PROCEEDINGS

	IN THE CASE OF:       

	BOARD DATE:            25 September 2001
	DOCKET NUMBER:   AR2001057966

	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. Jessie B. Strickland		Analyst	

The following members, a quorum, were present:

	Mr. John N. Slone		Chairperson	
	Mr. Lester Echols		Member	
	Mr. Ronald E. Blakely		Member	

	The applicant and counsel if any, did not appear before the Board.

	The Board considered the following evidence:

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

FINDINGS:

1.  The applicant has exhausted or the Board has waived the requirement for exhaustion of all administrative remedies afforded by existing law or regulations.

2.  The applicant requests, in effect, that his debt to the government be voided, that all funds, to include interest, be returned to him and that all credit agencies be notified that the debt was not valid and should be removed from his records.

3.  The applicant states, in effect, that he initially enrolled in the Ready Reserve Mobilization Insurance Income Program (RRMIIP) at the rate of $1,500.00 per month on 21 October 1996, based on his current civilian salary.  However, after discussing the matter with officers and senior noncommissioned officers, they convinced him that he had been shortsighted, because his civilian salary would probably go up, yet he would not be able to adjust his RRMIIP benefits after the initial 90-day enrollment window.  Accordingly, he contacted a Defense Finance and Accounting Service (DFAS) representative by phone and was told that he could submit another enrollment application for a higher amount.  He submitted another application on 27 December 1996 for $3,000.00 in coverage and submitted a check for the change in premiums.  On 23 January 1997, he was ordered to active duty in support of Operation Joint Endeavor and was assigned to Europe for a 270-day tour of duty.  He continues by stating that on 23 February 1997, he became eligible for RRMIIP benefits and his first partial payment was made by the DFAS for the period of 1 April 1997 to 15 July 1997 on 1 April 1997.  He goes on to state that he was released from active duty (REFRAD) on 20 October 1997 and received his final RRMIIP payment of$5,250.00 on 15 July 1998, approximately 8 months after his REFRAD.  In October 1999, 2 years after his REFRAD, he received a notice from the DFAS informing him that they had incorrectly processed his increase in RRMIIP benefits and as a result had overpaid him $11,800.00 in RRMIIP benefits.   They assessed a 5% interest charge, notified credit agencies and began garnishing his United States Army Reserve (USAR) pay.  He contends that the debt is unjust, that he was within the window of increasing his benefits, that he had been informed by DFAS officials that he could increase his benefits and they accepted his increase in premiums throughout the entire period he was paid the benefits.  Accordingly, the acceptance of the premiums constituted a contract that should be honored and he should not be burdened with such a debt.  In support of his application he submits documents received from the DFAS, copies of his leave and earnings statements, copies of correspondence between him and a congressional representative, his mobilization orders, his separation document (DD Form 214) and a Congressional Research Service Report for Congress outling the problems associated with the RRMIIP. 

4.  The applicant’s military records show that On 21 October 1996, while serving as a USAR soldier in the pay grade of E-6, the applicant completed a DD Form 2746 (Ready Reserve Mobilization Insurance Certificate) in which he elected coverage in the amount of $1,500.00 and initialed after the amount selected in block 7a of that form.  The note contained in block 7 specifically states that once enrolled, he could reduce the amount or stop his participation at any time.  However, he could not increase his coverage.  A decision to decline coverage or terminate enrollment is generally irrevocable.  His election was approved on 4 November 1996.

5.  On 27 December 1996, he submitted another DD Form 2746 in which he elected coverage in the amount of $3,000.00.  His application was processed by the DFAS and his coverage was increased to that amount with appropriate premiums being accepted for payment.

6.  On 24 January 1997, he was ordered to active duty in support of Operation Joint Endeavor/Guard and became eligible for RRMIIP benefits effective 23 February 1997.  He received his first payment on 1 April 1997 and he remained on active duty until he was honorably REFRAD on 20 October 1997.  He received his final payment of RRMIIP benefits on 10 July 1998 in the amount of $5,250.00 for a total benefits amount of $28,850.00.

7.  On 2 July 1998 the DFAS sent the applicant a notice of overpayment of RRMIIP benefits in the amount of $11,800.00 and assessed a 5% interest penalty.  The debt was based on his being erroneously paid at the rate of $3,000 per month instead of $1,500.00 per month.  In subsequent correspondence to the applicant’s congressional representative, the DFAS explained that the second election form increasing his coverage should not have been processed because there were no provisions for increasing coverage once an election had been made and that there were no provisions for waiving overpayments of RRMIIP benefits.

8.  In similar correspondence to the same congressional representative, The Secretary of Defense explained that 290 Reservists were overpaid a total of $1,414,000 and that about one-half of those Reservists had either repaid or established a schedule for repaying their debts.  He also explained that payments under the RRMIIP are insurance benefits and not military pay and allowances.  Accordingly, the law provides no authority to waive such debts.  However, individuals could obtain relief from the Board.

9.  Department of Defense Instruction (DODI) 1341.10 implemented the RRMIIP procedures.  It states, in pertinent part, that a member who is automatically enrolled or who is offered an opportunity to enroll may make an election within 60 days of the first day of the first full month after such automatic enrollment or of being offered the opportunity to enroll.  Members may elect a reduced coverage, an enhanced coverage or decline enrollment.  A member who is already enrolled or offered coverage may at any time after their initial election reduce their coverage or cancel enrollment. 

10.  Army Regulation 600-4 provides the instructions for submitting and processing applications for remission or cancellation of indebtedness to the United States that resulted while on active duty.  Applications must be based on injustice, extreme hardship, or both.  This includes debts caused by error made in pay to or on behalf of soldiers.  Cases submitted based on hardship, require evidence to show that collection of the debt will cause a financial hardship to the soldier and or his family.

CONCLUSIONS:

1.  Inasmuch as the DFAS accepted his application to increase his RRMIIP benefits and the associated premiums, and because it took over 2 years to discover the error, the Board finds that the government cannot avoid its major role in causing the error.

2.  The Board finds all RRMIIP benefits were lawfully paid to the applicant pursuant to the actual and implied contract between the applicant and the Army.  Consequently, the applicant has no debt as a matter of law; and the debt alleged by DFAS, and all interest and any other charges arising therefrom, are void from their inception.

3.  Additionally, and in any event, the Board determines the best interests of justice, consistent with Congressional intent, warrants the complete remission and cancellation of the debt, if it were valid. 

4.  The Board believes that it would be appropriate to direct the correction of the applicant’s records to show that he was enrolled in the RRMIIP in October 1996 for $3,000 and that he is entitled to immediate repayment of all sums withheld or recouped by DFAS.  The Board also finds it appropriate that all appropriate agencies be notified that the debt was erroneous and is voided.

5.  In view of the foregoing, the applicant’s records should be corrected as recommended below.

RECOMMENDATION:  That all of the Department of the Army records related to this case be corrected:

a.	by correcting the records of the individual concerned to show that he was enrolled in the RRMIIP in October 1996 for $3,000 and that he is entitled to immediate repayment of all sums withheld or recouped by DFAS. 

b.	 by taking the necessary steps to ensure that all appropriate agencies (government and civilian) are notified that the debt was erroneous and is voided.

BOARD VOTE:  

___le____  __js ____  ___reb __  GRANT AS STATED IN RECOMMENDATION

________  ________  ________  GRANT FORMAL HEARING

________  ________  ________  DENY APPLICATION

		_____John N. Slone______
		        CHAIRPERSON

INDEX

CASE ID	AR2000057966	
SUFFIX		
RECON	YYYYMMDD	
DATE BOARDED	2001/09/25	
TYPE OF DISCHARGE		
DATE OF DISCHARGE		
DISCHARGE AUTHORITY		
DISCHARGE REASON		
BOARD DECISION	GRANT	
REVIEW AUTHORITY		
ISSUES         1.  13	101.0000/RRMIIP	
2.  293	128.1000/REMI DEBT	
3.		
4.		
5.		
6.