(a) General rule.--A recipient of a stipend or other incentive payment under this subchapter who fails to complete his service obligation or to meet other requirements established by the Adjutant General is liable to the Commonwealth for repayment of all incentive payments made. The Adjutant General shall notify the department if the recipient fails to complete the service obligation, and the promissory note under section 3215 (relating to promissory note) shall be called to secure payment in full upon demand on a schedule as the department may determine.

(b) Forgiveness of recoupment.--The Adjutant General may forgive recoupment of all or part of a recipient's stipend or other incentive payment if the Adjutant General determines that his failure to fulfill the service obligation was the result of his death, discharge because of disability incurred in line of duty, discharge because of a medical determination that he is medically unfit for duty when the medical condition is outside his control and is not due to his misconduct, mandatory discharge, release or retirement for age or years of service or discharge, release, transfer or retirement because of other compelling circumstances outside his control.