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Federal Worker Emergency Loan Program Guidelines

General Information

Authorized under the Maryland Protect Our Federal Workers Act of 2025, the Federal Worker Emergency Loan Program (the “Program”) provides financial support to federal workers terminated due to mass layoffs, relocations, closures, and similar actions enacted by the Trump Administration. Administered by the Maryland Department of Labor, the Program offers a zero-interest loan of $700 from the State of Maryland, which is due 180 calendar days after the date the loan agreement is signed. If loan recipients continue to experience financial hardship and are not able to repay the loan on time, they may apply for a 90-day repayment extension. 

The loan is available to Maryland residents who were terminated from federal employment after January 1, 2025, and in the immediately preceding six months due to closure, relocation, or mass layoff of a unit of the federal government, or other similar circumstances beyond their control, and who are experiencing financial hardship.

Program Guidelines

Definitions

  1. “Adverse determination” means a denial or cancellation of a Federal Worker Emergency Loan Program loan payment Application or a charge for an overpayment.

  2. “Applicant” means any individual who applies for a loan from the Federal Worker Emergency Loan Program.

  3. “Borrower” means an Applicant whose Application for the Federal Worker Emergency Loan Program has been approved and has received a loan payment.

  4. “Canceled loan payment” means the discontinuation of loan payments at the initiation of the Department.

  5. “Application” means an Applicant’s submission to the Federal Worker Emergency Loan Program. 

  6. “Complete Application” means an Application submitted by an Applicant to the Federal Government Emergency Loan Program with all required supporting documentation, including signed loan agreement. 

  7. “The Department” means the Maryland Department of Labor.

  8. “The Federal Worker Emergency Loan Program” refers to the loan program that offers a zero-interest loan of $700 to Maryland residents who were terminated from federal employment on or after January 1, 2025.

  9. “Fraud” means a misrepresentation or concealment of a material fact made by an applicant which induces the State to provide a Federal Worker Emergency Loan Program loan payment when the applicant would have otherwise not qualified.

  10. “Good cause” means a demonstration by an Applicant that a failure to file a complete Application was due to a serious health condition that resulted in an unanticipated and prolonged period of incapacity and that prevented an individual from filing an Application in a timely manner.

  11. “Federal employee” means a person who previously worked directly for a unit of the United States government. This could include units of the executive, legislative, or judicial branches of the federal government. This does not include individuals who contract with the federal government or work for a business that contracts with the federal government.

  12. “Financial hardship” refers to any situation in which an Applicant:

    1. Lacks sufficient income to pay for basic expenses, such as housing, childcare, utilities, healthcare, or transportation; and

    2. Lacks other means to pay for basic expenses. 

Having resources such as savings accounts or retirement funds, or owning a home or other asset with equity, does not preclude an Applicant from claiming financial hardship if accessing that equity would require the applicant to incur penalties or other costs they believe they cannot pay. The Applicant may consider expenses they pay on behalf of a spouse, domestic partner, child, parent, or other family member. To demonstrate their financial hardship, applicants must attest that their current pay has been reduced by at least 25 percent compared to the period before they were terminated from federal employment; attest that they are at risk of missing a payment or payments totaling at least $700 for household expenses, due to this reduction in pay; and

provide documentation, upon request, of household expenses that they may be unable to pay due to that reduction in income. This documentation must be dated within the 30 calendar days preceding the loan application and may include the following: mortgage statement; lease; utility bill; vision, dental, or other healthcare service statement; childcare contract or bill; car loan statement; car insurance statement; medical insurance reconciliation notice; or credit card or other loan statement.

  1. “Loan” refers to the $700 loan advanced to a borrower through the Federal Worker Emergency Loan Program.

  2. “Loan Agreement” means the document that sets forth the terms and conditions of a $700 Loan advanced through the Federal Worker Emergency Loan Program.

  3. “Maryland resident” means a person who is living in the State of Maryland and not for a temporary purpose and has no immediate intention of moving from the State. A resident may live outside the State if the absence does not exceed 90 calendar days and their Maryland residence has not been abandoned.

  4. “Overpayment” means an individual receives a Federal Worker Emergency Loan Program loan payment to which they are not eligible due to a fraudulent Application or through no fault of their own.

  5. “Termination of federal employment” refers to termination due to mass layoffs (including Reductions in Force), relocations, closures, or similar actions from a unit of federal government that led to involuntary separation. Individuals who accepted voluntary resignation agreements or early resignation offers are not eligible for this program.

Eligibility 

Any individual is eligible to receive a Federal Worker Emergency Loan Program payment if they: 

  1. Were terminated from federal employment after January 1, 2025, and in the immediately preceding six months due to closure, relocation, or mass layoff of a unit of the federal government, or other similar circumstances beyond the employees’ control. 

  2. Are a resident of Maryland; and

  3. Attest to experiencing financial hardship as defined above. The Department may at any time request copies of documentation supporting an applicant’s claim of financial hardship. This documentation must be dated within 30 calendar days preceding the Loan Application and it should demonstrate difficulty paying for essential needs, such as housing, transportation, utilities, or healthcare.

Application Process

  1. Required Documentation. An Applicant shall provide all information and documentation as required by the Application including:

      1. Proof of identity:
        1. U.S. or state government issued photo identification;
        2. Social Security Number (SSN) or Individual Tax Identification Number (ITIN); and
        3. A real-time photograph taken by smart phone or webcam during the application process.
      1. Proof of Maryland residency:
        1. At least two different documents with the applicant’s full name and current Maryland residential address dated within 6 months of the Application submission. These two documents should not be from the same company or agency and may include the following:
          1. Utility, telephone, cable or satellite TV bill;
          2. Checking, savings or financial account statement;
          3. Property tax bill or receipt;
          4. Mortgage account statement, deed, or other proof of homeownership;
          5. Residential rental contract (current apartment lease or other current rental or real property with signatures);
          6. Mail from a federal, state or local government agency; or
          7. Installment (loan) documents from a bank or other financial institution.
      1. Proof of federal employment:
        1. At least two different documents that provide proof of former federal employment. These should have the applicant’s name full name on them and could include:
          1. Recent SF-50 (Standard Form 50 - Notification of Personnel Action);
          2. Most recent two federal pay stubs; or
          3. 2024 W-2 from the federal government.

        Note: The Department may also seek verification of federal employment from Equifax, the Comptroller of Maryland, or through other means. If federal employment is verified through these other sources, that may supersede any documentation provided.

      2. Proof of termination of employment:
        1. At least one document that demonstrates termination due to mass layoff, closure, relocation, or similar circumstances. This should have the applicant’s name full name on it and could include:
          1. Recent SF-50 (Standard Form 50 - Notification of Personnel Action);
          2. Reduction in Force (RIF) notice from the federal government; or
          3. Email or other official notification of termination from the federal government.
      3. Self attestation to and proof of financial hardship:
        1. Applicants must demonstrate their financial hardship by:
          1. Attesting that their current pay has been reduced by at least 25 percent compared to the period before they were terminated from federal employment;
          2. Attesting that they are at risk of missing a payment or payments totalling at least $700 for household expenses, due to this reduction in pay; and
          3. Providing documentation, upon request, of household expenses that they may be unable to pay due to that reduction in income. This documentation must be dated within the 30 calendar days preceding the loan application and may include the following:
            1. Mortgage statement;
            2. Lease;
            3. Utility bill,
            4. Vision, dental, or other healthcare service statement;
            5. Childcare contract or bill;
            6. Car loan statement;
            7. Car insurance statement;
            8. Medical insurance reconciliation notice; or
            9. Credit card or other loan statement.
        2. Monitoring and Audits. The Department may conduct random audits and monitoring of borrower’s eligibility at any time. In addition, the Department will request financial hardship documentation from a random sampling of Borrowers. If Borrowers are unable to provide documentation that meets the eligibility criteria outlined above or other discrepancies are found by the Department, the application may be considered fraudulent and subject to the overpayment process.

  2. Fraud. If Program payments have been approved and additional information proving fraud in the Application or related supplemental submissions is provided to the Department, then any loan payments issued shall be repaid in accordance with the overpayment process outlined in this document.

  3. Updating an Application.

    1. Personal information such as an applicant’s Social Security Number or address in an Application may be updated after it is submitted in a controlled manner supervised by the Department.
    2. Supporting documentation in an Application shall be updated within 10 business days, or as soon as practicable with good cause shown, of any changes to the information provided on an Application.
    3. If the Department requests additional information from the applicant, the applicant will have 10 business days to submit the information, or as soon as practicable with good cause shown, or the Application will be denied.

  4. Cancellation of an Application. In the event an applicant no longer requires the Loan payment, their Application may be withdrawn.

  5. Notice1. Applicants shall be provided notice in the following circumstances:

      1. When their Application is submitted.
      2. If an Application is deemed incomplete by the Department.
      3. If their Application is approved, including the loan amount.
      4. If the Loan Agreement is deemed incomplete by the Department.
      5. When their signed loan agreement has been received by the Department.
      6. If their Application is denied, and the notice shall include:
        1. State concisely and simply:
          1. The reasons for denial;
          2. The Applicant’s appeal rights;
        2. State that the Applicant has the opportunity to request an appeal, including:
          1. What, if anything, a person must do to appeal; and
          2. All relevant time requirements; and
        3. State the consequences of failing to apply in a timely manner without good cause.

    1 All application and notice materials will be available in English and Spanish.

Loan Agreement and Payment Process

  1. Loan Agreement. The Loan Agreement will be sent to an applicant once their Application has been approved. It sets forth the terms and conditions of the $700 loan. 

    1. The Applicant has 15 business days to sign and submit the Loan Agreement or their Application will be denied, unless good cause for the delay can be shown.

    2. By submitting an Application, signing the Loan Agreement, and receiving the proceeds of the Loan, the Borrower promises to pay to the State of Maryland the sum of $700 and agrees to be bound by the terms set forth in the Loan Agreement. 

  2. Loan Schedule. The Loan will be made as soon administratively feasible, generally within 15 business days of a submission of a complete Loan Agreement.

Repayment 

  1. Repayment deadline. The Loan will be due 180 calendar days after the date the Loan Agreement is deemed dated.

  2. Repayment Extension. If a Borrower continues to experience financial hardship, they may request a 90-day repayment extension. 

    1. In the month before the 180-day due date, the Borrower will receive an email prompting them to repay the Loan in full. The email will contain an option to request a 90-day extension if the Borrower is continuing to experience financial hardship. 

    2. The Applicant will be required to attest that they are experiencing financial hardship as defined above. 

    3. No additional documentation will be required; however the Department reserves the right to request documentation supporting the Borrower’s original claim of financial hardship at any time.

  3. Repayment. The State of Maryland will provide a means to repay the Loan electronically. If the Borrower is not repaying the Loan electronically, the Borrower will need to make all Loan payments at the address included in the Loan Agreement. 

  4. Interest. No interest shall be charged or due. 

  5. Partial repayment. Borrowers may prepay the Loan in whole or in part without premium or penalty.

Overpayment

  1. Notice. On learning of overpayment of loan funds, the Department will send written notice of the overpayment to the Borrower.

  1. Repayment. Repayment of loan funds will be sought if the Loan was made erroneously or as a result of willful misrepresentation by the Borrower.

    1. In cases of seeking repayment, the Borrower shall have 30 calendar days to reply to the notice indicating the Borrower agrees to repay or that the Borrower requests a waiver.

  2.  Waiver. Repayment of an erroneous Loan payment may be waived if: 

    1. The error in payment was not due to any knowingly false statement, nondisclosure of material fact, or misrepresentation by a covered individual; or

    2. The repayment would be against equity and good conscience or administrative efficiency.

Collections Process

  1. If a Borrower fails to pay the Loan when due, the State of Maryland may, without notice, refer this matter to the State’s Central Collections Unit for collection. Upon such referral, the Borrower shall be obligated to pay the State of Maryland’s Central Collection Unit’s standard collection fee, which equals 17% of the amount owed under the Loan Agreement, and all other reasonable expenses incurred by the State in exercising any of its rights and remedies upon default.

Appeals 2

  1. Entitlement.

    1. Any Applicant whose Application has been denied, a Borrower who receives notice of a canceled loan payment, or a Borrower who is notified that an overpayment has been determined is entitled to file an appeal of the adverse determination.

    2. As part of the appeals process, the Applicant has the opportunity to submit new information for review that could reverse the adverse determination. 

    2 The appeal shall be filed within 15 business days of the adverse determination, or 15 business days after the Appeals process is available, whichever is later, unless the Applicant or Borrower can show good cause.

  2. Hearing Notice.

    1. Parties to appeals shall be provided with reasonable written notice of a hearing.

    2. The hearing notice shall contain:

      1. The date, time, place, and nature of the hearing;

      2. A statement of the right to present witnesses, documents, and other forms.

      3. A statement of the right to request subpoenas for witnesses and of evidence, and the right to cross-examine witnesses of another party;

      4. A copy of the hearing procedure;

      5. A statement of the right or restrictions pertaining to representation;

      6. A statement that failure to appear for the scheduled hearing may result in an adverse action against that party; and

      7. A statement that the parties may agree to the evidence and waive their right to appear at the hearing.

    3. Absent unusual circumstances, a hearing shall be held on the appeal within 30 calendar days of filing of the appeal.

  3. Service of Notices, Orders, and Other Documents. 

    1. Except as provided by prior agreement of the parties, the Hearing Officer shall serve notices, orders, and other documents in one of the following ways:

      1. By personal delivery; or

      2. By mailing a copy of the document, first class, postage prepaid, to the person’s last known business or home address; and

      3. If the person is represented by counsel, also by delivering or mailing a copy of the document, first class, postage prepaid, to the person’s attorney.

    2. The Hearing Officer shall send the hearing notice to the parties to the appeal electronically and by mail to the person’s last known address:

      1. At least 10 business days before the hearing; or

      2. If the parties have agreed to a date for which 10 business days notice cannot be given, at the earliest time possible.

  4. Representation.

    1. A party to a proceeding may:

      1. Appear individually or, if appearance by a representative is permitted by law, through a representative; or

      2. Be represented by an attorney authorized to practice in Maryland.

    2. Any notice, decision, or other matter required to be sent to a party may also be sent to the party’s attorney of record at the attorney’s address.

    3. If a party is represented by an attorney or appears through an authorized representative, then examination and cross-examination of witnesses, and objections and motions on the party’s behalf shall be made solely by the attorney or the authorized representative.

  5. Failure to Appear. 

    1. A hearing may proceed as scheduled in the absence of a party if the party has:

      1. Been properly served; and

      2. Failed to obtain a postponement of the hearing from the hearing officer under these requirements.

    2. In the event a party fails to appear the matter may be reopened. The Department shall follow the reopening procedures outlined in COMAR 09.32.11.02 O and P.

  6. Postponement.

    1. The Hearing Officer may postpone a hearing only if a written request for postponement is filed with the hearing officer not later than 10 business days before the date of the hearing.

    2. If a request for postponement is received later than 10 business days before the date of the hearing, the hearing officer shall deny the request unless they determine that there was good cause which justified the delay.

    3. Failure to retain counsel or to timely request a subpoena may not be considered good cause.

  7. Discovery. There is no pre-hearing discovery.

  8. Conduct of the Proceedings.

    1. The Hearing Officer may impose reasonable time limitations.

    2. The Maryland Rules of Civil Procedure may be used as a guide in resolving procedural issues governing the conduct of the hearing.

    3. The hearing officer may conduct all or any part of the hearing by telephone, video conference, or other electronic means.

  9. Order of Proceedings. Absent unusual circumstances, the order of proceedings shall be as follows:

    1. Opening statements and preliminary matters may be heard.

    2. All individuals planning to testify shall be sworn before testifying.

    3. The Applicant or Borrower or their attorney or authorized representative may present the Applicant/Borrower’s case.

    4. The Department may present the Department’s case.

    5. The Applicant/Borrower shall be entitled to a brief rebuttal after the conclusion of the Department’s case.

    6. The Hearing Officer may hear closing arguments in the same order as the presentation of evidence.

    7. Dispositive motions are prohibited.

  10. Evidence. The rules of evidence for appeals under the Federal Government Employee Assistance Loan Fund shall be as follows:

    1. Admissibility of Evidence: All relevant evidence is admissible, unless it is deemed unreliable or prejudicial. Irrelevant, immaterial, or unduly repetitious evidence should be excluded.

    2. Hearsay Evidence: Hearsay evidence may not be excluded solely on the basis that it is hearsay.

    3. Documentary Evidence: Documentary evidence may be received in the form of copies or excerpts or by incorporation by reference. 

    4. Official Notice: The Department may take notice of judicially cognizable facts and in addition may take notice of general, technical or scientific facts within the Department’s specialized knowledge.

    5. Cross-Examination: A party has the right to conduct cross-examination of witnesses as required for a full and true disclosure of the facts.

    6. Burden of Proof: The proponent of an order has the burden of proof. The standard of proof generally required is a preponderance of the evidence.

    7. Expert Witnesses: Expert witnesses may be used to provide specialized factual information or opinions, but they must be properly qualified and their testimony must be relevant and reliable.

    8. Objections: The rules of privilege shall be effective to the extent that they are recognized in law. All other objections to evidentiary offers may be made and shall be noted in the record.

    9. Confidential Information: Any confidential information that is protected by law shall not be disclosed without proper authorization.

  11. The record shall include:

    1. All pleadings, motions, responses, correspondence, memoranda, including proposed findings of fact and conclusions of law, and requests filed by the parties;

    2. All hearing notices;

    3. All documentary and other tangible evidence received or considered;

    4. A statement of each fact officially noticed;

    5. All stipulations;

    6. All offers of proof and objections;

    7. All rulings, orders, and decisions, proposed or final;

    8. Matters placed on the record in connection with ex parte communication;

    9. The recording of the hearing, and any prehearing proceeding, and any transcript of the recording prepared by a court reporting service; and

    10. Any other item required by law.

  12. Interpreters. The Department’s established rules regarding interpreters apply.

  13. Burden of Proof. The Applicant/Borrower shall bear the burden of proving, by a preponderance of the evidence, that the applicant/borrower is entitled to Federal Worker Emergency Loan payments.

  14. Recording.

    1. The proceedings shall be recorded.

    2. The record need not be transcribed unless requested by a party.

    3. The cost of a typewritten transcript of any proceeding or part of a proceeding shall be paid by the party requesting the transcript.

    4. Except as provided above, cameras, tape recorders, and other electronic and photographic equipment of any type are not permitted at the hearing, unless the equipment is intended to be introduced into evidence or used to present evidence.

  15. Recusal. A Hearing Officer shall be recused from the review of an appeal and from participating in a hearing if the Hearing Officer:

    1. Has personal knowledge of the facts which gave rise to the appeal;

    2. Has a personal or business relationship with any of the parties or witnesses; or

    3. For any other reason may be unable to act impartially in the matter.

  16. Decisions. After consideration of the testimony and other evidence at the conclusion of the hearing, the Hearing Officer shall issue a final written order within 5 business days of the hearing, which shall include specific findings of fact on all relevant factual issues and conclusions of law, to the parties at the conclusion of the hearing. A Hearing Officer may grant good cause to reapply after the deadline if it is in the interests of fairness and equity.

  17. Judicial Review. A party aggrieved by the final order may seek a writ of administrative mandamus under Maryland Rule 7-401, et seq., asking a court to review the Department’s Decision, and shall be apprised of this right. A petition for a writ of administrative mandamus must be filed, except as otherwise provided by Maryland Rule 7-203 or by statute, within 30 calendar days after the latest of: (1) the date of the order or action of which review is sought; (2) the date the Department sent notice of the order or action to the petitioner, if notice was required by law to be sent to the petitioner; or (3) the date petitioner received notice of the agency’s order or action, if notice was required by law to be received by the petitioner.