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Business and Policy Areas
Business and Policy Areas

DoD Releases Revised MOU for Institutions Participating in TA Program

December 14, 2012

The Department of Defense recently released a new version of the Memorandum of Understanding (MOU) that institutions participating in the Tuition Assistance (TA) and other service-related tuition support programs are required to sign. Most of the notes that DOD had added to provide clarity to the previous version have been incorporated into the new version of the MOU. The DoD maintains a website that includes the sample MOU, a list of participating institutions, the application, and other resources.

While this is version two of the MOU, it is also referred to as "change one." Version three, or "change two," which will include provisions listed in President Obama's Executive Order 13607, is expected to go through a formal rulemaking process, with a draft published for public comment in the spring of 2013.

The new MOU includes restrictions on incentive compensation for securing enrollments. It also requires institutions to refrain from high-pressure recruiting and marketing practices, as well as from providing commissions and bonuses based on securing enrollments.

The most notable change to the MOU is the removal of the section requiring institutions to adhere to the Servicemembers Opportunity Colleges (SOC) Consortium Principles. Institutions that are members of SOC will continue to comply with the organization's policies. A school that is not a member of SOC will be required to:

  1. Disclose transfer credit polices
  2. Disclose policies on academic credit for prior learning experiences
  3. Disclose academic residency requirements pertaining to a student's program of study
  4. Disclose basic information about the institution's programs and costs
  5. Prior to enrollment, provide service members access to a financial aid advisor
  6. Prior to enrollment, provide information on add/drop, withdrawal, and readmission policies
  7. Conduct academic screening and competency testing
  8. Designate a point of contact for Service members seeking information on academic and financial counseling, as well as student support services

These requirements are fully explained in section 3(f) of the MOU.

Some business officers had been concerned about DoD insistence in the original MOU on making payments to schools through Visa. These provisions are generally unchanged, although an option has been maintained for schools that do not accept credit cards for tuition payments to be paid by check. Such payments will, however, be delayed. A provision intended to address the interplay between TA payments -- which are restricted to tuition and fee charges -- and Pell grants has been clarified. Institutions need to ensure that funds are applied appropriately, but do not have to wait until TA payments are made to disburse Pell grant funds.

Which Version to Sign?

Institutions that have signed the original MOU have the option of signing the revised version two, but are not required to do so. Any institution that did not previously sign the original MOU (version one) will need to sign version two if the institution wishes to participate in the DoD programs. When version three is released, all institutions participating in the TA program will need to sign the MOU regardless of what version they had previously agreed to.

The deadline to sign version two of the MOU is March 1, 2013.



Anne Gross
Vice President, Regulatory Affairs

Bryan Dickson
Senior Policy Analyst