Pro-Rated Debt for Withdrawing

[considering_it]

Hello,

I have a question about paying back debt after having left SMART during your Phase 2 (before your commitment ends). If you have left and gone through this process please let me know!

The SMART Scholar Handbook says that any debt owed will be PRO-RATED according to the time that you have served in your Phase 2 commitment (pg 19):

a) Establishment of Monetary Debt: The DoD Component determines the scholar is
obligated to monetarily refund the United States for failure to complete the program
under the terms of the SSA. For scholars who have partially completed their service
commitments, the amount of the debt is pro-rated according to the amount of time
served.

Given this I assume it is a simple pro-rating, calculated using either the day, month, or pay periods served in the commitment.

I am nearing the end of my 2 year commitment this July, but am applying for other jobs, some of which want to hire sooner. I am considering withdrawing from the program and taking the pro-rated debt in the case that the right opportunity arises. However, SMART explicitly cannot project or offer estimates of potential debt if you were to withdraw, per the handbook pg 18:

Thus, the SMART Program Support Team (including SC,
CL, or any other employee of the Program Support Team) are not able or authorized to project
specific outcomes of debt establishments.


I want to verify an estimate of how much I would owe before I make any decisions, so I wanted to ask if anyone here has left the program, and if so what was the process like?
Was the debt actually pro-rated?
If so to what level? To the day, month, or pay-period?

My concern is it will be pro-rated to the YEAR so I would owe HALF of all my award money even though I might have only a few months left when I leave for another offer.

For example, say my Grand Total award was $180,000 for a 2 year (731 day) commitment, and I left with 90 days left on the commitment, would the debt owed be (more or less) 180k * (90/731) = ~$22k?

Any personal experience or knowledge would be helpful (it's so dumb that SMART can't tell us what the debt owed would be at any give time). Thank you!

[drewkuz]

I'm in a similar situation and this is the answer i received today:

"The total funds expended on your behalf under your SMART scholarship award is $128,450.12.  I am unable to tell you at this time exactly how much you would owe, as this is a decision of your sponsoring DoD Component, not the SMART Program Support Team. Furthermore, the total amount owed may or may not be equal to the total amount expended on your behalf.  Since you have completed some of your service commitment, the amount you owe will be prorated based on time served. You can calculate an estimate of what you may owe based on the length of time you have been in phase 2, however the final amount is only determined by your DoD Component. If you choose to withdraw, instructions for repaying any and all amounts will be provided to you by the DoD Component at a later date. "

[considering_it]

I'm in a similar situation and this is the answer i received today:

"The total funds expended on your behalf under your SMART scholarship award is $128,450.12.  I am unable to tell you at this time exactly how much you would owe, as this is a decision of your sponsoring DoD Component, not the SMART Program Support Team. Furthermore, the total amount owed may or may not be equal to the total amount expended on your behalf.  Since you have completed some of your service commitment, the amount you owe will be prorated based on time served. You can calculate an estimate of what you may owe based on the length of time you have been in phase 2, however the final amount is only determined by your DoD Component. If you choose to withdraw, instructions for repaying any and all amounts will be provided to you by the DoD Component at a later date. "

Did this come from your SMART Liason? Gosh what a nothing answer. What do you mean it's pro-rated but also the final amount is only determined by them? I know it's just covering their ass but still. From everything I've seen other people say it looks like it is pro-rated, but I'm trying to see if anyone else can shed light on to what level.

In the recent OPM Memo email they sent out to all scholars they did say this:

Note that per your SMART service agreement, if you do not complete your service commitment, you will be subject to a debt to the U.S. government. Debt owed is calculated based on the date you leave the SMART Program and educational funding expensed on your behalf. For scholars who have partially completed their service commitment, the amount of debt is pro-rated according to the amount of time served.

I feel like that is pretty clear cut saying it is pro-rated...

[drewkuz]

this was the answer from my liason.... nobody wants to give us a clear answer because no one knows what is going on.

i suspect it is prorated, like you are thinking, and in my case i would owe 23% (30K) of my commitment. for my calculation, i'm using 1oct2025 to the end of my anticipated completion of phase 2.

if the government decides not to hold up their end of the bargain, and stop paying us, i'm pretty sure there is nothing we could do about it.

[Phase 2 Scholar]

OPM circulated a template contract to agencies that can be used to document employee resignations and formalize the government's agreement to abide by the terms of the deferred resignation program. The template contract contains the following provision:

"[AGENCY] agrees to waive any debt owed by Employee to [AGENCY] pursuant to a recruitment incentive, student loan repayment, or other service agreement. [AGENCY] also agrees to waive any remaining service requirements from taking paid parental leave."

It's unclear whether this applies to the SMART program, and another provision that waives your right to sue if they don't follow through:
"Employee forever waives, and will not pursue through any judicial, administrative, or other process, any action against [AGENCY] that is based on, arising from, or related to Employee’s employment at [AGENCY] or the deferred resignation offer, including any and all claims that were or could have been brought concerning said matters."

Maybe if you resign tomorrow, you can dodge the debt altogether.