Fund for Iowa veterans would be tightened to avoid future depletion

DES MOINES — Eligibility and payouts from a state fund to cover emergency expenses for Iowa veterans would be tightened under a proposal from the head of the state department on veterans’ affairs.

The proposal was designed in response to last year’s depletion of the state fund, which left thousands of dollars’ worth of veterans’ claims unpaid.

Income eligibility would be lowered, returning the threshold to a previous standard, and payouts would be capped both annually and lifetime under the proposal from Iowa Veterans Affairs Director Todd Jacobus.

“What we need to do is we need to manage the system differently than what we’ve managed it up to this point. And I think that’s very possible,” Jacobus told The Gazette last month. “It all has to do with management of the resources that we’re given by the state Legislature through the trust fund. And we can do that.”

The Iowa Veterans Trust Fund is available to low-income Iowa veterans who need assistance making emergency payments for things like medical equipment, emergency room care, dental and hearing care, emergency housing and vehicle repairs, counseling, unemployment assistance and job training.

Last October, for the first time in a decade, the allowable spending from the trust fund was depleted. State officials cited a recent expansion of eligibility in the program, increased claims from 2020 due to the COVID-19 pandemic and derecho, and increased costs for claims due to inflation.

The commission awarded $632,000 in claims in 2019 and $573,000 in 2020. During 2021, the commission awarded nearly $1.3 million in claims, according to the trust fund’s annual report.

Late last month, Gov. Kim Reynolds approved more than $440,000 in federal pandemic relief funding to address the trust fund’s claims backlog.

Under Jacobus’ proposal, eligibility for the trust fund would be reduced to Iowa veterans below 200 percent of federal poverty level, which equates to annual income of $29,160 for an individual or $60,000 for a family of four. That would return the program to its previous level; recently, it had been increased to 300 percent of federal poverty level.

Also under Jacobus’ proposal, payouts would be capped at $5,000 annually and $10,000 for life.

And, under the proposal, all payouts would be subject to final approval by the veterans affairs director. Currently, applications are considered and approved by the Iowa Commission of Veterans Affairs within the state VA department.

“We want to make sure that fund is there and used for that intent,” said Sen. Jeff Reichman, a Republican from Montrose who chairs the Senate’s committee on veterans affairs. “And (to) spread it out and not see that somebody is getting so much at any given time.”

Jacobus’ proposal, Senate Study Bill 1152, received its first legislative approval Tuesday from a three-member Senate subcommittee, which included Reichman. It is now eligible for consideration by the full Senate veterans affairs committee.

Sen. Janice Weiner, a Democrat from Iowa City who also sat on the subcommittee, said she would like to support the proposal but expressed concern that the new limits may be too restrictive. She proposed giving the state VA department director some leeway to approve an expenditure outside the proposed guidelines for extreme cases.

A separate proposal moving in the Iowa House, House Study Bill 21, would increase the state’s annual allocation to the Veterans Trust Fund from $500,000 to $800,000. That bill has passed the House’s veterans affairs committee and is eligible for consideration by the full House.

Comments: (515) 355-1300, erin.murphy@thegazette.com