| Mr. Carl W. S. Chun | Director | |
| Mr. Joseph A. Adriance | Analyst |
| Mr. Fred N. Eichorn | Chairperson | ||
| Mr. Ted S. Kanamine | Member | ||
| Ms. Lana E. McGlynn | Member |
APPLICANT REQUESTS: In effect, that he receive payment for the interest on his student loans.
APPLICANT STATES: In effect, that the Student Loan Repayment Program (SLRP) addendum to his enlistment contract stated that repayment would be
15 percent or $500.00, whichever is greater, plus interest.
EVIDENCE OF RECORD: The applicant's military records show:
The applicant is a member of the Army National Guard (ARNG) that is authorized the SLRP incentive option at the total amount of $10,000.
On 20 February 2002, the applicant was provided a copy of his student loan calculation sheet for the Calendar Year (CY) 2002 with a memorandum from the Incentive Manager, National Guard of Kansas. This memorandum also informed the applicant that he had zero remaining on his $10,000.00 SLRP. In addition, he was advised that interest was not paid if it would have exceeded the maximum allowed pursuant to the National Guard Bureau (NGB) policy memorandum 01-08, which was enclosed.
NGB policy memorandum 01-08, dated 27 August 2001, Subject: Repaying Student Loans in Excess of Limitations, contained guidance on the repayment of student loans. It stated that the Department of Defense (DoD) Office of The General Counsel (OTGC), determined that there was an error in the DOD administration of the existing law for the SLRP. It further explained that the maximum amounts contained in Title 10 of the United States Code, section 16301 and 16302 must be observed. There is no authority to pay amounts (whether that amount is principle, interest, or a combination of the two) in excess of the statutory maximum. For example, under section 16301, the total amount that DoD may pay (in principle and interest) may not exceed 15 percent or $500.00, whichever is greater. The amount paid in interest may not be paid in addition to these statutory maximums. Therefore, effective immediately upon the publication of the policy letter, payments on student loans could not exceed the maximum amounts allowed by law. Further, interest would not be calculated or paid as a separate amount of the 15 percent or $500.00, whichever is greater. Finally, it was stipulated that this policy applied to SLRP contracts already in affect and all future contracts.
DISCUSSION: Considering all the evidence, allegations, and information presented by the applicant, together with the evidence of record, applicable law and regulations, it is concluded:
1. The Board notes the applicant’s contention that his SLRP contract addendum authorized him to be paid 15 percent or $500.00, whichever was greater, plus interest, and he should be paid interest on his student loans. However, the Board does not find this factor is sufficiently mitigating to warrant the requested relief.
2. By law, the maximum amount of principle and interest of a student loan that may be repaid is 15 percent or $500.00, whichever is greater. The amount of interest paid will not be paid in addition to this statutory maximum.
3. Although the applicant’s contract addendum stipulates that he would be repaid 15 percent of his student loan plus interest, this does not provide a sufficient basis to ignore the statutory limitations placed on student loan repayment and the requirement to comply with the law.
4. The applicant was properly notified of the misinterpretation of the law applied when he was contracted, and the Board finds that this compliance with the law is being applied equally to all soldiers with SLRP contracts currently in effect and all future contracts. Therefore, the legal limitations placed on the repayment of the applicant’s student loans does not constitute an injustice, and thus, the Board concludes that relief is not warranted in this case.
5. In view of the foregoing, there is no basis for granting the applicant's request.
DETERMINATION: The applicant has failed to submit sufficient relevant evidence to demonstrate the existence of probable error or injustice.
BOARD VOTE:
________ ________ ________ GRANT
________ ________ ________ GRANT FORMAL HEARING
__ FNE__ ___TSK_ _ _LEM__ DENY APPLICATION
| CASE ID | AR2002072589 |
| SUFFIX | |
| RECON | |
| DATE BOARDED | 2002/08/13 |
| TYPE OF DISCHARGE | N/A |
| DATE OF DISCHARGE | N/A |
| DISCHARGE AUTHORITY | N/A |
| DISCHARGE REASON | N/A |
| BOARD DECISION | DENY |
| REVIEW AUTHORITY | |
| ISSUES 1. 1026 | 112.1200 |
| 2. | |
| 3. | |
| 4. | |
| 5. | |
| 6. |
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