MEMORANDUM OF CONSIDERATION

	IN THE CASE OF:  

	BOARD DATE:  13 September 2001
	DOCKET NUMBER:  AR2001059257

	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. Joyce A. Wright		Analyst	

  The following members, a quorum, were present:

	Mr. Fred N. Eichorn		Chairperson	
	Mr. Terry L. Placek		Member	
	Mr. John E. Denning		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)

APPLICANT REQUESTS:  That the Army repay his student loans or separate him from service.

APPLICANT STATES:  That he was counseled prior to his enlistment by his recruiters that his student loans would be repaid by the Army under the Loan Repayment Program (LRP); however, he has now been informed that his student
loans do not qualify under the LRP.

EVIDENCE OF RECORD:  The applicant's military records show he enlisted on 24 May 1999 as a air traffic control operator (93C) for a period of 5 years.  He continues to serve and is presently assigned to Company C, 1st /58th Aviation Battalion, 159th Aviation Brigade, Fort Campbell, Kentucky.

The applicant’s DA Form 3286-66 (Statement of Understanding/United States Army Incentive Enlistment Program), item 1(a) shows that the applicant enlisted for the LRP.  Item 4 shows the entry “I understand that I must DISENROLL from the GI Bill in order to qualify for this program.  DISENROLLMENT MUST BE ACCOMPLISHED at the time I enter on active duty.  If I fail to complete the disenrollment portion of the DD Form 2366, I will not be eligible for the LRP and will become automatically enrolled in the GI Bill.  Not to Exceed 65,000.”

Item 4(a) states “I understand that under this program (LRP) that the government will repay a designated portion of any loan I 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 I enlist into the Regular Army.”  

The applicant’s records contain a copy of a DD Form 2366 (Montgomery GI Bill Act of 1984 (MGIB)), dated 24 May 1999, which was authenticated in his own hand, and shows the entry “I understand that I am enlisting for the LRP, therefore, I am disenrolling from the MGIB.”

The applicant provided three statements of accounts pertaining to his student loans.

The applicant provided a copy of a letter from the US Total Army Personnel Command (PERSCOM), Education Division, dated 10 January 2001, to a Member of Congress.  This letter was written in regards to the Congressman’s inquiry of 30 November 2000.  The letter stated that individuals enlisting with the LRP as a part of their enlistment contract must meet certain eligibility criteria.  Part of the eligibility criteria is to have loans that qualify under the LRP.  Loans 

eligible for repayment under the LRP are Stafford, Perkins, Parent Loans for Undergraduate Students, Supplemental loans, or any loan made, insured, or guaranteed under the Higher Education Act of 1965, Title IV, Part B, D, or E.  Payment toward loans that do not qualify under the LRP are in violation of the law governing this program.  There are no exceptions to the law.  The applicant’s loans do not qualify for repayment under the LRP and we regret that the applicant was misled.

On 6 September 2001, the Education Incentive and Counseling Branch provided a copy of a letter that was forwarded to the applicant on 7 March 2000.  Attached were three DD Forms 2475 (Department of Defense (DOD) Educational Loan Repayment Program (LRP)) with enclosures.  The letter was written in regards to his DD Forms 2475 and his promissory note received from Wells Fargo 
Education Financial Services.  According to the terms outlined in the applicant’s contract, the DA Form 3286-66 (Statement of Understanding US Army Incentive Enlistment Program), Section 4, item a, states, “I understand that under this program (LRP) that the government will repay a designated portion of any loan 
I 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 I enlist into the Regular Army.”  Public Law 99-145, section 671(a)(1), confirms that loans eligible for repayment must be made under Title IV, Part B, D, or E of the Higher Education Act of 1965.  This letter stated that upon receipt of the promissory note from Wells Fargo Educational Financial Services, it was determined that the applicant’s loans did not qualify for repayment under the LRP.  It was also determined that the applicant’s loan was a loan under the Norwest Collegiate Loan Program (NCLP), which was not made, insured, or guaranteed under Title IV Part B, D, or E of the Higher Education Act.

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 Loans 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 Loans.  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.
DISCUSSION:  Considering all the evidence, allegations, and information presented by the applicant, together with the evidence of record, applicable law and regulations, it is concluded:

1.  The evidence of record shows that the applicant enlisted under the LRP and 
had acquired three student loans prior to his entry on active duty.  The evidence of record also notes that the applicant signed his addendum to his MGIB Enlistment Contract attesting to the fact that he was disenrolled from the MGIB.

2.  The Board notes that a DD Form 2475 was provided to the applicant from the Chief, Education Incentives Counseling Branch.  This form was mailed to the Wells Fargo Education Financial Services for loan status confirmation and was returned to the Chief, Education Incentives Counseling Branch for final determination.  However, upon receipt of the promissory note from the Wells Fargo Education Financial Services, the Chief, Education Incentives Counseling Branch determined that the applicant’s loans did not qualify for repayment under the LRP. The Board also notes that the applicant’s promissory note indicated that the applicant’s loan was a loan under the NCLP, which is not made, insured or guaranteed under Title IV, Part B, D, or E of the Higher Education Act. Therefore, the Army is not authorized to repay the applicant’s student loan.

3.  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.

4.  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

__fe___  __tp____  __jd____  DENY APPLICATION

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

INDEX

CASE ID	AR2001059257	
SUFFIX		
RECON		
DATE BOARDED	20010913	
TYPE OF DISCHARGE		
DATE OF DISCHARGE	ACTIVE DUTY	
DISCHARGE AUTHORITY		
DISCHARGE REASON		
BOARD DECISION	DENY	
REVIEW AUTHORITY		
ISSUES         1.  1026		
2.		
3.		
4.		
5.		
6.