RECORD OF PROCEEDINGS

	IN THE CASE OF:  

	BOARD DATE:  13 January 2004
	DOCKET NUMBER:  AR2003086544

	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	
	Ms. Joyce A. Wright		Analyst	

  The following members, a quorum, were present:

	Ms. Lana E. McGlynn		Chairperson	
	Mr. Patrick H. McGann		Member	
	Mr. Roger W. Able		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).

THE APPLICANT'S REQUEST, STATEMENT, AND EVIDENCE:  

1.  The applicant requests waiver of his debt to the government resulting from an overpayment of his basic allowance for housing (BAH). 

2.  The applicant states, in effect, that his BAH overpayment was caused by negligence on finance.

3.  The applicant provides a letter of explanation about the extenuating circumstances concerning the facts in his case and believes that it is not fair or right to penalize him.  He also provides several copies of his leave and earning statements (LES) and a letter from the Defense Finance and Accounting Service (DFAS), Denver Center.

CONSIDERATION OF EVIDENCE: 

1.   The applicant's military records show that he enlisted on 31 May 1972.  He continued to serve through a series of continuous reenlistments until he was placed on the Army of the United States Retired List, effective 30 November 2000, in the rank and pay grade of SGM/E-9.

2.  The applicant was charged Permissive Temporary Duty (PTDY) from 2 to 31 August 2000.  His terminal leave status began on 1 September 2000 and terminated on 30 November 2000.  

3.  On 13 January 2003, the Director of Debt and Claims Management, DFAS, Denver Center prepared a letter to the applicant.  It stated that this letter was in response to the applicant's inquiry regarding his debt.  He was informed that his debt was increased to $8,857.00, which was due to erroneous payment of     BAH-I, formerly consisting of entitlements for Basic Allowance for Quarter (BAQ) and Variable Housing Allowance (VHA) for Atlanta, Georgia, from 21 July to 30 November 2000.

4.  According to regulation, the applicant's last duty station was the basis for his  BAH-l entitlement.  Orders show that the applicant was assigned to Bamberg, Germany until his date of separation of 30 November 2000.  Since the applicant was not assigned in the continental US, he was entitled to BAH-II, formerly BAQ with dependent rate from 21 July to 30 November 2000.   

5.  They discovered that the applicant's October 2000 LES, BAH-I for 2 August through 30 September 2000, was recouped causing a debt in the amount of $2,174.54.  In November 2000, BAH-I was repaid to the applicant for the period 2 August to 30 November 2000, totaling $4,385.94, causing the applicant to receive a large mid-month and end-of-month (EOM) for November payment totaling $8,292.43 ($5,591.47 + $2,174.54).  The applicant enclosed Long-0641 Form (Actually Paid) that shows he was only entitled to receive pay of $6,117.99, leaving a debt of $2, 174.54 (debt from October 2000 was not deducted from the payments he received).

6.  Their review shows (as previously stated) that the applicant should not have been paid for BAH-I, but was entitled to BAH-II.  BAH-I was recouped in the amount of $1,105.70 (for the Atlanta area) from July 21, 2000 through November 30, totaling $4,792.67.  He was paid for BAH-II from July 21 through 30 November 2000, totaling $3,135.60, leaving him with a debt of $3,831.61 (-$2,174.54 - $4,792 +$3,135.60).  They also discovered that his Cost of Living Allowance (COLA) should have terminated on 25 July 2000 and was recouped from 26 July through 30 November 2000, totaling $737.33.

7.  His account was not closed until January 2001, causing Federal Income Tax Withholding in the amount of $436.69 for December 2000 and a December 2000 insurance allotment of $9.23 to be paid on his behalf.  This also caused him to be paid a mid-month and EOM December payments totaling $4,502.80.  He was refunded several miscellaneous deductions leaving him with a debt of $8,857.00.

8.  On 3 February 2003, the applicant responded.  He stated that he has attempted to resolve his debt prior to his retirement.  He also stated that DFAS may have over calculated the amount of overpayment by approximately $350.00 and failed to separate his account in time causing an erroneous mid-month and EOM December payment totaling $4,502.80.  He is requesting that he enter into a written agreement in accordance with regulation due to his debt.

9.  He was informed that the remaining amount that DFAS claimed he owes must be repaid due to erroneous payment of BAH.  His Long –0641 Form shows that DFAS overestimated his amount by $230.16 and that the actual amount due was $4,124.04 with payment of one more day of leave which decreased his amount owed to $3993.01.  He also explained in detail action taken to resolve his issue.  He has made repeated requests to DFAS subject matter experts to clarify this matter regarding his overpayment of BAH; however, they were unable to provide him with the correct information.  He states that he is now asking recovery of his erroneous BAH payments be waived according to regulation. 

10.  The applicant provides several copies of his LES's that show his overpayment of BAH.

11.  Department of Defense (DOD) Financial Management Regulation, Volume 7A, Chapter 26, Paragraph 260101A states that BAH is payable to members on active duty and will vary according to the grade in which serving or appointed for basic pay purposes, dependency status, and the permanent duty station (PDS) assigned.  Paragraph B states that a member's old PDS is the PDS for BAH purposes from the day the member departs the old PDS through the day before the member reports to the new PDS in compliance with permanent change of station (PCS) order (if the member had been residing in government quarters at the old PDS, the member is entitled to BAH the date of termination of government quarters).

12.  DOD Financial Management Regulation, Volume 7B, Chapter 28, paragraph 2805 authorizes the deduction from a member's pay of amounts that the Secretary of the Military Department concerned (or designee) administratively determines to be owed the US or any of it instrumentalities.  Subparagraph 280503 stated that the member should be provided the opportunity to request a written agreement with the Secretary of the Military Department concerned (or designee) under terms acceptable to both parties to establish a schedule for repayment of debt. 

13.  Subparagraph 280901 pertains to waiver of indebtedness.  It states that recovery of erroneous payments of pay and allowances to or on behalf of a member or former member of the Uniform Services, may be waived if recovery is determined to be against equity and good conscience.  Criteria are met by finding that:  (a) the erroneous payment occurred through administrative error; and (b) there is no indication of fraud, misrepresentation, fault or lack of good faith on the part of the respondent.

14.  Public Law 92-453 authorizes the waiver of erroneous payments of pay and allowances to former members or civilian employees.  This legislation does not allow relief because of financial hardship.  Also, the Comptroller General ruled that any debt resulting from a legal and proper payment may not be considered for waiver.

15.  Army Regulation 600-4 provides instructions for submitting and processing applications for remission or cancellation of indebtedness to the United States Army.  Applications must be based on injustice, hardship, or both.  This includes debts caused by errors in pay to or on behalf of a soldier.  

DISCUSSION AND CONCLUSIONS:

1.  The preponderance of evidence clearly confirms that the applicant was overpaid BAH-l from July 21 to 30 November 2000.  He was not entitled to be paid BAH-I for the Atlanta area while still assigned to his parent overseas unit in Bamberg, Germany.  His old PDS was his PDS for BAH purposes from the day he departed his old PDS through the day before termination of his terminal leave, which was also his effective date of retirement.

2.  The evidence shows that his account should have been closed out on 30 November 2000 instead of January 2001.  This error caused the applicant to be overpaid with a paid a mid-month and EOM payment for the month of December 2000.  However, the Board concluded that the applicant was a senior noncommissioned officer with lengthy experience and knew, or should have known, that he was not entitled to additional payments after his effective date of retirement, 30 November 2000.  Therefore, his debt is valid.   

BOARD VOTE:

________  ________  ________  GRANT RELIEF 

________  ________  ________  GRANT FORMAL HEARING

__lm___  ___pm__  __ra___  DENY APPLICATION

BOARD DETERMINATION/RECOMMENDATION:

The evidence presented does not demonstrate the existence of a probable error or injustice.  Therefore, the Board determined that the overall merits of this case are insufficient as a basis for correction of the records of the individual concerned.

		____Lana E. McGlynn___
		        CHAIRPERSON

INDEX

CASE ID	AR2003086544	
SUFFIX		
RECON		
DATE BOARDED	20040113	
TYPE OF DISCHARGE	HD	
DATE OF DISCHARGE	20001130	
DISCHARGE AUTHORITY	AR 635-200. chapter 12	
DISCHARGE REASON		
BOARD DECISION	DENY	
REVIEW AUTHORITY		
ISSUES         1.	293	
2.		
3.		
4.		
5.		
6.