RECORD OF PROCEEDINGS


	IN THE CASE OF:	  


	BOARD DATE:	  5 June 2007
	DOCKET NUMBER:  AR20060017068 


	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. Gerard W. Schwartz

Acting Director

Mr. Michael L. Engle

Analyst


The following members, a quorum, were present:


Ms. Linda D. Simmons

Chairperson

Mr. Joe R. Schroeder

Member

Mr. Chester A. Damian

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, in effect, that his student loan be paid off under the Loan Repayment Program (LRP).   

2.  The applicant states, in effect, that he was promised the loan would be paid.  He further states that he was never advised that his loan was not repayable until after he was in Iraq.  

3.  The applicant provides a copy of his enlistment contract and a letter from the Chief, Education Incentives Branch, United States Army Human Resources Command (USAHRC), dated 24 April 2003 with a DOD Educational Loan Repayment Program (LRP) Annual Application (DD Form 2475) signed by the certifying officer on 10 April 2003.

CONSIDERATION OF EVIDENCE:

1.  On 18 September 2001, the applicant enlisted in the United States Army Reserve for 8 years in the rank of private, pay grade E2.

2.  On 26 November 2001, the applicant enlisted in the Regular Army for 4 years in the rank of private first class, pay grade E3.  Prior to entry on active duty he had obtained a student loan in the amount of $10,502.00. 

3.  The applicant's Statement For Enlistment - United States Army Enlistment Program, shows that he enlisted in the Regular Army for United States Army Station/Unit/Area/Command Enlistment Program (Continental United States), the United States Army Incentive Enlistment Program, the United States LRP, and the United States Army Cash Bonus.  He was assured that, provided he met required prerequisites, he would receive training in military occupational specialty 96H1O (Common Ground Station Operator).

4.  The applicant's Record of Military Processing - Armed Forces of the United States (DA Form 1966) does not list his student loan.   However, his Statement For Enlistment informed him that the LRP would not repay student loans in excess of $65,000.

5.  By letter dated 24 April 2003, the Education Incentives Branch, USAHRC informed the applicant that his Sallie Mae Servicing Corporation (SMSC) Loan was a Career Training Loan, which did not qualify for repayment under the LRP. 

6.  The Department of Defense Educational Loan Repayment Program annual application (DD Form 2475) dated 10 April 2003, indicates that on 29 February 2000, the applicant obtained an SMSC loan for $10,502.00.  It further showed that payments were being made and that the balance at that time was $9,188.83. 

7.  On 7 March 2006, the applicant was honorably released from active duty and transferred to the United States Army Reserve control Group (Reinforcement).  He attained the rank of sergeant, pay grade E5 and had completed 4 years, 
3 months and 12 days of creditable active duty.

8.  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.  

9.  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.

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





11.  Title 10, U. S. Code, section 1552, the law which provides for the Board, states, "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 evidence of record shows the applicant enlisted for the LRP incentive up to $65,000.  He had obtained one student loan prior to his entry on active duty. 

2.  The applicant's loan did not qualify for repayment under the LRP.  There is no evidence to show and the Education Incentives Branch, USAHRC, did not indicate that the loan was in default prior to his entering active duty. 

3.  The applicant's SMSC Loan, totaling $10,502.00, did not qualify for repayment under the LRP because it was identified as a career training loan.  However, representatives of the United States Army led him to believe that the unpaid balance of $9,188.83 would be paid under the LRP.

4.  In the interest of justice and equity, it would be appropriate to provide the applicant the full LRP benefits outlined in his enlistment contract.  He has fulfilled his active duty commitment with regard to the LRP.

5.  The applicant’s military records may be corrected to show his enlistment contract was amended to include the sentence, "If a student loan is accepted by the officials 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."  This would allow the Board to invoke that provision and pay him the amount his lending institution would have been paid under the LRP.






BOARD VOTE:

LDS   __    __JRS __  __CD____ 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 the applicant's enlistment contract be amended to include the sentence, "If a student loan is accepted by the officials 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.  That as a result of the foregoing correction the Defense Finance and Accounting Service shall remit payment to the applicant the amount of his Sallie Mae Servicing Corporation Loan, in the total amount of $9,188.83, to which he is entitled as a result of this correction.




___Linda D. Simmons_____
          CHAIRPERSON




INDEX

CASE ID
AR20060017068
SUFFIX

RECON
 
DATE BOARDED
20070605
TYPE OF DISCHARGE

DATE OF DISCHARGE
 
DISCHARGE AUTHORITY
  . .  
DISCHARGE REASON

BOARD DECISION
GRANT
REVIEW AUTHORITY

ISSUES         1.
112.1200
2.

3.

4.

5.

6.