Ashford University announced this week that it has temporarily stopped new enrollments of students who are using the GI Bill.
The action by the online for-profit university is the latest development in a long-running dispute between Ashford, the VA, and state regulators. In fact, Wikipedia shows 13 "controversies and lawsuits" between Ashford and state & federal regulators since 2006.
The VA has no real regulatory authority to decide which schools can enroll GI Bill students. They rely on State Approving Agencies (SAA), which are usually part of a state's department of education to ensure that schools operate according to regulations, are academically sound, and don't engage in underhanded business or recruiting tactics.
These SAAs then pass the information about accreditation, record-keeping, costs, and other stuff on to the VA who usually rubber-stamps the state's approval.
In the past this wasn't a problem, since most schools were non-profit state institutions. In the last 5-10 years many private schools started or expanded, fueled by the growth of online learning and the large amounts of money involved in the Post-9/11 GI Bill. In fact, the Post-9/11 GI Bill pays out nearly $12 billion annually for nearly 800,000 students.
Ashford University is a totally online university based in San Diego, it had one physical campus in Iowa which closed in 2016. Since it had a physical campus in Iowa, the Iowa SAA approved the school for GI Bill benefits to the VA. Well, after that campus closed, Iowa withdrew their approval since the school no longer did business in their state.
Why didn't Ashford just register as a school in California (where it's headquarters are) after that, and get approved by the California SAA for GI Bill benefits? Well, California is notoriously strict about approving for-profit colleges, in fact lawsuits by the California SAA were major reasons that ITT Tech and Corinthian College, once both major for-profit colleges, went out of business.
What did Ashford do? They moved to Arizona.
According to media reports, Ashford rented a small office in Phoenix, described as "roughly the size of a Chipotle restaurant," and moved some employees there. Apparently, no classes took place at that location. VA inspectors dropped by unannounced to find the place dark and empty. So the VA indicated they would press the Arizona SAA to disapprove Ashford's request for GI Bill approval.
Soon Senator Jeff Flake (R-AZ), wrote a letter to the VA saying, in part: "Please explain the VA’s apparent federal overreach into what should be state authority and purview at the expense of veterans."
The VA then reversed itself and said that veterans would once again be eligible for GI Bill benefits at Ashford. To be fair, Ashford and the VA are also involved in a court case, and rulings in the case seem to come at the same time as the events listed above.
Most Recent Action
Well, last week, the VA sent Ashford a letter saying the Phoenix location doesn't qualify as a campus and that unless things change in 60 days, no more GI Bill money for you. In a corporate filing Ashford strongly disagreed with the VA, they also said they would voluntarily stop enrolling new people using the GI Bill.
What Does This Mean To Veterans
Choose your school wisely. In the past if you were using your GI Bill to go to a school which closed before you got your degree you were out of luck.
The new "Forever GI Bill" changed this. If you went to a school that closed or lost accreditation and you didn’t get credit for the classes you took, the GI Bill that you used for those classes will be given back to you. This is effective for any school closings after January 1, 2015.
Still, doing a bit of homework before making a large time and money investment in a college is always a good thing to do.