BOARD DATE:	  25 October 2011

		DOCKET NUMBER:  AR20100029857 


THE BOARD CONSIDERED THE FOLLOWING EVIDENCE:

1.  Application for correction of military records (with supporting documents provided, if any).

2.  Military Personnel Records and advisory opinions (if any).


THE APPLICANT'S REQUEST, STATEMENT, AND EVIDENCE:

1.  The applicant requests that his past due student loan for the period 26 June 2001 to 26 June 2002 be repaid by the Army's Student Loan Repayment Program (SLRP).

2.  He states he:

* submitted a DD Form 2475 (Department of Defense Educational Loan Repayment Program Annual Application) on or after 26 June 2002
* believes the Unit Administrator never followed through nor did he/she do his/her part
* states he should be reimbursed the principal amount
* went into the Individual Ready Reserve (IRR) and didn't know how to continue the reimbursement process for his student loan
* didn’t find out until approximately June 2008 that his congressman could assist him

3.  He provides:

* letter from the U.S. Army Human Resources Command, Fort Knox, KY
* DA Form 5261-2-R (Selected Reserve Incentive Program – Reenlistment/Extension Bonus Addendum)
* DD Form 4 (Enlistment/Reenlistment Document), dated 26 June 2001
* DA Form 3540 (Certificate and Acknowledgement of U.S. Army Reserve (USAR) Service Requirements and Methods of Fulfillment)
* DA Form 5261-4-R (SLRP Addendum)
* DA Form 5435-R (Statement of Understanding – The Selected Reserve Montgomery GI Bill)
* Congressional Casework Authorization Form
* Congressional letters
* Packet of various documents he mailed to the Army on 14 October 2009
* Discharge orders from the USAR

CONSIDERATION OF EVIDENCE:

1.  The applicant completed prior service in the Regular Army from 21 June 1983 through 18 April 1984.  After a break in service, he enlisted in the Army National Guard on 29 December 1989.  

2.  He provided a copy of a promissory note, signed on 1 December 1991, which lists two guaranteed student loans (consolidated) in the total amount of $5,140.99 from Citibank.  

3.  He was discharged from the Army National Guard and as a Reserve of the Army on 13 January 1994.  On the following day, he enlisted in the USAR.  He reenlisted in the USAR on 8 January 1997.  

4.  On 26 June 2001, he reenlisted in the USAR for a period of 6 years in military occupational specialty (MOS) 97B (Counterintelligence Agent).  At the time of his reenlistment, he completed a DA Form 5261-2-R for a Reenlistment/Extension Bonus in the amount of $5,000.00.  He signed a statement indicating he was reenlisting for 6 years and had less than 14 years of total military service at expiration of term of service.  He acknowledged that he was entitled to the $5,000.00 reenlistment bonus and his initial payment was $1,000.00 and subsequent payments would be paid on satisfactory completion of each year of the 6-year term of service.  

5.  He initialed Section IX (Additions or Changes to this Certificate) of his DA Form 3540, dated 26 June 2001, indicating that an addendum had been completed, signed by the Soldier, and attached to this certificate for the SLRP and Selective Reserve Incentive Program-Reenlistment/Extension Bonus.  

6.  He provided a copy of a DA Form 5261-4-R, which shows in:

   a.  Section III (Acknowledgement) – he initialed item 2 and 2a(1) indicating he had previous military service or was currently a member of the Army National Guard of the United States or USAR, and was contracting to serve for 3 or more years in the Selected Reserve.  In addition, he was contracting to serve in MOS 97B that Headquarters, Department of the Army had approved for a maximum of $10,000 in loan repayments.  
   
   b.  Section V (Entitlement) – he initialed item 3a indicating that repayment of the qualifying student loan(s) would be made after each year of satisfactory service in the Selected Reserve after securing the loan(s) and reaching the anniversary date of this agreement.  For each year of satisfactory service in the Selected Reserve, the loan amount to be repaid would be a maximum of $10,000.00 during his military career as he had acknowledged in section III, and that amount would not increase.  The amount to be repaid each year would not exceed 15 percent (%) of the original balance (a maximum of $1,500.00) or $500.00, whichever was greater, plus the accrued interest.  
   
   c.  Section V (continued) – he initialed item 4 indicating he understood that:  
   
   (1)  the repayment of student loans by the government was not automatic 
under the terms of this addendum.  It was his responsibility to initiate the request for loan repayments during each year that he met the requirements explained in this addendum, by completing a DD Form 2475 and submitting it to personnel officials in his command.

		(2)  he should arrange for deferment or forbearance with lenders or note holders on loans which were falling due.

		(3)  loan repayments would only be made to the lender or note holder and nothing in this agreement would be construed as authority to refund any repayment of a loan.  

   d.  Section V, item 5 states that loan repayments were subject to Federal and State income tax withholdings.  
   
   e.  Section VIII (Statement of Understanding) – he signed the addendum indicating he read and understood each of the statements and had his questions satisfactorily answered.  

7.  On 13 July 2001, a Staff Administrator, 6th Battalion, 108th Regiment, 3rd Brigade, 108th Division, Fort Bragg, NC, submitted a request to Citibank for an extension of forbearance to be granted for the applicant.  The letter indicated that the applicant was:

* assigned to this unit as a staff sergeant in the USAR and reenlisted on 26 June 2001 for 6 years
* obligated until 25 June 2007
* was eligible for the SLRP with his reenlistment and the loan would commence one year from the date of his reenlistment on 26 June 2002

8.  The applicant provided a copy of a DD Form 2475, signed by him and a Personnel/Unit Records Custodian on 8 June 2002, which was not completed by the lender, Citibank.  

9.  His enlistment contract does not list any student loans that may have qualified for SLRP.  His service record is void of evidence which indicates he provided the recruiter any information pertinent to the SLRP and any review of promissory notes and determination as to the qualification of the loans for repayment under the SLRP, and any counseling that may have been given the applicant pertinent to any loans that did not qualify.  At the time, the loan had an unpaid principal balance of $1,671.57 as indicated on the Citibank Account Statement (as of 9 May 2001).  

10.  Orders published on 15 March 2003 reassigned the applicant to the USAR Control Group (Reinforcement), effective 15 March 2003.  

11.  Orders published on 26 June 2007 show the applicant was honorably discharged from the USAR, effective 26 June 2007.  

12.  In a 13 May 2009 letter, a representative from the EdFund, Internal Collections Unit, Rancho Cordova, CA informed the applicant that his loan disbursed on 3 February 1992 for $5,184.90 had been paid in full.  

13.  In an 11 September 2009 letter, the Chief of The Adjutant General, Directorate, West, U.S. Army Human Resources Command, St. Louis, MO, informed a congressman that the applicant reenlisted in the Army Reserve for 6 years on 26 June 2001.  The contract shows that he could have received SLRP as an incentive, but there was no DA Form 5261-4-R on file.  The letter indicated the applicant transferred to the IRR on 15 March 2003.  Since SLRP was paid only while in the Selected Reserve based on anniversary payments, the applicant could be eligible for one payment of SLRP not to exceed $1,500.00.  The letter advised that if the applicant obtained qualifying student loan(s) prior to or during his time in the Selected Reserve, he could submit completed DD Form 2475(s) for each loan he possessed.  The DD Form 2475(s), copies of loan agreement(s) and any disclosure statements and a copy of his DA Form 5261-4-R were to be sent to Commander, U.S. Army Human Resources Command, ATTN:  AHRC-EPB-PR, 1 Reserve Way, St. Louis, MO 63132.  



14.  In a handwritten letter, dated 11 October 2009, including various documents, the applicant outlined the following:

Date of action or effective date
Action 
Result(s)
26 June 2001
He signed a 6-year contract with a reenlistment bonus and SLRP with the USAR

8 June 2002
He submitted a DD Form 2475 requesting the USAR to pay his student loan and he sent emails
No action taken
15 March 2003
He joined the IRR, but between 26 June 2001 and 26 June 2002 the USAR owes him 15% or $500 (greater of 2) towards his student loan


His student loan balance was $1,846.71 on 26 June 2002

30 July 2004
EdFund put an offset with the Internal Revenue Service (IRS), effective 30 July 2004


He has been in/out of jobs since then


EdFund has collected $4,282.32 through offsets
According to EdFund, his loan is paid in full, effective 13 May 2009
15.  In a 14 December 2010 letter, the Chief, Education Incentives Branch, U.S. Army Human Resources Command, Fort Knox, KY informed the applicant that a review of his official military personnel file was conducted and there was no indication that he contracted for the SLRP.  The letter stated that if the applicant was promised the SLRP, he would have signed a DA Form 5261-2-R.  The only documentation in his official file was for the $5,000.00 reenlistment bonus.  Further, the letter stated that even if the applicant had a copy of the DA Form 5261-4-R, there were no provisions or guidance that would allow the Department of the Army to reimburse an individual for payments already made, even payments made by default action.  Public Law 99-145, Section 16301(d) precluded the reimbursement of payments made.  The applicant was advised to apply to this Board.  

16.  In a 6 October 2011 email, a staff member from the Army Reserve G-1 provided a breakdown of payments made on behalf of the applicant.  The beginning principal balance was $6,027.00:

	a.  The National Guard made payments under SLRP totaling $4,122.26 for entitlement years 1990 to 1993.

	b.  The Army Reserve made payments under SLRP totaling $907.35 for entitlement years 1994 to 1995.

	c.  This would leave an outstanding principle balance of $997.39.  

17.  The SLRP provides for the repayment by the Government of a designated portion of any outstanding student loan(s) secured after 1 October 1975.  The loan amount to be repaid is 15 percent of the original balance of the loan plus accrued interest not paid by the Department of Education, or $500 plus the accrued interest not paid by the Department of Education, whichever is greater.  Payments will be made for each year of satisfactory service in the Selected Reserve.  The maximum amount of loans against which the 15 percent is computed will not exceed $10,000.  This equates to a maximum annual repayment of $1,500 plus interest.  If the amount set for repayment is less than $500, then $500 becomes the calculated amount for repayment that year.   

18.  Army Regulation 135-7 (Army National Guard and U. S. Army Reserve Incentive Programs) provided that to be eligible for the SLRP incentive, a person must contractually obligate himself or herself to serve satisfactorily, must serve in a reserve unit for a full term of the contractual agreement and must further obligate himself or herself to continue to serve in the same component and the same MOS unless excused for the convenience of the Government.  Entitlement to the SLRP will stop if the Soldier is separated from the Selected Reserve.  Each complete satisfactory year of service performed under this SLRP agreement establishes an anniversary date.  Any qualifying loan which is at least a year old may then be paid in accordance with the terms of this educational enlistment incentive.

19.  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.

20.  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 evidence of record shows the applicant reenlisted in the USAR, in good faith, for the SLRP and a $5,000.00 Reenlistment/Extension Bonus on 26 June 2001.  

2.  The promissory note shows he had two guaranteed students in the total amount $5,140.99 from Citibank.

3.  The applicant’s finance records reveal that the Army National Guard made payments on student loans totaling $4,122.26 for entitlement years 1990 to 1993 and the Army Reserve made payments on student loans totaling $907.35 for entitlement years 1994 to 1995 (this left an outstanding principle balance of $997.39).  

4.  The applicant has already paid off his student loans and the Government will normally only pay the lending institution.

5.  The applicant's military records should be corrected to show his DA Form 5261-4-R, was also amended to include the sentence, "If a student loan is later determined to not be eligible for payment for any reason, the ABCMR 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 SLRP if he has, in fact, paid off his loans.

BOARD VOTE:

___X_____  ___X_____  ____X_  GRANT FULL RELIEF 

________  ________  ________  GRANT PARTIAL RELIEF 

________  ________  ________  GRANT FORMAL HEARING

________  ________  ________  DENY APPLICATION

BOARD DETERMINATION/RECOMMENDATION:

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:

	a.  amending his DA Form 5261-4-R to include the sentence, "If a student loan is accepted by the officials processing you for enlistment as payable under the SLRP and the government fails to verify that all other enlistment documents are properly prepared so as to enable the loan to be repaid and such failure results in nonpayment of the loan by the SLRP or the repayment or default of the loan, the ABCMR may pay the loan, at its sole discretion, in accordance with Title 10, U.S. Code, section 1552"; and 

	b.  As a result of the foregoing correction the Defense Finance and Accounting Service (DFAS) shall remit payment to the applicant and/or his lending institution the total amount of his student loans up to the amount of 
$997.39.  He will be required to submit the appropriate evidence (promissory notes, etc. and/or evidence to show he paid off the loans) to DFAS, if required by DFAS.



      ________X_______________
       	   CHAIRPERSON
      
I certify that herein is recorded the true and complete record of the proceedings of the Army Board for Correction of Military Records in this case.


ABCMR Record of Proceedings (cont)                                         AR20100029857





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ABCMR Record of Proceedings (cont)                                         AR20100029857



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