PROCEEDINGS

	IN THE CASE OF:  

	BOARD DATE:           5 February 2002                   
	DOCKET NUMBER:   AR2001065097

	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	
	Mrs. Nancy Amos		Analyst	

  The following members, a quorum, were present:

	Ms. June Hajjar		Chairperson	
	Ms. Karol A. Kennedy		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)

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 that his College Access Loan be determined to be payable under the Loan Repayment Program (LRP).

3.  The applicant states that at the time he enlisted he provided a copy of all his promissory notes (four loans totaling about $52,000.00) to his recruiter.  His recruiter assured him that all his education loans would be repaid.  However, he later received notification that the College Access Loan would not be covered.

4.  The applicant’s military records show that he entered the Delayed Entry Program on 24 April 2000.  His DA Form 3286-59, Statement for Enlistment, United States Army Enlistment Program, U. S. Army Delayed Enlistment Program, and DA Form 3286-66, Statement of Understanding, United States Army Incentive Enlistment Program, show that he enlisted for the LRP up to a maximum repayment of $65,000.  On the DA Form 3286-66, he acknowledged that under the LRP the government would repay a designated portion of any loan he incurred that was made, insured or guaranteed under Part B of the Higher Education Act of 1965 or any loan under Part E of such act after 1 October 1975 and before he enlisted into the Regular Army.  

5.  The applicant enlisted in the Regular Army on 22 May 2000 for 5 years.  Prior to entry on active duty, he had obtained apparently four loans, one of which was a College Access Loan from the Texas Higher Education Coordinating Board in the amount of $10,000.00.

6.  The U. S. Total Army Personnel Command disapproved the College Access Loan because it was a state funded loan, not federally insured or subsidized and not authorized by the Higher Education Act of 1965, as amended.

7.  The applicant’s recruiter corroborated the applicant’s contention that all his promissory notes were brought to the Military Entrance Processing Station on his shipment day and that the Army Guidance Counselor approved all his loans as being repayable under the LRP.

8.  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 Loan 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 Loan.  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.  

9.  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.

10.  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.”

CONCLUSIONS:

1.  The evidence of record shows that the applicant enlisted for the LRP incentive on 24 April 2000.  He had obtained several student loans prior to his entry on active duty and they were not in default prior to his entry on active duty.  He provides a memorandum from his recruiter corroborating his contention that his Army Guidance Counselor approved all his promissory notes as being repayable under the LRP.  Based upon this information, the applicant enlisted in the Regular Army in good faith for 5 years believing all his loans qualified for repayment under the LRP.  He has since been informed that the College Access Loan in the amount of $10,000 does not qualify for repayment.

2.  The applicant’s military records may be corrected to show his DA Form   3286-66 was amended to include the sentence “If a student loan is accepted by the officials processing you for enlistment as payable under the LRP and the government fails to verify that the student loan accepted actually is eligible under the Higher Education Act of 1965 and such failure results in nonpayment of the loan by the LRP or the repayment or default of the loan, the Army Board for Correction of Military Records 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 institutions would have been paid under the LRP.

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

RECOMMENDATION:

1.  That the applicant’s DA Form 3286-66, Statement of Understanding, US Army Incentive Enlistment Program, be amended to include the sentence “If a student loan is accepted by the officials processing you for enlistment as payable under the LRP and the government fails to verify that the student loan accepted actually is eligible under the Higher Education Act of 1965 and such failure results in nonpayment of the loan by the LRP or the repayment or default of the loan, the Army Board for Correction of Military Records may pay the loan, at its sole discretion, in accordance with Title 10, U.S. Code, section 1552.”

2.  That as a result of the foregoing correction the Defense Finance and Accounting Service shall remit payment to the applicant of the total amount of his College Access Loan to which he is entitled as a result of this correction at the appropriate rate and time.  

BOARD VOTE:  

__jh____  __kak___  __rwa___  GRANT AS STATED IN RECOMMENDATION

________  ________  ________  GRANT FORMAL HEARING

________  ________  ________  DENY APPLICATION

			June Hajjar
		______________________
		        CHAIRPERSON

INDEX

CASE ID	AR2001065097	
SUFFIX		
RECON		
DATE BOARDED	20020205	
TYPE OF DISCHARGE		
DATE OF DISCHARGE		
DISCHARGE AUTHORITY		
DISCHARGE REASON		
BOARD DECISION	(GRANT)	
REVIEW AUTHORITY		
ISSUES         1.	128.00	
2.		
3.		
4.		
5.		
6.