Helping Small Businesses THRIVE Act

Summary

Creates a time-limited pilot program inside the Small Business Administration to help qualifying small businesses limit the risk of rising commodity input costs. The SBA will enter into administrator-run agreements that let eligible small businesses use commodity derivatives or options (including gasoline and diesel) to hedge price spikes, provide outreach and technical support, and report annually on program use and effects.

• Creates an SBA pilot program to help eligible small businesses hedge commodity input cost risk using derivatives and option agreements.
• Gasoline and diesel gasoline must be covered commodities; Administrator may add up to three more commodities in year one (one may be industry-specific).
• Agreements can sell derivatives at cost, include call-option protections for >5% price increases, and last 60 days to 3 years (typically ≥120 days).
• Program operations must favor CFTC-regulated contracts and may use registered commodity pool operators, trading advisors, or futures commission merchants.
• Participants must pay all costs and any initial fees; Program proceeds first cover operating costs and any excess returns to the Treasury general fund.
• Physical delivery of commodities is generally prohibited except in extreme exigent circumstances; positions must be closed to avoid delivery.
• Administrator must publish guidance, run outreach through SBA resource partners, and produce an initial report within 120 days plus annual reports.
• Certain financial and market-regulated entities are excluded from eligibility to focus benefits on small businesses.
• Authorizes funding as needed, available for up to five years, but places reporting and oversight requirements on Program operations.