Change Would Make it Easier for Veterans to Stay in College and Continue their Education
Colorado U.S. Senator Michael Bennet is urging Veterans Affairs (VA) Secretary Eric Shinseki to change the VA’s policy regarding the manner in which student veterans must repay GI Bill benefit overpayments. Bennet’s proposed change would make it easier for veterans to complete their education.
Currently, there are times when veterans are paid more in GI Bill benefits than they are entitled. When students are notified that they have received a GI Bill benefit overpayment they are allotted 30 days to contact the VA to repay the entire debt, establish a repayment plan, or request a waiver. If a student fails to satisfy one of these three options, the VA begins deducting the debt amount from tuition and housing payments. The policy is the same whether the VA, the school, or the veteran is at fault for the overpayment and in some cases the VA has suspended benefit payments before before the student is notified of the debt.
In a letter to Shinseki, Bennet proposes that these reduced benefit payments should come at the end of students’ eligibility period for benefits, instead upon discovery of the overpayment. The change would ensure that the VA is able to collect the debts owed to it without unnecessarily impairing the ability of veterans to use their benefits and complete their education.
“Many veteran students are rightfully counting on the benefits they earned to support their living and education expenses and the sudden reduction in benefits puts them in an impossible financial position. This change in policy would allow veteran students the necessary time to plan for payment or find another means to support their living and educational expenses when their benefits run out,” Bennet said. “It would also provide the VA and the school the time to fix any overpayment issues they caused without interfering with the veteran student’s ability to complete his or her education.”
Bennet has held a state-wide series of roundtable meetings that brought together veterans, veterans advocates, and other public and private sector experts to discuss how to make Colorado the best place to live and work for veterans. Members of the group who work with veteran students cited the repayment issue as a major concern during the course of those meetings.
Full text of the letter is below:
Dear Secretary Shinseki:
I write to request that the U.S. Department of Veterans Affairs (VA) consider changing its policy regarding the manner in which veteran students must repay benefit overpayments.
Under the VA’s current policy, after receiving a debt notification letter due to an overpayment, a veteran student has 30 days to contact the VA and either repay the entire debt, establish a repayment plan, or request a waiver of debt. If the student veteran does not fulfill his or her obligation within the 30-day window, the VA will begin to offset the debt amounts from future GI Bill payments to the student.
We have heard from veteran students and from those who help students navigate their benefits that the VA suspension of benefits often happens immediately upon recognition of a debt and sometimes before the VA Debt Management Center notifies the student that there is a debt on their account. The student is treated the same without regard to whether the student, the school, or the VA is at fault for the overpayment. As you know, veteran students who are dependent on GI Bill benefits often have no other means of financial support. Suspending housing or tuition benefits can leave a veteran student in an untenable financial position and without the means to live or continue his or her education.
To avoid this situation in the future, I respectfully request that when the VA finds it is necessary to reduce the payment benefits to students, it do so by taking eligibility time off of the end of their benefits, instead of immediately upon discovery of the overpayment.
For example, if a student received a debt letter for $3,000 and they are receiving $1,500 per month for their monthly living allowance at a particular institution, then they would receive two fewer months of benefits at the end of their eligibility period. If the debt is valid and the student was overpaid, they would be able to buy the time back. If the debt is not valid, the months lost or deducted from the end of the eligibility period would be reinstated. Also, if a student transfers institutions without making arrangements to resolve the debt, then he or she would be required to pay the debt before proceeding at their new institution. Lastly, if a student drops out of school for six months without making arrangements, then he or she would also be personally responsible for the debt.
This change in policy would allow veteran students the necessary time to plan for payment or find another means to support their living and educational expenses when their benefits run out. It would also provide the VA and the school the time to fix any overpayment issues they caused without interfering with the veteran student’s ability to complete his or her education.
I fully recognize the responsibility of the VA in collecting any debts owed because of overpayments of benefits. I hope that we can work together so that the VA is able to collect the debts owed to it without unnecessarily impairing the ability of veterans to use their benefits and complete their education.
Thank you for your consideration of this matter. I look forward to your reply.
Michael F. Bennet