I feel it is fitting to discuss several financial programs for veterans in business or who are contemplating business today. There are several little known financing programs and government contracting opportunities available to vets, many of which vets aren’t aware of.
The SBA serves small businesses in several ways. Most people know of the guaranteed loan programs like the 7a program or the 504 real estate loan program. However, very few people know there is a special lending program specifically for vets. It is called the Patriot Express Loan Program, and is only available to vets and spouses of active duty military personnel.
People eligible to participate include:
- Service-disabled veterans
- Active-duty service members eligible for the military’s Transition Assistance Program
- Reservists and National Guard members
- Current spouses of any of the above
- The veteran applying for the Patriot Express loan must own 51 percent of the enterprise to qualify
- The widowed spouse of a service member or veteran who died during service or of a service-connected disability
- The SBA and its resource partners are focusing additional efforts on counseling and training to augment this loan initiative
This SBA program is in its pilot phase and about 875 lenders are participating. Interestingly, several credit unions that serve existing military members or vets are making the majority of Patriot Express loans. For example, Randolph Brooks Federal Credit Union that serves a large military and veteran population in Central and South Texas. For the San Antonio SBA district, Randolph Brooks has made the most Patriot Express loans in the district to date.
Another financial opportunity for service-disabled veterans [PDF] is the SBA 8(a) program which is designed to assist 8(a) certified companies to win federal government contracts. Service-disabled veteran owned companies represent a group that are entitled to be awarded set-aside contracts. According to the Government Services Administration, its spending goal for total contracts awarded to service-disabled veterans for the current fiscal year is 3.2 percent of all procurement dollars. In some cases, service-disabled-veteran-owned companies will not have to compete for the contracts. These contracts are called sole source contracts and can be as large as $5.5 million, depending on the type of company.
Veterans and service-disabled vets that are in business or considering starting a business should learn all they can about these federal government programs. I currently work with three companies that are owned by service-disabled veterans. One is an electrical contractor that has been awarded subcontracts on federal projects, another is in the medical staffing arena for Department of Defense hospital clinics, and the last provides vehicle support for the U.S. Border Patrol working along the Texas-Mexico border. All three have had many of the same kind of struggles common for other small businesses, but the good news is because of their the contracting program available to service-disabled veterans, they have a significant shot at building solid businesses over time that will help sustain them for the rest of their lives.