I can't speak for how it works with the new curriculum, but usually 2 failed classes in the same tri will result in a set back. The fact that they are STCW (or not) doesn't matter that much because you still have to get them made up. Everyone in my class who failed more than 1 class first tri plebe year was offered a set back, 4 of the 5 are on track to graduate with 2016, and the fifth elected not to return.
Again this is all anecdotal evidence but the folks in Wiley hall seem to swing on a pendulum about how to handle people who fall behind academically. Starting in 2011/2012 the trend seemed to be headed towards the administrators favoring dis-enrollment. There were more midshipmen then racks because of barracks renovation and there were two new sheriffs in town who needed to set a standard. When 2013 B returned from from second sailing the dis-enrollment thing seemed to hit critical mass, lots of people seemed to fail two projects and get dis enrolled. Some surmised that MARAD was unhappy with the number of people who got the boot three years in, and as a result have pressured the academy to try and use the setback/deferred grad program, which seems to be the result for most.
LT Acquaro in the ACE will be a great resource in helping navigate this process, he has helped many midshipmen, usually with a positive result.
Again. All anecdotal. Without knowing the specifics I would likely say set back. Get your son home, get started in the spring semester at community college, and kick tail. This adversity isn't impossible to overcome. Keep running scared like the grim reaper is a step behind you.
