Effort in works to fix state's GI Bill problem VETERANS AFFAIRS Because UC system charges 'fees,' not 'tuition,' state's vets could lose benefit

1LT Melanie Walker with the 445th Civil Affairs Battalion stands for a portrait at Jones Hall on Thursday July 30, 2009 in Mountain View, Calif. 1LT Melanie Walker with the 445th Civil Affairs Battalion stands for a portrait at Jones Hall on Thursday July 30, 2009 in Mountain View, Calif. Photo: Lea Suzuki, The Chronicle Photo: Lea Suzuki, The Chronicle Image 1 of / 3 Caption Close Effort in works to fix state's GI Bill problem 1 / 3 Back to Gallery

With hours remaining before the new, Post-9/11 GI Bill takes effect, officials from California and from the Department of Veterans Affairs are working to fix a technical glitch that threatens to prevent thousands of California veterans from receiving money for tuition.

Officials were unable to say for certain Friday whether the problem will be fixed in time to help veterans in the current academic year.

The new GI Bill takes effect today, with President Obama attending a kickoff event with Secretary of Veterans Affairs Eric Shinseki on Monday, when tuition checks will begin being sent to colleges across the nation.

"The Obama administration and Secretary Shinseki are actively working with officials to find a viable solution that will provide veterans with the maximum financial support to attend the school of their choice," said VA spokeswoman Katie Roberts.

Qualified veterans attending undergraduate public colleges and universities in California will be able to enjoy the new benefit. But a California quirk had thrown into question whether or not veterans attending private and graduate institutions would be able to receive the same benefits as veterans in other states.

The problem stems from California's history of labeling the money students pay to attend state universities "fees" instead of "tuition." The new GI Bill reimburses qualified veterans for their full undergraduate tuition at public colleges and pays an amount equivalent to that tuition to veterans who choose to attend private schools or graduate programs.

Because the University of California charged no "tuition" - instead charging "fees" - the VA had ruled that veterans attending private schools or graduate programs in California could receive no tuition reimbursement, even though most of the cost of those programs is called tuition.

Such students could be reimbursed fees - along with other new GI Bill benefits such as a housing allowance and book budget - but many veterans seeking to attend private or graduate institutions came up thousands of dollars short for tuition.

In July, UC officials stopped calling the money students paid a fee and started calling it tuition to avoid harming veterans, said Nancy Coolidge, the UC system's coordinator of student financial support. The new fee structure and terminology was sent to the VA in early July, she said.

In May, Rep. Mike Thompson, D-St. Helena, and Rep. Howard "Buck" McKeon, R-Santa Clarita (Los Angeles County) introduced legislation that would have effectively erased the distinction between fees and tuition in the new GI Bill. The bill gained 48 co-sponsors from across California.

Both of California's senators asked the VA to revise the regulation, while Secretary of Education Arne Duncan told McKeon in a May hearing that fixing the problem was a "no-brainer."

Some veterans are holding out hope that a solution will be found, but others say they do not expect a solution for this academic year.

Santa Clara's Melanie Walker, 39, a 1st lieutenant in the Army Reserve who served two combat tours in Baghdad, will study at the University of Southern California's military social work program and hopes to get support from the GI Bill.

Failing that, she has federal and private student loans and a backup plan: returning to active-duty and committing to the time required for the Army's student loan forgiveness program.

"I would just go active and be a military social worker for the Army. But I don't think it's going to come to that ... the GI Bill problem will sort itself out," she said. "We're all kind of still waiting and holding our breath to see what happens."