
From the U.S. Code Online via GPO Access
[wais.access.gpo.gov]
[Laws in effect as of January 23, 2000]
[Document not affected by Public Laws enacted between
  January 23, 2000 and December 4, 2001]
[CITE: 38USC7675]

 
                      TITLE 38--VETERANS' BENEFITS
 
              PART V--BOARDS, ADMINISTRATIONS, AND SERVICES
 
     CHAPTER 76--HEALTH PROFESSIONALS EDUCATIONAL ASSISTANCE PROGRAM
 
          SUBCHAPTER VI--EMPLOYEE INCENTIVE SCHOLARSHIP PROGRAM
 
Sec. 7675. Breach of agreement: liability

    (a) Liquidated Damages.--A participant in the Program (other than a 
participant described in subsection (b)) who fails to accept payment, or 
instructs the educational institution in which the participant is 
enrolled not to accept payment, in whole or in part, of a scholarship 
under the agreement entered into under section 7603 of this title shall 
be liable to the United States for liquidated damages in the amount of 
$1,500. Such liability is in addition to any period of obligated service 
or other obligation or liability under the agreement.
    (b) Liability During Course of Education or Training.--(1) Except as 
provided in subsection (d), a participant in the Program shall be liable 
to the United States for the amount which has been paid to or on behalf 
of the participant under the agreement if any of the following occurs:
        (A) The participant fails to maintain an acceptable level of 
    academic standing in the educational institution in which the 
    participant is enrolled (as determined by the educational 
    institution under regulations prescribed by the Secretary).
        (B) The participant is dismissed from such educational 
    institution for disciplinary reasons.
        (C) The participant voluntarily terminates the course of 
    education or training in such educational institution before the 
    completion of such course of education or training.
        (D) The participant fails to become licensed to practice 
    medicine, osteopathy, dentistry, podiatry, or optometry in a State, 
    fails to become licensed as a registered nurse in a State, or fails 
    to meet any applicable licensure requirement in the case of any 
    other health-care personnel who provide either direct patient-care 
    services or services incident to direct patient-care services, 
    during a period of time determined under regulations prescribed by 
    the Secretary.
        (E) In the case of a participant who is a part-time student, the 
    participant fails to maintain employment, while enrolled in the 
    course of training being pursued by the participant, as a Department 
    employee.

    (2) Liability under this subsection is in lieu of any service 
obligation arising under a participant's agreement.
    (c) Liability During Period of Obligated Service.--(1) Except as 
provided in subsection (d), if a participant in the Program breaches the 
agreement by failing for any reason to complete such participant's 
period of obligated service, the United States shall be entitled to 
recover from the participant an amount determined in accordance with the 
following formula:

                                                           t-s

                                             A=3<greek-PH>  ( ---- )

                                                            t

    (2) In such formula:
        (A) ``A'' is the amount the United States is entitled to 
    recover.
        (B) ``<greek-PH>'' is the sum of--
            (i) the amounts paid under this subchapter to or on behalf 
        of the participant; and
            (ii) the interest on such amounts which would be payable if 
        at the time the amounts were paid they were loans bearing 
        interest at the maximum legal prevailing rate, as determined by 
        the Treasurer of the United States.

        (C) ``t'' is the total number of months in the participant's 
    period of obligated service, including any additional period of 
    obligated service in accordance with section 7673(c)(2) of this 
    title.
        (D) ``s'' is the number of months of such period served by the 
    participant in accordance with section 7673 of this title.

    (d) Limitation on Liability for Reductions-in-Force.--Liability 
shall not arise under subsection (b)(1)(E) or (c) in the case of a 
participant otherwise covered by the subsection concerned if the 
participant fails to maintain employment as a Department employee due to 
a staffing adjustment.
    (e) Period for Payment of Damages.--Any amount of damages which the 
United States is entitled to recover under this section shall be paid to 
the United States within the 1-year period beginning on the date of the 
breach of the agreement.

(Added Pub. L. 105-368, title VIII, Sec. 802(a), Nov. 11, 1998, 112 
Stat. 3355.)
