According to the Department of Veterans Affairs’ (VA) most recent regulatory agenda, it plans to finalize a proposed rule that would make significant changes to requirements applicable to educational institutions that enroll students utilizing VA benefits, such as under the extremely popular Chapter 33 Post-9/11 GI Bill and Chapter 31 Veteran Readiness and Employment (VR&E) programs, both of which pay tuition and fees directly to schools. The new regulations, which are expected to become final in April and go into effect shortly thereafter, will implement the Veterans Benefits and Transition Act of 2018. As the Congressional Research Service explained, that bill made “a number of changes to educational benefits.”

Educational institutions and their School Certifying Officials (SCOs) should take note of these forthcoming regulations, as they could require major changes to some institutional payment policies, among other things. Failure to adjust educational institutions’ veterans’ benefits compliance programs could lead to disapproval of institutions to enroll further VA beneficiaries or more drastic regulatory actions by the VA and/or State Approving Agencies (SAAs). Indeed, the VA, SAAs, and other regulators with an interest in the provision of veterans’ educational benefits (such as the Federal Trade Commission and state attorneys general) have only increased their oversight of veterans’ educational benefits programs in recent years, as the high-profile examples of Howard University and Grand Canyon University illustrate.

As summarized below, the VA’s proposed rule — which generated very few public comments on VA’s rulemaking docket, suggesting a potential lack of awareness of the forthcoming changes by industry — has proposed several significant changes to its regulations. We would expect the VA to adopt its proposed rule with few, if any, material changes, given the lack of comments on the proposal. Based on VA’s proposed rule, therefore, educational institutions should anticipate the following regulatory changes soon:

• Clarification that an educational institution will face disapproval if it does not permit Post-9/11 or VR&E students to attend courses within their program of education beginning on the date the student provides eligibility documentation, until the earlier of the date VA provides payment to the educational institution, or 90 days after the date the educational institution certifies its tuition and fees charges to VA following receipt of the student’s eligibility documentation.
• Liberalization of what constitutes a “certificate of eligibility” that schools must accept for veterans’ educational benefits purposes, to include any verifiable and authoritative document describing the student’s entitlement to benefits. This could include not only the traditional, formal certificates from VA that SCOs are familiar with as evidence of a student’s entitlement (and protection) under veterans’ benefits laws, but also an administrative decision, notice, letter, or print-out from a variety of VA sources (among other things).
• Prohibition against the imposition of any penalty, including the assessment of late fees, denial of access to classes, libraries, or other institutional facilities, on Post-9/11 or VR&E students, as a result of delayed payments of educational assistance from VA.
• Prohibition against any requirement that Post-9/11 or VR&E students borrow additional funds to meet financial obligations to the institution as a result of delayed payments of educational assistance from VA.
• Allowance of a requirement for additional payment or imposition of a fee for the difference in the amount of a Post-9/11 or VR&E students’ financial obligation to the educational institution and the VA’s disbursement to the school on that individual’s behalf.
• Allowance for educational institutions to require Post-9/11 or VR&E students to:
  • Submit verifiable and authoritative proof of entitlement eligibility not later than the first day of a course of education for which the claimant has indicated he or she wishes to use entitlement to educational assistance.
  • Submit a written request to use such entitlement.
  • Provide additional information necessary to the proper certification of enrollment by the educational institution, provided, however, that any such additional requirement be proposed to and approved by educational institutions’ SAAs, and published in the schools’ catalog.