, and housing and business loans, had been included to form an omnibus package of benefits called the Servicemens 1 Readjustment Act or, as it was popularly known, the "GI Bill of Rights" (P.L ). The purposes behind enactment of the education provisions of the GI Bill were threefold: (1) to avoid high levels of veteran unemployment such as followed World War I; (2) to help eliminate educational shortages that might develop as a result of the war's interruption of the education of millions of young servicemembers; and (3) to assist individual veterans in their readjustment to civilian life. As enacted, the original GI Bill made education benefits in the form of tuition, fees and subsistence allowances available to all World War II veterans (a) who had served a minimum of 90 days active duty between the period September 16, 1940, and the end of the war, (b) who were discharged other than dishonorably, and (c) whose education was "impeded, delayed, interrupted or interfered with" by military service, or who desired a refresher or retraining course. Persons who entered the service before the age of 25 were presumed to have had their educations interrupted or impeded. Eligible veterans were 6/ Quoted in U.S. President's Commission on Veterans' Pensions. Veterans' Benefits in the United States. Vol. Ill (Staff Report No. IX-B, Readjustment Benefits: Education and Training, and Employment and Unemployment, p. 2).

9 CRS-7 entitled to benefits for a period of 1 year plus, for veterans' whose educa tion had been impeded or interfered with, an additional period equal to the veteran's length of service, not to exceed a total of 4 years of assistance. A veteran had to commence training no later than 2 years after discharge from the service or after the end of the war, whichever was later. The program was to expire 7 years after termination of the war. Tuition and fees were» paid by the VA directly to the education or training institution where a veter an was enrolled, up to a maximum of $500 per academic year. In addition, a monthly subsistence allowance of $50 for full-time training was provided for single veterans and $75 for those with dependents. Lesser amounts were paid for part time students. In the years following enactment of the original 61 Bill, actual experi ence with the new education program led to enactment of a number of amendments. In general, these amendments were directed at clarifying the law, simplifying administration of the program, liberalizing benefits to attract more veterans and more effectively meet their needs, and curbing abuses of the program. The first amendments, enacted in 1945 (P.L ), liberalized several features of the program. Among the major provisions of P.L were the following: 1. Removed the restriction limiting benefits beyond the first year to those whose education had been impaired, delayed, interrupted, or interfered with, thus opening the full program to all veterans; 2. Increased subsistence allowances to $65 per month for a veteran without dependents and $90 per month for a veteran with dependents; 3. Extended the period for initiating use of benefits from 2 to 4 years following discharge, and extended the termination date of the program from 7 to 9 years following the war;

10 CRS-8 4. Permitted payment of tuition and fees in excess of the $500 annual limit, with a corresponding reduction in the veteran's period of entitlement; 5. Specifically authorized payment of benefits for correspondence courses but without payment of the subsistence allowance. Amendments enacted in 1946 (P.L ) were intended to curb abuses by on-job training programs. For example, it was discovered that a great many of these programs had developed hastily in order to take advantage of GI Bill money and that quality varied greatly among them. P.L , therefore, established specific standards for on-job training programs and made them sub ject to State education approving agencies. (P.L , enacted in 1947, set forth specific standards for on-farm training programs.) To prevent execu tives and other high-salaried employees from "training" under the program, P.L limited a veteran's combined monthly income from the GI Bill sub sistence allowance and earnings from oil-job training to $175 per month for those without dependents and $200 per month for those with dependents. These amounts were raised in 1948 (P.L ) to $210 per month for veterans with out dependents, $270 per month for veterans with one dependent, and $290 per month for veterans with two or more dependents. P.L , enacted in 1948, raised subsistence allowances to $75 per month for a single veteran, $105 per month for a veteran with one dependent, and $120 per month for a veteran with two or more dependents. v Another abuse of GI Bill assistance that came to light use of benefits by veterans to take avocational or recreational courses led to legislation prohibiting use of benefits for such purposes. The ban was originally con tained in the supplemental independent agencies appropriations legislation for 1949 (P.L ) and was repeated in appropriations legislation for 1950 (P.L ). It was enacted permanently by P.L (July 13, 1950).

11 CRS-9 P.L also contained provisions aimed at checking certain abuses by "a profusion of shoddy vocational schools set up specifically to rake in VA money." 7/ Specifically, the law (1) authorized the VA to disapprove payment of benefits for training in for-profit vocational schools that had been in existence for less than 1 year; (2) prescribed stricter criteria for approval of for-profit schools with fewer than 25 students or one-fourth of the students enrolled (whichever was larger) paying their own tuition; (3) provided that no new courses could be approved in for-profit schools where the State approving agency determined that the occupation for which the course was intended to provide training was crowded in the State and that existing training facilities were adequate; and (A) set minimum attendance requirements for veterans pursuing trade or technical courses below college level. During the early 1950s, several studies of the World War II GI Bill program were conducted. These included a February 1950 joint report by the VA and the Bureau of the Budget, two reports issued in January 1951 and February 1952 by a House Select Committee to Investigate the Educational and Training Program Under the GI Bill (called the Teague Committee after its chairman, Representative Olin Teague), and a survey by the General Accounting Office (GAO) of the education and training operations of the VA in seven States, the results of which were issued in July These reports, in general, praised the success of the GI Bill program, but offered specific criticisms of and suggestions for improving it. In particular, all were critical of abuses by profit-making vocational schools, many of which were described as "fly-by-night" ventures founded only to take advantage of Government funds. 8/ The criticisms and TJ Starr, Paul. The Discarded Army. New York, Charterhouse, 1973, p / Ibid., p

12 CRS-10 suggestions offered by these reports greatly influenced the education and training benefits provided for Korean Conflict veterans. The World War II GI Bill program terminated on July 25, During its existence, some 7.8 million World War II veterans (about 50 percent of those eligible) took advantage of the education and training opportunities it provided. Of these, more than 2.2 million attended colleges and universities and nearly 3.5 million attended schools below college level; 1.4 million were on-job trainees, and 690,000 were on-farm trainees (see table 3, p. CRS-24). Total cost of the program was $14.5 billion. B. Korean Conflict The U.S. Armed Forces were called into action in Korea on June 27, 1950, and Congress immediately began to consider extension of GI Bill benefits to Korean Conflict veterans. The content of the "Korean GI Bill" (P.L , enacted July 16, 1952), and its similarities to and differences from the World War II program, were to a great extent determined by the Nation's economic con dition, by the various studies of the World War II program that had been con ducted, and by the "weight of precedent." According to the Bradley Commission (the President's Commission on Veterans' Pensions which studied veterans' bene fits and reported in 1956): The total "package" of benefits for the new group of veterans was inevitably compared with what had been done for the men who served in World War II, and the content of [the Korean GI Bill] was partly determined by a desire to give the new group of veterans the same benefits that had been given to an earlier group. 9/ 9/ U.S. President's Commission on Veterans' Pensions. Veterans' Benefits in the United States. Vol. Ill (Staff Report No. IX-A, Readjustment Benefits: General Survey and Appraisal, p. 149).

13 CRS-11 The economic situation during the Korean Conflict was quite different from that during World War II. Employment was high, there were fewer servicemembers and demobilization was gradual. There was little fear of postwar depression or high unemployment. As a result, the Korean GI Bill was developed with primary emphasis on the readjustment intent of the program rather than its economic consequences. 10/ The various studies which were conducted of the World War II program also were important in the development of the Korean Conflict program. Particular attention was given to the recommendations of the Teague Committee (the Select Committee to Investigate the Educational Program Under the GI Bill which had been established by a resolution of the House of Representatives in August 1950). Abuses of the World War II program, especially among for-profit vocational schools, which had been pointed out by several studies, led to the retention of many of the restrictions adopted as amendments to the original World War II program and to the inclusion of even stricter safeguards under the Korean Conflict program. For example, the ban on use of benefits for avocational or recreational courses was continued. Detailed standards were written into the law for the approval or disapproval of courses, especially for those below college level and for on-job and on-farra training programs. No nonaccredited course below college level in a for-profit school could be approved if more than 85 percent of the students were veterans. Veterans had to identify a particular educational, professional, or vocational goal and enroll in courses consistent with that goal. Only one change in a veteran's goal was permitted. Perhaps the greatest change under the Korean Conflict program was that direct tuition payments to educational institutions were eliminated, and 10/ Ibid.

14 CRS-12 instead the VA made lump sum monthly payments to veterans to cover the costs of tuition and other educational expenses and living expenses. This change was recommended by the Teague Committee because it viewed direct tuition payments as one of the primary incentives for abuses by education and training institutions, ll/ Considerations of cost also influenced the development of the Korean GI Bill. According to the Bradley Commission, there was a general belief in Congress that the Government could not afford to continue spending as much on veterans' education benefits as it had following World War II. The benefits provided under P.L , therefore, were intended to cover only a portion of a veteran's education expenses. In addition to considerations of cost, it was believed also that if veterans were responsible for paying a portion of the cost of their own education that this, in combination with the payment of benefits directly to veterans, would give veterans more incentive to be sure that the money was spent for worthwhile programs. P.L provided education and training benefits to veterans with military service on or after June 27, 1950, and before January 31, / Eligible veterans were entitled to benefits for a period equal to one and one-half times the duration of their active duty service, up to a maximum of 36 months. A veteran had to commence education or training within 2 years following discharge from the service (later extended to 3 years by P.L ), and to complete training by 7 years following discharge (extended to 8 years by P.L ). A veteran with no dependents enrolled fulltime in an education or training institution was entitled to a direct payment from the VA of $110 per month to be used for tuition, books, fees and living ll/ Starr, Paul. The Discarded Army, p / The January 31, 1955, termination date for eligibility was established by Executive order in January 1955.

15 CRS-13 expenses. The monthly allowance was $135 for those with one dependent and $160 for those with more than one dependent. P.L. 84-7, enacted February 15, 1955 set a cut-off date of January 31, 1965 for all training under the Korean GI Bill. During the program's existence nearly 2.4 million veterans (about 43 percent of those eligible) received education and training benefits about 1.2 million of these attended colleges and universities; 860,000 attended vocational/technical schools; and 223,000 were on-job and 95,000 were on-farm trainees (see table 3, p. CRS-24). Total cost of the program was $4.5 billion. C. Post-Korea and Vietnam Era Beginning in the late 1950s, numerous pieces of legislation were introduced to extend GI Bill benefits to post-korea, or "Cold War," veterans. In 1959, and again in 1965, the Senate passed measures that would have established a Cold War GI Bill. Both the Eisenhower and the Johnson Administrations opposed enactment of such legislation, arguing that GI Bill benefits should be reserved for war veterans and that they would be too costly and were unnecessary in light of existing education and training programs available to the general public. The Department of Defense opposed the legislation on the ground that it would encourage experienced military personnel to leave the military in order to take advantage of education benefits. Proponents argued that a Cold War GI Bill should be enacted because, unlike previous peacetime periods, compulsory military service remained in effect, and because of the U.S. worldwide military commitments, servicemerabers were subject to being called in to handle various crisis situations such as those that had occurred in Cuba, the Dominican Republic, Lebanon, Berlin and Southeast Asia.

16 CRS-14 In 1966, as fighting escalated in Vietnam and support for veterans' programs increased, the Johnson Administration reversed its position, and a new GI Bill was enacted for post-korea and Vietnam Era veterans (P.L ). The new law provided education and training benefits for servicetnembers with more than 180 days of active duty service, any part of which occurred after January 31, 1955, the date of expiration for eligibility for the Korean Conflict program. The new program was generally patterned after the Korean Conflict program, although in some regards benefits under the new program were less generous, reflecting a congressional intent to provide "considerably less liberal treatment" to non-war veterans. 13/ For example, the 90-day active duty service requirement under the World War II and Korean Conflict programs was increased to "more than 180 days" under the post-korea program. The system adopted under the Korean Conflict program of paying subsistence allowances directly to veterans with no separate tuition payment was continued. 14/ Benefit amounts, however, were slightly lower than those paid to Korean Conflict veterans $100 per month for a single veteran as compared to $110 (benefit amounts for the post-korea program were subsequently increased in 1967 and several times thereafter). Under the law as originally enacted, eligible veterans were entitled to one month of education and training for each month of service, up to a maximum of 13/ U.S. Congress. Senate. Committee on Labor and Public Welfare. Cold War Veterans' Readjustment Assistance Act; report to accompany S. 9. Senate Report No , 89th Cong., 1st Sess. Washington, U.S. Govt. Print. Off., p / Attempts were made on several occasions to restore separate tuition payments or to provide tuition subsidies because it was argued that veterans who lived in States with fewer public schools and higher tuition costs were being penalized. These attempts were unsuccessful, however, largely because of concerns about fraud that had been associated with a separate tuition system, and because of a general feeling that all veterans should be paid equal benefits.

17 CRS months. In 1968, the period of entitlement was increased to one and onehalf months of benefits for every month of service, with those serving 18 months or more being entitled to the full 36 months of benefits (the same formula that had applied to the Korean Conflict program). 15/ In 1976 the maximum entitlement was extended to 45 months. 16/ Under the original law, veterans had 8 years following discharge to use their GI Bill benefits; in 1974 this was extended to 10 years. 17/ The initial legislation did not provide benefits for on-job training, cooperative farm training, or flight training; these were added by P.L in Following the U.S. withdrawal from Southeast Asia and the official termination of the Vietnam Era, eligibility for the Post-Korea/Vietnam Era GI Bill was terminated for those entering military service after December 31, 1976, by P.L The same legislation provided that no benefits under the program will be paid after December 31, As is evident from the above discussion, the original Post-Korea and Vietnam Era GI Bill has been amended a number of times. In general these amendments were for one or more of the following purposes: (1) raising benefit levels; (2) expanding the scope of benefits or liberalizing eligibility requirements; or (3) attempting to curb abuses or reduce costs. The following is a brief discussion of these various developments. 1. Benefit Levels As already mentioned, benefit levels under the Post-Korea GI Bill as originally enacted were lower than those under the Korean Conflict GI Bill 157 P.L / P.L / P.L

18 CRS-16 despite 14 years of inflation. Some objection to this was raised at the time the legislation was enacted, and the following year legislation was passed providing a 30 percent increase in benefits from $100 a month for a single veteran to $130 per month. In the early years following enactment of the Post-Korea GI Bill, participation rates were low compared with the two previous GI Bills. These low participation rates were in part attributed to low benefit levels. 18/ As a result, several additional benefit rate increases have been enacted, the first ones because of concerns over the adequacy of benefits, and later to keep benefit levels in line with rising education and living costs. The following shows the GI Bill benefit increases that have been enacted. TABLE 1. Chronology of Post-Korea/Vietnam Era GI Bill Benefit Rates Public law Monthly benefit* Percent increase Effective date $ _, /1/66 10/1/67 2/1/70 10/1/72 9/1/74 10/1/75 10/1/77 1/1/81 10/1/84 *For a single veteran taking full-time institutional training For a complete list of current GI Bill rates see table 2 (p. CRS-23). 18/ U.S. Congress. Senate. Committee on Labor and Public Welfare. Veterans Education and Training Assistance Amendments Act of 1969; report to accompany H.R Senate Report No st Cong., 1st Sess. Washington, U.S. Govt. Print. Off., p. 16.

19 CRS Expansion or Liberalization of Benefits The original Post-Korea/Vietnam Era GI Bill was criticized as being less generous than the programs for World War II and Korean Conflict veterans not only because of lower benefit rates, but also because of a more limited scope of benefits and more restrictive eligibility requirements. Over the years, Congress has on several occasions expanded benefits and liberalized eligibility criteria for the Post-Korea/Vietnam Era program. The purpose of these liberalizations has been not only to equalize benefits with the previous programs, but in some instances, to provide even greater benefits in order to make up for deficiencies of the original program and to improve the.effectiveness of the program. One way in particular in which Congress has expanded the scope of benefits under the Post-Korea/Vietnam Era program has been to provide special benefits targeted to the educationally disadvantaged. Some of the major amendments expanding benefits under the Post-Korea/Vietnam Era GI Bill are the following: (1) P.L added benefits for apprenticeship, on-job and cooperative farm training, and for flight training with a vocational objective, and- provided that veterans could take high school level training and receive the full subsistence allowance with no reduction in their entitlement; (2) P.L expanded the formula for determining an individual's maximum period of entitlement from one month for each month of active duty service to one and one-half months for each month of active duty service; (3) P.L authorized payment of $50 per month for up to 9 months of individual tutorial assistance, established a Predischarge Education Program (PREP) under which servicemembers could receive remedial education and training during their last year of military service in order to prepare for regular

20 CRS-18 training under the GI Bill, 19/ and established an outreach program within the VA aimed especially at providing assistance to the educationally disadvantaged; (4) P.L authorized the VA to pay up to two months' education benefits in advance to veterans enrolled in authorized programs and established a workstudy program under which GI Bill trainees performing various services for the VA could receive advance work-study allowances; (5) P.L extended the date by which a veteran must use GI Bill benefits (i.e., the "delimiting date") from 8 to 10 years following discharge; (6) P.L established an education loan fund under which a veteran could borrow up to $600 per year for education expenses, extended the maximum number of months of eligibility for benefits from 36 to 45 for those attending undergraduate school, and expanded the tutorial assistance program; (7) P.L extended the maximum period of eligibility for benefits from 36 to 45 months for veterans in all types of training, not just those attending undergraduate school, and increased the maximum education loan from $600 to $1500; (8) P.L increased the amount of the maximum education loan to $2500 and provided that veterans who were fulltime students when their 10-year delimiting period expired could receive loans for another 2 years, authorized waiving the 10-year delimiting period in cases where a veteran was prevented from beginning or completing an education program because of physical or mental disability, and authorized the accelerated payment of benefits to veterans attending higher cost institutions under some circumstances; (9) P.L authorized the VA to provide educational assistance through December 31, 1983, to Vietnam Era veterans whose 10-year delimiting date had expired but who had remaining GI Bill entitlement, if the extended eligibility were used for a program of apprenticeship or other on-job training, 19/ P.L terminated the PREP program under the GI Bill effective October 30, 1976, and P.L terminated the program for VEAP participants.

21 CRS-19 a program with a vocational objective, or a program of secondary education, and if the VA determined that the veteran was in need of such a program to achieve a suitable occupational or vocational objective (i.e., a "targeted delimiting date" extension); and (10) P.L extended for one year until December 31, 1984, the time during which a veteran could use the targeted delimiting date extension. 3. Curbing Abuses and Reducing Costs As under the World War II and Korean Conflict programs, Congress continued to be concerned about abuses under the Post-Korea/Vietnam Era GI Bill. Various actions were taken to eliminate or minimize the incidence of such abuses. For example, increasing veteran enrollments but low completipn rates for correspondence courses led to enactment of provisions in P.L prescribing disclosure and refund requirements for correspondence schools in order for their courses to be approved for GI Bill benefits. P.L prohibited the payment of benefits for courses which use "significant avocational or recreational themes" in their advertising, and required that for courses with a vocational objective to be approved it had to be demonstrated that at least 50 percent of the persons completing the course over the preceding two years had been employed in the occupational category for which the course was intended to provide training. 20/ P.L authorized the VA to suspend payment of GI Bill benefits for any course where there is a "substantial pattern" of ineligible trainees receiving assistance because course approval requirements have not been met or the institution offering the course has violated recordkeeping requirements. 20/ This provision was repealed by P.L because it was determined to no longer be necessary in order to prevent abuses.

22 CRS-20 In recent sessions of Congress, concerns over the increasing size of the Federal budget deficit have led to enactment of legislation aimed at reducing Federal spending. Certain cost saving changes have been enacted for the GI Bill program. P.L reduced the share of tuition costs paid by the VA for flight training from 90 percent to 60 percent and for correspondence courses from 90 percent to 70 percent. The Administration had proposed to eliminate these benefits because in its view these courses had not provided substantial employment for those trained and were primarily used for recreational or avocational purposes. P.L , the Omnibus Budget Reconciliation Act of 1981, did terminate GI Bill benefits for flight training for new enrollees effective October 1, 1981, and further reduced the rate of payment for correspondence courses from 70 to 55 percent. P.L also terminated the education loan program with two exceptions: Vietnam Era veterans (1) who are continuing full-time training in the first 2 years following expiration of their GI Bill entitlement or (2) who were already pursuing flight training courses when flight training benefits were eliminated. On June 30, 1973, the authority of the President of the United States to draft men into the Armed Forces expired (with certain exceptions). On May 7, 1975, President Ford issued a proclamation terminating the Vietnam Era for purposes of eligibility for wartime veterans' benefits. At the same time he called upon Congress to terminate eligibility for Post-Korea/Vietnara Era GI Bill benefits in order to "make an equitable distinction between those who serve in time of war and those who serve in time of peace." 21/ P.L , 2JY U.S. President, (Ford). Eligibility Period for Wartime Veterans Benefits: Statement by the President Concerning the Termination Date of the Period, May 7, Weekly Compilation of Presidential Documents, v. 11, May 12, p. 498.

23 CRS-21 signed into law on October 15, 1976, set December 31, 1976, as the termination date for accrual of eligibility for GI Bill benefits, and set December 31, 1989, as the date after which no benefits will be paid under the program. GI Bill benefits were terminated because they were seen as unneccessary and inappropriate for an all-volunteer peacetime Armed Forces by the Administration, many members of Congress and many veterans' organizations. Recent debate has centered on the issue of whether time limitations for use of GI Bill benefits should be extended or eliminated. Vario.us legislation has been introduced which would (1) extend or eliminate the 10 year delimiting date period or (2) extend or eliminate the December 31, 1989, termination date for the program. Advocates of extending the eligibility periods for GI Bill benefits argue, in general, that: (1) many Vietnam Era veterans who suffered initial readjustment problems, or who felt unwelcome on campuses following the war, now may be ready to take advantage of the GI Bill; (2) because of relatively high unemployment, especially among younger Vietnam Era veterans, there is a special need now for education and training assistance; (3) those who remained in the military after the Vietnam Era will be penalized because they will not have a full 10 years following discharge to use their benefits; and (4) the military will suffer the loss of experienced personnel who will have to leave the military in order to take advantage of GI Bill benefits before the program is terminated. Opponents of extending GI Bill eligibility periods argue, in general, that: (1) extending the delimiting period beyond 10 years is not consistent with the readjustment intent of the program; (2) the 10-year delimiting period for Vietnam Era veterans already is longer than that for veterans of World War II (9 years) and the Korean Conflict (8 years); (3) the cost would be

24 CRS-22 too great; and (4) approximately 66 percent of eligible veterans have received training under the Post-Korea/Vietnam Era GI Bill, which is greater than under the previous programs (50 percent for the World War II program and 43 percent for the Korean Conflict program). In fiscal year 1984 approximately 528,000 persons received GI Bill educa tion benefits. Total VA expenditures for the program that year were about $1.1 billion. The number of trainees and expenditures for the Post-Korea/Vietnam Era GI Bill have been steadily declining since the peak year of 1976 as more and more veterans complete their training, exhaust their eligibility for benefits, or pass their delimiting date (see table 4, p. CRS-25). As of the end of fiscal year 1984, approximately eight million veterans and service personnel (about 66 percent of those eligible) had received edu cation or training under the Post-Korea/Vietnam Era GI Bill. Of these, about 4.9 million attended colleges and universities; about 2.5 million attended vocational/technical schools; and about 593,000 were on-job and 56,000 were on-farm trainees (see table 3, p. CRS-24). Total cost of the program as of the end of FY 1984 was approximately $38.1 billion.

25 CRS-23 TABLE 2. Post-Korea/Vietnam Era GI Bill Benefit Rates (Effective October 1, 1984) No One Two Each additional Type of program dependents dependent dependents dependent Institutional: full-time $376 $448 $510 $32 three-quarter time half-time Cooperative a/ Apprenticeship/ on- j ob t raining : 1st 6 mos. 2nd 6 mos. 3rd 6 mos. 4th 6 mos. and thereafter Farm cooperative: full-time three-quarter time half-time ' a/ A program combining formalized education with training in a business or industrial establishment with emphasis on the institutional portion. Source: Veterans Administration. Federal Benefits for Veterans and Dependents. Washington, U.S. Govt. Print. Off., p

26 CRS-24 TABLE 3. GI Bill Participation Rates (as of September 30, 1984) Post-Korea World War II Korean conflict Peacetime Vietnam post-korea a/ era b/ Veteran population Total trained Percent 15,440,000 7,800, ,509,000 2,391, ,037,000 1,395, ,189,000 6,644,495 c/ 72.3 School trainees Percent 5,710, ,073, ,311, ,079, College Percent 2,230, ,213, , ,171, Other schools Percent On-job trainees Percent Farm trainees Percent 3,480, ,400, , , , , , , , ,908, , , a/ Service after January 31, 1955, but no service after August 4, b/ Service between August 5, 1964, and December 31, c/ Includes 654,461 who last used training while in service. Source: Veterans Administration. Veterans Benefits Under Current Educational Programs, Fiscal Year Washington, p. 28.

27 CRS-25 TABLE 4. GI Bill: Persons in Training and Expenditures Fiscal Years Fiscal year Persons in training Expenditures (in millions of $) Transition quarter , , ,013 1,210,731 1,584,866 1,864,158 2,125,595 2,358,608 2,691,566 2,821,514 1,320,947 1,937,874 1,521,840 1,278,538 1,106, , , , ,468 $ , , , , , , , , , , , , , ,147.8 Source: Veterans Administration. Veterans Benefits Under Current Educational Programs, Fiscal Year Washington, p , 27.

28 CRS-27 III. POST-VIETNAM ERA VETERANS' EDUCATIONAL ASSISTANCE PROGRAM (VEAP) 22? Despite the fact that Congress terminated the GI Bill, Congress still saw value in a veterans' education assistance program both as a recruitment incentive for the Armed Forces and as a positive contribution to the nation's education in general. P.L , therefore, not only terminated the GI Bill but also established a new Post-Vietnam Era Veterans' Educational Assistance Program (referred to as VEAP) for those entering the military on or after January 1, VEAP is less generous than the GI Bill in that it requires service-members to make contributions to an education fund in order to be eligible for education assistance. When an individual uses the benefits, the contributions are matched by the Government at the rate of $2 for every $1 contributed. A contributory program was generally considered to be more appropriate for ah all-volunteer force than one totally funded by the Government. To qualify for VEAP benefits a veteran or servicemember must have (1) entered active military service on or after January 1, 1977, and before July 1, /; (2) served for a continuous period of 181 days or more or have been discharged because of a service-connected disability; (3) been discharged or 22/ Much of the information on the VEAP program was taken from U.S. Library of Congress. Congressional Research Service. The Post-Vietnam Era Veterans' Educational Assistance Program (VEAP). Report No EPW, by Economics Division, Education and Public Welfare Division, and Foreign Affairs and National Defense Division. Washington, p / The program is suspended for new enrollees during the period July 1, 1985, through June 30, 1988, during the test period for the new education program enacted by P.L (see following section).

29 CRS-28 released from service under conditions other than dishonorable (or if continuing on active duty, must have completed his or her first obligated period of service or 6 years of active duty, whichever is less); (4) served in the U.S. Armed Forces, U.S. Coast Guard, U.S. Public Health Service or the National Oceanic and Atmospheric Administration; and (5) contributed to the program while on active duty. Servicemembers who have elected to participate in VEAP may have from $25 to $100 deducted monthly from their pay, or may make a lump sum contribution, to the education assistance fund. The maximum amount that may be contributed is $2,700. For each dollar contributed.by the participant, the Government contributes $2, up to a maximum of $5,400. Individuals who contribute.the full $2,700, therefore, have a total of $8,100 available for their education and training. In addition, the Secretary of Defense may also make -special con tributions (known as "kickers") on behalf of some participants for recruitment or retention purposes. The Army, which is the only branch of service to have made significant use of kickers, offered a maximum kicker of $12,000. Participants receive monthly benefits for the same number of months they contributed to the VEAP fund, or for 36 months, whichever is less (a $100 contribution may be made for 27 months with the participant eligible for 36 months of benefits). The amount of the monthly benefit payment is determined by divid ing the number of months benefits will be paid into the participant's total education fund. Full-time students who have contributed the maximum $2,700, for example, receive 36 months of benefits at $225 per month. Payments for less than full-time schooling are proportionately less and are extended over longer periods of time. The following table shows VEAP benefit amounts for various contribution levels.

30 CRS-29 TABLE 5. VEAP Benefits for Full-Tirae Students For Selected Contribution Amounts Contributions by servicemember aj Regular VEAP benefit With $12,000 "kicker" Monthly Total Monthly Total Monthly Total $ $ 900 1,800 2,700 2,700 $ $2,700 5,400 8,100 8,100 $ $14,000 17,400 20,100 20,100 a/ Contributions for 36 months except for the $100 contribution which is for 27 months. Participants have up to 10 years following discharge from military service in which to use their VEAP benefits. Benefits may be paid for VA approved courses in elementary or secondary schools, vocational or technical schools, correspondence schools, 24/ junior colleges, business schools, professional schools, and colleges and universities. Benefits are not provided for apprenticeship or on-job training courses. If a participant chooses to disenroll from VEAP, the amount of the individual's contribution is refunded without interest or matching funds. Refunds of individual contributions, without interest or matching funds, also are made to participants who do not use the full amount of their benefits. As of September 30, 1984, a total of 754,064 servicemembers had made VEAP contributions since the program's inception (see table 6). Of these, 364,323 (about 48 percent) had disenrolled. 24/ Benefits for correspondence courses are paid at the rate of 55 percent of tuition charges.

31 CRS-30 TABLE 6. Contributors Since Inception of VEAP By Branch of Service (as of September 30, 1984) Branch of.service Number of contributors Army 424,062 Navy 154,731 Air Force 47,013 Marines 118,571 Coast Guard 8,131 Public Health Service 1,485 National Oceanic and Atmospheric Administration 71 TOTAL 754,064 Source: Veterans Administration. Veterans Benefits Under Current Educational Programs, Fiscal Year Washington, p. 34. A total of 38,310 persons were receiving VEAP benefits for education and training during fiscal year TABLE 7. Persons in Training Under VEAP, Fiscal Year 1984 Type of training Persons in training College level 34,600 Graduate 2,299 Undergraduate 18,457 Junior College 13,844 Vocational/Technical 3,696 Elementary/Secondary 14 TOTAL 38,310 Source: Veterans Administration. Veterans Benefits Under Current Educational Programs, Fiscal Year Washington, p. 33.

32 CRS-31 In fiscal year 1984, obligations for VEAP totaled $151,610,000. Of this amount $52,494,000 was for benefits and $99,116,000 was for disenrollments. The program was funded by the VA through 1981 and has been funded by the Department of Defense since 1982 (although the VA still administers the program). Since its inception, VEAP has been criticized on a number of grounds. Enrollment in the program was lower than anticipated (only about 28 percent of those eligible as of 1982) and disenrollments were greater than expected (nearly 50 percent of contributors). During the late 1970s and early 1980s, the military services were having difficulties meeting recruiting goals and VEAP was criticized as ineffective as a recruiting device. It was also seen as unsuccessful in attracting better qualified personnel. These dissatisfactions with VEAP led to proposals for a new peacetime GI Bill. Opponents of a new GI Bill argued that previous GI Bills were enacted in times when there was a military draft and that this form of recompense for service is not appropriate for an all-volunteer peacetime military where there is no forced interruption of career or education. They also pointed out that recruitment during the 1980s had greatly improved so that the services were no longer having difficulties in meeting their recruiting goals. In light of this fact, they contended that a new GI Bill program would be too expensive and unjustified considering the size of the Federal budget deficit. It was also suggested that more generous education benefits in the long run might prove harmful to the military in that they might encourage trained personnel to leave the military in order to take advantage of the benefits. Advocates of a new GI Bill countered that although recruiting had improved, this improvement was only temporary in that it resulted from high rates of civilian unemployment. They predicted that when the economy improved the military would again experience recruiting difficulties. They also contended that