RECORD OF PROCEEDINGS


      IN THE CASE OF:


      BOARD DATE:        8 September 2005
      DOCKET NUMBER:  AR20040010505


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

|     |Mr. Carl W. S. Chun               |     |Director             |
|     |Mr. Ronald DeNoia                 |     |Analyst              |


      The following members, a quorum, were present:

|     |Mr. William D. Powers             |     |Chairperson          |
|     |Mr. John T. Meixell               |     |Member               |
|     |Mr. Larry J. Olson                |     |Member               |

      The Board considered the following evidence:

      Exhibit A - Application for correction of military records.

      Exhibit B - Military Personnel Records (including advisory opinion,
if any).

THE APPLICANT'S REQUEST, STATEMENT, AND EVIDENCE:

1.  The applicant requests that his Citizens Bank student loan be repaid.

2.  The applicant states that when he enlisted in May 2002, he was promised
that his student loan would be repaid.  The applicant states that in March
2004 he was informed that his Citizens Bank loan did not qualify for
repayment under the student loan repayment program (SLRP).  The applicant
further states that the SLRP was what brought him to the decision to enlist
in the Army and that his understanding of the Army's repayment of his
student loan impacted on his future life decisions.

3.  The applicant provides a USAREC FM 1150-R-E; a Student Loan Disclosure
Statement from Citizens Bank; a letter from the Human Resources Command;
and a DD Form 2475.

CONSIDERATION OF EVIDENCE:

1.  The applicant enlisted in the Regular Army on 20 April 2002, for a
period of 4 years, with participation in the SLRP (up to $65,000) and a
cash enlistment bonus of $11,000 (Options 9A and 9C).

2.  On 4 March 2004, the applicant received notification from the Human
Resources Command (HRC) informing him that his Citizens Bank student loan
did not qualify for payment under the SLRP because it was a private trust
loan, which is not made, insured or guaranteed under Title IV Part B, D, or
E of the Higher Education Act.

3.  Item 11 of the USAREC Form 1150-R-E (Statement of Understanding) shows
that the applicant initialed the box indicating "Enlisted for Cash
Bonus/LRP".

4.  DA Form 3286-59 (United States Army Enlistment Program) shows that the
applicant enlisted for program 9A (U.S. Army Training Enlistment Program)
and program 9C (U.S. Army Incentive Enlistment Program).  Next to program
9C "Cash Bonus $11,000 LRP" is hand-written.  This form is signed by both
the applicant and the counselor.

5.  DA Form 3286-66 (Statement of Understanding United States Army
Incentive Enlistment Program) confirms the applicant’s enlistment option
and included incentives.  The LRP is one of the incentives authorized in
this Annex and the applicable LRP terms are listed in paragraph 4.

6.  The LRP provisions of the DA Form 3286-66 state, in pertinent part,
that the applicant understood that the government will repay a designated
portion of any loan he incurred that was made, insured or guaranteed under
Part B of the Higher Education Act (Guaranteed Student Loan) or any loan
under Part E of such act (National Direct Student Loan) after 1 October
1975 and before he enlisted in the Army.

7.  Further, the DA Form 3286-66 indicates that the applicant’s enlistment
for the LRP ensured him, provided he met and maintained the prescribed
prerequisites, that the portion or amount of his student loan that could be
repaid was 33 1/3 percent or $1,500, whichever was greater of the unpaid
principal balance for each year of service completed, not to exceed
$65,000.  The applicant and the service representative both signed this
document, and there is no indication in this form that any question was
raised in regard to his eligibility for the LRP or the eligibility of his
loan to qualify for repayment.

8.  On 4 March 2004, the applicant was advised by the Chief, Education
Incentives and Counseling Branch, Human Resources Command (HRC), that they
had received the Department of Defense (DD) Form 2475 (DoD Educational Loan
Repayment Program Annual Application) from Citizens Bank, and they had
determined the loan totaling $12,719.68 did not qualify for repayment under
the LRP.

9.  The applicant was further advised by HRC that in order to be eligible
for repayment of their student loans, soldiers who have the LRP in their
enlistment contract must meet certain standards and their loans must have
been made, insured, or guaranteed under the Higher Education Act of 1965,
Parts B, D, or E.

10.  In addition, the applicant was informed that payment of loans that do
not qualify would be in violation of the law governing the LRP and that
there are no exceptions to the law.  He was finally advised to apply to
this Board if he believed he was improperly counseled or that an error or
injustice had occurred.

11.  Army Regulation 601-210 (Regular Army and Army Reserve Enlistment
Program) prescribes eligibility criteria governing the enlistment of
persons, with or without prior service (PS), into the Regular Army (RA) and
the USAR.  Chapter 9 (Enlistment Programs/Options) indicates that these
programs/options are designed to merge valid Army requirements with
personal desires.

12.  Table 9-4 contains guidance on enlistment option program 9C
(Bonus/Army College Fund/Loan Repayment Program).  It contains specific
guidance pertaining to the LRP and indicates that the government will repay
a designated portion of any loan incurred that was made, insured, or
guaranteed under part
B of the Higher Education Act of 1965 (Guaranteed Student Loan) or any loan
under part E of such act (National Direct Student Loan) after 1 October
1975 and before enlistment into the Regular Army.

13.  Table 9-4 also provides program processing procedures that require
Army Guidance Counselors to accomplish specific counseling and
administrative actions in connection with processing members enlisting with
the LRP incentive.  These actions include ensuring members are disenrolled
from the GI Bill; verifying that members have qualifying loans; and
advising members of any loan that is not eligible.

14.  The regulation further states that Guidance Counselors are
specifically required to confirm they accomplished all the processing
procedures by making the appropriate entries in the DD Form 1966 and DA
Form 3286-66.  This includes a statement advising members of any loan he or
she has that is not eligible for repayment and ensuring the applicant’s
acknowledgement of this fact is also recorded in the remarks section of the
DD Form 1966.

15.  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.  The Government will not make any payments to the
soldier or reimburse a soldier if he or she pays off a student loan.  The
Government will only pay the lending institution.

16.  Title 10, U.S. Code, section 1552, the law which provides for the
Board, states that “The Secretary may pay, from applicable current
appropriations, a claim for the loss of pay, allowances, compensation,
emoluments, or other pecuniary benefits, or the repayment of a fine or
forfeiture, if, as a result of correcting a record under this section, the
amount is found to be due the claimant on account of his or another’s
service in the Army, Navy, Air Force, Marine Corps or Coast Guard, as the
case may be.”

DISCUSSION AND CONCLUSIONS:

1.  The applicant’s loan does not meet the criteria established by law;
however, that is not the overriding factor in this case given the equity
considerations and the resultant injustice.

2.  A careful review of the evidence of record reveals that the DA Form
3286-66 clearly established a contractual agreement, between the applicant
and the Army, that he would receive LRP benefits in connection with his
active duty enlistment.

3.  Although it is clear that the DA Form 3286-66 specified the types of
loans for which LRP benefits were authorized, there is absolutely no
indication that the applicant was ever advised of these specific provisions
of the LRP or of the specific criteria required for a loan to qualify for
repayment under the law governing the LRP.

4.  By regulation, Army Guidance Counselors are required to verify that a
member enlisting for the LRP has qualifying loans and to advise those
members if any loan is not eligible for repayment.  Further, these service
representatives must confirm these actions were accomplished by making the
appropriate entries in the enlistment contract or associated documents.

5.  Notwithstanding the fact that the DA Form 3286-66 outlined the legal
criteria for repayment under the LRP, the applicant’s enlistment contract
and associated documents contain no entries verifying that he was ever
properly counseled in regard to the legal loan repayment restrictions.

6.  Further, the record gives no indication that an Army Guidance Counselor
ever verified that the applicant’s loan did or did not qualify for
repayment under the LRP.  In addition, there is no suggestion that this
verification was ever made a part of the record with the required entries
being made in the enlistment contract prior to the applicant entering
active duty.
7.  Although the applicant had not provided a statement from recruiting
officials corroborating his claim, it is unreasonable to presume that he
would have still enlisted without the Student Loan Repayment Program had he
been verbally informed that his loan did not qualify under that program.

8.  In view of the above it is determined that the applicant was improperly
counseled in regard to LRP benefits and it that it would be appropriate to
rectify this injustice at this time.  Therefore, in the interest of justice
and equity, it would be appropriate to provide the applicant the LRP
benefits outlined in his enlistment contract as if his loan qualified for
repayment under the law.

BOARD VOTE:

__wdp___  __jtm___  __ljo___  GRANT FULL RELIEF

________  ________  ________  GRANT PARTIAL RELIEF

________  ________  ________  GRANT FORMAL HEARING

________  ________  ________  DENY APPLICATION

BOARD DETERMINATION/RECOMMENDATION:

1.  The Board determined that the evidence presented was sufficient to
warrant a recommendation for relief.  As a result, the Board recommends
that all Department of the Army records of the individual concerned be
corrected by: amending the applicant’s DA Form 3286-66, Statement of
Understanding, US Army Incentive Enlistment Program, to include the
sentence, “If a student loan is accepted by the official processing you for
enlistment as payable under the LRP and the Government fails to verify that
the student loan accepted actually is eligible under the Higher Education
Act of 1965 and such failure results in nonpayment of the loan by the LRP
or the repayment or default of the loan, the Army Board for Correction of
Military Records may pay the loan, at its sole discretion, in accordance
with Title 10, U.S. Code, section 1552.”
2.  As a result of the above correction the Defense Finance and Accounting
Service (DFAS) shall remit payment to the applicant of the total amount of
the loan obtained from Citizens Bank, in the amount of $12,719.68, to which
he is entitled as a result of this correction.  The applicant will submit
the appropriate evidence (promissory notes, etc.) to the DFAS to determine
the amount due, if required.



                                        William D. Powers
                                  ______________________
                                            CHAIRPERSON

INDEX

|CASE ID                 |AR20040010505                           |
|SUFFIX                  |                                        |
|RECON                   |                                        |
|DATE BOARDED            |20050908                                |
|TYPE OF DISCHARGE       |                                        |
|DATE OF DISCHARGE       |                                        |
|DISCHARGE AUTHORITY     |                                        |
|DISCHARGE REASON        |                                        |
|BOARD DECISION          |GRANT                                   |
|REVIEW AUTHORITY        |                                        |
|ISSUES         1.       |100.0000                                |
|2.                      |                                        |
|3.                      |                                        |
|4.                      |                                        |
|5.                      |                                        |
|6.                      |                                        |


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