MEMORANDUM OF CONSIDERATION


         IN THE CASE OF:
        


         BOARD DATE: 26 July 2003
         DOCKET NUMBER: AR2002082497

         I certify that hereinafter is recorded the record of consideration of the Army Board for Correction of Military Records in the case of the above-named individual.

Mr. Carl W. S. Chun		Director
Ms. Beverly A. Young		Analyst

The following members, a quorum, were present:

Mr. Walter T. Morrison		Chairperson
Mr. Lester Echols		Member
Mr. Lawrence Foster		Member

         The Board, established pursuant to authority contained in 10 U.S.C. 1552, convened at the call of the Chairperson on the above date. In accordance with Army Regulation 15-185, the application and the available military records pertinent to the corrective action requested were reviewed to determine whether to authorize a formal hearing, recommend that the records be corrected without a formal hearing, or to deny the application without a formal hearing if it is determined that insufficient relevant evidence has been presented to demonstrate the existence of probable material error or injustice.

         The applicant requests correction of military records as stated in the application to the Board and as restated herein.

         The Board considered the following evidence:

         Exhibit A - Application for correction of military
records
         Exhibit B - Military Personnel Records (including
         advisory opinion, if any)

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APPLICANT REQUESTS: That the Army pay him the interest accrued due to late payment of his student loan.

APPLICANT STATES: That the loan repayment plan did not get paid until 9 years after interest had accrued on the balance of his student loan. He stated that the interest should have been factored into the amount of the loan that was paid. He also stated that the LRP was not paid during the 4-year timeline as shown on his military contract. In support of his application, he submitted a letter from the Acting Chief of Education Incentives; a DD Form 2475 (DOD Educational Loan Repayment Program Annual Application); a DA Form 3286-59 (Statement for Enlistment, United States Army Enlistment Program, U.S. Army Delayed Enlistment Program); a DA Form 3286-67 (Statement of Understanding); a DA Form 3286-64 (Statement for Enlistment, United States Army Station/Unit/Command/Area Enlistment Program); and a DA Form 3286-66 (Statement of Understanding, United States Army Incentive Enlistment Program).

EVIDENCE OF RECORD: The applicant's military records show:

The applicant entered the delayed entry program on 25 February 1993. His DA Form 3286-66 shows that he enlisted for the U.S. Army Student Loan Repayment Program (LRP) for an amount not to exceed $55,000.00. He enlisted in the Regular Army on 7 April 1993 for a period four years. The applicant reenlisted twice and is currently serving on active duty in pay grade E-6.

The applicant's DD Form 2475 shows that he had obtained a loan from Wofford College in the amount of $4,800. Section III (Loan Status Confirmation) on his DD Form 2475 shows that the loan was in default. This document also shows that the applicant had owed an outstanding balance of $7,465.70 and a balance of $3,268.08 of interest was due.

In a 5 October 1994 letter from the Acting Chief of Education Incentives, the applicant was informed that the U.S. Army would not pay loans which were in default. He was advised that payment could not be authorized toward defaulted loans and he should provide confirmation to this office of a change in his loan status. This letter stated that, "Public Law 99-145, Section 2171 precludes the authorization of payments toward interest and the reimbursement of payments made."

In the processing of this case an advisory opinion was obtained from the Acting Chief, Education Incentives and Counseling Branch, U.S. Total Army Personnel Command. That office recommends disapproval of the applicant's request.

The opinion points out that the applicant entered active duty on April 7, 1993 and that he enlisted for the LRP. The opinion stated that under this program, after each year successfully completed service on active duty, the Army would repay 33 1/3 percent or $1,500, whichever was greater, toward the qualifying remainder of the original unpaid principal on authorized loans. The opinion stated that payments could only be authorized on loans that had been verified by the loan holders.

The opinion also stated that the applicant was sent a DD Form 2475 in October 1994; however, the loan was in default. The opinion noted that in accordance with U.S. Army Recruiting Command Regulation 621-1, the U.S. Army would not pay loans there were in default. Further, the opinion stated that Army Regulation 621-202, Army Educational Incentives and Entitlements, Chapter 3, Section 3-5, stipulated that the Army would not pay loans or portions of loans that were in default. The opinion noted that the applicant contacted the Education Incentives and Counseling Branch in February 2002. He was informed that an exception to policy would be made to pay on any of his qualifying defaulted loans, and the remaining original unpaid principal amount borrowed would be paid on such loans.

In conclusion, the Acting Chief of the Education Incentives and Counseling Branch stated that the U.S. Army does not assume an individual's loan. The individual remains responsible for payment and the status of the loan. Public Law 99-145, Section 671(a)(1) precludes the authorization of payments toward interest and the reimbursement of payments made. The opinion stated that there were no exceptions to the law.

A copy of the advisory opinion was provided to the applicant for comment on 31 January 2003; however, he did not respond within the given time frame.

The Loan Repayment Program is a Department of the Army enlistment option authorized by Public Law 99-145. This option is designed to increase Test Score Category I-IIIA accessions. Loans that qualify for repayment are Guaranteed Student Loan/Stafford Loans, National Direct Student Loan/Perkins Loans, William D. Ford Loans, Supplemental Loans for Students, Federally Insured Student Loans (FISL), Parent Loan for Undergraduate Students (PLUS), Auxiliary Loan Assistance for Students (ALAS), and consolidated loans which fall under Title IV, Part B or E of the Higher Education Act of 1965, or William D. Ford Loan. Before entering active duty, the loan must not be in default. The borrower is responsible for obtaining a deferment/forbearance with the loan holder and the loan must remain in good standing throughout the repayment process. Active Army LRP participants earn their first loan repayment after completion of a full year of active duty and for each full year thereafter, up to
3 years. Payment of 33 1/3 percent or $1,500, whichever is greater, is authorized annually to the loan holder on the total remaining original outstanding principal balance. Public Law 99-145, Section 671(a)(1) precludes the authorization of payments toward interest or the reimbursement of payments made.
DISCUSSION: Considering all the evidence, allegations, and information presented by the applicant, together with the evidence of record, applicable law and regulations, and advisory opinion(s), it is concluded:

1. The evidence of record shows the applicant enlisted for the LRP incentive. Records show he had obtained a student loan prior to his entry on active duty and this loan was in default.

2. The opinion points out that, as an exception to policy, the applicant's defaulted loan and any remaining original unpaid principal would be paid.

3. The Board considered the applicant's request that the Army pay him the interest accrued on his student loan that was paid. However, Public Law 99-145, Section 671(a)(1) precludes the authorization of payments toward interest or the reimbursement of payments made. Therefore, there is no basis for granting the applicant's request.

4. In order to justify correction of a military record the applicant must show to the satisfaction of the Board, or it must otherwise satisfactorily appear, that the record is in error or unjust. The applicant has failed to submit evidence that would satisfy this requirement.

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

WTM____ LE_____ LF______ DENY APPLICATION

                  Carl W. S. Chun
                  Director, Army Board for Correction
of Military Records

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INDEX

CASE ID	AR2002082497
SUFFIX
RECON	YYYYMMDD
DATE BOARDED	20030626
TYPE OF DISCHARGE	(HD, GD, UOTHC, UD, BCD, DD, UNCHAR)
DATE OF DISCHARGE	YYYYMMDD
DISCHARGE AUTHORITY	AR . . . . .
DISCHARGE REASON
BOARD DECISION	DENY
REVIEW AUTHORITY	Mr. Chun
ISSUES 1.	112.1200
2.
3.
4.
5.
6.