According to the agreement, he was to serve two years in the service and get $20,100 from the Army to go back to college. He would have $2,400 deducted from his paychecks at $100 a month for his two-year stint. At the end of his service, the government would kick in $17,700.
Knauss was a good soldier, according to his discharge records. He chauffeured the company commander for more than a year and then moved German dirt in a dump truck for the rest of his tour. Jay earned a good conduct medal, overseas service medal and various other awards while in Baumholder, West Germany. He was honorably discharged April 15, 1987.
Before returning home, he decided to take one last European holiday. One week into his leave, however, Knauss ran out of money. His last paycheck had not been deposited into his account. He spent the last days of his leave time untangling Army red tape trying to figure out what happened.
The payroll department had tried to deposit his check into his bank account, but somehow the account was closed two weeks before his discharge. The check, amounting to approximately $600, was sent back to the military. After some checking, the company commander signed a pay inquiry which stated his soldier had not been paid. It seems that someone somewhere had mistakenly scheduled his discharge date prematurely.
When he got back to the States, the paycheck debacle spiraled. He was informed at Fort Jackson, Arkansas, that he was $200 short to complete his education benefits' contribution. He paid the $200 despite explaining his paycheck problem. At other times in the next three months, the Army would claim he was $100 short or $200 over in his payment plan. The Army, it seemed, didn't have a clue as to what had happened.
Knauss returned to Arizona and signed up for fall 1987 classes at ASU. The local Veterans Administration, which doles out the benefits, told him there would be no problem getting his college money, but a six- to eight-week wait would be necessary for the program to kick in. So, he took out a temporary loan to cover books and tuition until the money flowed.
Eight weeks came and went; the money never came. He went back to the VA. Staffers said they would put a tracer on the check and it would probably be another six to eight weeks. Knauss recalls: "They kept telling me, `The money's coming anytime now.'"
By the end of the semester, Knauss was getting desperate for money. He hocked almost everything he owned, again borrowed from family and friends and even sold his U.S. savings bonds, which he had bought while serving his country.
"I didn't have much money--even to live," he recalls. Finally, Knauss went to Senator John McCain's office for help. "Just before Christmas," he recalls, "I got a check for $180. I was expecting to get $2,400."
Broke and dejected, Knauss sold the last thing he owned--his military assurance policy, which was an annuity he was paying $50 a month on. The ten-year savings plan would have given him $200,000 at the end of the policy.
He enrolled in one class and got an art gallery job. It wasn't until October 1988, twenty months after applying, that the VA finally acknowledged his benefits and put him on a regular payment schedule.
Knauss earned a fine arts degree and returned to add a degree in political science. He wasn't a great student. B's and C's cover his transcript. Similar to his Army performance, he did his job.
But he was fighting a two-front war. The Army's collection agency was still hounding him about the $600 paycheck he had never received.
In September 1987, four months after the Army acknowledged they had not paid him for his last month of service, the U.S. Army Finance and Accounting Center had demanded the $600 back. Knauss tried to explain, but no one listened. He received bills with no phone numbers to call, no names of people to ask for.
The Army apparently didn't believe him. Knauss says the letters painted him as a manipulative thief trying to hustle the military out of a few bucks. He was vexed by what he believed was the Army collection agency's attitude of guilty even when proven innocent. "There is no way I should be tied to that money in any way, shape or form," Knauss says angrily.
He sent the Army his pay vouchers, W-2 tax forms, his commanding officer's statement, bank statements and other documents to show he had never received the $600 paycheck.