NVLSP

Released 4/30/20 | Tags:

What COVID-19-related economic assistance is available for veterans?

There are several assistance programs administered by the federal government, state governments, and non-profit organizations designed to help veterans suffering from economic hardship due to COVID-19.  The federal government has also created multiple programs to assist small businesses, which are available to veteran small business owner

• I. Economic Assistance for Individual

A. CARES Act Stimulus Payments

The recent CARES Act provides federal funds designed to help individuals in light of the COVID-19 pandemic.  An individual whose adjusted gross income is less than $99,000 is eligible for a stimulus payment up to $1,200, plus $500 for qualifying dependents.  Please see our guidance on CARES Act stimulus payments for more information, available at: www.nvlsp.org/news-and-events/press-releases/nvlsp-fact-sheet-of-covid-19-cares-act-program.

B. Disabled American Veterans COVID-19 Unemployment Relief Fund

Disabled American Veterans (DAV) created its COVID-19 Unemployment Relief Fund to provide help to service-connected disabled veterans who have lost employment.  Funds are distributed as grants for up to $250 per household.

1. Am I eligible?

All service-connected disabled veterans who have lost employment as a direct result of the COVID-19 pandemic are eligible for the DAV COVID-19 Unemployment Relief Fund, including veterans who are self-employed.  You do not need to be a DAV member to apply.  However, the relief fund is available to only one disabled veteran per household.

2. How can I apply?

DAV is only accepting online applications through its website at https://thedav.wufoo.com/forms/q1078og50y99123/.  To apply, you will need to submit verification of status as a service-connected disabled veteran. DAV recommends submitting a copy of a valid VA identification card, proof of service connection from eBenefits, or a VA letter.  You will also need to submit verification of unemployment such as a termination letter or document(s) showing you have applied for unemployment benefits.  If you are self-employed, you will need to instead submit proof of lost income.

3. Where can I find more information about the program?

Visit the Disabled American Veterans COVID-19 Unemployment Fund information page at https://www.dav.org/COVIDrelief/.

C. Wounded Warrior Project COVID-19 Relief Program

The Wounded Warrior Project has established a $10 million COVID-19 Relief Program to help meet the immediate needs of warriors who are in urgent and significant financial crisis due to the loss of household income caused by the coronavirus pandemic.  Funds are distributed as grants of $1,000 per household.

1. Am I eligible?

Currently, the program is only open to persons registered with the Wounded Warrior Project (WWP) on or before April 8, 2020.  To apply, you must have suffered a loss of employment or work income, or be dependent on someone in your household who has suffered a loss of income due to the COVID-19 pandemic.  WWP also requires that you are currently unable to pay for rent, mortgage, utilities, or food.

2. How can I apply?

If you were registered with WWP on or before April 8, 2020, you would have received an email from covidgrantapp@woundedwarriorproject.org with a link to a grant application on or around April 9, 2020.  If you were registered and do not see the email, please look to your spam, junk, promotions, or similar folders.  The email contains directions on how to apply.

If you were not registered with WWP on or before April 8, 2020, you are not currently eligible for the COVID-19 Relief Program.  If the eligibility criteria changes, we will revise this guidance to reflect the new requirements.

3. Where can I find more information about the program?
Visit the Wounded Warrior Project’s COVID-19 Relief Program information page at https://www.woundedwarriorproject.org/covid-relief.

D. PenFed Foundation COVID-19 Emergency Financial Relief Program (Currently Suspended)

The PenFed Foundation’s COVID-19 Emergency Financial Relief Program was created to provide financial assistance to all veterans who are experiencing financial setback due to the negative economic effects of the COVID-19 pandemic.  Due to an overwhelming number of applications, the program is currently suspended.  We will monitor the status and revise this guidance if the PenFed Foundation resumes accepting applications.  You may visit PenFed’s information page for this program at https://penfedfoundation.org/apply-for-assistance/coronavirus-emergency-financial-assistance/.

E. Indiana Department of Veterans Affairs Military Family Relief Fund COVID-19 Special Application

The state of Indiana has created a special COVID-19 Emergence Assistance Program as part of its already well-established Military Family Relief Fund (MFRF).  This MFRF program is available to Indiana residents only.  It provides for grants of up to $2500 to assist military families with essential household expenses.

1. Am I eligible?

In order to be eligible for Indiana’s program, you must satisfy each of the following criteria:

• Indiana resident;
• Veteran or active service member with 12 months of qualifying military service;
• Discharge under honorable conditions (veterans only);
• Experiencing a hardship that is a “reasonable and logical consequence of the COVID 19 Virus Emergency,” including an interruption of employment income; and
• Federal gross income not more than 2 times the U.S. Federal poverty guidelines.

For Indiana, the federal poverty guidelines are as follows:

Additionally, this special COVID-19 fund is exempt from the standard MFRF lifetime maximum.  As such, even if you have previously received a MFRF award that was not related to COVID-19, you may still be eligible for this special COVID-19 MFRF award.

2. How can I apply?

The application is available at https://www.in.gov/dva/files/MFRF_COVID_19_app-outline.pdf.  There are several documents in the application and you will need to complete all of them.  Additionally, veterans will need to provide the following:

• DD-214 or NGB 22;
• Statement letter signed by the veteran explaining your situation and how the COVID 19 VIRUS contributed to your current hardship;
• 2 months of current bills, invoices, estimates, and similar documents supporting the information included in the application;
• The most current bank statements for all household

• Evidence of income for you and your spouse (pay stubs, VA compensation, SSA, retirement, cash assistance, unemployment, etc.);

• Evidence of your assets; and

• Receipts from previous relief fund awards.

3. Where can I find more information about the program?

All information about this program is contained in the application, available at https://www.in.gov/dva/files/MFRF_COVID_19_app-outline.pdf.  However, if you have questions that the application does not address, the application’s first page lists contact information for the Indiana Department of Veterans Affairs, which is available to assist you.

F. Minnesota Department of Veterans Affairs: COVID-19 Disaster Relief Grant and COVID-19 Special Needs Grant

The Minnesota Department of Veterans Affairs has two different grants available to resident veterans or their surviving spouse:  (1) the Disaster Relief Grant; and (2) the Special Needs Grant.  The eligibility criteria are generally the same for both programs.

The Disaster Relief Grant (DRG) is a one-time $1,000 grant paid directly to a veteran or their surviving spouse.  For the DRG, if two veterans are married, both can apply for and receive a $1,000 grant.
The Special Needs Grant (SNG) is a one-time grant, up to $3,000, paid directly to creditors or vendors of the veteran or their surviving spouse.  For the SNG, if two veterans are married, only one may receive a grant, regardless of the amount.  The SNG must be paid to creditors or vendors for expenses incurred on or after March 13, 2020, and can be used only for the following items:

• Rent/mortgage/contract for deed
• Security deposits
• Property taxes
• Home repairs (related to habitability)
• Furnace/AC unit
• Major appliances
• Utility bills
• Medical bills
• Auto repairs, insurance, or loan payments

1. Am I eligible?
Only Minnesota residents are eligible.  Any veteran or their surviving spouse (who has not remarried) may apply if they have suffered a negative financial impact from COVID-19.  Applicants must be able to demonstrate that their financial impact stems from COVID-19.  They must also show that their situation matches one of the following descriptions:

1. The applicant or their legal dependent have/had a confirmed case of COVID-19;

2. A healthcare provider has determined that the presence of the applicant or their spouse in the workplace would jeopardize their own health or the health of others because of likely exposure to COVID-19;
3. A healthcare provider has determined that the health of the applicant or their spouse was jeopardized because of a diagnosed underlying health condition(s) which would have put them at an increased risk if exposed to COVID-19 in the workplace;
4. The applicant is or was under legal isolation or legal quarantine (Minn. Stat. 144.419) related to a diagnosis of COVID-19 or they are/were caring for a dependent under legal isolation or legal quarantine;
5. The applicant, or their spouse’s, employer directs them not to report to work for COVID-19-related reasons;
6. The applicant, or their spouse’s, workplace is closed for COVID-19-related health and safety reasons and they are excused from work duties and cannot be reassigned; or
7. The applicant is financially impacted by a school or care provider closure due to COVID-19.

Visit the websites listed below (in the section entitled “Where can I find more information?”) for examples of documents you can use to support eligibility under one or more of the above criteria.

2. How can I apply?

For the SNG, you must apply through your County Veterans Service Officer (CVSO).  You can find your CVSO by visiting https://www.macvso.org/finda-cvso.html.  If your County Veterans Service Office is unable to assist you, please contact the Minnesota Department of Veterans Affairs at FO.MDVA@state.mn.us.

For the DRG, you can download an application from the Minnesota Department of Veterans Affairs at http://minnesotaveteran.org/CovidRelief.  The application can be submitted online through Minnesota’s GI Bill portal at https://gibill.mn.gov/ or through your CVSO.  You will also need to submit your DD-214, military discharge papers or equivalent, proof of Minnesota residency, and documentation supporting your eligibility.

3. Where can I find more information?

Information about both programs is available at http://minnesotaveteran.org/CovidRelief.  Additionally, an overview of the SNG is available at
https://mn.gov/mdva/assets/2020-04-03-covid-19-special-needs-grant-overview_tcm1066-426399.pdf, and an overview of the DRG is available at
https://mn.gov/mdva/assets/2020-04-03-covid-19-disaster-relief-overview_tcm1066-426398.pdf

II. Economic Assistance for Small Business Owners

The recent CARES Act created several programs to assist small business owners with their economic needs during the COVID-19 pandemic.  The major provisions include:

1.  A Payroll Protection Program that provides forgivable loans to small businesses to enable them to retain their employees and cover payroll expenses;

2.  Economic Injury Disaster Loans that enable small businesses to obtain an emergency grant of up to $10,000 that need not be repaid and to borrow up to $2 million; and

3.  Employee Retention Credits, which are refundable payroll tax credits for employers whose operations have been suspended by a government order or who have experienced significantly reduced receipts from the previous year. The credits are equal to 50% of qualified wages paid to each retained employee (up to a maximum of $10,000 per employee).

Each of these programs is further explained below.  For additional information on how the CARES Act affects small businesses, see the Senate Committee on Small Business & Entrepreneurship’s Small Business Owner’s Guide to the Cares Act at: https://www.sbc.senate.gov/public/_cache/files/2/9/29fc1ae7-879a-4de0-97d5-ab0a0cb558c8/1BC9E5AB74965E686FC6EBC019EC358F.the-small-business-owner-s-guide-to-the-cares-act-final-.pdf.

To help you decide which program(s) are best suited to your business, we recommend you consult the Small Business Administration (SBA), your small business lender, a certified financial planner, or an accountant.

A. Paycheck Protection Program: Forgivable Loans from the U.S. Small Business Administration
The Paycheck Protection Program (“PPP”) is a centerpiece of the CARES Act.  The program provides forgivable loans to small businesses.  Although PPP loans are administered by the U.S. Small Business Administration (the “SBA”), they are originated by third-party lenders.  Under the PPP, eligible small businesses can receive a forgivable loan of up to $10 million.

1. Am I eligible?

To be eligible for a PPP loan, an applicant generally must have fewer than 500 employees whose principal place of residence is in the United States, but for companies in industries where the SBA has an established eligibility threshold higher than 500 employees, that higher threshold will apply.   Alternatively, otherwise ineligible business can also qualify for a PPP loan as a “small business concern” if it meets both tests in SBA’s “alternative size standard” as of March 27, 2020: (1) maximum tangible net worth of the business is not more than $15 million; and (2) the average net income after Federal income taxes (excluding any carry-over losses) of the business for the two full fiscal years before the date of the application is not more than $5 million.2

Certain self-employed individuals are also eligible for PPP loans. Individuals with self-employment income (such as an independent contractor or a sole proprietor) (i) must have been in operation on February 15, 2020; (iii) have a principal place of residence is in the United States; and (iv) filed or will file a Form 1040 Schedule C for 2019.3  Special rules apply for partnerships.4

2. What are the terms of the PPP loan?

The total loan amount is calculated by determining your company’s average monthly payroll costs over the prior 12-month period, and then multiplying that number by 2.5.  Payroll costs include salary, wage, commission and tips, as well as vacation, medical, parental and sick pay.  It also includes payment for group healthcare benefits, including insurance premiums paid, employer and employee contributions to a 401(k)  or similar company retirement plan, and state and local payroll taxes.

The interest rate for the loan is fixed at 1% for a two-year term.  No collateral or personal guarantee is required to obtain the loan, and there is no prepayment penalty.

However, the federal government will forgive the full loan amount after an 8-week period if:  (1) 75% of the loan proceeds have been used to cover payroll or employee benefits; and (2) and there has been full employee retention (i.e., the business does not lay off or furlough any employees).  Nonetheless, small business owners may also use the loan proceeds to pay for other enumerated business expenses such as rent, utilities, and interest on mortgage and debt obligations.6 Companies may receive only partial forgiveness based on any reduction in employee compensation and/or reduction in the number of employees retained during the 8-week period.7

Footnotes:

1 Industry-specific employee thresholds can be found at https://www.sba.gov/document/support--table-size-standards

2 See Business Administration, Paycheck Protection Program Loans Frequently Asked Questions (FAQs): pages 1-2, Question 2.
3 See the SBA Third Interim Final Rule for more details regarding eligibility of individuals with income from self-employment, available at:  https://www.sba.gov/sites/default/files/2020-04/Interim-Final-Rule-Additional-Eligibility-Criteria-and-Requirements-for-Certain-Pledges-of-Loans.pdf.
4 See footnote 3.
5 This does not apply to Roth contributions or other after-tax contributions made by an employee.
6 Note that some commentators disagree whether 75% of total loan proceeds must be used for payroll to be eligible for any forgiveness or whether only 75% the portion of the loan forgiven must be used for payroll.  For example, if a business obtains a PPP loan for $15,000, spends $7,500 on payroll, and $7,500 on other expenses eligible for forgiveness such as rent and utilities, these two interpretations lead to drastically different results.  Under the first, none of the loan is forgiven because only 50% was used for payroll.  Under the second, $10,000 of the loan is forgiven because 75% of $10,000 was used for payroll and at least $2,500 was used for other eligible expenses.  The SBA has said it will issue further guidance on loan forgiveness, which will hopefully resolve this controversy.  Our guidance here reflects the first interpretation because any loan forgivable under the first interpretation will also be forgivable under the second, but not vice-versa.

7 The amount forgiven will be reduced proportionally by any reduction in the number of employees retained during the 8-week period after receipt of the loan compared to one of two prior pay period time periods determined by the borrower and reduced by the reduction in pay of any employee beyond 25% of their prior year compensation. Certain exceptions to this rule apply for businesses that re-hire laid off workers or raise wages to make up for salary reductions.

3. How can I apply?

You can apply for a PPP loan through any third-party lender or any federally insured depository institution, federally insured credit union, and Farm Credit System institution that has executed a participation agreement with the SBA under its 7(a) loan program.  Other regulated lenders will be available to make these loans once they are approved and enrolled in the program.  You should consult with your local lender as to whether it is participating in the SBA’s 7(a) loan program.

Many national and regional banks have opened online portals enabling applicants to submit their applications online.  However, many are only accepting applications from customers with pre-existing business lending and deposit relationships.  It will likely be easiest to apply for a PPP loan through the bank that you already use for your business’ banking needs.

When completing your application, you will be asked to submit documentation substantiating your eligibility for a PPP loan, including all relevant payroll records.  Gathering these documents may take some time.  Some lenders may require additional documentation if you are a new customer.  In order to ensure that you have gathered all necessary information, you should consult with your lender to ask what documentation you must provide when you apply for a PPP loan.

4. Where can I find more information about the program?

Visit the U.S. Department of Treasury’s Small Business Assistance page, available at https://home.treasury.gov/policy-issues/cares/assistance-for-small-businesses.  For an in-depth guide to PPP loans, along with tips for filling out the Borrower Application Form, see Paul Hastings’s publication on the Program, available at https://www.paulhastings.com/publications-items/details/?id=7b8f1b6f-2334-6428-811c-ff00004cbded#_edn3. Additionally, you can find eligible lenders in your area by visiting https://www.sba.gov/paycheckprotection/find.

B. Economic Injury Disaster Loans and Emergency Advances from the Small Business Administration

The CARES Act and the Coronavirus Preparedness and Response Supplemental Appropriations Act expanded the U.S. Small Business Administration’s (SBA) Economic Injury Disaster Loan (EIDL) program to small business owners in the United States and territories to help overcome a temporary loss of revenue during the COVID-19 pandemic.  Under the program, small businesses are eligible for an emergency advance of up to $1,000 per employee (to a maximum of $10,000) that need not be repaid, and can borrow up to $2,000,000 at a 3.75% APR (2.75% for non-profits).  Loans may be used for lost income as well as for operating costs such as payroll, sick leave, rent/mortgage payments, material costs, and/or pre-existing debt payments.

Separately, the SBA provides Express Disaster Bridge Loans for up to $25,000 that businesses and non-profit organizations can use for urgent cash needs while waiting for decision and disbursement on an Economic Injury Disaster Loan—which may take 30 days or more—although the SBA says the emergency advance should be distributed within a few days.  More information on Bridge Loans is available at https://www.sba.gov/funding-programs/loans/coronavirus-relief-options/sba-express-bridge-loans

1. Am I eligible?

To be eligible for an EIDL, an applicant small business must experience a loss of revenue resulting from the COVID-19 pandemic.  In order to determine whether your annual revenue has decreased, the SBA will compare your revenue starting on January 31, 2020, to your revenue from the prior year.  You only need to show a loss; there is no threshold amount or percentage.  However, to be eligible for an EDIL, you must have received revenue before January 31, 2020.

In general, the program is limited to businesses with fewer than 500 employees (including sole proprietorships and independent contractors), although there are exceptions for some industries.  If your business has more than 500 employees, the SBA has resources available to help you determine whether you are still eligible for an EIDL at: https://www.sba.gov/document/support--table-size-standards.  The SBA will also consider factors such as your credit score, gross revenue, and cost of goods sold in order to select applicants more likely to repay the loan.  However, you do not need to provide any collateral other than providing the SBA a personal guarantee for loans above $25,000.

2. How can I apply?

You can apply for an EIDL online through the SBA at https://www.sba.gov/funding-programs/loans/coronavirus-relief-options/economic-injury-disaster-loan-emergency-advance.  If you need assistance with your application, contact your local SBA District Office or one of the SBA’s resource partners, including the Small Business Development Center, Women’s Business Center, or SCORE mentorship chapter.  Use the SBA’s assistance locator at https://www.sba.gov/local-assistance/find/ to find an SBA Office or resource partner in your area.

3. Where can I find more information about the program?

Visit the Small Business Administration’s EIDL page, available at https://www.sba.gov/funding-programs/loans/coronavirus-relief-options/economic-injury-disaster-loan-emergency-advance.  Additionally, Rhode Island Commerce has a comprehensive comparison between the PPP and EIDL programs available at https://commerceri.com/covid-19-sba-loan-faq/.

Other Resource Links:

NVLSP Fact Sheet on CARES Act Stimulus

VA Public Health

VA Coronavirus FAQs

VA Benefits and Resources Guide

Centers for Disease Control and Prevention

Veterans Education Success Coronavirus-Related Legislation and Its Relevance to GI Bill and Other VA-Supported Students

If you have questions regarding your COVID-19 government benefits, please contact us at info@nvlsp.org.

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