Sponsors (2)
Official title: Require the Administrator of the Small Business Administration to establish a program to allow small business concerns to purchase certain commodities futures, and for other purposes.
Introduced January 23, 2025 by Jeanne Shaheen · Last progress January 23, 2025
The bill gives small businesses new, government-supported hedging tools, guidance, and a multi-year pilot to manage volatile fuel and commodity costs, but it shifts financial risk to participants and taxpayers, excludes some firms (including very new startups), and adds administrative and reporting burdens that could limit participation and create unpredictability.
Small businesses can reduce their exposure to volatile fuel and other commodity input costs by using Program hedging tools (including call options) and locking in prices.
Small businesses gain access to a government-backed commodity-pooling option that can lower transaction costs and expand practical access to hedging for firms that otherwise lack scale.
Small businesses receive targeted guidance, outreach, webinars, a help line, and clarified delivery channels through included resource partners (SBDC, WBCs, SCORE, Veteran Business Outreach Centers), making it easier to understand and use risk-management tools.
Taxpayers could face open-ended funding exposure because the pilot is funded with 'such sums as may be necessary' for up to five years, creating potential fiscal cost uncertainty.
Small businesses that participate may suffer losses from complex commodity derivatives or find hedging unsuitable for their revenue model or expense share, imposing financial risk on participants.
The Small Business Administration and program administrators face financial and operational risk (including pressures to close positions, limits on physical delivery in some cases) and could need to divert resources to manage the Program.
Based on analysis of 5 sections of legislative text.
Creates an SBA pilot that helps eligible small businesses hedge commodity input costs via at-cost futures/derivative agreements, with gasoline and diesel included.
Creates a pilot SBA program to help eligible small businesses hedge against rising and volatile commodity input costs by entering at-cost agreements for futures, options, or related derivatives. The SBA must set up the Helping Small Businesses Thrive Program within one year, consult regulators, run outreach, select covered commodities (must include gasoline and diesel), offer limited-duration agreements (60 days–3 years), and report annually to small-business committees.