MEMORANDUM OF CONSIDERATION

	IN THE CASE OF:   

	BOARD DATE:           14 February 2002                   
	DOCKET NUMBER:   AR2001064408

	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	
	Mrs. Nancy Amos		Analyst	

  The following members, a quorum, were present:

	Mr. John N. Slone		Chairperson	
	Ms. Barbara J. Ellis		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 he be paid the full amount of the Voluntary Separation Incentive (VSI) payment he was informed was due him.

APPLICANT STATES:  That he was informed that he would be paid an annual VSI payment of $11,376.02.  If he had known the amount he would be receiving would be only $8,283.36, he would not have given up 18 years of service for so small an amount.  

COUNSEL CONTENDS:  Counsel makes no additional contention.  However, in a 21 April 1999 response to the applicant, counsel informed him that although the military originally misinformed him concerning the amount of his benefits, it was not estopped to require him to complete the required number of active years of service.

EVIDENCE OF RECORD:  The applicant's military records show:

After having had prior service in the Army National Guard, he enlisted in the Regular Army on 22 April 1985.  He was promoted to Staff Sergeant, E-6 on       1 February 1993.

Around February 1998, the applicant was approved for separation under the Fiscal Year 1998 Enlisted Voluntary Early Release Program.  Around that time, a calculation of his estimated annual VSI annuity before taxes was prepared for him.  His base pay at the time he was due to separate was estimated to be $2,097.00.  It was estimated his annuity would be $11,376.02 before taxes.  He was informed that this was an estimate only and that finance would make the final calculation during his outprocessing.

The applicant was discharged on 1 April 1998 after completing 13 years, 2 months, and 26 days of creditable active service and over 18 years and 1 month of service for pay and transferred to a Reserve Component unit.  His Certificate of Release or Discharge from Active Duty, DD Form 214, item 18 shows he would receive a VSI payment of $8,283.36 for 36 years.  

The National Defense Authorization Act for Fiscal Year 1992 established voluntary incentive programs to support the Army drawdown.  The VSI was an annual annuity payment equal to 2.5 percent of the soldier’s annual basic pay multiplied by his years of service (fractions of years to be computed in accordance with Title 10, U. S. Code, section 1405), multiplied by 12 and paid for twice the number of years served.  Soldiers approved for VSI must have been 

appointed, enlisted, or transferred to the Ready Reserve for the entire period they received VSI annual payments.  The formula for calculating the annuity was given in the Fiscal Year 1998 Enlisted Voluntary Early Release Program implementing message.

The applicant’s base pay at the time he was due to separate was estimated to be $2,097.00 x .025 = 52.425 x 18 = 943.65 x 12 = $11,323.80 (or, with the fraction of his year included, approximately $11,376.02).  The Defense Finance and Accounting Service – Cleveland Center stated that Federal taxes are deducted before annual VSI payments are made and that the current tax rate is approximately 27 or 28 percent.  The difference between $11,376.02 and $8,283.36 is $3,092.66, approximately 27 percent of $11,376.02.

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.  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.

2.  When the applicant’s VSI calculations were made, he was informed that the $11,376.02 amount was the estimated annual annuity before taxes.  It appears that the $8,283.36 he is actually receiving is the annuity after taxes.  He could have calculated his estimated annuity based upon the guidance given in the implementing message prior to submitting his request for early separation and he could have then contacted his finance office or the nearest Internal Revenue Service office to determine what the tax on his estimated VSI payment would be. 

3.  The applicant provides no evidence to show that the $8,283.36 amount he is receiving is also before taxes and that further Federal taxes are being deducted.  

4.  The Board also notes that the applicant did not have 18 years towards a length of service retirement; he had a little over 13 years towards a length of service retirement.

5.  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

__jns___  __bje___  __jed___  DENY APPLICATION

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

INDEX

CASE ID	AR2001064408	
SUFFIX		
RECON		
DATE BOARDED	20020214	
TYPE OF DISCHARGE		
DATE OF DISCHARGE		
DISCHARGE AUTHORITY		
DISCHARGE REASON		
BOARD DECISION	(DENY)	
REVIEW AUTHORITY		
ISSUES         1.	128.00	
2.		
3.		
4.		
5.		
6.