Should Students in “Boot Camps” Get Federal Financial Aid?

In the last several years, a number of companies have started short-term, intensive training programs in fields such as computer programming, Web design, and business designed to give fresh college graduates the skills they need to land lucrative jobs in growing fields. These “boot camps” include offerings by start-up companies such as Dev Bootcamp, General Assembly, and Koru as well as some entries from branches of traditional colleges (such as Rutgers). This sector is rapidly growing, with one organization estimating that about 16,000 students will complete coding boot camps in 2015.

Boot camps may tout their high job placement rates, but they are not cheap for students. The typical program costs about $11,000 for an 11-week program, although shorter options are often available in some fields. Unlike for most undergraduate and graduate programs through traditional colleges, these programs are currently not eligible for federal financial aid dollars. This means that students have two options to pay for these programs: paying out of pocket or taking out a private loan. However, the U.S. Department of Education is beginning an “experimental sites” program that will allow a small number of colleges to partner with unaccredited providers like boot camps to offer courses and receive federal financial aid.

Should students in boot camp programs be able to receive federal grants and loans? The best argument toward allowing students to receive federal funds for these programs (after a careful vetting process) is that it would allow students with modest financial means and little creditworthiness of their own to easily pay for some or all of these programs. These programs tend to recruit heavily from selective colleges with fewer low-income students (see the list of Koru’s partners), where ability to pay hasn’t been such a concern to this point. But as the sector expands to include colleges with more economic diversity, financing these programs could become a problem.

On the other hand, the highly vocational nature of these programs allows for different financing structures to make sense. This can happen through private loans focused on high-quality programs, which is the goal of the partnership between private lenders Skills Fund and six boot camps. Income share agreements are also a potential fit in this area, although I do have concerns about whether successful graduates would want to give up equity in themselves rather than just make loan payments. Finally, it remains to be seen whether boot camps themselves would actually be interested in going through certification and quality assurance processes that are likely to accompany federal student aid. For example, General Assembly’s co-founder told Inside Higher Ed that he didn’t want to receive federal student aid due to concerns about federal aid leading to higher prices in the future (the so-called “Bennett Hypothesis”). Others, such as Alex Holt at New America, have concerns about additional federal oversight leading to reduced program quality and less innovation.

I’ve thought about the dueling concerns of access and flexibility regarding boot camps, and I still don’t know exactly where I stand. The good thing here is that we’re likely to have a small number of programs get access to federal financial aid, so the effects of federal funding (and rules) can be examined before opening the spigot for more interested programs. I’d love to hear your thoughts on this question below, as this is a developing issue on which research badly needs to be conducted.

[Cross-posted at Kelchen on Education]

Robert Kelchen

Robert Kelchen, an assistant professor of higher education in the Department of Education Leadership, Management, and Policy at Seton Hall University, is data manager of the Washington Monthly College Guide.