S.202 - Helping Small Businesses To Hedge Risk and Insure against Volatile Expenses Act; Helping Small Businesses THRIVE Act (119th Congress)
Summary
S.202, the "Helping Small Businesses THRIVE Act," aims to establish a program within the Small Business Administration (SBA) to assist eligible small businesses in hedging against volatile commodity expenses. The program would allow these businesses to purchase certain commodities futures to mitigate risks associated with rising input costs. The bill outlines eligibility criteria, application processes, and the types of agreements the SBA can enter into with small businesses.
Expected Effects
The bill's enactment would lead to the creation of a new SBA program focused on commodity hedging for small businesses. This could stabilize operating costs for participating businesses, particularly those heavily reliant on specific commodities like gasoline and diesel. The program's success hinges on effective administration, accurate commodity selection, and sufficient funding.
Potential Benefits
- Reduced Risk: Helps small businesses manage the risk of rising commodity prices.
- Cost Stability: Stabilizes operating costs, making financial planning easier.
- Economic Growth: Supports small business growth and expansion by reducing financial uncertainty.
- Program Guidance: Provides guidance and resources to help small businesses understand and utilize commodity futures markets.
- Targeted Assistance: Focuses on small businesses that are not financial institutions or heavily regulated by the Commodity Exchange Act.
Most Benefited Areas:
Potential Disadvantages
- Administrative Complexity: Establishing and managing the program could be complex and costly.
- Market Risk: The SBA's involvement in commodity futures markets could expose it to financial risks.
- Eligibility Restrictions: Some small businesses may be excluded due to eligibility criteria.
- Limited Scope: The program initially focuses on a limited number of commodities, potentially excluding businesses reliant on others.
- Potential for Mismanagement: Ineffective administration could lead to losses or unfair distribution of benefits.
Constitutional Alignment
The bill appears to align with the Commerce Clause (Article I, Section 8), which grants Congress the power to regulate commerce among the states. By supporting small businesses and stabilizing their operating costs, the bill could indirectly promote interstate commerce. The bill does not appear to infringe upon any specific constitutional rights or limitations.
Impact Assessment: Things You Care About ⓘ
This action has been evaluated across 19 key areas that matter to you. Scores range from 1 (highly disadvantageous) to 5 (highly beneficial).